Ibahrine 7 Strategic Planning

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DevelopingMarketing Plan

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Dr. Mohammed IbahrineAmerican UNIVERSITY of Sharjah jah

COLLEGE of ARTS and SCIENCESMASS COMMUNICATIONS

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Objectives

• After studying this chapter, you will be able to: Explain the role and importance of a marketing plan. Give examples of need-satisfying and sales-target

objectives Explain the difference between objectives, strategies,

and tactics in marketing and advertising plans. Discuss the suitability of top-down, bottom-up, and

integrated marketing communications (IMC) planning Describe how marketing and advertising plans are

related Explain how to establish specific, realistic, and

measurable advertising objectives

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The Marketing Plan

• In spite of the brilliant creativity employed by BBDO in its ads for Mountair:

• Dew, the Dew story actually demonstrates that business success often depends more on careful marketing and advertising planning than on advertising creativity

• Yet, every year, companies waste millions and millions of dollars on ineffective advertising due to a woeful lack of prior planning

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The Marketing Plan

• The Importance of Marketing Planning

Since marketing typically drives a company's income, the marketing plan may well be its most important document

The marketing plan assembles all the pertinent facts about the organization, the markets it serves, and its products, services, customers, competition and so on

It forces all departments-product development, production, sales advertising, finance, transportation-to focus on the customer

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The Marketing Plan


Since marketing typically drives a company's income, the marketing plan may well be its most important document

The marketing plan assembles all the pertinent facts about the organization, the markets it serves, and its products, services, customers, competition and so on

It forces all departments-product development, production, sales advertising, finance, transportation-to focus on the customer

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The Marketing Plan


It sets goals and objectives for specified periods of time It lays out the precise strategies and tactics to achieve them

The written marketing plan must reflect the goals of top management and be consistent with the company’s mission and capabilities

Depending on its scope, the plan may be long and complex or, in the case of a small firm or a single product line, very brief

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The Marketing Plan


Formal marketing plans are typically reviewed and revised yearly, but planning is not a one-time event

It's a continuous process that includes

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The Marketing Plan

Research

Formation

Implementation

Evaluation

Review

Reformulation

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The Marketing Plan

• The Effect of the Marketing Plan on Advertising

The marketing plan has a profound effect on an organization's advertising

It helps managers analyze and improve all company operations, including marketing and advertising programs

It dictates the role of advertising in the marketing mix

It enables better implementation, control, and continuity of advertising programs

It ensures the most efficient allocation of advertising dollars

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The Marketing Plan

• The Effect of the Marketing Plan on Advertising

Successful organizations do not separate advertising plans from marketing

They view each as a vital building block for success

Companies have a choice in how they plan

Most still use the traditional top-down planning model

Some use a bottom-up model; and now, increasingly, companies are starting to use an integrated marketing communications (IMC) model

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Top-Down Marketing

• The traditional top-down marketing plan is still the most common format

• It has been used for over 30 years and fits the hierarchical organization of most companies

• It is often appropriate for companies planning to launch completely new products

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Top-Down Marketing

• As Exhibit 7-1 shows, the top-down plan has four main elements:

Situation analysis Marketing objectives Marketing strategy Marketing tactics (or action programs)

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Top-Down Marketing

• Situation analysis Situation analysis section is a factual statement of the

organization' s current situation and how it got there

It presents all the relevant facts about the company's history, growth, products and services, sales volume, share of market, competitive status, markets served, distribution system, past advertising programs, marketing research studies, company capabilities, strengths and weaknesses, and other pertinent information

To plan successfully for the future, company executives must agree on the accuracy of the data and its interpretation

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Top-Down Marketing

• Marketing objectives

The organization's next step is to determine specific marketing objectives

These must consider the amount of money the company has to invest in marketing and production, its knowledge of the marketplace, and the competitive environment

Marketing objectives follow logically from a review of the company's current situation, management's prediction of future trends, and the hierarchy of company objectives

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Top-Down Marketing


For example, corporate objectives are stated in terms of profit or return on investment, or net worth, earnings ratios, growth, or corporate reputation

Marketing objectives, which derive from corporate objectives, should relate to the needs of target markers as well as to specific sales goals

These may be referred to as general need-satisfying objectives and specific sales-target objectives

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Top-Down Marketing


To shift management's view of the organization from a producer of products to a satisfier of target market needs, companies set need-satisfying objectives

These have a couple of important purposes

First, they enable the firm to view its business broadly

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Top-Down Marketing


Second, by setting need-satisfying objectives, managers force the company to look through the customer's eyes

They have to ask "What are we planning to do for the customer?" and "What is the value of that to our customer?"

