Copyright John Wiley & Sons 2007 Presentation prepared by Robin Roberts, Griffith University and Mike Spark, Swinburne University of Technology

Copyright John Wiley & Sons 2007 Chapter 2 Planning marketing strategies

Copyright John Wiley & Sons 2007 Chapter 2 Chapter Objectives 1.Describe the strategic planning process 2.Explain how organisational resources and opportunities affect the planning process 3.Understand the role of the mission statement in strategic planning 4.Examine corporate, business unit and marketing strategies

Copyright John Wiley & Sons 2007 Chapter 2 Chapter Objectives 5.Understand the process of creating the marketing plan 6.Describe the different approaches to marketing strategy formulation

Copyright John Wiley & Sons 2007 Chapter 2 The Auskick program - a component of the AFL’s marketing strategy Dial-UpBroadband

Copyright John Wiley & Sons 2007 Chapter 2 Understanding the strategic planning process From a marketing point of view, the strategic planning process is: Establishing organisational mission and formulating goals, corporate strategy, marketing objectives, marketing strategy and marketing plan

Copyright John Wiley & Sons 2007 Chapter 2 Components of Strategic Planning Source: Thomson Learning and Houghton Mifflin Company

Copyright John Wiley & Sons 2007 Chapter 2 How important is planning in marketing? Neil Paterson, Director of Sales and Marketing, Sofitel Hotel, Gold Coast Dial-UpBroadband

Copyright John Wiley & Sons 2007 Chapter 2 Marketing objectives and strategy Marketing objectives (goals) must be: aligned to the corporate strategy designed to be achieved through efficient use of all of the organisation’s resources Marketing strategy identifies and analyses target markets develops Marketing Mixes to satisfy the customer needs

Copyright John Wiley & Sons 2007 Chapter 2 Assessing organisational resources and opportunities The process begins with an analysis of the marketing environment, which impacts overall corporate goals and resource availability, but also provides opportunities! Identify market opportunities, each of which will have a strategic window A competitive advantage occurs when a market opportunity is matched by one’s resources

Copyright John Wiley & Sons 2007 Chapter 2 SWOT Analysis Strengths and Weaknesses are internal factors that can be directly controlled Opportunities and Threats are external factors that exist independently and are beyond the organisation’s control

Copyright John Wiley & Sons 2007 Chapter 2 Strengths – core competencies that confer an advantage when meeting target market needs Weaknesses – limitations faced in developing or implementing a marketing strategy Opportunities – favourable environmental conditions that could produce rewards for the firm if acted upon properly Threats – conditions or barriers that may prevent achievement of objectives SWOT Analysis

Copyright John Wiley & Sons 2007 Chapter 2 The 4-cell SWOT Matrix Source: Elsevier Science

Copyright John Wiley & Sons 2007 Chapter 2 Conduct a SWOT analysis for Australian Canegrowers Dial-UpBroadband

Copyright John Wiley & Sons 2007 Chapter 2 Levels of strategic planning

Copyright John Wiley & Sons 2007 Chapter 2 Mission statement Mission statement is a long-term view or vision of what the organisation wants to become. Identifies: our customers? what is our core competency? customer needs and wants gives direction to the organisation to stay competitive marketplace

Copyright John Wiley & Sons 2007 Chapter 2 An organisation’s goals and objectives are derived from its mission statement Goals focus on the end results sought (where you want to be) Objectives state what is to be accomplished (what you want to do) Establishing organisational goals

Copyright John Wiley & Sons 2007 Chapter 2 Toyota Australia’s Marketing Goals What specific objectives might Toyota develop in order to achieve their marketing goals? Dial-UpBroadband

Copyright John Wiley & Sons 2007 Chapter 2 Corporate Strategy — a strategy that determines the means for utilising resources in the various functional areas to reach the organisation’s goals. Corporate strategy is the broadest level, and leads down to Business-unit strategy, which leads to Functional strategy Corporate strategy

