Module 2 Develop Market Strategies and plan Dr. Mohamed Zamil AL- Akhtaby
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Module 2
Develop Market Strategies
and plan
Dr. Mohamed Zamil AL-Akhtaby
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.
Steps in Strategic Planning
Defining theCompanyMission
Setting Company
Objectivesand Goals
Designingthe Business
Portfolio
Planning, marketing,and other functionalStrategies
Corporate LevelBusiness unit,
product,and market
level
Vision statementDefines your
long-term dream
It’s inspirational statement
- WHAT TO DO?
Vision & Mission Statement
Mission StatementProducts and
services provided
your business – values
- HOW TO DO?
Nokia
Vision :Our vision is a world where everyone can be connected
Mission :
Nokia helps people to fulfill this need and we help people feel close to what matters to them. We focus on providing consumers with very recent technology that is a joy to use, and beautiful.
Otsuka Pharmaceutical Co.
VisionIs the creation of products to serve the better health of people around the world.
MissionClinical studies are carried in research centers in the USA ,Germany, UK and Japan aiming for products of universal value. With a collaboration among marketing, research sectors so that customers' real needs may be feedback for further product development.
Companywide Strategic Planning
• The mission statement is the organization’s purpose, what it wants to accomplish in the larger environment
• Market-oriented mission statement defines the business in terms of satisfying basic customer needs
Defining a Market-Oriented mission
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
Defining a Market-Oriented Mission
We help you organize the world’s information and make it universally accessible and useful.
Steps in Strategic Planning
Defining theCompanyMission
Setting Company
Objectivesand Goals
Designingthe Business
Portfolio
Planning, marketing,and other functionalStrategies
Corporate LevelBusiness unit,
product,and market
level
Setting Company Objectives and Goals
Steps in Strategic Planning
Defining theCompanyMission
Setting Company
Objectivesand Goals
Designingthe Business
Portfolio
Planning, marketing,and other functionalStrategies
Corporate LevelBusiness unit,
product,and market
level
Company wide Strategic Planning
Analyzing the Current Business Portfolio
• Strategic business unit (SBU) is a unit of the company that has a separate mission and objectives that can be planned separately from other company businesses
Corporate Level
DivisionLevel
BusinessUnit Level
MarketingLevel
Company wide Strategic Planning
Analyzing the Current Business Portfolio
Company wide Strategic Planning
• 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
Designing the Business Portfolio
Company wide Strategic Planning
Analyzing the Current Business Portfolio
1. Identify key businesses (strategic business units, or SBUs) that make up the company
2. Assess the attractiveness of its various SBUs
3. Decide how much support each SBU deserves
Analyzing Current SBU’s:Boston Consulting Group Approach
Question Marks
• High growth, low share • Build into Stars or phase out • Require cash to hold market share
Question Marks
• High growth, low share • Build into Stars or phase out • Require cash to hold market share
Stars
• High growth & share• Profit potential • May need heavy investment to grow
Cash Cows
• Low growth, high share• Established, successful SBU’s•Produce cash
Cash Cows
• Low growth, high share• Established, successful SBU’s•Produce cash
Dogs
• Low growth & share • Low profit potential
Dogs
• Low growth & share • Low profit potential
?
Relative Market ShareHigh Low
Mar
ket G
row
th R
ate
Low
H
igh
Can be Difficult, Time-Consuming, & Costly to ImplementCan be Difficult, Time-Consuming, & Costly to Implement
Difficult to Define SBU’s & Measure Market Share/ GrowthDifficult to Define SBU’s & Measure Market Share/ Growth
Focus on Current Businesses, But Not future PlanningFocus on Current Businesses, But Not future Planning
Can Lead to Unwise Expansion or DiversificationCan Lead to Unwise Expansion or Diversification
Problems With Matrix Approaches
1. Market Penetration
2. Market Development
3. Product Development
4. Diversification
ExistingMarkets
NewMarkets
ExistingProducts
NewProducts
Developing Strategies for Growth and Downsizing Product/market expansion grid strategies
Product/ Market Expansion Grid
Corporate Growth Strategies• Market Penetration is a
strategy for company growth by increasing sales of current products to current market segments without changing the product– Increase market share– Increase product usage
• Increase frequency of use
• Increase quantity used• Communicate new
applications for the product.
Corporate Growth Strategies• Market Development
is a strategy for company growth by expanding markets for existing products Targeting new
segments Nonusers Occasional users
Geographic expansion
Developing more distribution channels
Exporting to new countries
• Product Development is a strategy for company growth by offering modified or new products to current market segments Product-line
extensionNew products
Corporate Growth Strategies
NESPRESSO
• Founded 2000
• Growth rate 30%
• 50 Countries
• Quality (Coffee, Machine)
• Customer delight (Internet call center 7M)
• B2B
Corporate Growth Strategies• Integration
• Backward Integration• Forward integration
– Pros• Access to scarce
resources of supply• Tighter control over its
value delivery network
– Cons• Risk inherent in
committing substantial resources in one business.
• Investment incurred often offsets the additional profitability
Corporate Growth Strategies• Concentric (related)
Diversification occurs when a firm internally develops or acquires another business that may or may not have customers in common with its current businesses but that might contribute to internal synergy such sharing production facilities or marketing and distribution skills.
Corporate Growth Strategies• Conglomerate (Unrelated) Diversification
involves two businesses that have no commonalities. Reasons for engaging in such strategy may be:– Decrease in demand on core company businesses.– Company has more cash than it needs to expand its
current business– Targeted growth is not achieved by other strategies
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