chapter 1: introduction to marketing planning - california …ecarter2/csub.mktg.490… · ppt...
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Chapter 1: Introduction to Marketing Planning
Presentation © 2005 Marian Burk Wood - all rights reserved
1-1
What is a marketing plan for?What is a marketing plan for?
To summarize marketplace knowledge To show what marketing will accomplish To detail marketing strategies, activities To show how progress will be measured To explain implementation control
Presentation © 2005 Marian Burk Wood - all rights reserved
1-2
Marketing plan contentsMarketing plan contents
1. Executive summary, table of contents 2. Current situation (with SWOT)3. Objectives and issues analysis4. Target market5. Marketing strategy and programs6. Financial plans7. Implementation controls
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1-3
Researching the current situationResearching the current situation
Examine external environment Assess internal capabilities Understand competitors’ strategies Analyze stakeholders’ influence
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1-4
Understanding markets/customersUnderstanding markets/customers
Learn about markets and customers Examine needs, wants, attitudes Research buying behaviors
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1-5
Planning segmentation, targeting, Planning segmentation, targeting, and positioningand positioning
Identify segments, decide which to target
Create competitively distinctive position in the minds of targeted customers
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1-6
Planning direction, objectives, Planning direction, objectives, and marketing supportand marketing support
Determine strategic direction Set objectives Plan customer service support Plan internal marketing support
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1-7
Approaches to growthApproaches to growth
Exhibit source: Adapted from Alan R. Andreasen and Philip Kotler, Strategic Marketing for Non-Profit Organizations, 6e (Upper Saddle River, NJ: Prentice Hall, 2003), 81.
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1-8
Promotionadvertising, selling, sales
promotion
Channellocations,inventory, coverage
Pricingvalue, discount,
rebate, terms
Offeringproduct, service,
brand, benefit
PRIMARYMARKETING
TOOLS
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1-9
Preparing to track progress and Preparing to track progress and control implementationcontrol implementation
Develop sales forecasts Create budgets and schedules Plan to measure performance Diagnose results Adjust activities as needed
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1-10
Guiding principles for marketingGuiding principles for marketing
Expect change Emphasize relationships Involve everyone Seek alliances Be innovative
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1-11
Chapter 2: Analyzing the Current Situation
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2-1
Inside the marketing environmentInside the marketing environment
1. Macroenvironment Broad forces that can affect performance
2. Microenvironment Groups that more directly influence
performance
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2-2
Using environmental scanningUsing environmental scanning
Exhibit source: Marian Burk Wood, Marketing Planning: Principles into Practice (Harlow, Essex, England: Pearson Education, 2004), 40.
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2-3
SWOT analysisSWOT analysis
Strengths
Internal capabilities that can help the organization achieve its objectives
Weaknesses
Internal factors that can prevent the organization from achieving its objectives
Opportunities
External circumstances that may be exploited for higher performance
Threats
External circumstances that might hinder performance
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2-4
Analyzing the internal environmentAnalyzing the internal environment
Mission Resources Offerings Previous results Keys to success, warning signs Business relationships
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2-5
Analyzing the external environmentAnalyzing the external environment
Demographic trends Economic trends Ecological trends Technological trends Political-legal trends Social-cultural trends Competitors
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2-6
Judging strengths & weaknessesJudging strengths & weaknesses
Exhibit source: Mary K. Coulter, Strategic Management in Action (Upper Saddle River, NJ: Prentice Hall, 1998), 141.
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2-7
Sample SWOT: FedExSample SWOT: FedEx
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Strengths
FedEx, Kinko’s brands Air, ground strength Stable workforce
Weaknesses Possible labor actions Slower growth in package volume
Opportunities
New markets (China) Custom/special services More channels (Kinko’s)
Threats
Intense competition Technology Fuel costs
2-8
Chapter 3: Understanding Markets and
Customers
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3-1
Types of marketsTypes of markets
Consumer market • People buying for themselves or their families
Business market• Companies, nonprofits, government agencies,
or institutions buying for organizations
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3-2
Defining the marketDefining the market
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Penetrated market(customers already buying
such an offering)
Target market(customers being targeted)
Qualified available market(customers qualified to buybased on certain criteria)
Available market(customers interested in, with enough income for, and with
access to offering)
Potential market(all customers who may be
interested in an offering)
3-3
Calculating market shareCalculating market share
Units: If all companies sell 10 million units of a type of product and Company A sells 2 million units, its market share is 20%
Dollars: If all sales of a type of product total $100 million and Company A’s sales are $15 million, its market share is 15%
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3-4
Influences on consumer marketsInfluences on consumer markets
1. Cultural considerations Nation or region, subculture, class
2. Social connections Family, friends, colleagues, aspirations
3. Personal factors Lifestyle, motivation, perceptions/attitudes
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3-5
Influences on business marketsInfluences on business markets
1. Organizational connections Role in and influence on buying process,
relations with competing suppliers
2. Organizational considerations Company’s size, industry, share, growth,
competition, buying policies, finances, buying cycle, derived demand
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3-6
Using marketing researchUsing marketing research
Secondary research • Data collected for another purpose• Sources: government, industry groups,
other
Primary research • Data collected for a specific situation• Sources: surveys, ethnography, other
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3-7
Analyzing markets and customersAnalyzing markets and customers
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Understand behavior, needs Check demographics Watch for changes Take customers’ view Look below the surface Plan for research
3-8
Chapter 4: Planning Segmentation, Targeting,
and Positioning
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4-1
Applying market segmentationApplying market segmentation
Group customers according to similar needs, habits, or attitudes that can be addressed through marketing.
