Download Marketing Planning and Control

Marketing Planning and Control
Introduction: Commercial success means delivering better value than the competition.
This involves technology, competitive strategies and competitive advantage ( to be or
provide better than competition).
The process by which companies analyze the environment, decide upon a course of
action, implement those decisions is called marketing planning.
Marketing Planning: The main role of the marketing plan is to ensure the marketing
mix(4ps of marketing) matches the changing customer needs as well as company
strengths to market other products to the new markets. Asking various questions like
whereabouts can have the executives answer some facts about where the company is
heading and future directions.
Process of Marketing Planning:
Business Mission: It is defined as a statement which distinguishes a business from the
others. It explains the reasons of company’s existence. It talks about needs, market,
resources, technology, human resources and need for change.
Purpose: The companies exist to serve the stakeholders in their individual interest in the
business; the idea is to draw everybody’s hand and interest to make the entire concept
worthwhile.
Strategy: It is a set of activities chosen to explain how the business is different from
others in providing the value proposition. It is for competitive advantage and is a set of
competencies to perform better than anyone in the market.
Standards and Behaviors: The general behavior etiquettes in a company.
Company Values: It is behavior, commitment, loyalty and quality, service levels
amongst employees, customers and outsiders.
Marketing Audit: It is a systematic evaluation of a business in terms of Marketing
Environment (internal and external), objective, strategies and activities. It is in terms of
statistical analysis (size, growth and trends), competitor analysis (profitability,
competencies), elaborate assessment( analysis of sales, market share, profit margins and
costs).
SWOT Analysis: Just like the traditional way of analysis of Strengths, Weaknesses,
Opportunities, Threats of a Business or a company is done to identify is current position
in the market.
Key question of Marketing Planning:
Where are we now and how did we get here?
Where are we heading?
Where would we like to be?
Are we under control?
Reward of Marketing Planning:
Consistency: Actions of the managers should be well coordinated and consistent.
Encourage monitoring of change: Review the change from strategic purpose.
Encourage Organizations Adaptation: The Business tries to match the changing
environment.
Stimulates Achievements: Motivates people to achieve new objectives.
Resource Allocation: Either Build , Harvest, Divest objectives are set.
Competitive Advantage: Planning the sources for it.
Problems in making Planning work:
Political: It is for resource allocation by the manager as he has got the powers to choose
from what he needs to concentrate on.
Opportunity Cost: Busy Management looks it as a time wasting activity.
Reward System: The managers may consider the short term issues and underweight long
term issues.
Information: Lack of data of various types.
Culture: Planning may be seen as threat
Personal Clashes
Lack of Knowledge and Skills.
How to handle Marketing Planning Problems:
 Top management gives full support.
 The process is consistent with culture and organization.
 The reward system is for the long term objectives.
 Depoliticizing Outcomes: Recognition of skills involved in defending market
share and harvesting the product should be made.
 Plans should be clearly communicated for implementation.
 Training: Training for marketing Knowledge.
Marketing Process:
Marketing Objective: It has a clear picture with Build, Hold, Harvest, Divest as the
strategic objectives. It is as the evidence in the BCG Matrix.
Strategic Options for increasing the sales volume:
It is by increasing the purchase size , frequency, offering them new products and entering
new markets.
Market Penetration: It is by effective promotion, distribution, cutting prices. The overall
strategies for the existing markets and existing products.
Market Expansion: It is when non users will come to buy the product and by increasing
the usage rate of the product.
Product Development: Products higher price, enhanced value, replacements of old
product is important.
Market development: Promotions of the products and services to the new added
segments of the market.
Entry into the new markets: Development of new products for the new markets.
Strategic Option for improving the Profitability:
Reduce Costs: Factors like closing the less efficient plants, reducing the investment in the
areas like stocks, work in progress.
Rationalize the Operations: Serve in a cheaper way(shifting from personal selling to
telesales), reduce operation, transportation costs, eliminating a certain product fro the
width.
Increasing the prices: The Company can increase the prices by providing extra value.
Core Strategy: It consists of
 Target Markets
 Competitor targets
 Competitive Advantage( being better, faster, in long term relation with customer)
Tests of an effective Core Strategy:
 Clear definition of the target customer and the needs
 Understanding the customers
 Element of risk and competition
 Resourceful and managerially supportable
 Objectives should be well defined
 Clear strategy.
