Marketing Planning Strategic Marketing. Marketing Planning Good marketing requires good planning To...

Marketing Planning

Strategic Marketing

Marketing Planning

Good marketing requires good planning To plan accordingly a company must

examine itself & its business environment

Companies conduct a SWOT Analysis to accomplish this

Marketing Planning

What is a SWOT Analysis? A SWOT Analysis occurs when a

company looks at their strengths and weaknesses and analyzes the opportunities and threats that surround them.

Helps handle weaknesses Prepares for threats

Strengths & Weaknesses

Strengths & weaknesses are internal factors that affect a business

Internal Analysis centers on the 3 C’s Company

What a company does well & what don’t they do well Customers

Customer feedback/surveys Competition

What is your company market share vs. your competitors? What products, promotions, etc.. do they offer that are successful?

Must evaluate these components fairly Sometimes done by outside strategists

Strengths & Weaknesses

Organizational Resources help identify internal factors Production costs Marketing skills Financial Resources Employee Capabilities Available Technology

External Opportunities & Threats

Opportunities and Threats are external factors that affect a company

Examine what your competition is doing

Conduct Environmental Scans

External Opportunities & Threats

Environmental Scan: Examine outside influences that impact your company

Political/Legal: Laws, Regulations, Foreign Policy, etc..

Economic: Robust Economy v. Recession

Socio-Cultural: Lifestyle, Attitudes, Opinions, & Demographics of customers

Technological: Taking advantage of the latest & greatest

McDonald’s SWOT Example

List at least two examples from the information given

Competitive Advantage

Competitive Advantage is a set of unique features of a company and its products Target Market views them as significant or

superior to the competition There are 3 types of competitive advantages

Cost Product/Service Differentiation Niche Strategies

Cost Competitive Advantage

Having a cost competitive advantage means being the low-cost competitor in an industry while maintaining satisfactory profit margins. Obtain inexpensive raw materials Efficient manufacturing facilities Avoid marginal customers

Wal-mart is a company with a cost-competitive advantage Strong Buying Power Relationships

Cost Competitive Advantage Costs can be reduced for a company through….

Experience Curves: Costs will decline as experience with a product increases.

Prices are set based on anticipated costs versus current costs

Efficient Labor: Labor costs are typically higher in low-skill, labor-intensive industries such as product assembly & apparel merchandise Nike, Levi’s, & Liz Clairborne all produce overseas

Cost Competitive Advantage

No frills goods & services Eliminate extras to reduce costs Example Southwest & Allegiant Airlines

Government Subsidies Government provides grants & interest free

loans to target industries Example agriculture industry $10 - $30

billion a year

Cost Competitive Advantage

Product Design Cutting-edge design technology offsets labor

costs Examples are BMW & Companies using

Reverse Engineering

Reengineering Rethinking & redesigning a process to increase

profits Often done by reorganizing specific departments

Cost Competitive Advantage

Product Innovations Done to lower production costs (new technology)

New Methods of Service Delivery Medical expenses have been lowered due to

outpatient surgery & walk-in clinics Airlines promote online purchasing & kiosks Banks charge for using a teller

Product/Service Differentiation

Product/Service Differentiation exists when a firm provides something unique that is valuable to buyers beyond simply offering a low price More sustainable than Cost Competitive Examples of how it occurs

Brand Name (Lexus) Strong Dealer Network (Caterpillar Tractor) Product Reliability (Maytag) Image (Neiman Marcus) Service (Fedex)

Niche Differentiation

Niche Differentiation seeks to target & effectively serve a single segment of the market Allows smaller companies to compete Take the “leftovers” of a giant corporation Usually occurs by targeting a specific

geographic area Jack in the Box only on West Coast

Competitive Advantage

A sustainable competitive advantage exists when it cannot be copied by the competition Nike, Rolex, Nordstrom, Southwest Air,

etc…

Building your competitive advantage versus copying it allows for more growth

Strategic Decisions

The end result of a SWOT Analysis & identification of a competitive advantage is to evaluate the strategic direction of the firm

There are three strategic decisions to choose from

Strategic Decision

Market Penetration is based off of trying to increase market share among existing customers.

Example Maxwell house creates an aggressive coffee

campaign with advertisements & price promotions such as coupons to existing customers.

The goal is to increase sales by adding more customers

Strategic Decision

Market Development means attracting new customers to existing products. New uses for old products McDonalds opening new restaurants in

Russia, China, & Italy Coke & Pepsi growing faster overseas

Strategic Decisions

Product Development strategies involve the creation of new products for present markets.

Clothing manufacturers are typically product developers Designing a suit that is better in hot

weather

Strategic Decisions

Diversification is a strategy of increasing sales by introducing new products into new markets

Example Sony buys Columbia Pictures Coca-Cola manufacturers water

treatment & water conditioning equipment

Assignment

Create a SWOT analysis for a competitor of your research company Identify the target market of your competition Each aspect of the SWOT needs to have at least two

identifiers

Explain to me how your company has created a competitive advantage & what they could do to create a competitive advantage using a different approach Cost Product/Service Differentiation Niche

Assignment Of the 3 Strategic Directions a company

can take, which approach does your company currently use. Explain answer.

Of the 3 Strategic Directions a company can take, what could your company do to fulfill those Market Penetration, Market Development, Product

Development

Marketing Planning