m

1. 2
Developing Marketing
Strategies and Plans

2. Chapter Questions
 How does marketing affect customer value?
 How is strategic planning carried out at
different levels of the organization?
 What does a marketing plan include?
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3. Phases of Value Creation and Delivery
Choosing the value
Designing the value
Delivering the value
Assessing the opportunities
Communicating the value

4. What is the Value Chain?
The value chain is a tool for identifying ways
to create more customer value because
every firm is a synthesis of primary and
support activities performed to design,
produce, market, deliver, and support its
product.

5.  The firm’s success depends not only on how
well each department performs its work,but
also how well company coordinates
departmental activities to conduct core
business process.
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6. Core Business Processes
 Market-sensing process
 New-offering realization process
 Customer acquisition process
 Customer relationship management process
 Fulfillment management process
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7. •The market-sensing process which refers to all the activities in
gathering and acting upon information about the market.
• The new-offering realization process which is all the activities in
researching, developing, and launching new high-quality offerings
quickly and within budget.
• The customer acquisition process which entails all the activities
in defining target markets and prospecting for new customers.
• The customer relationship management process which entails all
the activities in building deeper understanding, relationships, and
offerings to individual customers.
• The fulfillment management process which includes all the
activities in receiving and approving orders, shipping the goods on
time, and collecting payment

8. Characteristics of
Core Competencies
 A source of competitive advantage
 Applications in a wide variety of markets
 Difficult to imitate

9. Maximizing Core Competencies
 (Re)define the business concept
 (Re)shaping the business scope
 (Re)positioning the company’s brand identity

10. 2-10
What is Holistic Marketing?
Holistic marketing sees itself as integrating
the value exploration, value creation, and
value delivery activities with the purpose of
building long-term, mutually satisfying
relationships and co-prosperity among key
stakeholders.

11. Questions to Address in
Holistic Marketing
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What value opportunities are available?
How can we create new value offerings
efficiently?
How can we delivery the new offerings
efficiently?

12. Figure 2.1 The Strategic Planning,
Implementation, and
Control Processes
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13. 2-13
What is a Marketing Plan?
A marketing plan is the
central instrument for
directing and coordinating
the marketing effort.
It operates at a strategic and tactical level.

14. 2-14
Levels of a Marketing Plan
 Strategic
 Target marketing
decisions
 Value proposition
 Analysis of
marketing
opportunities
 Tactical
 Product features
 Promotion
 Merchandising
 Pricing
 Sales channels
 Service

15. Corporate Headquarters’
Planning Activities
 Define the corporate mission
 Establish strategic business units (SBUs)
 Assign resources to each SBU
 Assess growth opportunities
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16. Define the Corporate Mission
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17. Good Mission Statements
 Focus on a limited number of goals
 Stress major policies and values
 Less than 250 words
 Take a long-term view
 Short, memorable, meaningful
 Inspiring
 Identify the utility of firm’s products
 Reveal that firm is socially responsible and
environmental friendly.
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18. Cont…
Components of a good mission statement
 Customers
 Products and Services
 Markets
 Technology
 Concern for survival growth and profitability
 Self concept
 Concern for public image
 Philosophy
 Concern for employees
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19. Cont…
 What are the firm’s customers?
 What are the firm’s products and services?
 Geographically where does it compete?
 Is the firm technologically advance?
 Is the firm committed to growth and financial stability?
 What is the competitive advantage of the firm?
 Is firm responsive to public and environmental issues?
 What are the basic beliefs values and aspirations of
the firm?
 Are the employees valuable assets of the
firm?
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20. Establish Strategic Business Units (SBUs)
2-20

21. Characteristics of SBUs
 It is a single business or collection of related
businesses
 It has its own set of competitors
 It has a leader responsible for strategic
planning and profitability
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22. 2-22

23. Assign resources to each SBU
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24.  Once the company has defined SBUs,
management must decide how to allocate
resources to each SBU.
 BCG growth matrix use relative market share
and annual rate of market growth as a criteria
for investment decisions, classifying SBUs
such as dogs, cash cows, question marks and
stars.
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25. 2-25

26. 2-26

27. Cont..
2-27

28. Assess growth opportunities
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29. Cont…
 Assessing growth opportunities includes
planning new businesses, downsizing and
terminating older businesses.
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30. Growth Opportunities
1. Intensive Growth Opportunities: To identify
opportunities within current businesses.
2. Integrative Growth Opportunities: to build or
acquire business related to current
businesses.
3. Diversification: To identify opportunities to add
attractive unrelated businesses.
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31. Intensive Growth Opportunities
2-31

