Chapter Two

Strategic Marketing Planning

2.1. Nature and Scope of SMP
 SMM is all about helping the organization to develop a
unique identity in the market, grow its businesses
geographically, and serve the customers better than the
competitors.
Marketing Plan: one year
 A written document that specifies the details of the marketing
activities to be performed and the programs to be undertaken
to achieve the marketing goals.
 The application of your strategy a roadmap that will guide
you from one point to another.

7/25/2024 1
Strategic plan: 3-5 years
 The comprehensive plan formulated particularly for achieving
marketing objectives of the organization.
 A plan of action for identifying and analyzing a target market
and developing a marketing mix to meet the needs of that
market.
 It Involves setting goals and objectives analyzing internal and
external business factors, product planning, implementation,
and tracking your progress.
 It puts all the pieces together so that everything you do
contributes to the success of your business.

7/25/2024 2
2.2. Strategic Market Planning Process

7/25/2024 3
2.3. Approaches to Planning
1. Top-down Planning
2. Down-up Planning
3. Goals-down-plans-up Planning
1. Top-down Planning
 Senior management set the goals and most of the plans for
middle managers.
 The top management has complete knowledge of what is
happening both within and outside the firm, an assumption
which is difficult to justify.
 It suffers from the drawback that implementation will take
longer as junior managers and employees try to understand
the various aspects of the plan.
 Developing ownership of the plan is difficult: people usually
prefer to join in with the planning process if they can
7/25/2024 4
2. Bottom-up Planning
 The various departments of the company produce their own
plans, based on their understanding of the needs of the
market and of their own departmental capabilities.
 The plans are then submitted to senior management for
approval and coordination.
 In these circumstances, a marketing-oriented company will
find the process easier because customer needs will act as the
coordinating force.

7/25/2024 5
2. Goals-down-plans-up Planning
 The most common.
 Senior management set the overall goals, leaving the detail of
the planning to the various departments.
 Enables departments to plan around their own resources,
while maintaining an overall direction for the firm.
 In the case of top-down planning, marketers may be involved
at high level but are more likely to be operating in a
marketing department which will have to show how they will
bring in the business which the senior managers are planning
around.
 Marketers will have responsibility for developing a marketing
plan based on the overall corporate objectives

7/25/2024 6
2.3. Elements of Strategic Plan
1. Strategic Direction or Mission Statement
2. Objectives and Goals
3. Growth Strategy
4. Business Portfolio Plans

7/25/2024 7
1. Strategic Direction: Mission statement
 The mission or vision statement of the company, business unit,
product line, or individual product.
 The long range philosophy of a business unit.
 It reflects a strategic vision of what your product or business can
become within three to five years.
 A well-devised mission statement for any organization, unit
within an organization, or single-owner business should answer
the same five basic questions:
a) Who are we?
b) Who are our customers?
c) What is our operating philosophy: beliefs, values, ethics, etc.)?
d) What are our core competencies or competitive advantages?
e) What are our responsibilities with respect to being a good
steward of our human, financial, and environmental resources?

7/25/2024 8
Characteristics of Successful Mission Statements
A. Credibility: realistic ambitions for the organization; believable
in stakeholders and employees.
B. Uniqueness: not be generically applied to a range of other
organizations; it has to relate to the company and its
stakeholders in a unique fashion.
C. Specific Capabilities: embrace the core capabilities and roles
in the future organization.
D. Aspirational
 It needs to motivate individuals by giving them a statement
that has significance to the work they undertake: meaningful
in terms of more than just making profits.
 It should engender a vision to which individuals feel they
wish to contribute.
7/25/2024 9
Components of Good Mission Statement
 Products or services
 Target market
 Technology
 Philosophy
 Policy for employees
 Self-concept
 Concern for survival, growth, and profitability
 Public images
Example:
1. To be the number one aerospace company in the world and among
the premier industrial concerns in terms of quality, profitability,
and growth. (Boeing)
2. Delight our customers, employees, and shareholders by relentlessly
delivering the platform and technology advancements that become
essential to the way we work and live.
3. To be recognized as a highly rated utility based company trading in
electricity, other utility and related markets providing excellent
quality and service to customers and above average total returns to
investors.

