2 MARKETING STRATEGIC PLANNING

MARKETING STRATEGIC PLANNING COLLEGE OF BUSINESS ADMINISTRATION CHUNGANG UNIVERSITY MARKETING STRATEGIC PLANNING COLLEGE OF BUSINESS ADMINISTRATION CHUNGANG UNIVERSITY MARKETING STRATEGIC PLANNING COLLEGE OF BUSINESS ADMINISTRATION CHUNGANG UNIVERSITY

2 MARKETING STRATEGIC PLANNING

fit between the organizations goal and capabilities with its marketing

opportunities.

COLLEGE OF BUSINESS ADMINISTRATION

CHUNG-ANG UNIVERSITY PROF HYUNSUK SUH

The objectives of the current chapter are described.

Objectives

Understand company-wide strategic planning and its process

Learn how to design business portfolios and develop strategies for

company growth and downsizing

Describe the marketing process and the forces that influence it

0 Objectives

Why do companies need strategic planning?

What are the stages

of the strategic planning process?

How can strategic planning benefit a company?

Strategic planning, why do we need that for?

What is “Marketing Strategic Planning”?

Marketing Strategic Planning

 A managerial decision process that matches an organization’s resources and

capabilities to its market opportunities for long term growth and survival.

Solomon, 2009

 The managerial process of creating and maintaining a fit between the

organization’s objectives and resources and the evolving market opportunities.

 The goal is long-term profitability and growth.

Lamb, Hair, and McDaniel, 2009

The Process of developing and maintaining a strategic fit between the

organization’s goals and capabilities and its changing marketing opportunities.

It involves defining a clear company mission, setting supporting objectives,

designing a sound business portfolio, and coordinating functional strategies.

Kotler and Armstrong, 2010

1 Strategic Planning

Marketing Strategic Planning starts with self queries of the following.

Strategic Maketing Planning: Questions to Ask

 A written document that acts as a guidebook of marketing activities for the

marketing manager.

What is the organization’s main activity?

How will it reach its goals?

What is Strategic Maketing Planning?

The Strategic Planning Process

The planning activities occur at the business unit, product, and market levels in the following process.

Defining the

company

mission

Setting company objectives and goals

Designing the business portfolio

Planning marketing and other functional strategies

Definition of Mission Statement

The definitions for mission statement are described below.

The mission statement is a formal document that describes the organization’s

overall purpose and what it hopes to achieve in terms of its customers,

products, and resources (Solomon and Stuart)

The firm’s long-term vision based on a careful analysis of benefits sought by

present and political customers and analysis of existing and anticipated

environmental conditions (Lamb, Hair, and McDaniel)

It is a guideline for the organization’s decision making for both short and long

run and provides direction to the strategic planning and marketing planning

process (Hoffman, et al.)

A statement of the organization’s purpose – what it wants to accomplish in the

larger environment (Kotler and Armstrong)

The Characteristics of Mission Statement

Some of the characteristics of the mission statement are described in the

following.

Market Oriented : Products outdated but basic market needs last forever

Realistic : Achievable statement

Specific : Out from generalities mark specific objectives and goals

Market Environment : e.g Girl Scout

Distinctive Competency : Core competence

Motivating : Focus on the useful activities, not on profits and sales

Make employees work is important and feeling of contributing

something to someone

The mission statement is being defined as the organization’s purpose-what it wants to accomplish in the larger environment.

2 Mission Statement

Defining Organization’s Mission

Top management’s first step in the strategic planning stage is to answer such

“soul searching” questions as:

 What are the opportunities or needs that we exist to address?

(purpose of the organization)

 What are we doing to address to these needs?

(business of the organization)

 What principles or beliefs guide our work?

(values of organization)

The ideal mission statement is not too broad, too narrow, or too shortsighted.

Examples of Mission Statement

The mission statement of different companies are described below.

2 Mission Statement

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Girl Scouting builds girls of courage, confidence and character, who make the world a better place!

Example

Southwest Airlines Mission Statement

Examples of Mission Statement

More mission statements are described below.

McDonald's vision is to be the world's best quick service restaurant experience Being the best means providing outstanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile

Example

"We will prepare and sell quick service food to fulfill our guest's needs more accurately, quickly, courteously, and in a cleaner environment than our competitors We will conduct all our business affairs ethically, and with the best employees in the mid-south We will continue to grow profitably and responsibly, and provide career advancement opportunities for every willing member of our

organization."

Examples of Mission Statement

More mission statements are described below.

2 Mission Statement

Our Roadmap starts with our mission, which is enduring It declares our purpose as a company and serves as the standard against which we weigh our actions and decisions

To refresh the world

To inspire moments of optimism and happiness

To create value and make a difference

And in everything we do, we strive for honesty, fairness and integrity.

Mission Statements?

Most mission statements today contain market-oriented business themes.

We create fantasies – a place where America still works the

way it’s supposed to.

We deliver solutions to customer’s information technology

problems.

We help people experience the emotions of competition,

winning, and crushing competitors.

Space, the final frontier These are the voyages of the

starship Enterprise Its five-year mission: To explore strange

new worlds To seek out new life and new civilizations To

boldly go where no man has gone before.

To provide relief to victims of disasters and help people

prevent, prepare for, and respond to emergencies.

Example

In order for the corporate mission to be accomplished and make our customers

understood our corporate identity, both internal and external CIs be properly set.

