Marketing Management and Planning

Implementation and Control

OVERVIEW

•          Make marketing value decisions

•          Understand consumers’ value needs

•          Create the value proposition

•          Communication the value proposition

•          Deliver the value proposition 

 

Strategic Planning

•       Managerial decision process that matches firm’s resources and capabilities to its market opportunities for long-term growth and survival

Ø  Top management defines firm’s purpose and objectives

Ø  Strategic business units (SBUs) are common in large firms

Functional Planning

•       Accomplished by various functional areas of firm, such as marketing

•       Typically includes:

Ø  A broad three-to-five-year plan to support the strategic plan

Ø   A detailed annual plan

Operational Planning

•       First-line managers focus on day-to-day execution of functional plans

•       Typically includes one or more of the following:

Ø  Detailed annual plans

Ø  Semiannual plans

Ø  Quarterly plans

All Business Planning
Is an Integrated Activity

•       Strategic, functional, and operational plans must work together to benefit the whole firm

Ø  Plans are guided by firm’s mission

Ø  Planners at all levels must keep the “big picture” in mind when planning

Strategic Planning: Frame the Picture

•       Very large multiproduct firms may have divisions called strategic business units (SBUs)

Ø  SBUs operate like separate businesses

•       Strategic planning is done at both the corporate and SBU levels

Steps in Strategic Planning

Strategic Planning
Step 1: Define the Mission (1)

•       Key questions in determining the mission:

Ø  What business are we in?

Ø  What customers should we serve?

Ø  How do we develop firm’s capabilities and focus its efforts?

•       Mission statement

Ø  A formal document that describes the firm’s overall purpose and what it hopes to achieve in terms of its customers, products, and resources

•       Examples of mission statements

–      MADD: “to stop drunk driving, support the victims of this violent crime, and prevent underage drinking.”

–      National Book Swap: “to become the nation’s largest book club and in the process bring a lifetime of reading material to every American.”

Had Xerox continued to define their mission in terms of producing copy machines instead of providing “document solutions”, today’s digital age would have made their product and firm out of date.

Step 2: Evaluate the Internal
and External Environments

•       Situational analysis

Ø  An assessment of a firm’s internal and external environments

v  Internal environmental assessment: identifies the firm’s strengths and weaknesses

v  External environmental assessment: identifies opportunities and threats

External Environment

•       Elements outside the firm that may affect it either positively or negatively.

•       The external environment is global and requires consideration of:

Ø  Legal/political/ethical trends

Ø  Economic trends

Ø  Competitive trends

Ø  Technological trends

Ø  Sociocultural trends

SWOT Analysis

•       An analysis of an organization’s strengths (S) and weaknesses (W) and the opportunities (O) and threats (T) in the external environment

•       SWOT enables the firm to develop strategies that maximize strengths and capitalize upon opportunities

Step 3: Set Organizational
or SBU Objectives

•       Organizational/SBU Objectives:

Ø  What the firm hopes to accomplish with long-range business plan

Ø  Need to be specific, measurable, attainable and sustainable

Ø  May be financially focused, or focused on other factors such as satisfaction

Step 4: Establish the Business Portfolio

•       Business portfolio:

Ø  The group of different products or brands owned by a firm and having different income-generating and growth capabilities

•       Portfolio analysis             

Ø  Assesses the potential of a firm’s SBUs

Ø  BCG growth-market share matrix

Boston Consulting Group (BCG) Matrix

Step 5: Develop Growth Strategies

•       Product-market growth matrix:

Ø  Characterizes different growth strategies according to type of market and type of product

Marketing Planning

•       Step 1: Perform a situation analysis

Ø  Builds on SWOT; identifies how environmental trends affect the marketing plan

Step 2: Set marketing objectives

Ø  Specific to the firm’s brands and other marketing mix-related elements

Ø  States what the marketing function must accomplish if firm is to achieve its overall business objectives

•       Step 3 Develop marketing strategies to achieve marketing objectives

Ø  Select target market(s) where the firm’s offerings are best suited

Ø  Develop marketing mix strategies

Marketing Mix Strategies

•       Product strategies:

Ø  Include product design, packaging, branding, support services, and product variations and features

•       Pricing strategies:

Ø  Include setting prices for final consumers, wholesalers, and
retailers based on costs, demand, or competitors’ prices

•       Promotion strategies:

Ø  Advertising, sales promotion, public relations, direct marketing, personal selling

Ø  Distribution (place) strategies:

Ø  How, when, and where the product is available to targeted customers

Step 4: Implement and Control
the Marketing Plan

•       Control:

Ø  Measuring actual performance, comparing performance to the objectives, making adjustments

•       Marketing metrics:        

Ø  Return on marketing investment (ROMI)

•       Action plans:

Ø  Support plans that guide the execution and control of marketing strategies at the operational level

Implementation of the marketing plan

•       Plans are turned into actions.

•       Companies identify who, where, when and how the plan is to  be actioned.

•       Implementation links marketing strategies
with marketing performance.

Reasons for poor implementation

•       Lack of involvement by key people.

•       Environment changes.

•       Planning is unrealistic.

•       Communication of the plan and its aims are not sold effectively.

•        Resistance to change.

Operational Planning:
Day-to-Day Execution of Plans

•       At the operational level, plans focus on the day-to-day execution of the marketing plan

Ø  Created by first-line managers

Ø  Cover short time frames

Why the marketing plan may not be reliable

•       There is not one single, widely accepted structure for a marketing plan: different analysts have their own version.

•       Tactics and strategy are often mixed up.

•       Marketing plans are used to derive objectives and goals, rather than being used to achieve pre-set objectives and goals. This means that ‘following a marketing plan’ becomes an end in itself, rather than the means to achieve the desired outcomes.

•       They are often built upon wishful thinking and myopic analysis – due to erroneous beliefs that managers can control their markets.

•       Most are based upon assumptions, often perceived as ‘the truth’. Since it is hard to separate sound assumptions from faulty ones, the assumptions have to be tested and evaluated - the vulnerability of the results if the assumptions are wrong, should be assessed.

•       Companies may not evaluate and adjust their marketing plan before implementation and even afterwards because of the difficulties inherent to the ‘doing the marketing plan’ – too difficult, too much effort required, ‘don’t know how’, ‘it is going to be wrong anyway’.