Download Strategic Market Planning - Washington State University

STRATEGIC MARKET
PLANNING
Marketing 360
Brian Gillespie
Value




Value (from Customer’s Perspective)
 Sum of benefits we receive from a product
Value (from Seller’s Perspective)
 Profits…but also, prestige, pride, making community happy
 Lifetime value of a customer
 How much is this customer worth to us in the long-term?
 Long-term thinking  develop relationships with customers
Value (to Shareholders)
 Created when company has competitive advantage over rivals
 Distinctive competency (company’s superior capability)
 Differential benefit (unique benefit of product)
Value (to Society)
 What is the impact of product/service on society?
The Marketing Mix
Product Strategies
(what will we produce
and for whom?)
Place Strategies
(where will we deliver
product/service?)
Marketing Mix
Price Strategies
(what will we charge?)
Promotion Strategies
(how will we inform and encourage
customers to buy our product?)
Why Study Marketing?


Plays an Important Role in Society

Promotes efficient transfer of desired products to meet needs

Can be used to promote worthwhile social causes
Fundamental to the Success of Businesses


Great Career Opportunities


Assessing needs, designing products, pricing product, promoting
products, distribution strategies, servicing customer
Roughly 25-33% of people perform marketing related activities
Marketing Affects You Everyday

Become a wiser consumer
The Dark Side of Marketing


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Illegal practices like “bait and switch”
Societal health problems
 Diabetes, heart disease, cancer, alcoholism, domestic violence
Psychological Costs
 Many ads encourage us to feel bad about ourselves
Financial Burdens
 Consumer debt
Environmental degradation and resource depletion
Ethics in Strategic Market Planning

Unethical business decisions impact all stakeholders
 Job
loss
 Environmental effects

Most times unethical decisions
do not go unnoticed
 Enron
 Martha
Stewart
 Sub-prime mortgage meltdown
Preventing Unethical Activities

Business ethics
 Underlying
values and philosophies that dictate actions
in an organization
 The ethical culture of an organization

Code of ethics
 Written
standards of behavior to which everyone in the
organization must subscribe
Three Levels of Business Planning

Strategic Planning


Functional (Marketing) Planning
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Managerial decision process matching an organization’s
resources and capabilities to its market opportunities for
long-term growth
Decision process that develops detailed short-term
strategies that support an organization’s strategic plans
Operational Planning

Decision process that develops detailed day-to-day
strategies that carry out an organizations functional plans
Strategic Planning

Five steps to strategic planning
 Step
1: define the mission
 Step 2: situational analysis
 Step 3: set organizational or strategic business unit
objectives
 Step 4: establish the business portfolio
 Step 5: develop growth strategies
Step 1: Define the Mission

Mission Statement

Formal statement in an organization’s strategic plan that
describes overall purpose of the organization and what it
plans to achieve in terms of customers, products, resources

Too narrow = marketing myopia

Too broad = no direction

Could have one for each Strategic Business Unit (SBU)

Individual units in the firm that operate like separate businesses,
each with its own mission, objectives, resources, managers, &
competitors
Mission Statements

Washington State University


As a public, land-grant and research institution of distinction,
Washington State University enhances the intellectual,
creative, and practical abilities of the individuals, institutions,
and communities that we serve by fostering learning, inquiry,
and engagement.
Starbucks

Establish Starbucks as the premier purveyor of the finest
coffee in the world while maintaining our uncompromising
principles while we grow.
Creating a Mission Statement
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
In groups, pretend you are opening a new chain of
Mexican – Chinese fusion restaurants in the Pacific
Northwest
Create a mission statement for your new concept
restaurant
Step 2: Situational analysis
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Internal Environment

Controllable elements in organization
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People, corporate culture, facilities, processes
External Environment

Uncontrollable elements outside organization that
may affect performance

Both positive and negative
SWOT Analysis
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Internal analysis
Strengths
 Weaknesses

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External analysis
Opportunities
 Threats


What would a SWOT analysis for The Coug look like?
Step 3: Set Organizational or SBU
Objectives
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Objectives flow from the mission statement
Organization size typically determines whether or not SBUs exist,
and if they have their own objectives
Effective objectives are
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Realistic, specific, measurable, and well-matched with mission statement
Example


Ok: Our objective is to better serve customers
Better: Our objective is to obtain customer satisfaction ratings of at least
90% in 2011, and retain at least 85% of our 2010 customers as repeat
customers in 2011
Step 4: Establish the Business Portfolio

Portfolio


Collection of brands or units owned by organization
that have different income generating potential
Portfolio Analysis

Evaluating an organization’s business mix and
assessing the potential of an organization’s SBUs
BCG Growth-Market Share Matrix
Product is dominant
in category
Product is a miss
17
Step 5: Develop Growth Strategies
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BCG matrix does not address how to grow SBUs, but the Product-Market Growth
Matrix does
Market penetration strategies

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Market development strategies
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Strategies that introduce existing products into new markets
Product Development Strategies

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Designed to increase sales of existing products to current customers, nonusers, and users of
competitors
Strategies that focus on selling new product to existing markets
Diversification Strategies

Strategies that emphasize both new products and new markets
Product-Market Growth Model
New market
(customers)
=No
New market
(customers)
=Yes
Market penetration
Product development
Seek to increase sales of
existing products to existing
markets
Create growth by selling new
product in existing markets
Examples ???
Examples ???
Market development
Diversification strategies
Introduce existing products
to new markets
Emphasize both new
products and new markets to
achieve growth
Examples ???
Examples ???
New product =No
New product =Yes
Which Quadrant of the ProductMarket Growth Matrix is This?
Which Quadrant of the ProductMarket Growth Matrix is This?
Which Quadrant of the ProductMarket Growth Matrix is This?
Which Quadrant of the ProductMarket Growth Matrix is This?
Functional (Marketing) Planning

Decision process that develops detailed short-term
strategies that support an organization’s strategic plans
 Step
1: perform a situational analysis
 Step 2: set marketing objectives
 Step 3: develop marketing strategies
 Step 4: implement and control the marketing plan
Step 3: Develop Marketing Strategies

Select a Target Market


Market opportunity analysis – size and sales
potential of target group, and assessment of key
competitors
Develop Marketing Mix Strategies

Product, Price, Promotion, Place of Distribution
Step 4: Implement and Control the
Marketing Plan
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Action Plans

Implementation of marketing strategies
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Responsibilities, Time Line, Budget, Measurement and Control
Control

Monitoring progress

Compare actual performance to marketing objectives and adjust
strategy/objectives as needed
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Must have good marketing metrics
Marketing audits

Evaluation of objectives, strategies, structure, performance of
marketing organization

Should be comprehensive, systematic, independent, periodic