MARKETING MANAGEMENT 13 th edition 2 Developing Marketing Strategies and Plans Kotler Keller
MARKETING MANAGEMENT 13 th edition 2 Developing Marketing Strategies and Plans KotlerKeller.
Jan 12, 2016
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MARKETING MANAGEMENT13th edition
2 Developing
Marketing Strategies and Plans
Kotler Keller
CHP: 2&11-2
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.
CHP: 2&11-3
The Value Delivery Process
CHP: 2&11-4
Improving Value Delivery the Japanese Way
0 customerfeedback time
0 product improvement time
0 setup time
0 defects0
purchasing time
CHP: 2&11-5
Porter’s Value Chain
CHP: 2&11-6
Core Business Processes
Market sensing
Fulfillmentmanagement
Customer acquisition
New offering realization
Customer relationship management
CHP: 2&11-7
Characteristics of Core Competencies
• A source of competitive advantage
• Applications in a wide variety of markets
• Difficult to imitate
CHP: 2&11-8
What Is Strategy?
Strategy is creation of a unique and valuable position, involving a different set of activities.
Choosing to perform activities differently than rivals do.
Essence of strategy is choosing what not to do.
CHP: 2&11-9
What Is Strategy?
Serving few needs of many customersServing broad needs of few customersServing broad needs of many customers in a
narrow market
Trade-offs create need for choiceTrade-offs protect against imitators
CHP: 2&11-10
Levels of a Marketing Plan
• Strategic– Target marketing
decisions– Value proposition– Analysis of
marketing opportunities
• Tactical– Product features– Promotion– Merchandising– Pricing– Sales channels– Service
CHP: 2&11-11
The Strategic Planning, Implementation, and Control Processes
CHP: 2&11-12
Elements of a Strategy Statement
–OBJECTIVE: Ends
–SCOPE: Domain
–ADVANTAGE: Means
CHP: 2&11-13
Elements of a Strategy Statement: Objective
OBJECTIVEDefinition of ends that strategy is designed to achieve.
Mission:
Statements of ultimate purpose
Underlying motivation for being in business
Values:
Ethical values under which company operates
CHP: 2&11-14
Elements of a Strategy Statement: Scope
SCOPEDomain of business.
Boundaries beyond which company will not venture.
Customers: Who is / Who is not
Offerings: What is / What is not
Geography: Where is / Where is not
CHP: 2&11-15
Elements of a Strategy Statement: Advantage
ADVANTAGEMeans by which company will achieve stated objectives.
Value proposition: Why should customers buy from us?
Competitive advantage: What makes us distinctive?
CHP: 2&11-16
Strategy Statement
1) Detailed understanding of customer needs
2) Segmenting customers
3) Choosing segments to serve
4) Creating value for the targeted segment
Analyze and monitor competitors’ current strategies Predict how they might change
CHP: 2&11-17
Steps in Strategic Planning
Defining theCompanyMission
Defining theCompanyMission
Setting CompanyObjectivesand Goals
Setting CompanyObjectivesand Goals
Designingthe Business
Portfolio
Designingthe Business
Portfolio
Planning, marketing,and other functionalStrategies
Planning, marketing,and other functionalStrategies
Corporate LevelBusiness unit,
product,and market
level
CHP: 2&11-18
Corporate headquarters’ planning activities
Define the corporate missionEstablish SBUsAssign resources to each SBUAssess growth opportunities
CHP: 2&11-19
Good Mission Statements
Focus on limited number of goalsFocus on limited number of goals
Stress major policies and valuesStress major policies and values
Define major competitive spheresDefine major competitive spheres
CHP: 2&11-20
Market OrientedMarket Oriented
RealisticRealistic
Fit Market EnvironmentFit Market Environment
Distinctive CompetenciesDistinctive Competencies
MotivatingMotivating
Specific
Characteristics of a Good Mission
Statement:
A Mission Statement is a Statement of the Organization’s Purpose.
Defining the Company’s Business and Mission
CHP: 2&11-21
Major Competitive Spheres
Industry
Products
Marketsegment
Geographical
CompetenceVerticalchannels
CHP: 2&11-22
Product Orientation vs. Market Orientation
Company Product Market
Missouri-Pacific Railroad
We run a railroad We are a people-and-goods mover
Xerox We make copying equipment
We improve office productivity
Standard Oil We sell gasoline We supply energy
Columbia Pictures We make movies We entertain people
CHP: 2&11-23
Characteristics of SBUs
• It is a single business or collection of related businesses
• It has its own set of competitors
• It has a leader responsible for– Strategic planning– Profitability– Efficiency
CHP: 2&11-24
Analyzing Current SBU’sThe Boston Consulting Group’s Growth-Share Matrix
CHP: 2&11-25
Business Strength
High
Medium
Low
Strong Average Weak
A
B
C
D
Ind
ustr
y
Att
racti
ven
ess
Analyzing Current SBU’s:GE’s Strategic Business-Planning Grid
CHP: 2&11-26
Five Forces Determining Segment Structural Attractiveness
CHP: 2&11-27
Five Competitive Forces
Not all forces are always present or equally critical.
Strongest Force Profitability
Example: Starbucks (specialty coffee retailing)Which threat is most critical?Force is the threat not whether it actually occurs.
CHP: 2&11-28
Ansoff’s Product-Market Expansion Grid
CHP: 2&11-29
The Business Unit Strategic Planning Process
CHP: 2&11-30
SWOT Analysis
Strengths
Weaknesses
Opportunities
Threats
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Market Opportunity Analysis (MOA)• Can the benefits involved in the opportunity
be articulated convincingly to a defined target market?
