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Developing and Enacting Strategic Marketing Plans. Evans & Berman Chapter 3. Chapter Objectives. To define strategic planning and consider its importance for marketing To describe the total quality approach to strategic planning and show its relevance to marketing - PowerPoint PPT Presentation
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Developing and Enacting Strategic Marketing Plans
Evans & Berman
Chapter 3
Copyright Atomic Dog Publishing, 2002
Chapter ObjectivesTo define strategic planning and consider its importance for
marketing
To describe the total quality approach to strategic planning and show its relevance to marketing
To look at the different kinds of strategic plans and the relationships between marketing and the other functional areas in an organization
To describe thoroughly each of the steps in the strategic planning process; defining organizational mission, establishing strategic business units, setting marketing objectives, performing situation analysis, developing marketing strategy, implementing tactics, and monitoring results
To show how a strategic plan may be devised and applied
Copyright Atomic Dog Publishing, 2002
Strategic Planning is Critical A strategic business plan describes the overall
direction an organization will pursue within its environment and also guides the allocation of resources. It provides the logic that integrates the perspectives of functional departments and operating units, and points them all in the same direction.
A strategic marketing plan outlines the actions necessary, who is responsible, when and where they will be completed, and how they will be coordinated. A marketing plan is carried out within the context of a firm’s broader strategic business plan.
Copyright Atomic Dog Publishing, 2002
A Total Quality Approach
This is a process- and out-put related philosophy, striving to satisfy customers effectively. It always:
Seeks to satisfy customers Has a top management commitment Emphasizes continuous improvement Requires support from employees, suppliers, and
distribution intermediaries
Copyright Atomic Dog Publishing, 2002
The Strategic Planning Process
1. Defining
Organizational Mission
2. Establishing
SBUs
3. Setting
Marketing Objectives
4.
Performing Situation Analysis
5. Developing Marketing Strategy
6. Implementing
Tactical Plans
7. Monitoring
Results
Feedback
Copyright Atomic Dog Publishing, 2002
Step One in the Strategic Planning Process
1. Define Organizational
Mission
1. Defining Organizational
Mission
Defining the organizational mission refers to a long-term commitment to a type of business and a place in the market. It “describes the scope of the firm and its dominant emphasis and values,” based on a firm’s history, current management preferences, resources, and distinctive competence, and on environmental factors.
Copyright Atomic Dog Publishing, 2002
Step Two in the Strategic Planning Process
2. Establishing
SBUs
Each of a firm’s Strategic Business Units (SBU ) has six attributes:
• A specific target market
• Its own senior marketing executive
• Control over its resources
• Its own marketing strategy
• Clear-cut competition
• Distinct differential advantages
Copyright Atomic Dog Publishing, 2002
Step Three in the Strategic Planning Process
3. Setting
Marketing Objectives
Marketing objectives establish the firm’s goals for each SBU. Objectives are described in both quantitative terms (dollar sales, percentage profit growth, and market share), and qualitative terms (image, level of innovativeness, and industry leadership role).
Without clearly identified objectives, firms often fail.
Copyright Atomic Dog Publishing, 2002
Step Four in the Strategic Planning Process
4. Performing Situation
Analysis
The situation analysis is known as
SWOT Analysis
• Internal factors include:•Strengths•Weaknesses
• External factors include:•Opportunities•Threats
The SWOT analysis is a continuous review of a firm’s market position.
Copyright Atomic Dog Publishing, 2002
Step Five in the Strategic Planning Process
5. Developing Marketing Strategy
A marketing strategy outlines the way in which the marketing mix is used to attract and satisfy the target market.
A separate strategy is necessary for each SBU.
Four strategic planning approaches are:
• Product/Market Opportunity Matrix
• Boston Consulting Group Matrix
• General Electric Business Screen
• Porter Generic Strategy Model
Copyright Atomic Dog Publishing, 2002
Product/Market Opportunity Matrix (1)
Market
Product
New
Present
Present New
MarketPenetration Strategy
MarketDevelopment Strategy
ProductDevelopment Strategy
Diversification Strategy
Copyright Atomic Dog Publishing, 2002
Product/Market Opportunity Matrix (2)
Market
Product
New
Present
Present New
Expand sales of present products in current market by pricing, promotion, and distribution strategies
Seek greater sales of present products from new markets or new uses
Develop new or modified products to appeal to present market
Develop new products aimed at new markets
Copyright Atomic Dog Publishing, 2002
Boston Consulting Group Matrix (1)
??
Relative Market Share
IndustryGrowthRate
High Low
Low
High
Copyright Atomic Dog Publishing, 2002
?
Relative Market Share
IndustryGrowthRate
H
H L
L
IntensifyMarketingEfforts toIncreaseShare
IntensifyMarketingEffortsor Leave Market
Use Profits to Aid Growing SBUs,Maintain Position
Reduce Efforts or Divest
Boston Consulting Group Matrix (1)
Copyright Atomic Dog Publishing, 2002Copyright Atomic Dog Publishing, 2001
General Electric Business ScreenIndustry Attractiveness
Co
mp
an
y B
us
ine
ss
Str
en
gth
s
Low
Medium
High
LowMediumHigh
Harvest/ Divest
Strategy
Selectivity/ Earnings Strategy
Invest/ Grow
Strategy
Copyright Atomic Dog Publishing, 2002
Cost Leadership
Strategy
Differentiation Strategy
Cost Focus
Strategy
Differentiation Focus
Strategy
The Porter Generic Strategy Model
Competitive Advantage
Competitive Scope
Broad Target
Narrow Target
Lower Cost Differentiation
Copyright Atomic Dog Publishing, 2002
Step Six in the Strategic Planning Process
6. Implementing Tactical Plans
A tactical plan specifies the short-run actions (tactics) that a firm undertakes in implementing a given marketing strategy. It has three basic elements:
• Specific Tasks
• Time Frame
• Resource Allocation
Copyright Atomic Dog Publishing, 2002
Step Seven in the Strategic Planning Process
7. Monitoring
Results
Monitoring results compares the actual performance of a firm, SBU, or product against the planned performance for a specified period.
Successful companies often employ the following strategies to assure success:
• Continuous monitoring of performance
• Regular use of proper strategy adjustments
• Maintenance of a customer-oriented focus
• Stressing positive written and oral communication among employees and channel members.
Copyright Atomic Dog Publishing, 2002
Chapter Summary
This chapter has defined strategic planning and considered its importance for marketing.
By describing the total quality approach to strategic planning, the chapter explains its relevance to all marketing activities.
The chapter reviews the different kinds of strategic plans and the relationships between marketing and the other functional areas in an organization.
It describes each of the steps in the strategic planning process.
It describes how a strategic plan may be devised and planned.
