Marketing Planning & Strategy
Marketing Planning & Strategy
Marketing Planning & Strategy
STRATEGY
Rahul Gandhi
• Congress launched him as their marketing
weapon
• He has added a new constituency” the youth “
• Shows freshness , sincerity , positivity – all of
which is a rare combination amongst the
politicians
• Political scion gifted with a glorious smile
Virgin Mobile
• Decided to target youngistan – focused
exclusively on youth
• Focus on communication where the youth
“ gets around “ not necessarily rebels
..they find a way
• Introduced many first “ including ..get paid
to receive a call” -Cut clutter
• It has achieved a 92 % awareness , and
69 % consideration a year since its launch
Rakhi Sawant
• From an item girl she became the biggest
start for NDTV imagine
• As a brand she is brash , crude , willingly
flaunts her unsophistication
• Her appeal connected with the masses
•
Sun Tze on Strategy
• “Know your enemy, know yourself,
and your victory will not be
threatened. Know the terrain,
know the weather, and your
victory will be complete.”
Strategic Marketing Planning
Changing Environment
Strategic Marketing
SMART
STRATEGIC MANAGEMENT
Marketing
Capital
Financial
Plan
Project Strategy Plan
Public Offering Management
Financial
Controlling
Business
Strategy
Management
Plan
Salesforce
Operations
Sales
Infrastructure Program
Legal FDA
Regulations
Production &
Logistics
All stakeholders will benefit from the
business strategy approach
Project Management Plan
Business Strategy
Agency 1
Momentum
Positioning
Tactics
Marketing Promotion Policy
Strategy Communication
Market
Plan Product Mix
Branding
Bus. Review
Target market
Definition
Positioning
Communication
Branding
Strategy
Tactics
The Role of Strategy
Corporate Strategy:
Mission & •Corporate Operatin
Objectives •Business g Plans
•Functional
Funnel
PURPOSE OF
STRATEGY
To set the future direction for the organisation.
CORPORATE
SBUs
FUNCTIONAL AREAS
3 LEVELS OF STRATEGY
Corporate
The overall goals of the business; often expressed in financial
terms
Competitive/Business (SBU)
How to compete in individual product-markets and support the
corporate strategy
Functional
Functional strategies for the organisation’s functional areas in
support of SBUs and corporate strategies
What is a Strategic
Business Unit? (SBU)
• A set of products or product lines
– With clear independence from other
products or product lines
– for which a business or marketing strategy
should be designed
Types Of Strategies
Who are our target customers & what are their needs?
Orderly thinking
THINKING FIRST
SIMPLE RULES
ENVIRONMENTAL ANALYSIS
Environmental scanning is the process of gathering
information about the various forces in the environment.
It involves observation, perusal of secondary sources,
such as business, trade, government and general
interest publications and marketing research.
SWOT
• SWOT Analysis
Identifies Organization’s Strengths, Weaknesses, Opportunities, and Threats
–
Core Competency
•
A special strength that gives an organization a competitive advantage
–
STRATEGY FORMULATION
Product
Mkt penetration development
Current
strategy strategy
Mkts
Strategy Implementation
• Strategic Leadership
– the capability to inspire people to successfully
engage in a process of continuous change,
performance enhancement, and
implementation of organizational strategies.
Marketing at the SBU Level—
Strategic Marketing
– Diversification
• Concentric
• Retrenchment strategies
• Conglomerate
– Turnaround
– Captive Company
– Sell-Out/Divestment
– Bankruptcy/Liquidation
The Competitive Environment
Kinds of Markets
Competitor Analysis
Key
Concepts
in the Competitive Rivals
Competitive
Environment
Competitive Barriers
Information on Competitors
What is Competitive
Advantage?
• “Competitive advantage is a company’s
ability to perform in one or more ways
that competitors cannot or will not
match.” Philip Kotler
• “If you don’t have a competitive
advantage, don’t compete.” Jack
Welch, GE
Other Characteristics of
Competitive Advantage
• Substantiality
– Is it substantial enough to make a difference?
• Sustainability
– Can it be neutralized by competitors quickly?
