2 Companywide Strategic Planning The process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities.
3 Steps in Strategic Planning Defining the company missionSetting company objectives and goalsDesigning the business portfolioPlanning marketing and other functional strategiesBusiness unit, product, and market levelCorporate level
4 1.Defining a Market-Oriented Mission Mission StatementA statement of the organization’s purpose—what it wants to accomplish in the larger environment.It should be market oriented and defined in terms of satisfying basic customer needs.
5 Its mission is not simply to sell ice cream. Its mission is to “make people happy around the world by selling the highest quality, most creative ice cream experience with passion, excellence, and innovation.”
6 Its mission is not simply to hold online auctions and trading. It aims “to provide a global trading platform where practically anyone can trade practically anything”—with eBay, “shop victoriously!”It wants to be a unique Web community in which people can safely shop around, have fun, and get to know each other, for example, by chatting at eBay café.
7 Mission Statement Should be meaningful and specific yet motivating Should emphasize the company’s strengths in the marketplaceShould not be stated as making more sales or profits
8 Market-Oriented Business Definition CompanyProduct-Oriented DefinitionMarket-Oriented DefinitionAmazon.comWe sell books, videos, CDs, toys, consumer electronics, hardware, housewares, and other product online.We make the internet buying experience fast, easy, and enjoyable—we’re the place where you can find and discover anything you want to buy online .L’OrealWe make cosmetics.We sell lifestyle and self-expression; success and status, memories, hopes, and dreams.AdidasWe sell athletic shoes and apparel.We strive to be the global leader in the sporting goods industry with sports brands built on a passion for sports and sporting lifestyle.TescoWe run discount stores.We deliver low prices everyday and give ordinary folks the chance to buy the same things as rich people.
9 2. Setting Company Objectives and Goals Turn company’s mission into detailed supporting objectives for each level of management.
10 3. Designing the Business Portfolio The collection of businesses and products that make up the companyThe best business portfolio is the one that best fits the company’s strengths and weaknesses to opportunities in the environment.
11 2 Steps in Business Portfolio Planning 1. Analyzing the current business portfolioPortfolio analysisThe process by which management evaluates the products and businesses that make up the companyGrowth-share matrixA portfolio-planning method that evaluates a company’s strategic business units in terms of its market growth rate and relative market share. SBUs are classified as stars, cash cows, question marks, or dogs.
13 2 Steps in Business Portfolio Planning 2. Developing strategies for growth and downsizingExisting productsNew productsMarket penetrationProduct developmentMarket developmentDiversificationExisting marketNew market
14 4 Strategic Alternatives Market penetration: a marketing strategy that tries to increase market share among existing customersMarket development: a marketing strategy that entails attracting new customers to existing productsProduct development: a marketing strategy that entails the creation of new products for current customersDiversification: a strategy of increasing sales by introducing new products into new markets
15 Ansoff’s Strategic Opportunity Matrix Present ProductNew ProductPresent MarketMarket penetration:McDonald’s sells more Happy Meals with Disney movie promotionsProduct development:McDonald’s introduces premium salads and McWaterNew MarketMarket development:McDonald’s opens restaurants in ChinaDiversification:McDonald’s introduces line of children’s clothing
16 Planning Marketing: Partnering to Build Customer Relationships Value chainThe series of departments that carry out value-creating activities to design, produce, market, deliver, and support a firm’s products.
17 Marketers help deliver value to customers: Learn what customers needStock the stores’ shelves with the desired products at the unbeatable low pricesPrepare advertising and merchandising programsassist shopper with customer service
18 Marketers need help from other departments to effectively deliver value to customers: Purchasing: skill in developing the needed suppliers and buying from them at low costIT: provide fast and accurate info. About products are selling in each storeOperations: provide effective low-cost merchandising handling
19 Partnering with Others in the Marketing System Value delivery networkThe network made up of the company, suppliers, distributors, and ultimately, customer who partner with each other to improve the performance of the entire system
20 Knows the importance of building close relationships with its suppliers Puts “achieve supplier satisfaction” as a part of its mission statement
21 What Toyota Do with Suppliers: Learns about their businessesConducts joint improvement activitiesHelps train supplier employeesGives daily performance feedbackActively seeks out supplier concernsRecognizes top performers with annual performance award
22 Those approaches to suppliers help Toyota: Increase the degree of trust, open, honest communication between themImprove its own qualityReduce costs of productionDevelop new product quickly
23 Marketing Strategy and the Marketing Mix The marketing logic by which the business unit hopes to create customer value and achieve profitable customer relationshipsIt involves 2 key questions:Which customers will we serve (segmentation and targeting)?How will we create value for them (differentiation and positioning)?
