2 | 2copyright © houghton mifflin company. all rights reserved. how often do you eat a bowl of...

2 | 2Copyright © Houghton Mifflin Company. All rights reserved.

How often do you eat a bowl of Cereal?

A) Hardly Ever

B) 1 to 2 times a week

C) 3 or 4 times a week

D) More than 3 or 4 times a week


How often do you eat cereal other than for breakfast?

A) Never

B) Every so often

C) Once a week

D) More than once a week


Cereality

http://www.cereality.com/intro.html

Chapter 2Planning, Implementing,

and ControllingMarketing Strategies


1. STRATEGIC PLANNING

The process of establishing an organizational mission and formulating goals, corporate strategy, marketing objectives, marketing strategy, and a marketing plan.


Coca-Cola’sStrategic Priorities

1. Accelerate carbonated soft-drink growth, led by Coca-Cola.

2. Selectively broaden our family of beverage brands to drive profitable growth.

3. Grow system profitability and capability together with our bottling partners.

4. Serve customers with creativity and consistency to generate growth across all channels.

5. Direct investments to highest-potential areas across markets.

6. Drive efficiency and cost effectiveness everywhere.Coca-Cola, “Six Strategic Priorities(2002), http://www2.coca-cola.com/investors/annualreport/2002/sixstrateg.htm

http://www.coca-cola.com/template1/index.jsp?locale=en_US&site=../downloads/downloads.html

http://www.coca-cola.com/HF/index.jsp

http://www2.coca-cola.com/investors/annualreport/2002/sixstrateg.htm


Marketing Strategy

A plan of action for identifying and analyzing a target market and developing a marketing mix to meet the needs of that market.

– Marketing Plan

(Lipton targets health-concious consumers. Page 29)

http://www.youtube.com/watch?v=I_nNwSmstpY


2. ASSESSING ORGANIZATIONAL RESOURCES AND OPPORTUNITIES

• Assessing financial and human resources

– Capabilities vs. changes

– Marketing and financial affect

• Goodwill, reputation and brand as resources

http://www.youtube.com/watch?v=TRlgc6GA924

http://www.youtube.com/watch?v=Ow6lg2tAqsY

http://www.youtube.com/watch?v=ojeaH1HQu7E

hhttp://www.youtube.com/watch?v=xMvRSmkxXgY


Core Competencies

Things a firm does extremely well, which sometimes give it an advantage over its competition.


Market Opportunity

A combination of circumstances and timing that permits an organization to take action to reach a particular target market.


Strategic Windows

Temporary periods of optimal fit between the key requirements of a market and the particular capabilities of a firm competing in the market.


Competitive Advantage

The result of a company’s matching a core competency to opportunities it has discovered in the marketplace.

Dell vs. Apple

http://www.apple.com/retail/

http://www.macnewsworld.com/story/33061.html


SWOT Analysis

Strengths

Weaknesses

Opportunities

Threats

Figure 2.2


3. ESTABLISHING AN ORGANIZATIONAL MISSION AND GOALS

• Mission Statement Answers:– Who are our customers? – What is our core competency?

• Corporate Identity– Unique Symbols– Personalities– Philosophies

http://www.youtube.com/watch?v=hdjL8WXjlGI

http://www.starbucks.com/about-us

http://www.youtube.com/watch?v=ijdcyyLcUok


MarketingObjective Characteristics

Clear, simple terms

Measurable

Specify time frame

Consistent with unit and corporate strategy


Which of the following would be a good objective?

A) Increase Market share

B) Increase Brand Awareness

C) Increase Sales

D) Increase Market Penetration by 10% over the next quarter


Promotional Elements at Jordan’s Furniture

http://www.jordans.com/


Microsoft Announces Shift In Corporate Strategy

• “Trustworthy Computing”

• Emphasize security and privacy over new capabilities

• Highest priority is to ensure that computer users continue to venture across an increasingly Internet-connected world

• “Microsoft announces corporate strategy toward security and privacy”

Information Security News, “Microsoft announces corporate strategy toward security and privacy”, Jan. 2002, http://seclists.org/lists/isn/2002/Jan/0092.html

http://www.youtube.com/watch?v=ZSBipeAAfcI&NR=1

http://seclists.org/lists/isn/2002/Jan/0092.html


Which video game console maker was the “winner” last year?