One of the best ways to define a market is to think about customer needs first and then identify the products that meet those needs

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Top-Down Marketing


The second kind of marketing objective is the sales-target objective

This is a specific, quantitative, realistic marketing goal to be achieved within a specified period of time

A sales-target objective could be phrased as "What are we planning to do for ourselves?“

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Top-Down Marketing


They may be expressed in several ways: Total sales volume Sales volume by product Market segment Customer type Market share in total or by product line Growth rate of sales volume in total or by product line Gross profit in total or by product line

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Top-Down Marketing

• Marketing strategy The marketing strategy describes how the

company plans to meet its marketing objectives

''Developing and following a strategy is what keeps you and everybody else on the same course so that you can maximize the effectiveness of your marketing.,,

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Top-Down Marketing

• Marketing strategy Marketing strategy typically involves three steps:

(1) defining the particular target markets

(2) determining the strategies positioning

(3) developing an appropriate marketing mix for each target market

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Top-Down Marketing

• Marketing strategy

A company's marketing strategy has a dramatic impact on its advertising

It determines the role and amount of advertising in the marketing mix, its creative thrust, and the media to be employed

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Top-Down Marketing


Selecting the target market In top-down marketing, the first step in strategy development is to define and select the target market, using the processes of market segmentation and research

Positioning the product The famous researcher and copywriter David Ogilvy said one of the first decisions in marketing and advertising is also the most important:

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Top-Down Marketing

How to position the product

Positioning refers to the place a brand occupies competitively in the minds of consumers

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Top-Down Marketing


Professor Ernest Martin at Virginia Commonwealth University proposes seven distinct approaches to developing a positioning strategy:

1. Product attribute--setting the brand apart by stressing a particular product feature important to consumers

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Top-Down Marketing


2. Price/quality--positioning on the basis of price or quality

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Top-Down Marketing


3. Use/application-positioning on the basis of how a product is used

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Top-Down Marketing


4. Product class-positioning the brand against other products that, while not the same, offer the same class of benefits

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Top-Down Marketing


5. Product users - positioning against the particular group who uses the product

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Top-Down Marketing


6. Product competitor - positioning against competitors, using the strength of the competitor's position to help define the subject brand

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Top-Down Marketing


7. Cultural symbol-positioning apart from competitors through the creation or use of some recognized symbol or icon

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Top-Down Marketing

• Marketing strategy We would add an eighth approach:

8. category -positioning by defining or redefining a business category

A simple way for a company to get the number one position is to invent a new product category

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Top-Down Marketing


Determining the marketing mix

The next step in developing the marketing strategy is to determine a cost-effective marketing mix for each target market the company pursues

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Top-Down Marketing


The mix blends the various marketing elements the company controls:

Product

Price

Distribution

Communications

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Top-Down Marketing

• Marketing tactics (or action programs) A company's objectives indicate where it wants to go

The strategy indicates the intended route

The tactics (or action programs) determine the specific short-term actions to be taken, internally and externally, by whom, and when

Advertising campaigns live in the world of marketing tactics

These tactics are the key to bottom-up marketing

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• strategic planning is the process of identifying a problem that can be solved with marketing communications, determining objectives, and deciding on strategies, and implementing tactics.

1. Objective—a goal you want to accomplish.

2. Strategy—means, design, or plan for accomplishing objectives.

3. Tactics—actions that execute the plan, such as how an ad is designed or written.

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• The business plan and marketing plan provide direction for advertising planning and other areas.

• The business plan may cover an SBU (strategic business unit), which is a line of products or all offerings of a brand.– The objective is profit or Return-on-Investment

(ROI).

– ROI is revenue earned above the amount invested.

– Business planning starts with a a mission statement; an expression of goals and policies.

The Business Plan

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• Business mission statement

• Research (external and internal environment analysis)

• Goal formulation

• Strategy formulation

• Tactical formulation

• Implementation

• Feedback and control

Steps in the Business Plan

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• A market situation analysis assesses the environment affecting marketing.

• Objectives are focused on sales levels and share of market.

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• Select marketing objectives• Identify threats and opportunities• Select target markets• Develop marketing strategies• Design action plans• Execute plans• Measure results/take action

Steps in the Marketing Plan

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• Advertising or IMC plan also includes objectives, strategies, and tactics (like business and marketing plan).

• The focus is on the communication program supporting a brand.

The Advertising or IMC Plan

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What is a campaign plan?

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• More tightly focused on solving a particular problem in a particular time frame.

• Includes a variety of messages carried in different media and sometimes targeted to different audiences


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• Typical campaign plan outline:

1. Situation analysis2. Key strategic campaign decisions3. Media strategy (or points of contact in an IMC plan)4. Message strategy5. Other Marcom tools used in support6. Campaign management


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Backgrounding Research and review the state of the business that is

relevant to the brand and gather all pertinent information.

A problem statement identifies the problem to be solved. SWOT Analysis

Strengths, Weaknesses, Opportunities, Threats Finding ways to address the weaknesses and threats and

leverage the strengths and opportunities. Key Problems and Opportunities

Look for communication problems that hinder successful marketing; find opportunities advertising can create or exploit.

