© 2010 Pearson Education Canada 2-1 Chapter Two Marketing Strategy: Where Marketing Really Begins With Duane Weaver

© 2010 Pearson Education Canada2-1

Chapter TwoMarketing Strategy: Where Marketing Really Begins

With Duane Weaver


• Strategic Planning Defined and the Process• SBU’s• Marketing Positioning – Tools:

- The BCG Matrix and- The Product-Market Expansion Grid

• Partnering• Strategy a& Marketing Mix• Segmentation• Differentiation & Positioning• Managing Effort, SWOTs, & ROI• A Marketing Plan

OUTLINE

© 2010 Pearson Education Canada

What Is Strategic Planning?

Strategic Planning is the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities.


Strategic Planning and the Marketing Process

Company Wide Strategic PlanningCompany Mission and Company Objectives

Design Business Portfolio BCG Matrix

Strategies for Growth Product Market Expansion

Developing Customer Driven Marketing Strategy Segmentation, Targeting and Positioning

Developing the Integrated Marketing MixProduct, Price, Place, Promotion


Company Wide Strategic Planning

• Defining a Clear Company Mission– States the organization’s purpose.– Market and customer-oriented.– Provides direction to internal stakeholders.

• Setting Company Objectives and Goals– The mission of the organization is translated to

detailed, quantifiable objectives – The rest of the planning process is supported by

these objectives


Mission Statements

• Mission statementA statement of the organization’s purpose -what it wants to accomplish in the larger environment.

• It answers basic questions – What is our business?– Who is the customer?– What does the customer value?– What should our business be?


Defining a Market Oriented Mission

A market oriented mission statement

–Defines the business in terms of satisfying customer needs

–Will not be too narrow or too broad–Will be in tune with the current market

environment


Company Objectives and Goals• Goals must be sustainable and lead to

growth• Corporate objectives include marketing

objectives (specific, measurable, obtainable):– Invest in research and development– Improve or develop new products– Develop customer relationships


Strategic Business Units (SBU)

• A unit of the company that has a separate mission and objectives and that can be planned independently from other company businesses.

• Can be a company division, a product line within a division or sometimes a single product or brand


Business Portfolio• The business portfolio is the collection of

businesses and products that make up the company.

• The company must:– Analyze its current business portfolio or Strategic

Business Units (SBUs).– Decide which SBUs should receive more, less or no

investment.– Develop growth strategies for growth or downsizing

and portfolio planning using tools such as the BCG matrix.


The BCG Growth Share Matrix

Rising Stars Question Marks

Cash Cows DogsFix or abandon

Use cash to makeinto a star

Nurture to generate cash

Defend position

Industry attractiveness, marketshare, cash generation

Businessstrength,growth rate,cash use


Analyze Opportunities• Product-Market Expansion Grid identifies

four potential growth areas.

MarketPenetration

ProductDevelopment

DiversificationMarket

Development

ExistingProducts

NewProducts

ExistingMarkets

NewMarkets


Product/Market Expansion Grid• Strategies for growth

– Market penetration strategy– Market development strategy– Product development strategy– Diversification strategy

• Strategies for international growth– Company must decide whether to go

international, then which markets, how many, and which types to enter

in-class notes


Partners Create and Deliver Customer Value

• Partnering to build customer relationships – In building profitable customer relationships

companies partner with the value chain to deliver value to its customers

– The value chain is the collective system of internal company departments and external business partners that together provide customer value by producing, delivering, marketing, and supporting the company’s products


Marketing Strategy and the Marketing Mix

Mission Statement

Corporate Objectives

Business Objectives

Marketing Objectives

Marketing Strategies - The marketing logic by which the company creates customer value and achieves profitable customer relationships.

Marketing Mix Strategies – guided by marketing strategies made up of factors under its control - product, price, place, and promotion.


Customer Driven Marketing Strategy

• Market Segmentation – sub dividing the target market

• Market Targeting – evaluating each segment and selecting one or more segments

• Market Differentiation and Positioning – occupy a clear distinctive place in consumer’s mind


Market Segmentation• The process of dividing a market into distinct groups of

buyers with different needs, characteristics or

behaviours who might require separate products or

marketing programs.

• Consumers are grouped into market segments based

on:• Geographic

• Demographic

• Psychographic

• Behavioral factors (e.g.: bought here before-loyalty)


Market Segmentation - exercise

PLEASE TAKE 5 MINUTES TO:

1. Get into your case team groups.

2. Choose a company you are familiar with as a team.

3. Identify one of the typical customers they sell to.

A. Determine what form of market segmentation

would work for them best to reach this type of

customer (as a group/segment)?

B. Be prepared to explain to the class why you think

this type of segmentation is the best approach.


Market Differentiationand Positioning

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

• Process begins with differentiating the company’s marketing offer so it gives consumers more value.


The Marketing MixThe set of controllable, tactical

marketing tools that the firm blends to produce the response it wants in the

target market.


Creating the Integrated Marketing Mix

• Product – offers the right product, service or experience.

• Price – controls perceived value and satisfaction.

• Place – allows customers’ easy access to product and support.

• Promotion – communicates the offer and the value proposition.


The Four Ps and the Four Cs

• PRODUCT provides CUSTOMER SOLUTION

• PRICE represents CUSTOMER COST

• PLACE provides CONVENIENCE

• PROMOTION is two-way COMMUNICATION


• Marketing Analysis – A detailed description and analysis of the current situation facing the company (e.g.: SWOT)

• Marketing Planning – a detailed plan for each business unit

• Marketing Implementation – turning plans into action

• Marketing Department Organization – • Functional organizations• Product organizations• Market based organizations• Geographic organizations• Combinational organizations

• Marketing Control – evaluating the results

2-23

Managing the Marketing Effort


Measuring and Managing Return on Marketing Investment

Can you PROVE it will or it did work?• Return on Marketing Investment

– The return on investment that can be calculated and attributed directly to the efforts of marketing

– Calculated by dividing net return from marketing by the cost of marketing investment

– Measures the profits generated by investments in marketing activities


A Marketing Plan Outline• Executive summary.• Current marketing situation.

– Market description.– Product review.– Competitive review.– Review of distribution.

• Threat and opportunity analysis (SWOT).• Objectives and issues.• Marketing strategy.• Action program.• Budgets.• Controls.


Thanks!

Documents

© 2010 Pearson Education Canada 2-1 Chapter Two Marketing Strategy: Where Marketing Really Begins With Duane Weaver