7/25/2024 10
Mission statement or strategic direction consider the following:
 What are the distinctive areas of expertise of the company?
 What business should the company be in over the next three
to five years?
 What types or categories of customers will the company
serve?
 What customer functions is the company likely to satisfy as
the market evolves?
 What technologies will the company use to satisfy
customer/market needs?
 What changes are taking place in markets, consumer behavior,
competition, environment, culture and the economy?

7/25/2024 11
2. Objectives and Goals
 A strategic focus.
 Designed in keeping the scope of strategic direction and
within the time frame of three to five years.
 It should be short enough to be realistic and achievable.
3. Growth Strategies
a. Internal strategies: relate to marketing, manufacturing, R &
D, distribution and pricing, as well as to existing and new
products and services, market research, packaging, customer
services, information technology, finance, sales activities, and
organizational changes.
b. External strategies: joint ventures, licensing agreements, new
supply chain networks, emerging market segments and any
opportunities for diversification, providing diversification fits
the company‘s strategic direction.

7/25/2024 12
4. Business Portfolio
 A strategic direction has meaning only if it translates into a
realistic business portfolio of markets and products.
 It contains a listing of all existing markets and all potential
new markets that are feasible within the next three to five
years and which match your company‘s strategic direction.
 It related To Portfolio Analysis, BCG Matrix, GE Model, or
Ansoff Product/Market expansion grids can be used.

7/25/2024 13
2.4. Developing the Marketing Plan
1. Situational analysis
2. Market opportunities
3. Marketing objectives
4. Strategies and action plans
5. Financial controls and budgets

7/25/2024 Kindye T, MA in MMgt 14

1. Situational Analysis
i. Marketing Mix Analysis
ii. Market Analysis
iii. Competitor Analysis
i. Marketing Mix Analysis
 It describes factual and objective terms where the marketing
operation stands in relation to the total marketing mix:
a. Product
b. Price
c. Distribution and
d. Promotion

7/25/2024 15
A. Product
 Objectively describe the product by:
 Sales history.
 Position in the industry: life cycle (introduction, growth,
maturity, decline and phase out).
 Future trends in the industry: government regulation,
technology, financial, buyer behavior, that may affect product
position.
 Purposes of the product: market use, uniqueness, or
positioning.
 Features and benefits of the product: cost, safety, or
convenience,
 Other pertinent product information: expected product
improvements and additional product characteristics (quality,
size, model, price).

7/25/2024 16
B. Pricing Planning Guidelines
 Evaluate the company‘s and competitors‘ pricing policies for
each market segment and/or distribution channel and their
impact on market position.
 Evaluate what the pricing trends will be on the basis of raw
material sourcing, product specification changes, financial
factors, customers‘ attitudes and possible competitive
response.
c. Distribution Channels and Methods Planning Guidelines:
 Conduct a value chain analysis: quantities sold directly and
through dealers; and prepare an analysis of physical
distribution.
 Identify effectiveness of coverage through the current supply
chain with the functions each of the links performs.
 List functions or unique sales activities performed to segments.
 Identify future trends in distribution methods and channels.
7/25/2024 17
d. Promotion Planning Guidelines
 Analyze the advertising and sales promotion directed at each
segment of the market by copy theme, expenditure and
media.
 Indicate past and current advertising and sales promotion
strategies by product and market segment.
 Describe publicity, educational and other non-advertising
influences that have been used and with what effect.

7/25/2024 18
ii. Market Analysis
 Providing information about industries, customers,
competitors, and other market variables.
 Addresses customer behaviors which serves as a foundation
for developing objectives and strategies.
 Focuses on the behavioral aspects of customers and prospects
in a changing and competitive environment.
 It requires to compiling the following information:
 Customer profile
 Frequency and magnitude of product usage
 Geographic aspects of product usage
 Customer characteristics
 Buying decision making
 Customer motivations, customers‘ awareness the company‘s
product
 Segment trends: size and character various submarkets
7/25/2024 19
iii. Competitor Analysis
 It covers market share, competitive strengths and weaknesses,
and product comparison against the major competitors.
 List all major & additional competitors Strengths and
Weaknesses: financial resources, management leadership,
human resources and others and descending-size order,
showing relative position to show a total minimum list of
five.
2. Market Opportunity
 It is a newly identified need that not being addressed by
competitors:
 Consider all possibilities that can expand your coverage of
existing markets.
 Opportunities are abound in the present market, new market,
product development and innovations, etc.

