Chapter 2: Developing Marketing Plans and Market Opportunities
Introduction to Marketing Planning
Marketing planning is the systematic process of analyzing market
opportunities, setting objectives, developing marketing strategies, and
implementing activities to achieve organizational goals.
A marketing plan acts as:
A roadmap for the company
A communication tool
A control mechanism
A strategic decision-making guide
According to Marketing Management, successful companies align
marketing plans with overall corporate strategy and environmental
opportunities.
1. Strategic Planning: Three Key Areas and Four Organizational
Levels
Meaning of Strategic Planning
Strategic planning refers to the managerial process of developing and
maintaining a strategic fit between:
Organizational objectives
Resources
Changing market opportunities
It ensures long-term survival and competitiveness.
Three Key Areas of Strategic Planning
A. Managing a Company’s Business Portfolio
Business portfolio refers to:
The collection of businesses and products that make up the company.
Management must:
Decide which businesses to grow
Maintain profitable businesses
Eliminate weak businesses
Tools Used
BCG Matrix
GE Matrix
SWOT Analysis
Example
Nestlé manages:
Coffee products
Dairy products
Health nutrition
Bottled water
They continuously evaluate which product categories generate the
highest returns.
B. Assessing Market Opportunities
Organizations identify:
Current opportunities
Future opportunities
Threats from competitors
This involves:
Market research
Consumer analysis
Trend forecasting
Example
Grab expanded from ride-hailing into:
Food delivery
Digital payment
Insurance
because of market opportunities.
C. Matching Resources with Opportunities
The company must ensure:
Financial resources
Human resources
Technology
Production capacity
are sufficient to exploit opportunities.
Strategic Fit
The goal is:
Matching internal strengths with external opportunities.
Four Organizational Levels in Strategic Planning
Strategic planning occurs at four levels:
Level Focus
1. Corporate Level Overall company direction
2. Division Level Strategy for divisions
3. Business Unit Competing in specific
Level markets
Product-specific marketing
4. Product Level
plans
1. Corporate Level
Top management:
Defines mission
Sets company objectives
Allocates resources
Example
AirAsia decides:
Expansion into ASEAN markets
Digital transformation strategy
2. Division Level
Large companies have divisions:
Consumer products
Industrial products
International operations
Each division develops its own strategies.
3. Business Unit Level
Strategic Business Unit (SBU):
A single business or collection of related businesses that can be planned
independently.
Each SBU has:
Separate competitors
Separate managers
Distinct objectives
Example
Procter & Gamble has SBUs for:
Beauty products
Healthcare
Baby care
4. Product Level
Focuses on:
Product marketing plan
Branding
Promotion
Pricing
Distribution
2. Corporate and Division Strategic Planning
Definition
Corporate strategic planning involves:
Planning activities conducted at the highest organizational level to guide
the entire company.
Steps in Corporate Strategic Planning
A. Defining Corporate Mission
Mission statement explains:
Purpose of organization
Customers served
Value provided
Characteristics of Good Mission Statement
Clear
Realistic
Motivating
Market-oriented
Example
Tesla mission:
“To accelerate the world’s transition to sustainable energy.”
B. Establishing Strategic Business Units (SBUs)
Companies divide operations into SBUs for easier planning.
Characteristics of SBU
Separate mission
Own competitors
Independent planning
C. Assigning Resources to SBUs
Management decides:
Which SBU receives more investment
Which should be maintained
Which should be divested
Business Portfolio Analysis
BCG Matrix
Developed by:
Boston Consulting Group
Four Categories
Category Characteristics
High growth, high market
Stars
share
Low growth, high market
Cash Cows
share
Question High growth, low market
Marks share
Low growth, low market
Dogs
share
D. Growth Strategies
Intensive Growth
1. Market penetration
2. Market development
3. Product development
Integrative Growth
1. Backward integration
2. Forward integration
3. Horizontal integration
Diversification Growth
Entering new industries or markets.
Division Strategic Planning
Each division:
Develops objectives
Coordinates activities
Supports corporate goals
Division managers:
Analyze markets
Manage resources
Monitor performance
3. Business Unit Strategic Planning
Meaning
Business unit strategic planning focuses on:
Achieving competitive advantage within a specific market.
Steps in Business Unit Strategic Planning
A. Mission Statement
Each business unit develops a mission aligned with corporate mission.
B. SWOT Analysis
SWOT stands for:
Internal External
Factors Factors
Strengths Opportunities
Weaknesses Threats
Internal Environment Analysis
Strengths
Strong brand
Skilled employees
Technology
Weaknesses
High costs
Poor distribution
Weak branding
External Environment Analysis
Opportunities
New markets
Digital trends
Population growth
Threats
Competition
Economic downturn
Government regulations
Marketing Opportunity Analysis (MOA)
A marketing opportunity exists when:
A company can profitably satisfy unmet consumer needs.
