0. Company and Marketing Strategy: Partnering to Build Customer Relationships
Chapter 2

1. Strategic Planning ORGANIZATIONAL CAPABILITIES AND GOALS
MARKETING OPPORTUNITIES
Strategic planning is the process of developing and maintaining a fit between the organization’s goals and capabilities and its changing marketing opportunities.

2. Strategic Planning Strategic planning is defined as:
“The process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities.”

3. Steps in the Strategic Planning Process

4. Market-Oriented Mission
Marketing Management
A mission statement should be:
An “invisible hand”
Neither too narrow nor too broad
Fitting of market environment
Based on distinctive competencies
Motivating
A mission statement asks..
What is our business?
Who is the customer?
What do consumers value?
What should our business be?

5. Sample Mission
A mission statement should be meaningful and specific, motivating, and not be stated as making sales or profits.
“We help you organize the world’s information and make it universally accessible and useful.”

6. Disney
“We create fantasies— a place where dreams come true and America still works the way it’s supposed to”

7. Company Objectives must tie to Marketing Objectives
Strategic Planning
Company Objectives must tie to Marketing Objectives
Company Mission
Business Objectives
Marketing Objectives

8. Analyze Portfolio
Business portfolio: “the collection of businesses and products that make up the company.”
Portfolio analysis is a major activity in strategic planning whereby management evaluates the products and businesses that make up the company.
The best portfolio is the one that best fits the company’s strengths and weaknesses to opportunities in the environment.

9. Strategic Planning
Designing the business portfolio is a key step in the strategic planning process.
The best portfolio is the one that best fits the company’s strengths and weaknesses to opportunities in the environment.

10. The Business Portfolio
Business portfolio planning involves two steps:
Analyzing the current business portfolio
Shaping the future portfolio by developing strategies

11. Strategic Planning Portfolio Design
Identify strategic business units (SBUs)
Assess each SBU:
The BCG growth-share matrix classifies SBUs into one of four categories using:
Market growth rate
The SBU’s relative market share within the market.
Portfolio Design
Step 1: Analyze the current business portfolio
Step 2: Shape the future business portfolio

12. SBUs
A strategic business unit (SBU) is a unit of the company that has a separate mission and objectives and that can be planned independently from other company businesses.
Portfolio analysis calls for management to assess the attractiveness of its various SBUs and decide how much support each deserves.

13. Portfolio - BCG Matrix Market Growth Rate Relative Market Share $ HIGH
The Boston Consulting Group (BCG) Approach defines four types of SBUs:
Stars are high-growth, high-share businesses or products requiring heavy investment to finance rapid growth. They will eventually turn into cash cows.
Cash cows are low-growth, high-share businesses or products that are established and successful SBUs requiring less investment to maintain market share.
Question marks are low-share business units in high- growth markets requiring a lot of cash to hold their share.
Dogs are low-growth, low-share businesses and products that may generate enough cash to maintain themselves but do not promise to be large sources of cash.
LOW
HIGH
LOW
Relative Market Share

14. Growth-Share Matrix

15. Analyzing Current SBU’s: GE’s Strategic Business-Planning Grid
Business Strength
Strong
Average
Weak C
High A
Medium
Industry Attractiveness D B
Low

16. Analyzing the Current Business Portfolio
Marketing Management
Analyzing the Current Business Portfolio
Build
Increase market share
Works well for question marks
Hold
Preserve market share
Good for cash cow
Harvest
Increases short-term cash flow
Good for weak cash cows, question marks and dogs
Divest
Sell or liquidate
Good for dogs and question marks

17. Strategic Planning Portfolio Design
Determine the future role of each SBU and choose the appropriate resource allocation strategy:
Build
Hold
Harvest
Divest
SBUs change positions over time
Portfolio Design
Step 1: Analyze the current business portfolio
Step 2: Shape the future business portfolio

