Chapter 2- slide 1 Chapter Two Company and Marketing Strategy Partnering to Build Customer Relationships

Chapter 2- slide 1

Chapter Two

Company and Marketing StrategyPartnering to Build Customer

Relationships

Chapter 2- slide 2Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

Company and Marketing Strategy

• Companywide Strategic Planning: Defining Marketing’s Role

• Designing the Business Portfolio• Planning Marketing: Partnering to Build Customer

Relationships• Marketing Strategy and the Marketing Mix• Managing the Marketing Effort• Measuring and Managing Return on Marketing

Investment

Topic Outline


Companywide Strategic Planning

Strategic planning is the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities

Strategic Planning


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Strategic Planning Process:

This process involves:– Defining a Mission: Statement of an organization’s

purpose; should be market oriented.– Setting Company Objectives: Supporting goals and

objectives to guide the entire company.– Designing a Business Portfolio: Collection of businesses

and products that make up the company.– Planning Functional Strategies: Detailed planning for

each department designed to accomplish strategic objectives.



• The mission statement is the organization’s purpose, what it wants to accomplish in the larger environment

• Market-oriented mission statement defines the business in terms of satisfying basic customer needs

Defining a Market-Oriented Mission


Characteristics of good mission statement

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Copyright 1998 Prentice Hall

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MarketOrientedMarket

Oriented

Fit Market EnvironmentFit Market

Environment

MotivatingMotivating RealisticRealistic

DistinctiveCompetencies

DistinctiveCompetencies

SpecificSpecific

Characteristicsof Good Mission

Statements

Characteristicsof Good Mission

Statements

Mission StatementsMission Statements


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Mission statement of Some Company:Prime Bank: To Build Prime Bank ltd an efficient, market

driven, customer focus institution with good corporate governance structure.

Dhaka bank: To be the premier financial institution in the country providing high quality products and services backed by latest technology and a team of highly motivated personnel to deliver Excellence in Banking

Unilever: As a responsible corporate entity, Unilever Bangladesh aims to play its part in addressing environmental and social concerns through local actions and in partnership with local government and organizations.


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Market-oriented business definition:

Product oriented definition:Product oriented definition:

1)1)We provide online serviceWe provide online service

2) We make cosmetics2) We make cosmetics

Market Oriented product definition:

We create customer connectivity,Any time any where

We sell lifestyle and self Expression ,success andStatus, memories ,Hopes and dream.



Setting Company Objectives and Goals



The business portfolio is the collection of businesses and products that make up the company

Portfolio analysis is a major activity in strategic planning whereby management evaluates the products and businesses that make up the company

Designing the Business Portfolio


Strategic business unit (SBU) is a unit of the company that has a separate mission and objectives that can be planned separately from other company businesses

• Company division• Product line within a division• Single product or brandBoston Consulting Approach:Using the Boston consulting group a companies

classifies all its SBU’s according to growth share matrix

Analyzing the Current Business Portfolio



Analyzing the Current Business Portfolio


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Growth share matrix:

A portfolio planning method that evaluates a company ‘s strategic business units in terms of their market growth share and relative maket share. SBU’s classifies as star, cash cow, question marks and dog.

As the time passes, SUB change their position in the growth share matrix. Each SBU has a life cycle. Many SBU’s start out as a question marks and moves into the star category if the successes. they later become cash cows as market growth falls, then finally die off or turn into dogs toward the end of their life cycle.


Companywide Strategic Planning:


Analyzing Current SBU’s Boston Consulting Group Approach

Analyzing Current SBU’s Boston Consulting Group Approach

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Question Marks

• High growth, low share • Build into Stars/ phase out • Requires cash to hold market share

Question Marks

• High growth, low share • Build into Stars/ phase out • Requires cash to hold market share