Marketing Mix Decisions: When promotion and distribution surpasses the competition
than the competitive advantage is gained i.e. providing superior offering at a reasonable
cost also if the segment changes the marketing mix changes.
Implementation and Control:
Marketing Implementation:
Attractive Conditions: It is a build objective for the growth markets. In these markets
new users are attracted to the products. There are exploitable competitive weaknesses in
the mature or no growth market so there can be build objective.
Strategic focus:
Market Expansion: By creating new users, increasing frequency of purchase,
expansions, moving to larger target market.
Winning market share: This indicates winning market share at the expense of the
competition. Find the competition’s weakness and attack at that point.
Frontal Attack: It is by launching a similar product by having a similar or better
marketing mix. There should be cost leadership, competitive advantage. Also to match
the opponent in all the activities including technology.
Flanking attack: It considers attacking weakly guarded grounds i.e. attacking the
geographical areas where the competitor has poorly represented and not provoking any
head on confrontation. Mars attacked the Unilever’s Walls ice cream by launching a
premium brand of ice cream which was prevented by talking to the retailers.
Encirclement Attack: It is a type of attack in which we attack from all sides i.e. all the
market segments, product features and prices to be attacked e.g. Seiko produces over
2000 designs of watches in the world.
Bypass attack: This involves to circumference the defender’s position and attack with the
help of technology and providing a better product at low prices.
Guerilla attack: It involves pin pricking like price discounts, sales promotions,
advertising in few segments and regions. It is generally evident in from small companies
who may face a full frontal attack if provoked.
Mergers and Acquisitions: These are to merge with or acquire the competition. Hence
gives immediate sales boost and increase the market share. They are risky as well as they
generally involve different countries involving various culture, language and practices.
Forming Strategic alliance: These are the trading licensing for supply and R&D. All of
the activities like channels are jointly looked after. They are a learning example. A
leakage of technology and other know how is possible through this manner of strategy.
Hold Objective:
It is for defending the current position of the company against the moves of the
competition.
Attractive Conditions: This is a situation in a mature, low growth market just like a
situation of cash cow in the BCG Matrix with positive cash flow and low growth. Hence
in a declining market the weaker competition withdraws.
Strategic Focus:
Monitoring the competition: Everybody playing their good role as a competitor.
Confronting the competition: A risk of conflict may exist as it is a mature market.
Position Defense: It involves a defense mechanism for product of difficult times. Hence
offering all competitive prices and promoted effectively. Brand and reputation provide a
strong defense because of patent protection.
Flanking defense: It is moving and defending an unprotected market for gaining an
experience and protecting themselves, it is dangerous as the competition may later make
it their own market.
Preemptive defense:
Attack first: This involves a continuous innovation and product development.
Counter Offensive defense: This involves a heavy price cutting or a promotional
expenditure all what a competition has no done. It should be based on innovation.
Encircle the attacker: Launch of brands which compete directly with competitor’s
brand.
Mobile Defense: It involves either Diversification i.e. attempts to serve different markets
with different products or market broadening for example just called as the film making
to making up the entertainment providers and moving into theme parks, gambling,
magazines, TV.
Strategic Withdrawal: Withdrawal of all the businesses with no returns.
Niche Objectives:
This is a small unexploited market segment.
Attractive Conditions: These is more prevalent in the small budget companies where
strong competitors are dominating the major segment of the market.
Strategic Focus: The main focus is the market segmentation research through differential
advantage and understanding the needs.
Harvest objective:
It is a strategy when we try to collect all the profits in the market even when the sales are
falling.
Attractive conditions: It involves a drop of sales to a stable level than we prescribe the
harvest strategy.
Strategic focus: It involves eliminating the R&D costs and minimizing the expenditures,
raw materials, costs rationalizing the business with top liners. The business will grow
weaker and weaker.
Divest Objective:
Attractive Conditions: This means to completely stop investing in the product in the
market. All the loss making products from the product line are dropped.
Strategic focus: We should keep on harvesting until the Business drops. The main aim is
to minimize the costs.
Marketing Control: This is for the evaluation of the marketing system. The short term
control system can be weekly, monthly, quarterly or annually. The measures include
sales, profits, costs, cash flow. The long term plans are generally obsolete but the
competitors general improvement in the technology an other factors is thought for
exerting and improving the system of the self.