Self-study marketing management
Chapter 17: Marketing Strategy s Planning
Marketing should act as a guiding business philosophy in order for it to be efficient and
effective. Managers should communicate marketing planning decisions throughout the
company and consider the impact of the environment to determine the best strategic
fit between the companies’ capabilities and resources and the market opportunities.
Marketing planning: the process by which businesses analyze the environment and their
capabilities, decide upon courses of marketing action and implement those
decisions.
17.1 Marketing Planning Context
Marketing planning is part of the broader concept of corporate strategic planning
(including finance, HR, distribution, trading, operations, etc.). The aim of this is to
provide direction so that a firm can direct its activities to meet high-level corporate
objectives. Marketing manages the interface between a firm and its environment.
Companies usually offer many products/services to many different target markets.
Decisions have to be made about the allocation of resources to each product/service.
Depends on attractiveness of the marketing for each product, and capabilities and
resources of the firm.
Firms sometimes exist of connected divisions or totally separate companies.
Strategic business unit (SBU): a business or company division serving a distinct group of
customers and with a distinct set of competitors, usually strategically autonomous.
Marketing planning provides a range of insights from the trading environment to
identify target markets and customer needs. 2 aspects of marketing planning: core
functions and key planning process:
17.2 The Functions of Marketing Planning
Core function is to answer 4 questions:
1. Where are we now? current position looking at past performance. Effectiveness
of previous marketing plans. SWOT
2. Where would we like to be? Defined by its marketing objectives
3. How do we get there? Look at key target audience and devise a marketing mix
strategy to achieve marketing objectives
4. Are we on course? Look at performance measures, e.g., sales and profitability
, 17.3 The Process of Marketing Planning
Main marketing planning process divided in 2 distinct areas:
1. The business unit level
2. The product level
17.3.1 Business mission: how to define a business
Business mission: the organizations’ purpose, usually setting out its competitive
domain, which distinguishes the business from others of its type.
Mission statement defines the business, guides the setting of objectives and how
these will be achieved, is the foundation on which to build.
Vision statement looks to the future, is more aspirational and should provide an
overall direction for a firm that can inspire confidence and optimism
Mission statements reflect customer groups being served, refers to their needs being
satisfied, and describe the process by which a customer need can be satisfied.
4 key influences of shaping a business mission:
1. Mission should be market-focused not on a good-producing process.
2. Importance of the product or service offering, defines and differentiates a firm
3. A business should focus the mission statement around the customer
4. Location of the firm’s target markets can define the products/services it offers,
and the distribution channels it uses.
,A mission statement should:
- Provide a solid understanding of the business and the forces acting on its
operations
- Encapsulate the personal conviction and motivation of the leader
- Create strategic intent of winning throughout the organization
- Enable success
17.4 Marketing Audit
Marketing audit: a systematic examination of a business’s marketing environment,
objectives, strategies, and activities with a view to identifying key strategic issues,
problem areas and opportunities.
Basis for developing and monitoring a plan of action to improve marketing
performance
Benefits from a clear mission statement since it defines the boundaries of the
environmental scan and helps decisions regarding which issues/opportunities
are important
Internal audit focuses on areas under
control of marketing management,
external audit concerned with forces
over which they have no control. A
checklist of issues is useful and
common. But recognize a firm’s
operating context for the audit to
deliver performance improvements.
17.4.1 External and internal factors
External
The external microenvironment climate can affect marketing audit, and business and
marketing performance. Environmental dynamism (Covid-19, Brexit) can have a large
impact on market planning. They are major events that have brought about a climate of
instability and change. It is important to identify emerging trends that have implications
for exploitable opportunities and the extent of turbulence in the market. External
factors are political, economic, social, technological, ecological, and legal (PESTEL).
Scanning in a systematic manner is crucially important for all organizations as changes can
have dramatic effect on success.
Internal
Internal microenvironment factors include the actors in the firm’s environment, such as
customers, distributors, suppliers, and competitors. Analysis consists of:
- Customer analysis: buyer behavior, how they rate offerings, how they segment
, - Competitor analysis: their objectives and strategies, their strengths/weaknesses,
entry barriers
- Distribution analysis: attractiveness of different distributors
- Supplier analysis: who and where they are, strengths/weaknesses
Strategic issues analysis: examines the suitability of marketing objectives and
segmentation bases in the light of changes in the marketplace.
Marketing structure should be analyzed. Consists of marketing organization, training, and
intra- and interdepartmental communication.
Marketing performance
Third key area of interest when conducting a marketing audit is marketing performance. Considerations
are financial (market share) and non-financial (customer satisfaction).
Marketing audit provides a basis for reviewing a firm’s past performance against its future
potential. Do not give the same amount of attention to every item on the checklist.
Audit is critical in deciding key focus items. It is an ongoing activity. Some firms conduct
audits yearly, in less turbulent environments every two or three years.
17.4.2 SWOT analysis
SWOT analysis: a structured approach to evaluating the strategic position of a business by
identifying its strengths, weaknesses, opportunities and threats.
When evaluating strengths and weaknesses (internal) only resources and capabilities that
are valued by the customer should be included.
Opportunities and threats should be listed as anticipated events or trends outside the
business that have implications for performance.
Conversion strategies: Once SWOT is done, how can weakness be turned into strengths and
threats into opportunities?
Matching strategies: Match strengths with opportunities
To gain value out of a SWOT, firms should take a fresh look and use additional lenses to
determine the outcomes of their analysis by finding ways to:
- Create a fit between strengths and opportunities to leverage advantages
- Reduce vulnerability by improving weaknesses and ensuring current awareness
of threats.
