Chapter 2 Strategic Planning for Competitive Advantage.

Marketing 333Chapter 2

Strategic Planning for Competitive Advantage

Strategic PlanningThe process of maintaining a “fit” between an

organization’s resources and objectives AND evolving market opportunities

The goal is LONG-TERM profitability and growth

The Marketing Plan is the blueprint for implementing the long-term goals of the company.

The Market PlanInvolves designing

marketing activities to meet marketing objectives

Considers changing marketing environment

Contains decisions for all elements of the marketing strategy AND the basis for those decisions

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Marketing Plan Elements

Marketing Strategy

Product Distribution

Price

Marketing Mix

Business Mission Statement

Objectives

Situation or SWOT Analysis

ImplementationEvaluationControl

Target Market Strategy

ImplementationEvaluation

Control

Promotion

Writing the Marketing PlanStep 1

Define the Business Mission What business are we in? Focus on the market rather than the good or service May need to be defined by strategic business unit

(SBU)

A mission that is too narrow may be the result of marketing myopia

A mission that is too broad doesn’t provide direction

Writing the Marketing PlanStep 2 – Setting the marketing plan objectives

Must be:RealisticMeasureableTime specificConsistent with the organizational mission and

priorities

Writing the Marketing PlanStep 3 – Conduct a situation analysis (SWOT)

©South-Western College Publishing

SSWWOOTT

Things the company does well.Things the company does well.

Things the company does not do well.Things the company does not do well.

Conditions in the external environment that favor strengths.

Conditions in the external environment that favor strengths.Conditions in the external environment that do not relate to existing strengths or favor areas of current weakness.

Conditions in the external environment that do not relate to existing strengths or favor areas of current weakness.

Internal

External

Writing the Marketing PlanStep 4 – Identify the firm’s competitive

advantage

Competitive advantage is the set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition.

Types of Competitive AdvantageCost-basedProduct/service differentiationNiche strategies

Sources of Cost ReductionExperience CurvesEfficient laborNo frills goods and

servicesGovernment subsidiesDesign technologyReengineeringProduction innovationsNew product delivery

methods

Product/Service Differentiation to Create Competitive AdvantageExists when a

firm provides something unique to buyers other than low price.

E.g. Maytag offers innovative designs and product reliability

Niche Competitive AdvantageThe organization

targets and effectively serves a single segment of the market.

The Scooter Store

Sustainable Competitive AdvantageCompetitive

advantage that cannot be copied by the competition.

Writing the Marketing PlanStep 5 – Select a strategic alternative

Tools to help include:

Strategic opportunity matrix (Product/Market matrix)

Portfolio matrix (BCG matrix)

Strategic Opportunity Matrix (Market/Product Matrix)

Strategic Opportunity Matrix (Market/Product Matrix)

Old/ExistingMarkets

NewMarkets

Old/ExistingProducts

NewProducts

MARKETPENETRATION

MARKETDEVELOPMENT

PRODUCTDEVELOPMENT

DIVERSIFI-CATION

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Portfolio Matrix

Stars

Cash Cows

ProblemChildren

Dogs

Writing the Marketing PlanStep 6 – Select and describe one or more

target markets

Segment the market based on groups with similar characteristics

Analyze the market based on groups with similar characteristics

Select one or more target markets

Target market Strategies

Entire Market Multiple Markets

Single Market

Target Market Options

Writing the Marketing PlanStep 7 – Develop and state the marketing mix (4 Ps) strategies.

ProductPricePlace (Distribution)Promotion

Step 8 - Implementation of the Marketing PlanImplementation

activities include job assignments, activity descriptions, timelines, budgets, etc.

Turns the written marketing plan into actions.

Step 9 - Evaluation and ControlDid we accomplish

what we planned to accomplish?

Why or why not?May require a

marketing audit