MKT646 CH 2 Strategic Planning and Marketing Plan 2019

TOPIC 2
Developing Marketing
Strategies and Plans
1 © Pearson Education South Asia Pte Ltd 2013. All rights reserved
Planning in Marketing Organizations
• Strategic planning is a business’s process of defining

its strategy (or direction), and making decisions on allocating
its resources to pursue this strategy.
• Most large companies consist of four organizational levels:
i. Corporate level.
ii. Division level.
iii. Business unit level.

iv. Product level.
SIME DARBY GROUP
WIPRO UNZA GROUP Safi Sdn. Bhd.’s Product Lines:
1. Skincare
Brands: • Safi Rania Advanced Corrector
• Aiken • Safi Rania Gold
• Elite • Safi Balqis Oxywhite
• Eversoft Skinz • Safi Natural
• Romano • Safi Fruity Fresh
• Carrie Junior • Safi Fair Beauty
• Enchanteur • Safi Men
• Gervenne 2. Personal Care
• Safi >>>>>>>>>> • Safi Shampoo
• Dashing • Safi Toothpaste
• Eversoft • Safi Balqis White Trilogy
• New & Trendy • Safi Talcum
• Sumber Ayu • Safi Deodorant
• Safi Hair Cream & Gells
Figure 2.1: The Strategic Planning, Implementation,
and Control Processes
Corporate and Division Strategic Planning
All corporate headquarters undertake four planning activities:
i. Defining the corporate mission.
ii. Establishing strategic business units (SBUs).
iii. Assign resources to each SBU.
iv. Assessing growth opportunities.
1. Planning Activity -Defining the Corporate Mission
Key questions to ask in defining the corporate mission:
A. What is our business?
B. Who is the customer?
C. What is of value to the customer?
D. What will our business be?
E. What should our business be?
Purpose of Mission Statements:
• Organizations develop mission statements to share with

managers, employees, and (in many cases) customers.
• A clear, thoughtful mission statement provides employees

with a shared sense of purpose, direction, and
opportunity.
Amazon’s mission is to be
the world’s largest online
store.
Defining the Market
• A target market definition tends to focus

on selling a product or service to a current
market.
• Pepsi could define its target market as

everyone who drinks carbonated soft
drinks, and competitors would therefore be
other carbonated soft drink companies.
• A strategic market definition, however,

also focuses on the potential market.
2. Planning Activity –Establish Strategic Business
Units
 An SBU has three characteristics:
 It is a single business, or a collection of related

businesses, that can be planned separately from the rest of
the company.
 It has its own set of competitors.
 It has a manager responsible for strategic planning and profit
performance, who controls most of the factors affecting profit.
The purpose of identifying the company’s strategic business

units is to develop separate strategies and assign
appropriate funding.
3. Planning Activity -Assigning Resources to Each
SBU (BCG Growth-Share Matrix)
4. Planning Activity –Assessing Growth Opportunities
(The ANSOFF’s Product Market Expansion Grid)
Figure 2.3: Business Unit Strategic Planning
Business Mission and SWOT
The Business Mission

Each business unit needs to define its specific mission within the
broader company mission.
SWOT @ TOWS Analysis

The evaluation of a company’s strengths, weaknesses, opportunities,
and threats is called SWOT analysis. It involves monitoring the
external (OT) and internal (SW)marketing environment.
External Environment (Opportunity and Threat)
Analysis
• A business unit must monitor key macro-environment
forces and significant micro-environment factors that
affect its ability to earn profits.
• It should set up a marketing intelligence system to track

trends and important developments and any related
opportunities and threats.
• Good marketing is the art of finding, developing, and profiting

from these opportunities.
Environmental Threats
• An environmental threat is a challenge posed by an

unfavorable trend or development
• that would lead, in the absence of defensive marketing

action, to lower sales or profit.
• Threats should be classified according to seriousness and

probability of occurrence.
• See the Threat Matrix in Figure 2.4. p. 54
Internal Environment (Strengths and Weaknesses)
Analysis
• It is one thing to find attractive opportunities and another to
be able to take advantage of them.
• Each firm must evaluate its internal strengths and

weaknesses.
• See the Marketing Memo: Checklist for Performing Strengths

and Weaknesses Analysis (p. 54).
Checklist for Assessing Strengths and Weaknesses
Goal Formulation
• Once the company has performed a SWOT analysis, it can

proceed to develop specific goals for the planning period.
This stage of the process is called goal formulation.
• Managers use the term “goals” to describe objectives that

are specific with respect to magnitude and time:
1. They must be arranged hierarchically, from the most to least
important.
2. Objectives should be stated quantitatively whenever possible.
3. Goals should be realistic.
19 4. Objectives must be consistent.

© Pearson Education South Asia Pte Ltd 2013. All rights reserved
Strategy Formulation
• Goals indicate what a business unit wants to achieve;

strategy is a game plan for getting there.
• Every business must design a strategy for achieving its goals,

consisting of a marketing strategy and a compatible
technology strategy and sourcing strategy.
Porter’s Generic Strategies
1. Overall cost leadership—The business work hard to achieve the
lowest production and distribution costs so that it can price lower
than its competitors and win a large market share. Firms pursuing
this strategy must be good at engineering, purchasing,
manufacturing, and physical distribution.
2. Differentiation—The business concentrates on achieving superior

performance in an important customer benefit area valued by a
large part of the market.
3. Focus—The business focuses on one or more narrow market

segments. The firm gets to know these segments intimately
and pursues either cost leadership or differentiation within the
target segment.
Program Formulation and Implementation
• A great marketing strategy can be sabotaged by poor

implementation.
• Marketing must estimate its costs.
• In implementing strategy, companies must not lose sight of the

