1. Chapter 2 Strategic Planning Principles

2. Review from Chapter 1 What is IMC?
Name 2 types of advertising – give examples
Give 3 examples of Direct Response – What is the difference between advertising and direct response?
What is fueling the growth in interactive communications? Explain and give an example
What’s the difference between push and pull sales promotions? Give examples of each
What are the four trends driving IMC?
What is the Hierarchy of Needs? How do we use it? Give examples
What is the difference between the “real self” and the “ideal self”? Give an example of an ad that targets one’s “ideal” self.
Describe how perception affects advertising and promotion

3. Integrated Planning
Integrated planning involves linking plans from various management levels of an organization together.
Corporate
Planning
By Senior Executives
By Brand Managers and Marketing Managers
Marketing
Planning
By Communications Specialists
IMC
Planning

4. Strategic Planning Strategic planning includes three common variables.
Statements about what is to be accomplished.
Objectives
Statements outlining how objectives will be achieved.
Strategies
Example – West Jet
Execution
Action-oriented details.

5. West Jet

6. Influences on Strategic Plans
Corporate Plan
External Influences
Economy
Competition
Social / Demographic
Technology
Laws / Regulations
Marketing Plan
Economic Influences – The state of the economy often dictates how aggressive or conservative a company is with its plans. The state of the economy is determined by such factors as growth rates in GDP, inflation rates, levels of employment, and the value of the dollar in relation to foreign currencies. The relationship among these variables is dynamic. An economy tends to go through cycles (the outcome of these variables): recession, depression, recovery, and prosperity.
Competitor Influences – The type of market a company operates in has an impact on the nature of planning. The various structures include monopolies, oligopolies, and monopolistically competitive markets. Competition is classified as being direct (competition from alternative products) or indirect (competition from substitute products). The lines between direct and indirect competition is less today than previously. For example, Loblaws and Wal-Mart once operated in separate markets. The addition of new product lines by each company now makes them direct competitors. Coca-Cola does not just compete against Pepsi-Cola. It competes against all other cold beverages.
Social and Demographic Influences – Adjusting business strategies to fit with demographic trends is essential. The key trends include the following:
The rate of population growth is slowing down
The population is concentrated in urban areas
Households are getting smaller and the structure of them is changing
The population is becoming more ethnically diverse
Gender equity is altering decision-making processes
Generally speaking, the population is more environmentally conscious than before and this trend is affecting how companies market their products. Social responsibility marketing programs have come to the foreground. A population is targeted based on similar characteristics. Common population groupings included seniors, baby boomers, Generation X, Generation Y, and so on.
Technology Influences – Technology embraces discoveries, inventions and innovations. New technologies present new opportunities for companies. Canadian society has been quick to embrace technology meaning that future marketing plans and marketing communications plans will have a technological focus. For example, the means of communicating with prospective customers will rely more on electronic communications and less on traditional mass media communications.
Legal and Regulatory Influences – Laws and regulations govern business practice. The primary instrument that companies follow is the Competition Act. It cannot be assumed that all companies follow ethical practices. Numerous companies have made headline news for their corporate malaise in recent years. With regard to communications a company must be careful about claims made for products. They cannot misrepresent the product nor mislead the public.
IMC Plan

7. Plans are Linked Together
Plans from above provide guidance for IMC plans.
Corporate
Plan
Strategic orientation
Marketing
Plan
Strategic and tactical orientation
IMC Plan

8. Corporate Plans
A corporate plan is long-term and broad in scope. It includes an organization’s:
Mission Statement
Corporate Objectives
Corporate Strategies

9. Mission Statement
“A statement of an organization’s purpose that reflects the operating philosophy and the direction the company will take.”

