Chapter 2STRATEGIC PLANNING

and the

Marketing Process

2-1

STRATEGIC PLANNING: types of plans

• Annual plan

• Long-range plan

• Strategic plan

2-2

STRATEGIC PLANNING: annual plan

• Marketing objectives

• Implementation details

• Detailed budget

2-3

STRATEGIC PLANNING: long range plan

• Long-term objectives

• Major strategies

• Resources required

2-4

STRATEGIC PLANNING

STRATEGIC PLANNING:process

• Identify opportunities in environment

• Match opportunities with capabilities

• Build goals around opportunities

2-5

STRATEGIC PLANNING:steps in strategic planning

Definingthe

companymission

Definingthe

companymission

Settingcompany objectivesand goals

Settingcompany objectivesand goals

Designingthe

businessportfolio

Designingthe

businessportfolio

Planning,marketing,and otherfunctionalstrategies

Planning,marketing,and otherfunctionalstrategies

2-6

STRATEGIC PLANNING:defining the mission

• MISSION STATEMENT• Purpose• Guides people’s efforts• Understand values• Ethical behaviour

2-7

STRATEGIC PLANNING:mission statement criteria

• Market-oriented

• Realistic

• Specific

• Appropriate for the environment

• Based on competencies

• Motivating2-8

STRATEGIC PLANNING:setting goals and objectives

• Business objectives• Marketing objectives• for each level• specific and verifiable• Supporting marketing strategies

2-9

Designing the Business Portfolio

Analyzingthe

currentportfolio

Planfunctionalstrategies

2-10

Developgrowth

strategies

Designing the Business Portfolio:analyzing the current portfolio

• Identify key businesses

• Assess attractiveness of each business

• Determine appropriate support level

2-11

The BCG Growth-Share MatrixThe BCG Growth-Share Matrix

Low

? ? ?? ? ?

Lo

w

High

Hig

h

Mar

ket

gro

wth

rat

e

Relative market share

Star

Cash cow

Question mark

Dog

2-12

The GE Planning GridBusiness strength

AverageStrong Weak

High

Medium

LowIndu

stry

att

ract

iven

ess

2-13

A

B

Designing the Business Portfolio:problems with matrix approaches

• Difficult and time consuming

• Costly

• Focus on current business over future

• Overemphasis on market share and growth

• About 75% of Fortune 500 still find useful

2-14

Designing the Business Portfolio:developing growth strategies

4. Diversification4. Diversification2. Market development

2. Market development

3. Product development

3. Product development

Existingproducts

Newproducts

Existingmarkets

Newmarkets

2-15

1. Marketpenetration

Designing the Business Portfolio:planning functional strategies

• Marketing’s Role• guiding philosophy the marketing concept• identify opportunities• evaluate potential• develop unit marketing strategies

2-16

TargetConsumers

Product

Place Price

Promotion

Mar

ketin

g

Imple

men

tatio

n

MarketingPlanning

MarketingControl

Mar

ketin

g

Analys

is

Competitors

MarketingChannels

PublicsSuppliers

Technological-natural

environment

Political-legal

environment

Social-cultural

environment

Demographic-economicenvironment

2-19

Target Consumers

Market TargetingMarket Targeting

Market PositioningMarket Positioning

Market Segmentation

2-20

Target Consumers:market segmentation

• Group of consumers• With a similar response• To a given set of marketing stimuli

2-21

Target Consumers:market targeting

• Evaluating each segment’s attractiveness• Selecting one or more segments to enter• Single or multiple segment strategy

2-22

Target Consumers:market positioning

• Product occupies:• position in consumer’s mind• clear• distinct• desirable relative to competition

2-23

The Marketing Mix

ProductProduct

Targetconsumers

Targetconsumers

PromotionPromotion

PricePrice

PlacePlace

2-24

Marketing StrategiesFor Competitive Advantage

Market-leaders

Market-followers

Market nichers

2-25

Managing the Marketing Effort

PLANNING

Strategic Plans

Marketing Plans

PLANNING

Strategic Plans

Marketing Plans

IMPLEMENTATION

Carry OutPlans

IMPLEMENTATION

Carry OutPlans

AnalysisAnalysis

CONTROL

Measure Results

Evaluate Results

CorrectiveAction

2-26

Marketing Planning:marketing plan contents

• Executive summary

• Current target market and marketing mix

• Analysis of opportunities and threats

• Objectives and issues

• Marketing strategy

• Action programs

• Budgets and controls

2-27

Marketing Implementation

People

Organizationstructure

Decision &Reward systems

Fit with company culture

2-28

Marketing Organization

• By marketing function performed

• By geographic areas covered

• By product or brand responsibility

• By markets served

• Multiple approaches for large companies

2-29

Marketing ControlSet GoalsSet Goals

MeasurePerformance

MeasurePerformance

EvaluatePerformance

EvaluatePerformance

Take CorrectiveAction

Take CorrectiveAction

2-30