multiple stakeholders involved and their needs.
Feedback and Control
• As it implements its strategy, the firm needs to track the

results and monitor new developments.
• A company’s strategic fit with the environment will inevitably

erode because the market environment changes faster than
the company’s 7 Ss.
• Organizations are subject to inertia and are set up as efficient

machines and it is difficult to change one part without
adjusting everything else.
Product Planning: The Nature and Contents of a
Marketing Plan
• Working within the plans set by the levels above them,
product managers come up with a marketing plan for
individual products, lines, brands, channels, or
customer groups.
• Each product level (product line, brand) must develop a

marketing plan for achieving its goals.
• A marketing plan is a written document that

summarizes what the marketer has learned about the
marketplace and indicates how the firm plans to reach
its marketing objectives.
Marketing Plan Contents
 Executive summary
 Table of contents
 Situation analysis
 Marketing strategy
 Financial projections
 Implementation controls
The Marketing Plan
• The marketing plan -central instrument for directing and

coordinating the marketing effort.
• The marketing plan operates on two levels: strategic and

tactical.
A. The strategic marketing -target markets and the value

proposition.
B. The tactical marketing plan -product, promotion,

merchandising, pricing, sales channels, and service.
Marketing Plan Contents (1)
1. Executive summary and table of contents—The marketing

plan should open with a brief summary of the main goals
and recommendations.
2. Situation analysis—This section presents relevant

background data on sales, costs, the market, competitors,
and the various forces in the macro-environment. How is the
market defined, how big is it, and how fast is it growing?
What are the relevant trends and critical issues? All this
information is used to carry out on a SWOT (strengths,
weaknesses, opportunities, and threats) analysis.
3. Marketing strategy—Here the product manager defines the

mission, and marketing and financial objectives.
The manager also defines those groups and needs which the
market offerings are intended to satisfy as well as its competitive
positioning. All this is done with inputs from other organizational
areas, such as purchasing, manufacturing, sales, finance, and
human resources.
4. Financial projections—Financial projections include a sales

forecast, an expense forecast, and a break-even analysis.
– On the revenue side, the projections show the forecasted sales

volume by month and product category.
– On the expense side, the projections show the expected costs

of marketing, broken down into finer categories.
– The break-even analysis shows how many units must be sold

monthly to offset the monthly fixed costs and average per-unit
variable costs.
5. Implementation controls—The last section of the

marketing plan outlines the controls for monitoring and
adjusting the implementation of the plan.
– Typically, it spells out the goals and budget for each month or
quarter, so management can review each period’s results and
take corrective action as needed.
– Some organizations include contingency plans.
The Role of Research
• As the plan is put into effect,

marketers use research to measure
progress toward objectives and
identify areas for improvement.
• Marketing research helps marketers

learn more about their customers’
requirements, expectations,
perceptions, satisfaction, and
loyalty.
The Role of Relationships
• Marketing plans also affects both internal and external
relationships:
A. First, it influences how marketing personnel work with
each other and with other departments to deliver value and
satisfy customers.
B. Second, it affects how the company works with suppliers,

distributors, and partners to achieve the plan’s
objectives.
C. Third, it influences the company’s dealings with other

stakeholders, including government regulators, the
media, and the community at large.

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TOPIC 2

• Strategic planning is a business’s process of defining

• Most large companies consist of four organizational levels:

ii. Division level.

iii. Business unit level.

All corporate headquarters undertake four planning activities:

i. Defining the corporate mission.

ii. Establishing strategic business units (SBUs).

iii. Assign resources to each SBU.

iv. Assessing growth opportunities.

Key questions to ask in defining the corporate mission:

A. What is our business?

B. Who is the customer?

C. What is of value to the customer?

D. What will our business be?

E. What should our business be?

• Organizations develop mission statements to share with

• A clear, thoughtful mission statement provides employees

• A target market definition tends to focus

• Pepsi could define its target market as

• A strategic market definition, however,

 It is a single business, or a collection of related

The purpose of identifying the company’s strategic business

The Business Mission

SWOT @ TOWS Analysis

• It should set up a marketing intelligence system to track

• Good marketing is the art of finding, developing, and profiting

• An environmental threat is a challenge posed by an

• that would lead, in the absence of defensive marketing

• Threats should be classified according to seriousness and

• See the Threat Matrix in Figure 2.4. p. 54

• Each firm must evaluate its internal strengths and

• See the Marketing Memo: Checklist for Performing Strengths

• Once the company has performed a SWOT analysis, it can

• Managers use the term “goals” to describe objectives that

2. Objectives should be stated quantitatively whenever possible.

3. Goals should be realistic.

19 4. Objectives must be consistent.

• Goals indicate what a business unit wants to achieve;

• Every business must design a strategy for achieving its goals,

2. Differentiation—The business concentrates on achieving superior

3. Focus—The business focuses on one or more narrow market

• A great marketing strategy can be sabotaged by poor

• Marketing must estimate its costs.

• In implementing strategy, companies must not lose sight of the

• As it implements its strategy, the firm needs to track the

• A company’s strategic fit with the environment will inevitably

• Organizations are subject to inertia and are set up as efficient

• Each product level (product line, brand) must develop a

• A marketing plan is a written document that

• The marketing plan -central instrument for directing and

• The marketing plan operates on two levels: strategic and

A. The strategic marketing -target markets and the value

B. The tactical marketing plan -product, promotion,

1. Executive summary and table of contents—The marketing

2. Situation analysis—This section presents relevant

3. Marketing strategy—Here the product manager defines the

4. Financial projections—Financial projections include a sales

– On the revenue side, the projections show the forecasted sales

– On the expense side, the projections show the expected costs

– The break-even analysis shows how many units must be sold

5. Implementation controls—The last section of the

– Some organizations include contingency plans.

• As the plan is put into effect,