1. Principles of Marketing
Lecture-6

2. Summary of Lecture-5

3. Marketing Challenges in the 21st century

4. Threat of Substitute Products Threat of New Entrants
Bargaining Power of Buyers
Bargaining Power of Suppliers
Threat of New Entrants
Rivalry Among Competing Firms in Industry * 23

5. The Information Technology Boom
Rapid Globalization
The Changing World Economy
The Call for more ethical and social Responsibility
The New Marketing Landscape

6. Today’s Topics

7. Strategic Planning and Marketing Process

8. Strategic planning
The process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities.

9. Planning--what are we going do and how are we going to do it?

10. Why Plan? Address changing environment and consumers
Develop shared goals within organization
Address competitive threat

11. Planning is no fun! Who likes to think about the future?
It is just an unnatural act!

12. If you fail to plan, you plan to fail.

13. Planning requires that you:
What do
you see?
Anticipate the future
Determine actions that are needed to achieve objectives

14. The Planning Process

15. Environmental Analysis
Mission & Objective Setting
Marketing Strategy Development
Action Plans

16. Characteristics of a Strategic Plan

17. Broad in Scope
Long Range: Years
Focus on Organizational Objectives
Initiated and Managed by Top Management
Becomes Basis for Tactical Planning & Operations

18. Strategic Planning Conducted by Board, CEO, Division VPs
Sets Objectives
Fundamental Strategies

19. Tactical Planning
Middle Management - Sales Mgr., Mkt. Research Director, Advertising Director
Quarterly & Semi-Annual Plans
Departmental Policies and Procedures
Budget Allocations

20. Operational Planning
District Sales Managers, Staff Marketing Supervisors
Daily and Weekly Plans
Departmental Rules & Procedures

21. It is more important to do what is strategically right than what is immediately profitable. --Phillip Kotler

22. SWOT Analysis
Strengths
Weaknesses
Opportunities
Threats

23. Steps in Strategic Planning

24. Corporate Level Business unit, product, and market level Planning,
marketing,
and other
functional
Strategies
Defining the
Company
Mission
Setting Company
Objectives
and Goals
Designing
the Business
Portfolio

25. Strategic Planning involves developing an overall company strategy for long-run survival and growth.

26. This process involves:
Defining a Mission: Statement of an organization’s purpose; should be market oriented.
Setting Company Objectives: Supporting goals and objectives to guide the entire company.
Designing a Business Portfolio: Collection of businesses and products that make up the company.
Planning Functional Strategies: Detailed planning for each department designed to accomplish strategic objectives.

27. Defining the Company’s Business and Mission

28. A Mission Statement is a Statement of the Organization’s Purpose.
Characteristics of a Good Mission Statement:
Market Oriented
Realistic
Fit Market Environment
Distinctive Competencies
Motivating
Specific

29. Setting Company Objectives and Goals

31. Designing the Business Portfolio

32. Business Portfolio: The collection of business and products that make up the company
Portfolio Analysis: A tool by which management evaluates the various business making up the company
Strategic Business Unit (SBU): A unit of the company that has a separate mission and objectives and that can be planned independently from other company business

33. The best portfolio is the one that best fits the company’s strengths and weaknesses to the opportunities in the environment.
The company must:
analyze its current business portfolio or Strategic Business Units (SBU’s)
decide which SBU’s should receive more, less, or no investment
develop growth strategies for adding new products or businesses to the portfolio

34. The Boston Consulting Group’s Growth-Share Matrix

35. ? ? ? ? 4 1 3 5 2 8 6 7 Market growth rate Relative market share Stars
20%-
18%-
16%-
14%-
12%-
10%-
8%-
6%-
4%-
2%-
Stars
Question marks 4 ? ? 1 3 ? ? 5 2
Market growth rate
Dogs
Cash cow 8 6 7
10x x 2x 1.5x 1x
.5x .4x .3x .2x .1x
Relative market share 2

36. Enough for today. . .

37. Summary

38. Strategic Planning and Marketing Process

39. Corporate Level Business unit, product, and market level Planning,
marketing,
and other
functional
Strategies
Defining the
Company
Mission
Setting Company
Objectives
and Goals
Designing
the Business
Portfolio

40. ? ? ? ? 4 1 3 5 2 8 6 7 Market growth rate Relative market share Stars
20%-
18%-
16%-
14%-
12%-
10%-
8%-
6%-
4%-
2%-
Stars
Question marks 4 ? ? 1 3 ? ? 5 2
Market growth rate
Dogs
Cash cow 8 6 7
10x x 2x 1.5x 1x
.5x .4x .3x .2x .1x
Relative market share 2

41. Next….

42. BCG Marketing Process Analyzing marketing opportunities
Selecting target markets

43. Principles of Marketing
Lecture-6