• Ability to be leveraged into visible
business attributes that will influence
customers
Encirclement
Flanking Defense
Preemptive
Defense
Contraction
Frontal
Defender Defense
Attacker (bigger)
(smaller)
Attack
Position
Counteroffensive Defense
Guerilla Attack
Mobile Defense
Flank Attack
Bypass
CREATIVE THINKING
6 HATS
Information Emotions ,
Truth ,
seeking ? feelings
reality
Critical thinking
Optimistic
Forward looking
Overview Creative futuristic
Sequence of thinking
thinking
TRAFFIC LIGHTS
• First Look:
Ghajini's marketing started way back from March 20
• when he came out on the premier of RACE with his new
BALD look.
• It actually gave the perfect sneak peek at the two looks
of Aamir in the movie.
• Notice the jacket and rolled up half sleeves?
• Did anyone say Sanjay Singhania?
• And then
– in November, this photo shot across leading dailies
and Aamir without even showing his face and his 8
packs instantly became the talk of the town.
• The 8 pack promotion:
October 2007 and remember SRK and the ho-hallah
around his 6 pack abs.
• It was only around that time that Aamir silently started
working on his own, and just to make it better, he added
a pair and made it eight!
• The fact that the man now had a 8 pack and a fantastic
body, he decided to show the world how he got it!
• Up came the videos with 'Making of Aamir's 8 pack' on
all news and entertainment channels.
• Videos similar to this you tube got thousands of visits!
He even went a step ahead and called a press conference
to introduce his trainer and explain his diet chart!
– Television appearances
With the TV channels filled with Ghajini promos,
Aamir went into overdrive with his interviews, which
came in by the day on every news and entertainment
channel. Not to forget the guest appearances on
reality shows, which is now a sort of a norm.
– Offline Promos at Theaters
– 'Theater personnels with Ghajini hair cut' act that he did on the
release on Rab neBana di Jodi.Simply Fantastic. Imagine going
to a cinema hall to watch RNBDJ and you watch all these Aamir
Khan look alikes and his life size cut outs. You almost wish that
you had come to watch Ghajini!
Co branding
• Tata Sky started running Ghajini “specials” complete
with behind-the-scenes stories of the upcoming
film. Samsung launched special Ghajini edition mobile
phones of L700 and M200 models. These handsets have
preloaded with Ghajini ringtones, pictures and songs.
Tata Indicom started with a outbound dialer service with
Khan's pre-recorded voice.
Co branding
• Van Heusen launched Ghajini's apparels in their stores
all across India and is backing it with in-store campaigns
and giant posters of Khan dressed in formal attire.
Van Heusen also organized a fashion show wherein
models along with Aamir sported the Ghajini look.Add a
little big of jig and a bit of Guzarish and he had all the TV
channels beaming again!
Viral SMS campaign
The
Marketing
Concept
Profit
Profit
Utility and Marketing
From Production
Time
Time
Form
Form
Utility
Utility
Value
Value that
that comes
comes Place
Place
from
from satisfying
satisfying
human
human needs
needs
Task
Task
Possession
Possession
From Marketing
Customer Value
Costs Benefits
• One customer’s views may vary from another
customer’s view, so firm may not be able to satisfy
everybody
• Customer value concept takes the customer’s point
of view, but customers may not explicitly weigh
costs and benefits
The Marketing Management
Process
Whole-Company
Whole-Company
Strategic
Strategic
Management
Management
Planning
Planning
Control
ControlMarketing
Marketing Implement
Implement Marketing
Marketing
Plan(s)
Plan(s)and
andProgram
Program Plan(s)
Plan(s)and
andProgram
Program
The Four Ps of the Marketing Mix
Product Place
C
Price Promotion
Strategy Decision Areas
Product Place Promotion Price
Physical Goods Objectives Objectives Objectives
Service Channel Type Blend Flexibility
Features Market Exposure Salespeople Level over PLC
Quality Level Kinds of Kind Geographic
Accessories Middleman Number Terms
Installation Kinds and Selection Discounts
Instructions Locations of Training Allowances
Warranty Stores Motivation
Product Lines How to Handle Advertising
Packaging Transporting Targets
Branding and Storing Kinds of Ads
Service Levels Media Type
Recruiting Copy Thrust
Middlemen Who Prepares?
