Transcript Slide 1

Chapter 1
Strategic Planning
and the Marketing
Management
Process
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
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The Marketing Concept
• An organization should seek to make a profit
by serving the needs of customer groups
• The purpose is to rivet the attention of marketing
managers on customer orientation, rather than on
product orientation or selling orientation
• The principal task of the marketing function Find effective and efficient means of making
the business do what suits the interests of
customers
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Marketing
• The activity, set of institutions, and processed for creating,
communicating, delivering, and exchanging offerings that have
value for customers, clients, partners, and society at large
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Figure 1.1 - Major Types of Marketing
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Strategic Planning and Marketing
Management
• Strategic planning:
• All the activities that lead to the development of a
clear organizational mission
• Organizational objectives
• Appropriate strategies to achieve the objectives
for the entire organization
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Figure 1.2 - The Strategic Planning
Process
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Organizational Mission
• In developing a statement of mission,
management must take into account three key
elements:
• The organization’s history
• The organization’s distinctive competitiveness
• The organization’s environment
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Organizational Mission
• An effective mission statement should be:
•
•
•
•
Focused on markets rather than products
Achievable
Motivating
Specific
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Organizational Objectives
• Objectives must be:
• Specific
• Measurable
• Action commitments
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Organizational Objectives
• If formulated properly, organizational
objectives:
• Can be converted into specific action
• Will provide direction
• Can establish long-run priorities for the
organization
• Can facilitate management control
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Figure 1.3 - Sample Organizational
Objectives
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Organizational Strategies
• Organizations can pursue various strategies
based on:
• Products and markets
• Competitive advantage
• Value
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Figure 1.4 - Organizational Growth
Strategies
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Organizational Strategies Based on
Competitive Advantage
• Cost leadership strategy - A firm would focus
on being the low-cost company in its industry
• Strategy based on differentiation - A firm
seeks to be unique in its industry or market
segment along particular dimensions that the
customers value
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Strategies Based on Value
• Three value strategies:
• Best price
• Best product
• Best service
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Choosing an Appropriate Strategy
• Management should:
• Select those strategies consistent with its mission
• Capitalize on the organization’s distinctive
competencies
• Sustainable competitive advantage can be
based on either the assets or skills of the
organization
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Organizational Portfolio Plan
• The first step in this approach is to identify the
various divisions, product lines, and so on that
can be considered a business
• Also called strategic business units (SBUs)
• The next step is to establish methods to
determine how resources should be allocated
among the various SBUs
• Known as portfolio models
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The Marketing Management Process
• Process of planning and executing the conception, pricing,
promotion, and distribution of goods, services, and ideas to create
exchanges with target groups that satisfy customer and
organizational objectives
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Figure 1.5 - Strategic Planning and
Marketing Planning
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Situation Analysis
• Involves analysis of the past, present, and
likely future in six major areas of concern:
• Cooperative environment - Includes all firms and
individuals who have a vested interest in the firm’s
accomplishing its objectives
• Competitive environment - Includes primarily
other firms in the industry that rival the
organization for both resources and sales
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Situation Analysis
• Economic environment - State of the
macroeconomy and changes in it also bring about
marketing opportunities and constraints
• Social environment - Includes general cultural and
social traditions, norms, and attitudes
• Political environment - Includes the attitudes and
reactions of the general public, social and business
critics, and other organizations
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Situation Analysis
• Legal environment - Includes a host of federal,
state, and local legislation directed at protecting
both business competition and consumer rights
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Marketing Planning
• Produces three outputs:
• Establishing marketing objectives
• Selecting the target market
• Developing the marketing mix
• Marketing mix: A set of controllable variables that must
be managed to satisfy the target market and achieve
organizational objectives
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Implementation of the Marketing
Plan
• Involves putting the plan into action and
performing marketing tasks according to the
predefined schedule
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Control of the Marketing Plan
• Involves three basic steps:
• Measuring results of implemented marketing plan
• Comparing results with objectives
• Making decisions on whether plan is achieving
objectives
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Marketing Information Systems and
Marketing Research
• Throughout the marketing management
process, current, reliable, and valid
information is needed to make effective
marketing decisions
• Providing this information is the task of the
marketing information system and marketing
research
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The Strategic Plan, The Marketing Plan,
and Other Functional Area Plans
• Strategic planning is a top-management
responsibility
• Ways in which marketing executives are
involved in the strategic planning process:
• They influence the process by providing important
inputs in the form of information and suggestions
relating to customers, products, and middlemen
• They must always be aware of what the process of
strategic planning involves as well as the results
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Marketing’s Role in Cross-Functional
Strategic Planning
• More organizations are bringing managers and
employees together to participate in crossfunctional teams
• All personnel working in a cross-functional
team participate in creating a strategic plan to
serve customers
• The greatest advantage of cross-functional team is
the ability of team members to consider a
situation from a number of viewpoints
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Marketing’s Role in Cross-Functional
Strategic Planning
• Strategic planning results in a clearly defined
blueprint for management action in all
functional areas of the organization
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Figure 1.6 - The Cross-Functional
Perspective in Planning
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Figure 1.7 - A Blueprint for
Management Action
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