Strategic Planning and the Marketing Process

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Strategic Planning and the Marketing Process

• Muhammad Imran Wazir

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Strategic Planning

• The process of developing and maintaining a
  strategic fit between the organizations goals
  and capabilities and its changing marketing
  opportunities.
• It involves defining a clear company mission,
  setting supporting objectives, designing a sound
  business portfolio, and coordinating functional
  strategies.
• If you fail to plan, you are planning to fail.
• The annual and long-range plans deal with the
  companys current businesses and how to keep them
  going.

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Steps in Strategic Planning

• Corporate level Business unit,
  product
• and market levels

Defining the Company mission
Setting company objectives and goals
Designing the business portfolio
Planning marketing and other functional strategies
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What is a Mission?

• Mission statement are enduring statements of
  purpose that distinguish one business from other
  similar firms.
• A clear mission statement acts as an invisible
  hand that guides people in the organization.
• It identifies the scope of a firms operation in
  product and market terms.
• It promotes a sense of shared expectations in
  employees and communicates a public image to
  important stakeholder groups in the companys
  task environment.

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Factors for Mission Statement

• Product and technologies eventually become
  outdated, but basic market needs may last
  forever.
• Management should avoid making its mission too
  narrow or too broad. e.g. pencil manufacturer
  communication equipment business.
• Missions should be realistic, specific and
  motivating. Base on organization distinctive
  competencies and should fit the market
  environment.

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Objectives Vs Goals

• Objectives are the end results of planned
  activity.
• They states what is to be accomplished by when
  and should be quantified if possible.
• The achievement of corporate objectives should
  result in the fulfillment of the corporations
  mission.
• In contrast to objectives, a goal is an
  open-ended statement of what one wishes to
  accomplish with no quantification of what is to
  be achieved and no time frame for completion.

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Designing the Business Portfolio

• Business portfolio the collection of businesses
  and products that make up the company.
• Portfolio analysis a tool by which management
  identifies and evaluates the various businesses
  making up the company.
• SBU a unit of the company that has a separate
  mission and objectives and that can be planned
  independently from other company businesses.
• The company must
• Analyze its current business portfolio and decide
  which businesses should receive more, less, or no
  investment.
• Develop growth strategies for adding new products
  or businesses to the portfolio.

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The Boston Consulting Group Approach

• A portfolio-planning method that evaluate a
  companys SBUs in term of their market growth
  rate and relative market share.
• SBUs are classified as stars, cash cows, question
  marks, or dogs.
• One of the four strategies can be pursued for
  each SBUs.
• Invest more in the SBU in order to build its
  share.
• Invest just enough to hold the SBUs share at its
  current level.
• It can harvest the SBU, milking its short-term
  cash flow regardless of the long-term effect.
• The company can divest the SBU by selling it or
  phasing it out and using the resources elsewhere.

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Developing Growth Strategies

• Existing New
• products products
• Existing
• markets
• New
• markets

Market Penetration
Product Development
Market Development
Diversification
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Planning Cross-Functional Strategies

• The companys strategic plan establishes what
  kinds of businesses the company will be in and
  its objectives for each.
• Then, within each business unit more detailed
  planning must take place.
• There is much overlap between overall company
  strategy and marketing strategy. Marketing looks
  at consumer needs and the companys ability to
  satisfy them these same factors guide the
  companys overall mission and objectives.

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Marketing and the Other Business Functions

• Value chain the series of departments which
  carry out value creating activities to design,
  produce, market, deliver, and support a firms
  products.
• Each company department can be thought of as a
  link in the companys value chain.e.g. Wal-Mart.
• A companys different functions should work in
  harmony to produce value for consumers.
• Marketing department actions can increase
  purchasing costs, disrupt production schedules,
  increase inventories, and create budget
  headaches.
• Jack Welch, former CEO of GE, Companies cant
  give job security. Only customers can!

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Factors Influencing Company Marketing Strategy
Marketing Intermediaries
Demographic-economic environment
Technological-natural environment
Marketing analysis
Product
TARGET CONSUMERS
Marketing planning
Publics
Price
Place
Suppliers
Promotion
Marketing control
Marketing implementation
Social-cultural environment
Political- legal environment
Competitors
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The Marketing Process

• The process of
• Analyzing marketing opportunities
• Selecting target markets
• Developing a marketing mix
• Managing the marketing effort.
• The company first identifies the total market,
  then divides it into small segments, selects the
  most promising segments, and focuses on serving
  and satisfying these segments.
• To find the best marketing mix and put into
  action, the company engages in marketing
  analysis, planning, implementation and control.