Questions in MOA
What benefits do consumers seek?
Who are target customers?
How strong is competition?
Can company deliver superior value?
Goal Formulation
Objectives should follow SMART criteria:
SMAR
Meaning
T
S Specific
Measurabl
M
e
A Achievabl
SMAR
Meaning
T
e
R Relevant
Time-
T
bound
Strategy Formulation
Strategies determine:
Target market
Positioning
Competitive advantage
Porter’s Generic Strategies
Developed by Michael Porter
Strategy Description
Cost Lowest cost
Leadership producer
Differentiation Unique offerings
Serve niche
Focus
market
Program Formulation
Converting strategy into:
Action plans
Budgets
Activities
Implementation
Executing marketing plans effectively.
Success depends on:
Leadership
Communication
Coordination
Feedback and Control
Monitoring performance using:
Sales analysis
Profit analysis
Customer satisfaction
Market share
Corrective actions are taken when performance deviates from objectives.
4. The Marketing Process
Definition
The marketing process involves:
Creating value for customers and building strong customer relationships.
Five-Step Marketing Process
Step 1: Understanding Marketplace and Customer Needs
Companies study:
Customer wants
Buying behavior
Market trends
Core Concepts
Needs
Wants
Demands
Step 2: Designing Customer-Driven Marketing Strategy
Market Segmentation
Dividing market into groups with similar characteristics.
Targeting
Selecting attractive segments.
Positioning
Creating distinct image in customer minds.
STP Model
Segmentation Variables
Consumer
Variables
Market
Region,
Geographic
climate
Demographic Age, gender
Psychographic Lifestyle
Behavioral Usage rate
Step 3: Constructing Integrated Marketing Program
Uses marketing mix:
Product
Price
Place
Promotion
For services:
People
Process
Physical evidence
Marketing Mix (4Ps)
P Description
Goods/services
Product
offered
Price Amount charged
Place Distribution activities
Promotio Communication
n activities
Extended Marketing Mix (7Ps)
Additional Ps Description
Employees and
People
customers
Service delivery
Process
procedures
Physical
Tangible cues
Evidence
Step 4: Building Customer Relationships
Focus on:
Customer satisfaction
Customer loyalty
Customer lifetime value
Customer Relationship Management (CRM)
CRM involves:
Managing detailed information about customers to maximize loyalty.
Step 5: Capturing Value from Customers
Companies gain:
Sales revenue
Market share
Customer equity
Long-term profitability
5. Product Planning: Nature and Contents of Marketing Plan
Nature of Marketing Plan
A marketing plan is:
A written document detailing marketing objectives, strategies, and
actions.
It explains:
Where the company is now
Where it wants to go
How to get there
Importance of Marketing Plan
Benefits
Provides direction
Reduces uncertainty
Coordinates activities
Improves control
Assists budgeting
Types of Marketing Plans
Type Focus
Annual Marketing One-year
Plan activities
Type Focus
Product Marketing
Specific product
Plan
New Product Plan Product launch
Digital Marketing Online
Plan marketing
Contents of Marketing Plan
1. Executive Summary
Brief overview of:
Objectives
Strategies
Expected outcomes
2. Situation Analysis
Includes:
Market analysis
Competitor analysis
SWOT analysis
Tools Used
PESTEL
Porter’s Five Forces
PESTEL Analysis
Factor Description
Government
Political
policies
Economic Inflation, income
Social Lifestyle trends
Technologic
Innovation
al
Environment
Sustainability
al
Laws and
Legal
regulations
Porter’s Five Forces
Developed by Michael Porter
Force Description
Rivalry among Industry
competitors competition
Threat of new entrants Ease of entry
Bargaining power of Customer
buyers influence
Bargaining power of
Supplier influence
suppliers
Alternative
Threat of substitutes
products
3. Marketing Objectives
Examples:
Increase sales by 15%
Increase market share
Improve brand awareness
4. Marketing Strategy
Includes:
Target market
Positioning
Marketing mix
5. Action Programs
Detailed activities:
Advertising campaigns
Promotions
Social media plans
6. Budgets
Estimated costs:
Advertising
Distribution
Staffing
7. Controls
Methods to evaluate performance:
KPIs
Sales targets
ROI analysis
Characteristics of Effective Marketing Plans
Effective marketing plans are:
Specific
Flexible
Realistic
Data-driven
Customer-oriented
Summary of Chapter
This chapter explains:
1. Strategic planning and organizational levels
2. Corporate and division planning
3. Business unit planning
4. The marketing process
5. Structure and importance of marketing plans
The key idea:
Successful marketing requires strategic alignment between customer
needs, company capabilities, and market opportunities.