7/25/2024 20
Market Opportunity Analysis Template

7/25/2024 21
3. Marketing Objectives
 Setting goals to achieve during the current planning period.
 Primary or quantitative objectives are related to sales, market
share, profits and return on investment.
 A statement of your functional objectives, which concern
both product and non-product-related goals.
 Major assumptions for the current planning:
 Economic assumptions: GNP, industrial production, plant and
equipment expenditures, activities of competitors, costs and
prices, local economics, consumer expenditures, tendencies
and changes in customer needs.
 Technological assumptions: intensity of R and D effort,
likelihood of technical breakthroughs, availability of raw
materials and plant capacity.
 Socio-political assumptions: legislation, political tensions, tax
picture, population patterns, education, consumer habits, and
changes in customer needs

7/25/2024 22
4. Marketing Strategies and Tactics
i. Marketing Strategies
 It is the process that can allow an organization to concentrate
its limited resources on the greatest opportunities to increase
sales and achieve SCA.
a. Segmentation, Targeting and Positioning Strategy
 Which segment should be targeted and how consumers
should perceive the company and its products.
b. Branding Strategy
 Should the company use corporate branding, private
branding, licensed branding or co-branding?
c. Competitive Strategy
 Should the company use cost minimization, differentiation, or
concentration strategy?

7/25/2024 23
ii. Marketing Tactics
 They the strategic actions that direct the promotion of a
product or service to influence specific marketing goals.
a. Product Strategy: what changes are needed in product and
packaging?
b. Pricing Strategy: what changes are needed in pricing,
discounts and long-term contracts?
c. Advertising Strategy: what are the most effective benefits to
feature and how should basic copy ideas and copy themes
be presented to special groups?
d. Media Strategy: what suggestions should be made to the
advertising agency?
e. Promotion Strategies: what suggestions should be made for
private labeling; that programs should be introduced to
dealers and other levels of distribution and the sales force?

7/25/2024 24
5. Financial Controls and Budgets
 Decide & implementing how to monitor its execution.
 Develop procedures for both control (comparing actual and
planned figures) and review (indicating corrective measures
taken).

7/25/2024 25
2.5. Schedule for Marketing Planning
 It used to demonstrate that effective planning is a participative process
requiring input from all levels of management.

7/25/2024 26
7/25/2024 27
2.6. Structure of a Marketing Plan
 Marketing plan is the tangible outcome of the planning
process.
 The major sections of a marketing plan:
1) Overview of current position and organizational context
2) Organization mission and objectives
3) Environmental analysis: external & internal (market and
industry analysis)
4) Gap analysis and identification of marketing opportunities
5) Setting of marketing objectives
6) Strategy formulation: segmentation, targeting and
positioning
7) Marketing programs: detailed specification of the marketing
mix.
8) Implementation, monitoring and control
7/25/2024 28
.

7/25/2024 29
Typical Structure for a Marketing Plan
1. Executive Summary
 Background and context of current position of organization
 Identification of key strategic planning issues
2. Organizational Strategy
 Organizational mission and objectives
 Summary of overall position and organizational strategy
3. External and Internal Marketing Audit
 Customer analysis: identification of environmental drivers
 Industry competitor and intermediary analysis
 Market trends and projections
 Internal analysis of resources and capabilities
 SWOT analysis.

7/25/2024 30
4. Marketing Objectives
 Specification of marketing objectives
 Financial and non-financial objective
5. Marketing Strategy
 Market mix strategy
 Market segmentation analysis
 Competitive advantage
 Alternative strategy specification and selection of target
markets.
6. Implementation
 Timing of activities
 Responsibilities and structures
 Marketing resourcing budgets

7/25/2024 31
7. Monitoring, Evaluation and Control
 Monitoring processes
 Control mechanism
8. Appendix
 Main planning assumptions
 Projected financial and non-financial outcome forecasts

7/25/2024 32
 THANK YOU!!!

7/25/2024 33