Winning Markets: Market-Oriented Strategic Planning

Topic Two: Company and marketing strategy

Objectives

• Corporate and division strategic planing• Business unit planning• The marketing process• Product level planning• The marketing plan

Market-Oriented Strategic Planning

Objectives

Skills

Resources

Opportunities

?

Market-Oriented Strategic Planning

Objectives

Skills

Resources

Opportunities

Profitand

Growth

Corporate Headquarters Planning

• Define the corporate mission• Establish strategic business units (SBUs)• Assign resources to SBUs• Plan new business, downsize older businesses

Strategic-Planning, Implementation, and Control Process

Measuringresults

Diagnosingresults

Takingcorrective

action

ImplementationImplementationPlanningPlanning

Corporateplanning

Divisionplanning

Businessplanning

Productplanning

Organizing

Implementing

ControlControl

Defining a market-oriented mission

Limited number of goals

Stress major policies & values

Define competitive scopes

The Boston Consulting Group’s Growth-Share Matrix

20%-18%-16%-14%-12%-10%- 8%- 6%- 4%- 2%- 0

Mar

ket

Gro

wth

Rat

e

3 ?Question marks

? ??21

Cash cow

6

Dogs

8

710x 4x 2x 1.5x 1x

Relative Market Share.5x .4x .3x .2x .1x

Stars

5

4

Market Attractiveness: Competitive- Position Portfolio Classification

MA

RK

ET

AT

TR

AC

TIV

EN

ES

SM

AR

KE

T A

TT

RA

CT

IVE

NE

SS 5.005.00

3.673.67

2.332.33

1.001.00

Lo

wL

ow

Med

ium

Med

ium

Hig

hH

igh

Reliefvalve

Flexiblediaphragms

Fuelpumps

Aerospacefittings

Clutches

Hydraulicpumps

Joints

StrongStrong MediumMedium WeakWeakBUSINESS STRENGTHBUSINESS STRENGTH

1.001.002.332.333.673.675.005.00

Invest/growInvest/grow Selectivity/earningsSelectivity/earnings Harvest/divestHarvest/divest

Sal

esS

ales

10105500Time (yearsTime (years)

The Strategic-Planning Gap

Desiredsales

Desiredsales

Integrative growth

Intensive growth

CurrentportfolioCurrentportfolio

Strategic-Strategic-planningplanning

gapgap

DiversificationDiversification growthgrowth

Three Intensive Growth Strategies: Ansoff’s Product/Market Expansion Grid

4. Diversification2. Marketdevelopment

Newmarkets

1. Marketpenetration

Existingmarkets

Existingproducts

3. Productdevelopment

Newproducts

1

4

2

3

HighHigh

LowLow

HighHigh LowLow

Att

ract

iven

ess

Att

ract

iven

ess

Success ProbabilitySuccess Probability OpportunitiesOpportunities

Opportunity Matrix

1. Company develops a more powerful lighting system

2. Company develops a device for measuring the energy efficiency of any lighting system

3. Company develops a device for measuring illumination level

4. Company develops a software program to teach lighting fundamentals to TV studio personnel

Threat Matrix

1. Competitor develops a superior lighting system

2. Major prolonged economic depression

3. Higher costs4. Legislation to reduce

number of TV studio licenses

1

4

2

3

HighHigh

LowLow

HighHigh LowLow

Ser

iou

snes

sS

erio

usn

ess

Probability of OccurrenceProbability of Occurrence ThreatsThreats

Sell the product

The Value-Delivery Process

Make the product

ProcureDesignproduct Make Price Sell Advertise/

promote Distribute Service

Choose the Value Provide the Value Communicate the Value

(a) Traditional physical process sequence

(b) Value creation & delivery sequence

Strategic marketing Tactical marketing

The Marketing Plan

Executive Summary & Table of Contents

Current Marketing Situation

Opportunity & Issue Analysis

Objectives

Marketing Strategy

Action Programs

Projected Profit-and-loss

Controls

Competitors

Marketingintermediaries

PublicsSuppliers

Factors Influencing Company Marketing Strategy

Mar

ketin

g

info

rmat

ion

syst

em

Marketing

planningsystem

Marketing

organization

system Mar

ketin

g

orga

niza

tion

and

impl

emen

tatio

n

Product

Promotion

Place PriceTargetcustomers

Demographic/economic

environment

Social/cultural

environment

Technical/physical

environment

Political/legal

environment