Concepts and Strategies

Strategic Planning

The managerial process of

creating and maintaining a fit

between the organization’s

objectives and resources and

evolving market opportunities.

The goal is long-term

profitability and growth.

StrategicPlanning

StrategicPlanning

Strategic Marketing Management

What is the organization’s main activity?

How will it reach its goals?

THE ANSWER IS A MARKETING PLAN.

Strategic Planning

A written document that acts as a

guidebook of marketing activities

for the marketing manager.

Marketing PlanMarketing Plan

Why Write a Marketing Plan?

Provides a basis for comparison of actual and expected performance

Provides clearly stated activities to work toward common goals

Serves as a reference for the success of future activities

Provides an examination of the marketing environment

Allows entry into the marketplace with awareness

Marketing PlanElements

Marketing Strategy

Product Distribution

Price

Marketing Mix

Business Mission Statement

Objectives

Situation or SWOT Analysis

Target Market Strategy

ImplementationEvaluation

Control

Promotion

The Importance of Strategic Marketing

WhatWhatWhatWhat

WhyWhyWhyWhy

HowHowHowHow

Strategic PlanningStrategic PlanningStrategic PlanningStrategic Planning

Long-term profitability and growthLong-term profitability and growthLong-term profitability and growthLong-term profitability and growth

Write a marketing planWrite a marketing planWrite a marketing planWrite a marketing plan

Defining the Business Mission

Answers the question, “What business are we in?”

Focuses on the consumers & market(s) rather than the good or service

Strategic Business Units (SBUs) may also have a mission statement

AMA’s Mission Statement

Q: What business are we in?

A: Business mission statement

Too narrowToo broadJust right

marketing myopiano directionfocus on marketsserved and benefitscustomers seek

Business Mission Statement

Marketing Objective

A statement of what is to

be accomplished through

marketing activities.

Marketing Objective

Marketing Objectives Realistic

Measurable

Time specific

Consistent with and indicate the organization’s priorities“Our objective is to achieve 10 percent dollar market share in the cat food market within 12

months of product introduction.”

Criteria for Good Marketing Objectives

Realistic, measurable, and time-specific objectives Realistic, measurable, and time-specific objectives consistent with the firm’s objectives:consistent with the firm’s objectives:

1. Communicate marketing management philosophy

2. Provide management direction

3. Motivate employees

4. Force executives to think clearly

5. Allow for better evaluation of results

SWOT Analysis

Identifying

internal strengths (S)

and weaknesses (W)

and also examining

external opportunities (O)

and threats (T)

SWOT AnalysisSWOT Analysis

BASIS OF MARKETING PLAN

SITUATION ANALYSIS

SWOT AnalysisEnvironmental Scanning

SWOT Analysis

©South-Western College Publishing

SSWWOOTT

Things the company does well.Things the company does well.

Things the company does not do well.Things the company does not do well.

Conditions in the external environment that favor strengths.Conditions in the external environment that favor strengths.

Conditions in the external environment that do not relate to existing strengths or favor areas of current weakness.

Conditions in the external environment that do not relate to existing strengths or favor areas of current weakness.

InternalInternal

ExternalExternal

Environmental Scanning

The collection and

interpretation of information

about forces, events, and

relationships in the external

environment that may affect the

future of the organization or the

implementation of the

marketing plan.

EnvironmentalScanning

EnvironmentalScanning

Components of a Situation Analysis

production costs

marketing skills

financial resources

image

technology

Strengths

Weaknesses

INT

ER

NA

LIN

TE

RN

AL

EN

VIR

ON

ME

NT

EN

VIR

ON

ME

NT

COMPETITIVE ADVANTAGE

What are the sources of competitive advantage?

Competitive Advantage

CompetitiveAdvantage

CompetitiveAdvantage

The set of unique features of a

company and its products that

are perceived by the target

market as significant and

superior to the competition.

Competitive Advantage

Niche StrategiesNiche Strategies

CostCost

Product/Service Differentiation

Product/Service Differentiation

Types of Types of Competitive Competitive AdvantageAdvantage

Types of Types of Competitive Competitive AdvantageAdvantage

Cost Competitive Advantage

Cost Competitive Advantage

Cost Competitive Advantage

Being the low-cost

competitor in an industry

while maintaining

satisfactory profit

margins.

Cost Competitive Advantage Obtain inexpensive raw

materials

Create efficient plant operations

Design products for ease of manufacture

Control overhead costs

Avoid marginal customers

Sources of Cost Reduction

Experience CurvesExperience Curves

Efficient LaborEfficient Labor

No-frills ProductsNo-frills Products

Government SubsidiesGovernment Subsidies

Product DesignProduct Design

ReengineeringReengineering

Production InnovationsProduction Innovations

New Service Delivery Methods

New Service Delivery Methods

Product/Service Differentiation

Product/ServiceDifferentiation Competitive Advantage

Product/ServiceDifferentiation Competitive Advantage

The provision of

something that is unique

and valuable to buyers

beyond simply offering a

lower price than the

competition’s.

