Chapter 2 Planning Implementing and Evaluating Marketing Strategies 2 1 The Strategic Planning Process Strategic Planning a company establishing an organizational mission and formulating goals corporate strategy marketing objectives and a marketing strategy 1 Organization establishes missions and goals 2 Develops strategies to achieve goals 3 Organization analyzes strengths and weaknesses identifies opportunities and threats 4 Each subgroup marketing finance HR etc establish their own objectives 2 1A Establishing Organizational Mission Statements and Goals Missions Statement a long term view or vision of what the organization wants to become Corporate Identity the symbols personalities and philosophies of a company 2 1B Developing Corporate and Business Unit Strategies Top down and bottom up planning are important bottom up becoming more popular Three levels of strategy 1 Corporate determines the means for utilizing resources for sub departments finance marketing HR etc 2 Business Unit 3 Marketing a Strategic Business Unit SBU a division product line or other profit center within the parent company ie Kraft s SBU is dairy products and snack foods Market a group of individuals and or organizations that have needs for products in a product class and have the ability willingness and authority to purchase those prodcuts Market Share the percentage of a market that actually buys a specific product from a particular company is that company s market share Cash Cows have a dominant share of the market but low prospects of growth Bounty paper towels Dogs subordinate share and low prospects of growth CD Players Questions Marks small share of a growing market and generally require large amount of cash to build market share Stars products with dominant share of the market and good prospects for growth however they use more cash than they generate to finance growth Wii 2 1C Assessing Organizational Resources and Opportunities Core Competencies things a company does extremely well that can provide an advantage over competition Market Opportunity when the right combination of circumstances and timing permits an organization to take action to reach a particular target market Strategic Windows temporary periods of optimal fit between the key requirements of a market and the particular capabilities of a company competing in that market Competitive Advantage when a company matches a core competency to opportunities strategic windows it gains a competitive advantage SWOT Analysis o Strengths internal competitive advantages core competencies that provide advantages in meeting the needs of the target market o Weaknesses internal limitations of an organization at developing strategy o Opportunities external favorable conditions that can produce rewards if acted on properly objectives o Threats external conditions or barriers that may prevent a company from reaching its First Mover Advantage the ability of an innovative company to achieve long term competitive advantages by being the first to offer a certain product in the marketplace o Initially free of competition o Helps establish brand loyalty o Allows protection of products innovations through patents o High costs from R D production and marketing o High risk of product not catching on Late Mover Advantage the ability of later market entrants to achieve long term competitive advantages by not being the first to offer a certain product in the marketplace they learn from first mover mistakes o Lower initial investment o More certainty o Legally limited by first mover patents o Loss of consumers to first movers 2 1D Developing Marketing Objectives and Marketing Strategies Marketing Objective states what is to be accomplished through marketing activities o Product introduction improvement sales volume profitability pricing etc o Should be clear and simple o Should be written and measurable o Should be consistent with business unit and corporate strategy Marketing Strategy the selection of a target market and the creation of a market mix that will satisfy the needs of target market members Sustainable Competitive Advantage one that the competition cannot copy in the foreseeable future ie Walmart 2 2 Managing Marketing Implementation Marketing Implementation the process of putting marketing strategies into action 2 2A Organizing the Market Unit Centralized Organization top level managers delegate little authority to lower levels Decentralized Organization decision making authority is delegated as far down the chain of o More traditional approach command as possible o More quickly responds to customer needs better for marketing age 2 2B Motivating Marketing Personnel Rewards for employees should be tied to the organization s goals Rewards can be in the form of raises or pay bonuses or in the form of recognition or prestige 2 2C Communicating Within the Marketing Unit Poor communication can harm morale and reduce productivity Important communication that flows up the chain of command from the frontline managers employees 2 2D Coordinating Marketing Activities Marketing managers can improve coordination by making each employee aware of how his or her job relates to others and how his or her actions contribute to the achievement of marketing objectives 2 2E Establishing a Timetable for Implementation Establishing an implementation timetable involves several steps Identifying the activities to be performed 1 2 Determining the time required to compelte each activity 3 Separating the activities to be performed in sequence from those to be performed 4 Organizing the activities in the proper order 5 Assigning responsibility for completing each activity into one or more employees teams simultaneously or managers 2 3 Evaluating Marketing Strategies Strategic Performance Evaluation consists of establishing performance standards measuring actual performance comparing actual performance with established standards and modifying the marketing strategy if needed 2 3A Establishing Performance Standards Performance Standard an expected level of performance against which actual performance can be compared o Must be specific ie sales quota of 150 00 or 10 increase per month in customer accounts etc 2 3B Analyzing Actual Performance o Sales Analysis o Costs Analysis Evaluating the actual performance of marketing strategies can be measured in two ways Sales Analysis uses sales figures to evaluate a firm s current performance o Most common method readily available data o Can
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