Dr. Saleh Alqahtani

Chapter 4Chapter 4Winning Markets ThroughWinning Markets ThroughMarket-Oriented Strategic Market-Oriented Strategic PlanningPlanningbyby

Chapter 4Chapter 4Winning Markets ThroughWinning Markets ThroughMarket-Oriented Strategic Market-Oriented Strategic PlanningPlanningbyby

Dr. Saleh Alqahtani

ObjectivesObjectives

Corporate and division strategic planingCorporate and division strategic planing Business unit planningBusiness unit planning The marketing processThe marketing process Product level planningProduct level planning The marketing planThe marketing plan

Dr. Saleh Alqahtani

Kotler on MarketingKotler on Marketing

It is more important It is more important to do what is to do what is strategically right strategically right than what is than what is immediately immediately profitable.profitable.

Dr. Saleh Alqahtani

Strategic PlanningStrategic Planning

Three Key Areas and Four Organization LevelsThree Key Areas and Four Organization Levels

Strategic marketing planStrategic marketing planTactical marketing planTactical marketing planMarketing planMarketing plan

Dr. Saleh Alqahtani

Market-Oriented Strategic Planning

Market-Oriented Strategic Planning

Objectives

Skills

Resources

Opportunities

Dr. Saleh Alqahtani

Market-Oriented Strategic Planning

Market-Oriented Strategic Planning

Objectives

Skills

Resources

Opportunities

Profitand

Growth

Dr. Saleh Alqahtani

Table 4.1: Product-Oriented versus Market-Oriented Definitions of a Business

Table 4.1: Product-Oriented versus Market-Oriented Definitions of a Business

CompanyCompany Product DefinitionProduct Definition Market DefinitionMarket Definition

Missouri-Pacific Railroad

We run a railroad We are a people-and-goods mover

Xerox We make copying equipment

We help improve office productivity

Standard Oil We sell gasoline We supply energy

Columbia Pictures We make movies We market entertainment

Encyclopaedia We sell encyclopedias We distribute Information

Carrier We make air conditioners and furnaces

We provide climate control in the home

Dr. Saleh Alqahtani

Corporate Headquarters Planning

Corporate Headquarters Planning

Define the corporate missionDefine the corporate mission Establish strategic business units Establish strategic business units

(SBUs)(SBUs) Assign resources to SBUsAssign resources to SBUs Plan new business, downsize older Plan new business, downsize older

businessesbusinesses

Dr. Saleh Alqahtani

Strategic-Planning, Implementation, and Control Process

Strategic-Planning, Implementation, and Control Process

Measuringresults

Diagnosingresults

Takingcorrective

action

ImplementationImplementationPlanningPlanning

Corporateplanning

Divisionplanning

Businessplanning

Productplanning

Organizing

Implementing

ControlControl

Dr. Saleh Alqahtani

Good Mission Statements:Good Mission Statements:

Limited number of goals

Stress major policies & values

Define competitive scopes

Dr. Saleh Alqahtani

Business Unit Strategic Planning

Business Unit Strategic Planning

Business MissionBusiness Mission SWOT AnalysisSWOT Analysis

External Environment Analysis (Opportunity External Environment Analysis (Opportunity and Threat Analysis)and Threat Analysis) Marketing OpportunityMarketing Opportunity

Buying opportunity more convenient or Buying opportunity more convenient or efficientefficient

Meet the need for more information and Meet the need for more information and adviceadvice

Customize an offering that was Customize an offering that was previously only available inpreviously only available in standard standard formform

Dr. Saleh Alqahtani

The Boston Consulting Group’s Growth-Share Matrix

The Boston Consulting Group’s Growth-Share Matrix

20%-20%-18%-18%-16%-16%-14%-14%-12%-12%-10%-10%- 8%-8%- 6%-6%- 4%-4%- 2%-2%- 00M

arke

t G

row

th R

ate

3 ?Question marks

? ??21

Cash cow

6

Dogs

8

710x 4x 2x 1.5x 1x 10x 4x 2x 1.5x 1x

Relative Market Share.5x .4x .3x .2x .1x .5x .4x .3x .2x .1x

Stars

5

4

Dr. Saleh Alqahtani

Market Attractiveness: Competitive- Position Portfolio Classification

Market Attractiveness: Competitive- Position Portfolio Classification

MA

RK

ET

AT

TR

AC

TIV

EN

ES

SM

AR

KE

T A

TT

RA

CT

IVE

NE

SS

5.005.00

3.673.67

2.332.33

1.001.00

Lo

wL

ow

Med

ium

Med

ium

Hig

hH

igh

Reliefvalve

Flexiblediaphragms

Fuelpumps

Aerospacefittings

Clutches

Hydraulicpumps

Joints

StrongStrong MediumMedium WeakWeakBUSINESS STRENGTHBUSINESS STRENGTH

1.001.002.332.333.673.675.005.00

Invest/growInvest/grow Selectivity/earningsSelectivity/earnings Harvest/divestHarvest/divest

Dr. Saleh Alqahtani

Three Intensive Growth Strategies: Ansoff’s Product/Market Expansion Grid

Three Intensive Growth Strategies: Ansoff’s Product/Market Expansion Grid

4. Diversification2. Marketdevelopment

Newmarkets

1. Marketpenetration

Existingmarkets

Existingproducts

3. Productdevelopment

Newproducts

Dr. Saleh Alqahtani

The McKinsey 7-S FrameworkThe McKinsey 7-S Framework

SkillsSkills

Sharedvalues

Sharedvalues

StaffStaff

StyleStyle

StrategyStrategy

StructureStructure

SystemsSystems

Dr. Saleh Alqahtani

The Marketing PlanThe Marketing Plan

Executive Summary & Table of Contents

Current Marketing Situation

Opportunity & Issue Analysis

Objectives

Marketing Strategy

Action Programs

Projected Profit-and-loss

Controls

Dr. Saleh Alqahtani

Competitors

Marketingintermediaries

PublicsSuppliers

Factors Influencing Company Marketing Strategy

Mar

ketin

g

info

rmat

ion

syst

em

Marketing

planningsystem

Marketing

organization

system Mar

ketin

g

orga

niza

tion

and

impl

emen

tatio

n

Product

Promotion

Place PriceTargetcustomers

Demographic/Demographic/economiceconomic

environmentenvironment

Social/Social/culturalcultural

environmentenvironment

Technical/Technical/physicalphysical

environmentenvironment

Political/Political/legallegal

environmentenvironment