Topic 2: Marketing Strategy and Planning ( Corporate and division…
Topic 2: Marketing Strategy and Planning
Product planning: the nature and contents of a marketing plan
Selecting the target market involves segmenting the market, evaluating the segments for their suitability, and selecting one or more target segments. This is a crucial step, because the remainder of the marketing program hinges on the relevance of the chosen segments.
Designing marketing strategies means deciding how to enter and grow in the market given the nature of the market offering and the target segments.
Analysing marketing opportunities means looking for unmet needs in sizeable and growing markets. A marketer needs to find sources of information that will help to identify these prospective markets.
An important aspect of marketing strategy is how the product offering is positioned for competitive advantage. We try to create a product or service that is as close to what the customer requires as is economical for us to do, and that provides advantages over the offerings of competitors.
Marketing strategy and planning tends to relate closely to the value delivery process illustrated in the textbook (Kotler et al. 2013, p. 40). Marketing strategy is largely about target marketing – segmenting the market and positioning an offering to specific segments. Marketing planning is more about deciding the marketing mix that is right for the target segments, preparing budgets and scheduling the timing of intended actions.
This is because every different product (or product line) within the company needs its own marketing plan. The nature and contents of a marketing plan are summarised in five broad steps:
Executive summary and table of contents
Business unit (BU) strategic planning
BU goals and objectives are concerned with sales and profit targets, marketing strategies for new products and markets, capital expansion and so on.
Because markets are diverse, there is a need to come up with individual strategies for each individual market.
The BU mission is a purposeful statement because it refers directly to products/services and markets. The BU mission is concerned with issues such as: what business we are in, who our customers are, and our core competencies.
Corporate and division strategic planning
Strategic planning at corporate headquarters usually involves the following steps:
Define the corporate mission.
Establish strategic business units (SBUs) within the corporation that have their own
market and strategic requirements and managers.
Assign resources to SBUs.
Assess growth opportunities for new businesses (i.e. SBUs), and reinvigorate, harvest
or divest under-performing businesses.
The strategic way to define a business is to look at what the customer is actually buying as mentioned in topic 1.
Why is this important? Because it allows a company to see expansion and diversification opportunities that are uniquely related to their own business and the expertise they have gathered so far.
The mission gives us a picture of where we want to go for the future. A good mission statement provides guidance by putting boundaries on a company’s endeavours that restrict products and markets to those the company can do well.
Assigning resources to SBUs means determining those that need resources as distinct from those that can provide the resources.
Assessing growth opportunities generally implies that every business needs from time to time to review its growth opportunities and based on the observed trends decide which strategy to follow – whether to expand, downsize or terminate the business.