Managing Sales Promotion
Channels Publicity
Marketing Strategy Planning Process
Competitors
Strengths Opportunities
Weaknesses Threats
STP
Creaminess
Creaminess
Sweetness Sweetness Sweetness
Market Aggregation – The
Strategy of Mass Marketing
• Advantages & Disadvantages
• Product Differentiation
Step 1. Market Segmentation
Levels of Market Segmentation
Mass
Mass Marketing
Marketing
Same
Same product
product to
to all
all consumers
consumers
(no
(no segmentation)
segmentation)
Segment
Segment Marketing
Marketing
Different
Different products
products to to one
one or or more
more segments
segments
(some
(some segmentation)
segmentation)
Niche
Niche Marketing
Marketing
Different
Different products
products to to subgroups
subgroups within
within segments
segments
(more
(more segmentation)
segmentation)
Micromarketing
Micromarketing
Products
Products toto suit
suit the
the tastes
tastes of
of individuals
individuals and
and locations
locations
(complete
(complete segmentation)
segmentation)
Local Marketing Individual Marketing
Tailoring brands/ promotions Tailoring products/ programs
to local customer groups to individual customers
Steps in the Market
Segmentation Process
Psychographic
Lifestyle or Personality
Behavioral
Occasions, Benefits,
Uses, or Attitudes
Step 1. Market Segmentation
Bases for Segmenting Business
Markets
Personal
Demographics
Characteristics
Bases
Bases
for
for Segmenting
Segmenting
Situational Business
Business Operating
Factors Markets
Markets Characteristics
Purchasing
Approaches
Effective Segmentation
• Size, purchasing power,
Measurable
Measurable profiles of segments can
be measured.
• Segments can be
Accessible
Accessible effectively reached and
served.
• Gender
• Income
• Occupation
• Education
• Family Size or Family Life Cycle
• Religion or Nationality
Geographic Bases
• Region
• Density
• Climate
• Population
Behavioral Bases
• User Status & Brand Loyalty
• Personality/Lifestyle
• Social Class
• Occasion
• Readiness to Buy
• Benefits Sought
• Usage Rate
Step 2. Market Targeting
Evaluating Market Segments
Segment Size and Growth
Analyze sales, growth rates and expected
profitability
Segment Structural
for various Attractiveness
segments.
Consider effects of: Competitors, Availability of
Substitute Products and, the Power of Buyers &
Suppliers.
Company Objectives and Resources
Company skills & resources relative to the segment(s).
Look for Competitive Advantages.
Five Patterns of Target Market
Selection
Single-segment Selective Product
concentration specialization specialization
M1 M2 M3 M1 M2 M3 M1 M2 M3
P1 P1 P1
P2 P2 P2
P3 P3 P3
Market Full market
specialization coverage
M1 M2 M3 M1 M2 M3
P1 P1
P = Product
M = Market P2 P2
P3 P3
Step 2. Market Targeting
Market Coverage Strategies
Company
Company
Marketing
Marketing Market
Market
Mix
Mix
A. Undifferentiated Marketing
Company
Company
Marketing Segment
Segment11
MarketingMix
Mix11
Company
Company Segment
Segment22
Marketing
MarketingMix
Mix22
Company
Company Segment
Segment33
Marketing
MarketingMix
Mix33
B. Differentiated Marketing
Segment
Segment11
Company
Company
Marketing Segment
Marketing Segment22
Mix
Mix
Segment
Segment33
C. Concentrated Marketing
Step 2. Market Targeting
Choosing a Market-Coverage
Company Strategy
Resources
Product
Variability
Product’s Life-Cycle
Stage
Market
Variability
Competitors’
Marketing Strategies
Positioning is the act
of designing the
company’s offering
and image to occupy a
distinctive place in
the the target
market’s mind. P 298
The BCG Competitive
Advantage Matrix
Number of Approaches
to Achieve Advantage
Few Many
Advantage
Large
Size of the
Volume Specialized
Conform-
Fea- Perfor-
Form Quality ance
tures mance
Quality
Ordering
Ordering Customer
Customer
Installation
Installation
Miscellaneous
Ease
Ease Consulting
Consulting
Services
Customer Maintenance
