Chapter 2 Class Notes

Chapter 2 Notes Contents

• Introduction
• Strategic Market Planning
• SWOT Analysis
• Mission Statement
• Organizational Goals
• Corporate Strategy
• Marketing Planning
• Marketing Management
• Please Email alex@udel.edu any comments
• Return to Syllabus
• Return to Homepage

Introduction

We will look at an overview of the strategic marketing process including the development of:

• SWOT Analysis
• Mission Statement
• Organizational Goals
• Corporate Strategy
• Marketing strategy

The process of strategic market planning yeilds a marketing strategy(s) that is the framework and the development of the marketing plan.

Developing a marketing plan is your group project assignment. A marketing plan deals primarily with implementing the market strategy as it relates to target market(s) and the marketing mix.

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Strategic Market Planning

"Describes the direction [an organization] will pursue within its chosen environment and guides the allocation of resources and effort" - Peter Bennett, Dictionary of Marketing Terms, AMA 1988

Strategic planning requires a general marketing orientation rather than a narrow functional orientation.

All functional areas must include marketing and must be coordinated to reach organizational goals. It is a heirarchal process, from company wide to marketing specific. (Marketing concept, implemented from top down.)

Company wide, SBU specific

An SBU has its own strategic plan and can be considered a seperate business entity competing with other SBU's for corporate resources.

For example Pepsico Companies SBUs include:

• KFC
• Taco Bell
• Pizza Hut
• Mountain Dew
• Lipton Tea Brands
• Frito Lay

A strategic plan gives:

• Direction and better enables the company to understand mkt. function dimensions
• Makes sure that each division has clear integrated goals
• Different functional areas are encouraged to coordinate
• Assesses SW & OT
• Assesses alternative actions
• It is a basis for allocating company resources
• A procedure to assess company performance

• Develop a SWOT analysis
• Develop Mission Statement that evolves from the SWOT analysis
• Develop Corporate Objectives that are consistent with the organization's mission statement.
• Develop corporate strategy to achieve the organization's objectives. [if the organization is made up of more than one SBU, then follow loop again for each SBU, then proceed]
• Marketing (and other functional objectives) must be designed to achieve the corporate objectives
• Marketing Strategy, designed to achieve the marketing objectives.

A firm can then assess its opportunities and develop a corporate strategy. Marketing objectives must be designed so that they can be accomplished through efficient use of the firms resources.

Corporate strategy is concerned with issues such as diversification, competition, differentiation, interrelationships between business units and environmental issues. It attempts to match the resources of the organization with the opportunities and risks of the environment (SWOT). Corporate strategy is also concerned with defining the scope and roles of the SBU's of the firm so that they are coordinated to reach the ends desired.

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SWOT Analysis

• Strengths...Internal
• Weaknesses...Internal
• Opportunites...External
• Threats...External

Mission Statement

Handout Visioning Missions becomes...

Organizational goals

Goals must specify the end results that are desired, that are measurable and within a particular time frame.

SMAC

• Specific
• Measurable
• Achieveable
• Consistent

Corporate Strategy

• Scope of Business-----What Business you are in??
• Resource deployment----How you are going to use your resources??
• Competitive advantage----What are your competitive advantages??
• Coordination of Production, Marketing, Personnel etc.----
• Coordination process??

Tools for strategic market planning

• BCG Product Portfolio Management
  • Star
  • Cash Cow
  • Problem Child (Question Marks)
  • Dog
• SWOT analysis
• Product Life Cycle Concept

• Intense Growth-mkt penetration/development, product development in related markets.
  • Market Penetration...more products to the same market
  • Market Development...same product to new markets
  • Product Development...new products to same market
• Diversified Growth-new products new markets Horizontal (unrelated products to current markets)/Concentric (NPNM)
• Integrated growth Forward/Backward/Horizontal Disney's Purchase of Capital Citys/ABC, a content provider purchasing distribution

Handout Mattel Toy....

Handout Ben & Jerry's New CEO...

• Market Penetration
• Market Development
• Product Development
• Diversification

Marketing Planning.

• Duration
• Scope
• Method of Development, bottom up/top down

Marketing strategy encompasses selecting and analysing the target market(s) and creating and maintaining an appropriate marketing mix that satisfies the target market and company. A Marketing strategy articulates a plan for the best use of the organizations resources and tactics to meet its objectives. Do not pursue projects that are outside the companies objectives or that stretch the companies resources.

Plan includes:

• Executive summary
• Situation Analysis
• Opportunity and Threat Analysis
• Environmental Analysis
• Company Resources
• Marketing Objectives
• Marketing Strategies to include:
  • Target market (Intended) A target market is group of persons/companies for whom a firm creates and maintains a Marketing Mix that specifically fits the needs and preferences of that group. Does the company have the resources to create the appropriate MM and does it meet the company's objectives.
  • Develop a marketing mix-how to reach the target market. The marketing mix is designed around the buying motive-emphasizing the marketing concept. The marketing environment effects the marketing mix, which is only controllable to a certain extent (the MM). Before developing the MM, need to determine the needs of the target market.
• Financial Projections
• Controls and Evaluations

Marketing Management.