10. Coke’s Mission Statement
To refresh the world … in body, mind and spirit
To inspire moments of optimism … through our brands and our actions
To create value and make a difference … everywhere that we engage

11. Corporate Objectives
Objectives are quantitative in nature, growth oriented, and measurable.
Sales
Profit
Return on Investment
Social Responsibility

12. Corporate Strategies Some Alternatives Strategic Penetration Direction
New Product Development
Acquisition
Strategic Alliance
The strategic direction a company takes varies but some common directions include:
Penetration Strategies – A company decides to pursue the competition aggressively (e.g., they spend more or offer a wider package of marketing initiatives).
New Product Development – Real growth often comes from new products (e.g., McDonald’s increased sales by adding salads to its menu).
Acquisitions – A company buys another company or a group of brands from a company in order to enter profitable market segments (e.g., Pepsi-Cola acquired Quaker to get control of Gator Ade).
Strategic Alliances – Two or more companies form an alliance to collaborate their efforts in pursuing a particular market (e.g., hotels, restaurants and airlines may work together to develop the travel market).
$ for Marketing
and Other
Operations

13. Marketing Planning Marketing planning involves four essential steps:
Analyzing market opportunities
Developing marketing strategies
Planning and implementing programs
Measuring and evaluating programs

14. Marketing Planning & Control
Implementation
Modify Strategies
Evaluation & Control
Corrective Action
Revise Objectives

15. Marketing Plan Background and SWOT Marketing Plan Positioning Strategy
Target Market Profile
Marketing Objectives
Marketing Strategy
Marketing Execution
The following are key areas of the background section of the plan:
External Influences – A review of economic trends, social and demographic trends, technology trends and regulatory trends.
Market Analysis – An evaluation of market size and growth, regional market importance, market segment analysis, and seasonal trends.
Target Market Analysis – The identification of the primary and secondary customer groups along with their characteristics, lifestyles, and habits. Other concerns include their degree of brand loyalty and understanding of what factors influence their buying decisions.
Brand Analysis – A review of sales trends, market share trends, distribution trends, marketing communications programs, and any new product activity that has been recently undertaken.
Competitor Analysis – Knowledge of key competitor’s sales volume, market share, and marketing strategies are analyzed for effectiveness.
SWOT Analysis – An attempt is made to interpret the data collected in the above sections. In summary form what are the key issues that will influence the direction of marketing strategy. The goal is to match potential opportunities with the resources available.
The marketing plan section includes the following information:
Positioning Strategy Statement – A statement that reflects what the brand stands for. It is the desired image that the company wants to instill in the customer’s mind.
Target Market Profile – A thorough description of the customer based on demographic, psychographic, and geographic characteristics.
Marketing Objectives – Statements identifying quantifiable goals for a one-year period (e.g., sales, market share, product improvements, new product introductions, etc.).
Marketing Strategies – The role and contribution of each element of the marketing mix are identified and resources are allocated to each element. These strategies provide guidance for the development of marketing communications plans.
Marketing Tactics – The identification of specific marketing actions (the action plan). All details are mapped out according to type of activity, timing, and cost.
Budget and Financial Summary – The financial implication of the plan must be communicated to senior management. Typically, a profit and loss statement for the product is included in the plan. The statement will compare previous year’s financial performance to the current year to date, and the plan year.
Evaluation and Control – Marketing plans are reviewed while in progress to determine if changes are necessary. Marketing control is a process of measuring and evaluating results of actions taken and planning corrective action when necessary. Companies often build in contingency plans that can be quickly implemented should certain
Evaluation &
Control

16. Budget Determination
Several methods are available for determining a budget:
% of Sales
Fixed Sum / Unit
Industry Average
Task (Objective)

17. Marketing Communications Planning
External agents are often responsible for preparing plans.
The contribution of each communications component must be determined. Some provide short-term benefit and some provide long-term benefit.
The components must be integrated to present a unified message to the target.

18. Marketing Communications Objectives
Marketing communications must satisfy a diverse list of objectives, hence the need for integration of various components.
Build / Sustain Awareness
Develop Image
Alter Perceptions
Differentiate Products

21. Marketing Communications Objectives
Attract New Targets
Encourage Greater Use
Offer Incentives
Create Goodwill
Create Leads
Motivate Distributors

22. Marketing Communications Strategies
Advertising
Direct Response
Online Interactive
Sales Promotion
Personal Selling
Public Relations
Event Marketing
Depending on the objectives to be achieved, competitive activity, and budget, the best combination of marketing communications components are recommended. Each situation is unique.