CHAPTER TWO MARKETING MANAGEMENT: STRATEGY 1

Marketing Management The process of: 1. planning, 2. executing, and 3. controlling marketing activities to attain the marketing goals and objectives effectively and efficiently. Change is constant and therefore the process is a continuous process. 2

What is a marketing strategy? A plan identifying what marketing goals and objectives will be pursued and how they will be achieved in the time available. 3

Planning: A Framework for the Future 4 Establishing goals and objectives Envisioning the Future Designing strategies to be implemented in the future

Top Management: Mission Statement A mission statement is: A broad statement of the company’s purpose Explains the purpose of the organization Provides direction for the entire company 5 Walt Disney’s Mission “The Walt Disney Company is committed to balance environmental stewardship with our corporate goals throughout the world”

Top Management: Mission statement Three Guiding Principles: 1.Success depends on customer satisfaction 2.Consumer oriented perspective 3.Avoid short-sighted, narrow-minded thinking 6 Consumer wants?

What’s Happening? ativecriminals.com/ambient/creative-bus- stop-advertisements/ ativecriminals.com/ambient/creative-bus- stop-advertisements/ 7

Strategic business units (SBU) Operates as a “company within a company” A SBU is organized around some common element such as…. 8 SBU Industry Technology Target Market Customer need

Boston consulting groups growth-share matrix Commonly referred to as the BCG Matrix Develop to evaluate SBU’s performance based industry growth (vertical axis) versus relative market share (horizontal axis) Assists management to determine resource allocation Four categories: Stars, Cash cows, Dogs, Question Marks (see exhibit 2-3, page 34) 9

Boston consulting groups growth-share matrix STARQUESTION MARK CASH COW DOG 10 MARKET SHARE (Cash Generation) LOWHIGH LOW GROWTH RATE (Cash Use)

Marketing Strategies at the SBU LEVEL Marketing managers focus on two key aspects of SBU strategies: 1.Establish a competitive advantage – Superior to or favourably different from competitors – Examples include: price leadership, differentiation strategy 2.Plan growth strategies – (Visit Exhibit 2-5, page 37) 11

Planning business-unit growth strategies 12 The Market/Product Matrix (Exhibit 2-5) Market Penetration Market Development Product Development Diversification NewExisting New Markets Products

The six stages of the Strategic marketing Process 13 Planning stages 1.Identifying and evaluating opportunities 2.Analyzing market segments and selecting target markets 3.Planning a market position and developing a marketing mix strategy 4.Preparing a formal marketing plan 6. Controlling efforts and evaluating the results 5. Executing the plan

Stage One: Identifying and Evaluating Opportunities Situation Analysis: two major components: 1.Environmental scanning & monitoring – External forces and trends are identified as opportunities and threats – Forces include: sociocultural, demographic, economic, etc. 2. Internal analysis – Internal strengths and weakness are identified – Key topics include: customers, suppliers 14

Stage One: Identifying and Evaluating Opportunities Bringing the internal and external analysis together: Strengths (build on) Weaknesses (deal with) Opportunities (take advantage) Threats (avoid) 15 Internal Micro-environment External Macro-environment S.W.O.T

Stage Two: Analyzing Market Segments & Selecting Target Markets Consumer Market (B2C) vs. Organizational Markets (B2B) (Visit exhibit 2-8, page 42) Market segment – Portion of a larger market (i.e. French Canadians) Market segmentation – Dividing the mass market into smaller groups with similar characteristics that are likely to become the target market Target market – The specific group(s) the organization directs its marketing mix towards 16

Stage Three: Market Positioning and Marketing Mix strategy Market position: – How consumers perceive a brand relative to its competition Developing marketing mix (4P’s): – Product – Price – Place (distribution) – Promotion 17 Recall from Chapter 1?

Stage 4: preparing a Formal Marketing Plan The yearly marketing plan is a written report that includes: – Marketing objectives (S.M.A.R.T) – Marketing strategies – Marketing mix – Responsibility allocation – Implementation timeline 18

Stage 5: Executing the marketing plan Putting the plan into action! Management best practices: Ensure resources are properly allocated Clearly understand and communicate goals and expectations Create reasonable expectations and deadlines 19

Stage 6: controlling efforts and evaluation results Marketing Audits: Ensure that planned activities are executed properly Benchmark: establish performance standards Supervision: investigate to ensure tasks have been completed “checking up” Adjustments: evaluate to determine if goals have been achieved – Yes? Continue with the plan – No? Make adjustments and monitor 20

Ethics and Responsibility Worldwide consumerism and environmentalism movements exert pressure for greater responsibility Notion of “caring capitalism” tied to the marketing concept. – Seeking ways to make a profit by serving the best long-run interests of customers and communities. 21

Next Class,…. Case Analysis in BSAD 231, please visit the course website for all the material, and bring them to class (case and case analysis guidelines). 22