1. Marketing Planning and Organization Strategy
Chapter 4
Marketing Planning and Organization Strategy
Gilbert A. Churchill, Jr J. Paul Peter 1 1 1 1 1

2. Strategic Planning Responsibilities
Slide
4-1a
Strategic Planning Responsibilities
Top Management
Strategic Planning
Long Term
Activities that lead to the development of a clear organizational mission, organizational objectives and the strategies that enable the organization to achieve its objectives. 2 2 2 2 2

3. Tactical Planning Responsibilities
Slide
4-1b
Tactical Planning Responsibilities
Top Management
Strategic Planning
Middle Management
Tactical Planning
MediumTerm
Involves the creation of objectives and strategies aimed at attaining goals for specific divisions or departments over a medium time frame (1-5 years). 3 3 3 3 3

4. Operational Planning Responsibilities
Slide
4-1c
Operational Planning Responsibilities
Top Management
Strategic Planning
Middle Management
Tactical Planning
Lower Management
Operational Planning
Short Term
Involves the creation of objectives and strategies for individual operating units over a short time span (less than 1 year). 4 4 4 4 4

5. The Strategic Planning Process I
Slide
4-2a
The Strategic Planning Process I
Figure
4.1
Information
Implementation
The Environment
The Organizations Strategic Plan
Organizational Mission
Organizational Objectives
Organizational Strategies
Organizational Portfolio Plan
Activities by which people in an organization get the marketing job done.
Source: J. Paul Peter and James H. Donnelly, Jr., A Preface to Marketing Management, 7th ed. (Burr Ridge, Ill.: Irwin, 1997), p. 10. 5 5 5 5 5

6. The Strategic Planning Process II
Slide
4-2b
The Strategic Planning Process II
Business Mission Statement
Business
Objectives
Situation Analysis
Business Strategy
Target Market Strategy
Marketing Mix
Product
Distribution
Promotion
Price
Implementation Evaluation Control
Source: Lamb, Hair, and McDaniel, Marketing, 5th ed. (ITP p. 20.)

7. Slide
4-3
Mission Statement
A statement of the organization’s distinct purpose (i.e., what business are we in). A good mission statement must:
Define and satisfy the key stakeholders (i.e., customers, shareholders, employees)
Not suffer from marketing myopia (i.e., defining it in terms of the offering rather than benefits; e.g., “railway business”, “slide-rule business”)
Not depart too radically from history
Fit the market environment (e.g., GSA - “To prepare young girls for motherhood and wifely duties”)
Specific and Realistic (e.g., SIA - “to become the worlds largest airline”)

8. Criteria for Organizational Objectives
Slide
4-4
Criteria for Organizational Objectives
Realistic
Measurable - 15% ROI, Increase sales by 10%
Clear - for a Defined Period of Time
Consistent with Organizational Objectives
A statement of what is to be accomplished through marketing activities.

9. Strategic Opportunity Matrix
Slide
4-7
Growth Strategies: Product Market Matrix
Figure
4.3
Strategic Opportunity Matrix
Present Products
New Products
Products
Markets
Market Penetration
(Arm & Hammer)
Product Development
(McDonald’s Pizza)
Present Customers
Market Development
(Taco Bell)
Diversification
(Mrs. Tea)
New Customers 6 6 6 6 6

10. Situation Analysis To Identify Marketing Opportunities
Slide
4-5 S
Internal Strengths - Things the company does well (e.g., production, marketing, brand image, employees, brand loyalty). W
Internal Weaknesses - Things the company
does not do well (e.g., high production costs). O
External Opportunities - Conditions in the environment that favor strengths (e.g., unmet demand, technology). T
External Threats - Conditions in the environment that do not relate to existing strengths or favor areas of current weakness (e.g., stronger competitors).

11. Examples of SWOT Issues
Slide
4-6
Examples of SWOT Issues
Table
4.1
Internal Environment
Strengths
Weaknesses
Financial Resources
Well-known brands
Technological Skills
Lack of Strategic Direction
High Costs
Obsolete Facilities
External Environment
Opportunities
Threats
Potential New Markets
Potential New Products
Falling International Trade Barriers
New Competition
Slow Market Growth
New Regulations 7 7 7 7 7

12. BCG Portfolio Matrix Star High Market Growth Rate Cash Cow Dog Low
Slide
4-8b
BCG Portfolio Matrix
Market Growth Rate
Relative Market Share
High
Low
10%
10x
0.1x 1x
Star
Cash Cow
Dog
Problem Child
(question mark)

13. The Boston Consulting Group Matrix
Slide
4-8a
The Boston Consulting Group Matrix
High
Industry Growth Rate
Low
High
Low
Market Share 8 8 8 8 8

14. Market/Industry Attractiveness Business Strength/Position
Slide
4-9
GE Portfolio Matrix
High
Market/Industry Attractiveness
Medium
Low
Strong
Medium
Weak
Business Strength/Position

15. Some Questions for Evaluating a Marketing Plan
Slide
4-10
Some Questions for Evaluating a Marketing Plan
Table
4.2
Are the objectives clear? Specific? Measurable? Challenging, but achievable? Written?
Have the industries that are growing been identified? Those that are stagnant? Those that are declining?
Who are the principal competitors?
What are the organization’s strengths? Weaknesses?
Does the plan take advantage of the organization’s special competencies and vulnerabilities?
What are the target markets?
Do our products and services appeal to the needs and wants of the target markets?
What are the best ways to promote the products to customers?
Where do customers like to purchase?
How do our prices compare with the competition?
What are the costs and benefits of the plan? 9 9 9 9

16. Forecasting Techniques
Slide
4-11a
Forecasting Techniques
Table
4.3
Technique
Benefits
Limitations
Qualitative Methods
Jury of Executive Opinion
Quick; simple; opinions come from executives with expertise in different departments; useful for new or innovative products
Data typically must be broken down by product. region, etc.; consumes time of executives; may not give greatest weight to those with most expertise.
Sales Force Composite
Providing number can motivate salespeople; salespeople know customers, product and competitors.
Salespeople have a vested interest, so they may give biased estimates.
Survey of Buyer Intentions
Based on estimates obtained directly from buyers; can provide detailed information; often provides insight into buyer’s thinking; can be used for new products.
Intention to buy may not result in actual purchase; expensive; time consuming; useful only when there are a few, well-defined potential customers.
Delphi Technique
Estimators less likely to succumb to group pressure.
Time consuming; expensive. 10 10 10 10 10

17. Forecasting Techniques
Slide
4-11b
Forecasting Techniques
Table
4.3
Technique
Benefits
Limitations
Quantitative Methods
Trend Analysis
Quick; inexpensive; effective when demand and environmental factors are stable.
Assumes future is continuation of past; does not consider marketing plans or changes in environment; not useful for new or innovative products.
Exponential Smoothing
Same benefits as trend analysis but emphasizes more recent data.
Same limitations as trend analysis but not as severe because of emphasis on more recent data.
Market Tests
Provide more realistic information because based on actual purchases rather than intent to buy; permits assessment of effects of marketing plan; useful for new or innovative products.
Time consuming; expensive; alerts competition to organization’s plans.
Source: J. Paul Peter and James H. Donnelly, Jr., A Preface to Marketing Management, 7th ed. (Burr Ridge, Ill.: Irwin, 1997), p. 10. 11 11 11 11 11