chapter 2: elements of marketing strategy and planning part 1: discover marketing management...
TRANSCRIPT
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CHAPTER 2:ELEMENTS OF MARKETING STRATEGY AND PLANNING
Part 1: Discover Marketing ManagementMcGraw-Hill
Education
Copyright © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
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Learning Objectives
Examine the concept of value and the elements and role of the value chain.
Understand the conditions required for successful marketing planning, that marketing planning is focused on the value. proposition, and that marketing planning is a dynamic process.
Identify various types of organizational strategies.
Conduct a situation analysis. Use the framework provided for marketing
planning, along with the content in future chapters, to build a marketing plan.
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Value Is At The Core Of Marketing
Value is a ratio of benefits to costs, as viewed from the eyes of the beholder (the customer).
Form utility
Time utility
Place utility
Ownership utility
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Value Is At The Core Of Marketing
Value proposition is the firm’s communication of the unique value of its products to its customers.
The value message may include the whole bundle of benefits the company promises to deliver – not just the benefits of the product itself.
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Value Is At The Core Of Marketing
A firm’s value proposition must be strong enough to move customers past satisfaction.
Customer Satisfaction
Customer Loyalty
Customer Retention
Customer Switching
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Value Is At The Core Of Marketing
The Value Chain serves as a means for firms to identify ways to create, communicate, and deliver more customer value within a firm.
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Porter’s Value ChainEXHIBIT 2.1
Source: Michael E. Porter, Competitive Advantage (New York: Simon & Schuster, 1985).
SupportActivities
Primary Activities
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Value-Creating Activities
Primary activities
Service
Marketing and Sales
Outbound Logistics
Operations
Inbound Logistics
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Value-Creating Activities
Support activities
Procurement
Technology Development
Human Resource Management
Firm Infrastructure
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Marketing Planning
Marketing planning is the ongoing process of developing and implementing market-driven strategies for an organization. The resulting document
that records the marketing planning process in a useful framework is the marketing plan.
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Marketing Planning Is Both Strategic And Tactical
Marketing (Big M) serves as a core driver of business strategy.
marketing (little m) represents the specific programs and tactics aimed at customers and other stakeholder groups.
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For Effective Marketing Planning
Everyone in an organization must understand and support the concept of customer orientation.
All internal organizational processes and systems must be aligned around the customer.
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Framework for Marketing Planning
Marketing plan is connected to the firm’s business plan
Conduct a situation analysis Perform any needed market research Establish marketing goals and objectives Develop marketing strategies Marketing mix strategies Develop implementation plans
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Connecting the Marketing Plan to the Firm’s Business Plan
Market-driven strategic planning is often used to describe the process at the corporate or strategic business unit (SBU) level of marshaling the various resource and functional areas of the firm toward a central purpose around the customer.
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Elements Of Marketing Planning
Portfolio analysis views SBUs and sometimes even product lines as a series of investments from which it expects maximization of returns. Boston Consulting Group (BCG)
Growth-Share Matrix GE Business Screen
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Boston Consulting Group Growth-Share MatrixEXHIBIT 2.3
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GE Business ScreenEXHIBIT 2.4
“GE Business Screen,” Business Resource Software Online, www.brs-inc.com/pwxcharts.asp?32, accessed May 16, 2008.
High Med LowH
igh
Med
Low
Market Attractiveness
Bu
sin
ess
Posit
ion
Invest/Grow
SelectiveInvestme
nt
Harvest/Divest
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Elements Of Marketing Planning
Marketing planning does not occur in a vacuum A mission statement articulates an
organization’s purpose, or reason for existence.
Most mission statements also include a discussion of what the company would like to become in the future – its strategic vision.
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Elements Of Marketing Planning
Goals eventually become refined into specific, measurable, and (hopefully) attainable objectives for the firm.
Jet Blue’s goal “to fly new planes” may be refined into an objective “to purchase 15 new aircraft over two years”.
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Elements Of Marketing Planning
Organizational Strategies A strategy is a comprehensive plan
stating how the organization will achieve its mission and objectives.
A firm’s generic strategy is its overall directional strategy at the business level.
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Elements Of Marketing Planning
Three primary categories of competitive strategy: 1. Cost Leadership—
Low Cost2. Differentiation3. Focus (or Niche)
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Generic Business Strategies
Generic Business
Strategies
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Competitive Strategy OptionsEXHIBIT 2.7
Source: Michael E. Porter, Competitive Advantage (New York: Simon & Schuster, 1985).
