Transcript Company and marketing strategy: partning to build customer

Chapter 2
Objectives
Explain strategic planning
 Describe business portfolios and growth
strategies
 Detail marketing’s role in strategic
planning
 Describe elements of customer-driven
marketing strategy
 List the marketing management
functions

Marketing Process
Understan
ding the
market
place and
customer
needs and
wants
Research
customer and
the market
place
Managing
marketing
information
and customer
data
Design a
customerdriven
marketing
strategy
Select
customer to
serve: market
segmentation
and targeting
Decide on
value
proposition:
differentiation
and positioning
Construct
marketing
program
that
deliver
superior
value
Build
profitable
relationshi
p and
create
customer
delight
Product and
service design:
building a
strong brand
Customer
relationship
management:
build strong
relationship
with chosen
customers
Create satisfied
loyal customer
Partner
relationship
management :
build a strong
relationship
with marketing
partners
Increase share
of market and
share of
customer
Price Create
real value
Distribution
manage
demand and
supply chain
Promotion
Communicating
the value
Capture
value from
the
customers
to create
profits
Capture
customer life
time value
Company Wide Strategy Planning:
Defining Marketing’s Role

Strategic Planning Defined:
The process of developing and maintaining a
strategic fit between the organization’s goals
and capabilities and its changing marketing
opportunities

Strategic planning sets the stage for the
rest of the planning of the firm.
Defining the
company
mission
Setting
company
objectives and
goals
Designing the
business
portfolio
Planning
marketing and
other functional
strategy
Market Oriented-Mission

A mission statement asks..
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What is our business?
Who is the customer?
What do consumers value?
What should our business be?
A mission statement should be:
 serve as a guide for what the organization wants to
accomplish.
 be “market-oriented” rather than “product-oriented”.
(Example: eBay’s mission statement isn’t simply to hold online trading.
Instead, it connect individual buyers to sellers in “the world’s online
marketplace”
 be neither too narrow, nor too broad.
 fit with the market environment.
 be motivating.
A mission statement is:
“ A statement of the organization purpose – what it want to
accomplish in a larger environment.”

Setting Company Objectives and
Goals
The company’s mission needs to be turned
into detailed supporting objectives for each
level of management.
 The mission leads to a hierarchy of
objectives, including business objectives
and marketing objectives.
 Marketing strategies and programs must
be developed to support these objectives.

Setting Company Objectives and
Goals

Designing The Business Portfolio
The business portfolio is:
The collection of businesses and products
that make up the company.
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Business portfolio planning involves two
steps:
1.
Analyzing the current business portfolio &
Determine what role each SBU will play in
the future
2.
designing strategies for growth and
downsizing.
Designing The Business Portfolio
 Step
1:
A. Analyze the current business portfolio
○ Identify strategic business units (SBUs)
○ Assess each SBU:
 The BCG growth-share matrix classifies
SBUs into one of four categories using the:
- Market growth rate
- SBU’s relative market share within the market.
Designing The Business Portfolio
BCG Growth – Share Matrix
High
Market
Growth
Low
Market
Growth
Stars
Question Marks
Cash Cows
Dogs
High Relative
Market Share
Low Relative
Market Share
Designing The Business Portfolio
B. Determine the future role of each SBU and
choose the appropriate resource allocation
strategy:
 Build
○ Increase market share
○ Works well for question marks
 Hold
○ Preserve market share
○ Good for cash cow
 Harvest
○ Increases short-term cash flow
○ Good for weak cash cows, question marks and dogs
 Divest
○ Sell or liquidate
○ Good for dogs and question marks

SBUs change positions over time
Designing The Business Portfolio

Step 2:
Designing strategies for growth and downsizing.

