FO O D &

B E V E R A G E
M A R K E T I N
G
K3
CULN 1421 – WEE
 Review...
Last week we explored the marketing process by which companies (big or small)
create value for customers in order to capture value from them in return. This
week we dig deeper into the steps two and three of the process, designing
customer-driven marketing strategies and constructing marketing programs.
First we look at the organizations overall strategic planning, which guides
marketing strategy and planning, next we see how marketers partner closely
with others, inside and outside the firm to create value for customer, then how
marketers choose target markets, position there market offerings and develop a
marketing mix and manage their marketing programs. Finally we look at the
important step of measuring and managing return on marketing investment
(marketing ROI)
 This week...
• Explain company-wide strategic planning and its four steps
• Discuss how to design business portfolios and develop growth strategies
• Explain marketing’s role in strategic planning and how marketing works with
partners
• Describe the elements of a customer driven marketing strategy
• List the marketing management functions
COMPANY &
MARKETING
STRATEGY:
PARTNERING TO
BUILD CUSTOMER
RELATIONSHIPS
| COMPANY-WIDE STRATEGIC PLANNING: DEFINING
MARKETING’S ROLE
DEFINING MOMENT

Strategic Planning: the process of developing and maintaining a strategic fit between
the organization’s goals and capabilities and its changing marketing opportunities

Companies will prepare:

● Annual Plans & Long-range plans - deal with the company’s current
business and how to keep it going
● Annual plans & Long-range plans look at marketing research, make and make
projection so the company can long range business decisions.
● Strategic plans - involves adapting the company to take advantage of
opportunities in the ever-changing environment
● When creating strategic plans, we ask “how can we change our marketing
strategy to keep up with the competitors
| COMPANY-WIDE STRATEGIC PLANNING: DEFINING
MARKETING’S ROLE
Lines of business.
Could be multiple
products,
multiple departments or
small business’s in a
corporation

Goals are what

companies set to achieve
in there marketing
strategy. Objectives are
the steps that a company
takes to reach their goals.
| COMPANY-WIDE STRATEGIC PLANNING: DEFINING
MARKETING’S ROLE
MARKET-ORIENTED MISSION
DEFINING MOMENT

Mission Statement: a statement of the organization’s purpose - what it wants to

accomplish in the larger environment

Statements should be market oriented and defined in terms of satisfying basic

customer needs - not in product or technology terms.

They should be meaningful, specific and motivating at the same time. Company’s
strengths in the marketplace should be highlighted.

They should not be stated as making more sales or profits.

https://www.youtube.com/watch?v=1xs4I349cdc
| COMPANY-WIDE STRATEGIC PLANNING: DEFINING
MARKETING’S ROLE
MARKET-ORIENTED MISSION

Indigo “To inspire customers and those they care about with life-enriching products
and experiences”

Buffalo Wild Wings “ fuels the sports fan experience”

Under Armour “To make all athletes better through passion, design, and the
relentless pursuit of innovation.”

Facebook “To give people the power to build community and bring the world closer
together”
 | COMPANY-WIDE STRATEGIC PLANNING:
DEFINING MARKETING’S ROLE
SETTING COMPANY OBJECTIVES AND GOALS
The mission statement leads to a hierarchy of objectives, including business
objectives and marketing objectives.
Remember Objectives are the steps to take to reach the goals.
Tim Hortons Mission Statement – “to deliver superior quality products and
services for our guests and communities through leadership, innovation, and
partnerships”

The objectives Tim Horton's set to achieve their goals are -

● Establish a leadership position in sustainability that reflects our commitment to doing the
right thing
● Understand stakeholder perspectives on any given issue and consider views in decision-
making
● Minimize the potentially negative impacts of our operations
● Create positive change that benefits individuals, communities, the planet and our
business
| COMPANY-WIDE STRATEGIC PLANNING:
DESIGNING THE BUSINESS PORTFOLIO
DEFINING MOMENT

Business Portfolio: the collection of businesses and products that make up the
company

Whether the company’s business portfolio consists of only one or two operations or
dozens, the strategic planning process is the same:
● The company must analyze its current business portfolio and determine which
businesses should receive more, less, or no investment
● It must shape the future portfolio by developing strategies for growth and
downsizing

The McEwan Group - www.mcewangroup.ca

Take a look at the McEwan Group website, ask yourself what does this company
offer, how many different portfolio’s are in this company and which ones are they
focused on.
| COMPANY-WIDE STRATEGIC PLANNING:
ANALYZING THE CURRENT BUSINESS PORTFOLIO
DEFINING MOMENT