18. Develop Growth Strategies
Strategic Planning
Part of strategic planning entails evaluating growth strategies.
Marketing must identify, evaluate, and select growth opportunities and lay down strategies for capturing them.
Develop Growth Strategies

19. Product / Market Expansion Grid

20. The Marketing Process Key Elements Analyzing marketing opportunities
The strategic planning and business portfolio analysis processes help to identify and evaluate marketing opportunities.
The purpose of the marketing process is to help the firm plan how to capitalize on these opportunities.
Key Elements
Analyzing marketing opportunities
Selecting target markets
Developing the marketing mix
Managing the marketing effort

21. The Marketing Process Key Elements
The segmentation process divides the total market into market segments.
Target marketing chooses which segment(s) are pursued.
Market positioning for the product is then determined.
Key Elements
Analyzing marketing opportunities
Selecting target markets
Developing the marketing mix
Managing the marketing effort

22. The Value Delivery Process

23. Marketing Strategy Strategy Market Segmentation Target marketing
Customers grouped by:
Geographic
Demographic
Psychographic
Behavioral
Market segment is a groups of consumers who respond in similar ways to marketing efforts.
Market Segmentation
Target marketing
Market Positioning

24. Marketing Strategy Strategy
Evaluation of each segment’s attractiveness
Selection of segments with greatest long-term profitability
A company can choose one or several segments to target
Market Segmentation
Target marketing
Market Positioning

25. Marketing Strategy Strategy Market Segmentation Target marketing
The place the product occupies in the consumer’s mind
Products are positioned relative to competing products
Marketers look for clear, distinctive and desirable place in positioning
Market Segmentation
Target marketing
Market Positioning

26. The Marketing Process Key Elements Analyzing marketing opportunities
Competitor analysis guides competitive marketing strategy development.
Strategy leads to tactics via the marketing mix:
The “Four Ps” – product, price, place, promotion (seller viewpoint)
The “Four Cs” – customer solution, cost, convenience, and communication (customer viewpoint)
Key Elements
Analyzing marketing opportunities
Selecting target markets
Developing the marketing mix
Managing the marketing effort

27. Marketing Mix
The marketing mix includes controllable and tactical marketing tools knows as the 4P’s
The 4P’s include
Product
Place
Promotion
Price

28. The Marketing Mix

29. The Marketing Process Key Elements Analyzing marketing opportunities
Marketing analysis
Provides information helpful in planning, implementation, and control
Marketing planning
Strategies and tactics
Marketing implementation
Turns plans into action
Marketing control
Operating control
Strategic control
Key Elements
Analyzing marketing opportunities
Selecting target markets
Developing the marketing mix
Managing the marketing effort

30. Managing the Marketing Effort
Marketing Functions
Finding opportunities
Avoiding threats
Understanding strengths
Analyzing weaknesses
Analysis
Planning
Implementation
Control

31. S W O T Marketing Analysis Strengths Weaknesses Opportunities Threats
INTERNAL
Opportunities O
Threats T
SWOT analysis: a summary of the ideas developed in the situation analysis, which allows managers to focus clearly on the meaningful strengths (S) and weaknesses (W) in the firm’s internal environment and opportunities (O) and threats (T) coming from outside the firm (the external environment).
EXTERNAL
POSITIVE
NEGATIVE

32. Managing the Marketing Effort
Marketing Functions
Marketing plans include:
Executive summary
Analysis of current situation
Objectives
Targets and positioning
Marketing mix
Budget
Controls
Analysis
Planning
Implementation
Control

33. Managing the Marketing Effort
Marketing Functions
Plans are turned into action with day-to-day activities
Good implementation is a challenge
Analysis
Planning
Implementation
Control

34. Managing the Marketing Effort
Marketing Functions
Evaluation of the results of marketing strategies
Checks for differences between goals and performance
Analysis
Planning
Implementation
Control

35. Managing the Marketing Effort

36. The Marketing Process