24 Managing Marketing Strategies and the Marketing Mix Then the company designs a marketing program-the 4Ps-that delivers the intended value to target consumersAt its core, marketing is all about creating customer value and profitable customer relationships
25 Describing the Target Market Marketing strategy: the activities of selecting and describing one or more target markets and developing and maintaining a marketing mix that will produce mutually satisfying exchanges with target marketsA market segment: a group of individuals or organizations that share one or more characteristicsTarget market should address demographics, psychographics, and buyer behavior
26 Market SegmentationMarket: people or organizations with needs or wants and the ability and willingness to buyMarket Segment: a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needsMarket Segmentation: the process of dividing a market into meaningful, relatively similar, and identifiable segments or groupsPurpose: to enable the marketer to tailor marketing mixes to meet the needs of one or more specific segments
27 Importance of Market Segmentation More precise definition of consumer needs and wantsMore accurate marketing objectivesImprove resource allocationBetter marketing result
28 TargetingTarget Market: a group of people or organizations for which an organization designs, implements, and maintains a marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchangesTargeting narrowlyTargeting broadlyUndifferentiated (mass) marketingDifferentiated (segmented) marketingConcentrated (niche) marketingMicro (local or individual) marketing
29 PositioningPositioning: developing a specific marketing mix to influence potential customers’ overall perception of a brand, product line, or organization in generalPosition: the place of product, brand, or group of products occupies in consumers’ minds relative to competing offeringsProduct differentiation: a positioning strategy that some firms use to distinguish their product from those of competitors
30 Positioning of Procter & Gamble Detergents BrandPositioningTideTough, powerful cleaningCheerTough cleaning and color protectionBoldDetergent plus fabric softenerGainSunshine scent and odor-removing formulaEraStain treatment and stain removalDashValue brandOxideBleach-boosted formula, whiteningSoloDetergent and fabric softener in liquid formDreftOutstanding cleaning for baby clothes, safe for tender skinIvory SnowFabric and skin safety on baby clothes and fine washablesArielTough cleaner, aimed at Hispanic market
31 Positioning Bases Attribute: feature or benefit of product Kleenex® Anti-Viral* TissueKleenex® Anti-Viral* tissues' specially treated middle layer kills cold and flu viruses.Price & quality: price as the indication of valueUse or application:Kahlua liqueurused advertisingto point out 228 ways to consume the product
32 Positioning Bases Product user: personality of type of user Imac positions itself as the bestPC for artworksProduct class: product is positioned against others that provide the same class of benefits.
33 Positioning BasesCompetitor: Avis rental car positioning as “no.2” compared to Hertz and 7up with “the uncola”Emotion: focus on how productmakes customers feel“Just Do It” campaign didn’t tellconsumers what “it” was, but mostgot emotional message of achievement & courage
34 Marketing MixA unique blend of product, place, promotion, and pricing strategies (often referred to as the four Ps) designed to produce mutually satisfying exchanges with a target market4Ps4CsProductCustomer SolutionPriceCustomer CostPlaceConveniencePromotionCommunication
35 Marketing MixProduct strategies: the product includes not only the physical unit but also its package, warranty, after-sale service, brand name, company image, value, and etc.Product can be…Tangible goods: computersIdeas: consultant offeredServices: medical careProducts should also offer customer value
36 Marketing MixPlace strategies: are concerned with making product available when and where customers want them.It is a physical distribution which involves all the business activities concerned with storing and transporting raw materials or finished productsThe goal is to make sure products arrive in usable condition at designated places when needed
37 Marketing MixPromotion strategies: includes advertising, public relations, sales promotion, and personal sellingPromotion’s role in the marketing mix is to bring about mutually satisfying exchanges with target markets by informing, educating, persuading, and reminding them of the benefits of an organization or a productGood promotion strategy can dramatically increase sales, however, not all good strategies guarantee success
38 Marketing MixPricing strategies: price is what a buyer must give up to obtain a productIt is often the most flexible of the 4 marketing mix elements—the quickest element to changePrice is an important competitive weapon and is very important to the organization because price multiplied by the number of units sold equals to total revenue for the firm