Corporate Marketing Planning

uCorporate Strategy äWhich products to Offer äWhich Markets to Serve uProduct Mix Strategy äWhat Each Product Should Contribute to the Firm äHow Resources Should be Allocated Across Products

Factors Influencing Corporate Strategy Environmental Problems and Opportunities Corporate Mission and Objectives Corporate Strategy Organizational Resources and Competencies

Using Distinctive Competencies uCompetency ÊR&D Capability ËFinancial Resources ¸Company Reputation for Quality ¹Strong Sales Force ºControl Over Materials and Other Supplies uPotential Use ¶Emphasize High technology in product development ·Acquiring other businesses ¸Select markets where reputation is known ¹Select new products that can be sold by same salesforce ºEmphasize products that require these resources; compete as low-cost producer

Common Types of Corporate Objectives uProfitability äi.e. Net profit as a percent of sales uVolume äi.e. Market share uStability äi.e. Variance in annual sales volume uNonfinancial äi.e. Improved corporate image

Sell the Business Core Business Integration Product Development Backward Forward Horizontal Market Development Market Penetration Concentric Horizontal Conglomerate New Products for Existing Markets New Markets for Existing Products New Product Markets (Diversification) Related to Core Business Unrelated to Core Business Core Development Options

Basic Types of Corporate Strategy uGrowth Strategies äFor Current Markets (Market penetration (Product Development (Vertical Integration äFor New Markets (Market development (Diversification (Strategic Alliances

Basic Types of Corporate Strategy uConsolidation Strategies äRetrenchment äPruning äDivestment

Product Mix Strategy uProduct Form uProduct Class uGeneric Need uSales of regular tea, decaffeinated tea or herbal tea uSales of tea uSales of all beverages Definitions of the Relevant Market

Product Mix Strategy uThe BCG Growth-Share Matrix uThe GE Business Screen uDirectional Policy Matrix Product Portfolio Models

The BCG Matrix ? ? Low High GROWTHRATEGROWTHRATE MARKET SHARE High Low

R & D Cash Generated Cash Use Net Star Cash Generated Cash Use Net Cash Cow Cash Generated Cash Use Net Problem Child Cash Generated Cash Use Net Dog Cash Generated Cash Use Net High Low 0% 10% 10x 1.0x1x Market Dominance Market- Growth Rate The BCG Growth-Share Matrix

GE Planning Grid Protect Position Invest to Build Build Selectively Selectivity/ Manage for Earnings Selectivity/ Manage for Earnings Limited Expansion or Harvest Limited Expansion or Harvest Protect and Refocus Protect and Refocus Manage for Earnings Manage for Earnings Divest Low High Medium Strong Weak Business Strength Strategies Market Attractiveness

Evaluating Competitive Strength and Market Attractiveness uCompetitive Strength Dimensions äDoes our market share suggest we have a strong customer base? äDo we have the managerial skills needed to compete? äAre our production facilities modern and efficient? äDo we possess the technology to maintain a competitive rate of innovation? äDo customers have a positive image of our products? äDoes our cost structure enable us to be competitive on price? äDo we have stable and reliable suppliers?

Evaluating Competitive Strength and Market Attractiveness uMarket Attractiveness Dimensions äIs the industry sales-growth rate high? äIs the market large enough to sustain several competitors? äIs the rate of product obsolescence high? äDoes extensive government regulation constrain actions? äIs there a risk of raw material or component shortage? äAre their a large number of strong competitors? äDoes the industry present a strong potential for profit? äDoes the industry fit well with our overall corporate strategy?