EURO FH - Marketing MKTG1

Why prepare a Marketing Plan?

intensify of competition in many markets, due to growth of global competition, as barriers to trade have been lowered and global communication improved role of the multinational conglomerate has expanded; this now disregards geographical and other boundaries and seeks Profit opportunities on a global scale prevailing legislation and political ideologies have served to foster entrepreneurial and "free market" values continual technological Innovation, giving rise to new sorces of competition for established products and markets successful Marketing in a competitive economy is about competitive success and positioning key to achieving organizational goals lies in determining the needs and wants of the target markets and delivering satisfaction in a more effective and efficient way than competitors   Marketing planning: structured process of researching and analysing Marketing situations, developing and documenting Marketing objectives, strategies and programmes, and implementing, evaluating and Controlling activities to achieve the obejctives; adaptable, ongoing process outcome: Marketing plan; a document, that summarizes what the marketer has learned about the marketplace and indicates how the firm plans to reach its Marketing objectives

Why prepare a Marketing Plan?

benefits of Marketing planning consistency: Marketing plan will be consistent with the Overall corporate plan and with orther departmental or funtional plans; it should also be consistent with the plans of previous years, minimizing the risk of Management planning prevents the short sighted tendency to place all effort on the "here and now" responsibility: those who are responsible for implementing the individual parts of the Marketing plan will know what their responsibilities are and can have their Performance monitored agaist These plans; enables a control System to be designed and established whereby Performance can be assessed against predetermined criteria communication: those implementing the plans will also know what the Overall objectives are, the assumptions that lie behind them, and the context for each of the detailed activities commitment: assuming that the plan is agreed upon by those involved in its implementation as well as by those who will provide the ressources, it should stimulate a Group commitment to its implementation and ultimately lead to better decision-making

Main stages in developing a Marketing Plan

Step 1: Mission, corporate Goals and objectives define the Business in Terms of the benefits the Company provides to it's customers, rather than in Terms of what it produces   Step 2: Assessing the current internal and external situation the foundation for competitiveness is the firms internal ressources; These should be matched against the external opportunities

Step 3: SWOT analysis identification of strenghts/weaknesses and opportunities/threats with the objective of identifying key issues that drive performance   Step 4: Segmentation, targeting and positioning dividing the market into different segments is the Basis for targeting and positioning

Main stages in developing a Marketing Plan

Step 5: Strategic market plan using a Portfolio Analysis of market attractiveness and positioning   Step 6: Tactical Marketing plan on the Basis of a strategic market plan, an appropriate Marketing mix is developed to accomplish the Performance objectives

Step 7: Marketing budget Marketing Budget for the tactical Marketing strategy must entail appropriate ressources allocation to meet the Performance objectives of the strategic market plan   Step 8: Implementation and Performance evaluation are the strategic market plan and the tactical Marketing strategy producing the required Performance with respect to market share, revenues and profitability? yes: prepare for next year's Marketing plan no: the Performance gap is sufficiently outsized so that a reexamination of the Marketing plan is required

Assessing the Internal Marketing Situation

Environmental Scanning matching of internal strenghts and weaknesses with external opportunities and threats most often studied macro-environmental forces social demographic economic technological political legal competitive leads to two important views: Market Orientation View (MOV) & Resource Based View (RBV)

Market Orientated View (MOV)

term market (or Marketing) orientation refers to the implementation of the Marketing concept Definition "market orientation" by Kohli & Jaworski (1990): "A market orientation entails (1) one or more departments engaging in activities geared toward developing an understanding of customers’ current and future needs and the factors affecting them, (2) sharing of this understanding across departments, and (3) the various departments engaging in activities designed to meet select customer needs. In other words, a market orientation refers to the organization-wide generation, dissemination and responsiveness to market intelligence." key: achieving understanding of the market & the customer market orientation refers to the way a firm implements the Marketing concept three-component view of market orientation: Generation of, Dissemination of and responsiveness to market intelligence no exclusive responsibility of a Marketing department but a company-wide mode of operation

