Chapter 2 Copyright ©2010 Cengage Learning Inc. All rights reserved 1 MKTG 2 CHAPTER Strategic...

Chapter 2 Copyright ©2010 Cengage Learning Inc. All rights reserved 1

MKTG

2CHAPTERStrategic Planning for Competitive Advantage

Chapter 2 Copyright ©2009 Cengage Learning Inc. All rights reserved. 2

Strategic Planning

The managerial process of

creating and maintaining a fit

between the organization’s

objectives and resources and

evolving market opportunities.

The goal is long-term

profitability and growth.

StrategicPlanning

StrategicPlanning


Levels of Strategy

Corporate Level Business Unit Level

• SBU’s Functional Level Operational Level


Strategic Planning

A …………….that acts as a

guidebook of marketing activities

for the marketing manager.

Marketing PlanMarketing Plan


Marketing Plan

Elements

Marketing Strategy

Product Distribution

Price

Marketing Mix

Business Mission Statement

Objectives

Situation or SWOT Analysis

Target Market Strategy

ImplementationEvaluation

Control

Promotion


Step 1:Defining the Business Mission

Answers the question, “What business are we in?”

Focuses on the market(s) rather than the good or service

Strategic Business Units (SBUs) may also have a mission statement



Q: What business are we in?

A: Business mission statement

Too narrowToo broadJust right

…………………….no directionfocus on marketsserved and benefitscustomers seek


LO1

Marketing Plan

Elements

Marketing Strategy

Product Distribution

Price

Marketing Mix


Objectives

Situation or SWOT Analysis

Target Market Strategy

ImplementationEvaluation

Control

Promotion


Step 2: Defining objectives

Marketing Objective

A statement of what is to

be accomplished through

marketing activities.


Marketing ObjectivesLO3

Realistic

Measurable

Time specific

Consistent with and indicating the priorities of the organization

“Our objective is to achieve 10 percent dollar market share in the cat food market within 12

months of product introduction.”


LO4

Step 3: Situation or SWOT Analysis

Identifying internal strengths (S) and weaknesses (W) and also examining external opportunities (O) and threats (T)

SWOT AnalysisSWOT Analysis


SWOT Analysis

©South-Western College Publishing

SSWWOOTT

………………………………………….………………………………………….

Things the company does not do well.Things the company does not do well.

Conditions in the external environment that favor ……………...Conditions in the external environment that favor ……………...

Conditions in the external environment that do not relate to existing strengths or favor areas of current weakness.

Conditions in the external environment that do not relate to existing strengths or favor areas of current weakness.

Internal

External


A strength could be:

?


A weakness could be

?


LO4

Environmental Scanning

The collection and

interpretation of information

about forces, events, and

relationships in the external

environment that may affect the

future of the organization or the

implementation of the

marketing plan.

EnvironmentalScanning

EnvironmentalScanning


An opportunity could be

?


A threat could be

?


Step 4: Marketing Strategy

LO7

The activities of selecting and

describing one or more target

markets and developing and

maintaining a marketing mix

that will produce mutually

satisfying exchanges with target

markets.

MarketingStrategy

MarketingStrategy


Identifying opportunities through STP

Segmentation

……………………

Positioning


Competitive Advantage

CompetitiveAdvantage

CompetitiveAdvantage

The set of unique features of a

company and its products that

are perceived by the target

market as significant and

superior to the competition.


Competitive Advantage: Is there ever no competition?

Niche StrategiesNiche Strategies

CostCost

Product/Service Differentiation


Types of Competitive Advantage

Types of Competitive Advantage


Cost Competitive Advantage



Being the low-cost

competitor in an industry

while maintaining

satisfactory profit

margins.



Product/ServiceDifferentiation Competitive Advantage

Product/ServiceDifferentiation Competitive Advantage

The provision of

something that is unique

and valuable to buyers

beyond simply offering a

lower price than the

competition’s.


Niche Competitive Advantage



The advantage achieved

when a firm seeks to

target and effectively

serve a small segment of

the market.

Twitter or Facebook?


Sources of Sustainable Competitive Advantage

PatentsPatents

CopyrightsCopyrights

LocationsLocations

EquipmentEquipment

TechnologyTechnology

Customer ServiceCustomer Service

PromotionPromotion

Skills and Assets

of anOrganization

Skills and Assets

of anOrganization


Growth Strategies

6

Diversification =

Product development = ________

Market development = ________

Market penetration =share

new productsnew markets


Portfolio Matrix

Stars

Cash Cows

ProblemChildren

Dogs


Target Market Strategies

Entire MarketMultiple Market

SegmentsSingle Market

Segment

Target Market Options


The Marketing Mix

A unique blend of product,

distribution, promotion, and

pricing strategies designed to

produce mutually satisfying

exchanges with a target market.

Marketing MixMarketing Mix


Marketing Mix: The “Four Ps”

The starting point of the “4 Ps”

Includes Physical unit Package Warranty Service Brand Image Value

Product

Products can be… Tangible goods Ideas Services



Product availability where and when customers want them

All activities from raw materials to finished products

Ensure products arrive in usable condition at designated places when needed

Place



Promotion

Online

Role is to bring about exchanges with target markets by: Informing Educating Persuading Reminding

Includes integration of: Personal selling Advertising Sales promotion Public relations



Price Price is what a buyer

must give up to obtain a product.

The most flexible of the “4 Ps”-- quickest to change

Competitive weapon

Price x Units Sold = Total Revenue

Chapter 2 Copyright ©2010 Cengage Learning Inc. All rights reserved

Step 5: Following Up on the Marketing Plan

Implementation

Evaluation

Control

Marketing audit is… Comprehensive Systematic Independent Periodic


Check Yourself

1. What are the five steps in creating a marketing plan?

2. What tool helps a marketer conduct a situation analysis?

3. What is STP?


Check Yourself

1. What are the four growth strategies?

2. What type of strategy is growing the business from existing customers?

3. Which strategy is the riskiest?

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