A) Microsoft

B) Sony

C) Nintendo


Business-Unit Strategy

• Strategic Business Unit (SBU)

– A division, product line, or other profit center within the parent company.


Band-Aid is a strategic business unit of Johnson&Johnson

Reprinted with permission of Johnson & Johnson Consumer Companies, Inc.

http://www.jnj.com/product/categories/index.htm


Growth Share Matrix

Figure 2.4


5. THE MARKETING PLAN

The process of assessing marketing opportunities and resources, determining marketing objectives, defining marketing strategies, and establishing guidelines for implementation and control of the marketing program.


6. MARKETING IMPLEMENTATION

The process of putting marketing strategies into action.

– Intended Strategy– Realized Strategy

http://www.youtube.com/watch?v=GNXz59_vf4E

http://www.stores.org/pdf/07TOP100Chart.pdf


Components OfThe Marketing Plan


Controlling Marketing Activities

Figure 2.5

The Marketing Environment


The Natural Environment

– Concern for the natural environment has grown steadily, increasing the importance of these trends:• Shortage of raw materials• Increased pollution• Increased green

marketing/emphasis on sustainability

http://www.bloomberg.com/markets/commodities/energyprices.html

http://www.oe.netl.doe.gov/docs/eads/ead122303.doc

http://www.msnbc.msn.com/id/21134540/vp/25717740#25717740


China Looming (2004)

• China second largest consumer of oil (after the U.S.) Currently at 8%

• China has been responsible for nearly two-fifths of the increase in global consumption since 2000.

• China's surge in energy demand is also the main reason for the doubling in the world price of coal over the past year. Last year China consumed 40% of all the coal and 30% of all the steel in the world.


1. THE MARKTING ENVIRONMENT

•Environment Scanning: The process of collecting information about the forces in the marketing environment.

•Environmental Analysis


Objectives Of Environmental Scanning

Detect scientific, technical, economic, social and political trends/events

Define potential threats, opportunities, or changes implied by trends/events

Promote future orientation in management/staff thinking

Alert management/staff to trends converging, diverging, speeding up, slowing down or interacting

Horizon Site, “Environmental Scanning” by James Morrison, 1992, http://horizon.unc.edu/courses/papers/enviroscan/

http://horizon.unc.edu/courses/papers/enviroscan/


Responding To Environmental Forces

• Accept as uncontrollable- passive and reactive

• Attempt to influence and shape them-proactive

– Constructive

– Bring desired results

– Are limits(Toyota responding to environmental forces. Page 59)


2. COMPETITIVE FORCES

• Competition

– Brand Competitors

– Product Competitors

– Generic Competitors

– Total Budget Competitors

(Volvic brand competitors include Fiji and Evian. Page 60)

http://www.jonessoda.com/


Competitive Structures

Royal Mail Monopoly

http://www.youtube.com/watch?v=q-jOjK003Yk

http://news.bbc.co.uk/1/hi/business/4274335.stm


Monitoring Competition

• Price- most competitors monitor

• Do more than analyze information

• Develop ongoing system for gathering information

• Understand market - customer needs

• Helps in recognition of own strategy flaws


3. ECONOMIC FORCES

• Economic Conditions

• Buying Power

• Willingness to Spend


http://www.google.com/publicdata/explore?ds=usunemployment&met=unemployment_rate&idim=state:ST410000&dl=en&hl=en&q=oregon+unemployment+statistics



Buying Power

•Income– Disposable Income– Discretionary Income

•Wealth


2000 Median Household income

All $37,000African-American $29,500Hispanic $28,600Caucasian $48,100Asian-Pacific Islander $54,100


2004 Mean Household income

All $60,500African-American $40,700Hispanic $45,900Caucasian $65,300Asian-Pacific Islander $76,700


Willingness To Spend

An inclination to buy because of expected satisfaction from a product, influenced by the ability to buy and numerous psychological and social forces.


