CHAPTER 12 MARKETING PLANNING part four: managing marketing

an opening challenge Your uncle runs a shoe factory that is struggling to compete with cheaper, developing-world manufacturers. He knows you’ve done a business course so he invites you to a management meeting to discuss the way forward. Do you have anything to contribute?

agenda organising for marketing marketing planning business mission and marketing objectives marketing strategy marketing operations evaluation and control

functional organisation board financeHRmktgops

geographic (regional) head office ScotlandWales N. England S. England function or product/brand

board frozen food baked goods confec- tionery pet food functions

matrix organisation marketing HRaccounting head ug studies head pg studies research degrees

how to plan AQ – re-set figure type

blocks to marketing planning hierarchical management structures vertical communications horizontal communications turf battles power struggles functional silos

McKinsey 7S model AQ – re-set figure type and enlarge figure

seven key planning questions 1.where are we now? 2.how did we get here? 3.where will we be (if we continue to do the same things)? – identifies the strategic gap 4.where do we want to be? 5.how are we going to get there? 6.are we getting there? 7.have we arrived?

the strategic gap planning period strategic gap objective current projection

marketing planning where are we now? how are we going to get there? are we getting there? have we arrived? where do we want to be? marketing analysis marketing objectives marketing strategy and tactics marketing evaluation and control

marketing analysis e.g. PRESTCOM e.g. SWOT e.g. capability analysis or Porter’s five forces e.g. segmentation

Porter’s five forces industry attractiveness barriers to entry threat of substitutes inter-rivalry of competitors power of suppliers power of buyers

barriers to entry costs power of existing brands market size laws and regulations unavailability of key resources existing companies with significant economies of scale competitor reactions

threat of substitutes the pricing of substitute products switching costs loyalty levels

bargaining power of buyers customers (buyers) are powerful when: there are few large buyers in the marketplace products are commoditised or standardised the company is not a key supplier from the customer’s perspective

bargaining power of suppliers suppliers are powerful when: there are few alternative sources of supply suppliers could integrate along the supply chain and so become competitors there are high switching costs the company’s business is not key to the supplier

inter ‐ rivalry of competitors the intensity of rivalry may depend on: number of competitors cost structure differential advantages of products/brands switching costs competitors’ strategic objectives exit barriers

a good business mission statement identify the company’s philosophy – i.e. its approach to business specify its product–market domain communicate its key values be closely linked to critical success factors

typical marketing objectives increase market/brand share become no. 1 brand in xxx market launch new product move into new market increase awareness re-position as… all objectives should be SMART!

specific measurable achievable relevant timed SMART

marketing strategy has a broad view of how objectives will be reached incorporates: – branding, targeting, positioning, growth, competitive stance breaks down into strategies for individual marketing mix elements follows on from objective setting includes a framework for more detailed plans

generic competitive strategies (Porter, 1985) broad segments niche cost focus different- iation cost focus different- iation stuck in the middle

Ansoff’s matrix products markets existing new/related new/ related market penetration market development product development diversification

reasons to trade in overseas markets as a growth strategy as part of a competitive strategy risk spreading the globalisation of markets to offload excess capacity to extend the product life cycle

market selection criteria market’s potential for profit, sales legal system market accessibility marketing infrastructure product life cycle potential economies of scale strength of existing competitors level of risk

market screening company’s experience of similar markets cultural matches – e.g. language opportunities for standardisation – and thus reduced costs

international strategy: standardisation economies of scale consumer mobility communications technology cost of investment falling trade barriers cultural insensitivity income levels culture and language climate differing use conditions governments local market conditions local skills company history and operations drivers: restrainers:

marketing implementation (tactics) money men minutes

implementation: McKinsey’s seven Ss shared values skills strategy style systems staff structure

typical marketing plan headings 1.executive summary 2.current marketing situation 3.objectives 4.target markets 5.marketing strategies 6.marketing programmes 7.resources and budgets 8.implementation controls

evaluation and control plan correctcompare measureact

summary plans must be based on sound analysis – understand the market plans should be flexible and monitored – the market changes strategy is designed to meet objectives objectives should be SMART tactics are the detail of the strategy – how it will be implemented

reference Porter (1985) – detail to be added (AQ)