2014-03-07

1

International Marketing

1

1.

Corporate strategic planning

Company's growth strategies

2

2014-03-07

2

Agenda

� orientations toward marketplace

� creating the strategy (the procedure, elements and key frameworks)

� intensive growth strategies, integrative growth strategies,diversification strategies

3

THE MARKETING CONCEPT

4

2014-03-07

3

Defining marketing

� Marketing is a societal process bywhich individuals and groups obtainwhat they need and want throughcreating, offering, and freelyexchanging products and services ofvalue with others.

Marketing Management -1

� Marketing management is art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.

2014-03-07

4

Marketing Management -2

The marketing management - is a delicate balance of creativity and structure/formal procedures.

Principles of Marketing

� Customer needs and wants

� Market information as a basis of decisions

� Integrated marketing activities and tools

� Customer satisfaction creation

2014-03-07

5

Marketing Mix 7P’s or 7C’s?

Organizational perspective

� product

� price

� place

� promotion

� physical evidence

� people

� process

Customer perspective

• customer value

• cost

• convenience

• communication

• confirmation

• consideration

• co-ordination and

concern

Marketing Management

The marketing management -consists of:

� analyzing market situation

� designing marketing strategies

� implementing and organizing the marketing effort

� controlling marketing performance

2014-03-07

6

COMPANY’S ORIENTATIONS

TOWARD THE MARKETPLACE

11

Company orientations toward the

marketplace - 1

� Production concept

� Product concept

� Selling concept

� Marketing concept

� Customer concept

� Societal marketing concept

12

Source: P. Kotler (2003). Marketing Management, 11th, Prentice Hall, Upper

Saddle River, p. 17.

2014-03-07

7

Company orientations toward the

marketplace – 2

Concepts Starting point Focus Means Ends

Production Factory Widely available and

inexpensive products

High production efficiency

Low cost

Mass distribution

Profits through

volume and low cost

Product Factory Superior products Making superior products

and improving them over

time

Profits through high

quality product

Selling Factory Products Aggressive selling and

promotions

Profits through sales

volume

Marketing Target market Customer needs Integrated marketing Profits through

customer

satisfaction

Customer Individual customer Customer needs and

value

One-to-one marketing

Integration and value chain

Profits through

capturing customer

share, loyalty, and

lifetime value

Societal marketing Best long-run

interests customer

and society

Customer needs,

customer interests, and

long-run societal welfare

Integrated marketing and

education customer

Profits through

customer

satisfaction and

society’s well-being

13Source: own preparation based on: P. Kotler (2003). Marketing Management,

11th, Prentice Hall, Upper Saddle River, p. 17-27.

Corporate Strategic Planning

� defining the corporate mission (vision)

� establishing SBU

� assigning resources to each SBU

� planning new business, downsizing & terminating older businesses

2014-03-07

8

Mission & Objectives

Mission

� describes the organisation’s basicfunction in society

� explains why the company exists

� provides the commercial logic for thecompany

� needs to be converted into everydayperformance

� is a cultural glue that enables theorganisation to function as a unity

2014-03-07

9

Corporate Mission - Fundamental

Questions

� What is our business?

� Who is the customer?

� What is of value to our customer?

� What will our business be?

� What should our business be?

Infuences on the mission statement

� company’s history

� preferences, values and expectations ofmanagers & owners

� environmental factors

� available resources

� distinctive competences

2014-03-07

10

Workable mission

� brief – easy to understand and remember

� flexible – to accomodate change

� distinctive – to make the firm stand out

Mission or/and vision

� vision gives general sense of direction to the company, is the orientation point thatguides the company

� vision ignores real. practical problems, vision can degenerate to wishful thinking

� mission is about here and now, visionrefers to the future,

� mission is designed to motivate, vision –not!

2014-03-07

11

Objectives

S Specific - descriptive, succinct and provide claritythroughout the organization as to what is to beachieved

M Measurable - clearly state tangible targets that can bemeasured in the future

A Aspirational - challenging but achievable, motivational

R Realistic - based on sound market analysis, financial,human & physical resources should underpin theobjectives

T Timebound - a timescale should be set against theachievment of each objective in order for performancemeasurement to be undertaken

Objectives hierarchy

Corporate objectives – increase profits

Productionobjectives– cut costs

Personnelobjectives– reduce

headcount

Marketing obejctives – increase revenue

Objectives for the mix

Product(10% of

revenue )

Price(skimming)

Promotion(recall)

Place (coverage)

2014-03-07

12

Marketing Objectives e.g.

