Session 3 Marketing Management BBA Section C

1. Part 1: Understanding Marketing Management > Marketing & Customer Value > Corporate and Division Strategic Planning > Business Unit Strategic Planning > Product Planning: The Nature and Contents of a Marketing Plan Class Presentation | Session 3 | 16 Aug 2010

2. Marketing & Customer ValueThe Value Delivery Process MG 220 Marketing Management 2

3. Marketing & Customer ValueThe Value Delivery Process MG 220 Marketing Management 3

4. Marketing & Customer ValueThe Value Chain A tool for identifying ways to create more customer value Every firm is a synthesis of activities performed to design, produce, market, deliver and support its product Primary Activities (producing & marketing) Support Activities (management of firm) MG 220 Marketing Management 4

5. Marketing & Customer ValueThe Value Chain Firm should estimate its competitors’ costs and performances as ‘benchmarks’ against which it compares its own costs and performance Success depends on ‘core business processes’ Market sensing Offering realization Customer Acquisition Customer Realization Fulfillment management MG 220 Marketing Management 5

6. Marketing & Customer ValueThe Value Chain MG 220 Marketing Management 6

7. Marketing & Customer ValueCore Competences Outsource the less critical Focus on Core Competency Characteristics of Core Competency: A Source of competitive advantage Has Application in a wide variety of markets Difficult for competitors to imitate MG 220 Marketing Management 7

8. Marketing & Customer ValueA Holistic Marketing Orientation & Customer Value MG 220 Marketing Management 8 Customer Company Partners Designing Developing Delivering

9. Marketing & Customer ValueThe Central Role of Strategic Planning All the successful brands: Focus on Customers Respond effectively to changing customer needs Have well-staffed marketing departments And all other departments in their organizations understand: “CUSTOMER IS THE KING” MG 220 Marketing Management 9

10. Marketing & Customer ValueThe Central Role of Strategic Planning Levels in Strategic Planning [Typical] Corporate Level Division Level Business Unit Level Product Level Marketing Plan is central instrument for directing and coordinating marketing effort Strategic marketing plan Lays out target markets & value proposition Tactical marketing plan Specifics of marketing activities MG 220 Marketing Management 10

11. Marketing & Customer ValueThe Central Role of Strategic Planning MG 220 Marketing Management 11

12. Corporate & Division Strategic PlanningActivities Four Planning Activities Defining the Corporate Mission Establishing Strategic Business Units Assigning Resources to each SBU Assessing Growth Opportunities MG 220 Marketing Management 12

13. Corporate & Division Strategic Planning1. Defining the Corporate Mission Peter Drucker’s classic questions What is our business? Who is the customer? What is of value to our customer? What will our business be? What should our business be? MG 220 Marketing Management 13

14. Corporate & Division Strategic Planning1. Defining the Corporate Mission (…contd.) Mission Statements Focus on LIMITED goals Stress company’s major policies & values Define the major competitive spheres: Industry (in which company operates) Products & Applications Competence Market Segment Vertical (channels) Geographical MG 220 Marketing Management 14

15. Corporate & Division Strategic Planning2&3. Defining Business / Establishing SBUs A business is? Customer-satisfying process NOT: Goods-producing process MG 220 Marketing Management 15

16. Corporate & Division Strategic Planning2&3. Defining Business / Establishing SBUs (…contd) A SBU: Single business or collection of related businesses which can be planned from the rest of the company It has its own set of competitors It has a manager who is responsible for strategic planning and profit performance and who controls most of the factors affecting profit MG 220 Marketing Management 16

17. Corporate & Division Strategic Planning4. Assessing Growth Opportunities Strategic Planning Gap MG 220 Marketing Management 17

18. Corporate & Division Strategic Planning4. Assessing Growth Opportunities (…contd) Intensive Growth Ansoff Product-Market Expansion Grid MG 220 Marketing Management 18

19. Corporate & Division Strategic Planning4. Assessing Growth Opportunities (…contd) Integrative Growth ‘Integrations’ Backward: Acquire Suppliers Forward: Acquire distributors/suppliers Horizontal: Acquire Competitors MG 220 Marketing Management 19

20. Corporate & Division Strategic Planning4. Assessing Growth Opportunities (…contd) Diversification Growth When good opportunities can be found outside current business New line of business NOT products Downsizing & Divesting Pruning & harvesting current portfolio MG 220 Marketing Management 20

21. Business Unit Strategic PlanningProcess MG 220 Marketing Management 21

22. Business Unit Strategic PlanningSWOT Analysis SWOT Internal Environment Analysis Strengths Weaknesses External Environment Analysis Opportunities Threats MG 220 Marketing Management 22

23. Business Unit Strategic PlanningGoal Formulation Setting objectives & MBO Managing by Objectives Goals should have these characteristics They must be arranged hierarchically from the most to least important Objectives should be stated quantitatively whenever possible Goals should be realistic Objectives must be consistent MG 220 Marketing Management 23

24. Business Unit Strategic PlanningStrategic Formulation Goals: What a business wants to achieve Strategy: A game plan for getting there Porter’s Generic Strategies Overall Cost Leadership Differentiation Focus Strategic Alliances Product or Service Alliances (licensing to produce its product) Promotional Alliances (joint promotions) Logistics Alliances Pricing Collaborations (mutual price discounts) MG 220 Marketing Management 24

25. Business Unit Strategic PlanningProgram Formulation & Implementation Great Marketing Strategy can fail: If poorly implemented Strategy is one the seven elements in business practice! (McKinsey) Strategy Structure Systems Style Skills Staff Shared Values MG 220 Marketing Management 25

26. Business Unit Strategic PlanningFeedback & Control Need to track results and monitor new developments Need to continuously examine changing environment and to adopt to new goals and behaviors MG 220 Marketing Management 26

27. Product Planning: Marketing PlanNature Marketing Plan A written document that summarizes what the marketer has learned about the marketplace and indicates how the firm plans to reach its marketing objectives MG 220 Marketing Management 27

28. Product Planning: Marketing PlanContents Executive Summary & Table of Contents Situation Analysis Marketing Strategy Financial Projections Implementation Controls MG 220 Marketing Management 28

29. Part 2: Capturing Market Insights > Gathering Information & Scanning the environment > Key Concepts in complete Chapter 3 will be covered Class Presentation | Session 4 | 18 Aug 2010