Chapter Two
Company and Marketing Strategy
Partnering to Build Customer Relationships
Company and Marketing Strategy
Topic Outline
´ Companywide Strategic Planning: Defining Marketing’s
Role
´ Planning Marketing: Partnering to Build Customer
Relationship Marketing Strategy and the Marketing Mix
´ Managing the Marketing Effort
´ Measuring and Managing Return on Marketing Investment
Companywide Strategic Planning
´ Strategic planning is the process of developing and
maintaining a strategic fit between the organization’s
goals and capabilities and its changing marketing
opportunities.
Companywide Strategic Planning
Defining a Market-Oriented Mission
´ The mission statement is the organization’s purpose,
what it wants to accomplish in the larger environment
´ Market-oriented mission statement defines the
business in terms of satisfying basic customer needs.
A Sound Mission Statement
´ A sound mission begins with the following questions:
´ What is our business?
´ Who is the customer?
´ What do consumers value?
´ What should our business be?
´ These simple-sounding questions are among the most
difficult the company will ever have to answer.
Successful companies continuously raise these questions
and answer them carefully and completely.
Mission Statement
A mission statement should:
´ Not be myopic in product terms
´ Meaningful and specific
´ Motivating
´ Emphasize the company’s
strengths
´ Contain guidelines which are
achievable.
´ Not be stated as making sales
or profits.
Product versus Market Oriented Mission
Product Oriented Market Oriented
´ Facebook ´ Facebook
´ We are an online social network. ´ We connect people around the
world and help them share
important moments in their lives.
´ Revlon ´ Revlon
´ We make cosmetics. ´ We sell lifestyle and self-expression;
Success and status; memories,
hopes and dreams.
Companywide Strategic Planning
Setting Company Objectives and Goals
Mission Statement
Business Objectives
Marketing Objectives
Companywide Strategic Planning
Setting Company Objectives and Goals
Business objectives Marketing objectives
• Build profitable • Increase market
customer share
relationships • Create local
• Invest in research partnerships
• Improve profits • Increase promotion
Companywide Strategic Planning
Designing the Business Portfolio
´ The business portfolio is the collection of businesses and
products that make up the company.(should fit the
company’s strengths and weaknesses to opportunities in
the environment)
´ Portfolio analysis is a major activity in strategic planning
whereby management evaluates the products and
businesses that make up the company.
Companywide Strategic Planning -
Analyzing the Current Business Portfolio
Strategic business units can be:
´ Company division –e.g. cosmetics group
´ Product line within a division –e.g. Makeup product line
´ Single product or brand – e.g. lipstick or Chanel
Companywide Strategic Planning
Analyzing the Current Business Portfolio
Identify key businesses (strategic business
units, or SBUs) that make up the company
Assess the attractiveness of its various
SBUs (attractiveness of SBU’s Market? &
Strength of SBU’s position in that market )
Decide how much support each SBU
deserves
Companywide Strategic Planning
Growth Share Matrix
Market Attractiveness Exercise:
Suggest
examples of
product
categories for
each
quadrant.
Company’s Strength in the market
Companywide Strategic Planning
Developing Strategies for Growth and Downsizing
Product/Market
Expansion Grid:
´ a tool for
identifying
company
growth
opportunities
Companywide Strategic Planning
Developing Strategies for Growth and Downsizing
´ Market penetration growth by increasing sales to current
market segments without changing the product
´ Market development growth by identifying and
developing new market segments for current products
Companywide Strategic Planning
Developing Strategies for Growth and Downsizing
´ Product development is a growth strategy that offers
new or modified products to existing market segments
´ Diversification is a growth strategy through starting up or
acquiring businesses outside the company’s current
products and markets
´ Downsizing prune, harvest or divest businesses that are
unprofitable or that no longer fit the strategy
Planning Marketing - Partnering to Build
Customer Relationships
´ Value chain is a series
of internal departments
that carry out value-
creating activities to
design, produce,
market, deliver, and
support a firm’s
products.
Planning Marketing
Partnering to Build Customer Relationships
´ Value delivery network is made up of the company,
suppliers, distributors, and ultimately customers who
partner with each other to improve performance of the
entire system.
Marketing Strategy and the Marketing Mix
Marketing Strategy and the Marketing Mix
´ Market segmentation is the division of a market into distinct
groups of buyers who have different needs, characteristics, or
behavior and who might require separate products or
marketing mixes.
´ Market segment is a group of consumers who respond in a
similar way to a given set of marketing efforts
Marketing Strategy and the Marketing Mix
Market Targeting
´ Market targeting is the process of evaluating each
market segment’s attractiveness and selecting one or
more segments to enter.
Marketing Strategy and the Marketing Mix
´ Market positioning is the arranging for a product to
occupy a clear, distinctive, and desirable place relative
to competing products in the minds of the target
consumer.
´ Whole marketing plan supports the positioning strategy.
Marketing Strategy and the Marketing Mix
´ Differentiation begins the positioning process
´ Whole marketing plan supports the positioning strategy
Marketing Strategy and the Marketing Mix
Developing an Integrated Marketing Mix
´ Marketing mix is the set of controllable tactical
marketing tools—product, price, place, and promotion
—that the firm blends to produce the response it wants
in the target market
Marketing Strategy and the Marketing Mix
Developing an Integrated Mix
Managing the Marketing Effort
Managing the Marketing Effort
Market Planning—Parts of a Marketing Plan
Executive Marketing Threats and
summary situation opportunities
Objective Marketing Action
and issues strategy programs
Budgets Controls
Managing the Marketing Effort
Marketing Implementation
Implementing:
´Turns marketing plans into marketing actions to
accomplish strategic marketing objectives
´Addresses who, where, when, how
Managing the Marketing Effort
Marketing Department Organization
Functional Organization
Geographic Organization
Product Management
Organization
Market or Customer
Management
Managing the Marketing Effort
Marketing Control
Controlling:
´Evaluating of results
´Taking of corrective action to achieve objectives
´Operating control –against annual plan’s
objectives!
´Strategic control –strategy-opportunity check!
Measuring and Managing Return on Marketing Investment
Marketing ROI
Return on marketing investment
´is net return from a marketing
investment divided by the
costs of the marketing
investment.
´provides a measurement of
the profits generated by
investments in marketing
activities.
