Pulling It All Together: Integrating and Analyzing the Marketing Plan Evans & Berman Chapter 22

Chapter Objectives To show the value of an integrated marketing plan To discuss the elements of a well-integrated marketing plan To present five types of marketing plan analysis: benchmarking, customer satisfaction research, marketing cost analysis, sales analysis, and the marketing audit To see the merit of anticipating and planning for the future

Organizational Planning Vision Driving Force Values ? Why are we in business? Mission Climate Strengths Weaknesses Opportunities Threats Competition Constraints Culture ? How do we do business? ? Where are we now? ? Where do we want to be? Strategies Gap Analysis Tactics ? How can we get there? Resources ? How will we know we’ve arrived? Coordination Reports Milestones Budgets Controls © Clark E. Crouch

The Value of an Integrated Marketing Plan An integrated marketing plan outlines the actions necessary, who is responsible, when and where they will be completed, and how they will be coordinated. The benefits may include: Improved profits Increased market share Greater return on assets and investments Opportunities for positive economies of scale Greater customer satisfaction leading to firm’s long-term success

A Total Quality Approach It is a process- and output-related philosophy, striving to satisfy customers effectively. It always: Seeks to satisfy customers Has a top management commitment Emphasizes continuous improvement Requires support from employees, suppliers, and distribution intermediaries

Elements Leading to a Well-Integrated Marketing Plan Clear Organizational Mission Stability Over Time Long-Term Competitive Advantages Well-Integrated Marketing Plan Coordination of the Marketing Mix Precisely Defined Target Market(s) Coordination Among SBUs Compatible Long-, Moderate-, and Short-Term Subplans

Step 1. in a Well-Integrated Marketing Plan A clear Organizational Mission outlines a commitment to a type of business and a place in the market. It should be reviewed reviewed when: A firm seeks new customer groups or abandons existing ones. Adds or deletes product lines. Acquires other firms or sells part of its own business. Utilizes different marketing functions. Shifts its technological focus. 1. Clear Organizational Mission

Step 2. in a Well-Integrated Marketing Plan Long-term competitive advantages are attributes whose distinctiveness and appeal to consumers can be maintained over an extended period of time. To sustain advantages, consumers must perceive a consistent positive difference in key attributes over firm’s competitors. Differences must be linked to a capability gap that competitors will have difficulty in closing. A firm should stress customer service and a total quality program. 2. Long-Term Competitive Advantage

Step 3. in a Well-Integrated Marketing Plan By precisely defining target market(s), a firm identifies those to be addressed in its marketing plans. When a firm uses concentrated or differentiated marketing, each segment must be understood. The target market approach may need fine-tuning due to changing demographics and lifestyles—or declining sales. Data-base marketing aids in achieving goals. 3. Precisely Defined Target market

4. Compatible Long, Moderate, & Short-Term Subplans Step 4. in a Well-Integrated Marketing Plan A firm’s marketing subplans need to be compatible with one another. Long-term plans are the most general and set a broad framework for moderate-term plans. Short-term plans are the most specific, but need to be derived from both moderate- term and long-term plans. Marketing plans must be flexible and adapt to changing customer priorities. Frequent reviews are critical. 4. Compatible Long, Moderate, & Short-Term Subplans

Step 5. in a Well-Integrated Marketing Plan 5. Coordination Among SBUs Coordination among an organization’s SBUs is enhanced when the functions, strategies, and resources allocated to each are described in long-, moderate-, and short-term plans.

Step 6. in a Well-Integrated Marketing Plan 6. Coordination of Marketing Mix The components of the marketing mix (product, distribution, promotion, and price) need to be coordinated and consistent with the firm’s organizational mission.

Step 7. in a Well-Integrated Marketing Plan A marketing plan must have a certain degree of stability over time to be implemented and evaluated properly. The plan should be consistent with the firm’s mission and guide the firm’s long-term efforts. The plan should be fine-tuned regularly and be consistent with the firm’s total quality approach. 7. Stability Over Time

The Keys to Good Benchmarking By benchmarking, a firm sets its marketing standards based on prior actions by the firm, direct competitors, the best companies in its industry, and/or innovative companies in other industries. The Keys to Good Benchmarking 1. Determine What to Benchmark 2. Build Buy In and Plan the Project 3. Understand Existing Operations 4. Research Others’ Practices and Potential Partners 5. Identify Best Practices 6. Pinpoint Improvement Areas 7. Conclude and Communicate 8. Create an Action Plan for the Future

Customer Satisfaction Research Customer satisfaction is the degree to which there is a match between a customer’s expectations of a good or service and its actual performance. It “is undoubtedly one of the top strategic issues in the new decade.” The largest ongoing research project is the American Customer Satisfaction Index (ACSI), a joint effort by the University of Michigan, the American Society for Quality Control, and CFI Group. To compute ACSI, 50,000 consumers are surveyed annually regarding 200 companies and government agencies in 34 different industries. ACSI links customer expectations, perceived quality, and perceived value to customer satisfaction.

Marketing Cost Analysis Marketing cost analysis evaluates the cost efficiency of marketing factors such as total quality configurations, product lines, order size, distribution methods, sales territories, channel members, salespersons, advertising media, and customer types. It consists of three steps: Studying natural account expenses Reclassifying natural accounts into functional ones Allocating functional accounts by marketing classification

Sales Analysis Sales analysis is the detailed study of sales data to appraise the appropriateness and effectiveness of a marketing strategy. Without it, A poor response to the total value chain offered by a firm may not be seen early enough. The strength of certain market segments and territories may be overlooked. Sales effort may be poorly matched with market potential. Trends may be missed. Support for sales personnel may not be forthcoming.

Key Concepts in Sales Analysis Control units are the sales categories for which data are gathered. The 80-20 principle identifies large proportions of sales (profits) that come from a small proportion of customers, products, or territories. The iceberg principle states that superficial data are insufficient to make sound evaluations and errors will occur unless firms isolate and categorize data. Sales exception reporting highlights situations where goals are not met or opportunities are not present.

The Marketing Audit A marketing audit is a systematic, critical, impartial review and appraisal of the basic goals and policies of the marketing function, and of the organization, methods, procedures, and personnel employed to implement the policies and achieve the goals.

The Marketing Audit Process (1) 2. Determining When and How Often Audit Is Conducted 3. Determining the Areas to Be Audited 4. Developing Audit Forms 1. Determining Who Does the Audit 6. Presenting the Results to Management 5. Implementing the Audit

The Marketing Audit Process (2) 1. The audit is conducted by company specialists, company division or department managers, or outside specialists. 2. It may be done at the end of a calendar year, the of the annual reporting year, or when doing a physical inventory. 3. A horizontal audit studies the overall performance of a firm, emphasizing the interrelationship of variables. A vertical audit is an in-depth analysis of one aspect of a firm’s marketing strategy. 4. Audit forms list the topics to be examined and the exact information required to evaluate each topic. 5. Implementation decisions include: the timing and duration, employee awareness, when and how audit is performed, and how the audit report will be prepared. 6. Findings and recommendations are given to management.

Chapter Summary This chapter shows the value of an integrated marketing plan. It discusses the elements of a well-integrated marketing plan. It presents five types of marketing plan analysis: benchmarking, customer satisfaction research, marketing cost analysis, sales analysis, and the marketing audit. It shows the merit of anticipating and planning for the future.