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Principles of Marketing GROUP 2
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Strategic Planning and the Marketing
Principles of Marketing GROUP 2
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Strategic Planning and the Marketing
Objectives What is strategic marketing planning? Scope and importance of strategic planning Corporate and division strategic planning Business unit strategic planning The marketing process Implementation and control
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Introduction Introd uction to Strategic Marketing
BY MR. JUNAID YUSUF
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Strategic Planning
Strategic Planning is the Process of Developing and Maintaining a Strategic Fit Between the Organization’s Goals and Capabilities and Its Changing Marketing Opportunities.
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Strategic planning in market involves Where should be the company be in the next 5 to 10 years? Why do we exist? What are the goals of org? Which are the market it should serve? What are the products it should offer? Should there any product live or brand extension? What resources do we need for successful future? Who will be our customers?
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Marketing Strategy
“Marketing Strategy is a series of integrated actions leading to a sustainable competitive advantage.” John Scully
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Understanding Corporate Level
BY MISS. SABBA ABBAS
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Organizational Marketing Levels Hofer and Schendel suggested that organizations develop strategies at three structural levels: Corporate level—(corporate marketing) SBU level—(Strategic Marketing) Product/Market level—(Functional Marketing)
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Corporate and Division Strategic Planning A Mission Statement is a Statement of the Organization’s Purpose.
Market Market Oriented Oriented Realistic Realistic Specific Fit FitMarket MarketEnvironment Environment Distinctive DistinctiveCompetencies Competencies 10
Motivating Motivating
Good Mission Statements: Limited number of goals Stress major policies & values Define competitive scopes
Setting Corporate Objectives and Goals
Designing the Business Portfolio
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The business portfolio is the collection of businesses and products that make up the company. The company must: analyze its current business portfolio or Strategic Business Units (SBU’s) decide which SBU’s should receive more, less, or no investment develop growth strategies for adding new products or businesses to the portfolio
What is a Strategic Business Unit? (SBU) An SBU has three characteristics: It is single business, or a collection of related businesses, that can be planned separately. It has its own set of competitors. It has a manager responsible for strategic planning and profit performance, who controls most of the factors affecting profit. 14
Analyzing the Current Business Portfolio
Analyzing Current SBU’s: Boston Consulting Group Approach Relative Market Share
h t
w o r
G t
e k r a M 16
e t a R
h gi H
High Stars
Low Question Marks
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• High growth & share • High growth, low share • Profit potential • Build into Stars or phase out • May need heavy • Require cash to hold investment to grow market share
Cash Cows • Low growth, high share w • Established, successful o L SBU’s •Produce cash
Competitive- Position Portfolio Classification S S E N E VI T C A R T T A T E K R A M
Strong 5.00 5.00
h gi H
BUSINESS STRENGTH Medium 3.67
2.33
Weak
1.00
3.67
m ui d e M 2.33
2.33
w o L 1.00 Invest/grow
Selectivity/earnings
Harvest/divest
Problems With Matrix Approaches Can be Difficult, Time-Consuming, & Costly to Implement
Difficult to Define SBU’s & Measure Market Share/ Growth
Focus on Current Businesses, But Not future Planning
Can Lead to Unwise Expansion or Diversification 18
Assessing Growth Opportunities
BY MR. FARHAN MALIK
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The Strategic-Planning Gap
Diversification growth Integrative growth Intensive growth
Strategicplanning gap
Developing Growth Strategies Product/ Market Expansion Grid Existing Products Existing Markets
1. Market Penetration
New Markets
2. Market Development
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New Products 3. Product Development 4. Diversification
Product/ Market Expansion Grid
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Market Penetration: making more sales to current customers without changing its products. How? Add new stores in current market areas, improve advertising, prices, service or store design. Market Development: develop new markets for its current products. How? Identify new demographic or geographic markets.
Product/ Market Expansion Grid
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Product Development: offering modified or new products to current markets. How? New styles, flavors, colors, or modified products. Diversification: new products for new markets. How? Start up or buy new businesses.
