Int To Mktng Ch 2

Strategic Planning for Competitive Advantage

CHAPTER
2
Marketing 10
Lamb, Hair, McDaniel
Designed by
Prepared by
Eric Brengle
Amit Shah
B-books, Ltd.
Frostburg State University

Copyright ©2009 by Cengage Learning Inc. All rights reserved 1

Learning Outcomes

Understand the importance of strategic marketing
LOI and know a basic outline for a marketing plan

Develop an appropriate business
LO2 mission statement

Explain the components of a situation analysis
LO3


Learning Outcomes

LO4 Explain the criteria for stating good marketing
objectives
LO5
Identify sources of competitive advantage
LO6
Identify strategic alternatives
LO7
Discuss target market strategies


Learning Outcomes

LO8 Describe the elements of the marketing mix

Explain why implementation, evaluation, and
LO9 control of the marketing plan are necessary

Identify several techniques that help make
LOIO strategic planning effective


LOI The Nature of Strategic Planning

Understand the importance
of strategic marketing
and know a basic outline
for a marketing plan


LOI
Strategic Planning

Strategic
Strategic
Planning
Planning The managerial process of
creating and maintaining a fit
between the organization’s
objectives and resources and
evolving market opportunities.

The goal is long-term
profitability and growth.


Strategic Marketing Management
What is the organization’s main activity?

How will it reach its goals?

THE ANSWER IS A MARKETING PLAN.

LOI 7
Copyright ©2009 by Cengage Learning Inc. All rights reserved

LOI
Marketing Planning

Marketing Plan
Marketing Plan A written document that acts
as a guidebook of marketing
activities for the marketing
manager.


Why Write a Marketing Plan?
Provides a basis for comparison of actual
and expected performance

Provides clearly stated activities to work
toward common goals

Serves as a reference for the success of
future activities

Provides an examination of the
marketing environment

Allows entry into the marketplace with awareness

LOI Copyright ©2009 by Cengage Learning Inc. All rights reserved
9

Marketing Plan Elements
Business Mission
Statement

Objectives

Situation or SWOT
Analysis

Marketing Strategy
Target Market
Strategy

Marketing Mix
Product Distribution

Promotion Price

Implementation
Evaluation
Control
LOI Copyright ©2009 by Cengage Learning Inc. All rights reserved
10

LOI REVIEW LEARNING OUTCOME
The Importance of Strategic Marketing

What
What Strategic Planning
Strategic Planning

Long-term profitability
Long-term profitability
Why
Why and growth
and growth

How
How Write a marketing plan
Write a marketing plan


LO2 Defining the Business Mission

Develop an appropriate
business mission statement


LO2 Defining the Business Mission

• Answers the question,
“What business are we in?”

• Focuses on the market(s)
rather than the good or service

• Strategic Business Units (SBUs) may
also have a mission statement

13

Southwest Airlines Mission
Statement

SOURCE: http://www.southwestairlines.com/about_swa/mission

LO2 14

Strategic Business Units
LO2
(SBUs)

Characteristics:
[SBU HAS…]

• A distinct mission and specific target market
• Control over its resources
• Its own competitors
• Plans independent of other SBUs

15

LO2 REVIEW LEARNING OUTCOME
Business Mission Statement

Q: What business are we in?

A: Business mission statement

Too narrow marketing myopia
Too broad no direction
Just right focus on markets
served and benefits
customers seek


LO3 Conducting a Situation Analysis

Explain the components
of a situation analysis


LO3
Conducting a Situation Analysis

SWOT Analysis Identifying
SWOT Analysis
internal strengths (S)
and weaknesses (W)
and also examining
external opportunities (O)
and threats (T)


SWOT Analysis

S
Internal
Things the company does well.
Things the company does well.

W Things the company does not do well.
Things the company does not do well.

O
External
Conditions in the external environment that
favor strengths.
favor strengths.

T do not relate to existing strengths or favor
do not relate to existing strengths or favor
areas©South-Western College Publishing
areasof current weakness.
of current weakness.
LO3 Copyright ©2009 by Cengage Learning Inc. All rights reserved
19

LO3
Environmental Scanning

Environmental
Environmental The collection and interpretation
Scanning
Scanning of information about forces,
events, and relationships in the
external environment that may
affect the future of the
organization or the implementation
of the marketing plan.


LO3
REVIEW LEARNING OUTCOME
Components of a Situation Analysis

Strengths

ENVIRONMENT
production costs
INTERNAL

marketing skills
financial resources
image
technology

Weaknesses


Components of a Situation Analysis

Opportunities

social

ENVIRONMENT
EXTERNAL

demographic
economic
technological
political / legal
competitive

Threats


LO4 Setting Marketing Plan Objectives

Explain the criteria for stating
good marketing objectives


LO4
Marketing Objective

A statement of what is to be
Marketing accomplished through
Objective marketing activities.


LO4
Marketing Objectives

Realistic
“Our objective is to
Measurable increase sales of Purina
brand cat food by 15
Time specific percent over 2009 sales of
$300 million.”
Compared to a
benchmark

25

Criteria for Good Marketing Objectives
Realistic, measurable, and time-specific objectives
consistent with the firm’s objectives:

1. Communicate marketing management philosophy

2. Provide management direction

3. Motivate employees

4. Force executives to think clearly

5. Allow for better evaluation of results


LO5 Competitive Advantage

Identify sources of
competitive advantage


LO5
Competitive Advantage

Competitive
Competitive The set of unique features of a
Advantage
Advantage company and its products that
are perceived by the target
market as significant and
superior to the competition.


