Chapter 1: Introduction to Marketing Planning Presentation © 2005 Marian Burk Wood - all rights reserved 1-1.

Chapter 1: Introduction to Marketing Planning

Presentation © 2005 Marian Burk Wood - all rights reserved

1-1

What is a marketing plan for?What is a marketing plan for?

To summarize marketplace knowledge To show what marketing will accomplish To detail marketing strategies, activities To show how progress will be measured To explain implementation control


1-2

Marketing plan contentsMarketing plan contents

1. Executive summary, table of contents 2. Current situation (with SWOT)3. Objectives and issues analysis4. Target market5. Marketing strategy and programs6. Financial plans7. Implementation controls


1-3

Researching the current situationResearching the current situation

Examine external environment Assess internal capabilities Understand competitors’ strategies Analyze stakeholders’ influence


1-4

Understanding markets/customersUnderstanding markets/customers

Learn about markets and customers Examine needs, wants, attitudes Research buying behaviors


1-5

Planning segmentation, targeting, Planning segmentation, targeting, and positioningand positioning

Identify segments, decide which to target

Create competitively distinctive position in the minds of targeted customers


1-6

Planning direction, objectives, Planning direction, objectives, and marketing supportand marketing support

Determine strategic direction Set objectives Plan customer service support Plan internal marketing support


1-7

Approaches to growthApproaches to growth

Exhibit source: Adapted from Alan R. Andreasen and Philip Kotler, Strategic Marketing for Non-Profit Organizations, 6e (Upper Saddle River, NJ: Prentice Hall, 2003), 81.


1-8

Promotionadvertising, selling, sales

promotion

Channellocations,inventory, coverage

Pricingvalue, discount,

rebate, terms

Offeringproduct, service,

brand, benefit

PRIMARYMARKETING

TOOLS


1-9

Preparing to track progress and Preparing to track progress and control implementationcontrol implementation

Develop sales forecasts Create budgets and schedules Plan to measure performance Diagnose results Adjust activities as needed


1-10

Guiding principles for marketingGuiding principles for marketing

Expect change Emphasize relationships Involve everyone Seek alliances Be innovative


1-11

Chapter 2: Analyzing the Current Situation


2-1

Inside the marketing environmentInside the marketing environment

1. Macroenvironment Broad forces that can affect performance

2. Microenvironment Groups that more directly influence

performance


2-2

Using environmental scanningUsing environmental scanning

Exhibit source: Marian Burk Wood, Marketing Planning: Principles into Practice (Harlow, Essex, England: Pearson Education, 2004), 40.


2-3

SWOT analysisSWOT analysis

Strengths

Internal capabilities that can help the organization achieve its objectives

Weaknesses

Internal factors that can prevent the organization from achieving its objectives

Opportunities

External circumstances that may be exploited for higher performance

Threats

External circumstances that might hinder performance


2-4

Analyzing the internal environmentAnalyzing the internal environment

Mission Resources Offerings Previous results Keys to success, warning signs Business relationships


2-5

Analyzing the external environmentAnalyzing the external environment

Demographic trends Economic trends Ecological trends Technological trends Political-legal trends Social-cultural trends Competitors


2-6

Judging strengths & weaknessesJudging strengths & weaknesses

Exhibit source: Mary K. Coulter, Strategic Management in Action (Upper Saddle River, NJ: Prentice Hall, 1998), 141.


2-7

Sample SWOT: FedExSample SWOT: FedEx


Strengths

FedEx, Kinko’s brands Air, ground strength Stable workforce

Weaknesses Possible labor actions Slower growth in package

volume

Opportunities

New markets (China) Custom/special services More channels (Kinko’s)

Threats

Intense competition Technology Fuel costs

2-8

Chapter 3: Understanding Markets and

Customers


3-1

Types of marketsTypes of markets

Consumer market • People buying for themselves or their families

Business market• Companies, nonprofits, government agencies,

or institutions buying for organizations


3-2

Defining the marketDefining the market


Penetrated market(customers already buying

such an offering)

Target market(customers being targeted)

Qualified available market(customers qualified to buybased on certain criteria)

Available market(customers interested in, with enough income for, and with

access to offering)

Potential market(all customers who may be

interested in an offering)

3-3

Calculating market shareCalculating market share

Units: If all companies sell 10 million units of a type of product and Company A sells 2 million units, its market share is 20%

Dollars: If all sales of a type of product total $100 million and Company A’s sales are $15 million, its market share is 15%