Business Unit Strategic Planning
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Historical review and situation analysis Purpose: To develop a marketing strategy an organization requires information on its past and present position. External environment Market Customer Competitors Company 25
SWOT Analysis
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Opportunity Matrix
Opportunities
Company develops a more powerful lighting system 2. Company develops a device for measuring the energy efficiency of any lighting system 3. Company develops a device for measuring illumination level 4. Company develops a software program to teach lighting fundamentals to TV studio personnel 1.
Success Probability s s e n High e vi t c ar tt A
Low
High
Low
1
2
3
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Threat Matrix Probability of Occurrence High s s e High n s u oi r e S
Low
1
Low
2
Threats
1 Competitor develops a superior lighting system 2.Major prolonged economic depression 3.Higher costs
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4.Legislation to reduce number of TV studio licenses
Marketing Strategy and the Marketing Mix
BY MISS. IRSA JAVED AKHTER
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Competitive Advantage Basically, strategy is about two things: deciding where you want your business to go, and deciding how to get there. A more complete definition is based on competitive advantage, the object of most corporate strategy. Competitive advantage is a company’s ability to perform in one or more ways that competitors cannot or will not match.”
Philip Kotler
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Company Marketing Marketing
Strategy
intermediaries
Demographic/ economic environment
Suppliers
Political/ legal environment
g n i t s i s e k l y a r n a M a
Product
Place
M a C r k o n e t n t r o i g l
M p l a r k a n e t n i i n g n g
Price Target customers
n o g i n a t i t Promotion e n t k a r m e M l e p m i Competitors
Technical/ physical environment
Publics
Social/ cultural environment
Customer Driven Marketing Strategy Market Segmentation: determining distinct groups of buyers (segments) with different needs, characteristics, or behavior. Market Targeting: evaluating each segment’s attractiveness and selecting one or more segments to enter. Market Positioning: arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers.
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The Role of Market Segmentation
Market Segmentation
Division of the total market into smaller, relatively homogeneous groups No single marketing mix can satisfy everyone. Therefore, separate marketing mixes should be used for different market segments.
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No Market Segmentation
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Segmented by Sex
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Segmented by Age
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Selecting a Target Market Before a marketing mix strategy can be implemented, the marketer must identify, evaluate, and select a target market. Market: people or institutions with sufficient purchasing power, authority, and willingness to buy Target market: specific segment of consumers most likely to purchase a particular product
Positioning Positioning: a marketing strategy that emphasizes serving a specific market segment by achieving a certain position in buyers’ minds Attributes Price/quality Competitors Application Product user Product class
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eve op ng Mix
e
ar e ng Price
Product “Goods-and-service” combination that a company offers a target market
Amount of mone that consumers have to pay to Obtain the produ
Target Customers
Activities that persuade target customers to buy the product 40
Promotion
Intended Positioning Company activities that make the product available
Place
The Marketing Process
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Analy zing marketing Analyzing op portunities opportunities The strategic planning and business portfolio analysis processes help to identify and evaluate marketing opportunities. The purpose of the marketing process is to help the firm plan how to capitalize on these opportunities.
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Selecting target markets The segmentation process divides the total market into market segments. Target marketing determines which segment(s) are pursued. The market positioning for the product is then determined.
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Developing the marketing mix Competitor analysis guides competitive marketing strategy development. Strategy leads to tactics by way of the marketing mix: The “Four Ps” – product, price, place, promotion (seller viewpoint) The “Four Cs” – customer solution, cost, convenience, and communication (customer viewpoint)
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Managing the marketing effort Marketing analysis Provides information helpful in planning, implementation, and control Marketing planning Strategies and tactics Marketing implementation Turns plans into action Marketing control Operating control Strategic control Marketing audit
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The Marketing Plan Executive Summary & Table of Contents Current Marketing Situation Threat & Opportunity Analysis Objectives & Issues Marketing Strategy Action Programs Budgets Controls
Strategic-Planning, Implementation, and Control Process Planning Corporate planning Division planning
Implementation
Control Measuring results Diagnosing results
Business planning Product planning
Taking corrective action
Marketing Implementation Marketing Strategy Decision and Organizational Reward Human Structure Resources Action Climate and Programs Culture
Implementation
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Marketing Performance
Marketing Control Process
Set Goals
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Measure Performanc e
Evaluate Performanc e
Take Corrective Action