• Can the target market be located and reached with cost-effective media and trade channels?
• Does the company possess or have access to the critical capabilities and resources needed to deliver the customer benefits?
CHP: 2&11-32
Market Opportunity Analysis (MOA)-2• Can the company deliver the benefits better
than any actual or potential competitors?
• Will the financial rate of return meet or exceed the company’s required threshold for investment?
CHP: 2&11-33
Executive Summary
Current Marketing Situation
Threats and Opportunity Analysis
Objectives and Issues
Marketing Strategy
Action Programs
Budgets
Controls
Contents of a Marketing Plan
CHP: 2&11-34
Evaluating a Marketing Plan
Is the plan simple? Is the plan specific? Is the plan realistic? Is the plan complete?
MARKETING MANAGEMENT13th edition
11 Dealing with Competition
Kotler Keller
CHP: 2&11-36
Industry Concept of Competition
• Number of sellers and degree of differentiation
• Entry, mobility, and exit barriers
• Cost structure
• Degree of vertical integration
• Degree of globalization
CHP: 2&11-37
Industry Concept of Competition
Pure MonopolyPure Monopoly
OligopolyOligopoly
Monopolistic CompetitionMonopolistic Competition
Pure CompetitionPure Competition
CHP: 2&11-38
Steps in Analyzing Competitors
Identifying the company’scompetitors
Assessing competitor’s objectives, strategies,strengths and weaknesses,and reaction patterns
Selecting whichcompetitors toattack or avoid
CHP: 2&11-39
Competitor Map
CHP: 2&11-40
Analyzing Competitors
Share of marketShare of market
Share of mindShare of mind
Share of heartShare of heart
CHP: 2&11-41
Overall CostLeadership
Overall CostLeadership
DifferentiationDifferentiation
FocusFocus
Middle ofthe RoadMiddle ofthe Road
Porter’s Generic Competitive Strategies
CHP: 2&11-42
Competitive Strategies: Value Disciplines
Operational Excellence
Customer Intimacy
Product Leadership
Companies Gain Leadership Positions by Delivering Superior Value to their Customers Through These Strategies:
CHP: 2&11-43
Value Disciplines: Operational Excellence
Operational ExcellenceProviding products at competitive pricesDelivering with minimal difficulty or inconvenience
Lead industry in PriceConvenience
CHP: 2&11-44
Value Disciplines: Customer Intimacy
Customer IntimacySegmenting and targeting precisely and tailoring offerings to match exactly what is demanded.Continuous tailoring and shaping of products to fit increasingly fine definition of customer.
Detailed customer knowledgeOperational flexibilityQuick responseLifetime value vs transaction
Extreme Loyalty
CHP: 2&11-45
Value Disciplines: Product Leadership
Product LeadershipOffering leading-edge productsEnhance customer’s use or application of the productThus, make rivals’ goods obsolete
Continuous stream of state-of-the-art products requires:CreativityQuick commercializationRelentlessly pursuing new solutions
CHP: 2&11-46
Choosing Value Disciplines vsChoosing Customers
Choice of business discipline and customer category is a single choice.
Customer Categories:Defines value by price, convenience, quality matrix (price dominant)Concerned with obtaining precisely what they wantNew, different, unusual products count most
CHP: 2&11-47
Hypothetical Market Structure
10%
Market
Nichers
20%
Market
Follower
30%
Market
Challenger
40%
Market
Leader
CHP: 2&11-48
Firm With the Largest Market Share
Firm With the Largest Market Share
Expand theTotal MarketExpand theTotal Market
Protecting Market ShareProtecting
Market Share
Expanding Market ShareExpanding
Market Share
Competitive Marketing Strategies
Runner-Up Firms that Fightto Increase Market Share
Runner-Up Firms that Fightto Increase Market Share
Attack theMarket Leader
Attack theMarket Leader
Avoid the Market Leader
Avoid the Market Leader
Acquire SmallerFirms
Acquire SmallerFirms
Attack OtherFirms
Attack OtherFirms
CHP: 2&11-49
Specific Attack Strategies
• Price discounts• Lower-priced goods• Value-priced goods• Prestige goods• Product proliferation
• Product innovation• Improved services• Distribution innovation• Manufacturing-cost
reduction• Intensive advertising
promotion
CHP: 2&11-50
Runner-Up Firms that Wantto Hold Their Share Without
Rocking the Boat
Runner-Up Firms that Wantto Hold Their Share Without
Rocking the Boat
Follow CloselyFollow Closely
Follow at aDistance
Follow at aDistance
Competitive Marketing Strategies
Firms that Serve Small Segments Not Pursued by Other Firms
Firms that Serve Small Segments Not Pursued by Other Firms
End-UserSpecialistEnd-UserSpecialist
Customer-SizeSpecialist
Customer-SizeSpecialist
ServiceSpecialistService
Specialist
Quality-Price
Specialist
Quality-Price
Specialist
GeographicMarket
Specialist
GeographicMarket
Specialist
CHP: 2&11-51
Market Follower Strategies
Counterfeiter
Cloner
Imitator
Adapter
CHP: 2&11-52
Market Nicher Strategies
CHP: 2&11-53
Executive Summary
Current Marketing Situation
Threats and Opportunity Analysis
Objectives and Issues
Marketing Strategy
Action Programs
Budgets
Controls
Contents of a Marketing Plan
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