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Eleven Tips To Build Your Strategic Marketing Planning

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Strategic Marketing Planning

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Eleven Tips To Build Your Strategic Marketing Planning

  1. 1. Andre J. Vonk MBA
  2. 2. <ul><li>The master key to a successful business entry is a well considered Strategic Marketing Planning to guide the neccesity of actions and thoroughgoing analytical review of the implemented road to drive. After all, your business choices deserve the best results in order to establish a healthy growth of your stakeholders value. </li></ul><ul><li>Nevertheless 6 out of 10 implemented plans fail as a result of illusions carried out by the daily business operations and wishful thinking. </li></ul>
  3. 3. <ul><li>A SIMPLE QUESTION: </li></ul><ul><li>IF YOU STEP INTO YOUR CAR, DO YOU KNOW </li></ul><ul><li>WHERE TO YOU WILL DRIVE?... </li></ul><ul><li>AND HOW YOU WILL GET THERE? </li></ul><ul><li>I GUESS I KNOW THE ANSWER… </li></ul>
  4. 4. <ul><li>Here are: </li></ul><ul><li>ELEVEN WAYS TO BUILD YOUR STRATEGIC MARKETING PLANNING </li></ul>
  5. 5. <ul><li>This clearly sets out the raison d’être of the SBU. It should state briefly… </li></ul><ul><li>1* Role or contribution of unit </li></ul><ul><li>2* Definition of business </li></ul><ul><li>3* Distinctive competence </li></ul><ul><li>4* Indication for future direction </li></ul>
  6. 6. <ul><li>Corporate objectives identify a company's quantifiable plans for improvement. These strategic or financial objectives can range from long-term goals to short-term ones that can be accomplished through day-to-day activities. </li></ul><ul><li>Focus on the following ideas: </li></ul>
  7. 7. <ul><li>Growth </li></ul><ul><li>Grabbing a larger share of the market is an important objective for small and large businesses alike. A corporate objective should be based on growth, affects the way the business will run overall, including how people are/will be hired and trained, customer interactions, product development and tactics for dealing with the competition. </li></ul><ul><li>Employee Development </li></ul><ul><li>Without well-trained, highly motivated staff, it's difficult for businesses to succeed at producing quality products and services or proper customer care. Because of this, your businesses should opt to include employee development as one of the corporate objectives. Development can include anything from providing training to assisting with educational pursuits. </li></ul>
  8. 8. <ul><li>Profit </li></ul><ul><li>If you're in business, your ultimate goal is generating profit from the products and services you sell. Whether your corporate objective is to increase sales by 20 percent for the year or to increase net profit margins from 1 percent to 3 percent, profit is a huge factor in strategically planning your business's next moves. </li></ul><ul><li>Customer Service </li></ul><ul><li>Without continuous, renewed dedication to your customers, it's impossible for your business to show growth in market share or profits. Don’t forget, customers are at the center of your business, so they should also be at the center of each corporate objective you define for your business. A corporate objective focusing on customers will create better ways for your customers to communicate with you or to develop an incentive program to reward your loyal customers. </li></ul>
  9. 9. <ul><li>The Marketing Audit is a comprehensive, systematic, subjective and periodic examination of the company’s trade environment, strategy, organization, systems, productivity and functions with a view to determining problem areas and opportunities. </li></ul><ul><li>The result should be a plan of action aimed at improving the company’s trade marketing performance. </li></ul>
  10. 10. <ul><li>The marketing audit should contain: </li></ul>market structure market trends Competitive forces new entrants power of supplier power of buyer Substitute Product and services Market overview * Current rivals Key Market Segments segmentation based on…: * What is bought? Who buys? Why? * Gap Analysis Product life cycle analysis Diffusion of innovation 1 = Productivity 2 = Market penetration 3 = New Products/Markets 4 = Investment Now 3 yrs TIME
  11. 11. <ul><li>STRENGHTS </li></ul><ul><li>WEAKNESSES </li></ul><ul><li>OPPORTUNITIES </li></ul><ul><li>THREATS </li></ul>Consider only major segments Techniques for swot analysis 1. Critical Success Factor Analysis 1 2 3 Example Competitors WE A B C Note: Only critical factors are to be considered. Usually not more than 5. Column 1 Weighting according to importance (totals 100) Column 2 Score relating to performance (out of ten) Column 3 Column 1 x Column 2 Column ABC Competitors scored similarly PRICE 50 7 350 QUALITY 30 6 180 DELIVERY 20 4 80 350 180 80
  12. 12. <ul><li>2. Scenario Building / Environmental Scan </li></ul>Establish how changes in the following will affect business in the planning period. <ul><li>Technology </li></ul><ul><li>International Trade </li></ul><ul><li>General Economy </li></ul><ul><li>Socio-Political factors </li></ul><ul><li>Demographics </li></ul><ul><li>Market factors </li></ul><ul><li>Competition </li></ul>3. Prioritising opportunities & threats Likelihood of Happining High Med Low Low Med High Impact A C T I O N (Threats or Opportunities)
