Presentation on theme: "Strategic Planning ORGANIZATIONAL CAPABILITIES AND GOALS"— Presentation transcript:
0 Company and Marketing Strategy: Partnering to Build Customer Relationships Chapter 2
1 Strategic Planning ORGANIZATIONAL CAPABILITIES AND GOALS MARKETING OPPORTUNITIESStrategic 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.”
4 Market-Oriented Mission Marketing ManagementA mission statement should be:An “invisible hand”Neither too narrow nor too broadFitting of market environmentBased on distinctive competenciesMotivatingA mission statement asks..What is our business?Who is the customer?What do consumers value?What should our business be?
5 Sample MissionA 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 PlanningCompany Objectives must tie to Marketing ObjectivesCompany MissionBusiness ObjectivesMarketing Objectives
8 Analyze PortfolioBusiness 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 PlanningDesigning 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 portfolioShaping 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 rateThe SBU’s relative market share within the market.Portfolio DesignStep 1: Analyze the current business portfolioStep 2: Shape the future business portfolio
12 SBUsA 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.LOWHIGHLOWRelative Market Share
15 Analyzing Current SBU’s: GE’s Strategic Business-Planning Grid Business StrengthStrongAverageWeakCHighAMediumIndustry AttractivenessDBLow
16 Analyzing the Current Business Portfolio Marketing ManagementAnalyzing the Current Business PortfolioBuildIncrease market shareWorks well for question marksHoldPreserve market shareGood for cash cowHarvestIncreases short-term cash flowGood for weak cash cows, question marks and dogsDivestSell or liquidateGood for dogs and question marks
17 Strategic Planning Portfolio Design Determine the future role of each SBU and choose the appropriate resource allocation strategy:BuildHoldHarvestDivestSBUs change positions over timePortfolio DesignStep 1: Analyze the current business portfolioStep 2: Shape the future business portfolio
18 Develop Growth Strategies Strategic PlanningPart 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
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 ElementsAnalyzing marketing opportunitiesSelecting target marketsDeveloping the marketing mixManaging 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 ElementsAnalyzing marketing opportunitiesSelecting target marketsDeveloping the marketing mixManaging the marketing effort
23 Marketing Strategy Strategy Market Segmentation Target marketing Customers grouped by:GeographicDemographicPsychographicBehavioralMarket segment is a groups of consumers who respond in similar ways to marketing efforts.Market SegmentationTarget marketingMarket Positioning
24 Marketing Strategy Strategy Evaluation of each segment’s attractivenessSelection of segments with greatest long-term profitabilityA company can choose one or several segments to targetMarket SegmentationTarget marketingMarket Positioning
25 Marketing Strategy Strategy Market Segmentation Target marketing The place the product occupies in the consumer’s mindProducts are positioned relative to competing productsMarketers look for clear, distinctive and desirable place in positioningMarket SegmentationTarget marketingMarket 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 ElementsAnalyzing marketing opportunitiesSelecting target marketsDeveloping the marketing mixManaging the marketing effort
27 Marketing MixThe marketing mix includes controllable and tactical marketing tools knows as the 4P’sThe 4P’s includeProductPlacePromotionPrice
29 The Marketing Process Key Elements Analyzing marketing opportunities Marketing analysisProvides information helpful in planning, implementation, and controlMarketing planningStrategies and tacticsMarketing implementationTurns plans into actionMarketing controlOperating controlStrategic controlKey ElementsAnalyzing marketing opportunitiesSelecting target marketsDeveloping the marketing mixManaging the marketing effort
31 S W O T Marketing Analysis Strengths Weaknesses Opportunities Threats INTERNALOpportunitiesOThreatsTSWOT 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).EXTERNALPOSITIVENEGATIVE
32 Managing the Marketing Effort Marketing FunctionsMarketing plans include:Executive summaryAnalysis of current situationObjectivesTargets and positioningMarketing mixBudgetControlsAnalysisPlanningImplementationControl
33 Managing the Marketing Effort Marketing FunctionsPlans are turned into action with day-to-day activitiesGood implementation is a challengeAnalysisPlanningImplementationControl
34 Managing the Marketing Effort Marketing FunctionsEvaluation of the results of marketing strategiesChecks for differences between goals and performanceAnalysisPlanningImplementationControl