Copyright John Wiley & Sons 2007 Chapter 2 A Strategic Business Unit is a division, product line or other profit centre within the parent company Business-unit Strategy is concerned with operational issues impacting a particular part of an organisation (called an SBU), and attempts to match the specific divisional or departmental resources with the target market’s needs and wants Business-unit strategy

Copyright John Wiley & Sons 2007 Chapter 2 The BCG Matrix Source: Boston Consulting Group

Copyright John Wiley & Sons 2007 Chapter 2 Marketing strategy The next step is the development of sound strategies for each functional area of the organisation: –Manufacturing –Research and Development (R&D) –Logistics (Warehousing and Distribution) –Human Resources –Finance and Accounting –Service operations –Marketing

Copyright John Wiley & Sons 2007 Chapter 2 Marketing strategy (cont’d) Marketing Strategy is concerned with operational issues impacting the marketing function within an organisation. It is the most specific and detailed (and final) part of the strategic planning process.

Copyright John Wiley & Sons 2007 Chapter 2 Target market selection Target market must be carefully selected before the marketing mix can be adapted to meet the target market’s needs and preferences. Selection of an accurate target market is crucial to the survival of the organisation Evaluate the impact of entry to the target market on the firm’s sales, costs and profits Maintain consistency with the corporate objectives and mission

Copyright John Wiley & Sons 2007 Chapter 2 Marketing mix The selection of a target market is the basis for creating a marketing mix to position a product or service to satisfy that market’s needs Careful, in-depth research into the traits of the target market must be undertaken. Marketing mix decisions must be both consistent and flexible and aligned with the corporate and business objectives

Copyright John Wiley & Sons 2007 Chapter 2 Competitive advantage The marketing mix will detail how the organisation will achieve a competitive advantage — that is, perform better than the competition.

Copyright John Wiley & Sons 2007 Chapter 2 Competitive advantage A sustainable competitive advantage (SCA) is one that the competition cannot copy. SCA can be based on: –Product Quality –Product features –Innovation –Price –Support and after-sales service –Distribution –Strong brand name

Copyright John Wiley & Sons 2007 Chapter 2 TQM is the philosophy that uniform commitment to quality in all areas of the organisation will promote a culture that meets customers’ perceptions of quality Benchmarking is the primary tool used for TQM Total Quality Management (TQM)

Copyright John Wiley & Sons 2007 Chapter 2 Innovation Innovation is the art of making new connections and continually challenging the ‘status quo’ Many successful innovations result from technological breakthroughs, not from market research Ideas must be turned into something that can be produced and marketed Innovation is a national issue, not just a corporate one

Copyright John Wiley & Sons 2007 Chapter 2

Copyright John Wiley & Sons 2007 Chapter 2 Creating the Marketing Plan Marketing planning is the process of assessing opportunities and resources, determining objectives, defining strategies and establishing guidelines for implementation and control of the marketing program The plan is the basis for communication among employees and operational units.

Copyright John Wiley & Sons 2007 Chapter 2 The Marketing Plan — Contents Executive Summary Situation analysis SWOT analysis Marketing objectives Marketing strategies Marketing implementation and control –The proposed plan has to be justified in financial terms

Copyright John Wiley & Sons 2007 Chapter 2 Implementing marketing strategies Marketing implementation is the process of executing marketing strategies Intended strategy is the strategy decided upon during the planning phase, and is normally different from Realised strategy, which is the strategy that actually takes place. Inadequate implementation often results in the difference between the two!

Copyright John Wiley & Sons 2007 Chapter 2 Coca-Cola – tailoring marketing strategies around the globe Dial-UpBroadband

Copyright John Wiley & Sons 2007 Chapter 2 The deliberate or strategic approach When a strategy is developed and implemented assuming that the environment is perfectly calculable and predictable and under the organisation’s full control The emergent approach Develops continuously from a constantly changing marketplace Approaches to marketing strategy

Copyright John Wiley & Sons 2007 Chapter 2