32. Integrative Growth Opportunities
 Horizontal Integration consists of companies that acquire a
similar company in the same industry.
 Companies may choose to undergo horizontal integration in order
to increase their size
 achieve economies of scale
 reduce competition
 to gain access to new customers or markets, including overseas.
Facebook's 2012 acquisition of Instagram
Disney's 2006 acquisition of Pixar
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33. Integrative Growth Opportunities
 Vertical Integration: It is an arrangement in which the supply
chain of a company is owned by that company ( backward
integration) or it might acquire some wholesalers or retailers
(forward integration)
 This strategy is important for many companies for several
reasons.
 It increase profits from the newly acquired operations by selling
its products directly to consumers
 It also guarantees efficiencies in the production process
 and cuts down on delays in delivery and transportation.
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34. Cont…
 A car manufacturer is undergoing a backward
integration if it acquires a tire manufacturer. This
ensures the manufacturer it has a steady supply of
tires in order to keep making its cars.
 A car manufacturer may acquire an automotive
dealership through forward integration. This not only
gets the manufacturer closer to the consumer, but it
also gives the company more revenue.
 Eg Ikea's 2015 purchase of forests in Romania to
supply its own raw materials
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35. Figure 2.3 The Business Unit
Strategic Planning Process
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36. SWOT Analysis
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37. SWOT Analysis
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Strengths
Weaknesses
Opportunities
Threats

38. SWOT Analysis
SW
.Strength
A strength is a resource or
capacity the organization can
use effectively to achieve its
objectives.
 Weaknesses
Weaknesses are negative and
internal factors that affect your
organizational successes
OT
 Opportunity
A market opportunity is an
area of buyer need and
interest that a company has
high probability of profitability.
 Threat
It is a challenge posed by an
unfavorable trend that in
absences of a defensive
marketing action would lead to
lower sales and profitability
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39. SWOT Analysis: Opportunities
 There are 3 main sources of market
opportunities
1) To offer something that is in short supply
2) To supply an existing product or service in
new superior way.
3) To ask consumers what do they want.
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40. Market Opportunity Analysis
(MOA)
 To evaluate opportunities, companies can
use MOA to ask question like.
1) Can we articulate the benefits convincingly
to defined a target market?
2) Can the target market be located and
reached with cost-effective media and trade
channels?
3) Does the company possess or have access
to the critical capabilities and resources
needed to deliver the customer benefits?
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41. Market Opportunity Analysis
(MOA)
 Can the company deliver the benefits better
than any actual or potential competitors?
 Will the financial rate of return meet or exceed
the company’s required threshold for
investment?
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42. Figure 2.4
Opportunity and Threat Matrices
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43. Goal Formulation
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44. Goal Formulation
 Once SWOT analysis is done, company can proceed to goal
formulation, developing specific goals for the planning period.
 Most business units have mix of objectives, including profitability,
market share, improvement, innovation, reputation etc.
 Must be arrange hierarchical, from most to least important.
 Objectives should be quantitative
 Goals should be realistic
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45. Strategy Formulation
2-46

46. Strategy Formulation
 Michael Porter has proposed three generic
strategies that provide a good starting point for
strategic thinking overall cost leadership,
differentiation, and focus.
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47. Porter’s Generic Strategies
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Overall cost leadership
Differentiation
Focus

48. Cont…
 With overall cost leadership, firms work to achieve the lowest
production and distribution costs so they can underprice
competitors and win market share.
 Differentiation strategy is built on a belief that one needs a clear
and unique positioning. Differentiation leadership focuses in
providing perks that add value for consumers.
 Focus: The business focus on one or more narrow market
segments, gets to know them and pursue with either cost
leadership or differentiation strategy.
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49. Strategic Alliances
 Even giant companies often cannot achieve
leadership, either nationally or globally, without
forming alliances with domestic or
multinational companies.
 Many strategic alliances take the form of
marketing alliances. These fall into four major
categories
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50. Categories of Marketing Alliances
 Product or service alliance
 Promotional alliance
 Logistics alliances
 Pricing collaborations
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51. Cont..
1. Product or service alliances—One company licenses
another to produce its product, or two companies jointly
market their complementary products or a new product.
Dominos & Coke..
2. Promotional alliances—One company agrees to carry
a promotion for another company’s product or service.
Happy Meal…
3. Logistics alliances—One company offers logistical
services for another company’s product. TCS, Fedex,
UPS…
4. Pricing collaborations—One or more companies join in
a special pricing collaboration. Hotel and rental cars…
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52. Implementation
 Proper implementation of the strategies, even
a great marketing strategy can be damaged by
poor implementation. Eg if the unit has
decided to attain technological leadership, it
must strengths its R&D department, train its
technical sales force etc.
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53. McKinsey’s Elements of Success
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Strategy
Structure
Systems
Style
Shared values
Staff
Skills

54. Marketing Plan Contents
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 Executive summary
 Table of contents
 Situation analysis
 Marketing strategy
 Financial projections
 Implementation controls

55. What is Corporate Culture?
Corporate culture is the
shared experiences, stories, beliefs,
and norms that
characterize an organization.
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56. 2-57
Evaluating a Marketing Plan
 Is the plan simple?
 Is the plan specific?
 Is the plan realistic?
 Is the plan complete?

57. For Review
 How does marketing affect customer value?
 How is strategic planning carried out at
different levels of the organization?
 What does a marketing plan include?
2-58