Developing marketing

strategies and plans

 What is the Value Chain?

The value chain is a tool for identifying ways to

create more customer value because every firm is a
synthesis of primary and support activities performed
to design, produce, market, deliver, and support its
product.
 Core Business Processes

• Market-sensing process

• New-offering realization process

• Customer acquisition process

• Customer relationship management process

• Fulfillment management process

Characteristics of Core Competencies

• A source of competitive advantage

• Applications in a wide variety of markets

• Difficult to imitate
 Holistic Marketing
Key management questions are:
•Value exploration —How a company identifies new value
opportunities?
•Value creation —How a company efficiently creates more
promising new value offerings?
•Value delivery —How a company uses its capabilities and
infrastructure to deliver the new value offerings more
efficiently?
Holistic Marketing sees itself as integrating the value
exploration, value creation, and value delivery activities
with the purpose of building long-term, mutually satisfying
relationships and co-prosperity among key stakeholders.
 What is a Marketing Plan?

A marketing plan is the central instrument for

directing and coordinating the marketing effort. It
operates at a strategic and tactical level.
 Levels of a Marketing Plan

• Strategic • Tactical
• Target • Product features
marketing • Promotion
decisions • Merchandising
• Value proposition • Pricing
• Analysis of • Sales channels
marketing
opportunities • Service
 Corporate Headquarters’
Planning Activities

• Define the corporate mission

• Establish strategic business units (SBUs)

• Assign resources to each SBU

• Assess growth opportunities

 The Corporate Mission

An organization exists to accomplish something: to make

cars, lend money, provide a night's lodging, and so on. Its
specific mission or purpose is usually clear when the
business starts. Over time the mission may change, to take
advantage of new opportunities or respond to new market
conditions.
Organizations develop mission statements to share with
managers, employees, and (in many cases) customers. A
clear, thoughtful mission statement provides employees
with a shared sense of purpose, direction, and opportunity.
 Product Orientation vs. Market Orientation

Company Product Market

Missouri-Pacific We run a railroad We are a people-
Railroad and-goods mover

Xerox We make copying We improve office

equipment productivity

Standard Oil We sell gasoline We supply energy

Columbia Pictures We make movies We entertain

people
 Good Mission Statements

• Focus on a limited number of goals

• Stress major policies and values

• Define major competitive spheres

• Take a long-term view

• Short, memorable, meaningful

 Major Competitive Spheres

• Industry

• Products

• Competence

• Market segment

• Vertical channels

• Geographic
 eBay

“We help people trade anything on earth.

We will continue to enhance the online
trading experiences of all—collectors,
dealers, small businesses, unique item
seekers, bargain hunters, opportunity
sellers, and browsers.”
 Dimensions that Define a Business

• Customer groups: (who will be served by the

business)
• Customer needs: (who will be served by the
business)
• Technology:(how are these needs going to be
met).
A major point of importance in this matrix is to focus on
understanding the customer rather than the industry and its products
and services. Through these three dimensions, this tool helps define a
business by its competitive scope (narrow or broad) and the extent of
competitive differentiation of its products/services.
ESTABLISHING STRATEGIC
BUSINESS UNITS
strategic business unit, popularly known
as SBU, is a fully-functional unit of a
business that has its own vision and
direction. Typically, a strategic business
unit operates as a separate unit, but it is
also an important part of the company. It
reports to the headquarters about its
operational status.
 Characteristics of SBUs

• It is a single business or collection of related

businesses

• It has its own set of competitors

• It has a manager responsible for strategic planning

and profitability
 Assigning Resources to Each SBU
Several investment planning models provide ways to make
investment decisions as follows:

•The GE/McKinsey Matrix classifies each SBU by the extent of

its competitive advantage and the attractiveness of its industry.
Management can decide to grow, “harvest” or draw cash from,
or hold on to the business.

•Another model, BCG’s Growth-Share Matrix, uses relative

market share and annual rate of market growth as criteria to
make investment decisions, classifying SBUs as dogs, cash
cows, question marks, and stars.
 Assessing Growth Opportunities:
Ansoff’s Product-Market Expansion Grid

• Market penetration strategy

• Market development strategy

• Product development strategy

• Diversification strategy
 Business Unit
Strategic Planning
 Business Mission
• Each business unit needs to define its specific mission
within the broader company mission. Thus, a television-
studio-lighting-equipment company might define its mission
as, “To target major television studios and become their
vendor of choice for lighting technologies that represent the
most advanced and reliable studio lighting arrangements.
 SWOT Analysis

• Strengths

• Weaknesses

• Opportunities

• Threats
 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?
• Can the company deliver the benefits better than any
actual or potential competitors?
• Will the financial rate of return meet or exceed the
company’s required threshold for investment?
 Goal Formulation
Once the company has performed a SWOT analysis, it can
proceed to goal formulation, developing specific goals for the
planning period. Goals are objectives that are specific with
respect to magnitude and time. Most business units pursue a
mix of objectives, including profitability, sales growth, market
share improvement, risk containment, innovation, and
reputation. The business unit sets these objectives and then
manages by objectives (MBO). For an MBO system to work,
the unit’s objectives must meet four criteria:
•Unit’s objectives must be hierarchical

•Objectives should be quantitative

•Goals should be realistic

•Objectives must be consistent

 Strategic Formulation:
Porter’s Generic Strategies
• Overall cost leadership. Firms work to achieve the lowest
production and distribution costs so they can underprice
competitors and win market share.
• Differentiation. The business concentrates on achieving
superior performance in an important customer benefit
area valued by a large part of the market.
• Focus. The business focuses on one or more narrow
market segments,gets to know them intimately, and
pursues either cost leadership or differentiation within the
target segment.
 Strategic Formulation :
Marketing Alliances
• Product or service alliances —One company licenses
another to produce its product, or two companies jointly
market their complementary products or a new product.
• Promotional alliances —One company agrees to carry a
promotion for another company’s product or service
• Logistics alliances —One company offers logistical
services for another company’s product.
• Pricing collaborations —One or more companies join in a
special pricing collaboration.
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?
 Thank you

By ,
Ashwani
Pranoy
Avinash
Soumesh
Manish