Advanced Marketing PlanningAdvanced Marketing Planningby

Professor Malcolm McDonaldCranfield School of Management

8th November 2000

Definition of marketing

Marketing is a process for:● understanding markets● quantifying the value required by the different groups

(segments) within these markets● communicating this value to those responsible for

delivering it● measuring the effectiveness of the value actually

delivered

AssetBase

Define markets& understand

value

Createvalue

Delivervalue

Monitorvalue

Map of the marketing domain

Define markets& understand

value

Createvalue proposition

Communicate & deliver

value

Monitorvalue

Application areas

Data warehouse

Intranet

CRMInternet

Planningsupport

tools

Definemarkets & segments

Understandvalue required

(by the customers)

Understandcompetitor value

positioning

Evaluatemarket/segmentattractiveness

- Corporate mission/objectives

- External data inc. market research

- Internal data from value delivery

Analysis

Define markets and understand value

*

*

Key elements of world class marketing

1.1. Profound understanding of the market-place

2.2. Creative segmentation and selection

3.3. Powerful differentiation positioning and branding

4.4. Effective marketing planning processes

5.5. Long-term integrated marketing strategies

6.6. Institutionalised creativity and innovation

7.7. Total supply chain management

8.8. Market-driven organisation structures

9.9. Careful recruitment, training and career management

10.10. Vigorous line management implementation

Personalising segments

OIO0599.7

Choose markets/segments

Define objectivesvalue received

Define price/valueproposition

Estimate expected results Value received and budgeting

AnalysisCorporate objectives

Marketing Plan(s)

CostConvenienceCommunicationConsumer wants& needs- product/servicebenefits

PricePlace - distribution Promotion * - marketing communicationsProduct/service - features - customer service

Create the value proposition

Define marketingstrategies

How value is to be delivered /communicated

*

Supplies Products Services

Research &development

Inboundlogistics Operations Outbound

logistics Service

Monitor Mgr. Comm.programsMeasurement:Attitudes- awareness- perceptions- etcBehaviour- conversion rates- etc

Design and implementmarketing communication programs

Across media:• Mass media• Mail• Telephone• Personal contact• Electronic eg Net• etc

Communicate the offer (implement integrated marketing communications plan)

Customer information

Design program Negotiate/tailorInitiate dialogue CommitExchange information Exchange value

Exchange information

Deliver value

Deliver the product / service

modifications to value proposition / marketing strategy

Create valueproposition

New market creation

DefineMarkets

**

Mass media - objectives

- message strategy

- media strategy

Direct mail - objectives

- strategy

Telephone

- objectives

- strategy

Personalcontact

- objectives

- strategy

Electronic- objectives

- strategy

PlaceDistribution

Strategy

e.g test drive,demonstration,5 senses

Integrated marketingcommunications plan

Channel/Medium Choice

Other- PR

- POS

- etc

Define marketing strategy for promotion

Monitor value

Value required(by customers)latest vsexpected

Value received(by us)vs objectives

Value deliveredvs proposition

How value delivered/ communicated vs

marketing strategies

• Product / service vsplan (R&D, Operations)

• Promotions vs plan• (IMCP)• Place vs plan• (Distribution Plan)• Price vs plan

Definemarkets/segments

Evaluatemarket/segmentattractiveness

Choosemarkets/segments

Define objectives

Estimate expectedresults

Valuerequired

Valuedelivered

Valuereceived

How valuedelivered/

communicated

Define markets & understand value

Understand valuerequired

Understandcompetitor value

positioning

Define price/valueproposition

Define marketingstrategies

Createvalueproposition

OutboundlogisticsOperations Service

Design/implement marketing communication programmesDesign program Negotiate/ tailorInitiate dialogue CommitExchange information Exchange value

Monitormarcom

programmes

Deliver product/service

Exchange information

InboundlogisticsR&D

Monitor value

Analysis

MarketingPlan(s)

Customerinformation

PlanEffectiveness

Communicate value

DataWarehouse

CRMSystem

ERP

OperationalEIS

Channelchoice

Allocation of customersto segmentsOperational implications

Program monitoringCustomer interface

Monitor vsPlan

Size/shareRevenue/Profit

RetentionCLV

Purchasepropensity

R&D supportData analysis

Projectmanagement

Planningsupport

toolsMarket mappingSegmentationSWOTCompet. AnalysisPortfolio analysisForecasting

NPDPlanning

Market researchaggregation/

analysis

Causalmodels

ITSupportforMarketing

Deliver value

Key areas for improvements in strategicmarketing planning

General commentsA strategic marketing plan should be a clear and simplesummary of key market trends, key target segments, thevalue required by each of them, how we intend to createsuperior value (to competitors), with a clear prioritisation ofmarketing objectives and strategies, together with thefinancial consequences.