Customer Maintenance
Delivery
Delivery Training
Training &&Repair
Repair
Differentiation
• Personnel
• Channel
Image Differentiation
Media Atmosphere
Symbols
Events
Important
Important
Profitable
Profitable Distinctive
Distinctive
Differences Worth
Establishing
Affordable
Affordable Superior
Superior
Preemptive
Preemptive
Perceptual Map
Live shows 1.0
Easy to reach Little waiting
Good food 0.8
Fantasy Educational,
0.6 animals
Exercise Marineland
0.4
Fun rides Knott’s of the
Berry Japanese Pacific
0.2 Deer Park
Disneyland Farm
-1.6 -1.4 -1.2 -1.0 -0.8 -0.6 -0.4 -0.2 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6
-0.2
Magic Lion
Mountain -0.4 Country
Busch Safari
-0.6 Gardens
-0.8 Economical
Positioning Strategies
• Product Attributes
Promotion to
Channel Members
Wholesaler Wholesaler
Promotion Promotion
Business Customers
Push Push
Final Customers
Promotion to
Promotion to
Retailer
Promotion
Push
Business Final
Customer Consumer
Pull Pull
A Model of Buyer Behavior
Marketing Mixes All Other Stimuli
Person
Making
Decision
Problem-Solving Process
Personal
Needs
Social Needs
Safety Needs
Physiological Needs
5-6
The Consumer Problem Solving Process
Marketing mixes All other stimuli
Psychological Purchase
Social Influences Situation
Variables
Person making
decision
Need-want Awareness
Routinized Response
Information Search
Feedback of
information
Set Criteria as attitudes
Decide on Solution
Involvement Continuum
Brand identity
Brand
equity
Brand
relationship
spectrum
Unique characteristics of services
Key Factors That Influence Price Setting
Pricing
objectives
Price of other
Price flexibility
products in the line
Discounts and
Demand allowances
Price
settin
g
Cost Legal
environment
Geographic
Competition
pricing terms
Markup chain
in channels
17-
Strategic Pricing Options
Reverse
Cost-Plus
Variations POS
in Value
Customer
Emotion
Costs
Individual?
Bundled?
Pricing Objectives
Target
Return
Profit
Oriented Maximize
Profits
Dollar or Unit
Sales Growth
Pricing Sales
Objectives Oriented Growth in
Market Share
Meeting
Competition
Status Quo
Oriented Nonprice
Competition
Strategy Planning for Price
Target
Market
Pricing
objectives
Geographic
Discounts and
Price levels term —
Price allowances—
over product who pays
flexibility to whom and
life cycle transportation
when
and how
Distribution Options*
Direct Intermediary
Salesforce
•Internet •Franchise
•Telephone •Own •Wholesaler
•Mail •Another firm’s •Agent/Merchant
•Catalogue •Contract •Distributor
•Own channel •Partner
Truck
Rail
Modes
of
Transportation
Air
Pipeline
Water
Types of Retailers
Expanded
Specialty shops and
assortment department stores
and service
Expanded
assortment Supermarkets, discount
houses, mass-merchandisers,
Single- and/or reduced supercenters
Conven- and margins/service
tional limited-
offerings line
Added Telephone/mail order,
stores
convenience vending machines,
higher margins door-to-door, convenience
less assortment stores, electronic shopping
Expanded
assortment Internet
reduced margins
more information
Types of Wholesalers
Does wholesaler own
the products?
Yes (merchant wholesaler) No (agent middleman)
Limited-function
merchant
All the functions Wholesalers
Service
merchant
wholesalers
Four Examples of Basic Channels of
Distribution for Consumer Products
Manufacturer or producer
Wholesaler Wholesaler
Wholesaler
Consumer
l e rs C om p et e
H ow R et a i
5) Choosing a Location
Market Leader
•Distribution in place Market Challenger
•Price main weapon •Focus on flanks
•Premium price •Direct or indirect attack
•Variety of options
Market Niche
Market Follower •Stay with markets
•‘Cloning’ •Add niches
•Set lower prices •Premium price
•Selective distribution
Marketing Information Systems
Informatio Questions Decisio
n and n Result
Sources Answers Maker s
New Information
Marketing
Market
Models
Research Answers
Studies
?
