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