The Composition of CIs

Slogan for Coke

1927 Around the corner from everywhere 소소 소소 소소소소

1938 The Best Friend Thirst Ever Had 같 소소 소 소소 소소 같

1942 The Only Thing Like Coca-Cola is Coca-Cola

1948 Where There's Coke There's Hospitality 소소소소 소소 소소 소소소소 소소소 같

1949 Coca-Cola Along the High Way to Anywhere 소소소소 소소소소 소소 소 소소소

1956 Coca-Cola Makes Good Thing Taste Better 코코코코 코코코 코코 코코코 코코코 코코코코 소소소

1963 Things Go Better with Coke 소소소소소 소소소소 소소 소소소

1971 I'd Like to Buy the World a Coke 소 소소소 소소소소소 소소소 소소소

1986 Coca-Cola Red, White & You 소소소소 소소소 , 소소소 , 소소소 소소

1990 Can't Beat the Real Thing 소소소 소 소소 소소소 소 소소소

The objective is a statement of what is to be accomplished through marketing

activities Setting company objectives and goals to actualize the mission statement has the following guidelines.

The Characteristics of the Organization’s Objectives are …

3 Setting Company Objectives and Goals

 Specific : Clearly Defined Outcomes

 Measurable : Quantitative Terms

 Achievable : Realistic

 Compare to Benchmark

 Time-bound : To Be Reached Within

Specific Time Frame

“Our objective is to

increase sales of Purina brand cat food by 15 percent over 2014 sales of

$300 million.”

The following examples provide a scent of how objectives be made of.

Well Stated Objectives

?

The company must analyze the current business portfolio to decide which business should receive more or less, or no investment.

Business Portfolio:

BCG-Growth/Share Matrix 1 Question marks :

Low-share business units in high-growth markets

It can be either a “Star” or “Dog”

Requires a lot of cash to hold their share

2 Stars : High-growth, high-share businesses or products Need heavy investment to finance rapid growth Eventually the growth will slow down and turn into Cash cows

3 Cash cows : Low-growth, high-share businesses or products Produce lot of cash to support other biz units Need less investment to hold the market share

Low

High

Cash Cow

Star Question Mark

Dog

?

4 Designing Business Portfolio

The BCG model suggests different strategies according to the different life cycles of the product.

Product Life Cycle and BCG Matrix

Introduction Growth Maturity Decline

Strategy 1:

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소소소소소 소소 소소 소소 소소 소 소

The GE/McKinsey model has been developed to compensate the limitations of BCG model.

Examples of GE/McKinsey Matrix

Introduction Growth Maturity Decline

?

Q UE

ST IO N

M AR K

ST AR

CASH COW

D O G

Negative Increasing Stabilized Eroding

Starting Increasing Stabilized Market Exit

SALES PROFIT COMPETI- TION

The relationship between product life cycle and its sales, profit, and competition is described below

I G M D

Product Life Cycle and Sales, Profit,

Competition

Consider the following example.

Product/Market Expansion Grid (Ansoff’s Strategic Opportunity Matrix)

Market Penetration

Market Penetration

Product Development

Product Development

Market Development

Product/Market Expansion Grid (Ansoff’s Strategic Opportunity Matrix)

McDonalds Opens Restaurants in African Cities for the

First Time

McDonalds Opens Restaurants in African Cities for the

First Time

McDonald’s Sells More Happy Meals with Disney Movie Promotions

McDonald’s Sells More Happy Meals with Disney Movie Promotions

McDonald’s Introduces Salad Shakers and McWater

McDonald’s Introduces Salad Shakers and McWater

Line of Children’s Clothing

Consider the following example.

Exercise

• 소소소소소 소소 소소소소 소소소소소 소소소 소소

• 소소 소 소 소 소소소 소소소 소소소 소 소 같

소

① 소소소 소소

② 같 소소 소소 소소소 소소 소소소 소소소 소소소 소소

③ 소소소 소소소소 소소소소 소소소 소소소 소소소 소소

Analyzing Marketing Opportunities

The business portfolio analysis help to identify and evaluate marketing opportunities.

4 Designing Business Portfolio

Example

Quality Design Features Brand name

Service Warranties

PLACE

Channels Locations Inventory Transportation Logistics

Target Customers

Intended Positioning

The marketing process can be divided into controllable and uncontrollable factors.

Technological-Natural Environment

Technological-Natural Environment

Cultural Environment

Cultural Environment

Social- Legal Environment

Legal Environment

Political- economic Environment

economic Environment

Demographic-Consider the following issues.

1 Name and describe the four product/market expansion grid strategies KFC is now

rolling out a new Kentucky Grilled Chicken line to add to its traditional fried chicken

line-up Which growth strategy does this represent?

2 Briefly discuss why management may find it difficult to dispose of a “question mark.”

3 A group of investors has purchased from an inventor the U.S rights to sell a patented, innovative mousetrap The group has hired Martha House to manage the company that includes assuming

responsibility for sales and marketing This case provides details of the marketing strategy employed

by Ms House Despite the innovativeness of the mousetrap and its success at gaining public

attention, sales are disappointingly slow Martha finds herself wondering why the world is not

beating a path to her door, as Ralph Waldo Emerson would have predicted

Martha and the investors in Trap-Ease seem to face a “once-in-a-lifetime opportunity.” What information do they need to evaluate this opportunity? What do you think the

5 Marketing Process