Transcript 6c343479d1a52cc

The Marketing
Management
Process
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Marketing Management—A
Definition
 The process of analyzing, planning, implementing,
coordinating, and controlling programs
 Involves the conception, pricing, promotion, and
distribution of products, services, and ideas designed to
create and maintain beneficial exchanges with target
markets for the purpose of achieving organizational
objectives
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Marketing Management—A
Definition
 Basic focus of and the sequence of events within
marketing management
 A decision-making focus
 Analyzing the 4Cs
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Integrating Marketing Plans with the
Company’s Strategies and Resources
 Corporate strategy: Reflects the company’s mission
and provides direction for decisions about what
businesses it should pursue, how it should allocate its
available resources, and its growth policies
 Business-level strategy: Addresses how the business
intends to compete in its industry
 Marketing strategy: Reflect a firm’s interrelated
decisions about market segments, product line,
advertising appeals and media, prices, and
partnerships with suppliers, distributors, retailers, and
other agencies
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Market Opportunity Analysis
 Understanding market opportunities
 Customer analysis
 Marketing research and forecasting
 Market segmentation, targeting, and positioning
decisions
 Market segments: Distinct subsets of people with
similar needs, circumstances, and characteristics that
lead them to respond in a similar way to a particular
product or service offering or to a particular strategic
marketing program
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Formulating Strategic Marketing
Programs
 Specifying marketing objectives and strategies
 Marketing program components
 4 Ps: Product offering, price, promotion, place
 Marketing mix: The combination of controllable
marketing variables that a manager uses to carry out a
marketing strategy in pursuit of the firm’s objectives in a
given target market
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Exhibit 1.5 - Decisions within the Four
Elements of the Marketing Mix
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Formulating Strategic Marketing
Programs for Specific Situations
 The strategic marketing program for a product should
reflect market demand and the competitive situation
within the target market
 Different marketing strategies are typically more
appropriate and successful for different market
conditions and at different life-cycle stages
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Implementation and Control
of the Marketing Program
 A final critical determinant of a strategy’s success is
the firm’s ability to implement it effectively
 This depends on whether the strategy is consistent with
the resources, the organizational structure, the
coordination and control systems, and the skills and
experience of company personnel
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The Marketing Plan—A Blueprint for
Action
 A written document detailing the current situation
with respect to customers, competitors, and the
external environment and providing guidelines for
objectives, marketing actions, and resource allocations
over the planning period for either an existing or a
proposed product or service
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Exhibit 1.6 - Contents of a Marketing
Plan
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Exhibit 1.6 - Contents of a Marketing
Plan
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Some Recent Developments Affecting
Marketing Management
 Globalization
 Increased importance of service
 Information technology
 Relationships across functions and firms
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The Marketing Implications
of Corporate and Business
Strategies
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Three Levels of Strategy: Similar
Components, but Different Issues
 The hierarchy of strategies
 Corporate strategy
 Business-level strategy
 Functional strategies
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Corporate Scope—Defining the Firm’s
Mission
 A good mission statement guides an organization’s
managers as to which market opportunities to pursue
and which fall outside the firm’s strategic domain
 Market influences on the corporate mission
 Criteria for defining the corporate mission
 Social values and ethical principles

Ethics: Concerned with the development of moral standards
by which actions and situations can be judged
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Exhibit 2.6 - Characteristics of Effective
Corporate Mission Statements
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Corporate Objectives
 A performance dimension or attribute sought
 A measure or index for evaluating progress
 A target or hurdle level to be achieved
 A time frame within which the target is to be
accomplished
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Exhibit 2.8 - Common Performance Criteria and Measures
That Specify Corporate, Business-Unit, and Marketing
Objectives
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Exhibit 2.8 - Common Performance Criteria and Measures
That Specify Corporate, Business-Unit, and Marketing
Objectives
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Corporate Objectives
 The marketing implications of corporate objectives:
Most organizations pursue multiple objectives
 Trying to achieve many objectives at once leads to
conflicts and trade-offs
 Managers can reconcile conflicting goals by prioritizing
them
 Another approach is to state one of the conflicting goals
as a constraint or hurdle
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Corporate Sources of Competitive
Advantage
 A sustainable competitive advantage at the corporate
level is based on company resources - resources that
other firms do not have, that take a long time to
develop, and that are hard to acquire
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Corporate Growth Strategies
 A firm can go in two major directions in seeking future
growth
 Expansion of its current businesses and activities
 Diversification into new businesses, either through
internal business development or acquisition
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Exhibit 2.9 - Alternative Corporate
Growth Strategies
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Corporate Growth Strategies
 Expansion by increasing penetration of current
product-markets
 Expansion by developing new products for current
customers
 Expansion by selling existing products to new
segments or countries
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Corporate Growth Strategies
 Expansion by diversifying:
 Vertical integration


Forward vertical integration occurs when a firm moves
downstream in terms of the product flow
Backward integration occurs when a firm moves upstream by
acquiring a supplier
 Related (or concentric) diversification
 Unrelated (or conglomerate) diversification
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Allocating Corporate Resources
 To exploit the advantages of diversification
 Corporate managers must make intelligent decisions
about how to allocate financial and human resources
across the firm’s various businesses and productmarkets
 Two sets of analytical tools have proven useful in
making such decisions
 Portfolio models
 Value-based planning
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Portfolio Models
 Enable managers to classify and review their current
and prospective businesses by viewing them as
portfolios of investment opportunities and then
evaluating each business’s competitive strength and
the attractiveness of the markets it serves
 The Boston Consulting Group’s (BCG) growth-share
matrix
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Exhibit 2.10 - BCG’s Market Growth
Relative Share Matrix
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Exhibit 2.11 - Cash Flows across
Businesses in The BCG Portfolio Model
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The Marketing Implications of
Business-unit Strategy Decisions
 Strategic business units: Components of a firm
engaged in multiple industries or businesses
 Steps in developing business-level strategies
 Deciding how to divide into SBUs
 Managers must recommend:
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


The unit’s objectives
The scope of its target customers and offerings
Which broad competitive strategy to pursue
How resources should be allocated
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How Should Strategic Business Units
Be Designed?
 Characteristics of strategic business units
 A homogeneous set of markets to serve with a limited
number of related technologies
 A unique set of product-markets
 Control over those factors necessary for successful
performance
 Responsibility for their own profitability
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How Should Strategic Business Units
Be Designed?
 Dimensions that define the scope and mission of the
entire corporation also define individual SBUs
 Technical compatibility
 Similarity in the customer needs
 Similarity in the personal characteristics
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The Business Unit’s Objectives
 Corporate objectives typically broken down into
subobjectives for each SBU
 Breaking down an SBU’s objectives into
subobjectives for each of its productmarket entries
is often a major part of developing business-level
strategy
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The Business Unit’s Competitive
Strategy
 Decisions about an SBU’s scope
 Allocating resources within the business unit
 Gaining a competitive advantage
 Marketing resources and competitive advantage
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Exhibit 2.13 - Three Competitive Strategies and the Traits and
Competencies of Businesses That Implement Them
Effectively
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