A Framework for

Marketing Management

Chapter 2
Developing and Implementing Marketing
Strategies and Plans

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Chapter Questions

 How does marketing affect customer

value?
 How is strategic planning carried out at
different levels of the organization?
 What does a marketing plan include?
 How can management assess
marketing performance?

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Two Views of the Value Delivery
Process
 Traditional Physical  Value Creation and
Process Sequence Delivery Sequence
 Make the product  Choose the value
 Sell the product  Provide the value
 Communicate the value

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Other Views
 Kumar’s “3Vs”  Webster—Marketing is:
 Define the value segment  Value-defining process
or customers (and their like market research
needs)  Value-developing
 Define the value processes including new-
proposition product development,
 Define the value network sourcing strategy, and
to deliver promised vendor selection
service  Value-delivering
processes such as
advertising and
managing distribution

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The Value Chain

Primary Activities Support Activities

 Inbound logistics  Firm infrastructure

 Operations  Human resource

 Outbound logistics management

 Marketing and sales  Technology

 Service development
 Procurement

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Core Business Processes

 The market sensing process

 The new offering realization process
 The customer acquisition process
 The customer relationship management
process
 The fulfillment management process

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Characteristics of Core
Competencies
 A source of competitive advantage
 Applications in a wide variety of markets
 Difficult for competitors to imitate

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Holistic Marketing Orientation and
Customer Value
 Value exploration: How can a company
identify new value opportunities?
 Value creation: How can a company
efficiently create more promising new value
offerings?
 Value delivery: How can a company use its
capabilities and infrastructure to deliver the
new value offerings more efficiently?

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A Holistic Marketing Framework
 Value exploration  Customer focus
 Value creation  Core competencies
 Value delivery  Collaborative network

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Role of Strategic Planning

 Managing a company’s businesses as an

investment portfolio
 Assessing each business’s strength
 Establishing a strategy to achieve its long-run
objectives

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Organizational Levels

 Corporate level
 Divisional level
 Business unit level
 Product level

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Marketing Plan

 Central instrument for directing and

coordinating the marketing effort
 Two levels:
 Strategic marketing plan—lays out the firm’s
target markets and value propositions, based on
the best market opportunities.
 Tactical marketing plan—specifies the
marketing tactics, including product features,
promotion, pricing, and service.

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Corporate Planning Activities

 Defining the corporate mission

 Establishing strategic business units
 Assigning resources to each unit
 Assessing growth opportunities

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Defining the Corporate Mission

 What is our business?

 Who is the customer?
 What is the value to the customer?
 What will our business be?
 What should our business be?

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Good Mission Statements

 Focus on limited number of goals

 Stress major policies and values
 Define major competitive spheres

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Major Competitive Spheres
 Industry  Market segment
 Products and  Vertical
applications  Geographical
 Competence

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Dimensions That Define a Business

 Customer groups
 Customer needs
 Technology

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Characteristics of an SBU

 Single business or collection of related

businesses
 Own set of competitors
 Manager responsible for strategic planning
and profit performance

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Growth Opportunities

 Intensive growth
 Integrative growth
 Diversification growth

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Organizations

 Structure
 Policies
 Culture

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The Business Unit Strategic Planning
Process
 Business mission
 SWOT analysis
 Goal formulation
 Strategy formulation
 Program formulation
 Implementation
 Feedback and control

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SWOT Analysis

 Strengths
 Weaknesses
 Opportunities
 Threats

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Marketing Opportunity

 An area of buyer need and interest that a

company has a high probability of profitably
satisfying.
 Sources:
 Supply something that is in short supply
 Supply an existing product or service in a new or
superior way
 Totally new offering

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Environmental Threat

 Challenge posed by an unfavorable trend or

development that would lead, in the absence
of defensive marketing action, to lower sales
or profit.

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Effective Goal Formulation

 Arranged hierarchically from most to least

important
 Stated quantitatively
 Realistic
 Consistent

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Porter’s Generic Strategies

 Overall cost leadership

 Differentiation
 Focus

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McKinsey’s Seven “S” Elements

“Hardware” “Software”
 Strategy  Style

 Structure  Skills

 Systems  Staff

 Shared values

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Marketing Plan Contents

 Executive summary
 Table of contents
 Situation analysis
 Marketing strategy
 Financial projections
 Implementation controls

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Marketing Metrics and Marketing
Dashboards
 Marketing metrics is
the set of measures
that helps marketers
quantify, compare, and
interpret marketing
performance.
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 Marketing dashboard
is a visual display of
real-time indicators that
summarize a set of
relevant internal and
external measures to
ensure proper
functioning.
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Measuring Marketing Plan Performance

 Sales analysis
 Market share analysis
 Marketing expense-to-sales ratio
 Financial analysis

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