Developing Marketing

Strategies and Plans

Prepared By,Mr. Nishant Agrawal

Value Delivery ProcessValue creation and delivery sequence into following phases:

1. Assessing market opportunity and customer value which involve

environment scanning and developing insights about customer needs and

want

2. Choosing the value includes critical decisions to STP which essence / core

strategic marketing.

3. Designing value relates to decision involving product strategy, new offering

and pricing

4. Delivering value focuses on distribution and access issues.

5. Communicating value through integrated marketing communication ,

choosing among the various choice in mass and personalized media.

What is the Value Chain?The value chain is a tool for identifying was to create more customer value because every firm is a

synthesis of primary and support activities performed to design, produce, market, deliver, and

support its product.

Primary Activities

1. Inbound logistics

2. Outbound Logistics

3. Operations (converting material into final products)

4. Marketing includes sales

5. Service

Support Activities:

1. Procurement

2. Technology Development

3. HRM

4. Firm infrastructure

Core Business ProcessesMarket-sensing processNew-offering realization processCustomer acquisition processCustomer relationship management

processFulfillment management process

Core Competencies

Many textile , chemical and computer firm do not manufacturer their own product because offshore manufacturers are more competent.

They focus on product design and development and marketing their core competencies.

Characteristics of Core Competencies

1.A source of competitive advantage and make significant contribution to perceived customer benefits.

2.Applications in a wide variety of markets3.Difficult for competitors to imitate / copy

What is Holistic Marketing?

Holistic marketing sees itself as integrating the value exploration,

value creation, and value delivery activities with the purpose of

building long-term, mutually satisfying relationships

Holistic marketer succeed by managing a superior value chain that

deliver high level of product quality, service and speed.

They achieve profitable growth by expanding customer value,

building customer loyalty.

What is a Marketing Plan?

A Marketing plan is the central instrument for directing and

coordinating the marketing effort.

It operates at a Strategic and Tactical level.

Levels of a Marketing Plan

StrategicTarget marketing

decisionsValue propositionAnalysis of

marketing opportunities

TacticalProduct featuresPromotionPricingSales channelsService

Corporate Headquarters Planning Activities

All corporate HQ undertake four planning activities:

1. Define the corporate mission2. Establish strategic business units (SBUs)3. Assign resources to each SBU4. Assess growth opportunities

Define the Corporate Mission

Good mission statement have 5 characteristics:

1. Focus on a limited number of goals

2. Stress major policies and values

3. Define major competitive spheres

4. Take a long-term view

5. Short, memorable and meaningful

Rubbermaid Commercial Products, Inc.

“Our vision is to be the Global Market ShareLeader in each of the markets we serve. We will earn this leadership position by providing to our distributor and end-user customers innovative, high-quality, cost-effective and environmentally responsible products. We will add value to these products by providing legendary customer service through our Uncompromising Commitment to Customer Satisfaction.”

Motorola

“The purpose of Motorola is to honorablyserve the needs of the community by providingproducts and services of superior quality at a fair price to our customers; to do this so as toearn an adequate profit which is required forthe total enterprise to grow; and by doing so, provide the opportunity for our employees andshareholders to achieve their personal objectives.”

eBay

“We help people trade anything on earth.We will continue to enhance the onlinetrading experiences of all—collectors, dealers, small businesses, unique itemseekers, bargain hunters, opportunitysellers, and browsers.”

Table 2.3 Product Orientation vs. Market OrientationCompany Product Market

Missouri-Pacific Railroad

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

Xerox We make copying equipment

We improve office productivity

Standard Oil We sell gasoline We supply energy

Columbia Pictures We make movies We entertain people

Establish strategic business units (SBUs)

Characteristics of SBUs

SBU is a profit centre which focuses on product offering and

market segment.

It is a single business or collection of related businesses that can

be planned separately from rest of the company

It has its own set of competitors

It has a leader responsible for strategic planning and profitability

, who controls most of the factors affecting profit.

Assign Resources to each SBU

Once it has defined SBU management must decide how to

allocate corporate resource to each.

Several portfolio planning models provides ways to make

investment decisions.

BCG’s growth share matrix use relative market share and annual

rate of market growth as criteria to make investment decision.

Assess / Review Growth OpportunitiesIt includes planning new business and terminating older business.

If there is a gap between future desired sales and projected sales,

corporate management will need to develop or acquire new business

How can it fill strategic planning gap ?

Identify opportunities for growth within current business

(Intensive opportunities)

Identify opportunities to build business related to current business

(Integrative opportunities)

Identify opportunities to add attractive unrelated business

(diversification opportunities)

What is Corporate Culture?

Strategic planning happen within context of organization. A

company’s organization consists of its structures , policy and

corporate culture.

Corporate culture is the “shared experiences, stories, beliefs,

and norms that characterize an organization”

Whereas manager can change structure and policies but the

company’s culture is very hard to change.

Business Unit Strategic Planning

Each business unit needs to specific mission within the broader

company mission.

SWOT Analysis

Strengths

Weaknesses

Opportunities

Threats

Market Opportunity Analysis (MOA)

Can the benefits involved in the opportunity be articulated / spoken

convincingly / credibly to a defined target market?

Can the target market be located and reached with cost-effective

media and trade channels?

Does the company possess or have access to the critical capabilities

and resources needed to deliver the customer benefits?

Market Opportunity Analysis (MOA) (cont.)

Can the company deliver the benefits better than

any actual or potential competitors?

Will the financial rate of return meet or exceed the

company’s required threshold for investment?

Goal Formulation and Manages for Objective

Once SWOT analysis performed ,it can proceed to goal formulation,

developing specific goals for planning period.

For Manages for Objective system to work , unit’s objective must

meet four criteria :

1. They must be arranged hierarchically from most least to important

2. Objectives should be quantitative ( Increase ROI)

3. Goals should be realistic

4. Objectives must be consistent

Porter’s Generic Strategies Overall cost leadership

Firm work to achieve lowest production and distribution cost so

they win market share. This is achieved by having the lowest prices

in the target market segment,

first dimension is achieving a high asset utilization.

second dimension is achieving low direct & indirect operating costs

The third dimension is control over the value chain

Disadvantage of lower customer loyalty, as price-sensitive

customers will switch once a lower-priced substitute is available

Differentiation

The business concentrate on achieving superior performance in an

important customer benefit area value by large part of market. The

firm seeking quality leadership. Ex. Make Product with best

component

A differentiation strategy is appropriate where the target customer

segment is not price-sensitive, the market is competitive or

saturated.

Differentiation strategy is not suitable for small companies. It is more

appropriate for big companies.

These could include patents or unique technical expertise

Focus The business focuses on one or more narrow market segment, get to

know , differentiation within target market.

In adopting a narrow focus, the company ideally focuses on a

few target markets

The firm typically looks to gain a competitive advantage through

product innovation

Categories of Marketing Alliances

Product or service alliance Ex. Citibank credit card + Jet Airways

Promotional alliance Ex. Macdonal’s + Pepsi

Logistics alliances

Pricing collaborations Ex. Hotel + rental Car

Marketing Plan Contents Page No: 54

Executive summary Table of contents Situation analysis Marketing strategy Financial projections Implementation controls

Assignments1. Explain the basic philosophies of marketing.2. Discuss the four corporate strategic planning activities

with a suitable example3. Create a marketing plan for a product/ service of your

choice.4. Explain the steps of marketing plan 5. Explain the nature and scope of marketing management6. What is marketing management? Explain different

marketable entities with suitable examples.7. What is Managing Holistic Marketing Organization? Explain

in detail