Marketing: Real People, Real Choices: Ninth Edition, Global Edition

Marketing: Real People, Real Choices
Ninth Edition, Global Edition
Chapter 3
Strategic Market
Planning
Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Learning Objectives
3.1 Explain business planning and its three levels.

3.2 Describe the steps in strategic planning.
3.3 Describe the steps in market planning.

Planning: Compose the Big Picture
• Planning is everything … almost!

• Business planning is an ongoing process that
guides short- and long-term decisions.
 Helps identify and build on firm strengths
 Improves managerial decision making
 Develops objectives and provides a means of
charting progress toward goals

Figure 3.1Three Levels of Business
Planning

Strategic Planning
• Strategic planning is the managerial process that

matches firms resources and capabilities to market
opportunities.
 Top management defines firm’s purpose and sets
objectives.
 Many large firms have separate SBUs (strategic
business units).

Strategic Business Units (SBUs)
• Large, multiproduct firms may have separate

divisions, called strategic business units (SBUs).
 SBUs operate like a separate business.
• Strategic planning is conducted at both the
corporate and SBU level.

Functional Planning
• Functional – Planning done by top functional level

management
• Market planning includes:
 Situation analysis
 Broad 3– 5 year plan to support the strategic plan
 Annual plan

Operational Planning (1 of 2)
• First-line managers focus on day-to-day execution

of functional plan.
• For marketers, this typically includes
 Annual, semi-annual, or even quarterly action plans
to guide marketing plan implementation
 Use of marketing metrics to monitor performance

All Business Planning is an
Integrated Activity
• Strategic, functional, and operational plans must be
in harmony for firm to succeed.
 Planning at all levels flows from organizational
mission.
• Planners at all levels must keep the “big picture” in
mind.

Strategic Planning: Frame the
Picture
• Strategic planning plays an important role in the
modern corporation.
 Optimize revenues across multiple lines of business.
 Minimize risk in a complex and changing global
environment.
• Includes a series of steps that results in
development of growth strategies.

Figure 3.2 Steps in Strategic
Planning

Step 1: Define the Mission
• Key questions in determining mission
 What business are we in?
 What customers should we serve?
 How should we develop the firm’s capabilities and
focus its efforts?
• A mission statement is a formal document that
describes the firm’s overall purpose and what it
hopes to achieve in terms of its customers,
products, and resources.

Mission Statements Are Important!
• Twitter’s mission statement is “To give everyone the
power to create and share ideas and information
instantly, without barriers.”
• The ideal mission statement is not too…
 Broad
 Narrow
 Shortsighted

Step 2: Evaluate the Environment
• Examination of internal and external environments
• Managers often synthesize environmental analysis
of into a format known as SWOT analysis.
 SWOT analysis catalogs firms’ internal strengths and
weaknesses and external opportunities and threats.

Internal Environment
• Internal environment
consists of controllable
elements within firm.
 Key technologies
 Patents
 Financial stability
 Supplier relationships
 Reputation
 Human capital

External Environment
• External environment consists of factors outside the
firm which that could positively or negatively impact
operations.
• Largely beyond direct management control, so
planning is critical
 Economy
 Competition
 Technology trends
 Sociocultural trends
 Legal/political/ethical trends

SWOT Analysis
• Strengths
• Weaknesses
• Opportunities
• Threats

Step 3: Set Organizational or SBU
Objectives
• Organizational goals and objectives should be direct
outgrowth of the mission statement.
 Taking into account internal and external
environmental factors
• Objectives should be specific, measureable,
attainable, and sustainable.
 May be directed toward financial- , operational- , or
customer-based criteria

Step 4: Establish Business Portfolio
• A business portfolio represents the range of

different businesses that a large firm operates.
 Disney operates multiple lines of business, including
movie studios, theme parks, cruises, etc.
• Portfolio analysis
 Assesses the growth potential for a firms SBUs and
product lines
 BCG Growth-Share Matrix

Figure 3.3 BCG Matrix
Source: Product Portfolio Matrix, © 1970, The Boston Consulting Group.