Ressource Based View (RBV)

Roots Of Competition Hollensen And Opresnik (binary/octet-stream)

RBV Marketing essentially seeks a long term fit between the requirements of the market and the abilities to compete in it market requirements evolve over time and the resource profile of the organization must be continously developed to enable it to continue to compete and to enable it to take Advantages of new opportunities many important ressources and capabilites are created through company history

Types of Ressources

Technical Ressources key ressource in many organizations becomes increasingly important in a world of rapidly chanigng technology ability of the organization to develop new proccesses and products thorugh Research and development, which can be utilized in the marketplace   Managerial Skills experience of Managers and the way in which they discharge their duties and motivate their staff have a Major Impact on corporate performance   Organization very structure of a organization

Financial Ressources dicates ist scope for Action and ability to put ist strategies into operation in deciding Marketing strategy a Major consideration is often what financial ressources can or cannot be put into the programme   Information Systems companies with the Systems in place to cope with the massive increases in data that such newer collection procedures are creating will be in a stronger Position to take Advantage of the opportunities afforded

Types of Ressources

Tangible Ressources    financial or physical value as measured by the firm's Balance sheet

Intangible Ressources non-physical factors (or non-financial) in nature and are rarely included in the firm's Balance sheet    Assets something that the firm "has" Copyrights, patents, registered designs, Trademarks, ...    Skills (or capabilities) something that the firm "does"

Capabilities

Strategic Capabilities dominant logic, orientation guiding Management, ability of the organization to learn, ability of Senior Managers to manage the implementation of strategy Functional Capabilities execution of functional Tasks: Marketing, financial Management and operations Management capabilites Operational Capabilites undertaking individual line Tasks: operating machinery, application of Information Systems, completion of order processing

Individual Competencies skills and abilities of individuals within the organization: ability of the individual to Analyse critically and assess a given situation Group Competencies individual abilities come together in Teams or ad hoc, informal, task-related teams Corporate-Level Competencies relate to the abilities of the firm as a whole to undertake strategic, functional and operational Tasks: ability of the firm to internalize learning

Core Competencies

Core Competencies Tests (binary/octet-stream)

RBV can also be linked to core competencies different approaches to a similar issue - understanding what a Company is capable of achieving by exploiting ist capabilities in the marketplace

Market-Driven vs. Market-Driving

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Market-Driven vs. Market-Driving

Market Driven Vs Market Driving Strategy (binary/octet-stream)

market-driven behaviour relies heavily on exploitative learning, which occurs within existing market boundaries and is hence primarily regarded to be a reactive rather than a proactive stance proactive market orientation is essentially an Extension of market-driven activity customer leading makes use of untaopped market space uncovered by exploratory leanings firms utilizing this Approach are more likely to introduce innovations that radically Change ustomer behaviours and preferences market-driving is possible when firms "shape" market structure through varying the behaviour of market Players and/or when organizations "shape" market behaviour through varying the behaviour of market players

Market-Driven vs. Market-Driving

Market Driven Approach (binary/octet-stream)

Major Sources of Competitive Advantage

Competitive Triangle (binary/octet-stream)

Levels Of Product Differentiation (binary/octet-stream)

Assessing the External Marketing Situation

The Three Levels In The Marketing System (binary/octet-stream)

The whole Marketing System can be devided into three Levels: focal Company: understanding and analysing the internal Situation Industry Level/value net: the focal company's most important Players/stakeholders at this Level are suppliers, Partners/complementors, competitors and the customers Macro Level: most important changes taking place in the macro Environment can be summarized in the so-called PEST Analysis: P Political and legal factors E Economic factors S Socio-cultural factors T Technological factors

