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C H A P T E R

Developing Marketing Strategies and a Marketing Plan

2

McGraw-Hill/Irwin Copyright © 2014 by the McGraw-Hill Companies, Inc. All rights reserved.

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L E A R N I N G O B J E C T I V E S

Define a marketing strategy.

Describe the elements of a marketing plan.

Analyze a marketing situation using SWOT analysis.

Describe how a firm chooses which consumer group(s) to pursue with its marketing efforts.

Outline the implementation of the marketing mix as a means to increase customer value.

Summarize portfolio analysis and its use to evaluate marketing performance.

Describe how firms grow their business.

Developing Marketing Strategies and a Marketing Plan

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Sustainable Competitive Advantage

Customer value

Customer excellence

Operational excellence

Product excellence

Locational excellence

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CHECK YOURSELF

1. What are the various components of a marketing strategy?

2. List the four macro strategies that can help a firm develop a sustainable competitive advantage.

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The Marketing Plan

PlanningPhase

ImplementationPhase

ControlPhase

Step 1: Businessmission & objectives

Step 2: Situation analysisSWOT

Step 5: Evaluate performanceusing marketing metrics

Step 3: Identify opportunities

Segmentation Targeting Positioning

Step 4: Implement marketing mix

Product Price Place Promotion

Marketingstrategy

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Three Phases of a Strategic Plan

Planning Implementing Controlling

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Step 1: Define the Business Mission

MADD mission statement:MADD strives to stop drunk driving, support the victims of this violent crime and prevent underage drinking.

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Step 2: Conduct a Situation Analysis

StrengthsStrong brandStrong celebrity endorsersInnovative products

StrengthsStrong brandPortfolio of brandsStrong global presence

WeaknessOverreliance on footwear

WeaknessManagement of numerous brands

OpportunityEmerging countriesOther fashion segments

OpportunityEmerging countries

ThreatsCheaper importsImitation productsRetail becoming price competitive

ThreatsCheaper importsImitation productsRecessionary forces

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Step 3: Identifying and Evaluating Opportunities Using STP

Segmentation

Targeting

Positioning

Courtesy The Hertz Corporation

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Step 4: Implement Marketing Mix and Allocate Resources

Product Value Creation

Price Value Capture

Place Value Delivery

Promotion Value

Communication

Courtesy Bel Brands USA

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Product and Value Creation

Successful products and services are those that customers perceive as valuable enough to buy.

Courtesy Amazon.com

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Price and Value Capture

Price must allow for customers to perceive good value for the product they receive.

Purestock/SuperStock

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Place and Value Delivery

The product must be readily accessible

Why is this retailer growing?

Courtesy Sephora USA, Inc..

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Promotion and Value Communication

Television Radio Magazines Sales force New Media©Lars A Niki

McGraw-Hill Companies, Inc./Gary He, photographer

The McGraw-Hill Companies, Inc./John Flournoy, photographer

Courtesy Pizza Hut.

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Step 5: Evaluate Performance and Make Adjustments

P&G Website

HIGH Relative market share LOW

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CHECK YOURSELF

1. What are the five steps in creating a marketing plan?

2. What tool helps a marketer conduct a situation analysis?

3. What is STP?

4. What do the four quadrants of the portfolio analysis represent?

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Growth Strategies

Current New

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Market Penetration

Diversification

Product Development

Market Development

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CHECK YOURSELF

1. What are the four growth strategies?

2. What type of strategy is growing the business from existing customers?

3. Which strategy is the riskiest?

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Customer excellence is achieved when a firm develops value-based strategies for retaining loyal customers and provides outstanding customer service.

Glossary

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A diversification strategy introduces a new product or service to a market segment that currently is not served.

Glossary

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Locational excellence occurs by having a good physical location and Internet presence.

Glossary

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A market development strategy employs the existing marketing offering to reach new market segments, whether domestic or international.

Glossary

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A market penetration strategy employs the existing marketing mix and focuses the firm’s efforts on existing customers.

Glossary

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A marketing plan is a written document composed of an analysis of the current marketing situation, opportunities and threats for the firm, marketing objectives and strategy specified in terms of the four P’s, action programs, and projected or pro-forma income (and other financial) statements.

Glossary

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A mission statement is a broad description of a firm’s objectives and the scope of activities it plans to undertake.

Glossary

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Operational excellence is achieved through efficient operations and excellent supply chain and human resource management.

Glossary

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A product development strategy offers a new product or service to a firm’s current target market.

Glossary

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Product excellence occurs by having products with high perceived value and effective branding and positioning.

Glossary

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A situation analysis uses a SWOT analysis that assesses both the internal environment with regard to its Strengths and Weaknesses and the external environment in terms of its Opportunities and Threats.

Glossary

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STP stands for segmentation, targeting, and positioning, and is used to identify and evaluate opportunities for increasing sales and profits.

Glossary

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A sustainable competitive advantage is an advantage over the competition that is not easily copied, and thus can be maintained over a long period of time.

Glossary