All rights reserved. Debbie Thorne McAlister.

Strategic Marketing Planning

Dr. Debbie Thorne McAlister

Learning Focus

Process of marketing planning Components of marketing plan Purposes and uses of marketing plan Common mistakes in marketing planning

Planning Can Be Like Boot Camp…You’ll Hate It.

Only Later Will You Realize It Was Good for You -- and for Business.

Source: Leo Helzel and friends, A Goal is a DreamWith a Deadline, 1995.

Detailed formulation of the actions needed to carry out the marketing program

An action document:– The handbook for marketing implementation,

evaluation and control Not the same as a business plan Requires a great deal of information from

many different sources

The Marketing Plan

Two Purposes of Marketing Plan

Align people and departments for the successful implementation of the plan

Gain support and budget necessary to implement the plan

Organizational Mission vs. Organizational Vision (1 of 2)

Elements of the Mission Statement– Five basic questions to be answered:

» Who are we?» Who are our customers?» What is our operating philosophy?» What are our core competencies or

competitive advantages?» What are our concerns and interests related to

our employees, our community, society in general and our environment?

Organizational Mission vs. Organizational Vision (2 of 2)

Mission Width and Stability– Width: Too broad or too narrow?– Stability: Frequency of modifications

Customer-Focused Mission Statements– Ben and Jerry’s 3-part Mission Statement

» Product Mission

» Economic Mission

» Social Mission

– Tylenol

Business-Unit Strategy:– The central means for:

» Utilizing and integrating the organization’s resources

» Carrying out the organization’s mission

» Achieving the organization’s desired goals and objectives

– Associated with developing a competitive advantage– Determines the nature and future direction of each

business unit– Essentially the same as corporate strategy in small

businesses

Corporate or Business-Unit Strategy

Exhibit 2.1

All business functions must support the organization’s mission and goals.

Functional objectives should be expressed in clear, simple terms.

All functional objectives should be reconsidered for each planning period.

Functional Goals and Objectives

Functional strategies are designed to integrate efforts focused on achieving the area’s stated objectives.

The strategy must:– (1) Fit the needs and purposes of the functional area– (2) Be realistic with the organization’s resources and

environment– (3) Be consistent with the organization’s mission

goals, and objectives. The effects of each functional strategy must be

evaluated.

Functional Strategy

Involves activities that execute the functional strategy.

Functional plans have two target markets:– (1) External market

– (2) Internal market A company must rely on its internal market

for a functional strategy to be implemented successfully.

Implementation

Designed to keep activities on target with goals and objectives

Coordination among functional areas is a critical issue– Open lines of communication is the key

Evaluation and control is both an ending and beginning:– Occurs after a strategy has been implemented– Serves as the beginning point for planning in the next

cycle

Evaluation and Control

A Market-Oriented Organization:– Shifts its focus:

» From products to the requirements of market segments» From transactions to relationships» From competition to collaboration

– Puts customer’s needs and wants first– Focuses on long-term, value-added relationships– Instills a corporate culture that puts customers at the

top of the organizational hierarchy– Cooperates with suppliers and competitors to serve

customers better

Strategic Planning in theMarket-Oriented Organization

Principles of Marketing Planning

Strategy first, operations second Marketing is an attitude, not a set of

procedures SWOT should be focused on critical

customers and competitors Make planning appropriate for culture and

top management’s support Create a rigorous marketing audit

Delta Pull-Out Spray Faucet

Delta Faucet Co. Delta Pull-Out Spray

Faucet helped push firm’s market share in that category up from 1.6% to 23.2% in two years

$227.15 - $294.30

Should be well organized A good marketing plan outline is:

– Comprehensive

– Flexible

– Consistent

– Logical

Marketing Plan Structure (1 of 5)

Marketing Plan Structure

Exhibit 2.3

I. Executive Summary– Synopsis of the overall marketing plan– Introduces major aspects of the marketing plan

II. Situation Analysis– Summarizes information about 3 key environments:

» Internal environment» Customer environment» Firm’s external environment

Marketing Plan Structure (2 of 5)

