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Marketing and innovation produce results: All the rest are costs.
Peter F. Drucker (19092005)
U.S. MANAGEMENT THEORIST
What is Planning?
Everyone plans. We plan which courses we want to take, which movie we want to see, and which outfit to wear to the college. We plan where we want to live and what career we want to pursue. Marketers plan as well.
What is Planning?
Planning is the process of anticipating future events and determining strategies to achieve organizational objectives in the future. Following details needs to be prepared regarding doing things:
What,Why, How, When, Who & Where
What is Planning?
Planning is a continuous process that includes identifying objectives and then determining the actions through which a firm can attain those objectives. It also defines checkpoints so that people within the organization can compare actual performance with expectations to indicate whether current activities are moving the organization toward its objectives.
Marketing Planning
Marketing planning - implementing planning activities devoted to achieving marketing objectivesestablishes the basis for any marketing strategy. Issues such as product lines, distribution channels, marketing communications, and pricing are all detailed in the marketing plan.
Marketing Plan
Marketing plan is a written document that acts as a guidebook of marketing activities for the marketing manager.
Supervisors
Developing the specific programs to meet goals in their areas of responsibility
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DEFINING THE ORGANIZATIONS MISSION AND OBJECTIVES The planning process begins with defining the firms mission
Mission- Essential purpose that differentiates one company from others. An organization lays out its basic objectives, or goals, in its complete mission statement. These objectives guide development of supporting marketing objectives and plans. Soundly conceived objectives should state specific intentions such as the following:
Generate a 12 percent profit over the next 18 months. Add 75 new outlets within the next two years.
Successful Strategies: Tools and Techniques Marketing planning tools and techniques: Porter s Five Forces model SWOT analysis First and Second mover strategies Strategic window
SWOT ANALYSIS
SWOT analysis, helps planners compare internal organizational strengths and weaknesses with external opportunities and threats. SWOT is an acronym for strengths, weaknesses, opportunities, and threats. A SWOT analysis is a method of studying organizational resources and capabilities to assess the firms strengths and weaknesses and scanning its environment to identify
SWOT ANALYSIS
A companys strengths reflect its core competencieswhat it does well. Core competencies are capabilities that customers value and competitors find difficult to duplicate.
Leverage-Matching an internal strength with an external opportunity produces a situation known as leverage. Marketers face a problem when environmental threats attack their organizations weaknesses.
SWOT ANALYSIS
STRATEGIC WINDOW
Limited periods during which the key requirements of a market and the particular competencies of a firm best fit together. The view through a strategic window shows planners a way to relate potential opportunities to company capabilities.
STRATEGIC WINDOW
During one recent year, automakers drove through a strategic window by dramatically increasing their investment in the Indian market and doubling their production of vehicles there. General Motors, Fiat, Honda, Nissan, and Hyundai all announced Indian investments totaling about $1.5 billion, with production to reach nearly 3 million vehicles in one year.
Target Market
Group of people toward whom the firm decides to direct its marketing efforts
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Marketing Strategy
Figure illustrates the focus of the marketing mix variables on the central choice of the target market. In addition, decisions about product, distribution, promotion, and price are affected by the environmental factors in the outer circle of the figure. The environmental variables may play a major role in the success of a marketing program, and marketers must consider their probable effects.
Product strategy
2. Decisions about
What goods or services to offer Customer service Package design Brand names Trademarks Warranties Product Life Cycle Positioning New-product development
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Marketing Environment
Marketers do not make decisions about target markets and marketing mix variables in a vacuum. They must take into account the dynamic nature of the five dimensions of the marketing environment shown back in Figure:
competitive, political-legal, economic, technological, and social-cultural factors.
Marketing Environment
Concerns about the natural environment have led to new regulations concerning air and water pollution. Automobile engineers have turned public concerns and legal issues into opportunities by developing hybrid cars. Note that the marketing environment is fertile ground for innovators and entrepreneurs.
Marketing Environment
Technology has changed the marketing environment as well, partly with the advent of the Internet. Technology now produces a new formulation of diesel fuel that burns cleaner and is more efficient than earlier versions of diesel, as well as petrol.
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Marketing Environment
Rule of ThreeSome experts have coined the phrase rule of three, meaning that in any industry, the three strongest, most efficient companies dominate between 70 and 90 percent of the market. e.g Automobiles FMCG While it may seem like an uphill battle for the remaining companies in any given industry, they can find a strategy for gaining competitive ground.
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Strategic Business Units (SBUs) are key business units within diversified firms
A division, product line, or single product may define an SBU Firms redesign their SBUs as market conditions dictate Each SBU pursues its own distinct mission and often develops its own plans independently of other units in the organization.
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BCG Matrix
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BCG Matrix
This market share/market growth matrix places SBUs in a four quadrant chart that plots market share against market growth potential. Market share is the percentage of a market that a firm currently controls (or company sales divided by total market sales).
BCG Matrix
The position of an SBU along the horizontal axis indicates its market share relative to those of competitors in the industry. Its position along the vertical axis indicates the annual growth rate of the market. After plotting all of a firms business units, planners divide them according to the matrixs four quadrants.
BCG Matrix
Firms in each quadrant require a unique marketing strategy:
Stars represent units with high market shares in high-growth markets: These products or businesses are highgrowth market leaders. They generate considerable income but they need inflows of even more cash to finance further growth. Apples popular iPod is the number one selling portable digital music player in the world, but Apple has already introduced upgrades and new models to remain competitive.
BCG Matrix
Cash cows command high market shares in low-growth markets:
Marketers for such an SBU want to maintain this status for as long as possible. The business produces strong cash flows, but instead of investing heavily in the units own promotions and production capacity, the firm can use this cash to finance the growth of other SBUs with higher growth potentials. For instance, Microsoft uses the profits from sales of its Windows operating system to finance research and development for new Internet-based technologies.
BCG Matrix
Question marks achieve low market shares in high-growth markets.
Marketers must decide whether to continue supporting these products or businesses because question marks typically require considerably more cash than they generate. If a question mark cannot become a star, the firm should pull out of the market and target other markets with greater potential.
BCG Matrix
Dogs manage only low market shares in low-growth markets.
SBUs in this category promise poor future prospects, and marketers should withdraw from these businesses or product lines as quickly as possible. In some cases, these products can be sold to other firms, where they are a better fit. IBM sold its PC business to Chinese firm Lenovo so that it could concentrate on its business services. Eicher Motors sold off their Tractor division (Eicher Tractors) to TAFE, as they were losing market share in low growth tractor market.