  13. 13. <ul><li>Broad assumptions go from the top down, </li></ul><ul><li>but the detailed plans come from the bottom up. </li></ul><ul><li>The assumptions are for you the strategic drivers of the marketing plan and they may relate to economic, technological or competitive factors. </li></ul><ul><li>Assumptions should be based on your accurate information and sensible estimates of what can be achieved in the light of past performance. </li></ul><ul><li>Sound information is more problematic because the pace of change is making the future discontinuous from the past. Don’t predict exactly what is going to happen, but you must contend with a variety of possibilities as you implement your plan. </li></ul><ul><li>Your stated assumptions should explain why certain objectives should be developed. Those who will read your plan can judge whether or note the assumptions are valid or reasonable. </li></ul>
  14. 14. <ul><li>* COMING UP WITH VIABLE AND CHALLENGING ASSUMPTIONS INVOLVES CREATIVE, LATERAL THINKING AND BREAKING WITH THE PAST. </li></ul><ul><li>* ONLY A FEW MAJOR ASSUMPTIONS SHOULD BE INCLUDED IN THE PLAN WITH A MAXIMUM OF 5 </li></ul><ul><li>* TYPICAL ASSUMPTIONS COULD / SHOULD BE RELATED TO THE FOLLOWING CONDITIONS: </li></ul>KEEP IN MIND Change in the gross national product Anticipated inflation rate Status and projected objectives of key competitors Raw material availability and cost Consumer disposable income Anticipated interest rates Government regulations Expected new innovations Market size Competitor action <ul><li>ASSUMTIONS MUST BE: </li></ul><ul><li>Explicit </li></ul><ul><li>Few in numbers </li></ul><ul><li>Agreed by key managers </li></ul><ul><li>Related to issues in SWOT </li></ul>
  15. 15. <ul><li>As part of its planning process, a company has to analyze its business portfolio from time to time. A business portfolio is the collection of businesses and products that make up the company. </li></ul><ul><li>A Strategic Business Unit is an independent unit within the company that has his its own mission and objectives. SBU could be in form of business division, product line within a division or even a single product or brand. </li></ul><ul><li>Analysis of business portfolio requires a clear understanding on attractiveness based on its current growth and market share. One of the most well known powerful tools to do this is the BCG Matrix, developed by the Boston Consulting Group. Better known as the Boston matrix. </li></ul>
  16. 16. <ul><li>In the BCS Matrix, each SBU fall in to one of the four cells called: </li></ul><ul><li>Stars are high-growth, high-share business or products. They often need heavy investment to finance their rapid growth. Eventually their growth will slow down and they will turn into cash cows. </li></ul><ul><li>Question marks are low-share business with high-growth markets. They require a lot of cash to hold their share. Management has to think hard which question marks to build into star and which ones to phase out. </li></ul><ul><li>Cash Cows are low-growth, high-share business or products. These established and succeed SBU’s need less investment to hold their market share. They produce a lot of cash that the company uses to pay its bills and to support other SBU’s that need investments. </li></ul><ul><li>Dogs are low growth, low share business and products. They may generate enough cash to maintain themselves but do not promise to large sources of cash. </li></ul>Stars Question marks Cash Cows Dogs
  17. 17. <ul><li>Action to take: Once you have classified the company SBU’s, it must determine what role each will play in the future. Further, you have to decide whether to build, hold, harvest or even divest the SBU. </li></ul><ul><li>Dynamic’s of SBU’s: The SBU’s represented by circles in the BCG Matrix are dynamic. As time passes, they will change from one cell to another cell, as they have their own life cycle. Many SBU’s start with Question marks and move into star category if they succeed. They later become cash cows as market growth fall, then finally die off or turn in to the end of their life cycle. </li></ul>
  18. 18. <ul><li>Circles in the BCG growth-share matrix represent a company’s current SBU. The size of the circle depicts the volume of the company’s business in the currency value. </li></ul>Grow to! Out? Out? Market Share Business Growth < invest
  19. 19. <ul><li>This is your central step in the marketing planning process because the setting of achievable and realistic objectives is based on the analysis of the marketing audit, while strategy decisions cannot be made without reference to objectives. </li></ul><ul><li>Marketing objectives are concerned with which products are to be sold in which markets: it is important for you not to confuse objectives (what you want to do) with strategies (how you are going to do it). The objectives should be included in the plan. </li></ul>KEEP IN MIND Risk increases with increasing newness of products and / or markets
  20. 20. <ul><li>The broad methods by which the marketing objectives should be achieved and described by the means of doing so within the required time are generally referred to as the marketing mix or as the four P’s in the </li></ul><ul><li>Basic Marketing Mix . </li></ul><ul><li>However, you should not limit yourself to these well-known four P’s. Due to further development in the marketing field, these have increased to the broader seven P’s, as these are much more profound to embrace your plan and strategic road to a healthy implementation and source to … success. </li></ul>Product Price Place Promotion
