Chapter 2 STRATEGIC PLANNING and the Marketing Process 2-1

STRATEGIC PLANNING: types of plans Annual plan Long-range plan Strategic plan 2-2

STRATEGIC PLANNING: annual plan Marketing objectives Implementation details Detailed budget 2-3

STRATEGIC PLANNING: long range plan Long-term objectives Major strategies Resources required 2-4

STRATEGIC PLANNING STRATEGIC PLANNING: process Identify opportunities in environment Match opportunities with capabilities Build goals around opportunities 2-5

STRATEGIC PLANNING: steps in strategic planning Defining the company mission Defining the company mission Setting company objectives and goals Setting company objectives and goals Designing the business portfolio Designing the business portfolio Planning, marketing, and other functional strategies Planning, marketing, and other functional strategies 2-6

STRATEGIC PLANNING: defining the mission MISSION STATEMENT Purpose Guides people’s efforts Understand values Ethical behaviour 2-7

STRATEGIC PLANNING: mission statement criteria Market-oriented Realistic Specific Appropriate for the environment Based on competencies Motivating 2-8

STRATEGIC PLANNING: setting goals and objectives Business objectives Marketing objectives for each level specific and verifiable Supporting marketing strategies 2-9

Designing the Business Portfolio Analyzing the current portfolio Plan functional strategies 2-10 Develop growth strategies

Designing the Business Portfolio: analyzing the current portfolio Identify key businesses Assess attractiveness of each business Determine appropriate support level 2-11

The BCG Growth-Share Matrix Low ? ? ? Low High Market growth rate Relative market share Star Cash cow Question mark Dog 2-12

The GE Planning Grid Business strength AverageStrongWeak High Medium Low Industry attractiveness 2-13 A B

Designing the Business Portfolio: problems with matrix approaches Difficult and time consuming Costly Focus on current business over future Overemphasis on market share and growth About 75% of Fortune 500 still find useful 2-14

Designing the Business Portfolio: developing growth strategies 4. Diversification 2. Market development 2. Market development 3. Product development 3. Product development Existing products New products Existing markets New markets Market penetration

Designing the Business Portfolio: planning functional strategies Marketing’s Role guiding philosophy the marketing concept identify opportunities evaluate potential develop unit marketing strategies 2-16

Target Consumers Product PlacePrice Promotion Marketing Implementation Marketing Planning Marketing Control Marketing Analysis Competitors Marketing Channels PublicsSuppliers Technological- natural environment Political- legal environment Social- cultural environment Demographic- economic environment 2-19

Target Consumers Market Targeting Market Positioning Market Segmentation 2-20

Target Consumers: market segmentation Group of consumers With a similar response To a given set of marketing stimuli 2-21

Target Consumers: market targeting Evaluating each segment’s attractiveness Selecting one or more segments to enter Single or multiple segment strategy 2-22

Target Consumers: market positioning Product occupies: position in consumer’s mind clear distinct desirable relative to competition 2-23

The Marketing Mix Product Target consumers Target consumers Promotion Price Place 2-24

Marketing Strategies For Competitive Advantage Market-leaders Market-followers Market nichers 2-25

Managing the Marketing Effort PLANNING Strategic Plans Marketing Plans PLANNING Strategic Plans Marketing Plans IMPLEMENTATION Carry Out Plans IMPLEMENTATION Carry Out Plans Analysis CONTROL Measure Results Evaluate Results Corrective Action 2-26

Marketing Planning: marketing plan contents Executive summary Current target market and marketing mix Analysis of opportunities and threats Objectives and issues Marketing strategy Action programs Budgets and controls 2-27

Marketing Implementation People Organization structure Decision & Reward systems Fit with company culture 2-28

Marketing Organization By marketing function performed By geographic areas covered By product or brand responsibility By markets served Multiple approaches for large companies 2-29

Marketing Control Set Goals Measure Performance Measure Performance Evaluate Performance Evaluate Performance Take Corrective Action Take Corrective Action 2-30