Company and Company and Marketing StrategyMarketing Strategy

Chapter 2Chapter 2

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Objectives

Understand companywide strategic planning Understand companywide strategic planning and its four steps.and its four steps.

Learn how to design business portfolios and Learn how to design business portfolios and develop strategies for growth and develop strategies for growth and downsizing.downsizing.

Understand marketing’s role in strategic Understand marketing’s role in strategic planning and how marketers partner with planning and how marketers partner with others.others.

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Objectives

Be able to describe the marketing Be able to describe the marketing process and the forces that process and the forces that influence it.influence it.

Understand the marketing Understand the marketing management functions, including management functions, including the elements of the marketing plan.the elements of the marketing plan.

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Known for films, Known for films, animation, theme parks animation, theme parks and customer orientationand customer orientationParks offer a variety of Parks offer a variety of attractions as well as attractions as well as cleanliness, order, and cleanliness, order, and warmthwarmth

Satisfying the Satisfying the customer is customer is everyone’s jobeveryone’s job

Disney has grown Disney has grown via diversificationvia diversification

Sales and net Sales and net income have fallenincome have fallen

cWalt Walt Disney

Discussion:Discussion: How Can Disney Recover?How Can Disney Recover?

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Disney companies

ABCABC16 cable networks16 cable networks ESPNESPN, Disney Channel, Toon Disney, , Disney Channel, Toon Disney,

SoapNET, A&E, the History Channel, SoapNET, A&E, the History Channel, LifetimeLifetime Television, Television, E! Entertainment E! Entertainment

4 TV production companies4 TV production companies8 movie production companies8 movie production companies Walt DisneyWalt Disney, , TouchstoneTouchstone Pictures, Pictures,

Hollywood Pictures, Miramax FilmsHollywood Pictures, Miramax Films

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More Disney companies

5 magazine publishing groups5 magazine publishing groups5 music labels5 music labels19 Internet groups19 Internet groupsDisney InteractiveDisney InteractiveThe Disney StoreThe Disney StoreDisney Cruise LinesDisney Cruise LinesTwo sports FranchisesTwo sports Franchises

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Strategic Planning

Strategic planning is defined as:Strategic planning is defined as: ““The process of developing and The process of developing and

maintaining a strategic fit between maintaining a strategic fit between the organization’s goals and the organization’s goals and capabilities and its capabilities and its changing marketing opportunities.”changing marketing opportunities.”

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Nervewire Video Clip

Consultants may offer valuable services and expertise during the strategic planning process.

BusinessNow

Click the picture above to play video

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Figure 2-1:

Steps in the Strategic Planning Process

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Mission statements should . . .Mission statements should . . . serve as a guide for what the organization serve as a guide for what the organization

wants to accomplish.wants to accomplish. be “market-oriented” rather than “product-be “market-oriented” rather than “product-

oriented”.oriented”. be neither too narrow, nor too broad.be neither too narrow, nor too broad. fit with the market environment.fit with the market environment. be motivating.be motivating.

Strategic Planning

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Strategic Planning

Mission statements guide the Mission statements guide the development of objectives and development of objectives and goals.goals. Objectives are developed at each level Objectives are developed at each level

in the organization hierarchy.in the organization hierarchy. Strategies are developed to Strategies are developed to

accomplish these objectives.accomplish these objectives.

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Google.comGoogle.com is one of is one of the leading Internet the leading Internet search engines. search engines.

Construct a market-Construct a market-oriented mission oriented mission statement that fits statement that fits this business.this business.

Discussion Question

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Strategic Planning

Business portfolio:Business portfolio: “the collection of businesses “the collection of businesses and products that make and products that make up the company.”up the company.” Designing the businessDesigning the business

portfolio is a key step in portfolio is a key step in the strategic planning the strategic planning process.process.

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Strategic Planning

Step 1: Step 1: Analyze the Analyze the current business current business portfolioportfolio

Step 2: Step 2: Shape the future Shape the future business portfoliobusiness portfolio

Identify strategic business Identify strategic business units (SBUs)units (SBUs)Assess each SBU:Assess each SBU: The BCG growth-share The BCG growth-share

matrix classifies SBUs matrix classifies SBUs into one of four into one of four categories using:categories using:Market growth rate Market growth rate The SBU’s relative market The SBU’s relative market

share within the market.share within the market.