Portfolio Analysis: the process by which management evaluates the products and
businesses that make up the company

In a restaurant management would evaluate menus (lunch, dinner, takeout,

beverage, dessert) suppliers, promotions, employees, consumers, trends)

Strategic Business Units (SBU) : can be a company division, or a single product or

brand
● The company must identify the SBUs
● Then it must assess its various SBUs and decide which ones to support based
on their attractiveness, and their strengths – could be as simple as assessing
individual menu items and asking which ones to keep and which ones to scrap
etc….
| COMPANY-WIDE STRATEGIC PLANNING:
ANALYZING THE CURRENT BUSINESS PORTFOLIO

DEFINING MOMENT

Growth-share Matrix: a portfolio-

planning method that evaluates a
company’s strategic business
units in terms of its market
growth rate and relative market
share
| COMPANY-WIDE STRATEGIC PLANNING:
ANALYZING THE CURRENT BUSINESS PORTFOLIO
DEFINING MOMENT

Stars: high-growth, high-share businesses or products. They often need a lot of

investment in order to finance their rapid growth. Eventually their growth will slow
down and they will become cash cows.

Cash Cows: low-growth, high-share business or products. These are established SBUs
that need less investment to hold their market share.

Question Marks: low-share business units in high-growth markets. They require a lot
of cash to hold their share.

Dogs: low-growth, low-share businesses and products. They may generate enough
cash to maintain themselves but do not promise large sources of cash.
 | COMPANY-WIDE STRATEGIC PLANNING:
ANALYZING THE CURRENT BUSINESS PORTFOLIO
DEVELOPING STRATEGIES FOR GROWTH AND
DOWNSIZING
DEFINING MOMENT

Product-market Expansion Grid: a portfolio-planning tool for identifying company

growth opportunities through market penetration, market development, product
development, or diversification
 | COMPANY-WIDE STRATEGIC PLANNING:
ANALYZING THE CURRENT BUSINESS PORTFOLIO
DEVELOPING STRATEGIES FOR GROWTH AND
DOWNSIZING
DEFINING MOMENT

Market Penetration: a strategy for company growth by increasing sales of current products
to current market segments without changing the product

Market Development: a strategy for company growth by identifying and developing new
market segments for current company products

Product Development: a strategy for company growth by offering modified or new products
to current market segments

Diversification: a strategy for company growth through starting up or acquiring businesses

outside the company’s current products and markets

Downsizing: reducing the business portfolio by eliminating products or business units that
are not profitable or that no longer fit the company’s overall strategy (Not on the grid but
must be considered)
| COMPANY-WIDE STRATEGIC PLANNING:
PLANNING MARKETING
A strategic plan outlines what kinds of businesses a company will operate, as well as
objectives for each. Marketing plays a key role in the company’s strategic planning in
several ways:
● Marketing provides a guiding philosophy - the marketing concept
● Marketing provides inputs to strategic planners
● Marketing designs strategies for reaching the unit’s objectives

Marketers must work closely with partners in other company departments to form value
chains.

Value Chain: the series of internal departments that carry out value-creating activities to
design, produce, market, deliver, and support a firm’s products

Success depends on how well each department performs its work of adding customer value
and on how well the activities of various departments are coordinated. Marketers must find
a way to get all departments to “think customer” and to develop a smoothly functioning
value chain.
| COMPANY-WIDE STRATEGIC PLANNING:
PLANNING MARKETING
Marketers must also partner effectively with other companies in the marketing system to
form a competitively superior external value delivery network.

Value Delivery Network: the network made up of the company, suppliers, distributors, and,
ultimately, customers who partner with each other to improve the performance of the entire
system

McDonald’s
- Their finely tuned value delivery system delivers a high standard of quality,
service, cleanliness and value
- They are only effective if they successfully partner with franchisees,
suppliers, and others to maintain these standards
| MARKETING STRATEGY AND THE MARKETING
MIX

DEFINING MOMENT
Marketing Strategy: the marketing logic by which the company hopes to create customer
value and achieve profitable customer relationships

To create a marketing strategy, the company must first decide which customers it
will serve (through segmentation and targeting) and how (through differentiation
and positioning). To do this, companies will identify the most promising
segments, then focus on serving and satisfying the customers from those
segments.
| MARKETING STRATEGY AND THE MARKETING
MIX
CUSTOMER-DRIVEN MARKETING STRATEGY
DEFINING MOMENT
Market Segmentation: dividing a market into distinct groups of buyers who have different
needs, characteristics, or behaviours and who might require separate products or marketing
programs