Frequently, they are diffuse, confusing compilations forunconnected individual sections.

Barriers to marketing planning

1.1. Cultural Lack of belief in planning and/ormarketing and/or need to change

2.2. Behavioural Lack of top management support;lack of cross functional involvement

3.3. Cognitive Lack of knowledge and skill

4.4. Systems & Lack of data and/or inappropriateprocedures systems

5.5. Resources Lack of time, people and money

All of these factors are inter-dependent i.e. changeone, it impacts on another

Lack of Knowledge and Skills

Key marketing concepts/tools, linkages.The need for marketing planning

ProductManagement

Brands

Objectives,Strategies,

Programmes,Budgets, Forecasts,

PlansAssumptions

PIMS

GapAnalysis

ProductManagement

MIS

Mktg.Res.

PlaceManagement

AnsoffMatrix

Mktg.Audit

Position

Lifecycle

Mkt.Growth

Mkt.Share

Diffusion

BostonMatrix

PromotionMngmt.

SalesPromotion Channel

mngmt.

CustomerService

PDM

SalesForce

Adv.

MarketingOrganisation

Segmen-tation

Price

The output of the marketing planning process Strategic marketing plan contents

Marketing theory(Structures, frameworks, models)

Mission statementFinancial summary

Issue management

B.C.G. MatrixDirectional policy matrix

McDonald PRODUCTIVITY MATRIXBlake mouton matrixForecastingBudgeting

Measurement and review

Marketing planning and marketing theory (structures, frameworks, models etc.)© Copyright, professor Malcolm h.B. McDonald 1987

Downside risk assessment

Market segmentation studiesMarket researchResponse elasticities

Porter matrixAnsoff matrixBcg matrixDirectional policy matrixGap analysis

Key success factors matrixMarket researchMarket segmentation studies

Market overview

Marketing Strategies

Marketing Objectives

Opportunities Threats

Portfolio summary

Assumptions

Resource Requirements

StrengthsWeaknesses

Issues to beAddressed

Market structureMarket trendsKey market segmentsGap analysis

Marketing auditMarket researchMarket segmentation studiesGap analysisProduct life cycle analysisDiffusion of innovationAnsoff matrixForecastingMarket research

ProductPricePromotionPlace

(4 x 4 ps)(Positioning/branding)

Strategic focusProduct mixProduct developmentProduct deletionMarket extensionTarget customer groups

(By product)(By segment)(Overall)(By product)(By segment)(Overall)(By product)(By segment)(Overall)

(By product)(By segment)(Overall)

The marketingPlanning process

Phase 1

Goal setting

Phase 2 Situation review

Phase 3StrategyFormulation

Phase 4ResourceAllocationAnd monitoring

Cranfield Centre for AdvancedTechnology in Marketing

Objective of Centre

To develop solutions, via information technology,

which make available the power of marketing tools,

techniques and processes, to personnel at all

levels within an organisation, who have an

influence on marketing.

Hierarchical decomposition of thetasks involved in producing a strategicmarketing plan (1)

Definitions

Conduct audit

Predict trends

Set objectives& strategies

Business unit

Mission & targets

Product markets

Financial performance

SWOT analysis

Summarise audit

Financial performance

Update SWOT analysis

Summarise trends

Define marketing objectives

Define marketing strategies

Assess objectives

Produce astrategic

marketingplan

Hierarchical decomposition of the tasks involved inproducing a strategic marketing plan (2)

Conduct audit

Financialperformance

SWOTanalysis

Summariseaudit

Strengths &weaknesses

Opportunities& threats

Marketattractiveness

Aggregatedlife cycle

Gapanalysis

Bostonmatrix

Directionalpolicy matrix

Life cycle

Portermatrix

Perpetualmap

Competitoranalysis

MAF barchart

CSF barchart

Some major technique interrelationshipsused in strategic marketing planning

Bostonmatrix

Directionalpolicy matrix

Product lifecycle

Portermatrix

Perceptualmap

Marketattractiveness

CSF barchart

Costexperiencecurve

AnsoffMatrix

Gapanalysis

Marketsegmentation

New productdevelopment

StrategyFormulation

priorities,portfolio balance

future potential product-marketchoice

riskcategoriesgap

newideas,risk

priorities,portfoliobalance

forecastvolume

cost future data

positioningdifferentiation

axespositioning

horizontalaxis

verticalaxis

Key: provides x as input to