Marketing:

An Introduction
Armstrong, Kotler, Trifts,
Buchwitz, Gaudet

Updated 6th Canadian Edition

with Integrated B2B Case

2-1 Copyright © 2018 Pearson Canada Inc. 1

Part 1:
Defining Marketing and the Marketing Process

CHAPTER 2
Company and
Marketing Strategy:
Partnering to Build
Customer Relationships

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Learning Objectives
Explain company-wide strategic planning and its four steps.
1
Discuss how to design business portfolios and develop growth
strategies.
2
Explain marketing’s role in strategic planning and how marketing
works with its partners to create and deliver customer value.
3
Describe the elements of a customer-driven marketing strategy
and mix, and the forces that influence it.

4
List the marketing management functions, including the elements
of a marketing plan, and discuss the importance of measuring and
managing return on marketing investment.
5

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Steps in Strategic Planning

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ti
• Strategic Planning Defined:

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 Objective-based process of

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developing and maintaining a

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strategic fit between the
organization’s goals and

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capabilities and its changing

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marketing opportunities

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Steps in Strategic Planning

• Corporate Level:
 Defining the company mission
 Setting company objectives and goals
 Designing the business portfolio

• Business Unit, Product, and Market Level:

 Planning marketing strategy as well as other functional
strategies

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Steps in Strategic Planning

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Steps in Strategic Planning

• Mission statement: Statement of the organization’s
purpose – the value it offers, and for whom.

Example: Nike’s mission is “to bring inspiration and

innovation to every athlete* in the world. (*If you
have a body, you are an athlete.)”

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Steps in Strategic Planning

• Translate mission into supporting objectives
• Examples:
 Business objective: Increase profits
 Marketing objective: Increase market share of
domestic and international markets

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Business Portfolios & Growth Strategies

• Assess the business portfolio:
 Evaluate the firm’s current businesses and products,
and decide which should receive more, less, or no
investment

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Business Portfolios & Growth Strategies

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Check Your Understanding

Assessing Apple
Suppose you are looking at
Apple’s line up of products and
need to place four of its major
products into separate quadrants
of BCG’s matrix.
In which category would you
place:

• Tablets
• Smartphones
• Laptops
• Desktops

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Business Portfolios & Growth Strategies

• Challenges in Portfolio Analysis:

 Time consuming, costly to implement
 Measuring market share and growth rate
 Future planning de-emphasized

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Business Portfolios & Growth Strategies

CAN YOU HANDLE THE TRUTH?

• Companies must develop strategies for growing and

downsizing portfolios
• Downsizing eliminates products or business units that
are not profitable or no longer fit the company’s overall
strategy
 Many reasons exist for downsizing

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Business Portfolios & Growth Strategies

• Product/market grid identifies growth alternatives

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Business Portfolios & Growth Strategies

Product Market use example:
Tim Hortons® concludes it must grow in order to keep up with social
preferences and competitive forces. Using the PM grid method, it could
do any of the following:
• Market penetration: make the same products for the same market
in an attempt to increase market share
• Product development: create a reduced calorie donut targeted at
its current market
• Market development: attempt to reach dinner market with current
products
• Diversification: create a gluten-free product for the gluten-
intolerant market

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Planning Marketing: Partnering

to Build Customer Relationships
• Provides a guiding philosophy
 The marketing concept
• Provides input to strategic planners
 Identifies opportunities
• Suggests strategies to reach objectives

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Role of Marketing in Planning

• Partner Relationship Management:

 Working with internal partners can create an
effective value chain
 Working with external partners helps to form a
superior value delivery network

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Role of Marketing in Planning

• Value delivery network includes:

 Company’s value chain
 Suppliers
 Distributors
 Customers
• The goal is improved performance in delivering value to
customers

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Strategy
and the Marketing Mix
• Objective: build profitable customer relationships through
value creation
• Strategies include:
 Market segmentation and targeting
 Differentiation and positioning
• Marketing strategy guides marketing mix decisions

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing
Strategy
and the
Marketing Mix

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Strategy
and the Marketing Mix
• Segmentation:
 Dividing a market into
segments of buyers
✗
according to needs
• Targeting:
✗
 Evaluating each
segment and selecting
✔
which to pursue
✗
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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Strategy and the Marketing Mix

• Positioning:
 Attempting to occupy a
desirable place in the
minds of target consumers
• Differentiation:
 Creating unique and
superior customer value

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Strategy and the Marketing Mix

• Marketing Mix:
 Product
 Price
 Place
 Promotion

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Strategy and the Marketing Mix

Seller View – Four Ps Buyer View – Four Cs

Product Customer Solution
Price Customer Cost
Place Convenience
Promotion Communication

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Managing Marketing

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Management: Function 1

• SWOT Analysis:

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Management: Function 2

Marketing Plan
• Executive Summary
• Current Marketing Situation
 SWOT
• Objectives and Issues
• Marketing Strategy
• Action Programs
• Budgets
• Controls

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Management: Function 3

• Implementation:
Plans converted to
actions by assigning:
 Who
 Where
 When
 How

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Department Organization

Chief Marketing Officer/

VP Marketing

• Functional organization
• Geographic organization
• Product management
• Market or customer
• Combination

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Management: Function 4

• Marketing control involves four steps:
1. Set specific marketing goals
2. Measure performance in the marketplace
3. Evaluate performance
4. Take corrective action to close the gaps between
goals and performance

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Marketing Management: Function 4

• Operating Control:
 Evaluates performance against the annual plan and
takes corrective action
• Strategic Control:
 Evaluates whether strategies match opportunities

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Check Your Understanding

SWOT Breakdown
The elements of SWOT are easy to remember but difficult to apply. “S” and
“O” are good. “W” and “T” are bad. The differences between the two positive
forces and the two negative forces lies in where they originate. Strengths
and weaknesses come from within and are totally controlled by the firm.
Opportunities and threats come from outside and are uncontrollable by the
firm. Assign an S, W, O, or T to the statements on the right.

1. A slow economy will decrease consumer demand. ____

2. The firm has a high customer satisfaction rating. _____
3. The firm will postpone expansion due to shortage of capital. _____
4. There is a growing demand for the firm’s type of goods. _____

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Chapter 2: Company and Marketing Strategy: Partnering to Build
Customer Relationships

Reviewing the Concepts

• Explain the four steps of company-wide strategic planning.
• Discuss how to design business portfolios and growth
strategies.
• Explain marketing’s role in strategic planning and how
marketing creates and delivers customer value.
• Describe the elements of a customer-driven marketing strategy
and mix, and the forces that influence it.
• List the marketing management functions and discuss the
importance of measuring and managing return on marketing
investment.

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