Market Segment: a group of customers who respond in a similar way to a given

set of marketing efforts

Market Targeting: the process of evaluating each market segment’s attractiveness and
selecting one or more segments to enter

Positioning: arranging for a product to occupy a clear, distinctive, and desirable

place relative to competing products in the minds of consumers

Differentiation: actually differentiating the market offering to create superior

customer value
| MARKETING STRATEGY AND THE MARKETING
MIX
DEVELOPING AN INTEGRATED MARKETING MIX
DEFINING MOMENT
Marketing Mix: the set of
controllable, tactical marketing
tools - product, price, place and
promotion - that the firm blends
to produce the response it
wants in the target market
| MARKETING STRATEGY AND THE MARKETING
MIX
DEVELOPING AN INTEGRATED MARKETING MIX
Product: the market offering - a product, service or a combination of goods and services

Price: the amount of money customers pay to obtain the product

Place: refers to the distribution of the product and the availability of the service

Promotion: activities that communicate the merits of the product and persuade
customers to buy it

An effective marketing program blends all of the marketing mix elements into an
integrated marketing program designed to achieve the company’s marketing
objectives by delivering value to customers.

There’s just one problem….this tool kit only takes the seller’s perspective into
consideration - what about the consumer?
| MARKETING STRATEGY AND THE MARKETING
MIX
DEVELOPING AN INTEGRATED MARKETING MIX
The Four Cs

Customer Solution: customers see themselves as buying value or solutions to

their problems

I am hungry, I don’t want to cook

Customer Cost: customers are interested in the total costs to them of obtaining, using, and
disposing of a product

Convenience: customers want the product/service to be conveniently available

Communication: today’s consumer demands communication from

marketers/companies

All customers want to have a say

 | MANAGING THE MARKETING EFFORT

In addition to being good at the

marketing in marketing
management, companies need to
pay attention to the
management. Managing the
marketing process requires four
functions:
| MANAGING THE MARKETING EFFORT
MARKETING ANALYSIS

DEFINING MOMENT
SWOT analysis: an overall evaluation of the company’s strengths, weaknesses,
opportunities, and threats

Strengths: internal capabilities that may help a company reach its objectives

Weaknesses: internal limitations that may interfere with a company’s ability to achieve its
objectives

Opportunities: external factors that the company may be able to exploit to its advantage

Threats: current and emerging external factors that may challenge the company’s
performance

https://www.youtube.com/watch?v=I_6AVRGLXGA
| MANAGING THE MARKETING EFFORT
MARKETING PLANNING
Marketing planning involves deciding on marketing strategies that will help the company
attain its overall strategic objectives.

A typical marketing plan will include the following sections:

● Executive summary - brief summary of the main goals and recommendations of the
plan
● Current Marketing Situation - describes the target market and company’s position
● Threats & Opportunities - helps management anticipate important developments that
may have an impact on the company
● Objectives and Issues - states the marketing objectives that the company would like to
attain
● Marketing strategy - broad marketing logic outlined
● Action programs - how marketing strategies will be turned into action programs
● Budgets - essentially a projected profit-and-loss statement
● Controls - what will be used to monitor progress
| MANAGING THE MARKETING EFFORT
MARKETING IMPLEMENTATION

DEFINING MOMENT
Marketing Implementation: the process that turns marketing strategies and plans into
marketing actions to accomplish strategic marketing objectives

While marketing planning addresses the what and why of marketing activities,
implementation addresses the who, where, when and how. In an increasingly connected
world, people at all levels of the marketing system must work together to implement
marketing strategies and plans.
| MANAGING THE MARKETING EFFORT
MARKETING DEPARTMENT ORGANIZATION

In a small company, one person might do all of the research, selling, advertising, customer
service, and other marketing work.

In larger companies, positions are created to take care of the marketing segment of
operations. Many companies have now created a Chief Marketing Officer (CMO) position.

Today, more and more companies are shifting their focus away brand management and
towards customer management. They no longer think of themselves as managing a portfolio
of products and services, but a portfolio of customers
| MANAGING THE MARKETING EFFORT
MARKETING CONTROL

DEFINING MOMENT
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 company’s basic strategies are well
matched to its opportunities
| MEASURING AND MANAGING RETURN ON
MARKETING INVESTMENT |

DEFINING MOMENT
Return on Marketing (ROI)
Investment: the net return
from a marketing investment
divided by the costs of the
marketing investment

What is Marketing ROI