Examples of Product/Service Differentiation

Brand names

Strong dealer network

Product reliability

Image

Service

Niche Competitive Advantage

Niche Competitive Advantage

Niche Competitive Advantage

The advantage achieved

when a firm seeks to

target and effectively

serve a small segment of

the market.

Niche Competitive Advantage

Used by small companies with limited resources

May be used in a limited geographic market

Product line may be focused on a specific product category

Sources of Sustainable Competitive Advantage

PatentsPatents

CopyrightsCopyrights

LocationsLocations

EquipmentEquipment

TechnologyTechnology

Customer ServiceCustomer Service

PromotionPromotion

Skills and AssetsSkills and Assetsof anof an

OrganizationOrganization

Skills and AssetsSkills and Assetsof anof an

OrganizationOrganization

Sources of Competitive Advantage

Sources ofSources ofCompetitive AdvantageCompetitive Advantage

Sources ofSources ofCompetitive AdvantageCompetitive Advantage

Cost$

Cost$

Product/ServiceDifferentiationA vs. B vs. C

Product/ServiceDifferentiationA vs. B vs. C

NicheStrategies

NicheStrategies

Strategic Directions

What are the alternative marketing strategies?

Strategic AlternativesMarket

Penetration

MarketDevelopment

Product Development

Diversification

Increase market share among existing customers

Attract new customers to existing products

Introduce new products into new markets

Create new products for present markets

Ansoff’s Strategic Opportunity Matrix

Present Product New Product

New Market

MarketPenetration

MarketDevelopment

ProductDevelopment

Diversification

Present Market

Portfolio Matrix

Stars

Cash Cows

ProblemChildren

Dogs

Portfolio Matrix Strategies

Build

Hold

Harvest

Divest

Strategic Alternatives

Identify strategic alternativesIdentify strategic alternatives

Diversification =

Product development = products

Market development = customers

Market penetration = share

new products +new markets

Marketing Strategy

The activities of selecting and

describing one or more target

markets and developing and

maintaining a market mix that

will produce mutually satisfying

exchanges with target markets.

MarketingStrategy

MarketingStrategy

WHAT IS A TARGET MARKET?

Marketing StrategyTarget Market Strategy

Target Market Strategy

Segment the market based on groups with similar characteristics

Analyze the market based on attractiveness of market segments

Select one or more target markets

Target Market Strategy: How To

Appeal to the ENTIRE market with one marketing mix

Appeal to the ENTIRE market with one marketing mix

Concentrate on ONE marketing segment

Concentrate on ONE marketing segment

Appeal to MULTIPLE marketswith multiple marketing mixes

Appeal to MULTIPLE marketswith multiple marketing mixes

Target Market Strategies

Entire Market Multiple Markets Single Market

Target Market Options

MARKETING MIX

What are the elements of the Marketing Mix?

The 4 P’sProduct – Promotion

Price - Place

The Marketing Mix

A unique blend of product,

distribution, promotion, and

pricing strategies designed to

produce mutually satisfying

exchanges with a target market.

Marketing MixMarketing Mix

Marketing Mix: The “Four Ps”

Price

Promotion

Place

Product

Marketing Mix: The “Four Ps”

The starting point of the “4 Ps”

Includes Physical unit Package Warranty Service Brand Image Value

Product

Products can be… Tangible goods Ideas Services

Marketing Mix: The “Four Ps”

Product availability where and when customers want them

All activities from raw materials to finished products

Ensure products arrive in usable condition at designated places when needed

Place

Marketing Mix: The “Four Ps”

Promotion

Online

Role is to bring about exchanges with target markets by: Informing Educating Persuading Reminding

Includes integration of: Personal selling Advertising Sales promotion Public relations

Marketing Mix: The “Four Ps”

Price Price is what a buyer must

give up to obtain a product.

The most flexible of the “4 Ps”-- quickest to change

Competitive weapon

Price x Units Sold = Total Revenue

Elements of the Marketing Mix

Managing the Marketing Planning Process

IMPLEMENTATIONEVALUATION

CONTROL

Following Up on the Marketing Plan

Implementation

Evaluation

Control

Marketing audit is… Comprehensive Systematic Independent Periodic

The Marketing Audit

ComprehensiveSystematic

IndependentPeriodic

Implementation, Evaluation, and Control

Product PlacePromotionPrice

Product PlacePromotionPrice

Met objectives?

Met objectives?

Implementation Evaluation

Audits• comprehensive• systematic• independent• periodic

Audits• comprehensive• systematic• independent• periodic