HMK001 LO2. Company & Marketing strategy: Partnering to build customer relos

Strategic planning

The process of developing & maintaining a strategic fit betw the organization's goals & capabilities & its changing marketing opportunities.

4 steps in strategic planning

1. Defining the company mission

2. Setting company objectives & goals

3. Designing the business portfolio

4. Planning marketing & other functional strategies.

Mission statement?

A stm of the organization's purpose

(what it wants to accomplish in the larger environment)

(should be market oriented & defined in terms of customer needs)

Qs the mission stm should answer

1. What is our business?

2. Who is our customer?

3. What do consumers value?

4. What should our business be?

Characteristics of an effective mission statement

Should be realistic, specific, fit the market environment, based on distinctive competencies, and motivating.

Business portfolio

The collection of businesses & products that make up the company.

Steps for company to design portfolio

1. Analyse its current business portfolio/Strategic Business Units (SBUs)

2. Decide which SBUs should receive more, less, or no inv

3. Develop growth strategies for growth/downsizing

Portfolio analysis

An evaluation of the products & business making up the company

(Resources are directed to more profitable businesses & weaker ones are phased down/dropped)

Strategic Business Unit (SBU)

A unit of the company that has a sep mission & objectives & can be planned independently from other company businesses.

An SBU can be a:

- Company division

- Product line within a division

- Or sometimes a single product/brand

4 categories in the BCG Growth-Share Matrix

stars, cash cows, question marks, dogs

Stars (BCG growth share matrix)

high market share & high market growth

(high high)

Question marks (BCG growth share matrix)

Low market share & high market growth

Cash cows (BCG growth share matrix)

High market share & low market growth

Dogs (BCG growth share matrix)

Low market share & low market growth

(low low)

Problems w matrix approaches (BCG growth share matrix)

*Can be difficult, time consuming, costly to implement

*Hard to define SBUs & measure mkt share & growth rate

*Focus on current businesses, little help w future planning

*Place too much emphasis on growth

*Lead to poorly planned diversification.

4 strategies for growth & downsizing

1. Market Penetration

2. Market Development

3. Product Development

4. Diversification: New products, new markets.

market penetration (strategy for growth & downsizing)

existing markets, existing products

market development (strategy for growth & downsizing)

new markets, existing products

product development (strategy for growth & downsizing)

existing markets, new products

diversification (strategy for growth & downsizing)

new products, new markets

Role of marketing strategic planning

Provides a guiding philosophy (marketing concept), inputs to strategic planners, & designs strategies to reach objectives.

Value Delivery Network (components)

Company's value chain, distributors, suppliers, & customers --> Improved perf in delivery value to customers is the goal

market segmentation

The process of dividing a market into distinct groups of buyers w diff needs, characteristics, or behaviour who might req sep products/marketing programs.

Market segment

Consists of consumers who respond in a similar way to a given set of marketing efforts

Target marketing

Involves evaluating each market segment's attractiveness & selecting 1 or more segments to enter

(target segments that can sustain profitability)

Market positioning

Arranging for a product to occupy a clear, distinctive, & desirable place relative to competing products in the minds of target consumers.

(Begins w differentiating the company's marketing offer so it gives consumers more value)

Marketing mix/4Ps

The set of controllable, tactical marketing tools that the firm blends to produce the response it wants in the target market

[Product, Price, Place, Promotion]

4 Ps in the marketing mix

1. Product 2. Price 3. Place 4. Promotion.

Product (4ps/marketing mix)

Variety, quality, design, features, brand name, packaging & services

Price (4ps/marketing mix)

List price, discounts, allowances, payment period & credit terms

Place [distribution] (4ps/marketing mix)

Channels, coverage, logistics, transportation, assortments & inventory

Promotion (4ps/marketing mix)

Advertising, sales promotion, public relations & personal selling

4 Cs of the marketing mix

Customer Solution, Customer Cost, Convenience, Communication

4 marketing management functions

1. Marketing Analysis

2. Marketing Planning

3. Marketing Implementation

4. Marketing Control

marketing analysis (4 marketing management functions)

SWOT analysis is key

marketing planning (4 marketing management functions)

create brand marketing plan

marketing implementation (4 marketing management functions)

determine who, where, when, how

marketing control (4 marketing management functions)

evaluate results, take corrective action

Strengths of SWOT analysis

Internal capabilities that may help a company reach its objectives.

Weaknesses of SWOT analysis?

Internal limitations that may interfere w a company's ability to achieve its objectives.

Opportunities of SWOT Analysis

External factors that the company may be able to exploit to its advantage

Threats of SWOT analysis

Current & emerging external factors that may challenge the company's performance.

Components of a brand/product marketing plan

1. Executive summary 2. Current marketing situation 3. Analysis of threats & opportunities 4. Objectives for the brand 5. Marketing strategy 6. Action programs 7. Marketing budget 8. Controls.

4 types of marketing department organization

1. Functional Organization

2. Geographic Organization

3. Product Management Organization

4. Market or Customer Organization

5. Combination Organization.

functional organisation (type of marketing dep organisation)

Each marketing activity is headed by a functional specialist

(Sales Manager, Advertising Manager, Director of Marketing Research, Customer Service Manager, New Product Manager)

geographic organisation (type of marketing dep organisation)

Sales & marketing people are assigned to specific countries, regions, & districts

product management organisation (type of marketing dep organisation)

One person given responsibility for compl strategy & marketing program for a single product

market/customer organisation (type of marketing dep organisation)

Manager resp for particular market/customer

combination organisation (type of marketing dep organisation)

Use some combination of the previous 4 approaches

(This is esp true in large companies)

Marketing control process

1. Set Goals 2. Measure Performance 3. Evaluate Performance 4. Take Corrective Action.

Operating control

Evaluates performance against the plan and takes corrective action

Strategic control

Evaluates whether strategies match opportunities

(The marketing audit is major tool)

2 methods for assessing return on marketing

1. standard marketing performance measures

2. customer-centered measures

standard marketing performance measures (method for assessing return on marketing)

Brand awareness, sales, market share

customer-centred measures (method for assessing return on marketing)

Customer acquisition, customer retention, customer lifetime value