Company and Marketing Strategy

Chapter 2

Objectives
Understand companywide strategic planning and its four steps. Learn how to design business portfolios and develop strategies for growth and downsizing. Understand marketings role in strategic planning and how marketers partner with others. Be able to describe the marketing process and the forces that influence it. Understand the marketing management functions, including the elements of the marketing plan.

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Kotler It is more important to do what is strategically right than what is immediately profitable

Dwight D. Eisenhower

Plans are nothing Planning is everything

Would you tell me, please, which way I ought to go from here? asked Alice.
That depends a good deal on where you want to get, said the Cat. I dont much care where, said Alice. Then it doesnt matter which way you go, said the Cat.

Lewis Carroll Alices Adventures in Wonderland

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What is Planning?
Plan your career
What do you do? What do you start with? How do you plan?

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Strategic Planning - the Process of Developing and Maintaining a Strategic Fit Between the Organizations Goals and Capabilities and Its Changing Marketing Opportunities.

SW

OT

Figure 52

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Figure 2-1:

Steps in the Strategic Planning Process

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Strategic Planning
Mission statements should . . .
serve as a guide for what the organization wants to accomplish. be market-oriented rather than product-oriented. be neither too narrow, nor too broad. fit with the market environment. be motivating.
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To dedicate our business to the pursuit of social and environmental change.

To creatively balance the financial and human needs of our stakeholders: employees, customers, franchisees, suppliers and shareholders. To courageously ensure that our business is ecologically sustainable: meeting the needs of the present without compromising the future. To meaningfully contribute to local, national and international communities in which we trade, by adopting a code of conduct which ensures care, honesty, fairness and respect. To passionately campaign for the protection of the environment, human and civil rights, and against animal testing within the cosmetics and toiletries industry. To tirelessly work to narrow the gap between principle and practice, whilst making fun, passion and care part of our daily lives 2-8

Company

Product Definition

Market Definition

Amazon.com

We sell books, videos, CDs, We make Internet buying toys, consumer electronics, experience fast, easy, and and other products enjoyable we are the place where you can find and discover anything you want to buy online We make copying equipment We sell gasoline We make movies We run discount stores We help improve office productivity We supply energy We market entertainment We deliver low prices every day and give ordinary folks the chance to buy the same things as rich people ?
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Xerox

Standard Oil Columbia Pictures Wal-Mart

Nokia

SMART Objectives
earn an annual rate of return on investment over the next year of 15% after tax produce net profits of $ 2 000 000 in 20XX produce a cash flow of $ 4 000 000 in 20XX increase total sales revenue by certain % in 20XX achieve market share of 5% for brand A at market B in year C increase awareness of product or brand A at market B from 20% to 40% over the planning period expand the number of dealers by 10%... Increase customers knowledge of a product features make consumer attitudes more favorable
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Figure 2-1:

Steps in the Strategic Planning Process

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Designing the Business Portfolio

The business portfolio is the collection of businesses and products that make up the company. Ex. USKO, P&G, Mercur Group (Auto, Agro)
A variety of tools can be used: SWOT analysis, Competitor analysis BCG (Boston Consulting Group) Matrix Strategic-Planning Gap Model Product/ Market Expansion Grid Ansoffs Growth Matrix
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Figure 2-3:

Product / Market Expansion Grid

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Product/ Market Expansion Grid

Market Penetration: making more sales to current customers without changing its products. How? Add new stores in current market areas, improve advertising, prices, service or store design. Market Development: develop new markets for its current products. How? Identify new demographic or geographic markets. Product Development: offering modified or new products to current markets. How? New styles, flavors, colors, or modified products. Diversification: new products for new markets. How? Start up or buy new businesses.

Apply the product/ market expansion grid to:

1. Meloman store 2. Foodmaster 3. Elite Story ()
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Figure 2-1:

Steps in the Strategic Planning Process

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Figure 2-4:

The Marketing Process

Demographic/economic Technological/ physical environment

environment

Key Elements
Analyzing marketing opportunities Selecting target markets
Political/ legal environment Social/ cultural environment

Developing the marketing mix

Managing the marketing effort
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SPECIALIZED BICYCLE COMPONENTS Video + Assignment (0.5 points) Complete the first two steps in the Marketing Process for Specialized.
1. Analyzing marketing opportunities

INTERNAL analysis (resources, competences, skills, policies, etc.):

Strengthens Weaknesses

EXTERNAL analysis (economic, legal, customers, culture, distribution, suppliers, competition, etc.):
Opportunities Threats

2. Selecting target markets (list and briefly describe 2-3 markets)

3. Developing the marketing mix 4. Managing the marketing effort
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The Marketing Process

Key Elements
Analyzing marketing opportunities Selecting target markets Developing the marketing mix Managing the marketing effort
The strategic planning and business portfolio analysis processes help to identify and evaluate marketing opportunities. The purpose of the marketing process is to help the firm plan how to capitalize on these opportunities.
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The Marketing Process

Key Elements
Analyzing marketing opportunities Selecting target markets Developing the marketing mix Managing the marketing effort

The segmentation process divides the total market into market segments. Target marketing chooses which segment(s) are pursued. Market positioning for the product is then determined.
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The Marketing Process

Key Elements
Analyzing marketing opportunities Selecting target markets Developing the marketing mix Managing the marketing effort
Competitor analysis guides competitive marketing strategy development. Strategy leads to tactics via the marketing mix:
The Four Ps product, price, place, promotion (seller viewpoint) The Four Cs customer solution, cost, convenience, and communication (customer viewpoint)
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Figure 2-5:

The Marketing Mix

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The Marketing Process

Key Elements
Analyzing marketing opportunities Selecting target markets Developing the marketing mix Managing the marketing effort
Marketing analysis
Provides information helpful in planning, implementation, and control

Marketing planning
Strategies and tactics

Marketing implementation
Turns plans into action

Marketing control
Operating control Strategic control
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Figure 2-6:

Managing the Marketing Effort

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