Dr Close STRATEGIC PLANNING OF MARKETING MANAGEMENT

Dr. Close STRATEGIC PLANNING OF MARKETING MANAGEMENT

Some Ideas of Marketing Traditional Approach Selling & Advertising (one part) What else? Customer Satisfaction What do you think it means? Are there any examples where you were really satisfied or not satisfied? Examples: Nordstrom, Southwest Air Marketing requires 2 or more capable parties to trade items of value. Each party may deal with the other…either accept or reject the exchange offer Marketing’s job is NOT to get rid of things produced by the firm, it is to build relationships

History of Marketing: Management Philosophies Evolution of marketing orientations: 1. Simple trade orientation (trading of simple goods) 2. Production orientation (Industrial evolution) 3. Sales orientation (emphasis on selling because of competition) 4. Marketing department orientation (when all marketing activities are under the control of one department) 5. Marketing company orientation (involves short and long run planning) ~Apple, Nike, Coke, BMW, VW, Wynn, Palms

Marketing Defined “An organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders” (AMA) Everything we do to get and keep a customer Begins with the customer Series of sales or exchanges…. a relationship

What is Marketing? Major Types of Marketing Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

Importance of Marketing Everyone needs it! (politicians, churches, resumes) What if marketing (e. g. , ads, brands) did not exist? How would your life be different in these ways? Your favorite (and not so favorite) local and global businesses that you depend on? (my crackberry…) Your shopping? Your events/social life? Your education in this (fabulous) class? Your career? Your every day life? …what if we lived like Thoreau’s character in Walden Pond …

Marketing & Society What about society/ our well-being? (Google Prof. Joe Sirgy for research on this…) Micro-macro dilemma: “What is good for the individual (or company) may not be good for society. ” Difficult questions (health care, marketing to children, tobacco, fast food) My student’s dilema… Be true to yourself.

Marketing & Society Meet Terrance. (my cat in Georgia; in Vegas) Vices are marketed and distributed everywhere (ok, so we live in Vegas…) Should they not be? (does marketing and business make you do/buy unwanted things?

Questions about Marketing Let’s debate the “Quality” issues of the system… Another side…Marketing enhances our lives Issues scholars or market proponents raise: Connects people (American Idol, Iraqi Idol) Innovation Efficiency (imagine grocery shopping without brands) Helps build relationships Provides entertainment, escape Enhances competition Provides choice/individualism opportunities What other good things do you see with marketing?

What is Strategic Planning? ù True mission of an organization is to provide value for three key constituencies ù Customers ù Employees ù Investors ù Objectives and strategies established at the top level provide context for planning in each of the divisions and departments Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

Strategic Planning and Marketing Management ù Includes all activities that lead to development of a clear organizational mission, objectives, and appropriate strategies ù Plays a key role in achieving an equilibrium between short and long term, by balancing acceptable financial performance ù Prepares for inevitable changes in markets, technology, and competition, as well as in economic and political arenas Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process ù Mission statement – In developing a mission statement, management must take into account ù Organization’s history ù Organization’s distinctive competitiveness ù Organization’s environment ù Mission statement should be ù Focused on markets rather than products ù Achievable ù Motivational ù Specific Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process ù Organizational objectives ù End-points of an organization’s mission and are what it seeks through on-going, long-run operations ù Organizational strategies ù Involves choice of major directions organization will take in pursuing its objectives Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process Sample Organizational Objectives (Manufacturing Firm) Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process ù Organizational growth based on products and markets ù Market penetration strategies ù Market development strategies ù Product development strategies ù Diversification ù Organizational strategies based on competitive advantage ù Ability to outperform competitors in providing something that the market values ù Porter suggests strategies based on cost leadership and differentiation Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process Organizational Growth Strategies Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process ù Organizational strategies based on value ù “Customer value” has become critical for marketers as well as customers ù Firms must seek to build long-term relationships with their customers by offering unique value Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process ù Choosing an appropriate strategy ù Management should select those strategies consistent with its mission and capitalize on the organization’s distinctive competencies ù Sustainable competitive advantage can be based on either the assets or skills of the organization ù Key to sustaining a competitive advantage is to continually focus and build on the assets and skills that will lead to long-term performance gains Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Planning Process ù Organizational portfolio plan ù Organizations at a particular time are a portfolio of businesses – product lines, divisions, schools ù Management must decide which businesses to build, maintain, or eliminate, or which new businesses to add ù Organizations can create strategic business units (SBUs) which could be a single product, product line, or division Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Marketing Management Process ù Complete Strategic Plan ù Facilitates development of marketing plans for each product, product line, or division of the organization ù Marketing plan serves as a subset of strategic plan Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Marketing Management Process ù Defined as “the process of planning and executing the conception, pricing, promotion, and distribution of goods, services, and ideas to create exchanges with target groups that satisfy customer and organizational objectives” Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Marketing Management Process Strategic Planning and Marketing Planning Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Marketing Management Process ù Situation analysis ù Cooperative environment ù Competitive environment ù Economic environment ù Social environment ù Political environment ù Legal environment Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Marketing Management Process ù Marketing planning ù Establishing marketing objectives ù Selecting the target market ù Developing the marketing mix Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Marketing Management Process ù Implementation and control of marketing plan ù Implementation involves putting the plan into action and performing marketing tasks according to the predefined schedule ù Controlling involves three basic steps ù Measuring results of implemented marketing plan ù Comparing results with objectives ù Making decisions on whether plan is achieving objectives ù Marketing information systems and marketing research ù Need for current, reliable, and valid information Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Plan, The Marketing Plan, and Other Functional Area Plans ù Strategic planning is a top-management responsibility ù All strategic planning has marketing implications ù Marketing objectives and strategies must be derived from the strategic plan ù Planning done in all functional areas of the organization should be derived from strategic plan Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

The Strategic Plan, The Marketing Plan, and Other Functional Area Plans Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

Appendix – Portfolio Models Portfolio Theory – Experience Curve and Resulting Profit Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

Portfolio Models – BCG Model Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

Portfolio Models – The General Electric Model Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved

Portfolio Models – The General Electric Model Mc. Graw-Hill/Irwin © 2009 The Mc. Graw-Hill Companies, All Rights Reserved