3-4

Influences on consumer marketsInfluences on consumer markets

1. Cultural considerations Nation or region, subculture, class

2. Social connections Family, friends, colleagues, aspirations

3. Personal factors Lifestyle, motivation, perceptions/attitudes


3-5

Influences on business marketsInfluences on business markets

1. Organizational connections Role in and influence on buying process,

relations with competing suppliers

2. Organizational considerations Company’s size, industry, share, growth,

competition, buying policies, finances, buying cycle, derived demand


3-6

Using marketing researchUsing marketing research

Secondary research • Data collected for another purpose• Sources: government, industry groups,

other

Primary research • Data collected for a specific situation• Sources: surveys, ethnography, other


3-7

Analyzing markets and customersAnalyzing markets and customers


Understand behavior, needs Check demographics Watch for changes Take customers’ view Look below the surface Plan for research

3-8

Chapter 4: Planning Segmentation, Targeting,

and Positioning


4-1

Applying market segmentationApplying market segmentation

Group customers according to similar needs, habits, or attitudes that can be addressed through marketing.

Useful if customers in a segment react differently to marketing, vs. customers in other segments.


4-2

Using segmentation, targeting, and Using segmentation, targeting, and positioningpositioning

Presentation © 2005 Marian Burk Wood – all rights reserved

Segmentation• Select the market• Apply segmentation variables • Assess, select segments for targeting

Targeting• Select number, rank segments for entry• Select segment coverage strategy

Positioning• Select attributes for differentiation• Apply positioning through marketing

4-3

Selecting the market to segmentSelecting the market to segment

Define the general market

Eliminate inappropriate markets/segments• Geographically difficult to reach• Insufficient purchasing power• Ethical issues• Environmental problems


4-4

Variables for consumer market Variables for consumer market segmentationsegmentation


Demographic

Age, gender, household size, family status, income, race, occupation, religion, class, nationality

Geographic

Location (country, region, state, city, neighborhood, postal code), distance, climate

Psychographic

Lifestyle, activities, interests

Behavioral/Attitudinal

Benefits perceived/expected, loyalty, usage occasion/rate, user status, price sensitivity, product or brand attitude

4-5

Variables for business market Variables for business market segmentationsegmentation

DemographicIndustry; business size/age; ownership

GeographicLocation; distance; climate

Behavioral/attitudinalPurchasing patterns/process; user status; benefits expected; supplier requirements…


4-6

Assessing segment attractivenessAssessing segment attractiveness


Fit with • Company resources • Core competencies

Fit with• Market factors• Competitive factors• Economic and technological factors• Business environment factors

Identify• Most promising segments • Order of segment entry

4-7

Coverage strategiesCoverage strategies

Concentrated marketing• Target only one segment

Undifferentiated marketing• Target all segments with same strategy

Differentiated marketing• Use a separate strategy to target each

segment


4-8

Positioning for competitive Positioning for competitive advantageadvantage

Use meaningful differentiation• Based on what customers value• Conveys the brand’s value

Apply marketing leverage• Positioning drives marketing• Positioning reinforces differentiation


4-9

Chapter 5: Planning Direction, Objectives, and

Marketing Support


5-1

Options for marketing plan directionOptions for marketing plan direction

1. Growth

2. Maintenance

3. Retrenchment


5-2

Growth strategiesGrowth strategies


Market penetration

Sell more of existing products in

existing markets/segments

Market development

Sell existing products in new

segments/markets

Product development

Sell new products in existing markets/segments

Diversification

Sell new products in new markets

5-3

Maintenance strategiesMaintenance strategies

Sustain current revenues/share

Wring short-term profits

Prepare for future growth


5-4

Retrenchment strategiesRetrenchment strategies

Exit markets, drop products

Downsize marketing, limit distribution

Close down in orderly fashion


5-5

Effective marketing plan objectivesEffective marketing plan objectives

Specific, time-defined, measurable Realistic yet challenging Consistent with mission and goals Appropriate for environment,

opportunities, and threats


5-6

Types of marketing plan objectivesTypes of marketing plan objectives

Marketing objectives • To manage key relationships/activities

Financial objectives • To attain certain financial results

Societal objectives • To achieve social responsibility results


5-7

Sample objectivesSample objectives

Marketing• Customer/channel relationships; market

share; brand awareness

Financial• ROI; revenue/profit by product, channel;

break-even by product

Societal • Greener/cleaner operations; charitable

activities; energy conservation


5-8

Planning marketing supportPlanning marketing support

Customer service • Satisfy customer needs • Reinforce positioning, allocate resources

Internal marketing • Focus employees on customers• Inform and involve employees• Improve employee performance,

satisfaction


5-9

Shaping the marketing mixShaping the marketing mix

Exhibit source: Adapted from Tim Berry and Doug Wilson, On Target: The Book on Marketing Plans (Eugene, OR: Palo Alto Software, 2001), 107.


