2

Developing Marketing
Strategies and Plans

Marketing Management, 13th ed

 Chapter Questions

• How does marketing affect customer

value?
• How is strategic planning carried out at
different levels of the organization?
• What does a marketing plan include?

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 Marketing & Customer Value

• Marketing involves satisfying consumers’

needs and wants.
• The task of any business is to deliver
customer value at a profit.

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 The Value Delivery Process

• The traditional view of marketing is that

the firm makes something and then sells
it.
• Will not work in economies where
people face abundant choice.
• New belief: marketing begins with the
planning process.

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 The Value Delivery Process
Value creation and delivery consists of
three parts:
• Choosing the value (segment the
market, define target market, develop
“offering”).
• Providing the value (product features,
prices, and distribution channels).
• Communicating the value (sales force,
advertising, and promotional tools).
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 Three V’s Approach to Marketing
Nirmalya Kumar’s 3 “Vs” approach to marketing:
• Define the value segment (customer needs)
• Define the value proposition
• Define the value network
Frederick Webster views marketing in terms of:
• Value defining process: Market research &company
self analysis
• Value developing processes: Product development
• Value delivering processes: Advertising&
Distribution
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 What is the Value Chain?

The value chain is a tool for identifying

was to create more customer value
because every firm is a
synthesis(consists) of primary and
support activities performed to
design, produce, market, deliver, and
support its product. (Cisco)

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 Corporate Value Chain

Prentice Hall, 2002 Chapter 4

Wheelen/Hunger 8
 Core Business Processes
• Market-sensing process ( Gathering Market
Information)
• New-offering realization process all activities in
researching ,developing, and lunching high quality
products
• Customer acquisition process ( Defining and
choosing customers)
• Customer relationship management process
• Fulfillment management process all activities in
receiving ,orders shipping and collecting money

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 Characteristics of Core Competencies

• A source of competitive advantage

(internal )
• Applications in a wide variety of markets
(skills)
• Difficult to imitate To copy
• E.g: Nike: Shoe design & Merchandising

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 Table 2.1
Becoming a Vigilant
(cautious)Organization
• Can we learn from the past?
• How should the present be evaluated?
• What do we envision for the future?

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 What is Holistic Marketing?

Holistic marketing sees itself as

integrating the value exploration, value
creation, and value delivery activities
with the purpose of building long-term,
mutually satisfying relationships and
co-prosperity among key
stakeholders.

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Figure 2.1 A Holistic Marketing Framework

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 Value Exploration

• Customer’s cognitive space (reflects

existing and latent needs and includes
participation, stability, freedom, and
change).
• Company’s competence space (broad
versus focused scope of business)
• The collaborator resource space
(horizontal and vertical partnerships).

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 Value Creation

• Marketer’s need to:

• Identify new customer benefits from the
customer’s view.
• Utilize core competencies.
• Select and manage business partners
from its collaborative networks.

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 Value Delivery—What Companies
Must Become?
• Proficient at customer relationship management.
• Who the customers are, and respond to
different customer opportunities.
• Internal resource management.
• Integrate major business processes within
a single family.
• Business partnership management.
• Allow the company to handle complex
relationships with its trading partners.

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 What is a Marketing Plan?

A marketing plan is the central

instrument for directing and
coordinating the marketing effort.
It operates at a
strategic and tactical level.

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 Levels of a Marketing Plan

• Strategic • Tactical
• Target marketing • Product features
decisions • Promotion
• Value proposition • Merchandising
• Analysis of • Pricing
marketing • Sales channels
opportunities
• Service

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 Corporate Headquarters’
Planning Activities

• Define the corporate mission

• Establish strategic business units
(SBUs)
• Assign resources to each SBU
• Assess growth opportunities

