1. Strategic Planning and the Marketing Process
Chapter 2
Strategic Planning and the Marketing Process

2. Chapter Objectives
Distinguish between strategic planning and tactical planning.
Explain how marketing plans differ at various levels in an organization.
Identify the steps in the marketing planning process.
Describe successful planning tools and techniques, including Porter’s Five Forces model, first and second mover strategies, SWOT analysis, and the strategic window.
Identify the basic elements of a marketing strategy.
Describe the environmental characteristics that influence strategy decisions.
Describe the methods for marketing planning, including business portfolio analysis and the BCG matrix.

3. Why do Planning?

4. Why do Planning?
To asses the company’s position [strengths and weaknesses], and the opportunities and threats it faces.
To set goals, establish priorities, and develop strategies.
To plan the deployment of resources needed to attain the goals selected.
To give firm direction.
To make sure the goals of all parties are aligned.
To ensure that different functional areas have coordinated efforts.
To outline potential alternative actions the firm can take.
To project costs.
To assess performance.

5. Marketing Planning: The Basics for Strategy and Tactics
Planning: Process of anticipating future events and conditions and of determining the best way to achieve organizational goals
Marketing planning: Implementing planning activities devoted to achieving marketing objectives

6. Strategic Planning versus Tactical Planning
Strategic planning: Process of determining an organization’s primary objectives and adopting courses action that will achieve those objectives
Tactical planning: Process that guides the implementation of activities specified in the strategic plan.

7. Strategic Planning versus Tactical Planning
Top management
Greater proportions of their time engaged in planning
Usually focus their planning activities on long-range strategic issues
Middle level managers
Focus on operational planning; creating and implementing tactical plans
Supervisors
Developing the specific programs to meet goals in their areas of responsibility

8. Table 2.1: Planning at Different Managerial Levels

9. Steps in the Marketing Planning Process

10. Defining the Mission of the Organization
Mission: the essential purpose that differentiates one company from others
The mission statement specifies the organization’s overall goals and operational scope and provides general guidelines for future management actions
“An effective mission statement should be brief enough to fit on a T-Shirt.” – Peter Drucker.

11. Determine Organizational Objectives
An organization lays out its basic objectives, or goals, in its mission statement
These objectives in turn guide development of supporting marketing objectives and plans
Well-developed objectives should state specific, quantitative intentions along with deadlines for achieving them

12. Assessing Organizational Resources and Evaluating Environmental Risks and Opportunities
This step involves a back-and-forth assessment of strengths, risks, and available opportunities.

13. Formulating, Implementing, and Monitoring a Marketing Strategy
Marketing strategy: a firm’s overall program for selecting and satisfying a target market
A marketing strategy is aimed at satisfying consumers in the selected target market through a careful balance of the elements of the marketing mix – each of which represents a subset of the overall marketing strategy

14. Successful Strategies: Tools and Techniques
All planning strategies have the goal of creating a sustainable competitive advantage for a firm.
An advantage where other companies cannot provide the same offering or value.

15. Porter’s Five Forces Model

16. First Mover and Second Mover Strategies
First mover strategy: Theory advocating that the company that is first to offer a product in a marketplace will be the long-term market winner.
Second mover strategy: Theory that advocates observing closely the innovations of first movers and then introducing new products that improve on the original offering to gain advantage in the marketplace.

17. SWOT is an acronym for strengths, weaknesses, opportunities, and threats
A SWOT analysis is a method of studying organizational resources and capabilities to assess the firm’s strengths and weaknesses and scanning its environment to identify opportunities and threats
Strengths reflect Core Competencies – what the company does well

18. SWOT Analysis

19. The Strategic Window
A limited period with an optimal fit between the key requirements of a market and the particular competencies of a firm.

20. Elements of a Marketing Strategy
Blending the four strategy elements of marketing decision-making to satisfy chosen target markets
Product
Price
Distribution
Promotion

21. Target Market
Group of people toward whom the firm decides to direct its marketing efforts

22. Marketing Mix Variables
Product Strategy
What goods or services to offer
Customer service
Package design
Brand names
Trademarks
Warranties
Product Life Cycle
Positioning
New-product development

23. Figure 2.7
Quaker: Using the Product and the Promotional Strategies to Appeal to the Toastables market

24. Elements of the Champion Product Strategy

25. Marketing Mix Variables
Distribution Strategy Planning that ensures that consumers find their products in the proper quantities at the right times and places.
Physical Distribution
Modes of transportation
Warehousing
Inventory control
Order processing
Marketing Channels
Retailers
Wholesalers