  21. 21. FOCUS
  22. 22. <ul><li>Relatively few strategic marketing plans are blessed with budgets for professional market research. When you can’t pass the problem to professionals, then you have to make some intelligent estimates. </li></ul><ul><li>Get comfortable with the idea of making good educated guesses. Many people think there is something magic about this, don’t worry about it. Having gone through graduate business school ,I can reassure you: sophisticated data analysis rarely works very well for business forecasts. No matter how elaborate the forecasting model, mathematical forecasts are based on past results. Nobody knows the future. </li></ul><ul><li>In most situations, the best way to create a market forecast estimate is to find an expert forecast already published, estimate from past data, find parallel data or apply a model. </li></ul><ul><li>Many expert forecasts are published where you can obtain their results for free. Some of these are government forecasts intended to be free, some are expert forecasts made during interviews or news media coverage, and some are professional forecasts whose highlights are released to the media as teasers to sell the more expensive research. </li></ul><ul><li>Where yours might be found depends on your industry and the exact nature of your business. Unfortunately, nobody but you can pinpoint exactly where to look for your industry and your plan, but at least you can consider some examples. </li></ul>KEEP IN MIND: TRIGGER YOUR STAFF FROM SCRATCH TO GET THEIR VIEWS ON THE SPECIFIC EXPECTED ESTIMATIONS
  23. 23. <ul><li>Everyone should understand the Strategic Marketing Plan. It is advisable to make a presentation of it rather than to circulate written copies. If the Strategic Marketing Plan is not effectively communicated, I can assure you, it will fail. </li></ul><ul><li>Develop a strategic communication plan along the way to the final stage, it will be less overwhelming if it is presented in a continuously process of a pro active and frequent approach to building a better understanding in all levels and commitment. </li></ul>KEEP IN MIND: Driving your car with passengers to a destination without their knowing where they go to, will create chaos and a bunch of uncertainties during your trip. In best circumstances you will definitely end up somewhere else. Most likely you will leave screaming the car.
  24. 24. <ul><li>The plan should be monitored as it progresses. Make sure the measures you collect are meaningful to the success of the plan. If circumstances change, it should be revised to take advantage of unforeseen opportunities or to counter unforeseen threats. </li></ul><ul><li>Despite the best planning, changing situations can force marketing objectives and strategies to be altered or entirely scrapped. </li></ul><ul><li>As earlier mentioned nobody can predict the future, it is important for you to review long range strategic marketing goals each year. The short-range goals can easily be analyzed, reevaluated, refocused and updated on a monthly, bimonthly or quarterly basis to meet the long-range goals. At year-end, summarize the problems, ideas and changes necessary to write the next year’s short-range planning. </li></ul>KEEP IN MIND: <ul><li>Be specific to the adjustments </li></ul><ul><li>Don’t be influenced by the illusions of the day </li></ul>
  25. 25. <ul><li>DO’S </li></ul><ul><li>Be clear on the organization’s strategic objectives </li></ul><ul><li>Adjust the plan to suit the size, culture and circumstances of the organization </li></ul><ul><li>Consult on and communicate the plan </li></ul><ul><li>Be aware that it is a time consuming exercise </li></ul><ul><li>DON’TS </li></ul><ul><li>Confuse objectives (what you want to achieve) with strategies (how you are trying to achieve them) </li></ul><ul><li>Neglect to analyze information carefully, nor spend too long on projecting future markets from historical data. </li></ul><ul><li>Forget the plan is a means to achieve objectives, not a rigid control mechanism </li></ul><ul><li>Let planners alter the shape of the objectives </li></ul>
  26. 26. <ul><li>Be aware of barricades during your implementation travel of the </li></ul><ul><li>Strategic marketing plan. </li></ul><ul><li>THE BARRIERS COULD BE… </li></ul><ul><li>Confusion between Strategy & Tactics </li></ul><ul><li>Marketing function isolated from operations </li></ul><ul><li>Confusion between marketing function and marketing concept </li></ul><ul><li>Lack of in-depth analysis </li></ul><ul><li>Confusion between process and output </li></ul><ul><li>Lack of knowledge and skill </li></ul><ul><li>Lack of systematic approach </li></ul><ul><li>Failure to prioritize objectives </li></ul><ul><li>Hostile corporate climate which gives only lip-service to marketing </li></ul><ul><li>Organization “frozen” in old, outdated “tribal” territories – unwillingness to change. </li></ul>
  27. 27. <ul><li>The Strategic Marketing Plan is giving you now a comprehensive overview of your strategic marketing planning. It covers the whole process of planning your strategic marketing planning. </li></ul><ul><li>You'll now be able to put in place the best possible marketing strategy to meet your company's objectives in the months and years ahead. </li></ul><ul><li>KEEP FOCUSSED TO YOUR DEFINED STRATEGIC MARKETING PLAN </li></ul><ul><li>AS A PLAN, IS A PLAN, IS A PLAN… </li></ul>

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