Marketing Management Session 3 & 4

Developing Marketing Strategies and Plans

Siemens AG has grown through new product innovation and

strategic acquisitions

Nike Creates Value

Three V’s Approach to Marketing

Define the value segmentDefine the value segment

Define the value propositionDefine the value proposition

Define the value networkDefine the value network

ABN Amro’s value Proposition for its SB Accounts

• On a minimum monthly average balance of Rs.10,000 our saving bank account offers you something other savings accounts don’t:– Value for money– Free cheque pick up from your home or office– Cash delivery to your home or office(upto Rs.10,000)– Extended banking hours (9am to 4.30pm) on week-

days– Sunday banking (9am to 12 noon0– Free home delivery of pay orders and demand drafts.– Free local pay orders

– Free cheque return protection– Free metro cheque clearing– Free money transfers– Free standing instructions to pay regular bills

(like your kid’s school fees)– Account opening from your home or office.

• ABN Amro calls it the Savings Advantage Account.

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.

Cisco Systems Taps into Partner Expertise to Create Value

VALUE DELIVERY

• Standard Chartered Bank

• Godrej GE

• Virgin Atlantic

• Fedex

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

Netflix’s Distinctive Capabilities

Firms Should Consider Key Questions

• Can we learn from the past?• How should the present be evaluated?• What do we envision for the future?

What is Holistic Marketing?

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

coprosperity among key stakeholders.

Intel’s New Brand Identity: Leap Ahead

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– Target marketing

decisions– Value proposition– Analysis of marketing

opportunities

• Tactical– Product features– Promotion– Merchandising– Pricing– Sales channels– Service

The Strategic Planning, Implementation,

and Control Processes

Corporate Headquarters’ Planning Activities

• Define the corporate mission

• Establish strategic business units (SBUs)

• Assign resources to each SBU

• Assess growth opportunities

Good Mission Statements

Focus on limited number of goalsFocus on limited number of goals

Stress major policies and valuesStress major policies and values

Define major competitive spheresDefine major competitive spheres

Take a long-term viewTake a long-term view

Short, memorable, meaningfulShort, memorable, meaningful

Major Competitive Spheres

Industry

Products

Marketsegment

Geographical

CompetenceVertical

channels

Infosys Technologies Limited

“To achieve our objectives in an environmentof fairness, honesty, and courtesy towardsour clients, employees, vendors, and societyat large.”

Biocon

“To be an integrated biotechnology enterpriseof global distinction.”

eBay

“We help people trade anything on earth.We will continue to enhance the onlinetrading experiences of all—collectors, dealers, small businesses, unique itemseekers, bargain hunters, opportunitysellers, and browsers.”

Product Orientation vs. Market Orientation

Company Product Market

Xerox We make copying equipment

We improve office productivity

Columbia Pictures

We make movies We entertain people

Encyclopedia Britannica

We sell encyclopedias We distribute information

Carrier We make air conditioners and furnaces

We provide climate control inside homes

Dimensions That Define a Business

Customer groups

TechnologyCustomer

needs

Characteristics of SBUs

• It is a single business or collection of related businesses

• It has its own set of competitors

• It has a leader responsible for strategic planning and profitability

Strategies Suggested by Ansoff’s Product-Market Expansion Grid

• Market penetration

• Market development

• Product development

• Diversification

Developing the People’s Car‘TATA Nano’

What is Corporate Culture?

Corporate culture is the shared experiences, stories, beliefs, and norms

that characterize an organization.

The Business Unit Strategic Planning Process

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?

Market Opportunity Analysis (MOA) (cont.)

• 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?

FedEx added Sunday deliveries based on customer requests andmarket demand

FedEx

Porter’s Generic Strategies

Overall Cost Leadership

Differentiation

Focus

Categories of Marketing Alliances

Product or Service AlliancesProduct or Service Alliances

Promotional AlliancesPromotional Alliances

Logistics AlliancesLogistics Alliances

Pricing CollaborationsPricing Collaborations

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?

Marketing Debate

What good is a mission statement?

Take a position:1. Mission statements are critical to a successful marketing organization.or2. Mission statements rarely provideuseful marketing value.

EXERCISE

• Each student is in effect a “product”. Like all product’s you (they) must be marketed for success. Write your own “mission statement” about your career and a “goal statement” of where you see yourselves in 5 years, 10 years, and after 20 years.

Marketing Discussion

What implications do Porter’s valuechain and the holistic marketingorientation model have formarketing planning?