Chapter 15 The marketing process and marketing strategy

Learning objectives 1 Understand the importance of strategic marketing and prepare a basic outline for a marketing plan 2 Develop an appropriate business mission statement 3 Describe the criteria for stating good marketing objectives

Learning objectives (cont.) 4 Explain the components of an internal and external environmental scan 5 Discuss target market strategies 6 Describe the elements of the marketing mix 7 Explain why implementation, evaluation and control of the marketing plan are necessary

Learning objectives (cont.) 8 Discuss the importance of global marketing 9 Describe the external environment facing global marketers 10 List the basic elements involved in developing a global marketing mix 11 Consider how the Internet is affecting global marketing

Organisational overview of strategy Corporate strategy Strategic business unit Functional strategy

Marketing orientations Production orientation Sales orientation Marketing orientation Relationship marketing orientation

Define the term marketing Learning objective 1 Understand the importance of strategic marketing and prepare a basic outline for a marketing plan Define the term marketing

1 Planning The process of anticipating future events and determining strategies to achieve organisational objectives in the future.

1 Strategic planning The managerial process of creating and maintaining a fit between the organisation’s objectives and resources and evolving market opportunities.

Strategic plan 1 Defining the company mission. Setting company objectives and goals. Designing the business portfolio. Planning the marketing and other functional activities.

Marketing strategy issues 1 Marketing strategy issues What is the organisation’s main marketing activity at a particular time? How will it reach its goals? What are the appropriate target markets? What are the most appropriate objectives for each of the target markets? What is the appropriate marketing mix in each market?

Describe four marketing management philosophies. Learning objective 2 Describe four marketing management philosophies. Develop an appropriate business mission statement

Mission statement 2 The firm’s long-term vision based on a careful analysis of benefits sought by present and potential customers and analysis of existing and anticipated environmental conditions.

Describe four marketing management philosophies. Learning objective 3 Describe four marketing management philosophies. Describe the criteria for stating good marketing objectives

Marketing objective 3 A statement of what is to be accomplished through marketing activities.

Learning objective 4 Explain the components of an internal and external environmental scan

4 SWOT Internal Strengths Weaknesses External Opportunities Threats

Learning objective 5 Discuss target market strategies

Marketing mix 5 A unique blend of product, distribution, promotion and pricing strategy designed to produce mutually satisfying exchanges with a target market.

Learning objective 6 Describe the elements of the marketing mix

6 The four Ps Product Price Place Promotion

Learning objective 7 Explain why implementation, evaluation and control of the marketing plan are necessary

Reasons why marketing plans fail 7 Reasons why marketing plans fail Planning done in isolation Trade-off problems between short- and long-term objectives Resistance to change Importance of control Conduct marketing audit

7 Marketing audit A thorough, systematic periodic evaluation of the goals, strategies, structure and performance of the marketing organisation.

Learning objective 8 Discuss the importance of global marketing

Global vision 8 Recognising and reacting to international marketing opportunities, being aware of threats from foreign competitors in all markets, and effectively using international distribution networks.

Learning objective 9 Describe the external environment facing global marketers

The external environment 9 The external environment Culture Economic and technological development Political structure Demographic makeup Natural resources

9 Culture The common set of values shared by its citizens that determine what is socially acceptable.

Culture (cont.) 9 Language Religion Superstitions Etiquette Customs Traditions Notion of time

Lessons about the notion of time 9 Lessons about the notion of time 1 Know appropriate arrival time. 2 Understand the line between work time and social time. 3 Study the rules of the waiting game. 4 Learn to reinterpret ‘doing nothing’. 5 Ask about accepted sequences. 6 Are people on clock time or event time?

Economic and technological development 9 Economic and technological development Type of society Description Traditional Agricultural, little upward mobility Pre-industrial Social and economic change Takeoff New industries Industrialising Spread of technology Fully industrial Exporter, technology as driver of new innovation

Legal structures which encourage or limit trade 9 Legal considerations Legal structures which encourage or limit trade Tariff Quota Boycott Exchange control Market grouping Trade agreement

Legal considerations (cont.) 9 Legal considerations (cont.) Tariff A tax levied on goods entering a country. Quota Limit on the amount of a product that can enter a country. Boycott Exclusion of products from a country. Exchange control Foreign exchange must be sold to a control agency. Market grouping A common trade alliance. Trade agreement An agreement to stimulate international trade.

Trade agreements: Uruguay Round 9 Trade agreements: Uruguay Round Reduces tariffs by one-third world-wide Patent/copyright protection Services under international rules Reduction of farm subsidies

World Trade Organization (WTO) 9 World Trade Organization (WTO) The World Trade Organization replaces the old General Agreement on Tariffs and trade (GATT). All WTO members must fully comply with all the agreements under the Uruguay Round. China has joined the WTO.

Marketing considerations 9 Demographic makeup Marketing considerations Population density Urban or rural Personal income Rise of global middle class Supply of professionals

Natural resources 9 Differences in natural resources create: international dependencies shifts of wealth inflation and recession export opportunities if resources are abundant stimulus for military intervention.

Learning objective 10 List the basic elements involved in developing a global marketing mix

10 Pricing Must consider transportation and insurance costs, taxes and tariffs. Determine what customers will spend. Ensure that foreign buyers will pay them. May need to simplify a product to lower price.

10 Dumping The sale of an exported product at a price lower than that charged for the same or a like product in the exporter’s ‘home’ market.

10 Countertrade A form of trade in which all or part of the payment for goods or services is in the form of other goods or services.

Distribution challenges 10 Distribution challenges Japanese distribution system is the most complicated in the world. Retail institutions may differ from company’s domestic market. Distribution channels and physical infrastructure may be inadequate.

Learning objective 11 Consider how the Internet is affecting global marketing

Going global 11 More than 50% of Australians own computers. Australia is among the leading countries with access to the net for the population. Internet purchases are still a small percentage of overall retail sales. US customers are more likely to buy online. Complexity of tariffs, freight.