1 PowerPoint Presentations for Effective Marketing Adapted for the First Canadian Edition by Jennifer Monk Algonquin College Copyright © 2008 by Nelson Education Ltd.

2 CHAPTER TWO MARKETING MANAGEMENT: STRATEGY

3 Learning Objectives 1.Discuss the roles of marketing planning and execution at the corporate level, at the strategic business unit level, and at the operational level of management. 2.Understand the concept of the organizational mission. 3.Understand the nature of competitive advantage. 4.Explain the market/product mix. 5.Identify the stages of the strategic marketing process. 6.Understand the nature of marketing ethics and social responsible behaviour.

4 Marketing Management  The process of: 1. planning, 2. executing, and 3. controlling marketing activities to attain the marketing goals and objectives effectively and efficiently.  Change is constant and therefore the process is a continuous process.

5 What is a marketing strategy?  A plan identifying what marketing goals and objectives will be pursued and how they will be achieved in the time available.

6 Planning: A Framework for the Future Establishing goals and objectives Envisioning the Future Designing strategies to be implemented in the future

7 Level of management planning

8 Planning: A Framework for the Future Management Level Planning Focus Marketing Questions (visit page 31) Top Management Corporate plans What is the mission? Business structure? Middle Management Strategic Business Unit Competitive strategy for growth? Competitive advantage? Operational Management Operation al plans How to support the competitive strategy? Weekly operational schedules

9 Top Management: Mission Statement A mission statement is:  A broad statement of the company’s purpose  Explains the purpose of the organization  Provides direction for the entire company Walt Disney’s Mission “The Walt Disney Company is committed to balance environmental stewardship with our corporate goals throughout the world”

10 Top Management: Mission statement Three Guiding Principles: 1.Success depends on customer satisfaction 2.Consumer oriented perspective 3.Avoid short-sighted, narrow-minded thinking Consumer wants?

11 Strategic business units (SBu)  Operates as a “company within a company”  A SBU is organized around some common element such as…. SBU Industry Technology Target Market Customer need

12 Boston consulting groups growth-share matrix  Commonly referred to as the BCG Matrix  Develop to evaluate SBU’s performance based industry growth (vertical axis) versus relative market share (horizontal axis)  Assists management to determine resource allocation  Four categories: Stars, Cash cows, Dogs, Question Marks (see exhibit 2-3, page 34)

13 Boston consulting groups growth-share matrix STARQUESTION MARK CASH COW DOG MARKET SHARE (Cash Generation) LOWHIGH LOW GROWTH RATE (Cash Use)

14 Boston consulting groups growth-share matrix Stars:  High market share  Rapid growth  Require significant cash investment  Market leaders & generate lots of cash  Over time growth will slow down  Two options: become a cash cow or a dog

15 Boston consulting groups growth-share matrix Cash Cows:  Market share is high and cash generation is high  Slow growth and low cash use  Consistent cash flow to pay for overhead  Possible Objective:  strong cash cow - Hold share,  weakening cash cow – Harvest

16 Boston consulting groups growth-share matrix Dogs:  Low market share  Low growth  Money pit  Possible Objectives:  harvest or divest

17 Boston consulting groups growth-share matrix Question Marks:  Low in market share  High in growth rate  High use of cash  Success is a gamble  Possible Objectives:  Shows promise? Build Share  Dicey? Harvest or Divest

18 Marketing Strategies at the SBU LEVEL  Marketing managers focus on two key aspects of SBU strategies: 1.Establish a competitive advantage  Superior to or favourably different from competitors  Examples include: price leadership, differentiation strategy 2.Plan growth strategies  (Visit Exhibit 2-5, page 37)

19 The Market/Product Matrix (Exhibit 2-5) Market Penetration Market Development Product Development Diversification NewExisting New Markets Products Planning business-unit growth strategies

20 The six stages of the Strategic marketing Process Planning stages 1.Identifying and evaluating opportunities 2.Analyzing market segments and selecting target markets 3.Planning a market position and developing a marketing mix strategy 4.Preparing a formal marketing plan 6. Controlling efforts and evaluating the results 5. Executing the plan

21 Stage One: Identifying and Evaluating Opportunities Situation Analysis: two major components: 1.Environmental scanning & monitoring  External forces and trends are identified as opportunities and threats  Forces include: sociocultural, demographic, economic, etc. 2. Internal analysis  Internal strengths and weakness are identified  Key topics include: customers, suppliers

22 Stage One: Identifying and Evaluating Opportunities Bringing the internal and external analysis together: Strengths (build on) Weaknesses (deal with) Opportunities (take advantage) Threats (avoid) Internal Micro-environment External Macro-environment S.W.O.T

23 Stage Two: Analyzing Market Segments & Selecting Target Markets  Consumer Market (B2C) vs. Organizational Markets (B2B) (Visit exhibit 2-8, page 42)  Market segment  Portion of a larger market (i.e. French Canadians)  Market segmentation  Dividing the mass market into smaller groups with similar characteristics that are likely to become the target market  Target market  The specific group(s) the organization directs its marketing mix towards

24 Stage Three: Market Positioning and Marketing Mix strategy  Market position:  How consumers perceive a brand relative to its competition  Developing marketing mix (4P’s):  Product  Price  Place (distribution)  Promotion Recall from Chapter 1?

25 The yearly marketing plan is a written report that includes:  Marketing objectives (S.M.A.R.T)  Marketing strategies  Marketing mix  Responsibility allocation  Implementation timeline Stage 4: preparing a Formal Marketing Plan

26 Putting the plan into action! Management best practices:  Ensure resources are properly allocated  Clearly understand and communicate goals and expectations  Create reasonable expectations and deadlines Stage 5: Executing the marketing plan

27 Marketing Audits: Ensure that planned activities are executed properly  Benchmark: establish performance standards  Supervision: investigate to ensure tasks have been completed “checking up”  Adjustments: evaluate to determine if goals have been achieved  Yes? Continue with the plan  No? Make adjustments and monitor Stage 6: controlling efforts and evaluation results

28 Managerial Ethics & Socially Responsible Behavior Marketing Ethics (Exhibit 2-10, page 49) Moral Behaviour Norms

29 Successful managers will take action by: 1.Recognizing and clarifying the dilemma 2.Getting all possible facts 3.Listing the options – all of them 4.Testing each option by asking:  “Is it legal? Is it right? Is it beneficial?” 5.Making a decision 6.Double checking the decision  “How would if feel if family and friends found out?”  “Would I feel the same if the decision was printed in the paper?” 7.Take the action if warranted Resolving ethical dilemmas

30 IT’S OVER TO YOU… You’re now in spot light! Please explain the following learning objectives using your own words. 1.Discuss the roles of marketing planning and execution at the corporate level, at the strategic business unit level, and at the operational level of management. 2.A good organization mission will (complete the sentence) 3.Describe competitive advantage and market position 4.Explain the market/product mix and the four embedded marketing strategies 5.Identify and explain the stages of the strategic marketing process. 6.Describe are the seven guidelines for overcoming ethical dilemmas.