MARKETING MANAGEMENT12th edition2 Developing Marketing Strategies and PlansKotlerKeller

Chapter QuestionsHow does marketing affect customer value?How is strategic planning carried out at different levels of the organization?What does a marketing plan include?

Figure 2.1 The Value Delivery Process

Nike Creates Value

Improving Value Delivery the Japanese Way0 customerfeedback time0 product improvement time0 setup time0 defects0 purchasing time

3 Vs Approach to MarketingDefine the value segmentDefine the value propositionDefine the value network

Figure 2.2 Porters Value Chain

BenchmarksOrganizational costs and performance measuresCompetitorcosts and performance measures

Core Business ProcessesMarket sensingFulfillmentmanagementCustomer acquisitionNew offering realizationCustomer relationship management

Wal-Marts stock replenishment process is legendary

Characteristics of Core Competencies

A source of competitive advantageApplications in a wide variety of marketsDifficult to imitate

Netflixs Distinctive Capabilities

Figure 2.3 A Holistic Marketing Framework

Challenges Facing CMOsDoing more with lessDriving new businessdevelopmentBecoming a full business partner

Levels of a Marketing PlanStrategicTarget marketing decisionsValue propositionAnalysis of marketing opportunitiesTacticalProduct featuresPromotionMerchandisingPricingSales channelsService

Figure 2.4 The Strategic Planning, Implementation, and Control Processes

Corporate headquarters planning activitiesDefine the corporate missionEstablish SBUsAssign resources to each SBUAssess growth opportunities

Good Mission StatementsFocus on limited number of goalsStress major policies and valuesDefine major competitive spheres

Major Competitive SpheresIndustryProductsMarketsegmentGeographicalCompetenceVerticalchannels

GEs breakthroughs in the process of desalination crosses multiple competitive spheres

By 2015, two-thirds of the world will be water-stressed. Desalination plants like this one help to relieve water shortages.

Rubbermaid Commercial Products, Inc.Our vision is to be the Global Market Share Leader 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.

MotorolaThe 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.

eBayWe 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 2.2 Product Orientation vs. Market Orientation

Dimensions That Define A BusinessCustomer groupsTechnologyCustomer needs

Characteristics of SBUsIt is a single business or collection of related businessesIt has its own set of competitorsIt has a leader responsible forStrategic planningProfitabilityEfficiency

Figure 2.5 The Strategic Planning Gap

Figure 2.6 Ansoffs Product-Market Expansion Grid

The Growth of Starbucks

OrganizationsStructurePoliciesCulture

Merging Corporate Culture?

Figure 2.7 The Business Unit Strategic Planning Process

SWOT AnalysisStrengthsWeaknessesOpportunitiesThreats

Market Opportunity Analysis (MOA)Can the benefits involved in the opportunity be articulated convincingly 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)_2Can the company deliver the benefits better than any actual or potential competitors?Will the financial rate of return meet or exceed the companys required threshold for investment?

FedExFedEx added Sunday deliveries based on customer requests andmarket demand

Figure 2.8 Opportunity Matrix

Figure 2.8 Threat Matrix

Goal Formulation and MBORequirements for using MBOUnits objectives must be hierarchicalObjectives should be quantitativeGoals should be realisticObjectives must be consistent

Porters Generic StrategiesOverall Cost LeadershipDifferentiationFocus

The Star Alliance

Categories of Marketing AlliancesProduct or Service AlliancesPromotional AlliancesLogistics AlliancesPricing Collaborations

Feedback and Control

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

Evaluating a Marketing Plan Is the plan simple? Is the plan specific? Is the plan realistic? Is the plan complete?

Marketing DebateWhat good is a mission statement?

Take a position:Mission statements are critical to a successful marketing organization.2. Mission statements rarely provideuseful marketing value.

Marketing DebateWhat implications do Porters valuechain and the holistic marketingorientation model have formarketing planning?