Chapter 2 The Marketing Plan Marketing Planning Section 2.1 Marketing Planning Section 2.2 Market Segmentation

Market Planning Lesson 2.1

Marketing Planning Objectives Conduct a SWOT analysis Key Terms SWOT analysis environmental scan marketing plan executive summary situation analysis marketing strategy sales forecasts performance standard Objectives Conduct a SWOT analysis List the three key areas of an internal company analysis Identify the factors in an environmental scan Marketing Essentials Chapter 2, Section 2.1

Marketing Planning Good marketing relies on good plans Planning begins with looking at your business (internal) and the external business environment its operating in A business can analyze itself with a SWOT analysis: SWOT analysis - An assessment of a company’s strengths and weaknesses and the opportunities and threats that surround it; Strengths Weaknesses Opportunities Threats

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Purpose of each component? The SWOT Analysis helps because it: Strengths: Why would you want to know this? Lists everything a business does well (the company's advantages over its competitors) Positive factors in company’s control Weaknesses: Characteristics of a company that they don’t do well in comparison to competitors. (areas of competitive disadvantages) – Negative factors in company’s control Opportunities: External untapped markets or business developments or trends they could add/use to make their business better - Positive factors outside company’s control Threats: Elements of the external environment that could negatively affect the company, including technological, environmental and regulatory factors – Negative factors outside company’s control

SWOT Analysis Two Internal Factors What two components analyze internal factors that impact a business? Strengths and Weaknesses Two External Factors What two components analyze external factors that impact a business? Opportunities & Threats

C C C ompany ustomers ompetition Internal Anayslsis Internal Analysis looks at the Three Cs The three C’s of internal analysis What do you think the three “C”s are? C ompany C ustomers C ompetition

1. Company Analysis When evaluating itself, a company must analyze these areas: Company staff Financial situation Production capabilities The four Ps of the Marketing Mix: Product Place Price Promotion Marketing Essentials Chapter 2, Section 2.1

Company Analysis Company Staff Financial Questions: Do staff know and follow the mission statement Do we have strong executives Quality staff and enough staff – effectiveness of sales force Financial Questions: Are we profitable Sales history – are sales increasing or decreasing

Production Capabilities Company Analysis Production Capabilities What changes in technology are required to be competitive Has Research & Development created new successful products Percentage of sales from products older than 5 years

Marketing Mix (Four Ps Questions) Company Analysis Marketing Mix (Four Ps Questions) Product: What new products are successful and why Patent on any products or are any expiring Branding Image Price: What are present pricing strategies and are they working Promotion: Are promotional strategies successful Company’s reputation with it’s customers Place: Do products easily reach customers

2. Customer Analysis Companies study customer buying patterns using surveys or interviews with people in their target markets Who are the customers? How do groups of customers differ from one another? What do customer surveys and customer interviews reveal? What, when, where, and how much do they buy? How do customers rate the company on quality, service, and value? Is your customer base increasing or decreasing? Why?

Strengths and weaknesses compared to competitors 3. Competitive Position Strengths and weaknesses compared to competitors What is the company’s market share? Questions that help a company analyze its internal competitive position: What advantages does the company have over its competitors? What core competencies does the company possess? Are competitors taking business away? Why? Marketing Essentials Chapter 2, Section 2.1

NIKE Strengths: Weaknesses: Competitive Organization Strong at research and development Global brand Famous “swoosh” Weaknesses: Heavily in the footwear market Price sensitive – competitive market

McDonalds Strengths: McDonald's has successfully rolled out new items With a strong product offering, the company has grown income throughout the recession Operations are spread around the world Weaknesses It will be harder and harder to find prime locations to build a set of golden arches

Opportunities & Threats External Factor What two components of the SWOT analyze external factors that impact a business? Opportunities & Threats Marketing Essentials Chapter 2, Section 2.1

External Opportunities Businesses must always look for opportunities to create competitive advantage and avoid threats (do better than competition) This is done through: Knowledge of the Competition & Trends Environmental Scan Marketing Essentials Chapter 2, Section 2.1

External Opportunities 1. Opportunities can include new and emerging markets new business and product developments strategic business partnerships that may create more sales and profits (TACO Bell) Marketing Essentials Chapter 2, Section 2.1

Four Factors of a PEST Analysis 2. Threats environmental scan An analysis of outside influences that may have an impact on an organization. Businesses conduct an environmental scan X – analysis of outside influences that impact the organization The acronym PEST refers to each of the four main areas evaluated in the external scan: Political Economic Four Factors of a PEST Analysis Socio-Cultural Technological Marketing Essentials Chapter 2, Section 2.1

Socio-Cultural Factors PEST Analysis Government affects business operations Changes in Laws that affect business operation Changes in Regulations Political Issues Recession Unemployment Rate Currency Rates Import Pricing Trade Restrictions Economic Issues Customers and potential customers: Changes in attitudes, lifestyles, and opinions provide opportunities and threats Socio-Cultural Factors Embrace technology and innovate to stay competitive – broadband, licensing such as patents, new technology, IT usage Technology

McDonalds Opportunities: There are opportunities for new restaurants outside the United States, China is a great opportunity for the company, as is much of Asia. Menu innovations are limited only by imagination. Low interest rates provide cheap capital for growth. Threats Governments are considering regulations targeting fast food. McDonald's faces competition from strong peers such as recent Yum! Brands and Burger King. New product rollouts often have to go head-to-head with established players like Starbucks coffee or Jamba smoothies

Strengths Weaknesses Opportunities Threats

SMART Objective

From your SWOT, you learned a weakness you have is your sales are declining. While you carry a lot of different items, you notice your sweatshirt sales in the store are low. You decide to create a marketing plan around increasing your sweatshirt sales.

Increasing Sales using a SMART Goal? Increase the sale of Sweatshirts By 10% By increasing product options, marketing on social media, and having sales events To do so, I will need about three months to purchase and market By February 1, 2018

SMART Goal = Increase sales on Sweatshirts by 10% by February 1, 2018 Increase the sale of Sweatshirts By 10% By increasing product options, marketing on social media, and having sales events To do so, I will need about three months to purchase and market By February 1, 2018

Writing a Marketing Plan marketing plan X A formal written document communicating the goals, objectives, and strategies of a company’s activities for a specific time - written after conducting a SWOT Analysis Purpose: A Roadmap of how a product will enter the market, be advertised and sold It communicates to management: Company goals, objectives and strategies Specific responsibilities Budgets Deadlines for completion Overall performance

Elements of a Marketing Plan Six Elements of a Marketing Plan Executive Summary Written last – defines the entire plans key points Situation Analysis Your SWOT Single goal of what going to do as a company. Elements of a Marketing Plan Objectives Marketing Strategies 4ps: Product, Place, Price, Promotion When, how, and who will implement plan, budget Implementation Evaluation and Control Measurement on how you are doing