III. SWOT Analysis– Strengths– Weaknesses– Opportunities– Threats– Analysis of the SWOT matrix– Establishing a strategic focus

Marketing Plan Structure (3 of 5)

IV. Marketing Goals and Objectives:– Formal statements of desired and expected outcomes

of the marketing plan– Goals:

» Broad, simple statements of what is to be accomplished

– Objectives» More specific and essential to planning

V. Marketing Strategy:– Primary target market and marketing mix– Secondary target market and marketing mix

Marketing Plan Structure (4 of 5)

VI. Marketing Implementation– 1. What specific marketing activities will be undertaken?– 2. How will these activities be performed?– 3. When will these activities be performed?– 4. Who is responsible for the completion of these activities?– 5. How will the completion of planned activities be monitored?– 6. How much will these activities cost?

VII. Evaluation and Control– Formal marketing control– Informal marketing control– Financial assessments

Marketing Plan Structure (5 of 5)

Tips for using the marketing plan framework to develop a marketing plan:– Plan ahead– Revise, revise, revise– Be creative– Use common sense and judgment– Think ahead to implementation– Update regularly– Communicate with others

Using the Marketing Plan Structure

A good marketing plan will:– (1) Explain both the present and future situations of

the organization– (2) Specify the outcomes that are expected– (3) Describe the specific actions that are to take place– (4) Identify the resources that will be needed– (5) Permit the monitoring of each action and its

results Communicating the strategy to top executives is

paramount.

Purposes and Significanceof the Marketing Plan

Frequent Mistakes in the Planning Process

Speed and length of process Amount of data Who develops the plan Frequency of process Who sees the plan

Problems in Developing and Implementing the Marketing Plan

Exhibit 2.4

How Do Employees Receive Guidance for Marketing and Branding?Verbal 37%

Email/Phone no. link to central resource 13%

Printed 15%

CD 3%

Online (pdf) 5%

Online (html) 6%

Rely entirely on agency 19%

Source: www.brandchannel.com

Nike’s Triax 250 Sport Watch Series Designer: Astro Studios and

Nike Nike’s first brand extension

from running shoes into watches

Nike now sells nearly 2 million watches a year generating $100 million annually

$85 - $130

Revising Hawaii’s Tourism Plan

Governor Linda Lingle visited Japan to encourage tourism, down 30% after September 11, SARS, and Iraq.

One tactic related to the popularity of hula in Japan and Hawaii as its birthplace.

Island of Oahu was most affected by the downturn, since this is where many Japanese travel.

Product Failures: Remember These?

Why Does Planning Fail?

1) The failure to have a plan, or to successfully communicate it to others.

2) Elevating the imperative to grow to a level that includes sacrificing differentiation and competitive advantage.

3) The failure to position the enterprise in the marketplace and establish a brand.

4) The failure to understand market saturation and the law of diminishing returns.

5) The failure to manage change.

6) The failure to have a contingency plan and to act upon it.

7) The failure of leadership to lead and make hard choices. Source: Strategic Chronicle, Summer 2003

How Marketing Strategy Affects Business PerformanceHow Marketing Strategy Affects Business Performance

Share-holder Value

Cash Flow for Earnings

FinancialPerformance

Market Performance(market share, revenue per customer)

Customer Satisfaction, Retention,and Purchase Behavior

Marketing Strategy and Strategy Implementation

Linking Market-Based Assets to Shareholder Value

Market Performance

Faster Market Penetration

•Faster Trial

•Faster Adoption

Price Premium

Share Premium

Extensions

Loyalty

Market-Based Assets

Customer Relationships:

•Brands

Partner Relationships:

•Channels

•Branding

•Network

Shareholder Value

Accelerate Cash Flows

Enhance Cash Flows

Reduce Volatility and Vulnerability of Cash Flows

Enhance Residual Value of Cash Flows

Questions: Why are many corporate icons having trouble? Why are many

jobs being lost? Why are CEOs being fired?

Answer: Bad strategy in an increasingly unforgiving and

competitive marketplace.Source: Jack Trout, Capturing Mindshare, Conquering Markets, 2004.