Presentation on theme: "Kotler on Marketing It is more important to do what is strategically right than what is immediately profitable."— Presentation transcript:
1 Chapter 4 Winning Markets Through Market-Oriented Strategic Planning by
2 Kotler on MarketingIt is more important to do what is strategically right than what is immediately profitable.
3 Chapter ObjectivesIn this chapter, we examine the following questions:How is strategic planning carried out at the corporate and division levels?How is planning carried out at the business unit level?What are the major steps in the marketing process?How is planning carried out at the product level?What does a marketing plan include?
4 Strategic Planning: Three Key Areas and Four Organization Levels Strategic marketing planTactical marketing planMarketing plan
5 Corporate and Division Strategic Planning All corporate headquarters undertake four planning activitiesDefining the Corporate MissionEstablishing Strategic Business Units (SBUs)Assigning resources to each SBUPlanning new businesses, downsizing, or terminating older businesses
6 Corporate and Division Strategic Planning Defining the Corporate MissionMission statements define which competitive scopes the company will operate inIndustry scopeProducts and applications scopeCompetence scopeMarket-segment scopeVertical scopeGeographical scope
7 Discussion QuestionCan you name a company that has recently changed its product scope or market segment scope in a very public way? Was this an expansion or contraction of scope?
8 Corporate and Division Strategic Planning Establishing Strategic Business Units (SBUs)
9 Table 4.1: Product-Oriented versus Market-Oriented Definitions of a Business CompanyProduct DefinitionMarket DefinitionMissouri-Pacific RailroadWe run a railroadWe are a people-and-goods moverXeroxWe make copying equipmentWe help improve office productivityStandard OilWe sell gasolineWe supply energyColumbia PicturesWe make moviesWe market entertainmentEncyclopaediaWe sell encyclopediasWe distribute InformationCarrierWe make air conditioners and furnacesWe provide climate control in the home
10 Corporate and Division Strategic Planning Three characteristics of SBUsSingle business or collection of related businesses that can be planned for separatelyHas its own set of competitorsHas a manager who is responsible for strategic planning and profit
12 Discussion QuestionCan you give an example of a “Star” that skipped “Cash Cow”, and went straight to “Dog” status?
13 Corporate and Division Strategic Planning The General Electric Model
14 See text for complete table Table 4-2: Factors underlying Market Attractiveness and Competitive Position in GE Multifactor Portfolio Model: Hydraulic-Pumps MarketMarket AttractivenessOverall market sizeAnnual market growth rateHistorical profit marginCompetitive intensityTechnological requirementsInflationary vulnerabilityEnergy requirementsEnvironmental impactSocial-political-legalWeight0.200.150.05Must be acceptable1.0Rating =(1-5)4523Value0.801.0.600.300.103.70Business StrengthMarket shareShare growthProduct qualityBrand reputationDistribution network0.400.50See text for complete table
15 Corporate and Division Strategic Planning Critique of Portfolio ModelsPlanning New Businesses, Downsizing Older Businesses
16 Corporate and Division Strategic Planning Intensive Growth
17 Starbucks’ home page: Customers can request a catalog of Starbucks products, subscribe to a newsletter, and shop online
19 Discussion QuestionGive an example of a market segment where integrative growth would be preferable to growth through diversification. Explain why one approach is better than the other.
20 Business Unit Strategic Planning Business MissionSWOT AnalysisExternal Environment Analysis (Opportunity and Threat Analysis)Marketing OpportunityBuying opportunity more convenient or efficientMeet the need for more information and adviceCustomize an offering that was previously only available in standard form
21 Discussion QuestionGive some examples of companies that have grown to dominate their market segment by using technology to make buying opportunities more convenient and efficient.
22 Business Unit Strategic Planning Marketing Opportunity Analysis (MOA)Can the benefits be articulated to a target market?Can the target market be reached with cost-effective media and trade channels?Does the company have the critical capabilities to deliver the customer benefits?Can the company deliver these benefits better than any actual or potential competitors?Will the rate of return meet the required threshold of investment?
24 Business Unit Strategic Planning Internal Environmental Analysis (Strength/Weakness Analysis)Goal FormationStrategic FormulationStrategy
25 Business Unit Strategic Planning Porter’s Generic StrategiesOverall cost leadershipDifferentiationFocus
26 Travelocity’s Web site helps the consumer plan the whole vacation – flights, lodging, and car rental.com
27 Business Unit Strategic Planning Operational Effectiveness and StrategyStrategic groupStrategic alliances
28 Business Unit Strategic Planning Marketing AlliancesProduct or service alliancesPromotional alliancesLogistical alliancesPricing collaborationsPartner Relationship Management, PRMProgram Formulation and Implementation
29 Business Unit Strategic Planning Feedback and Control
30 The Marketing Process Steps in the Planning Process Analyzing Market OpportunitiesDeveloping Marketing StrategiesPlanning Marketing ProgramsManaging the Marketing EffortAnnual-plan controlProfitability controlStrategic control
31 Figure 4-10: Factors Influencing Company Marketing Strategy
32 Product Planning: The Nature and Contents of a Marketing Plan Contents of the Marketing PlanExecutive SummaryCurrent Marketing SituationOpportunity and issue analysisObjectivesMarketing strategyAction programsFinancial projectionsImplementation controls
33 Product Planning: The Nature and Contents of a Marketing Plan Sample Marketing Plan: Sonic Personal Digital AssistantCurrent Marketing SituationOpportunity and Issue AnalysisObjectivesAction ProgramsFinancial Projections
34 Product Planning: The Nature and Contents of a Marketing Plan Implementation ControlsMarketing StrategyPositioningProduct ManagementPricingDistributionMarketing CommunicationsMarketing Research