Useful if customers in a segment react differently to marketing, vs. customers in other segments.
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4-2
Using segmentation, targeting, and Using segmentation, targeting, and positioningpositioning
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Segmentation• Select the market• Apply segmentation variables • Assess, select segments for targeting
Targeting• Select number, rank segments for entry• Select segment coverage strategy
Positioning• Select attributes for differentiation• Apply positioning through marketing
4-3
Selecting the market to segmentSelecting the market to segment
Define the general market
Eliminate inappropriate markets/segments• Geographically difficult to reach• Insufficient purchasing power• Ethical issues• Environmental problems
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4-4
Variables for consumer market Variables for consumer market segmentationsegmentation
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Demographic
Age, gender, household size, family status, income, race, occupation, religion, class, nationality
Geographic
Location (country, region, state, city, neighborhood, postal code), distance, climate
Psychographic
Lifestyle, activities, interests
Behavioral/Attitudinal
Benefits perceived/expected, loyalty, usage occasion/rate, user status, price sensitivity, product or brand attitude
4-5
Variables for business market Variables for business market segmentationsegmentation
DemographicIndustry; business size/age; ownership
GeographicLocation; distance; climate
Behavioral/attitudinalPurchasing patterns/process; user status; benefits expected; supplier requirements…
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4-6
Assessing segment attractivenessAssessing segment attractiveness
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Fit with • Company resources • Core competencies
Fit with• Market factors• Competitive factors• Economic and technological factors• Business environment factors
Identify• Most promising segments • Order of segment entry
4-7
Coverage strategiesCoverage strategies
Concentrated marketing• Target only one segment
Undifferentiated marketing• Target all segments with same strategy
Differentiated marketing• Use a separate strategy to target each
segment
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4-8
Positioning for competitive Positioning for competitive advantageadvantage
Use meaningful differentiation• Based on what customers value• Conveys the brand’s value
Apply marketing leverage• Positioning drives marketing• Positioning reinforces differentiation
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4-9
Chapter 5: Planning Direction, Objectives, and
Marketing Support
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5-1
Options for marketing plan directionOptions for marketing plan direction
1. Growth
2. Maintenance
3. Retrenchment
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5-2
Growth strategiesGrowth strategies
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Market penetration
Sell more of existing products in existing markets/segments
Market development
Sell existing products in new segments/markets
Product development
Sell new products in existing markets/segments
Diversification
Sell new products in new markets
5-3
Maintenance strategiesMaintenance strategies
Sustain current revenues/share
Wring short-term profits
Prepare for future growth
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5-4
Retrenchment strategiesRetrenchment strategies
Exit markets, drop products
Downsize marketing, limit distribution
Close down in orderly fashion
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5-5
Effective marketing plan objectivesEffective marketing plan objectives
Specific, time-defined, measurable Realistic yet challenging Consistent with mission and goals Appropriate for environment,
opportunities, and threats
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5-6
Types of marketing plan objectivesTypes of marketing plan objectives
Marketing objectives • To manage key relationships/activities
Financial objectives • To attain certain financial results
Societal objectives • To achieve social responsibility results
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5-7
Sample objectivesSample objectives
Marketing• Customer/channel relationships; market
share; brand awareness
Financial• ROI; revenue/profit by product, channel;
break-even by product
Societal • Greener/cleaner operations; charitable
activities; energy conservation
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5-8
Planning marketing supportPlanning marketing support
Customer service • Satisfy customer needs • Reinforce positioning, allocate resources
Internal marketing • Focus employees on customers• Inform and involve employees• Improve employee performance,
satisfaction
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5-9
Shaping the marketing mixShaping the marketing mix
Exhibit source: Adapted from Tim Berry and Doug Wilson, On Target: The Book on Marketing Plans (Eugene, OR: Palo Alto Software, 2001), 107.
