Strategic Marketing

Strategic Marketing Planning

11/16/2009 Dr. Ranjan Kantha, KBS 2

What is Strategic Planning?

It is the managerial process that helps to develop a strategic and viable fit between the firm’s objectives, skills, resources with the market opportunities available. It helps the firm deliver its targeted profits and growth through its businesses and products.


How to go about it?

Defining the corporate missionEstablishing SBUsAllocating resources for SBUsPlanning for new business


Corporate Mission

This seeks to embody the entire goals of the organization and the objective of its existence.It seeks to provide a sense of purpose, direction and opportunity


5 questions that the firm must ask itself

What is our business?Who is our customer?What does our customer need?What will our business be?What should our business be?


Marketing Myopia

Industry is a customer satisfying process not a goods producing process.It is important therefore how you redefine your business.

Presenter

Presentation Notes

Movies – entertainment Cars – transportation Cosmetics - hope


Good mission statements have three characteristics

They focus on a limited number of goalsIt stresses the major values and policies the firm desiresIt defines the major competitive scope of operation

Presenter

Presentation Notes

Scope – industry, product and applications,competence,market segment,vertical,geographical


Infosys Technologies Limited

“To achieve our objectives in an environment of fairness, honesty, and courtesy towards our clients, employees, vendors, and society at large.”


Biocon

“To be an integrated biotechnology enterprise of global distinction.”


eBay

“We help people trade anything on earth.We will continue to enhance the onlinetrading experiences of all—collectors, dealers, small businesses, unique itemseekers, bargain hunters, opportunitysellers, and browsers.”


Product Orientation vs. Market Orientation

Company Product Market

Xerox We make copying equipment

We improve office productivity

Columbia Pictures

We make movies We entertain people

Encyclopedia Britannica

We sell encyclopedias We distribute information

Carrier We make air conditioners and furnaces

We provide climate control inside homes


SBU

It is a company within a companyThe business is differentiated from the rest of the companyIt has its own set of competitorsIt is a separate profit centre


Concept of Planning

What should be doneWhy is action necessaryWhere shall it be doneHow shall it be doneWho will do itWhat physical resources required


Steps in planning

Establish the objectiveSituation analysis Environmental scanningDetermine alternate course of actionEvaluation of alternativesSelect the best from the alternativesFormulation of planExecution


Steps in the Marketing Planning Process


Marketing Planning


BCG Market Share/Market Growth BCG Market Share/Market Growth MatrixMatrix


The BCG Matrix for ITC Ltd.

StarsHotelsPaperboards/

Packaging.Agri business.

?FMCG- Others

CowsFMCG-Cigarettes

Dogs Maybe ITC Infotech.


PorterPorter’’s Five s Five Forces ModelForces Model


SWOT SWOT AnalysisAnalysis


Ansoff’s Product-Market Grid

Current products New products

Current Mkts

New Mkts

Mkt penetrationstrategy

Mkt developmentstrategy

Product developmentstrategy

Diversificationstrategy


SBU strategies

BuildHoldHarvestDivest


SWOT Analysis

StrengthsWeaknessesOpportunitiesThreats


The GE Model

Business Strength

Mkt

Attr

activ

enes

s

Strong

Medium

Weak

StrongMediumWeak


The Planning Process

Analysing Market opportunitiesDeveloping Marketing strategiesPlanning Marketing ProgramsManaging the Marketing Effort


Porter’s Generic Strategies

Overall cost leadershipProduct DifferentiatorFocus


Marketing Control

Annual Plan controlProfitability controlStrategic Control


Elements of a Marketing Strategy

Blending the four strategy elements of marketing decision-making to satisfy chosen target markets

ProductPriceDistributionPromotion


Target Target MarketMarket

Group of people toward whom the firm decides to direct its marketing efforts


Marketing Mix VariablesMarketing Mix VariablesProduct StrategyProduct Strategy

What goods or services to offerCustomer servicePackage designBrand namesTrademarksWarrantiesProduct Life Cycle PositioningNew-product development


Marketing Mix Variables Marketing Mix Variables Distribution StrategyDistribution StrategyPlanning that ensures that consumers find their products in the proper quantities at the right times and places.