Stars

• High growth & share• Profit potential • May need heavy investment to grow

Cash Cows

• Low growth, high share• Established, successful SBU’s•Produces cash

Cash Cows

• Low growth, high share• Established, successful SBU’s•Produces cash

Dogs

• Low growth & share • Low profit potential

Dogs

• Low growth & share • Low profit potential

Relative Market ShareHigh Low

Mar

ket

Gro

wth

Rat

e L

ow

Hig

h



• Difficulty in defining SBUs and measuring market share and growth

• Time consuming• Expensive• Focus on current businesses, not future

planning

Problems with Matrix Approaches



Product/market expansion grid is a tool for identifying company growth opportunities through market penetration, market development, product development, or diversification

Developing Strategies for Growth and Downsizing



Developing Strategies for Growth and Downsizing Product/Market Expansion Grid Strategies



Developing Strategies for Growth and Downsizing Product/market expansion grid strategies



Market penetration is a growth strategy increasing sales to current market segments without changing the product

Market development is a growth strategy that identifies and develops new market segments for current products




Product development is a growth strategy that offers new or modified products to existing market segments

Diversification is a growth strategy through starting up or acquiring businesses outside the company’s current products and markets




Downsizing is the reduction of the business portfolio by eliminating products or business units that are not profitable or that no longer fit the company’s overall strategy



Planning MarketingPartnering to Build Customer Relationships

Value chain is a series of departments that carry out value-creating activities to design, produce, market, deliver, and support a firm’s products


Planning MarketingPartnering to Build Customer Relationships

Value delivery network is made up of the company, suppliers, distributors, and ultimately customers who partner with each other to improve performance of the entire system


Marketing Strategy and the Marketing Mix



Market segmentation is the division of a market into distinct groups of buyers who have distinct needs, characteristics, or behavior and who might require separate products or marketing mixes

Market segment is a group of consumers who respond in a similar way to a given set of marketing efforts

Customer-Driven Marketing Strategy



Market targeting is the process of evaluating each market segment’s attractiveness and selecting one or more segments to enter

Customer-Centered Marketing Strategy



Customer-Centered Marketing Strategy

Market positioning is the arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of the target consumer



Marketing mix is the set of controllable tactical marketing tools—product, price, place, and promotion—that the firm blends to produce the response it wants in the target market

Developing an Integrated Marketing Mix


Marketing Mix- The Four P’sThe marketing is the set of controllable ,tactical marketing tools that the firm blend to produce the response it wants in the target market

Marketing Mix- The Four P’sThe marketing is the set of controllable ,tactical marketing tools that the firm blend to produce the response it wants in the target market

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Target Customers

IntendedPositioning

Product“Goods-and-service”combination that a company offers a

target market

PriceAmount of moneythat consumers

have to pay to obtainthe product

Activities that persuade target

customers to buythe product

Promotion

Company activitiesthat make the

product available

Place


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• 4ps takes the seller’s view of the market , not the buyer or customer view. From the customer point of view or buyer view 4 Ps can be describe as 4Cs and 4As which are shown in the following:

4P’s 4C’s 4A’sProduct Customer solution Acceptability

Price Customer cost AffordabilityPlace Convenience AccessibilityPromotion Communication Awareness’In service marketing there is another 3P these are

PeoplePhysical evidenceProcess



Developing an Integrated Marketing Mix


Managing the Marketing Effort



Marketing Analysis – SWOT Analysis



Market Planning—Parts of a Marketing Plan



Implementing is the process that turns marketing plans into marketing actions to accomplish strategic marketing objectives

• Successful implementation depends on how well the company blends its people, organizational structure, decision and reward system, and company culture into a cohesive action plan that supports its strategies

Marketing Implementation


Managing the Marketing EffortMarketing Department Organization



• Controlling is the measurement and evaluation of results and the taking of corrective action as needed

• Operating control• Strategic control

Marketing Control


Measuring and Managing Return on Marketing Investment

Return on Marketing Investment (Marketing ROI)

Return on marketing investment (Marketing ROI) is the net return from a marketing investment divided by the costs of the marketing investment. Marketing ROI provides a measurement of the profits generated by investments in marketing activities.


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GOOD LUCK

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Chapter 2- slide 1 Chapter Two Company and Marketing Strategy Partnering to Build Customer Relationships