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 Strategic Vision vs. Mission
• A strategic vision • The mission
concerns a firm’s statement of a firm
future business path - focuses on its present
“where business purpose -
we are going” “who we are and what
• Markets to be pursued we do”
• Future product/market/ • Current product and
customer/technology service offerings
focus • Customer needs being
• Kind of company served
management is • Technological
trying to create and business
capabilities
 Characteristics of a Mission
Statement
• Identifies the boundaries of the current business
and highlights
• Present products and services
• Types of customers served
• Geographic coverage
• Conveys
• Who we are,
• What we do, and
• Why we are here
A well-conceived mission statement distinguishes a company’s
business makeup from that of other profit-seeking enterprises in
language specific enough to give the company its own identify!
 Trader Joe’s Mission Statement

(a unique grocery store chain)

To give our customers the best food and beverage

values that they can find anywhere and to provide
them with the information required for informed
buying decisions. We provide these with a dedication
to the highest quality of customer satisfaction
delivered with a sense of warmth, friendliness, fun,
individual pride, and company spirit.
 Motorola

“The purpose of Motorola is to honorably

serve the needs of the community by providing
products and services of superior quality at a
fair price to our customers; to do this so as to
earn an adequate profit which is required for
the total enterprise to grow; and by doing so,
provide the opportunity for our employees and
shareholders to achieve their personal
objectives.”

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 Good Mission Statements

• Focus on a limited number of goals

• Stress major policies and values
• Define major competitive spheres
• Take a long-term view
• Short, memorable, meaningful

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 Major Competitive Spheres
company will operate
• Industry :one or more
• Products: define the range of products they will
supply
• Competence: identify the level of technology it will
master and leverage
• Market segment: the type of customers
• Vertical channels: the number of channel levels ,
from raw material to final product and distribution
• Geographic: range of regions, countries in which
company operate

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 Table 2.3
Product Orientation vs. Market Orientation
Company Product Market/Needs
Missouri-Pacific We run a railroad We are a people-
Railroad and-goods mover

Xerox We make copying We improve office

equipment productivity

Standard Oil We sell gasoline We supply energy

Columbia Pictures We make movies We entertain

people

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 Dimensions that Define a Business

• Customer groups :Different customers

• Customer needs
• Technology
e.g. Incandescent Lightening system for
television studios

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 Characteristics of SBUs

• It is a single business or collection of

related businesses
• It has its own set of competitors
• It has a leader responsible for strategic
planning and profitability

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 Figure 2.3 The Strategic Planning Gap

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 Ansoff’s Product-Market
Expansion Grid/ starbucks

• Market penetration strategy

• Market development strategy
• Product development strategy
• Diversification strategy

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 Figure 2.4
Ansoff’s Product-Market
Expansion Grid

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 What is Corporate Culture?

Corporate culture is the shared

experiences, stories, beliefs, and norms
that characterize an organization.

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 Figure 2.5 The Business Unit
Strategic Planning Process

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 SWOT Analysis

• Strengths
• Weaknesses
• Opportunities
• Threats

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 Market Opportunity Analysis (MOA)

• Can the benefits involved in the opportunity

be articulated convincingly to a defined target
market?
• Can the target market be located and
reached with cost-effective media and trade
channels?
• Does the company possess or have access
to the critical capabilities and resources
needed to deliver the customer benefits?

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 Market Opportunity Analysis (MOA)
(cont.)
• Can the company deliver the benefits
better than any actual or potential
competitors?
• Will the financial rate of return meet or
exceed the company’s required
threshold for investment?

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 Goal Formulation and MBO

• Unit’s objectives must be hierarchical

• Objectives should be quantitative
• Goals should be realistic
• Objectives must be consistent

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 Figure 2.6 Opportunity Matrix

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 Figure 2.6 Threat Matrix

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 Porter’s Generic Strategies

• Overall cost leadership

• Differentiation
• Focus

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 Categories of Marketing Alliances

• Product or service alliance; licenses

another to produce its products or services
• Promotional alliance; carry promotion to
another commpany
• Logistics alliances
• Pricing collaborations

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 Marketing Plan Contents

 Executive summary
 Table of contents
 Situation analysis
 Marketing strategy
 Financial projections
 Implementation controls

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 Evaluating a Marketing Plan

 Is the plan simple?

 Is the plan specific?
 Is the plan realistic?
 Is the plan complete?

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