Modes of transportationWarehousingInventory controlOrder processingMarketing channels


Marketing Mix Variables Marketing Mix Variables Promotional StrategyPromotional Strategy

Blending together the various elements of promotion to communicate most effectively with the target marketInforming, persuading, and influencing a consumer’s purchase decision.IMC


Marketing Mix Variables Marketing Mix Variables Pricing StrategyPricing StrategyDeals with the methods of setting profitable and justifiable prices


The Marketing EnvironmentThe Marketing EnvironmentCompetitivePolitical – LegalEconomicTechnologicalSocial – Cultural

Rule of three


Methods for Marketing Planning

Business Portfolio AnalysisBusiness Portfolio AnalysisStrategic Business UnitsStrategic Business Units (SBUs) are key business units within diversified firms

A division, product line, or single product may define an SBUFirms redesign their SBUs as market conditions dictate


The BCG MatrixThe BCG MatrixMarket Share/ Market Growth MatrixMarket Share/ Market Growth Matrix: a marketing planning tool that classifies a firm’s SBU’s or products according to industry growth rates and market shares relative to competing products

StarsCash CowsDogsQuestion Marks


The Strategic Context


The Strategic Context FrameworkThe Vision - a statement about what an organization wants to become. It should give shape and direction to an organization’s future.

The Mission - a broad statement of intention, which sets out an organisation’s purpose and direction, what it wishes to achieve in the long term.

Organisational values - define the acceptable interpersonal and operating standards of behaviour. They govern and guide the behaviour of individuals within the organisation.

Organisational Goals - the desired outcomes of the organisation’s various activities. These may be articulated in terms of profit, market share, share value, return on investment or numbers of customers served.

Corporate Strategy - the means by which the resources of the organisation are matched with the needs of the environment in which the organisation decides to operate.


Three Key Activities of Marketing Strategy Development


Strategic Market Analysis• External Environment - Pestle, Environmental Scanning

• Performance Environment - 5 Forces, Competitor and Supplier Analysis

• Internal Environment - resource analysis

The task is to assimilate the information derived from the analysis of the environment, and to bring it together in a form that can be easily understood. To do this two main

tools can be used:

Scenario Planning

SWOT


Strategic Market Analysis

Scenario Planning –an attempt to understand how trends might influence the future of an organisation and how managers can gain a better understanding of some of the uncertainties an organisation faces if it pursues particular strategies.

SWOT –A series of checklists derived from the marketing audit and the PESTLE analysis, presented as the internal strengths and weaknesses, and the external opportunities or threats.


Strategic Marketing Goals


Strategic Marketing Growth Goals

• Intensive growth - refers to concentrating activities on markets and/or products that are familiar. By increasing market share or by introducing new products to an established market growth, growth is achieved by intensifying activities.

• Integrative growth - occurs where an organisation continues to work with the same products and same markets but starts to perform some of the activities in the value chain that were previously undertaken by others.

• Diversification - refers to developments outside the current chain of value adding activities. This type of growth brings new value chain a activities because the firm is operating with new products and in new markets.


Strategic Market Action


Five Areas of Strategic Market Action

Competitive - is achieved when an organisation has an edge over advantage its competitors when attracting buyers. It has a

superior value proposition.

Generic - there are three generic strategies; overall cost strategies leadership, differentiation and focus strategies, used

in order to develop an advantage.

Competitive - Four main positions can be identified; market leader, positioning challenger, follower and nicher

Strategic - Strategic Competition & Warfare, Strategic Cooperation intent & Relationships

Marketing – organising and implementing the strategic action. planning


Marketing Planning

Marketing planning is a sequential process involving a series of activities

leading to the setting of marketing objectives and the formulation of plans for

achieving them.

(McDonald, 2002 : 27).


Summary• Described the strategic planning process.

• Explained the key influences that impact on marketing

strategy.

• Explained how understanding competitors can assist the

development of marketing strategy.

• Explained the principles of Porter’s generic strategies.

• Explained how scenario planning and SWOT analysis

can help strategic marketing decision-making.

• Outlined the key elements within a marketing plan

Strategic Marketing

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Transcript of Strategic Marketing