Chapter 2: Planning Marketing Strategies

1. Chapter 2:Planning Marketing Strategies Pride/Ferrell Foundations of Marketing Fourth Edition Prepared by Milton Pressley University of New Orleans

2. Objectives • Describe the strategic planning process. • Explain how organizational resources and opportunities affect the planning process. • Understand the role of the mission statement in strategic planning. • Examine corporate, business-unit, and marketing strategies. • Understand the process of creating the marketing plan. • Describe the marketing implementation process and the major approaches to marketing implementation.

3. The Strategic Planning Process • The process of establishing an organizational mission and formulating goals, corporate strategy, marketing objectives, marketing strategy, and a marketing plan

4. Understanding the Strategic Planning Process

5. Marketing Strategy • A plan of action for identifying and analyzing a target market and developing a marketing mix to meet the needs of that market. The Marketing Strategy Wendy’s targets the “late night” market by keeping some of its locations open until midnight and beyond

6. Effective Marketing Strategy • Reflects overall direction of organization • Coordinated with firm’s functional areas • Contributes to achievement of: • Marketing objectives • Organizational goals

7. Discussion Question • Using a local firm or organization, discuss what you perceive to be its “marketing strategy” and its “marketing plan.” • What, if any, changes would you recommend to the firm or organization regarding its marketing strategy or plan?

8. Assessing Organizational Resources and Opportunities Core Competencies Competitive Advantage Strategic Windows Market Opportunities The place where opportunities, core competencies, and strategic windows meet.

9. Core Competencies • Things a firm does extremely well, which sometimes give it an advantage over its competition • McDonald’s consistent delivery of fast food • Starbuck’s gourmet coffee drinks • BMW’s production of sporty, luxury automobiles

10. Marketing Plan A written document that specifies the activities to be performed to implement and control an organization’s marketing activities • Strengths • Weaknesses • Opportunities • Threats

11. Market Opportunity • A combination of circumstances and timing that permits an organization to take action to reach a particular target market. • Real estate is all about Market Opportunity • Explore www.realtor.com

12. Strategic Window • Temporary periods of optimal fit between the key requirements of a market and the particular capabilities of a firm competing in the market.

13. Competitive Advantage • The result of a company’s matching a core competency (superior skill or resources) to opportunities in the marketplace • cheaper, more widely available, stronger service support, higher quality

14. The Four-Cell SWOT Matrix

15. Mission Statement Marketing Goals and Objectives Organizational Goals and Objectives Establishing an Organizational Mission and Goals

16. Mission Statement • Mission Statement Answers: • Who are our customers? • What is our core competency? • Corporate Identity • Unique Symbols • Personalities • Philosophies • Celestial Seasonings complete mission statement

17. Establishing an OrganizationalMission and Goals • Mission Statement @

18. Discussion Question • After reviewing the mission statements for FedEx on the previous slide and the USPS (below), which do you think is the better statement? Why? Source: http://www.usps.com/postalhistory/_pdf/MissionandMotto.pdf#search='postal service. Accessed Sept. 13, 2009)

19. Marketing Objective • A statement of what is to be accomplished through marketing activities to match strengths to opportunities, or to provide for the conversion of weaknesses to strengths • Should be stated in clear, simple terms • Should be accurately measurable • Should specify a time frame for accomplishment • Should be consistent with business-unit and corporate strategy

20. Corporate and Business Unit Strategies Developing Corporate, Business Unit, and Marketing Strategies

21. Fig. 2.4 Levels of Strategic Planning

22. Corporate Strategy • A strategy that determines the means for utilizing resources in the various functional areas to reach the organization’s goals. Corporate Strategy Boeing continues to excel in producing innovative new jetliners such as the Dream Liner

23. Business-Unit Strategy • Strategic Business Units (SBU) • A division, product line, or other profit center within a parent company • Market • a group of individuals and/or organizations that have needs for products and the ability, willingness and authority to buy • Market Share • the percentage of a market that actually buys a specific product from a specific company

24. Market-growth/market-share matrix

25. BCG Product Classifications • Stars • dominant market share & good growth prospect • Cash Cows • dominant market share & low growth prospect • Dogs • low market share & low growth prospect • Question Marks • small market share of a growing market & require significant cash to build market

26. Marketing Strategy Target Market Selection Creating a Marketing Mix Marketing Strategy

27. Target Market Selection Selecting an appropriate target market may be the most important decision a company has to make. Target Market Selection L.L. Bean targets the outdoor enthusiast with many of its products

28. Discussion Question • Click on the Television below, watch the commercial, and discuss your perception of REI’s target market.

29. Marketing Strategy • Components of marketing strategy • Target Market Selection • Creating the Marketing Mix • Sustainable Competitive Advantage • an advantage not readily copied by competitors • Wal-Mart’s buying power as the world’s largest retailer

30. Creating the Marketing Mix • All marketing mix decisions should be consistent with the business unit and corporate strategies. Creating the Marketing Mix Tropicana’s marketing mix is designed to satisfy the needs of health-conscious customers

31. Creating the Marketing Plan • Marketing Planning • The process of assessing opportunities and resources, determining objectives, defining strategies, and establishing guidelines for implementation and control of the marketing program

32. Table 2.1 Components of the Marketing Plan

33. Marketing Implementation Intended Strategy Realized Strategy Marketing Implementation

34. Implementing Marketing Strategies • The process of putting marketing strategies into action • Intended Strategy • Realized Strategy IntendedStrategy Implementation RealizedStrategy

35. Approaches to Marketing Implementation • Customers • External customers • Internal customers • Internal Marketing • External Customers • Internal Customers • Total Quality Management • Benchmarking • Empowerment

36. ImplementingMarketing Strategy Internal Marketing Customer Relationship Management Total Quality Management Approaches to Marketing Implementation

37. Discussion Question What, if any, relationship do you see between the “marketing concept” and “total quality management”?

38. Organizing Marketing Activities Organizing by Functions Organizing by Regions Organizing by Products Organizing by Types of Customers Marketing Activities

39. The Control Marketing Process

40. After Reviewing This Chapter You Should: • Be able to describe the strategic planning process. • Know how organizational resources and opportunities affect the planning process. • Understand the role of the mission statement in strategic planning. • Be able to examine corporate, business-unit, and marketing strategies. • Understand the process of creating the marketing plan. • Be able to describe the marketing implementation process and the major approaches to marketing implementation.

41. Key Concepts • Strategic planning • Marketing strategy • Marketing plan • Core competencies • Market opportunity • Strategic windows • Competitive advantage • SWOT analysis • Mission statement • Marketing objective • Corporate strategy • Strategic business unit (SBU) • Market • Market share • Market growth/market share matrix • Sustainable competitive advantage • Marketing planning • Marketing implementation • Intended strategy • Realized strategy • External customers • Internal customers • Internal marketing • Total quality management (TQM) • Benchmarking • Empowerment • Centralized organization • Decentralized organization • Marketing control process • Performance standard