Crafting Strategy and the Marketing Plan

1. Crafting Strategyand the Marketing Plan Arild Aspelund

2. Outline • A simple model for marketing strategy • Containing the roles of the key concepts • A practical guide to the marketing strategy process • Kotler’s view • The marketing plan • Rationale • Content • Dissemination and confidentiality

3. Firm Market Strategy Market Resources & Capabilities Segmentation Buying behavior Targeting Value Positioning Marketing Strategy

4. The Value Delivery Process

5. K&K’s Business Unit Strategic Model

6. Business Mission • A good mission statement clearly defines the organization’s mission to all employees, stake holders, customers and suppliers • Defines focus on a common mission! • Focus on a limited number of goals! • Stress major policies and values! • Define major competitive spheres!

7. Mission statement - eBay “We help people trade anything on earth. We will continue to enhance the online trading experiences of all – collectors, dealers, small businesses, unique item seekers, bargain hunters, opportunity sellers, and browsers.”

8. Mission statement - IKEA Does it say that IKEA’s prices should be as low as possible? “The IKEA vision is to create a better everyday life for the many people. We make this possible by offering a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them”

9. SWOT - Analysis Internal Factors • Strengths • Competitive strengths, resources and capabilities • Weaknesses • Competitive disadvantages, resource and capability gaps Three models for internal analysis • The Value Workshop • The Value Chain • The Value Network

10. The Value Work Shop Stabell and Fjeldstad (1998)

11. Porter’s Value Chain

12. The Value Network Stabell and Fjeldstad (1998)

13. SWOT - Analysis External Factors • Opportunities • Attractiveness and success probability • Threats • Seriousness and probability of occurrence • Market research • Customer characteristics, segments, preferences, buying behavior, etc Two models for external analysis • PESTEL - analysis • Porter’s five forces • (We will come back to these shortly)

14. Goal Formulation • Goals should be realistic! • Objectives should be quantitative! • Objectives must be consistent! • Create hierarchical sub-goals!

15. Strategy Formulation • Porter’s generic strategies • Overall cost leadership • Differentiation • Focus • Define overall allocation and development of the firm’s organizational resources and capabilities • Market strategies • Value proposition • Segmentation • Targeting • Positioning • Customer behavior • Define allocation and development of market resources and capabilities

16. Specification of tactical issues Product features Promotion Merchandising Pricing Sales channels Service Development of a feasible time schedule associated with each task Organization and allocation of responsibilities Development of reliable measures of performance on all levels Report procedures Stop criteria Program Formulation, Implementation, Control and Feedback

17. The Market Plan - Motivation • Primarily internal focus • Frequently used in programs for holistic marketing • Communication of market knowledge throughout the organization • A plan…with milestones… • Economic measures, commitment and control

18. The Market Plan - Contents • Executive Summary • Value proposition, key market segments, targeting, positioning, forecasts and returns • Situation Analysis • Market summary with consumer behavior, SWOT, competition, value proposition, CSF • Marketing Strategy • Mission, goals, key market segments, targeting, positioning, marketing mix, marketing research • Financial • Break-even analysis, sales forecast, expense forecast • Controls • Implementation, organization, feed-back routines

19. The Market Plan - Dissemination • It is rarely smart to disclose your market plan • Not only due to competitors can see your evaluation of • Value propositions • Accuracy and amount of market information • Future actions and investments • Cost structure • But also to protect your actions from transparency from customers • It could be wise, however, to publish a version that you want the public and your competitors to see…

20. Summary and continuation • A market strategy should start with a scan of the environment • We have presented a framework for strategical market management that incorporates several frameworks of analysis and forms the basis for new marketing campaignes (these will be revisited in detail…) • We have suggested a structure for a market plan • And in the next episode of Marketing Management… • A model for scanning the environment • A practical guide for performing market research