Introduction to Marketing Strategy & PlanningDr Al MarshallACUSchool of Business

LECTURE AGENDADefining Strategy & PlanningBenefits of Strategic Orientation & PlanningLink With Wider Strategy & Planning Characteristics of the Strategic Market Planning ProcessOutcome of the ProcessMarketing Plan DefinitionLevels of a Marketing Plan Components of the Marketing PlanChecklist for Plan FundamentalsBroad Bases for Strategy

Defining Strategy & PlanningSetting a path for the organisation in the future to achieve its corporate objectivesUsing marketing to achieve these objectivesCombinations of marketing elements or building blocks (e.g. 4Ps) to achieve theseEngaging in planning processes to identify the optimal strategies and how these will be implementedMonitoring the implemented strategies in real time and real space and adjusting to change

Benefits of Strategic Orientation & Planning (1)Marketing management can become proactive rather than reactive in the marketplaceEnables marketing activities and processes to be more fully integrated under a set agreed directionStrategy can be communicated within the organisation and to key stakeholdersProvides a benchmark for implementation of strategy to be checked against and adjustments made as plan is implementedOrganisation has to look externally as well as internallyDraw on knowledge about the marketplace (both formal and informal)

Benefits of Strategic Orientation & Planning (2)

See where the organisation is presently going and could be goingForces organisation to take a longer term view and see different ways of how to get thereMakes visible resource allocation decisionsMore fully understand assets, competencies and sources of competitive advantage

http://www.youtube.com/watch?v=Gu2ImfIjN7o

The Link With Wider Strategy & PlanningStrategic market planning takes its lead from corporate strategy and plansOther business disciplines/functional units also engage in similar processesMust reflect corporate mission, objectives, strategy, plans (a subset of these)All about the contribution that marketing as a function can makeMarketing is subject (either informally or formally) to KPI measures within the organisation

Characteristics of the Strategic Market Planning ProcessRequires formalised process to consider present and possible future strategyProcess can be extended and involve group interaction among the marketing teamFamiliarity with corporate mission, objectives, strategy, plans necessaryCan be undertaken for a product, product group, a market segment or whole organisationThe process is point in time (with subsequent set or rolling reviews)Classically a five year time period (but variable)

Outcome of the ProcessA formal marketing plan agreed to by upper management which sets out marketing strategy for set future time periodsA commitment to allocation of human and financial resources to marketing activitiesThe implementation of the plan in the marketplace, with tactical adjustments made as necessary to cope with environmental changeCertainty about how marketing will be carried out, and the possible value it can deliver to customers and the organisation

Marketing Plan DefinitionA marketing plan is the central instrument for directing and coordinating the marketing effort. It operates at a strategic and tactical level (Kotler & Keller)

In essence it is a tool to build and defend competitive advantage http://www.youtube.com/watch?v=bl5cyZlay4k

Levels of a Marketing PlanStrategic: Target marketing decisions, value proposition, competitive advantage, analysis of marketing opportunitiesTactical: Product features, promotion, merchandising, pricing, sales channels, service http://www.youtube.com/watch?v=S-UNhrO3jis

Components of the Marketing Plan (1)The Situation Analysis processes for analysing organisations current situation and environment (using techniques like SWOT, PEST, Porters 5 Environmental Forces Model)Review of Organisational Mission and Objectives - statement of goals, aspirations and parameters, and corporate road map for the futureSegmentation, Targeting & Positioning Analysis processes of categorising markets into segments, evaluating segments, picking target markets and positioning products to them

Components of the Marketing Plan (2)Marketing Mix Review processes to evaluate product, pricing, marketing channel and communications elements, as well as people, physical infrastructure etc (using techniques like Kotlers 3 Levels of Product, Gap Analysis)Future Strategic Alternatives Consideration processes to consider viable alternative marketing strategy directions and to select an optimal choice (using techniques like BCG Matrix, GE Matrix, Ansoffs Growth Strategies Matrix)

Components of the Marketing Plan (3)Implementation & Control Consideration processes to consider Action Plans (how plan will be implemented), Sales Forecasts (sales expected), Budgets (finances allocated) & Controls (evaluation checks and feedback loops if the plan is implemented)Agreement by marketing management and signoff by upper management who check fit with corporate mission, objectives, strategy, plans http://www.youtube.com/watch?v=-ul65NjOMzo

Checklist for Plan Fundamentals

Is the plan simple?Is the plan specific?Is the plan realistic?Is the plan complete?

ALSO Is it consistent with corporate strategy and plans? (and with other functional unit strategy and plans)

Broad Bases for StrategyAccording to Porter (1980): - Overall cost leadership involves the organisation winning market share by appealing to cost-conscious or price-sensitive customers. Achieved by having the lowest prices in the target market segment, or at least the lowest price to value ratio. Example - Walmart - Differentiation involves the organisation differentiating its products in some way in order to compete successfully. Appropriate where the market is not price-sensitive, is competitive or saturated, customers have very specific needs (possibly under-served). Example - Apple - Focus involves the organisation choosing to either compete in the mass market with a broad scope, or in a defined, focused market segment with a narrow scope. In either case, the basis of competition will still be either cost leadership or differentiation