5-10

Chapter 6: Developing Product and

Brand Strategy


6-1

What can be marketed as a What can be marketed as a product?product?

Tangible goods Services Places Ideas Organizations People


6-2

Product and brand strategyProduct and brand strategy


6-3

Features, benefits, and servicesFeatures, benefits, and services

Features• Enable product to perform its function

Benefits• Need satisfaction that customers want

Related services• Deliver benefits valued by customers


6-4

Quality and designQuality and design

Quality• How well a product satisfies customers

• Basic functionality is a given

Design• Perform properly, repair easily

• Be aesthetically pleasing


6-5

Packaging and labelingPackaging and labeling

Packaging• For convenience and product safety

Labeling• To communicate contents, uses, warnings


6-6

Product life cycleProduct life cycle


Introduction Growth

MaturityDecline

6-7

New product development processNew product development process

1. Idea generation 2. Screening of ideas3. Initial concept testing 4. Business analysis5. Prototype design6. Market testing7. Commercialization8. Monitoring reaction


6-8

Managing productsManaging products

Product line• Products in a line are related • Line extension adds a product

Product mix• Assortment of all lines offered• Brand extension widens mix


6-9

Branding a productBranding a product

Conveys an identity Differentiates an offer Uses words, designs, or symbols May be legally protected


6-10

Pyramid of brand equityPyramid of brand equity

Exhibit source: Adapted from Kevin L. Keller, Strategic Brand Management 2e (Upper Saddle River, NJ: Prentice Hall), 76.


6-11

Chapter 7: Developing Channel and

Logistics Strategy


7-1

What is the value chain?What is the value chain?

Series of interrelated, value-added functions

Structure of organizations performing these functions

Gets the right product to the right markets at the right time, place, price


7-2

Major links in the value chainMajor links in the value chain


7-3

Channel functions to be handledChannel functions to be handled

Match volume, amount, offer to customers’ needs

Share information Contact, negotiate with customers Transport and store products


7-4

Planning channel levelsPlanning channel levels

More intermediaries = more levels

Zero-level = direct to customer

One-level = one type of intermediary

Each level must add value, get profit


7-5

Choosing channel membersChoosing channel members

Intensive distribution = many outlets

Selective distribution = fewer outlets

Exclusive distribution = fewest outlets


7-6

Internal influences on channel Internal influences on channel strategystrategy

Direction, goals, objectives

Resources and core competencies

Marketing activities

Need for control


7-7

External influences on channel External influences on channel strategystrategy

Customers and markets

Environmental factors

Competitors

Intermediary availability


7-8

Planning logisticsPlanning logistics

Manage flows through value chain

Make decisions about: • Storage and inventory• Order processing/fulfillment• Transportation


7-9

Chapter 8: Developing Pricing Strategy


8-1

Types of pricingTypes of pricing

Fixed pricing• Customers pay the price set by marketer

Dynamic pricing• Prices vary from customer to customer or

situation to situation


8-2

How customers define valueHow customers define value

The difference between:

total perceived benefits (features, quality, service, performance, etc.)

and total perceived price (purchase price,

repair costs, shipping costs, etc.)


8-3

How pricing affects demandHow pricing affects demand

Elastic demand • Small price change significantly increases

or decreases the amount demanded

Inelastic demand• Price change does not significantly affect

the amount demanded


8-4

Planning value-based pricingPlanning value-based pricing

Start with customers’ perceptions of value and price they will pay

Use target costing to allow for profit or other objectives


8-5

Planning pricing objectivesPlanning pricing objectives

Relate to financial, marketing, societal objectives

Must be consistent with each other and with the mission and direction


8-6

External influences on pricingExternal influences on pricing

Customers• Perceptions of value, behavior, attitudes

Competitors• Alternatives available to customers

Channel members• Channel profit considerations

Legal, regulatory, ethical concerns• Decision consequences


8-7

Sample pricing in retail channelSample pricing in retail channel


8-8

$0

$5

$10

$15

$20

$25

$30

$35

$40

Outbound movement in value chain

Price in dollars $20 $24 $36

Producer Wholesaler Retailer

Internal influences on pricingInternal influences on pricing

Break-even• Level at which revenue covers costs

Marketing mix decisions• Appropriate for product life cycle, context


8-9

Break-even analysisBreak-even analysis

Exhibit source: Tim Berry and Doug Wilson, On Target: The Book on Marketing Plans (Eugene, OR: Palo Alto Software, 2000), 163.