Portfolio DesignPortfolio Design

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Figure 2-2:

Growth-Share Matrix

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Strategic Planning

Step 1: Step 1: Analyze the Analyze the current business current business portfolioportfolio

Step 2:Step 2: Shape the future Shape the future business portfoliobusiness portfolio

Determine the future role of Determine the future role of each SBU and choose the each SBU and choose the appropriate resource appropriate resource allocation strategy:allocation strategy: BuildBuild HoldHold HarvestHarvest DivestDivest

SBUs change positions SBUs change positions over timeover time

Portfolio DesignPortfolio Design

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Strategic Planning

Matrix approaches to formal planning Matrix approaches to formal planning share many problems:share many problems: Difficult, time-consuming, Difficult, time-consuming,

and costly to implement.and costly to implement. Focus only on current Focus only on current

businesses.businesses. Too strongly emphasize Too strongly emphasize

market share growth or market share growth or growth via diversification.growth via diversification.

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Strategic Planning

Designing the business portfolio Designing the business portfolio also involves:also involves: Developing strategies for growth by Developing strategies for growth by

identifying, evaluating, and selecting identifying, evaluating, and selecting promising new market opportunities.promising new market opportunities.

Developing strategies for downsizing Developing strategies for downsizing the business portfolio.the business portfolio.

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Figure 2-3:

Product / Market Expansion Grid

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Marketing plays a key role in Marketing plays a key role in the strategic planning process.the strategic planning process.

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Figure 2-4:

The Marketing Process

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The Marketing Process

The strategic planning The strategic planning and business portfolio and business portfolio analysis processes analysis processes help to identify and help to identify and evaluate marketing evaluate marketing opportunities.opportunities.

The purpose of the The purpose of the marketing process is marketing process is to help the firm plan to help the firm plan how to capitalize on how to capitalize on these opportunities.these opportunities.

Key ElementsKey Elements

Analyzing marketing Analyzing marketing opportunitiesopportunities

Selecting target Selecting target marketsmarkets

Developing the Developing the marketing mixmarketing mix

Managing the Managing the marketing effortmarketing effort

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The Marketing Process

Analyzing marketing Analyzing marketing opportunitiesopportunities

Selecting target Selecting target marketsmarkets

Developing the Developing the marketing mixmarketing mix

Managing the Managing the marketing effortmarketing effort

Key ElementsKey Elements The segmentation The segmentation process divides the process divides the total market into total market into market segments.market segments.

Target marketingTarget marketing chooses which chooses which segment(s) are segment(s) are pursued.pursued.

Market positioningMarket positioning for the product is for the product is then determined.then determined.

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Positioning

Market positioning is not restricted to physical goods. Identify the “competing products” of relevance to the Marble Collegiate Church.

What clear, distinctive, and desirable place in the consumer’s mind does the ad at left attempt to create?

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The Marketing ProcessCompetitor analysis Competitor analysis guides competitive guides competitive marketing strategy marketing strategy development.development.Strategy leads to tactics Strategy leads to tactics via the marketing mix: via the marketing mix: The “Four Ps” – product, The “Four Ps” – product,

price, place, promotion price, place, promotion (seller viewpoint)(seller viewpoint)

The “Four Cs” – The “Four Cs” – customer solution, cost, customer solution, cost, convenience, and convenience, and communication communication (customer viewpoint)(customer viewpoint)

Analyzing marketing Analyzing marketing opportunitiesopportunities

Selecting target Selecting target marketsmarkets

Developing the Developing the marketing mixmarketing mix

Managing the Managing the marketing effortmarketing effort

Key ElementsKey Elements

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Figure 2-5:

The Marketing Mix

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The Marketing Mix

Visit the Hill’s Pet Nutrition site.

How are the 4 C’s or the 4 P’s presented within the site?

Hill’s PetNutrition

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The Marketing Process

Marketing analysisMarketing analysis Provides information Provides information

helpful in planning, helpful in planning, implementation, and implementation, and controlcontrol

Marketing planningMarketing planning Strategies and tacticsStrategies and tactics

Marketing Marketing implementationimplementation Turns plans into actionTurns plans into action

Marketing controlMarketing control Operating controlOperating control Strategic controlStrategic control

Analyzing marketing Analyzing marketing opportunitiesopportunities

Selecting target Selecting target marketsmarkets

Developing the Developing the marketing mixmarketing mix

Managing the Managing the marketing effortmarketing effort

Key ElementsKey Elements

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Figure 2-6:

Managing the Marketing Effort