26. Marketing Mix Variables
Promotional Strategy
Blending together the various elements of promotion to communicate most effectively with the target market
Informing, persuading, and influencing a consumer’s purchase decision.
Main Elements
Advertising
Promotion
IMC – Integrated Marketing Communications that ensure a unified and consistent message

27. Figure 2.8
Promoting the Healthful Benefits of Milk

28. Advertising As a Part of the Pepto-Bismol Promotional Strategy

29. Marketing Mix Variables
Pricing Strategy
Deals with the methods of setting profitable and justifiable prices
Figure 2.9
Timex: Offering Customers Style and Durability- at a Lower price

30. The Marketing Environment –Marketing Concerns:
Competitive
Political – Legal
Economic
Technological
Social – Cultural
Rule of three [P.52] – The three strongest, most efficient companies dominate 70% to 90% of the market. Examples: Fast Food, Cereal, Running Shoes, Airlines, Pharmaceuticules.

31. Methods for Marketing Planning
Business Portfolio Analysis – evaluate divisions/products to determine strengths and weaknesses
Strategic Business Units (SBUs) are key business units within diversified firms
A division, product line, or single product may define an SBU
Firms redesign their SBUs as market conditions dictate

32. 3M
Tape Products: A 3M Strategic Business Unit

33. The Boston Consulting Group Matrix
Market Share/ Market Growth Matrix: a marketing planning tool that classifies a firm’s SBU’s or products according to industry growth rates and market shares relative to competing products
Stars
Cash Cows
Dogs
Question Marks

34. Figure 2.10
BCG Market Share/Market Growth Matrix

35. Chapter 2 Appendix, Addendum Chapters 3, 22
The Marketing Plan

36. Organizational Planning
Why are we in business? – Vision, Mission
How do we do business? – Values, Climate, Culture
Where are we now? – SWOTs, Competition, Constraints
Where do we want to be? - Strategies
How do we get there? – Tactics, Resources
How do we know we’ve arrived? – Budgets, Controls, Reports, Milestones
Addendum Chapter 22, P.672
Gap Analysis

37. The Marketing Plan
Contains detailed descriptions of the resources and actions needed to achieve stated marketing objectives.

38. Why do a Marketing Plan? To obtain external/internal financing
To provide direction for overall business and marketing strategies
To support the development of long-term and short-term organizational objectives
To guide employees in achieving these objectives
To serve as a standard against which the company’s/unit’s progress can be measured and evaluated

39. Marketing Plan Project

40. Define the Organization’s Mission
Mission – the essential purposes that differentiates us from other companies.
Examples on PP.42,43

41. Marketing Objectives Objectives = Goals
Set by target market[s], product categories in terms of sales, market share, profit, advertising/promotion objectives, customer loyalty, etc.
Must be measurable
Must have a time set for completion
Examples: Chapter Two,P.43 and
Addendum Chapter 3 P.76

42. Perform a Situation Analysis
SWOT is an acronym for strengths, weaknesses, opportunities, and threats
A SWOT analysis is a method of studying organizational resources and capabilities to assess the firm’s strengths and weaknesses and scanning its environment to identify opportunities and threats
Strengths reflect Core Competencies – what the company does well

43. SWOT Analysis

44. Develop a Marketing Strategy
Overall, a companywide program for selecting a particular target market and then satisfying consumers in that market through the marketing mix - product, distribution, promotion, and price.
Compare to competitors
Describe in terms of: market penetration, market development, product development, or diversification
Describe products as: Star, Cash Cow, Question Mark, or Dog
Describe in terms of: invest/grow, selectivity/earnings, or harvest/divest
Describe in terms of: price leadership, product differentiation, product leadership, or following in price/product.
Refer to Addendum Chapter 3, P.76

45. Tactical Plans Market Structure Competitive Analysis
Target Markets/Customers
Product/Services Offering
New Products/Marketing Research
Pricing Strategy & Tactics
Promotional Plans – Advertising & Promotion
Distribution Strategy
Physical Distribution
Marketing Channels
Marketing Staff
Marketing Budgets
Sales Plan
Supporting Documents

46. Monitoring Results Benchmarking Customer Satisfaction Research
Marketing Cost Analysis
Sales Analysis
Marketing Audit
Addendum Chapter 22, PP

47. Next Class January 31 Catch up on Chapters 5 and 8
Read Chapters 9 and 10