Step 5: Develop Growth Strategies
• Product-market growth matrix
 Characterizes different types of growth strategies
based on market and product types.
 Market penetration
 Market development
 Product development
 Diversification

Figure 3.4 Product–Market Growth
Matrix

Strategic Planning Summary
• Successful executives understand strategic planning
as an ongoing process.
• One that proceeds from defining a shared purpose,
leading to business growth
1. Define the mission
2. Evaluate environment
3. Set objectives
4. Establish business portfolio
5. Develop growth strategies

Market Planning: Develop and
Execute Marketing Strategy
• Effective implementation of the four Ps requires a

great deal of planning.
• Steps are similar to those in strategic planning
 Key difference relates to focus on issues relating to
marketing mix.

Figure 3.5 Steps in Market Planning

Step 1: Perform a Situation Analysis
• Analyze the marketing environment

• Conduct SWOT analysis

Step 2: Set Marketing Objectives
• Specific to the firm’s marketing mix-related elements

• Marketing objectives help achieve the overall
business objectives.

Step 3: Develop Marketing
Strategies
• Identify target market(s)

• Adjust marketing mix for
each target market
 Product
 Price
 Promotion
 Place (Distribution)

Step 4: Implement and Control the
Marketing Plan
• During implementation process, firms follow formal
process to determine progress toward marketing
objectives.
 Measure actual performance
 Compare performance to established objectives
 Make adjustments to objectives or strategies based
on this analysis

Return on Marketing Investment
(ROMI)
• Return on marketing investment
 Revenue (or profit) generated by investment in a
given marketing program divided by the cost of the
program at a given level of risk
 For instance, if:
 Revenue from Marketing Investment = $150,000
 Cost of Marketing Program = $30,000
 ROMI = 5.0

Action Plans
• Individual support plans included in a marketing plan

that provide guidance for implementation and control
of the various marketing strategies within the plan.
 Sometimes referred to as marketing programs
 Managers create actions plans for key elements
involved in implementing the marketing strategy.

Assigning Responsibility in the
Action Plan
• Who will be responsible for carrying out each part of
the marketing plan?
• Not everybody involved will be marketers
 Sales
 Production
 Quality control
 Shipping
 Customer service
 Finance
 IT

Creating Action Plan Timelines
• Each action plan requires a time line needed to

accomplish the various tasks.
• Often portrayed in flowchart form to help managers
and employees visualize sequence of tasks
 Gantt charts
 PERT charts

Setting a Budget
• Each cost element of the action plan should link to a

budget item.
 Increases accountability for all parties involved with
implementing the marketing plan
 Accuracy in estimating individual action plan
expenditures helps overall marketing budget
forecasting.

Deciding on Measurements and
Controls
• Marketing control is a formal process for:
 Measuring performance
 Comparing performance to established marketing and
strategy objectives
 Making adjustments to the objectives or strategies
based on this analysis
• Selecting the right metrics should account for short-
term objectives balanced against firm’s long-term
sustainability.

Operational Planning (2 of 2)
• Operational plans focus on day-to-day execution of
the marketing plan.
 Cover a shorter period of time than strategic and
functional plans
 Often falls to lower level managers
 Include detailed instructions for activities, specifies
responsibilities, and provides time lines
 Many key marketing metrics actually are used at the
operational level of planning.

Marketing: Real People, Real Choices: Ninth Edition, Global Edition

Uploaded by

Copyright:

Available Formats

Marketing: Real People, Real Choices: Ninth Edition, Global Edition

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Marketing: Real People, Real Choices: Ninth Edition, Global Edition

Uploaded by

Copyright:

Available Formats

Marketing: Real People, Real Choices

Ninth Edition, Global Edition

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

3.1 Explain business planning and its three levels.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Planning is everything … almost!

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Strategic planning is the managerial process that

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Large, multiproduct firms may have separate

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Functional – Planning done by top functional level

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• First-line managers focus on day-to-day execution

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• A business portfolio represents the range of

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Source: Product Portfolio Matrix, © 1970, The Boston Consulting Group.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Effective implementation of the four Ps requires a

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Analyze the marketing environment

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Specific to the firm’s marketing mix-related elements

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Identify target market(s)

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Individual support plans included in a marketing plan

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Each action plan requires a time line needed to

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

• Each cost element of the action plan should link to a

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

Copyright © 2018 Pearson Education Ltd. All Rights Reserved.

You might also like