Transcript Chapter 2

MARKETING STRATEGY
O.C. FERRELL • MICHAEL D. HARTLINE
2
Strategic Marketing
Planning
The Strategic Planning Process
• Marketing Plan
– “…a written document that provides the
blueprint or outline of the organization’s
marketing activities, including the
implementation, evaluation, and control of
those activities.”
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Discussion Question
• What role, if any, should customers play in
the strategic planning process? Should they
have a voice in developing the
organizational mission, marketing goals, or
the marketing strategy?
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Exhibit 2.1
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Organizational Mission vs.
Organizational Vision (1 of 2)
• Elements of the Mission Statement
– Five basic questions to be answered:
• Who are we?
• Who are our customers?
• What is our operating philosophy?
• What are our core competencies or
competitive advantages?
• What are our concerns and interests related to
our employees, our community, society in
general and our environment?
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Organizational Mission vs.
Organizational Vision (2 of 2)
• Mission Width and Stability
– Width: Too broad or too narrow?
– Stability: Frequency of modifications
• Customer-Focused Mission Statements
– Ben and Jerry’s 3-part Mission Statement
• Product Mission
• Economic Mission
• Social Mission
– Tylenol
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Marketing Strategy in Action
• As this 1946 ad
demonstrates, railways
were once a prominent
way to travel across the
country.
• How did narrow mission
statements lead to missed
opportunities for the
railroad industry?
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Ben & Jerry’s 3 Part Mission
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Corporate or Business-Unit Strategy
• Business-Unit Strategy:
– The central means for:
• Utilizing and integrating the organization’s resources
• Carrying out the organization’s mission
• Achieving the organization’s desired goals and objectives
– Associated with developing a competitive advantage
– Determines the nature and future direction of each
business unit
– Essentially the same as corporate strategy in small
businesses
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Functional Goals and Objectives
• All business functions must support the
organization’s mission and goals.
• Functional objectives should be expressed
in clear, simple terms.
• All functional objectives should be
reconsidered for each planning period.
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Functional Strategy
• Functional strategies are designed to integrate
efforts focused on achieving the area’s stated
objectives.
• The strategy must:
– (1) Fit the needs and purposes of the functional area
– (2) Be realistic with the organization’s resources and
environment
– (3) Be consistent with the organization’s mission
goals, and objectives.
• The effects of each functional strategy must be
evaluated.
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Implementation
• Involves activities that execute the
functional strategy.
• Functional plans have two target markets:
– (1) External market
– (2) Internal market
• A company must rely on its internal market
for a functional strategy to be implemented
successfully.
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Discussion Question
• Defend or contradict this statement:
Developing marketing strategy is more
important than implementing marketing
strategy because if the strategy is flawed, it
doesn’t matter how well it is implemented.
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Evaluation and Control
• Designed to keep activities on target with goals
and objectives
• Coordination among functional areas is a critical
issue
– Open lines of communication is the key
• Evaluation and control is both an ending and
beginning:
– Occurs after a strategy has been implemented
– Serves as the beginning point for planning in the next
cycle
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The Marketing Plan
• Detailed formulation of the actions needed
to carry out the marketing program
• An action document:
– The handbook for marketing implementation,
evaluation and control
• Not the same as a business plan
• Requires a great deal of information from
many different sources
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Marketing Plan Structure (1 of 5)
• Should be well organized
• A good marketing plan outline is:
– Comprehensive
– Flexible
– Consistent
– Logical
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Marketing Plan Structure
Exhibit 2.3
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Marketing Plan Structure (2 of 5)
• I. Executive Summary
– Synopsis of the overall marketing plan
– Introduces major aspects of the marketing plan
• II. Situation Analysis
– Summarizes information about 3 key environments:
• Internal environment
• Customer environment
• Firm’s external environment
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Marketing Plan Structure (3 of 5)
• III. SWOT Analysis
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Strengths
Weaknesses
Opportunities
Threats
Analysis of the SWOT matrix
Establishing a strategic focus
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Marketing Plan Structure (4 of 5)
• IV. Marketing Goals and Objectives:
– Formal statements of desired and expected outcomes
of the marketing plan
– Goals:
• Broad, simple statements of what is to be accomplished
– Objectives
• More specific and essential to planning
• V. Marketing Strategy:
– Primary target market and marketing mix
– Secondary target market and marketing mix
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Marketing Plan Structure (5 of 5)
• VI. Marketing Implementation
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1. What specific marketing activities will be undertaken?
2. How will these activities be performed?
3. When will these activities be performed?
4. Who is responsible for the completion of these activities?
5. How will the completion of planned activities be monitored?
6. How much will these activities cost?
• VII. Evaluation and Control
– Formal marketing control
– Informal marketing control
– Financial assessments
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Using the Marketing Plan Structure
• Tips for using the marketing plan
framework to develop a marketing plan:
– Plan ahead
– Revise, revise, revise
– Be creative
– Use common sense and judgment
– Think ahead to implementation
– Update regularly
– Communicate with others
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Purposes and Significance
of the Marketing Plan
• A good marketing plan will:
– (1) Explain both the present and future situations of
the organization
– (2) Specify the outcomes that are expected
– (3) Describe the specific actions that are to take place
– (4) Identify the resources that will be needed
– (5) Permit the monitoring of each action and its
results
• Communicating the strategy to top executives is
paramount.
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Organizational Aspects of the
Marketing Plan
• Top managers ask two questions:
– (1) Will the marketing plan achieve the desired
goals and objectives?
– (2) Are there alternative uses of resources that
would better meet objectives?
• The marketing plan is most often prepared by the
Marketing Director or VP of Marketing
• The final approval lies with the President,
Chairman or CEO
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Major Problems in Developing and
Implementing the Marketing Plan
Exhibit 2.4
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Apple’s Changing Strategic Focus
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Strategic Planning in the
Market-Oriented Organization
• A Market-Oriented Organization:
– Shifts its focus:
• From products to the requirements of market segments
• From transactions to relationships
• From competition to collaboration
– Puts customer’s needs and wants first
– Focuses on long-term, value-added relationships
– Instills a corporate culture that puts customers at the
top of the organizational hierarchy
– Cooperates with suppliers and competitors to serve
customers better
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Traditional Organizations
CEO
CEO
Competition
Middle
Managers
Frontline Employees
Middle
Managers
Frontline Employees
Customers
Exhibit 2.5 – Part One
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Market-Oriented Organizations
Customers
Frontline Employees
Middle
Managers
Frontline Employees
Cooperation
CEO
Middle
Managers
CEO
Exhibit 2.5 – Part Two
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Discussion Question
• In many organizations marketing is not
given a place of importance in the
organizational hierarchy. Why do you think
this happens? What other business
functions get more importance? Why?
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