Part 3 Presented by Mr. Ahmed El Seddawy AASTMT

“Market-oriented strategic planning is the managerial process of developing and maintaining a practical fit between the organisation’s objectives, skills and resources and its changing market opportunities”. “The aim of strategic planning is to shape and reshape the company’s businesses and products so that they yield target profits and growth”. Kotler, P. (1997) Marketing management, (9th ed), Upper Saddle River, NJ: Prentice Hall International, p.63

 Competition - competitive forces, analysing competitors  Monitoring environmental change - managing strategic environmental issues  Opportunities - market and sales opportunity analysis  Competitive advantage - distinctive capabilities, cost and differentiation strategies, product differentiation strategies  Resource reviews  Strategic fit - fitting both market opportunities and internal capabilities

There are five types of company: 1.those who make things happen 2.those who think they make things happen 3.those who watch things happen 4.those who wonder what happened, and 5.those that did not know that anything had happened

 Planning is essential  It gives a sense of purpose and direction  Stops constant fire-fighting  Stops panicking  Put managers in control

 marketing strategy is a cycle of integrated actions leading to a sustainable competitive advantage  strategic marketing seeks to secure and maintain competitive advantage in order to meet the goals of the organisation  it involves consideration of the interaction of three key variables: external environment, organisation goals and strategies

E-Marketing Planning and Strategies vision corporate objectives marketing audit SWOT analysis formulate strategies forecasts budgets Implementation programme control Performance review and evaluation 1 objectives 2 situation review 3 strategies and plans 4 action Strategic Focus what business are we in? what business should we be in? what business should we not be in? identify opportunities target markets product, price, promotion and distribution strategies action: products, prices, promotion, distribution

 An e-marketing strategy needs to be fully integrated into an organisation’s business and marketing strategies and plans  Rather than have a separate e-marketing strategy it is important to have an integrated marketing plan with an e-marketing plan as a sub-set of that marketing plan

 E-marketing strategy as a detailed sub-set of overall marketing planning  But also part of the investment for a new web site  And part of the investment in upgrading and extending a website

E S P Legal-ethical Technology Competition Other factors markets internet SWOT E-business strategy Performance metrics E-marketing plan E-marketing strategy E-marketing mix CRM Environment-strategy-performance model Source: Strauss, El-Ansary & Frost (2006:23)

Environmental Influences 1. broad environmental variables: economy, technology, society 2. Industry variables: industry structure, lifecycle, specific technology, structure of competition, strategies and performance 3. market variables: lifecycle, segment structure, demand influences, purchase size and frequency

Goals (Objectives) sustainable competitive advantage as a means to sales, market share, profit and other objectives to satisfy stakeholders

PURPOSE why the company exists VALUES what the company believes in STRATEGY competitive position and distinctive competence STANDARDS AND BEHAVIOURS policies and behaviour patterns underpinning the distinctive competence and value system The Ashridge Mission Model

Target customer s suppliers Marketing and sales intermediaries publicscompetitors promotion product placeprice Demographic/ economic environment Political/ legal environment Technical/ physical environment Social/ cultural environment Marketing and sales information system Marketing organisation and implementation system Marketing planning system Marketing & sales organisation system Factors influencing company marketing strategies publics

Environmental factors e.g. rate of technological change nature of competition intensity of competition Strategic factors e.g. long-term objectives strategic time horizon product-market strategy Managerial factors e.g. communication attitudes leadership style Organisational factors e.g. size structure culture innovation capability Marketing factors e.g. use of market research customer service product quality Business Performance Source: after Baker & Hart (1989) Factors influencing competitive success

Strategies  bedrock strategy - to build and sustain capabilities of reputation, know-how, relationships, physical resources  then determine strategies to transform these into positional advantage vis a vis competitors  must derive strategies for market positioning in the chosen target segments  have strategies to deliver continuing customer satisfaction

Organisation capabilities Used to create value for customers Provide customers with desired benefits Careful assessment of these capabilities what capabilities to build analysis of opportunities choice of opportunities to address Value creation for customers Internet website and e- commerce

Creating value for customers  surest way of gaining and keeping competitive advantage is to create better value for customers  customer come back for more and a long- term customer relationship develops  The internet and development of e- commerce offers great opportunities for creating value for customers

 value-defining processes [influenced by e-marketing] ◦ market sensing to understand what customers value (what benefits buying) ◦ assess what the organisation creates from a customer perspective ◦  value-developing processes [influenced by e-marketing] ◦ what creates customer value in the value chain? ◦ how can customer value be enhanced through product and service development? ◦ what facilitates and inhibits better product or service delivery