Chapter 17: Marketing Strategy s Planning
Marketing should act as a guiding business philosophy in order for it to be efficient and
effective. Managers should communicate marketing planning decisions throughout the
company and consider the impact of the environment to determine the best strategic
fit between the companies’ capabilities and resources and the market opportunities.
Marketing planning: the process by which businesses analyze the environment and their
capabilities, decide upon courses of marketing action and implement those
decisions.
17.1 Marketing Planning Context
Marketing planning is part of the broader concept of corporate strategic planning
(including finance, HR, distribution, trading, operations, etc.). The aim of this is to
provide direction so that a firm can direct its activities to meet high-level corporate
objectives. Marketing manages the interface between a firm and its environment.
Companies usually offer many products/services to many different target markets.
Decisions have to be made about the allocation of resources to each product/service.
Depends on attractiveness of the marketing for each product, and capabilities and
resources of the firm.
Firms sometimes exist of connected divisions or totally separate companies.
Strategic business unit (SBU): a business or company division serving a distinct group of
customers and with a distinct set of competitors, usually strategically autonomous.
Marketing planning provides a range of insights from the trading environment to
identify target markets and customer needs. 2 aspects of marketing planning: core
functions and key planning process:
17.2 The Functions of Marketing Planning
Core function is to answer 4 questions:
1. Where are we now? current position looking at past performance. Effectiveness
of previous marketing plans. SWOT
2. Where would we like to be? Defined by its marketing objectives
3. How do we get there? Look at key target audience and devise a marketing mix
strategy to achieve marketing objectives
4. Are we on course? Look at performance measures, e.g., sales and profitability
, 17.3 The Process of Marketing Planning
Main marketing planning process divided in 2 distinct areas:
1. The business unit level
2. The product level
17.3.1 Business mission: how to define a business
Business mission: the organizations’ purpose, usually setting out its competitive
domain, which distinguishes the business from others of its type.
Mission statement defines the business, guides the setting of objectives and how
these will be achieved, is the foundation on which to build.
Vision statement looks to the future, is more aspirational and should provide an
overall direction for a firm that can inspire confidence and optimism
Mission statements reflect customer groups being served, refers to their needs being
satisfied, and describe the process by which a customer need can be satisfied.
4 key influences of shaping a business mission:
1. Mission should be market-focused not on a good-producing process.
2. Importance of the product or service offering, defines and differentiates a firm
3. A business should focus the mission statement around the customer
4. Location of the firm’s target markets can define the products/services it offers,
and the distribution channels it uses.
,A mission statement should:
- Provide a solid understanding of the business and the forces acting on its
operations
- Encapsulate the personal conviction and motivation of the leader
- Create strategic intent of winning throughout the organization
- Enable success
17.4 Marketing Audit
Marketing audit: a systematic examination of a business’s marketing environment,
objectives, strategies, and activities with a view to identifying key strategic issues,
problem areas and opportunities.
Basis for developing and monitoring a plan of action to improve marketing
performance
Benefits from a clear mission statement since it defines the boundaries of the
environmental scan and helps decisions regarding which issues/opportunities
are important
Internal audit focuses on areas under
control of marketing management,
external audit concerned with forces
over which they have no control. A
checklist of issues is useful and
common. But recognize a firm’s
operating context for the audit to
deliver performance improvements.
17.4.1 External and internal factors
External
The external microenvironment climate can affect marketing audit, and business and
marketing performance. Environmental dynamism (Covid-19, Brexit) can have a large
impact on market planning. They are major events that have brought about a climate of
instability and change. It is important to identify emerging trends that have implications
for exploitable opportunities and the extent of turbulence in the market. External
factors are political, economic, social, technological, ecological, and legal (PESTEL).
Scanning in a systematic manner is crucially important for all organizations as changes can
have dramatic effect on success.
Internal
Internal microenvironment factors include the actors in the firm’s environment, such as
customers, distributors, suppliers, and competitors. Analysis consists of:
- Customer analysis: buyer behavior, how they rate offerings, how they segment
, - Competitor analysis: their objectives and strategies, their strengths/weaknesses,
entry barriers
- Distribution analysis: attractiveness of different distributors
- Supplier analysis: who and where they are, strengths/weaknesses
Strategic issues analysis: examines the suitability of marketing objectives and
segmentation bases in the light of changes in the marketplace.
Marketing structure should be analyzed. Consists of marketing organization, training, and
intra- and interdepartmental communication.
Marketing performance
Third key area of interest when conducting a marketing audit is marketing performance. Considerations
are financial (market share) and non-financial (customer satisfaction).
Marketing audit provides a basis for reviewing a firm’s past performance against its future
potential. Do not give the same amount of attention to every item on the checklist.
Audit is critical in deciding key focus items. It is an ongoing activity. Some firms conduct
audits yearly, in less turbulent environments every two or three years.
17.4.2 SWOT analysis
SWOT analysis: a structured approach to evaluating the strategic position of a business by
identifying its strengths, weaknesses, opportunities and threats.
When evaluating strengths and weaknesses (internal) only resources and capabilities that
are valued by the customer should be included.
Opportunities and threats should be listed as anticipated events or trends outside the
business that have implications for performance.
Conversion strategies: Once SWOT is done, how can weakness be turned into strengths and
threats into opportunities?
Matching strategies: Match strengths with opportunities
To gain value out of a SWOT, firms should take a fresh look and use additional lenses to
determine the outcomes of their analysis by finding ways to:
- Create a fit between strengths and opportunities to leverage advantages
- Reduce vulnerability by improving weaknesses and ensuring current awareness
of threats.
