Developing marketing strategies and plans LECTURE WEEK 2 Developing marketing strategies and plans

Lecture questions How does marketing affect customer value? How is corporate and divisional strategic planning carried out? How is business unit strategic planning carried out? What is involved in developing a marketing plan?

Transitioning from sellers’ to buyers’ markets Competition Demanding customers Choices for customers Transformation of the value concept Fragmented market segments

Sequences in the value delivery process Figure 3.2 Repetitive sequences of the value delivery process Source: M. R. V. Goodman, Durham University

Nirmalya Kumar’s 3Vs marketing approach Define the value segment Define the value proposition Define the value network

The generic value chain Figure 3.3 The generic value chain Source: From M. E. Porter (1985) Competitive Advantage. Creating and Sustaining Superior Performance, New York: Free Press. Copyright © 1985 by Michael E. Porter. Reproduced with permission from The Free Press, a division of Simon & Schuster Adult Publishing Group

Core business processes The market sensing process The new offering realisation process The customer acquisition process The customer relationship management process The fulfillment management process

Characteristics of core competencies It is a source of competitive advantage It has applications in a wide variety of markets It is difficult for competitors to imitate

Steps in the business realignment process (Re)define the business concept (Re)shaping the business scope (Re)positioning the brand identity

Questions answered by the holistic marketing framework How can we identify new value opportunities? How can we efficiently create more promising new value offerings? How can we use capabilities and infrastructure to deliver the new value offerings more efficiently?

Organisational levels Corporate level Division level Business unit level Product level

What is a marketing plan? The marketing plan is the central instrument for directing and coordinating the marketing effort.

Figure 3.5 The strategic planning, implementation and control processes

Planning activities Defining the corporate mission Defining the business Assigning resources to each SBU Assessing growth opportunities

Definitions of business Product definition Market definition BP sells fuels Biersdorf sells cosmetics Renault sells automobiles Xerox makes copy equipment BP sells energy Biersdorf sells beauty Renault supplies transport vehicles Xerox improves office productivity

Major competitive spheres Industry Geographic Product Vertical Competence Market segment

Characteristics of SBUs It is a single business, or a collection of related businesses, that can be planned separately from the rest It has its own set of competitors. It has a manager responsible for strategic planning and profit performance

Figure 3.6 The strategic planning gap

Strategies for managing change Avoid the innovation title Use the buddy system Set the metrics in advance Aim for quick hits first Get data to back up your gut feelings

Figure 3.8 The business unit strategic-planning process

SWOT Analysis Figure 3.9 Using SWOT analysis to monitor the internal and external position of an organisation

Market opportunity analysis Can we articulate the benefits to a target audience? Can we locate the target market and reach them with cost-effective media and trade channels? Does our company possess or have access to the critical capabilities and resources we need? Can we deliver the benefits better than the competition? Will the rate of return meet or exceed our expectations?

Figure 3.10 Opportunity and threat matrices

Goal formulation and the MBO Arrange objectives hierarchically from most to least important Make goals quantitative if possible Make goals realistic Make goals consistent

Porter’s generic strategies Overall cost leadership Differentiation Focus

Forms of strategic alliances Product or service alliance Promotional alliance Logistics alliance Pricing collaborations

Elements of strategy Strategy Shared values Structure Staff Systems Skills Style

Contents of a marketing plan Executive summary and table of contents Situation analysis Marketing strategy Financial projections Implementation controls For some tips on how to write a marketing plan go to: www.youtube.com/watch?v=-ul65NjOMzo&feature=related

Contents of a marketing plan The Euromart marketing plan is based on an approach inspired by Professors Kashani and Turpin of the IMD in Switzerland: Executive summary Contextual analysis Customer analysis Competition analysis Company strategic approach Channel analysis (distribution and marketing communications) Cash analysis Marketing management implementation and control

Kotler on strategy In this video clip, Philip Kotler discusses some key strategic marketing issues for practitioners www.youtube.com/watch?v=bilOOPuAvTY

Recap: can you explain? How does marketing affect customer value? How is corporate and divisional strategic planning carried out? How is business unit strategic planning carried out? What is involved in developing a marketing plan?