Cost Leadership Differentiation
Cost FocusFocus
Differentiation
Lower Cost Differentiation
Competitive Advantage
Narr
ow
Targ
et
Com
peti
tive S
cop
e
Bro
ad T
arg
et
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Elements Of Marketing Planning
Core competenciesDistinctive competencies Sustainable competitive advantage
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Miles and Snow’s Strategy Types
Strategic Types
Prospectors
Analyzers
Defenders
Reactors
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Situation Analysis 26
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Situation Analysis 27
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Forces Driving Industry CompetitionEXHIBIT 2.9
Source: Michael E. Porter, Competitive Strategy: Techniques for Analyzing Industries and Competitors (Boston: The Free Press, 1980).
Potential entrants(Threat ofmobility)
Supplier(Supplierpower)
Industrycompetitors
(Segment rivalry)
Buyers(Buyerpower)
Substitutes(Threat of
substitutes)
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Situation Analysis 29
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Elements Of Marketing Planning
Summarize the situation analysis into a SWOT analysis: A convenient way to summarize key
findings into a matrix of strengths, weaknesses, opportunities, and threats.
Internal analysis reveals strengths and weaknesses, while external analysis points to potential opportunities and threats.
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SWOT Analysis TemplateEXHIBIT 2.10
Source: J. David Hunger and Thomas H. Wheelen, Essentials of Strategic Management, 4th ed. (Upper Saddle River, NJ: Prentice Hall, 2007).
Strengths (S)
List 5–10 internalstrengths here
Weaknesses (W)
List 5–10 internalweaknesses here
Threats (T)
List 5–10 externalthreats here
INTERNALFACTORS
(IFAS)
EXTERNALFACTORS(EFAS)
S/O Based Strategies
Generate strategies herethat use strengths to takeadvantage of opportunities
W/O Based Strategies
Generate strategies herethat take advantage ofopportunities byovercoming weaknesses
S/T Based Strategies
Generate strategies herethat use strengths toavoid threats
Opportunities (O)
List 5–10 externalopportunities here
W/T Based Strategies
Generate strategies herethat minimize weaknessesand avoid threats
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Elements Of Marketing Planning
Additional Aspects of Marketing Planning Perform Any Needed Market Research
Establish Marketing Goals and ObjectivesGoals are qualitativeObjectives are quantitative
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Elements Of Marketing Planning
Additional Aspects of Marketing Planning Develop Marketing Strategies
Market penetration strategiesProduct development strategiesMarket development strategiesDiversification strategies
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Product – Market CombinationsEXHIBIT 2.11
Source: H. Igor Ansoff, The New Corporate Strategy (New York: John Wiley & Sons, 1988).
Strategy =Market
Penetration
Seek to increasesales of existingproducts toexisting markets
Strategy =Product
Development
Create growthby selling newproducts inexisting markets
Strategy =Market
Development
Introduce existingproducts to newmarkets
Strategy =Diversification
Emphasize bothnew products andnew markets toachieve growth
Existing Products New Products
Product Emphasis
ExistingMarkets
NewMarkets
MarketEmphasis
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Elements Of Marketing Planning
Implementation Plan Forecast
Budget
Appropriate Marketing Metrics
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ELEMENTS OF MARKETING PLANNING
Marketing Control Process of measuring marketing results and
adjusting the marketing plan as needed. Action Plans
Implementation strategy that describes specific tasks and the resources needed, who is responsible, and metrics to track success.
Contingency Plans Plans that can be implemented should
something happen that negates the viability of the marketing plan.
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TIPS FOR SUCCESSFUL MARKETING PLANNING
1. Stay flexible
2. Utilize input, but don’t become paralyzed by information and analysis
3. Don’t underestimate the implementation part of the plan
4. Stay strategic, but also stay on top of the tactical
5. Give yourself and your people room to fail and try again
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Photo Credits
Slide 2-6: Sean Hunter/Getty Images; Steve Hix/Corbis
Slide 2-10: Image Source/Getty Images Slide 2-12: John Lund/Drew Kelly/Blend
Images Slide 2-19: Getty Images Slide 2-21: McGraw Hill Companies (all)
FedEx Image Jill Braaten, photographer A&F image Andrew Resek, photographer Walmart image John Flournoy, photographer
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