 Value-delivering processes [influenced by e-marketing] ◦ can the product or service be better delivered? ◦ can it be made available at better times in better locations?  Value-maintaining processes [influenced by e-marketing ◦ customer linking, channel bonding, managing brand equity

 But customer expectations change  what customers consider excellent value today will probably be average value tomorrow  customers are increasingly demanding  this is exacerbated by competitors who see advantage in meeting these higher demands  other companies develop product and service enhancements which set new expectation standards  change is endemic and built-in to most markets  therefore, there is a need to continuously monitor and adapt

Potential benefits of an Internet site:  Improvement in corporate identity and image  Improved customer service  Increased visibility among targeted segments  Market expansion  Online transactions  Lower communication costs Source: Sterne (1999)

Website generations: 1. First generation: static electronic brochures, supplier broadcasting to many potential and existing customers 2. Second generation: interactive website, with product stock availability, FAQs and pricing information; still supplier driven 3. Third generation: fully interactive website, personalisation and market research information collection

Intended strategy Realised strategy Deliberate strategy Emergent strategy Unrealised strategy Deliberate and emergent strategies Source: Baker, M.J. (2000) Marketing strategy and management, (3rd Ed), Basingstoke: Macmillan

Intended strategy Desired objective Unpredictable factors Predictable factors Course plotted Source: Baker, M.J. (2000) Marketing strategy and management, (3rd ed), Basingstoke: Macmillan

Strategic planning calls for action on:  managing the company’s businesses as an investment portfolio (each business has a different profit potential so should allocate resources accordingly)  assessing each business by considering the market’s growth rate, the company’s position and fit in that market  strategy - each business needs to develop a game plan for achieving its long-run objectives

Demand price elasticity substitutes rate of growth cyclical, seasonal Market structure number of buyers and sellers product differentiation barriers to entry cost structures vertical integration diversification Conduct pricing behaviour product strategy and advertising research and innovation plant investment legal tactics Performance production and allocative efficiency progress, full employment equity Public Policy taxes and subsidies regulation price controls antitrust information Supply raw material technology product durability value/weight Basic Conditions The structure-conduct- performance paradigm

Threat of new entrants Bargaining power of customers Threat of substitute products or services Bargaining power of suppliers The industry jockeying for position among current competitors Porter’s five forces

corporate planning division planning business planning product planning E-marketing planning organising implementing action Measuring results diagnosing results taking corrective action Planning ImplementingControlling

Business mission External environment (opportunities and threats) Internal environment (strength and weaknesses analysis) Goal formulation Strategy formulation Programme formulation implementation Feedback and control Business strategic planning process SWOT Analysis

1. Objectives: what business do we want to be in? (where do we want to be?) 2. Situation Review: where are we now? 3. Strategies, Tactics and Plans: how do we get there?, how do we exactly get there? 4. Action and Control: doing it and asking did we get there?

Business definition Environmental situation Competitive situation Resources and capabilities Analysis of past performance Preliminary objectives Opportunities and threats Strengths and weaknesses Specification of present strategy Strategic thinking identify key issues develop strategy options Analysis resolve issues evaluate options Decisions strategy performance objectives

Corporate business planning Internet marketing plan (sub-set of marketing plan) Design website Implement website Monitor website Control, review, modify Source: adapted from Chaffey et al (2000: 124)

Baker, M.J. (2000) Marketing strategy and management, (3 rd ed), Basingstoke: Macmillan Chaffey, D. (2002) E-business and e-commerce management, Harlow: Financial Times Prentice Hall, Chapter 5: E-Business Strategy and Chapter 8: E- Marketing Chaffey, D., Mayer, R., Johnston, K. & Ellis-Chadwick, F. (2003). Internet marketing. (second edition). London: Pearson Education. Chapter 4: Internet Marketing Strategy (third edition 2006) Chaston, I. (2001) E-marketing strategy, London: McGraw-Hill Kotler, P. (1997) Marketing management, (9th edition), Upper Saddle River, NJ: Prentice Hall International Sterne, J. (1999) World wide web marketing (2 nd ed), New York: John Wiley Strauss, J. and R. Frost (2001) E-marketing, Upper Saddle River, NJ: Prentice Hall, Chapter 8: The E-Marketing Plan Strauss, J., El-Ansary, A. and R. Frost (2006) E-marketing, (4 th ed), Upper Saddle River, NJ: Prentice Hall, Chapter 3: The E-Marketing Plan