BUSI

2204A (Fall 2018)

Basic Marketing
Nada Elnahla, PhD
 Chapter 3

Strategic Planning for

Competitive Advantage

Copyright © 2019 by Nelson Education Ltd. 2

 Learning Outcomes
1. Explain the importance of
strategic planning
2. Develop an appropriate
business mission
statement
3. Describe how to conduct
business portfolio analysis

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 Learning Outcomes
4. Summarize how business
planning is used for
competitive advantage
5. Discuss marketing
planning and identification
of target markets
6. Describe the elements of
the marketing mix

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 Learning Outcomes
7. Explain why
implementation,
evaluation, and control of
the marketing plan are
necessary
8. Identify several techniques
that help make strategic
planning effective

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 Strategic Planning

Organization’s
objectives and
resources

Leadership Strategic
and Planning
managerial Evolving
process market
opportunities

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 Strategic Planning—3 Levels

• Sets the direction and scope—mission

Corporate statement, business opportunities, and
resource allocation
• Takes place at the SBU level
Business • Goal is to gain a competitive
advantage

• Target market and

Marketing marketing mix activities

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 Corporate Corporate
Planning

Business SBU SBU

Individual Individual Individual

Individual
businesses that businesses businesses
Marketing that are businesses that
that are
are related are related
related related

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Why would you start a
business?

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In order to start a successful
business, what should your
starting point be?

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 Decisions
Strategic Tactical
• Made at all three levels • Made at the operational or
marketing level
• Wider in scope
• Narrow in scope
• Longer in orientation
• Short term
• Affect long-run course, allocation
of resources, and financial • Limited impact of long-run
success profitability
• Directed from strategic
decisions made at the corporate
level
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 Strategic Marketing—
How?

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 Corporate Planning
• Defining the Business Mission
– Foundation
– What value do we provide for customers?
– Establishes boundaries for all decisions

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 Business Mission

Goods and
Markets
services Focus to serve
offered

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 Designing the Business Portfolio
• Starts with an understanding of the current environment
and potential environment
• How?
• Conduct a SWOT

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 SWOT
SWOT Analysis

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 Strategic Alternatives
• The SWOT analysis will result in themes that can take the form
of alternative growth strategies

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 Growth Strategies
Ansoff’s Strategic Opportunity Mix

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BCG Portfolio Matrix

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 BCG Portfolio Matrix

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Business
Planning

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 Business Planning for Competitive Advantage
• How to go about implementing and executing the strategy
– More detailed planning at the SBU level
– The goal is to achieve a competitive advantage that is sustainable
– Complete a SWOT at the SBU level

LO 4 Copyright © 2019 by Nelson Education Ltd. 36

 Competitive Advantage
• The set of unique features of a company and its
products that are perceived by the target market as
significant and superior to the competition
– cost
– product/service differentiation
– niche strategies

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 Cost Competitive Advantage

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 Product/Service Differentiation Competitive
Advantage
• Apple—competitive
differentiation built around
innovation

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Copyright © 2019 by Nelson Education Ltd. 40
 Niche Competitive Advantage
• Serving the needs of a segment that has good growth potential
but is not crucial to the success of the major competitors
– geographic niche
– product niche

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 Building a Sustainable Competitive Advantage
• An advantage that
– cannot be copied
– can be sustained

• Sources of tomorrow’s competitive advantages:

– skills and assets of the organization
– marketing leaders need to continually focus on these skills and
assets to create and sustain the competitive advantage

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 Marketing
Planning

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 Setting Marketing Objectives

A statement of Realistic
what is to be
accomplished

Time
Measurable
specific

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 Target Market Strategy
• Begins with an MOA
– Estimation of size and sales Entire
market
potential of segments that are
of interest
Single Multiple
• Then a decision regarding segment segments
which/how many segments to
target Target
market(s)

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 What are your sources of
information?
(1) Market à research projects
(2) Environmental scanning
process

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 Who is the client?

Definition should be:

inclusive + operational +
focused

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 The Marketing Mix (4Ps)

Product Place

Promotion Price

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 Product Strategies
• Heart of the marketing mix
– The product offering and product strategy
– Physical product or a service
• Physical unit
• Package
• Warranty
• After sale service
• Brand name
• Image
• Value
• And …

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 Pricing Strategies
• What a buyer must give up in the exchange
– “Value” in the mind of the consumer
– Quickest element to change
– Can be an important competitive weapon

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 Place Strategies
• Making the products available when and where the customer
wants them
– Physical distribution
• Storing
• Transporting

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 Promotion Strategies
• Introduce, facilitate, or sustain conversation and community
between company and customer
– Integrated marketing communications
• Advertising
• Direct marketing
• Public relations
• Sales promotion
• Personal selling
• Digital marketing
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 Implementation,
Evaluation, and
Control

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 Implementation
• The process that turns the plan into action—“doing what you
said you were going to do”
• Can be a source of failure

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 Evaluation and Control

Evaluation— Control—informal
gauging Marketing and formal control
achievement of Audit will create
objectives efficiency

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 Effective Strategic Planning

Continual
attention

Management
Creativity
commitment

Effective
Strategic
Planning

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 An Example of Strategic Planning

• The Nederlander Organization

http://nelson.cengage.com/marketing/shared/vi
deo_wrappers/video_quiz/strategic_plan_nederl
anderorg.html

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 Class Discussion
• Choose a company and conduct a SWOT analysis.

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 Review
§ Which of the following answers the question, "What business
are we in, and where are we going?"
a) A mission statement
b) A strategic plan
c) A situation analysis
d) A market strategy

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 Review
§ What should an organization's mission statement primarily
focus on?
a) The products it wishes to sell
b) The market it wishes to serve
c) Its social responsibilities
d) The target market

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 Review
§ Ski Banff began with the distribution of all-natural soda at an
Alberta ski slope. When it expanded distribution to include all
of western Canada, which strategic alternative did it use?
a) Market growth
b) Market penetration
c) Product penetration
d) Market development

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 Review
§ Orchard operators across Canada have turned to the
production of specialty skin-care products as a means of
increasing sales. These new small cosmetics companies are
using _________ to increase their sales.
a) Diversification
b) Market penetration
c) Product penetration
d) Market development

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 Review
§ Everyone knows the brand name Godiva Chocolate. Godiva is
what many consumers think of when they think of chocolate.
Which type of advantage is this widely recognized brand
name a source of?
a) A product differentiation competitive advantage
b) A competitive advantage
c) A niche competitive advantage
d) A market augmentation advantage

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