American Consumer Satisfaction Index

“U.S. Automakers Slippingin Consumer Satisfaction”

Source: “American Customer Satisfaction Index,” University of Michigan Business School, Sept. 2005, www.theacsi.com

Figure 3.1


4. POLITICAL FORCES

• Legislation enacted

• Legal decisions interpreted by courts

• Regulatory agencies created and operated

• Marketers

– Adjust to conditions

– Influence through contributions


Top Corporate DonorsBy Political Party


5. LEGAL ANDREGULATORY FORCES

• Procompetitive legislation- preserves competition

• Consumer Protection legislation– Protect people from harm– Prohibit hazardous products– Information disclosure– Particular marketing activities

• Encourage compliance

• Regulatory Agencies

• Self-Regulatory forces


Regulatory Agencies


Self-Regulatory Forces

• Trade Associations• Better Business Bureau• National Advertising Review Board• Advantages

– Less expensive– More realistic

• Limitations– Nonmember firms do not have to abide– Lack of enforcement tools– Often less strict


6. TECHNOLOGICAL FORCES

•Impact of Technology– Effects include:

• Dynamics• Reach• Self-Sustaining

•Adoption and Use of Technology

(Monster.com has changed the way people search for jobs. Page 72)


Who is the number one seller of music in the world?

A) Wal-Mart

B) I-tunes

C) Hear Music/Starbucks

D) Columbia House


7. SOCIOCULTURAL FORCES

The influences in a society and its culture(s) that change people’s attitudes, beliefs, norms, customs, and lifestyles.


Issues Of Sociocultural Forces

• Demographic and diversity characteristics

– Age, gender, race, ethnicity

– Marital/parental status, income, education

• Cultural Values

– Health

– Family

– Environment

• Consumerism- efforts to protect consumers’ rights


Marketing to changing demographics# of People age 65 an older will double by 2050

Reprinted with permission by AllianzLife Insurance Company of North America


Costco

• Markups only 14%• Hourly employees $40,000 after 4 years• Generous return policy

– “Costco continues to be a company that is better at serving the club member and employee than the shareholder”

• Axioms– 1. Obey the law– 2. Take care of your customers– 3. Take care of your employees– 4. Practice the intelligent loss of sales (SKUs)


• Organizational culture shared values and beliefs that underlie a company’s identity.

2-1

McGraw-Hill © 2005 The McGraw-Hill Companies, Inc. All rights reserved.

Organizational Culture

McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc. All rights reserved.


A Conceptual Framework for Understanding Organizational Culture

McGraw-Hill © 2005 The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc. All rights reserved.


2-3

Layers of Organizational Culture


Source: Adapted from E H Schein, Organizational Culture and Leadership, 2nd ed (San Francisco: Jossey-Bass, 1992), p 17.

Observable

Artifacts

Espoused

Values

Basic Underlying

Assumptions



2-4 Figure 2-2

Four Functions of Organizational Culture


Organizationalculture

Sense-makingdevice

Organizationalidentity

Social systemstability

Collectivecommitment



2-5 Table 2-1

Types of Organizational Culture


High priority on constructive interpersonal relationships, and focus on work group satisfaction

AffiliativeConstructive

Participative, employee-centered, and supportive

Humanistic-encouraging

Constructive

Value self-development and creativity

Self-actualizing

Constructive

Goal and achievement oriented

AchievementConstructive

Organizational Characteristics

Normative Beliefs

General Types of Culture



2-6 Table 2-1

Types of Organizational Culture (Cont.)


Negative reward system and avoid accountability

AvoidancePassive-defensive

Nonparticipative, centralized decision-making, and employees do what they’re told

DependentPassive-defensive

Conservative, bureaucratic and people follow the rules

Conventional

Passive-defensive

Avoid conflict, strive to be liked by others and approval oriented

ApprovalPassive-defensive


Normative Beliefs




2-7 Table 2-1

Types of Organizational Culture (Cont.)


Perfectionistic, persistent and hard-working

Perfectionistic

Aggressive-defensive

Winning is valued and a win-lose approach is used

CompetitiveAggressive-defensive

Nonparticipative, take charge of subordinates and responsive to superiors

PowerAggressive-defensive

Confrontation and negativism awarded

OppositionalAggressive-defensive


Normative Beliefs




What researchers have learned

• Constructive culture is positively related with employee behavior and attitude (DUHHHH)

• People felt more comfortable in companies whose culture matched their personal value systems (Double Duhhhh)

• No correlation between company culture and financial performance (Whatttt?)