Cost
Cost

Types of
Types of Product/Service
Product/Service
Competitive
Competitive Differentiation
Differentiation
Advantage
Advantage

Niche Strategies
Niche Strategies

LO5 29

LO5
Cost Competitive Advantage

Cost
Cost
Competitive
Competitive Being the low-cost competitor
Advantage
Advantage in an industry while
maintaining satisfactory profit
margins.


LO5
Cost Competitive Advantage

Obtain inexpensive raw materials
Create efficient plant operations
Design products for ease of
manufacture
Control overhead costs
Avoid marginal customers

31

LO5
Sources of Cost Reduction

Experience Curves
Experience Curves Product Design
Product Design

Efficient Labor
Efficient Labor Reengineering
Reengineering

No-frills Goods and
No-frills Goods and Production Innovations
Production Innovations
Services
Services
New Service
New Service
Government Subsidies
Government Subsidies Delivery Methods
Delivery Methods

32

LO5
Product/Service Differentiation

Product //Service
Product Service The provision of something
Differentiation
Differentiation that is unique and valuable
Competitive
Competitive to buyers beyond simply
Advantage
Advantage
offering a lower price than
the competition’s.


LO5 Examples of
Product/Service Differentiation

Brand names
Strong dealer network
Product reliability
Image
Service

34

LO5
Niche Competitive Advantage

Niche
Niche The advantage achieved when
Competitive
Competitive a firm seeks to target and
Advantage
Advantage effectively serve a single
segment of the market.


LO5
Niche Competitive Advantage

• Used by small companies with
limited resources

• May be used in a limited geographic market

• Product line may be focused on a
specific product category

36

LO5 Sources of Sustainable
Patents
Patents
Copyrights
Copyrights
Locations
Locations
Equipment
Equipment
Technology
Technology
Skills and Assets
Skills and Assets
of an
of an Customer Service
Customer Service
Organization
Organization
Promotion
Promotion

37

Sources of Competitive Advantage

Sources of
Sources of

Product/Service
Product/Service
Cost
Cost Niche
Niche
Differentiation
Differentiation
$$ Strategies
Strategies
A vs. B vs. C
A vs. B vs. C


LO6 Strategic Directions



LO6
Strategic Alternatives

Market Increase market share among
Penetration existing customers

Market Attract new customers to
Development existing products

Create new products for
Product
Development present markets

Introduce new products
Diversification into new markets
40

Ansoff’s Strategic Opportunity Matrix

Present Product New Product

Present Market Product
Market Penetration Development

New Market Diversification
Market Development

LO6 Copyright ©2009 by Cengage Learning Inc. All rights reserved
41

Portfolio Matrix

Problem
Stars
Children

Cash Cows Dogs

LO6 42

Portfolio Matrix Strategies
Build

Hold

Harvest

Divest

LO6 43

Strategic Alternatives


Market development = customers

Market penetration = share

Product development = products
new products +
Diversification = new markets


LO7 Describing the Target Market

Discuss target
market strategies


LO7
Marketing Strategy

Marketing
Marketing The activities of selecting and
Strategy
Strategy describing one or more target
markets and developing and
maintaining a market mix that
will produce mutually
satisfying exchanges with
target markets.


LO7
Target Market Strategy

• Segment the market based on
groups with similar characteristics

• Analyze the market based on attractiveness
of market segments

• Select one or more target markets

47

LO7
Target Market Strategy

Appeal to the entire market
Appeal to the entire market
with one marketing mix
with one marketing mix

Concentrate on one
Concentrate on one
marketing segment
marketing segment

Appeal to multiple markets
Appeal to multiple markets
with multiple marketing mixes
with multiple marketing mixes

48

Target Market Strategies

Target Market Options

Entire Market Multiple Markets Single Market


LO8 The Marketing Mix

Describe the elements
of the marketing mix


LO8
The Marketing Mix

Marketing Mix
Marketing Mix A unique blend of product,
distribution, promotion, and
pricing strategies designed to
produce mutually satisfying
exchanges with a target market.


Marketing Mix: The “Four Ps”
Price

Promotion

Place

Product

LO8 52

The starting point of the
“4 Ps”
Product
Includes
Physical unit Products can be…
Package Tangible goods
Warranty Ideas
Service Services
Brand
Image
Value

LO8 53

Product availability where
and when customers want
them
Place

All activities from raw
materials to finished
products

Ensure products arrive in
usable condition at
designated places when
needed

LO8 54

Role is to bring about
exchanges with target Promotion
markets by:

Informing Includes integration of:
Educating
Personal selling
Persuading
Reminding Advertising
Sales promotion
Public relations

LO8 55

Price is what a buyer must
give up to obtain a product.
Price
The most flexible of the
“4 Ps”-- quickest to change

Competitive weapon

Price x Units Sold = Total Revenue

LO8 56

Elements of the Marketing Mix


LO9 Following Up on the Marketing Plan

Explain why implementation,
evaluation, and control
of the marketing plan
are necessary


LO9
Following Up the Marketing Plan
• Implementation

• Evaluation

• Control

• Marketing audit is…
• Comprehensive
• Systematic
• Independent
• Periodic
59

LO9
Implementation, Evaluation, and Control

Implementation Evaluation

Product
Product
Place
Place Met
Met
Promotion
Promotion objectives?
objectives?
Price
Price

Audits
Audits
•• comprehensive
comprehensive
•• systematic
systematic
•• independent
independent
•• periodic
periodic

LOIO Effective Strategic Planning

Identify several techniques
that help make strategic
planning effective


LOIO
Techniques for Effective Strategic Planning

Continual
Continual Management
Management
Creativity
Creativity
attention
attention commitment
commitment

Effective
Effective
Strategic
Strategic
Planning
Planning


Int To Mktng Ch 2

More Related Content

What's hot

Viewers also liked

Similar to Int To Mktng Ch 2

More from Universidad de Monterrey

Recently uploaded

Int To Mktng Ch 2