Marketing Marketing Management and the Management and the

Planning ProcessPlanning Process

How do I Decide Where I am How do I Decide Where I am Going?Going?

Marketing ManagementMarketing Management process of planning, process of planning,

implementing, and controlling implementing, and controlling marketing activities and marketing activities and decisions in order to facilitate decisions in order to facilitate exchangesexchanges

PlanningPlanning Process of Process of

anticipating the anticipating the future and future and determining the determining the courses of action courses of action necessary to necessary to achieve achieve organizational organizational goalsgoals

2 levels2 levels– strategic strategic

planningplanning

– tactical tactical planningplanning

Strategic PlanningStrategic Planning process of determining the primary process of determining the primary

objectives of the organization, the objectives of the organization, the adoption of courses of action, and the adoption of courses of action, and the allocation of resources necessary to allocation of resources necessary to achieve those objectives.achieve those objectives.– long-term (3-10 years)long-term (3-10 years)– top managementtop management– broad company issues: expansion or broad company issues: expansion or

contraction of markets, product linescontraction of markets, product lines

Tactical PlanningTactical Planning focuses on the implementation of focuses on the implementation of

the actions specified by the the actions specified by the strategic planning processstrategic planning process– (1 year or less) (1 year or less)

–middle and lower levels of middle and lower levels of managementmanagement

– determine target markets, marketing determine target markets, marketing mix strategiesmix strategies

The Marketing Planning The Marketing Planning ProcessProcess

Situation AnalysisSituation Analysis Determination of Organizational Determination of Organizational

ObjectivesObjectives Evaluate Environmental Risks and Evaluate Environmental Risks and

OpportunitiesOpportunities Formulate Marketing Objectives and Formulate Marketing Objectives and

StrategiesStrategies Implement Marketing Strategies Implement Marketing Strategies

Situational AnalysisSituational Analysis Internal ReviewInternal Review

– Review each of the Review each of the elements of the 4p’selements of the 4p’s

External ReviewExternal Review– CustomerCustomer– MarketplaceMarketplace– IndustryIndustry– Government/LegalGovernment/Legal– CompetitionCompetition

Determine Organizational Determine Organizational ObjectivesObjectives

Objectives are desired outcomes which Objectives are desired outcomes which guides management planning at lower guides management planning at lower levels and a standard for evaluating levels and a standard for evaluating performance. They must be:performance. They must be:– clear and specificclear and specific– stated in writingstated in writing– ambitious, but realisticambitious, but realistic– quantitatively measurablequantitatively measurable– tied to a time periodtied to a time period

Assess Organizational Assess Organizational ResourcesResources

Take stock of your Take stock of your assetsassets

what are we capable what are we capable of doing at this of doing at this moment?moment?

examples: examples: personnel strengths, personnel strengths, machinery machinery capability, markets capability, markets developeddeveloped

Evaluate Environmental Evaluate Environmental Risks/OpportunitiesRisks/Opportunities

look for the strategic window of look for the strategic window of opportunity where key opportunity where key requirements of the market and requirements of the market and the particular competencies of the particular competencies of the firm best fitthe firm best fit

Formulation of a Marketing Formulation of a Marketing StrategyStrategy

Overall company Overall company program for program for selecting a particular selecting a particular target market and target market and then satisfying then satisfying consumers in that consumers in that segment through segment through careful use of the careful use of the elements of the elements of the marketing mixmarketing mix

Several OptionsSeveral Options– undifferentiatedundifferentiated– differentiated differentiated – concentratedconcentrated

Ansoff’s GridAnsoff’s Grid– Market PenetrationMarket Penetration– Market DevelopmentMarket Development– DiversificationDiversification– Product DevelopmentProduct Development

Undifferentiated MarketingUndifferentiated Marketing

mass marketingmass marketing produces one product produces one product market to all consumersmarket to all consumers one marketing mixone marketing mix production efficient and simplistic; production efficient and simplistic;

minimize inventoryminimize inventory assumes market homogeneousassumes market homogeneous

Differentiated MarketingDifferentiated Marketing produce numerous products or produce numerous products or

servicesservices various marketing mixesvarious marketing mixes aim for smaller segments; needs aim for smaller segments; needs

better metbetter met costs of production and costs of production and

marketing risemarketing rise

Concentrated(Focused) Concentrated(Focused) MarketingMarketing

service only one service only one segment of the segment of the marketmarket

best informed of best informed of their needs and their needs and wantswants

is it dangerous to is it dangerous to put all your eggs in put all your eggs in one basketone basket

Growth StrategiesGrowth Strategies Market PenetrationMarket Penetration– use more effective marketing for use more effective marketing for

existing products and markets existing products and markets – attempt to increase repeat purchasesattempt to increase repeat purchases

Market DevelopmentMarket Development– geographical expansiongeographical expansion– new usesnew uses– new regionsnew regions

Growth Strategies Growth Strategies (cont’d)(cont’d)

Product DevelopmentProduct Development– same marketsame market– develop new productsdevelop new products– i.e.., Sonyi.e.., Sony

DiversificationDiversification– new productsnew products– new markets new markets – poor industry growthpoor industry growth

Consolidation StrategiesConsolidation Strategies Harvesting - good fit of product; Harvesting - good fit of product;

little opportunity for growth; little opportunity for growth; reduce $’s spent for promotionreduce $’s spent for promotion

Pruning - try to serve same Pruning - try to serve same markets - just reduce segment markets - just reduce segment coverage. Stick to what you do coverage. Stick to what you do best!best!

More ConsolidationMore Consolidation Retrenchment - opposite of Retrenchment - opposite of

developmentdevelopment– offer same product line - but retreat to offer same product line - but retreat to

strongest core marketstrongest core market DivestmentDivestment– sell off a product line or businesssell off a product line or business– weak fit between mission and weak fit between mission and

competencies and the requirements for competencies and the requirements for product success . EX: Burger Kingproduct success . EX: Burger King

Implementation of the Implementation of the StrategyStrategy series of tactical series of tactical

plansplans monitoring essential monitoring essential

to successto success unplanned events unplanned events

may impact plans in may impact plans in a negative way a negative way necessitating necessitating updates or changes updates or changes

Tools Used in the Strategic Tools Used in the Strategic Planning ProcessPlanning Process

Strategic Business Units (SBUs)Strategic Business Units (SBUs)– separately identifiable businessseparately identifiable business– distinct missiondistinct mission– own competenciesown competencies– executives with profit responsibilityexecutives with profit responsibility– key to determine optimal # of SBUs: to key to determine optimal # of SBUs: to

many - bogged down with details of many - bogged down with details of planning operating, control. Too Few - units planning operating, control. Too Few - units covering too broad a market to be usefulcovering too broad a market to be useful

Other ToolsOther Tools

Portfolio AnalysisPortfolio Analysis–Market Share/Market Growth Market Share/Market Growth

Matrix (BCG Matrix)Matrix (BCG Matrix)–Market Attractiveness/Business Market Attractiveness/Business

Strengths MatrixStrengths Matrix Spreadsheet AnalysisSpreadsheet Analysis