• Flexible cultures more likely to yield higher financial performance (Interesting)

• 7 of 10 mergers and acquisitions fail to meet their financial promise (can culture be an issue? HP/Compaq)


1. Formal statements of organizational philosophy, mission, vision, values, and materials used for recruiting, selection and socialization

2. The design of physical space, work environments, and buildings

3. Slogans, language, acronyms, and sayings4. Deliberate role modeling, training

programs, teaching and coaching by managers and supervisors

5. Explicit rewards, status symbols (e.g., titles),and promotion criteria

6. Stories, legends, and myths about key people and events

2-8


Embedding Organizational Culture



7. The organizational activities, processes, or outcomes that leaders pay attention to, measure, and control

8. Leader reactions to critical incidents and organizational crises

9. The workflow and organizational structure

10.Organizational systems and procedures11.Organizational goals and the associated

criteria used for recruitment, selection, development, promotion, layoffs, and retirement of people

2-9


Embedding Organizational Culture (Cont.)



HR is the keeper of:• Selection• Socialization• Training and Development• Evaluation Systems

L2-1


HR EmbedsOrganizational Culture

Culture

Culture

McGraw-Hill-Irwin © 2006 The McGraw-Hill Companies, Inc. All rights reserved.


HR Benefits when:• The founder’s personality is charismatic,

vibrant, honest and ethical• Leonard Gentine of Sargento Foods: after his

death, the family keeps his spirit alive through his image and presenting a Founder’s Ring to employees best displaying Sargento culture

• Charles Schwab believed that employees should follow the company’s values or be fired: his own son was fired after giving investment advice: a no-no in Schwab culture

L2-2


Embedding a Culture Based on aFounder’s Personality



L2-3

Embedding a Culture Based on aFounder’s Personality


HR is challenged when:• The founder is involved in scandal or

engages in questionable public activity• Henry Ford stepped down from the

company and got involved in politics and anti-Semitism

• Martha Stewart carefully crafted her brand based on her image as a wholesome homemaker only to be convicted of securities fraud



L2-4

HR and Employee Ownership


HR builds employee ownership of culture:

• Peg employee recognition to the corporate culture.

• Connect culture to the bottom line.• Emphasize the company’s history.• Communicate constantly with all levels

of employees.Our

Culture



2-10 Figure 2-3

A Model of Organizational Socialization


Phases Perceptual and Social Processes

1. Anticipatory Socialization

Learning that occurs prior to joining the organization

• Anticipating realities about the organization and the new job• Anticipating organization’s needs for one’s skills and abilities• Anticipating organization’s sensitivity to one’s needs and values



2-11 Figure 2-3

A Model of Organizational Socialization (Cont.)


Phases Perception and Social Processes

2. Encounter

Values, skills and attitudes start to shift as new recruit discovers what theorganization is trulylike

• Managing lifestyle- versus-work conflicts• Managing intergroup role conflicts • Seeking role definition and clarity• Becoming familiar with task and group dynamics



2-12 Figure 2-3

A Model of Organizational Socialization (Cont.)


Phases Perception and Social Processes

3. Change and acquisition

Recruit masters skills and roles and adjusts to workgroup’s values and norms

• Competing role demands are resolved• Critical tasks are mastered • Group norms and values are internalized



Examples of Socialization

• Good

• Bad


2-14 Table 2-2

Socialization Tactics


Sequential: fixed progression of steps that culminate in the new role; Random: ambiguous or dynamic progression

Sequential vs. Random

Formal: Segregating newcomer from regular organization members; Informal: not distinguishing between newcomer and experienced members

Formal vs. Informal

Collective: consists of grouping newcomers and exposing them to a common set of experiences; Individual: exposing each individually to a set of unique experiences

Collective vs. Individual

DescriptionTactic



2-15 Table 2-2

Socialization Tactics (Cont.)


Investiture: affirmation of newcomer’s incoming global and specific role identities and attributes; Divestiture: denial and stripping away of the newcomer’s existing sense of self to rebuild in the organization’s image

Investiture vs. Divestiture

Serial: newcomer is socialized by an experienced member; Disjunctive: does not use a role model

Serial vs. Disjunctive

Fixed: provides a timetable for the assumption of the role; Variable: does not provide timetable

Fixed vs. Variable

DescriptionTactic



Mentoring is the process of forming and maintaining developmental relationships between a mentor and a junior person

2-16


Mentoring and Functions of Mentoring

Functions of Mentoring• Career Functions

- Sponsorship- Exposure-and-visibility- Coaching- Protection- Challenging assignments

• Psychosocial Functions- Role modeling- Acceptance-and-confirmation- Counseling- FriendshipMcGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

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