Presentation © 2005 Marian Burk Wood - all rights reserved
5-10
Chapter 6: Developing Product and
Brand Strategy
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6-1
What can be marketed as a product?What can be marketed as a product?
Tangible goods Services Places Ideas Organizations People
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6-2
Product and brand strategyProduct and brand strategy
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6-3
Features, benefits, and servicesFeatures, benefits, and services
Features• Enable product to perform its function
Benefits• Need satisfaction that customers want
Related services• Deliver benefits valued by customers
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6-4
Quality and designQuality and design
Quality• How well a product satisfies customers• Basic functionality is a given
Design• Perform properly, repair easily • Be aesthetically pleasing
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6-5
Packaging and labelingPackaging and labeling
Packaging• For convenience and product safety
Labeling• To communicate contents, uses, warnings
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6-6
Product life cycleProduct life cycle
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Introduction Growth
MaturityDecline
6-7
New product development processNew product development process
1. Idea generation 2. Screening of ideas3. Initial concept testing 4. Business analysis5. Prototype design6. Market testing7. Commercialization8. Monitoring reaction
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6-8
Managing productsManaging products
Product line• Products in a line are related • Line extension adds a product
Product mix• Assortment of all lines offered• Brand extension widens mix
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6-9
Branding a productBranding a product
Conveys an identity Differentiates an offer Uses words, designs, or symbols May be legally protected
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6-10
Pyramid of brand equityPyramid of brand equity
Exhibit source: Adapted from Kevin L. Keller, Strategic Brand Management 2e (Upper Saddle River, NJ: Prentice Hall), 76.
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6-11
Chapter 7: Developing Channel and
Logistics Strategy
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7-1
What is the value chain?What is the value chain?
Series of interrelated, value-added functions
Structure of organizations performing these functions
Gets the right product to the right markets at the right time, place, price
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7-2
Major links in the value chainMajor links in the value chain
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7-3
Channel functions to be handledChannel functions to be handled
Match volume, amount, offer to customers’ needs
Share information Contact, negotiate with customers Transport and store products
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7-4
Planning channel levelsPlanning channel levels
More intermediaries = more levels
Zero-level = direct to customer
One-level = one type of intermediary
Each level must add value, get profit
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7-5
Choosing channel membersChoosing channel members
Intensive distribution = many outlets
Selective distribution = fewer outlets
Exclusive distribution = fewest outlets
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7-6
Internal influences on channel Internal influences on channel strategystrategy
Direction, goals, objectives
Resources and core competencies
Marketing activities
Need for control
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7-7
External influences on channel External influences on channel strategystrategy
Customers and markets
Environmental factors
Competitors
Intermediary availability
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7-8
Planning logisticsPlanning logistics
Manage flows through value chain
Make decisions about: • Storage and inventory• Order processing/fulfillment• Transportation
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7-9
Chapter 8: Developing Pricing Strategy
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8-1
Types of pricingTypes of pricing
Fixed pricing• Customers pay the price set by marketer
Dynamic pricing• Prices vary from customer to customer or
situation to situation
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8-2
How customers define valueHow customers define value
The difference between:
total perceived benefits (features, quality, service, performance, etc.)
and total perceived price (purchase price,
repair costs, shipping costs, etc.)
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8-3
How pricing affects demandHow pricing affects demand
Elastic demand • Small price change significantly increases
or decreases the amount demanded
Inelastic demand• Price change does not significantly affect
the amount demanded
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8-4
Planning value-based pricingPlanning value-based pricing
Start with customers’ perceptions of value and price they will pay
Use target costing to allow for profit or other objectives
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8-5
Planning pricing objectivesPlanning pricing objectives
Relate to financial, marketing, societal objectives
Must be consistent with each other and with the mission and direction
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8-6
External influences on pricingExternal influences on pricing
Customers• Perceptions of value, behavior, attitudes
Competitors• Alternatives available to customers
Channel members• Channel profit considerations
Legal, regulatory, ethical concerns• Decision consequences
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8-7
Sample pricing in retail channelSample pricing in retail channel
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8-8
$0$5
$10$15
$20$25
$30$35
$40
Outbound movement in value chainPrice in dollars $20 $24 $36
Producer Wholesaler Retailer
Internal influences on pricingInternal influences on pricing
Break-even• Level at which revenue covers costs
Marketing mix decisions• Appropriate for product life cycle, context
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8-9
Break-even analysisBreak-even analysis
Exhibit source: Tim Berry and Doug Wilson, On Target: The Book on Marketing Plans (Eugene, OR: Palo Alto Software, 2000), 163.
