1. Marketing : An Introduction
Armstrong, Kotler
& da Silva
Marketing : An Introduction
An Asian Perspective 2
Company and Marketing Strategy: Partnering to Build Customer Relationships

2. Important Concepts
Explain companywide strategic planning and its four steps.
Explain marketing’s role in strategic planning and how marketing works with its partners to create and deliver customer value.
Describe the elements of a customer-driven marketing strategy and mix, and the forces that influence it.

3. Opening Case Study- Walt Disney Company

4. Disney Land
Known for films, animation, theme parks and customer orientation
Parks offer a variety of attractions as well as cleanliness, order, and warmth
Satisfying the customer is everyone’s job
Disney has grown via diversification
Disney’s strong presence will be enhanced in Asia with the opening of Hong Kong

5. Strategic Planning
Strategic Planning is the Process of Developing and Maintaining a Strategic Fit Between the Organization’s Goals and Capabilities and Its Changing Marketing Opportunities.

6. Steps in Strategic Planning
Figure 2.1

7. Outcomes of effective marketing strategies:
Achieve clear competitive advantages over the firm’s rivals
Create positive responses among its target customers
Turn in positive contributions to its bottom-line

8. Strategies Over Time-Singapore Airlines
Figure 2.3

9. Questions a Mission Statement Should Answer
What is our Business?
Who is the Customer?
What do Consumers Value?
What Should our Business Be?

10. The Mission Statement A statement of the organization’s purpose
What it wants to accomplish in the larger environment
Should be market oriented and defined in terms of customer needs.

11. Mission Statements Should:
Be Realistic
Be Specific
Fit the Market Environment
Be Based on Distinctive Competencies
Be Motivating
2-11

12. Mission Statements : Examples
Amazon.com: We sell books, videos, CDs, Consumer electronics, hardware and other products.
Canon: We make copying machines, fax machines and scanners

13. Designing the Business Portfolio
The business portfolio is the collection of businesses and products that make up the company.
The company must:
analyze its current business portfolio or Strategic Business Units (SBUs),
decide which SBUs should receive more, less, or no investment,
develop growth strategies for growth or downsizing.

14. Strategic Business Unit (SBU)
A unit of the company that has a separate mission and objectives and that can be planned independently from other company businesses.
Can be a company division, a product line within a division, or sometimes a single product or brand.

16. Portfolio Analysis
An evaluation of the products and business making up the company.
Resources are directed to more profitable businesses and weaker ones are phased down or dropped.

17. Step I. Analyzing the Current Business Portfolio:
Management’s first step is to identify the key businesses making up the company. These can be called Strategic Business Units (SBUs).
The next step in the business portfolio analysis calls for management to assess the attractiveness of various SBUs and decide how much support each deserves.
The best known portfolio planning method was developed by the Boston Consulting Group (BCG), a leading management consulting firm.

18. Analyzing Current SBU’s: BCG Growth-Share Matrix
Relative Market Share
High Low
Question Marks
Low share SBUs in high growth
markets
Require cash to hold
market share
Build into Stars or phase out ?
Stars
High growth & share
May need heavy
investment to grow
Eventually, growth will slow
Market Growth Rate
Low High
Cash Cows
Low growth, high share
Established, successful
SBU’s
Produce cash
Dogs
Low growth & share
Generate cash to sustain self
Do not promise to be cash
sources

19. Strategies in Managing the SBUs in the Portfolio
Figure 2.6

20. The BCG Growth-Share Matrix
Figure 2.4

21. Comparison of Business Portfolios
Figure 2.5

22. Problems With Matrix Approaches
Can be Difficult, Time Consuming, Costly to Implement
Difficult to Define SBUs & Measure Market Share/Growth
Focus on Current Businesses, Not Future Planning
Problems With Matrix Approaches
Can Place too Much Emphasis on Growth

23. Step II. Developing strategies for growth and Downsizing
Marketing has the main responsibility for achieving profitable growth for the company.
Marketing must identify, evaluate, and select market opportunities and lay down strategies for collecting them.
One useful device for identifying growth opportunities is the Product/Market Expansion Grid.

