Lec 02 Company and Marketing Strategy.pptx

Ideal PPT

1. Marketing Principles Company and Marketing Strategy: Partnering to Build Customer Relationships Dr. Muhammad Zahid Session 2

2. Chapter Outline Companywide Strategic Planning: Defining Marketing’s Role Planning Marketing: Partnering to Build Customer Relationships Marketing Strategy and the Marketing Mix Managing the Marketing Effort Measuring and Managing Return on Marketing Investment 2-3

3. 1 Companywide Strategic Planning: Defining Marketing’s Role

4. Companywide Strategic Planning: Defining Marketing’s Role Strategic Planning Strategic planning is the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities.

5. Steps in Strategic Planning

6. Questions a Mission Statement Should Answer What is our Business? Who is the Customer? What do Consumers Value? What Should our Business Be?

7. The Mission Statement A statement of the organization’s purpose What it wants to accomplish in the larger environment Should be market oriented and defined in terms of customer needs.

8. Mission Statements Should: Be Realistic Be Specific Fit the Market Environment Be Based on Distinctive Competencies Be Motivating

9. Steps in Strategic Planning

10. Companywide Strategic Planning Setting Company Objectives and Goals

11. Companywide Strategic Planning The business portfolio is the collection of businesses and products that make up the company Current Business portfolio Future business portfolio Designing the Business Portfolio

12. The business portfolio

13. Analyzing the Current Business Portfolio Portfolio analysis is a major activity in strategic planning whereby management evaluates the products and businesses that make up the company BCG MATRICS Approach

14. Analyzing Current SBU’s: BCG Growth-Share Matrix Question Marks Low share SBUs in high growth markets Require cash to hold market share Build into Stars or phase out Stars High growth & share May need heavy investment to grow Eventually, growth will slow Relative Market Share High Low Market Growth Rate Low High ? Cash Cows Low growth, high share Established, successful SBU’s Produce cash Dogs Low growth & share Generate cash to sustain self Do not promise to be cash sources

15. Can be Difficult, Time Consuming, Costly to Implement Difficult to Define SBUs & Measure Market Share/Growth Focus on Current Businesses, Not Future Planning Can Place too Much Emphasis on Growth Problems With Matrix Approaches Can Lead to Poorly Planned Diversification

16. Companywide Strategic Planning: Defining Marketing’s Role Developing Strategies for Growth and Downsizing Product/market expansion grid is a tool for identifying company growth opportunities through market penetration, market development, product development, or diversification 2-16

17. Market Penetration Product Development Market Development Existing New P R O D U C T New M A R K E T Diversification Existing Product/Market Expansion Grid

18. Growth at Starbucks To maintain its phenomenal growth in an increasingly over-caffeinated marketplace, Starbucks has brewed up an ambitious, multi-pronged growth strategy.

19. Product/Market Expansion Grid Based on Starbucks Market Penetration : make more sales to current customers without changing products. How? Add new stores in current market areas; improve advertising, prices, menu, service. Market Development : identify and develop new markets for current products. How? Review new demographic (seniors/ethnic consumers) or geographic (Asian, European, Australian, & South American) markets.

20. Product/Market Expansion Grid Based on Starbucks Product Development : offering modified or new products to current markets. How? Add food offerings, sell coffee in supermarkets, co-brand products. Diversification : start up or buy businesses outside current products and markets. How? Making and selling CDs, testing restaurant concepts, or branding casual clothing.

21. Marketing’s Role in Strategic Planning Provide a Guiding Philosophy Provide Inputs to Strategic Planners Design Strategies to Reach Objectives

22. 2 Planning Marketing: Partnering to Build Customer Relationships

23. Partnering with Other Company Departments A value chain is a series of departments that carry out value-creating activities to design, produce, market, deliver, and support a firm’s products.

24. Value Delivery Network Company’s Value Chain Distributors Suppliers Customers

25. The Value Chain Wal-Mart’s ability to offer the right products at low prices depends on the contributions from people in all of the company’s departments—marketing, purchasing, information systems, and operations.

26. 3 Marketing Strategy and the Marketing Mix

27. Managing Marketing Strategy and Marketing Mix

28. Market Segmentation The process of dividing a market into distinct groups of buyers with different needs, characteristics, or behavior who might require separate products of marketing programs.