Inputs Marketing
Internal Decision
Data Databases Support Manager Outcomes
Sources System Decisions
(DSS)
External
Data Information
Sources Technology
Specialists
Feedback
Product
Development
• Overestimation of Market Size
• Product Design Problems
• Product Incorrectly Positioned, Priced or Advertised
• Costs of Product Development
• Competitive Actions
PRODUCT DEVELOPMENT
New Product Development
Process
Getting
Defining Analyzing Inter- Solving
Problem-
the the preting the
Specific
Problem Situation Data Problem
Data
Inside Company
Secondary
Data
Sources
Outside Company
All
Data
Sources
Observation
Primary
Data
Sources
Questioning
1.
1. Develop
DevelopProduct
ProductIdeas
Ideasinto
into
Alternative
Alternative
Product
ProductConcepts
Concepts
2.
2. Concept
ConceptTesting
Testing--Test
Testthe
the
Product
ProductConcepts
Conceptswith
withGroups
Groups
of
ofTarget
TargetCustomers
Customers
3.
3. Choose
Choosethe
theBest
BestOne
One
Marketing Strategy Statement Formulation
Part
Part One
One -- Overall:
Overall:
Target
Target Market
Market
Planned
Planned Product
Product Positioning
Positioning
Sales
Sales &
& Profit
Profit Goals
Goals
Market
Market Share
Share
Part
Part Two
Two -- Short-Term:
Short-Term:
Product’s
Product’s Planned
Planned Price
Price
Distribution
Distribution
Marketing
Marketing Budget
Budget
Part
Part Three
Three -- Long-Term:
Long-Term:
Sales
Sales &
& Profit
Profit Goals
Goals
Marketing
Marketing Mix
Mix Strategy
Strategy
Business
Business Analysis
Analysis
Review
Review of
of Product
Product Sales,
Sales, Costs,
Costs,
and
and Profits
Profits Projections
Projections to
to See
See ifif
They
They Meet
Meet Company
Company Objectives
Objectives
IfIf No,
No, Eliminate
Eliminate
Product
Product Concept
Concept
IfIf Yes,
Yes, Move
Move to
to
Product
Product Development
Development
Standard
Standard Controlled
Test Controlled
Test Market
Market Test
Test Market
Market
Full
Fullmarketing
marketingcampaign
campaign AAfew
fewstores
storesthat
thathave
have
in
in a small numberof
a small number of agreed
agreedto
tocarry
carrynew
new
representative cities.
representative cities. products
productsfor
foraafee.
fee.
Simulated
Simulated
Test
Test Market
Market
Test
Testin
inaasimulated
simulated
shopping environment
shopping environment
to
toaasample
sampleofof
consumers.
consumers.
The Adoption Curve
Early Early Late Laggards/
Innovators
Adopters Majority Majority Nonadopters
(3-5%)
(10-15%) (34%) (34%) (5-16%)
90
Percent Adoption
50
20
5
0
Time
The Adoption Curve
• Innovators:
– First to Adopt, Eager to Try
– Young, Well-Educated, Mobile
– Seek Info from non-salesperson Sources
• Early Adopters
– Opinion Leaders
– Greater Contact with Salespeople
– Word-of-Mouth
The Adoption Curve
• Early Majority:
– Avoid Risk, Try Only if Others Have Usually
are Not Opinion Leaders
• Late Majority:
– Cautious About New Ideas, Older and More
Set in Their Ways
– More Subject to Peer Pressure
The Adoption Curve
• Laggards:
– Suspicious of New Ideas
– Do Things the Way that They Have Always
Been Done
The Product Life Cycle
Market Market Market Sales
Introduction Growth Maturity Decline
Total Industry
Sales
Total Industry
Profit
Tim
e
Defining “Product”
Target Market
Product
Brand Package Warranty
Idea
Physical
good/service Type of Brand:
Features Individual or Protection,
Quality level family Promotion, None, full, or
Accessories Manufacturer or or both limited
Installation dealer
Instructions
Product line
Strategy Planning for Advertising
Target Market
Advertising Publicity
Advertising Publicity
MARCOMS Strategic Process
PESTLE
PESTLE
AUDIT
Competitors
Competitors
SWOT
SWOT
Strategic
Strategic Intent/Objectives
STRATEGY Intent/Objectives
Segment/Target
Segment/Target
Position
Position
Proposition
Proposition Media
Media Classes
Classes
Creative
Creative Execution
Execution Media
Media Execution
Execution
Pre-Test
Pre-Test
Post-Test
Post-Test
OPERATIONS Contingency
Contingency
International
International
Brand Wheel
Features Preference, but
Benefits not loyalty
• Product Definition:
– Make the central benefit salient (again?)
