The Strategic Marketing Process
Developing A Marketing Plan
Five Purposes of a Marketing Plan
Explains present and future situations of the firm Specifies goals and objectives so the company can anticipate its situation at end of the period
Describes specific actions to take place so that responsibility for each can be assigned
Identifies resources that will be needed to carry out all planned actions Permits the monitoring of actions and results so controls may be implemented
Marketing Plan Structure
Outline used is not important so long as it includes all relevant information
Structure should be logical, easy to follow and tells its message clearly Structure should be flexible to adapt to unique situations and characteristics
Any marketing plan is just a framework, not a series of sequential planning steps
Many elements are decided simultaneously, such as marketing strategy and implementation
Structure of A Typical Marketing Plan
Executive Summary and Table of Contents Environmental Analysis SWOT Analysis (Opportunities & Threats) Marketing Goals & Objectives Marketing Strategy Action Programmes (Implementation)
Evaluation (Projected profit/loss)
Controls
Executive Summary
Synopsis of the overall marketing plan with outline that conveys main strategic drive and execution Provides an overview of plan Facilitates identification of key issues or concerns by other departments Does NOT provide detailed information found in other sections (environmental or SWOT analysis) DOES include major plan aspects, including sales projections, costs, and performance measures
Environmental Analysis
Summarises all pertinent information about: External environment Customer environment (target markets) Internal environment External Environment Economic, competitive, social, political/legal, technological, natural Customer Environment Current needs of target market(s) and anticipated changes How well current products meet needs/changes Internal Environment HR, equipment, finances, internal politics, etc.
SWOT Analysis
Focus is Internal: Strengths (S) and Weaknesses (W) Focus is External: Opportunities (O) and Threats (T) Derived from environmental analysis SWOT should be analysed relative to market needs and competitive activities Identifies areas for emphasis or improvement
Marketing Goals and Objectives
Formal statements about desired/expected outcomes from the marketing plan
Based on the SWOT analysis Objectives should match strengths & opportunities and/or convert weaknesses & threats All marketing goals should be based on the firm’s mission in the marketplace Marketing objectives should flow directly from the marketing goals
Marketing Strategies
How the firm will achieve its objectives
How the firm will manage its relationship with customers for competitive advantage Target market selection Segmentation variables How mix will satisfy target customers for competitive advantage - doing something better than competition What will the reaction be to implementing the chosen strategy?
Marketing Implementation
What specific actions will be taken? How will these activities be performed? When will these activities be performed? Who is responsible for these activities? How will activities by monitored? How much will the activities cost?
Evaluation and Control
How results will be evaluated & controlled: Financial assessment of plan, based on sales, cost, and revenue estimates
Budgetary considerations play key role in identification of alternative strategies
Marketing control:
Establish performance standards (volume/share increases, profitability, advertising etc.) Assess actual performance Determine cause(s) of discrepancies and take corrective action when necessary
Problems with Marketing Plans
Industrial
Hard to get consensus/cooperation Not enough time to prepare Hard to make forecasts 18% 16 10
Consumer
5% 18 8
Service
21% 7 0
Plan not taken seriously enough
Company isn’t market-oriented Too much focus on short term Not enough useful information Unrealistic top management goals Not enough top mgmt commitment Not enough strategic thinking Market changes too fast Have to plan too far ahead
5
2 2 8 5 3 4 4 3
0
3 7 8 5 3 3 3 2
10
14 0 3 3 3 7 3 0
Inertia/resistance to change
1
5
3
Source: Howard Sutton, The Marketing Plan in the 1990’s. New York: The Conference Board, 1990. 61.
Using the Marketing Plan
Marketing plans only as good as information they contains + effort put in
Importance of having a system of collecting all relevant marketing information is crucial
A marketing plan is no substitute for managerial judgment Managerial intuition and judgment are essential in marketing planning
A good marketing plan can sell itself
Using the Marketing Plan (cont.)
Completion of the formal, written plan is not the most critical goal - more important is that the plan is approved and resources are provided To give a marketing plan a chance for success, little time should elapse between completion of plan and implementation Creation of plan is an important milestone, but not the final step in strategic market planning
Due to changing environments the plan must be able to be adjusted on an ongoing basis
Major Shortcomings of Marketing Plans
Industrial
Not realistic enough 19%
Consumer
14%
Service
11%
Too much emphasis on short term
Not specific enough Not enough market information Not taken seriously enough Inadequate performance measures Not sufficiently up-to-date Not enough strategic emphasis Not enough competitive analysis Objectives not well defined
10
16 16 13 8 9 12 17 3
14
12 16 9 12 18 14 5 11
26
33 11 15 15 7 7 7 15
Not enough focus on customers
Not integrated with other plans
3
7
11
2
4
4
Source: Howard Sutton, The Marketing Plan in the 1990’s. New York: The Conference Board, 1990, page 62
Using the Marketing Plan Requires...
Ongoing system of collecting relevant marketing information Good managerial judgment Top management’s approval and provision of sufficient resources to implement Convincing non-marketing areas to fulfill their role Being flexible enough to adjust plan as necessary