Chapter 2

Shah Nidhi S. (TMESIBMCS)

Chapter 2 Developing Marketing Strategies and Plans

Phases of Value Creation and Delivery

1. Choosing the value

2. Providing the value

3. Communicating the value

What is the Value Chain?

The value chain is a tool for identifying ways to create more customer

value because every firm is a synthesis of primary and support

activities performed to design, produce, market, deliver, and support

its product.

The value chain is a tool which is used for identifying ways to create

more customer value. There are 9 strategically relevant activities – 5

primary and 4 supportive.

Core Business Processes

A firm must coordinate all the department activities to conduct its core

business processes, through cross-functional teams

1. Market-sensing process- all the activities in gathering market

intelligence, disseminating it within the organization, and acting on

the information.


2. New-offering realization process- all the activities in researching,

developing, and launching new high quality offerings quickly and

within budget.

3. Customer acquisition process – all the activities in defining target

markets and prospecting for new customers.

4. Customer relationship management process – all the activities in

building deeper understanding, relationships, and offerings to

individual customer.

5. Fulfillment management process – all the activities in receiving and

approving orders, shipping the goods on time, and collecting payment.

Core Competencies

Core Competency refers to areas of special technical and production

expertise, whereas distinctive capability describes excellence in broader

business processes. Market-driven organizations generally excel in three

distinctive capabilities: market sensing, customer linking and channel

bonding.

The marketing plan is the central instrument for directing and coordinating

the marketing effort.

Marketing Plan

A marketing plan is a written document that summarized what the marketer

learned about the marketplace and indicates how the firm plans to reach its

marketing objective.

The marketing plan operates at two levels: strategic and tactical.

The strategic marketing plan lays out the target markets and the value

proposition the firm will offer, based on an analysis of the best market

opportunities.


The tactical marketing plan specifies the marketing tactics, including

product features, promotion, merchandising, pricing, sales channels and

service.

Marketing Plan Contents

1. Executive summary

2. Table of contents

3. Situation analysis

4. Marketing strategy

5. Financial projections

6. Implementation controls

Corporate Headquarters

All corporate headquarters undertake four planning activities

1. Defining the corporate mission

2. Establishing strategic business units

3. Assigning resources to each Strategic Business Unit

4. Assessing growth opportunities

Good Mission Statements

• Focus on a limited number of goals

• Stress major policies and values of the organization

• Define major competitive spheres

• Take a long-term view

• Short, memorable, meaningful

Business Unit Strategic Planning

The Business Unit Strategic Planning process consists of the following steps

1. The Business Mission: Each business unit needs to define its specific

mission within the broader company mission.


2. SWOT Analysis: The overall analysis of a company’s Strengths,

Weaknesses, Opportunities and Threats is called SWOT analysis. It is a way

of monitoring the external and internal marketing environment. To evaluate

opportunities, companies can use Market Opportunity Analysis.

3. Goal Formulation: Developing specific goals for a short term is known as

Goal Formulation. They are specific with respect to magnitude and time.

Goals must be consistent and realistic and could be a mix of various

objectives.

4. Strategy Formulation: Strategy is a game plan for achieving the goals. It

consists of a Marketing Strategy, Technology Strategy and a Sourcing

Strategy.

5. Program Formulation: The unit must plan programs in accordance with

its goals and strategy and thus work upon the various departments, to

strengthen them and integrate all of them together.

6. Implementation: Even a great marketing strategy can be sabotaged by a

poor implementation. It must coordinate its tasks to implement its plan

properly.

These tasks must be in line with the interests of the stakeholders as well.

7. Feedback and Control: The key to organizational health is willingness to

examine the changing environment and adopt new goals and behaviors. In

the rapidly changing market environment, even large organizations which

are subject to inertia can be changed through strong leadership.

Strategic Business Unit

A Strategic Business Unit is a single business (or a collection of similar

businesses) that can be planned separately from the rest of the company.

By identifying the company’s SBUs, it is easy to develop separate

Strategies and assign appropriate funding.

Chapter 2

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