Marketing’s Strategic Role in the Organization

The process of determining an organization’s primary objectives, allocating funds, and then initiating actions designed to achieve those objectives. Strategic Planning

The process of anticipating future events and conditions and determining the courses of action necessary to achieve organizational objectives. Planning

Planning at Different Management Levels Top Management Board of Directors Chief Executive Officer (CEO) Chief Operating Officer (COO) Divisional Vice Presidents Types of Planning Strategic Planning Examples Organization- Wide objectives; Fundamental strategies; long- term plans; total budget

Planning at Different Management Levels (cont’d) Middle Management General Sales Manager Marketing Research Manager Advertising Director Types of Planning Tactical Planning Examples Quarterly and semi-annual plans; divisional budgets; divisional policies and procedures

Planning at Different Management Levels (cont’d) Supervisory Management District Sales Manager Supervisors in Staff Marketing Departments Types of Planning Operational Planning Examples Daily and Weekly Plans; Unit Budgets; Departmental Rules and procedures

Marketing Planning The process of anticipating future events and conditions and determining the courses of action necessary to achieve marketing objectives.

Questions Addressed by Marketing Plans Where are we now? Where do we want to be? How do we get there?

Mission A general enduring statement of the overall organizational purpose.

SWOT Analysis A method of studying organizational resources and capabilities to assess the firm’s strengths and weaknesses and scanning its external environment to identify opportunities and threats

Functional strategy Three Levels of Strategy in an Organization Business unit strategy Corporate strategy FinanceMarketing Human resources Research & developmentInformationsystemsManufacturing

Marketing Strategy A firm’s overall program for selecting and satisfying a target market.

Types of information needed for planning and control 1. Situational analysis (SWOT) 2. Demand analysis 3. Buyer behavior and characteristics

1. What do they buy? 2. Who buys? 3. Where do they buy? 4. Why do they buy? 5. How do they buy? 6. When do they buy? 7. How much do they buy? 8. How will buyer behavior and characteristics change in the future?

1. What do they buy? 2. Who buys? 3. Where do they buy? 4. Why do they buy? 5. How do they buy? 6. When do they buy? 7. How much do they buy? 8. How will buyer behavior and characteristics change in the future?

a. Market size potential b. Segments c. Future market trends Market characteristics

1. Who are competitors? 2. Competitor characteristics a. Marketing Programs b. Competitive behavior c. Resources 3. Major strengths and weaknesses 4. Future competitive environment Competition

1. Economic conditions and trends 2. Government regulation and trends 3. Pollution, safety, consumerism concerns 4. Technological trends 5. Political climate General Environment

1. Marketing Resources/Skills 2. Production Resources/Skills 3. Financial Resources/Skills 4. Technological Resources/skills 5. Future trends in internal environment Internal Environment

Marketing Mix Decision

Product Decision What to sell Level of Quality Features Level and Timing of Research # of items to sell Innovativeness of company Packaging When to drop existing products

Middlemen or directly to consumers, how many outlets? Control or cooperate with channel members, purchasing terms, selecting suppliers, delegating functions, identifying competition Place Decisions

Shared or individual promotions? How do we measure effectiveness? What image should we pursue? What level of customer service do we employ? Which media should we use? How should we time our ads? What format should we follow? Promotion Decisions

What will our overall price level be…low-medium-high? What will the range be? What will be the relationship between price and quality? How much emphasis do we put on price? What do we do when competitors raise prices? Price Decisions

The Product/Market Opportunity Matrix

Four Basic Types of Opportunities MarketPenetrationProductDevelopment MarketDevelopment Diversification Present Products New Products PresentMarkets NewMarkets

1. Market Penetration

2. Market Development

3. Product Development

4. Diversification

TOOLS

Strategic Business Unit (SBU) Business Unit built around related product groupings or business activities with its own managers, resources, objectives, competitors, and structure for optimal, independent planning.

10xHigh1xLow0.1x Relative market share (share relative to largest competitor) Star ? Question mark A Dog D Cash cow B C Market growth rate 20%High10%Low0% Boston Consulting Group Growth-Share Matrix

Strategic Planning Grid Low Medium High High Medium Low Investment for growth Market Attractiveness Business Strength Maintain position; seek selective growth and earnings Harvest or divest