Advertising can’t solve price, availability, or quality problems; but it can address the perception of high prices or portray limited distribution as exclusivity.

Situation Analysis

SWOT Analysis

Opportunities

Strengths Weaknesses

Threats

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• Objective—formal goal statement outlining what the message is supposed to achieve and how it will be measured.

• The six categories of effects or facets can serve as a basis for common consumer-focused objectives.

• Some objectives are tightly focused on a single effect; others require a complex set of effects.– A campaign to create brand loyalty must have both

cognitive (rational) and affective (emotional) effects, and it must move people to repeat buying (behavioral).

• Advertising is effective if it creates an impression, influences people to respond, and separates the brand from the competition.

Objectives

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• Objectives must be measurable so advertisers know if the campaign or advertising is effective.

• Five requirements of a measurable objective:– Specific effect that can be measured– A time frame– A baseline (where we are, where we begin)– The goal (realistic estimate of change to be created)– Percentage change (subtract the baseline from the goal;

divide the difference by the baseline)

• Sample objective: “The goal of this campaign is to increase customer awareness of Kodak’s digital products from 20% to 25% in 12 months.”

Measurable Objectives

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• A brand’s position its place in consumers’ minds where the product or brand stands in comparison to the competition.

• Factors that define the competitive situation:– Product features and attributes, both tangible and

intangible.• Feature analysis is used to assess features relative

to competitors’ products.– Competitive advantage is where 1) the product has

a strong feature, 2) in an area that is important to the target, and 3) where the competition is weaker.

– Differentiation is a strategy that focuses attention to product differences that distinguish the company’s product from all others in the eyes of consumers.

Positioning

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• Brand identity – Must be distinctive and familiar in terms of name, logo, colors,

typeface, design, and slogan.• Brand personality

– Human characteristics like loving, trustworthy, sophisticated.• Brand position

– The soul or essence of the brand; it stands for something that matters to consumers

• Brand image – The mental image consumers construct for a product based on

symbols and associations that customer link to a brand• Brand promise and brand preference

– Believing the promise that a brand will meet your expectations leads to brand preference

• Brand loyalty– A connection built over time that leads to repeat purchases

Brand Communication Strategy

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Insight Mining

• Finding the “a-ha” in a stack of research reports, data, and transcripts is the greatest challenge for an account planner.

• Consumer insights provide fuel for the big ideas.

• Account planners use strategic and critical thinking to interpret consumer research to find relevant consumer insights that explain why consumers will care about a brand message.

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The Communications Brief

The outcome of research reaches agency creative department in the form of communication brief (or creative brief)

Communication/Creative brief is a document that explains the consumer insight and summarizes the basic strategy decisions.

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The Communications Brief

• The brief is an outline of the message strategy that guides the creative team and helps keep its ideas strategically sound.

• The first step in the creative process, it is designed to spark creativity and serve as a springboard for ideas.

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Communications Brief Outline

1. Problem

What’s the problem that communication can solve? (establish position, increase loyalty, increase liking, etc.)

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2. Target audience

To whom Who do we want to speak? (brand loyal, heavy users, infrequent users, competition’s users, etc.)

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3. Consumer insights

What motivates the target? What are the “major truths” about the target’s relationship to the product category or brand?

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4. The brand imperatives

What are the important features and competitive advantage? What’s the position? Also, what’s the brand essence, brand personality and/or image?

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5. Communication objectives

What do we want customers to do in response to our messages? (perception, knowledge, feelings, symbolic meanings, attitudes and conviction, action)

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6. The proposition or selling idea

What is the single thought that the communication will bring to life in a provocative way?

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7. Support

What is the reason to believe the proposition?

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8. Creative direction

How can you best stimulate the desired response? How can we best say it?

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9. Media imperatives

Where and when should we say it?

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Typical Campaign Plan Outline

• Situation Analysis• • Background research• • SWOTs: strengths , weaknesses,

opportunities, threats• • Key advertising problem/s to be

solved• • Key strategic campaign decisions• • Objectives• • Target audience (or stakeholder

targets in an IMC Plan)• • Brand position: Product features

and competitive advantage• • Campaign Strategy: Key strategic

approach or marcom tool • • Media strategy (or Points of Contact

in an IMC Plan)• • Media objectives• • Media selection• • Media planning and buying: • • Vehicle selection• • Budget allocation• • Scheduling

• Message strategy• • Key Consumer Insight (Brand Relationship

Insight in IMC)• • Message objectives• • Selling premise• • Big idea• • Message design and executions• • Other marcom tools used in support• • Sales promotion• • Public relations• • Direct marketing• • Personal selling• • Sponsorships, merchandising, packaging,

point-of-purchase• • Integration Strategy (maximize synergy)• • • Campaign Management

• Evaluation of effectiveness • • Campaign Budget

Setting Objectives

The traditional advertising pyramid

Determining the Strategy

Advertising Strategy

Media Strategy

Creative Strategy

Education

Ibahrine 7 Strategic Planning