Chapter 2
Developing Marketing Strategies and Plans
Chapter Questions
1. How does marketing affect customer value?
2. How is strategic planning carried out at different levels of the organization?
3. What does a marketing plan include?
Improving Value Delivery the Japanese Way
1. Zero customer feedback time
2. Zero product improvement time
3. Zero purchasing time
4. Zero setup time
5. Zero defects
3 V’s Approach to Marketing
1. Define the value segment
2. Define the value proposition
3. Define the value network
Benchmarks
• Organizational, costs, and performance measures
• Competitor, costs, and performance measures
Core Business Processes
• Market sensing
• New offering realization
• Customer acquisition
• Customer relationship management
• Fulfillment management
Characteristics of Core Competencies
• A source of competitive advantage
• Applications in a wide variety of markets
• Difficult to imitate
Challenges Facing CMO’s
• Doing more with less
• Driving new business development
• Becoming a full business partner
Levels of a Marketing Plan
Strategic
• Target marketing decisions
• Value proposition
• Analysis of marketing opportunities
Tactical
• Product features
• Promotion
• Merchandising
• Pricing
• Sales channels
• Service
Corporate Headquarters’ Planning Activities
• Define the corporate mission
• Establish SBUs
• Assign resources to each SBU
• Assess growth opportunities
Good Mission Statements
• Focus on limited number of goals
• Stress major policies and values
• Define major competitive spheres
Major Competitive Spheres
• Industry
• Products
• Competence
• Market segment
• Vertical channels
• Geographical
Rubbermaid Commercial Products, Inc.
“Our vision is to be the Global Market Share Leader in each of the markets we serve. We will earn this
leadership position by providing to our distributor and end-user customers innovative, high-quality, cost-
effective and environmentally responsible products. We will add value to these products by providing
legendary customer service through our uncompromising Commitment to Customer Satisfaction.”
Motorola
“The purpose of Motorola is to honorably serve the needs of the community by providing products and
services of superior quality at a fair price to our customers; to do this so as to earn an adequate profit
which is required for the total enterprise to grow; and by doing so, provide the opportunity for our
employees and shareholders to achieve their personal objectives.”
Infosys Technologies Ltd.
“To achieve our objectives in an environment of fairness, honesty, and courtesy towards our clients,
employees, vendors and society at large.”
eBay
“We help people trade anything on earth. We will continue to enhance the online trading experiences of
all – collectors, dealers, small businesses, unique item seekers, bargain hunters, opportunity sellers, and
browsers.”
Characteristics of SBUs
• It is a single business or collection of related businesses
• It has its own set of competitors
• It has a leader responsible for:
Strategic planning
Profitability
Efficiency
Organizations
• Culture
• Policies
• Structure
Market Opportunity Analysis (MOA)
• Can the benefits involved in the opportunity be articulated convincingly to a defined target market?
• Can the target market be located and reached with cost-effective media and trade channels?
• Does the company possess or have access to the critical capabilities and resources needed to deliver
the customer benefits?
Market Opportunity Analysis (MOA)_2
• Can the company deliver the benefits better than any actual or potential competitors?
• Will the financial rate of return meet or exceed the company’s required threshold for investment?
Goal Formulation and MBO
Requirements for using MBO
• Unit’s objectives must be hierarchical
• Objectives should be quantitative
• Goals should be realistic
• Objectives must be consistent
Porter’s Generic Strategies
• Overall cost leadership
• Differentiation
• Focus
Categories of Marketing Alliances
• Product or Service Alliances
• Promotional Alliances
• Logistics Alliances
• Pricing collaborations
Marketing Plan Contents
Executive summary
Table of contents
Situation analysis
Marketing strategy
Financial projections
Implementation controls
Evaluating a Marketing Plan
Is the plan simple?
Is the plan specific?
Is the plan realistic?
Is the plan complete?