29. Customer-Driven Marketing Strategy A market segment is a group of consumers who respond in a similar way to a given set of marketing efforts. Target marketing is the process of evaluating each market segment’s attractiveness and selecting one or more segments to enter.

30. Market Positioning Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers. Process begins with differentiating the company’s marketing offer so it gives consumers more value.

31. Positioning Toyota’s hybrid Prius is “a revelation brilliantly disguised as a car.” The Hummer is “Like nothing else—Sport utility? Define Sport!”

32. Choose a partner and discuss some of the ways Pepsi goes about the process of positioning its products. What market segments do you think Pepsi is trying to reach? Interactive Student Assignment

33. The Marketing Mix The set of controllable, tactical marketing tools that the firm blends to produce the response it wants in the target market. Consists of the 4 P’s Product Price Place Promotion

34. The 4 P’s of the Marketing Mix

35. The 4 P’s & 4 C’s of the Marketing Mix 4 P’s - Seller’s View Product Price Place Promotion 4 C’s - Buyer’s View Customer Solution Customer Cost Convenience Communication

36. Managing Marketing Strategy and Marketing Mix

37. 4 Managing the Marketing Effort

38. Managing the Marketing Effort

39. Marketing Analysis Marketing analysis is the complete analysis of the company’s situation in a SWOT analysis that evaluates the company’s: S trengths W eaknesses O pportunities T hreats Managing the Marketing Effort

40. Marketing Analysis S trengths include internal capabilities, resources, and positive situational factors that may help to serve company customers and achieve company objectives. W eaknesses include internal limitations and negative situational factors that may interfere with company performance. O pportunities are favorable factors or trends in the external environment that the company may be able to exploit to its advantage. T hreats are unfavorable factors or trends that may present challenges to performance. Managing the Marketing Effort

41. Ask candidates For S W O T Analysis Class Activity

42. Market Planning Planning is the development of strategic and marketing plans to achieve company objectives. Marketing strategy consists of the specific strategies for target markets, positioning, the marketing mix, and marketing expenditure levels. Managing the Marketing Effort

43. Market Planning Sections of a marketing plan include: Executive summary Current marketing situation Threats and opportunities Objective and issues Action programs Budgets Controls Managing the Marketing Effort

44. Marketing Implementation Implementing is the process that turns marketing plans into marketing actions to accomplish strategic marketing objectives. Successful implementation depends on how well the company blends its people, organizational structure, decision and reward system, and company culture into a cohesive action plan that supports its strategies. Managing the Marketing Effort

45. Marketing Department Organization Functional Geographic Product Market or customer management Managing the Marketing Effort

46. Marketing Department Organization Functional organization: This is the most common form of marketing organization with different marketing functions headed by a functional specialist. Sales manager Market research manager Customer service manager New product manager Managing the Marketing Effort

47. Marketing Department Organization Geographic organization: Useful for companies that sell across the country or internationally. Managers are responsible for developing strategies and plans for a specific region. Product management: Useful for companies with different products or brands. Managers are responsible for developing strategies and plans for a specific product or band. Managing the Marketing Effort

48. Marketing Department Organization Market or customer management organization: Useful for companies with one product line sold to many different markets and customers. Managers are responsible for developing strategies and plans for their specific markets or customers. Customer management involves a customer focus and not a product focus for managing customer profitability and customer equity. Managing the Marketing Effort

49. Marketing Control Controlling is measuring and evaluating results and taking corrective action as needed. Operating control Strategic control Operating control involves checking ongoing performance against annual plan and taking corrective action as needed. Strategic control involves looking at whether the company’s basic strategies are well matched to its opportunities. Managing the Marketing Effort

50. Marketing Control Process

51. 5 Measuring and Managing Return on Marketing Investment

52. Return on Marketing Investment (ROI) Return on marketing investment (ROI) is the net return from a marketing investment divided by the costs of the marketing investment. Marketing ROI provides a measurement of the profits generated by investments in marketing activities. Measuring and Managing Return on Marketing Investment

53. Measuring and Managing Return on Marketing Investment Customer-Centered Measures Customer acquisition Customer retention Customer lifetime value 2-49