This document provides an overview of key concepts in company and marketing strategy discussed in Chapter 2, including companywide strategic planning, designing the business portfolio, planning marketing through partnerships, marketing strategy and the marketing mix, and managing the marketing effort. Specific topics covered include defining a market-oriented mission, analyzing the current business portfolio, developing strategies for growth and downsizing, partnering through the value chain and value delivery network, segmenting and targeting markets, developing an integrated marketing mix, creating a marketing plan, organizing the marketing department, controlling marketing performance, and calculating return on marketing investment.

1. Chapter Two
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Chapter Two
Company and Marketing Strategy
Partnering to Build Customer
Relationships
Instructor: Mashnun Hassan

2. Company and Marketing Strategy
• Companywide Strategic Planning:
Defining Marketing’s Role
• Designing the Business Portfolio
Topic Outline
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• Designing the Business Portfolio
• Planning Marketing: Partnering to Build
Customer Relationships
• Marketing Strategy and the Marketing
Mix
• Managing the Marketing Effort

3. Companywide Strategic Planning
Strategic planning is the process of
developing and maintaining a strategic
fit between the organization’s goals and
Strategic Planning
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fit between the organization’s goals and
capabilities and its changing marketing
opportunities

4. Companywide Strategic Planning
• The mission statement is the
organization’s purpose, what it wants to
accomplish in the larger environment
Defining a Market-Oriented Mission
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accomplish in the larger environment
• Market-oriented mission statement
defines the business in terms of
satisfying basic customer needs

5. Companywide Strategic Planning
Business
objectives
• Build profitable
Marketing
objectives
• Increase
Setting Company Objectives and Goals
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• Build profitable
customer
relationships
• Invest in
research
• Improve profits
• Increase
market share
• Create local
partnerships
• Increase
promotion

6. Companywide Strategic Planning
The business portfolio is the collection
of businesses and products that make
up the company
Designing the Business Portfolio
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up the company
Portfolio analysis is a major activity in
strategic planning whereby
management evaluates the products
and businesses that make up the
company

7. Companywide Strategic Planning
Strategic business unit (SBU) is a unit
of the company that has a separate
mission and objectives that can be
Analyzing the Current Business Portfolio
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mission and objectives that can be
planned separately from other company
businesses
• Company division
• Product line within a division
• Single product or brand

8. Companywide Strategic Planning
Identify key businesses (strategic
business units, or SBUs) that make
up the company
Analyzing the Current Business Portfolio
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Assess the attractiveness of its
various SBUs
Decide how much support each
SBU deserves

9. Companywide Strategic Planning
• Difficulty in defining SBUs and
measuring market share and growth
• Time consuming
Problems with Matrix Approaches
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• Time consuming
• Expensive
• Focus on current businesses, not future
planning

10. Companywide Strategic Planning
Product/market expansion grid is a tool
for identifying company growth
Developing Strategies for Growth and
Downsizing
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for identifying company growth
opportunities through market
penetration, market development,
product development, or diversification

11. Companywide Strategic Planning
Developing Strategies for Growth and Downsizing
Product/Market Expansion Grid Strategies
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Market
penetration
Market
development
Product
development
Diversification

12. Companywide Strategic Planning
Market penetration is a growth strategy
increasing sales to current market
segments without changing the product
Developing Strategies
for Growth and Downsizing
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segments without changing the product
Market development is a growth strategy
that identifies and develops new market
segments for current products

13. Companywide Strategic Planning
Product development is a growth
strategy that offers new or modified
products to existing market segments
Developing Strategies
for Growth and Downsizing
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products to existing market segments
Diversification is a growth strategy for
starting up or acquiring businesses
outside the company’s current products
and markets

14. Companywide Strategic Planning
Downsizing is the reduction of the
business portfolio by eliminating
Developing Strategies
for Growth and Downsizing
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business portfolio by eliminating
products or business units that are not
profitable or that no longer fit the
company’s overall strategy

15. Planning Marketing
Value chain is a series of departments
that carry out value-creating activities to
Partnering to Build Customer
Relationships
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that carry out value-creating activities to
design, produce, market, deliver, and
support a firm’s products

16. Planning Marketing
Value delivery network is made up of
the company, suppliers, distributors,
Partnering to Build Customer
Relationships
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the company, suppliers, distributors,
and, ultimately, customers who partner
with each other to improve performance
of the entire system

17. Marketing Strategy and the
Marketing Mix
Market segmentation is the division of a
market into distinct groups of buyers
who have distinct needs,
Customer-Driven Marketing Strategy
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characteristics, or behavior, and who
might require separate products or
marketing mixes
Market segment is a group of consumers
who respond in a similar way to a given
set of marketing efforts

18. Marketing Strategy and the
Marketing Mix
Market targeting is the process of
evaluating each market segment’s
attractiveness and selecting one or
Customer-Centered Marketing Strategy
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attractiveness and selecting one or
more segments to enter

19. Marketing Strategy and the Marketing
Mix
Market positioning is the arranging for a
product to occupy a clear, distinctive,
and desirable place relative to
Customer-Centered Marketing Strategy
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and desirable place relative to
competing products in the minds of the
target consumer

20. Marketing Strategy and the Marketing
Mix
Marketing mix is the set of controllable
tactical marketing tools—product, price,
place, and promotion—that the firm
Developing an Integrated Marketing Mix
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place, and promotion—that the firm
blends to produce the response it wants
in the target market

21. Managing the Marketing Effort
Executive
summary
Marketing
situation
Threats and
opportunities
Market Planning—Parts of a Marketing Plan
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Objective and
issues
Action programs Budgets
Controls

22. Managing the Marketing Effort
Implementing is the process that turns
marketing plans into marketing actions to
accomplish strategic marketing objectives
Marketing Implementation
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• Successful implementation depends on
how well the company blends its people,
organizational structure, decision and
reward system, and company culture into
a cohesive action plan that supports its
strategies

23. Managing the Marketing Effort
Functional organization
Geographic organization
Marketing Department Organization
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Geographic organization
Product management organization
Market or customer management

24. Managing the Marketing Effort
• Controlling is the measurement and
evaluation of results and the taking of
corrective action as needed
Marketing Control
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corrective action as needed
• Operating control
• Strategic control

25. Measuring and Managing
Return on Marketing Investment
Return on marketing investment (marketing
ROI) is the net return from a marketing
investment divided by the costs of the
Return on Marketing Investment
(Marketing ROI)
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investment divided by the costs of the
marketing investment. Marketing ROI
provides a measurement of the profits
generated by investments in marketing
activities.