24. Product/Market Expansion Grid
Figure 2.7
P R O D U C T
Existing
New
Market Penetration
Product Development
Existing
M A R K E T
Market Development
New
Diversification
2-32

25. Product/Market Expansion Grid Based on Starbucks
Market Penetration: make more sales to current customers without changing products.
How? Add new stores in current market areas; improve advertising, prices, menu, service.
Market Development: identify and develop new markets for current products.
How? Review new demographic (seniors/ethnic consumers) or geographic (Asian, European, Australian, & South American) markets.

26. Market Penetration Started the first shop in 2004
In 2009, the number of shops reached 41 including 8 University campuses
Surej P John
1/ 2011

27. Market Development
The matrix shows that market development is defined as taking existing products into new markets. Wal-Mart’s expansion into Guatemala and other Central American countries is an example of this strategy.
Diversification is developing new products for new markets. South Korea’s LG Electronics has created new products for the American home appliance market. Innovations such as a $3,000 refrigerator with a built-in flat panel LVD TV have been instrumental in Home Depot’s decision to carry the appliance product line.

28. Product/Market Expansion Grid Based on Starbucks
Product Development: offering modified or new products to current markets.
How? Add food offerings, sell coffee in supermarkets, co-brand products.
Diversification: start up or buy businesses outside current products and markets.
How? Making and selling CDs, testing restaurant concepts, or branding casual clothing.

29. Product Development
Surej P John
1/ 2011

30. Diversification
Diversification is developing new products for new markets
Surej P John
1/ 2010

31. Downsizing:
Reducing the business portfolio by eliminating the products or business units that are not profitable or that no longer fit the company’s overall strategy.
Surej P John
1/ 2011

32. Managing Marketing Strategy and Marketing Mix
Figure 2.13

33. Market Segmentation
The process of dividing a market into distinct groups of buyers with different needs, characteristics, or behavior who might require separate products of marketing programs.
A market segment consists of consumers who respond in a similar way to a given set of marketing efforts.

34. Market segmentation

35. What is the target market?

36. Target Marketing
Involves evaluating each market segment’s attractiveness and selecting one or more segments to enter.
Target segments that can sustain profitability.

37. Market Positioning
Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers (e.g. “in a perfect world everyone would drive a Mercedes Benz”)
Process begins with differentiating the company’s marketing offer so it gives consumers more value.

38. The Marketing Mix
The set of controllable, tactical marketing tools that the firm blends to produce the response it wants in the target market.
Consists of the 4 P’s
Product
Price
Place
Promotion

39. The 4 P’s of the Marketing Mix
Figure 2.14

40. Achieving Competitive Advantage, Integration and Positioning in the Marketing Mix
Figure 2.15 (a)

41. Product strategies
Any kind of strategies that are related to make product improvements.
Product quality
Product design
Product features
Brand Name
Packaging
Services

42. Price Strategies
Any kind of business decisions that directly related to the price of the product or service offered
List price
Discounts
Allowances
Credit terms etc.

43. Place Strategies
Place includes the company activities that make the product available to target customers.
Place includes Channels, Coverage, Locations, Inventory, transportation, logistics etc.

44. Promotion Strategies
Promotion means activities that communicate the merits of the products and persuade the target customers to buy it.
Advertising, Sales promotion, personal selling, public relations etc. are coming under the Promotion concept.

45. SWOT ANALYSIS
An overall evaluation if the company’s strength (S), weakness (W), Opportunities (O), and Threats (T) is called SWOT analysis.

46. Strengths Good brand name Low cost of production Cheap Labor
Internal abilities that help the company to achieve its objectives
Good brand name
Low cost of production
Cheap Labor
Enough budget for advertisement or promotions
Ability to introduce the new product into market

47. Weakness High Competition Lack of enough money Poor Quality
Internal limitations that may interfere or block the company’s ability to achieve its objectives
High Competition
Lack of enough money
Poor Quality
Cheap Brand name

48. Opportunities'
External factors of the market that the company may be able to take advantage.
Large potential market
Lack of competitors
Moving into new market segment that offer more profits

49. Threat External factors that may challenge the company’s performance
A new competitor in your home market.
Price wars with competitors.
A competitor has a new, innovative product or service.
Competitors have superior access to channels of distribution.