� rate of return on investment

� net profits

� cash flow

� total sales revenue

� sales volume

� market share

� consumer awareness

� number of distribution outlets

� average realized price

SBU Defining

2014-03-07

13

SBU - Main Characteristics

� SBU is a pasrt of the company that for allintents and purposes has its own distinctproducts, markets and assets

� single business (or collection of relatedbusinesses) that can be planned separatelyfrom the rest of company

� has its own competitors

� has its own manager.......

Analysing the Product Portfolio

2014-03-07

14

Portfolio Evaluation Frameworks

� BCG’s Growth Share Matrix

� GE Multifactor Matrix

� Shell Directional Policy Matrix

-----------------------------------------------------

� Abell & Hammond’s Investment Opportunity Matrix

� Arthur D. Little Strategic Condition Matrix

BCG’s Growth Share Matrix

(traditional approach)

Market

growth

rate

Relative market share

Stars Question marks

Cash cows Dogs

0 xO,5 x1 x

0 %

10 %

100 %

2014-03-07

15

Taking a Portfolio Approach

� analysis based around evaluating SBU activities

� models help you think strategically about the business and its resources and provide analytical frameworks. But:

� they are over-simplified

� cannot incorporate ‘risk’

� often offer misleading representations of strategic options

� use over generous measures

� assume market leadership = benefit

� ignores market ‘inching’

� ignores competitive strategic factors

Determinants of market attractiveness

� Market factors (eg size, growth)

� Competitors

� Investment factors

� Technological change

� Other factors

2014-03-07

16

BCG’s Growth Share Matrix

(practical approach)

Market

attractiveness

Competitive position

Question marks Stars

Dogs Cash cows

100500

0

50

100

References

� Armstrong G., P. Kotler: Marketing.Wprowadzenie, Wolters Kluwer, Warszawa2012

� Gilian C., R. Wilson, Strategic MarketingManagement. Planning, impementatiom andcontrol, Butterworth Heinemann, 1999

� Kotler P. Marketing Management. EleventhEd., Prentice-Hall, Englewood Cliffs, 2003

� Porter M., Competitive Advantage, 1998

� Strategic Marketing Management: Planningand Control, BPP Professional Education, 2003

2014-03-07

17

Gap Analysis

� Diagrammatical approach to viewing the difference between:

� Where we are going? (in the currentway)

� Where we want to be? (targets for achievement)

Gap Analysis

Time

Sales

Desired sales

Current portfolio

Diversification growth

Integrative growth

Intensive growth

The planning

gap

2014-03-07

18

Intensive Growth

Ansoff’s Product - Market Matrix

Product

Current New

Current

New

Market

Market penetration strategy

Market development strategy

Product development strategy

(diversification strategy)

Intensive Growth Strategies

� market penetration strategy

� market development strategy

� product development strategy

2014-03-07

19

Market penetration strategy

� more purchasing and usage form existing customers

� gain customers form competitors

� convert non-users into users

Market development strategy

� new market segments

� new distributiob chanells

� new geographic areas

2014-03-07

20

Product development strategy

� product modifications via newfeatures

� different quality levels

� ‘new’ product

Integrative Growth Strategies

� Vertical integration (VMS)

- backward

- forward

� Horizontal integration (HMS)

2014-03-07

21

Diversification Growth Strategies

� concentric diversification

� horizontal diversification

� conglomerate (lateral) diversification

Consolidation strategies

� Deinwestment

� De(z)integration

� Prunning

� Reduction

� Harvesting

2014-03-07

22

References

� Armstrong G., P. Kotler: Marketing.Wprowadzenie, Wolters Kluwer,Warszawa 2012

� Kotler P. Marketing Management.Eleventh Ed., Prentice-Hall, EnglewoodCliffs, 2003

� Strategic Marketing Management:Planning and Control, BPP ProfessionalEducation, 2003

Case study