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Transcript of Ch2 Marketing
2. company and marketing strategy partnering to build customer relationships1. Company-wide strategic planning: definingmarketings role Strategic planning is the process of developing andmaintaining a strategic fit between the organisationsgoals and capabilities and its changing marketingopportunities.
First three steps on corporate level Occurs at business-unit, product and market levelEx nestl: quick (chocolate milk), garnier (shampoo), waterDefining a market-oriented mission the mission statement is the organisations purpose,what it wants to accomplish in the larger environment. Market-oriented mission statement defines the businessin terms of satisfying basic customer needs.(not stated in terms of more profit or sales: only a reward) Meaningful and specific yet motivating, emphasizing the companies strengths in the marketplaceA mission statement should: Not be myopic in product termsMotivating not only for costumers but also for employeeswhy are we making the product? ex: mission statement of KUleuven is missingneeds to contain strengths of company Ex: ebay mission statement: environmental friendly, also secondhand Fillips; improving peoples life through innovation Meaningful and specific Motivating Emphasize the companys strengths Contain specific workable guidelines Not be stated as marketing sales or profits
Vision => mission decides business goals/objectives and based on them you create your marketing objectives Designing the business portfolio= the collection of businesses and products that make up the company.(selling if not profitable anymore) Overview on your portfolio you evaluate them to see in which ones youre going to investEx Big : always produce products you through them away, try with different products to growmake overview of whole company on business level : different business units, different small companiesTried panties, underwear, shavings
Portfolio analysis is a major activity in strategic planning whereby management evaluates the products and businesses that make up the company. The best business portfolio has to do with SWOT analysis : strenthes, weaknesses opportunities and treats of environment Analyzing the current business portfoliostrategic business units can be: Company division Product line within a division Single product or brand Ex Nestl: friskies (cats), Nescaf, kitkat (different packaging), nesteabusiness unit can be a product line, company division Ex Philips: SBU: consumer lifestyle, lighting and healthcare they are going to reduce is to two: healthtech (lifestyle and healthcare) and sell lighting (split into two companies) The business portfolio is the collection of businesses and products that make up the company. Portfolio analysis is a major activity in strategic planning whereby management evaluates the products and businesses that make up the company.
The BCG (=Boston consultant group model) growth share matrix
Look at relative market share (compared to biggest competitor)logarithm of your company/ biggest competitor Growthrates: difficult to put different products into the same figure growthrates of apple iphones are totally different from BIG pens Nesquick is cash cow from nestlyou need cashcows (dont need to invest a lot of money in them because not growing anymore) to pay for your stars Problems: Difficulty in defining SBUs and measuring market share and growthdoesnt say anything on the growth Time consuming Expensive Focus on current businesses, not future planning. What about beer market? Only the winterperiod (drink more beer over summer), not in there, no customer information: what about loyal customers? A dog but a good oneDeveloping strategies for growth and downsizingANSOFF : you can grow in different ways Product/market expansion grid= a tool for identifying company growth opportunities through marketpenetration, market development, product development or diversification. Product/market expansion grid strategiesSame new
new same Market penetration =a growth strategy increasing sales to current market segments without changing the product. Ex increased sales because opening of toothpaste was bigger so people used more (so sold more)improve advertising, improve store design, more places to sell Market development =a growth strategy that identifies and develops new market segments for current products.Ex other flavor, new color, change of packaging (fruitella) discussion is this a new product or not?, entering ChinaEx history Nokia: paper, boots and then mobile phones Product development =a growth strategy that offers new or modified products to existing market segments. Diversification = a growth strategy through starting up or acquiring businesses outside the companys current products and markets. Downsizing =the reduction of the business portfolio by eliminating products or business units that are not profitable or that no longer fit the companys overall strategy. Ex new mission Danone : healthy, energy so sold candybars because didnt fit I company strategy SWOT analysis
Managing the marketing function begins with a complete analysis of the companys situation. The marketer should conduct a SWOT analysis Strengths include internal capabilities that may help a company reach its objectives Can work on opportunities and threats in the market Weaknesses include internal limitations that may interfere with a companys ability to achieve its objectives Opportunities External factors that the company may be able to exploit to its advantage Threatscurrent and emerging external factors that may challenge the companys performance External: can try to adapt it, integrate it but cant control itSWOT analysis until p 55-602. Planning marketing: partnering to buildcustomer relationships Value chain= a series of departments that carry out value-creating activities to design, produce, market, deliver and support a firms products. Value delivery network= made up of the company, suppliers, distributors and ultimately customers whopartner with each other to improve performance of the entire system.3. Marketing strategy and the marketing mix
Customer-driven marketing strategy Market segmentation=the division of a market into distinct groups of buyers who have different needs, characteristics or behaviour and who might require separate products or marketing mixes. Market segment =a group of consumers who respond in a similar way to a given set of marketing efforts Customer-centered marketing strategy Market targeting =the process of evaluating each market segments attractiveness and selecting one or more segments to enter. Market positioning =the arranging for a product to occupy a clear, distinctive and desirable place relative to competing products in the minds of the targetconsumer. Developing an integrated marketing mix Marketing mix =the set of controllable tactical marketing toolsproduct, price, place and promotionthat the firm blends to produce the response it wants in the target market.
4. Managing the marketing effort
Parts of marketing planning
Implementing= the process that turns marketing plans into marketing actions to accomplish strategic marketing objectives. Successful implementation depends on how well the company blends its people, organisational structure, decision and reward system and company culture into acohesive action plan that supports its strategies. Marketing department organization
Marketing control Controlling is the measurement and evaluation of results and the taking of corrective action as needed to ensure the objectives are achieved. Operating control Strategic control5. Measuring and managing return on marketingInvestment Return on marketing investment (marketing ROI) =the net return from a marketing investment divided by the costs of the marketing investment. Marketing ROI provides a measurement of the profits generated by investments in marketing activities