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8-10
Options for adapting pricesOptions for adapting prices
Discounts and allowances
Bundling/unbundling
Product enhancement
Segment pricing
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8-11
Chapter 9: Developing Integrated Marketing
Communication Strategy
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9-1
Applying integrated marketing Applying integrated marketing communication (IMC)communication (IMC)
Coordinate message content/delivery
Ensure consistency of communications
Support the positioning and direction
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9-2
Planning for IMCPlanning for IMC
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Define target
audience
Select IMCtools
Plan research
Setobjectives
and budget
Analyzeissues
9-3
Who will be targetedWho will be targeted?
Exhibit source: Gary Armstrong and Philip Kotler, Marketing: An Introduction 7e (Upper Saddle River, NJ: Prentice Hall, 2005), 405.
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9-4
IMC objectives and budgetIMC objectives and budget
Establish specific IMC objectives• Identify targeted audience(s)• Influence behavior, feelings, or attitudes• Indicate timing
Develop the IMC budget• Part of overall marketing budget• Consider objectives, IMC tools, markets
targeted, competition, potential ROI
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9-5
Issues in IMC planningIssues in IMC planning
Legal/regulatory
Ethical
Cultural
Competitive
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9-6
PersonalSelling
DirectMarketing
PublicRelations
Sales Promotion
Advertising
MAJORIMC
TOOLS
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9-7
Planning advertisingPlanning advertising
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Market scale• Local, regional, national, global
Media choices• Reach vs. frequency; radio, outdoor, print, Internet, TV, direct mail, other
Message content• Rational appeal or emotional appeal; design, wording, format, graphics, sound, other
Target audience characteristics• Demographic, geographic, psychographic, behavioral, media habits
9-8
Planning sales promotionPlanning sales promotion
Audiences• Consumers, channel, salespeople
Objectives• Build awareness, support IMC campaign• Encourage trial/usage/repurchase• Reinforce loyalty, defend against rivals • Encourage speedy response
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9-9
Planning public relationsPlanning public relations
Audiences• Customers/prospects, employees, channel
members, government officials, special interest groups, analysts, other
Objectives• Understand public perceptions• Enhance image, build awareness• Communicate views and information
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9-10
Planning personal sellingPlanning personal selling
One-on-one attention
Apply the sales process• Identify and qualify prospects• Plan presales approach • Make sales contact• Handle objections, close the sale• Follow up after the sale
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9-11
Chapter 10: Planning Performance Management
and Implementation Control
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10-1
Metrics
Schedules
Budgets
Forecasts
TOOLS FORMEASURINGPROGRESS
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10-2
Using forecastsUsing forecasts
Estimate future sales and costs
Consider external and internal factors
Think about best-case, worst-case, most likely scenario
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10-3
Tools for forecastingTools for forecasting
Causal analysis methods • Regression analysis, econometric models
Time series methods• Smoothing, decomposition
Judgmental tools• Delphi method, sales force estimates,
executive opinion
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10-4
Budgeting for marketingBudgeting for marketing
Affordability budgeting
Percentage-of-sales budgeting
Competitive-parity budgeting
Objective-and-task budgeting
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10-5
Scheduling marketing programsScheduling marketing programs
List main tasks and activities
Assign starting/ending dates
Identify who is responsible for each
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10-6
Why use marketing metrics?Why use marketing metrics?
Focus employees on key tasks
Establish performance expectations that can be measured
Allow internal accountability, pride in accomplishments
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10-7
Sample marketing metricsSample marketing metrics
New customer acquisition• Count new customers attracted within a
year, a quarter, a month
Profitability• Measure gross or net margin per product
or brand for given period
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10-8
Applying marketing metricsApplying marketing metrics
Consider expected outcomes
Consider historical results
Consider competitive/industry results
Consider environmental factors
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10-9
Controlling implementationControlling implementation
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Annual plan control
Check progress toward marketing plan and program objectives
Profitability control
Check progress toward profit-related objectives
Productivity control
Check progress toward higher efficiency in marketing activities
Strategic control
Check effectiveness in managing marketing, relationships, ethics, social responsibility
10-10
Preparing contingency plansPreparing contingency plans
Consider significant, unexpected changes and emergencies
Review and update regularly
Apply lessons learned to next plan
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10-11