8-10

Options for adapting pricesOptions for adapting prices

Discounts and allowances

Bundling/unbundling

Product enhancement

Segment pricing


8-11

Chapter 9: Developing Integrated Marketing

Communication Strategy


9-1

Applying integrated marketing Applying integrated marketing communication (IMC)communication (IMC)

Coordinate message content/delivery

Ensure consistency of communications

Support the positioning and direction


9-2

Planning for IMCPlanning for IMC


Define target

audience

Select IMCtools

Plan research

Setobjectives

and budget

Analyzeissues

9-3

Who will be targetedWho will be targeted?

Exhibit source: Gary Armstrong and Philip Kotler, Marketing: An Introduction 7e (Upper Saddle River, NJ: Prentice Hall, 2005), 405.


9-4

IMC objectives and budgetIMC objectives and budget

Establish specific IMC objectives• Identify targeted audience(s)• Influence behavior, feelings, or attitudes• Indicate timing

Develop the IMC budget• Part of overall marketing budget• Consider objectives, IMC tools, markets

targeted, competition, potential ROI


9-5

Issues in IMC planningIssues in IMC planning

Legal/regulatory

Ethical

Cultural

Competitive


9-6

PersonalSelling

DirectMarketing

PublicRelations

Sales Promotion

Advertising

MAJORIMC

TOOLS


9-7

Planning advertisingPlanning advertising


Market scale• Local, regional, national, global

Media choices• Reach vs. frequency; radio, outdoor, print, Internet, TV, direct mail, other

Message content• Rational appeal or emotional appeal; design, wording, format, graphics, sound, other

Target audience characteristics• Demographic, geographic, psychographic, behavioral, media habits

9-8

Planning sales promotionPlanning sales promotion

Audiences• Consumers, channel, salespeople

Objectives• Build awareness, support IMC campaign• Encourage trial/usage/repurchase• Reinforce loyalty, defend against rivals • Encourage speedy response


9-9

Planning public relationsPlanning public relations

Audiences• Customers/prospects, employees,

channel members, government officials, special interest groups, analysts, other

Objectives• Understand public perceptions• Enhance image, build awareness• Communicate views and information


9-10

Planning personal sellingPlanning personal selling

One-on-one attention

Apply the sales process• Identify and qualify prospects• Plan presales approach • Make sales contact• Handle objections, close the sale• Follow up after the sale


9-11

Chapter 10: Planning Performance Management

and Implementation Control


10-1

Metrics

Schedules

Budgets

Forecasts

TOOLS FORMEASURINGPROGRESS


10-2

Using forecastsUsing forecasts

Estimate future sales and costs

Consider external and internal factors

Think about best-case, worst-case, most likely scenario


10-3

Tools for forecastingTools for forecasting

Causal analysis methods • Regression analysis, econometric models

Time series methods• Smoothing, decomposition

Judgmental tools• Delphi method, sales force estimates,

executive opinion


10-4

Budgeting for marketingBudgeting for marketing

Affordability budgeting

Percentage-of-sales budgeting

Competitive-parity budgeting

Objective-and-task budgeting


10-5

Scheduling marketing programsScheduling marketing programs

List main tasks and activities

Assign starting/ending dates

Identify who is responsible for each


10-6

Why use marketing metrics?Why use marketing metrics?

Focus employees on key tasks

Establish performance expectations that can be measured

Allow internal accountability, pride in accomplishments


10-7

Sample marketing metricsSample marketing metrics

New customer acquisition• Count new customers attracted within a

year, a quarter, a month

Profitability• Measure gross or net margin per product

or brand for given period


10-8

Applying marketing metricsApplying marketing metrics

Consider expected outcomes

Consider historical results

Consider competitive/industry results

Consider environmental factors


10-9

Controlling implementationControlling implementation


Annual plan control

Check progress toward marketing plan and program objectives

Profitability control

Check progress toward profit-related objectives

Productivity control

Check progress toward higher efficiency in marketing activities

Strategic control

Check effectiveness in managing marketing, relationships, ethics, social responsibility

10-10

Preparing contingency plansPreparing contingency plans

Consider significant, unexpected changes and emergencies

Review and update regularly

Apply lessons learned to next plan


10-11

Chapter 1: Introduction to Marketing Planning Presentation © 2005 Marian Burk Wood - all rights reserved 1-1.

Documents

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