• Performance Superiority:
– Solve a problem or better fulfill a desire
• Emotional:
– Help brand matter to the consumer
• Cultural Identification:
– Make the brand part of consumer’s world
• Paradigm Shift:
– Alter the consumer’s definition of
category
Types of MARCOMS Objectives
• A person, not a
“target”
• Beyond reports - talk
to customers
• Paint a personal
picture
• What’s really
important to them?
Sources of a Proposition
• product characteristics
• user characteristics
• ways of using the product
• how product is made
• surprising points about the product
• price characteristics
• image characteristics
• satisfying psychological/physiological needs
• product heritage
• disadvantages of non-use
• direct comparisons with rivals
• product comparisons
• newsworthiness
• generic benefits
What Proposition Will Do This?
ADVERTISING A paid for communication by an identified Mainly long-term TV, press, posters, radio, web, Awareness, attitudes
sponsor with the aim of informing and cinema, digital, SMS.
influencing one or more people.
DIRECT The recording, analysis and tracking of Short and long-term Direct mail, DRTV & radio, Mainly retention but also
MARKETING customers’ direct responses in order to telemarketing, press, inserts, acquisition
develop loyalty. leaflets, web, digital, SMS.
PR The formulation, execution and sustained Short and long-term Community relations/CSR, Credibility, visibility and
effort to establish and maintain corporate advertising, crisis reputation
goodwill and mutual understanding and management, events, internal
reciprocal goodwill between an communications, investor
organisation and its stakeholders. relations, media relations, public
affairs, lobbying, sponsorship,
web, digital.
SALES An incentive for the customer, sales force Mainly short-term Consumer: Coupons, contests, Consumer: Trial, re-trial,
PROMOTIONS or distributor to make an immediate trial, mail-in offers/refunds, group extended trial, build
purchase. promotions, self-liquidations, in- database
store promotions, point-of-sale, Trade: Gain a listing,
web, digital, SMS. increase distribution,
Trade: Dealer merchandise; increase inventory, improve
contests’ advertising, allowance, shelving space/position
trade allowance/ staff incentive,
web.
Media Scheduling
1. Reach
2. Creative Scope
3. Media History
4. Location
5. Distribution Channels
6. Budget
Budgeting
1. JUDGEMENTAL METHODS
• Arbitrary
• Affordable
2. OBJECTIVE and TASK
3. MEASUREMENT
• ROI
• Incremental
•Quantitative Models
4. PERCENTAGE OF SALES
• % Last Year’s Sales
• % Anticipated Sales
• Unit Sales
5. SHARE OF VOICE
• Competitive Absolute
• Competitive Relative
Marketing Audit
1. Set Standards
2. Evaluate
e.g. Marketing Standards
Objective is to 3. Take Action
Against
attain 25% Reality
market share
Adequate
Trouble Success
Strategy
Formulation
Failure Rescue
or Ruin
Poor
(Robert, 1991)
Process Model
Figure 13.3: A Process Model of Competitive
Advantage (Day and Wensley, 1988)
Outcomes
Reinvestment
Loop in the Model
• “Hard” – expressed in numbers that can easily be calculated,
compared and tracked
• However they are historical – a good way of tracking the past, but a
rather inadequate indication of the future
• They are not good diagnostics of strategic health
• By comparison measures of customer satisfaction and loyalty are
“soft,” and impression based but they are about the future
• The astute firm will reinvest the financial outcomes of competitive
advantage in the sources of competitive advantage itself, namely
superior skills and/or superior resources
• This activity closes the loop in the model, and suggests that
managing for competitive advantage is indeed a process that is
continually renewed, revived and refreshed
Customer Equity
• The outcomes of ROI and Market Share are hard but
historical
• The outcomes of Customer Satisfaction and Customer
Loyalty are future-oriented but soft
• The ideal marketing control variable would be a single
outcome that is both hard (a number that can be
expressed financially) and future (customer) oriented
• Customer Lifetime Value (CLTV), which in turn leads to
Customer Equity, is that single appropriate outcome
Customer Lifetime Value