Transcript Document
2 CHAPTER Strategic Planning and the Marketing Process Chapter Objectives 1 Distinguish between strategic planning and tactical planning. 2 Explain how marketing plans differ at various levels in an organization. 3 Identify the steps in the marketing planning process. 4 Describe successful 5 Identify the basic planning tools and elements of a marketing techniques, including strategy. Porter’s Five Forces 6 Describe the model, first and second environmental mover strategies, SWOT characteristics that analysis, and the strategic influence strategic window. decisions. 7 Describe the methods for marketing planning, including business portfolio analysis and the BCG matrix. CHAPTER 2 Strategic Planning and the Marketing Process Strategic Vs. Tactical CHAPTER 2 Strategic Planning and the Marketing Process MARKETING PLANNING: THE BASIS FOR STRATEGY AND TACTICS • Planning Process of anticipating future events and conditions and of determining the best way to achieve organizational objectives. • Marketing planning Implementing planning activities devoted to achieving marketing objectives. CHAPTER 2 Strategic Planning and the Marketing Process Strategic Planning versus Tactical Planning Strategic planning: Process of determining an organization’s primary objectives and adopting courses action that will achieve those objectives Tactical planning: Process that guides the implementation of activities specified in the strategic plan. CHAPTER 2 Strategic Planning and the Marketing Process Steps in the Marketing Planning Process CHAPTER 2 Strategic Planning and the Marketing Process PLANNING AT DIFFERENT ORGANIZATIONAL LEVELS • Focus on planning changes in different levels of the organization. CHAPTER 2 Strategic Planning and the Marketing Process • Defining the Mission of the Organization – Mission: the essential purpose that differentiates one company from others – The mission statement specifies the organization’s overall goals and operational scope and provides general guidelines for future management actions CHAPTER 2 Strategic Planning and the Marketing Process DEFINING THE ORGANIZATION’S MISSION AND OBJECTIVES • Mission Essential purpose that differentiates one company from another. Specifies the organization’s overall goals and operational scope and provides general guidelines for future management actions • Examples: • 3M: “To solve unsolved problems innovatively.” • Mary Kay Cosmetics: “To give unlimited opportunity to women.” • Merck: “To preserve and improve human life.” • Objectives—Guide the development of marketing objectives and plans. • Examples: • Generate a 10 percent profit over the next twelve months. • Attain a 20 percent share of the market by 2010. • Add 50 new stores within the next year. CHAPTER 2 Strategic Planning and the Marketing Process ASSESSING ORGANIZATIONAL RESOURCES AND EVALUATING ENVIRONMENTAL RISKS AND OPPORTUNITIES • Resources include the capabilities of the firm’s production, marketing, finance, technology, and employees. • Strengths help planners set objectives, develop plans, and take advantage of marketing opportunities. FORMULATING, IMPLEMENTING, AND MONITORING A MARKETING STRATEGY • Should be efficient, flexible, adaptable, and implemented company-wide. • Blends elements of the marketing mix: product, distribution, promotion, and price. CHAPTER 2 Strategic Planning and the Marketing Process SUCCESSFUL STRATEGIES: TOOLS AND TECHNIQUES • Goal of tools and techniques is to create sustainable competitive advantage. PORTER’S FIVE FORCES MODEL • Porter’s Five Forces Model developed by strategy expert Michael Porter that identifies five competitive forces that influence planning strategies: • The threat of new entrants • The bargaining power of buyers • The bargaining power of suppliers • The threat of substitute products • Rivalry among competitors CHAPTER 2 Strategic Planning and the Marketing Process CHAPTER 2 Strategic Planning and the Marketing Process FIRST MOVER AND SECOND MOVER STRATEGIES • First mover strategy Theory advocating that the company that is first to offer a product in a marketplace will be the long-term market winner. • Second mover strategy Theory that advocates observing closely the innovations of first movers and then improving on them to gain advantage in the marketplace. SWOT ANALYSIS • SWOT analysis Analysis that helps planners compare internal organizational strengths and weaknesses with external opportunities and threats. THE STRATEGIC WINDOW • Strategic window Limited periods during which the key requirements of a market and the particular competencies of a firm best fit together. • Example: Soaring demand for cars in China. CHAPTER 2 Strategic Planning and the Marketing Process SWOT ANALYSIS • SWOT analysis Analysis that helps planners compare internal organizational strengths and weaknesses with external opportunities and threats. CHAPTER 2 Strategic Planning and the Marketing Process ELEMENTS OF A MARKETING STRATEGY THE TARGET MARKET • The group of people toward whom the firm directs its marketing efforts and merchandise. • Need to pay attention to growing market segments. • Example: Growing Hispanic population in United States. MARKETING MIX VARIABLES • Marketing mix Blending of the four strategy elements—product, distribution, promotion, and pricing—to fit the needs and preferences of a specific target market. CHAPTER 2 Strategic Planning and the Marketing Process THE MARKETING ENVIRONMENT • Five external dimensions that affect the marketing mix variables: • Competitive, political-legal, economic, technological, and socialcultural factors. • Rapid technological changes can spur lawsuits and create new forms of competition. • Rule of three—The three strongest, most efficient companies dominate 70 to 90 percent of a market. • Example: Cereal manufacturers—General Mills, Kellogg’s, and Post. CHAPTER 2 Strategic Planning and the Marketing Process METHODS FOR MARKETING PLANNING BUSINESS PORTFOLIO ANALYSIS • An evaluation of a company’s products and divisions to determine the strongest and weakest ones. • Strategic business units Key business units within diversified firms. • Each has its own managers, resources, objectives, and competitors. • Help focus the attention of managers. • Example: Hewlett-Packard’s iPaq unit for its handheld computer. CHAPTER 2 Strategic Planning and the Marketing Process BCG ANALYSIS • Developed by Boston Consulting Group. • A market share/market growth matrix that plots market share against market growth potential.