Developing strategies for growth by identifying,
evaluating, and selecting promising new market
opportunities.
○
Product/market expansion grid
Developing strategies for downsizing the business
portfolio.
“ Reducing the business portfolio by eliminating products or
business units that are not profitable or that no longer fit
the company’s overall strategy”

Designing The Business Portfolio
Product/Market Expansion Grid
Existing
Markets
New
Markets
Existing Products
New Products
Market Penetration
Product Development
A strategy for company growth
by increasing sales of current
products to current market
segment without changing the
product
A strategy for company growth
by offering modified or new
product to current market
segments
Market Development
Diversification
A strategy for company growth
by identifying and developing
new market segments for
current company product
A strategy for company growth
through starting up or acquiring
businesses outside the
company’s current products
and markets
Marketing’s Role in Strategic
Planning

Marketing plays a key role in the
strategic planning process.
 Provide a guiding philosophy (the marketing
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concept)
Identify attractive opportunities
Design effective strategies for reaching
unit’s objectives.
Build strong value chains
Form superior value delivery networks
Marketing Strategy and The
Marketing Mix
Marketing Intermediary
Profitable customer
relationship
Competitors
- Market Segmentation
- Target Marketing
- Market Positioning
4 Ps
- Product
- Price
- Promotion
- Place
- Marketing Analysis
- Marketing Planning
- Marketing Implementation
- Marketing Control
suppliers
Public
Marketing Strategy
 Strategy
1.
2.
3.
Market
segmentation
Target marketing
Market positioning

The segmentation process
divides the total market into
market segments.

Market segment is a groups
of consumers who respond
in similar ways to marketing
efforts.
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Customers grouped by:
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Geographic
Demographic
Psychographic
Behavioral
Marketing Strategy
 Strategy
1.
2.
3.
Market
segmentation
Target marketing
Market positioning

valuation of each
segment’s attractiveness

Selection of segments with
greatest long-term
profitability
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A company can choose
one or several segments
to target
Marketing Strategy
 Strategy
1.
2.
3.
Market
segmentation
Target marketing
Market positioning

The place the product
occupies in the
consumer’s mind

Products are positioned
relative to competing
products

Marketers look for clear,
distinctive and desirable
place in positioning
Marketing Mix
The marketing mix includes controllable
and tactical marketing tools knows as
the 4P’s
 The 4P’s include

 Product
 Price
 Promotion
 place
Marketing Mix
Price
Product
Varity
Quality
Design
Features
Brand name Service
Packaging
Promotion
Advertising
Personal selling
Sales promotion
Public relation
List price
Discount
Allowances
Payment period
Credit terms
Target
customer
Intended
positioning
Place
Channels
Coverage
Assortment
Location
Transportation logistics
Inventory
Marketing Mix

The marketing mix from buyer’s
viewpoint
Four Ps
Four Cs
Product
Customer solution
Price
Customer cost
Place
Convenience
Promotion
Communication
Managing The Marketing Effort

Managing the marketing process require
four marketing management function
Analysis
Planning
Develop a
strategic
plane
Implementation
Control
Carry out the plans
Measure result
Evaluate Result
Develop
Marketing
Plane
Take corrective
actions
Market Analysis
Strength
Internal
Internal capabilities
that may help a
company reach its
objectives
Opportunities
External
External Factors that
the company may be
able to exploit to its
advantage
Positive
Weaknesses
Internal limitation
that may interfere
with the company’s
ability to achieve its
objectives
Threats
Current and
emerging external
factors that may
challenge the
company’s
performance
Negative
Managing the Marketing Effort
Marketing Functions
 Finding
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opportunities
 Avoiding threats
 Understanding
strengths
 Analyzing
weaknesses
Analysis
Planning
Implementation
Control
Managing the Marketing Effort
Marketing Functions
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Analysis
Planning
Implementation
Control
 Marketing plans include:
○ Executive summary
○ Analysis of current situation
○ Objectives
○ Targets and positioning
○ Marketing mix
○ Budget
○ Controls
Managing the Marketing Effort
Marketing Functions
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Analysis
Planning
Implementation
Control
 Plans are turned
into action with dayto-day activities
 Good
implementation is a
challenge
Managing the Marketing Effort
Marketing Functions
 Evaluation of the
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results of marketing
strategies
 Checks for
differences between
goals and
performance
Analysis
Planning
Implementation
Control