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Connecting with Consumers

• Companies know that they cannot connect
  profitably with all consumers in a given market
  at least not all consumers in the same way.
• Thus, each company must divide up the total
  market, choose the best segments, and design
  strategies for profitably serving chosen segments
  better than its competitors do.
• This process involves three steps market
  segmentation, market targeting, and market
  positioning.

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Market Segmentation

• The market consists of many types of consumers,
  products, and needs, and the marketer has to
  determine which segments offer the best
  opportunity for achieving company objectives.
• Consumers can be grouped and served in various
  ways based on geographic, demographic,
  psychographic, and behavioral factors.
• A market segment consists of consumers who
  respond in a similar way to a given set of
  marketing efforts.
• Market segmentation dividing a market into
  distinct groups with distinct needs,
  characteristics, or behavior who might require
  separate products or marketing mixes.

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Market Targeting

• The process of evaluating each market segments
  attractiveness and selecting one or more segments
  to enter.
• A company should target segments in which it can
  profitably generate the greatest customer value
  and sustain it over time.
• Most companies enter a new market by serving a
  single segment, and if this proves successful,
  they add segments.
• GM says that it makes a car for every person,
  purse, and personality.

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Market Positioning

• A products position is the place the product
  occupies relative to competitors in consumers
  minds.
• Market positioning arrangement for a product to
  occupy a clear, distinctive, and desirable place
  relative to competing products from competing
  brands and give them the greatest strategic
  advantage in their target markets.
• Thus, marketers plan positions that distinguish
  their products from competing brands and give
  them the greatest strategic advantage in their
  target markets.
• The company first identifies possible competitive
  advantages on which to build the position.

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The four Ps of Marketing Mix
Product Variety Quality Design Fe
atures Brand name Packaging Services
Price List price Discounts Allowan
ces Payment period Credit terms
Target customers Intended positioning
Place Channels Coverage Assortmen
ts Locations Inventory Transportation Logistics
Promotion Advertising Personal
selling Sales promotion Public relations
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Buyers Viewpoint
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Managing the Marketing Effort
Analysis
Control Measure results Evaluate results Take
corrective action
Planning Develop strategic plan Develop
marketing plan
Implementation Carry out the plans
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Marketing Analysis Planning

• The company must analyze its markets and
  marketing environment to find attractive
  opportunities and to avoid environmental
  threats.
• It must analyze company strengths and weaknesses
  as well as current and possible marketing actions
  to determine which opportunities it can best
  pursue.
• Marketing planning involves deciding on marketing
  strategies that will help the company attain its
  overall strategic objectives.
• A marketing strategy is the marketing logic
  whereby the company hopes to achieve its
  marketing objectives. It consists of specific
  strategies for target markets, positioning, the
  marketing mix, and marketing expenditure levels.

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Marketing Implementation

• A brilliant marketing strategy counts for little
  if the company fails to implement it properly.
• Marketing planning addresses the what and why of
  marketing activities, implementation addresses
  the who, where, when, and how.
• Many managers think that doing things right
  (implementation) is as important as, or even more
  important than, doing the right things
  (strategy).
• Successful implementation depends on how well the
  company blends its people, organizational
  structure, decision and reward systems, and
  company culture into a cohesive action program
  that supports its strategies.

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The Control Process

• Set goals Measure performance
  Evaluate performance Take corrective
  action

What do we want to achieve?
What is happening?
Why is it happening?
What should we do about it?
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Marketing Control

• The process of measuring and evaluating the
  results of marketing strategies and plans, and
  taking corrective action to ensure that
  objectives are achieved.
• Operating control involves checking ongoing
  performance against the annual plan and taking
  corrective action when necessary.
• Strategic control involves looking at whether the
  companys basic strategies are well matched to
  its opportunities.
• The marketing audit is a major tool for strategic
  control. It is a comprehensive, systematic,
  independent, and periodic examination of a
  companys environment, objectives, strategies,
  and activities to determine problem areas and
  opportunities.