PEST Analysis

Political, Legal, and Economic Factors Marketing decision are strongly affected by developments in the political environment The EU - the Euro and the Enlargement creation of the European single market in 1992 allows the free flow of products and Services, People and capital between the member states introduction of a single European currency, the euro (€), in 2002 enlargement of European market by 10 new member states in 2004 European companies are affected by legislation at EU and national Levels: Major influence at european Level is EU competition; competition policy encourages free competition by removing restrictive practices and other anti-competitive activities campanies operating in member states are also influenced by national law, which could lead to inconsistencies across Europe national bodies are set up to investigate anti-competitive practices; self-regulation also occurs at a national level

PEST Analysis

Socio-Demografic and Cultural Environment Demographic Factors demographic Environment is of Major interest to marketers because it involves People and People make up relevant markets the over 50s own around three quarters of the worlds financial assets and control half of the discretionary budget however, 95% of consumer Advertising is made for under 50s youth market has also become more affluent and poses new opportunities for marketers many western societies are becoming increasingly multi-ethnic Social Factors customers are becoming increasinglydemanding of the products and Services they buy; customers demand and expect reliable products with quick, efficient Service at reasonable prices environmental pressure Groups Impact on Business; companies spend large amounts on corporate Advertising each year to demonstrate their concern and care for the environment

PEST Analysis

Cultural Factors institutions and other Forces that affect a society's Basic values, preferences, perceptions and behaviours Power Distance extent to which the less powerful members of Society accept that power is distributed unequally in corporations inequality in power ist inevitable because it serves an important function and is usually formalized in hierarchical Boss-subordinate relationships Uncertainty Avoidance extent to which People try to avoid situations where expectations and outcomes are not clear Individualism relationships between an individual and the Groups to which he/she belongs; cultural belief that the Person Comes first Masculinity (Goal Orientation) aggressive and materialistic behaviour of mankind

PEST Analysis

Long-Term Orientation extent to which People within a culture have a Long-term vs short-term Outlook on work, life and other aspects of society Religion affetcs markets in a variety of ways one of the foundations of Moral teachings in most civilizations and as such defines and informas the kinds of Problems faced in the market by buyers (consumers) and sellers (marketers) Technological Factors involves Forces that create new technolgies, generating new products and market opportunities

Analysing Buying Behaviour in B2C

buying behaviour of final consumers An understanding of customers can be gained by answering the following questions (Jobber, 2010): Who is important in the buying decision? identification of the roles played within the buying centre How do they buy? S-O-R model What are their choice criteria? level of involvement, depending on perceived importance to the consumers self-image Where do they buy? When do they buy?

Sor Model (binary/octet-stream)

Analysing Buying Behaviour in B2B

organizations buy to enable them to provide goods to a final customer both encompass the behaviour of human beings organizational buyers are affected by environmental and individual factors organizational buying is usally a group decision with different roles involved: initiator influencers/evaluators gatekeepers decider purchaser users

many products are more complex and require specialist knowledge to purchase and are changed according to the specifications of the buyer -> more communication and negotiation between seller and buyer neccessary! demand for organizational goods is derived from customer markets organizational buying can be categorized in buy classes depending on how complex they are: straight re-buy modified re-buy new task

Influences from the Environment

Macro Level most important changes taking place in the macro environment can be summarized using the PEST-analysis   P Political and legal factors E Economic factors S Socio-cultural factors T Technological factors   Industry level / value net the focal company's most important actors/stakeholders at this level are suppliers, partners/complementors, competitors and customers The focal company understanding and analyzing the internal situation      

     

SWOT analysis

Strenghts determine your organization's strong point from an internal view as well as from the external customers view Weaknesses determine your organization's weaknesses from an internal view as well as from the external customers view Opportunities determine how your company can continue to grow within the marketplace Threats external, uncontrollable factors

Actions suggested by the SWOT matrix make a match between strengths and opportunities convert weaknesses to strengths convert threats to opportunities minimize, if not avoid, weaknesses and threats

Application of the SWOT analysis

Application Of Swot Matrix (binary/octet-stream)

matching of specific internal and external factors Four combinations that could result from SWOT analysis Maxi-Maxi (S/O): shows the organization's strengths and opportunities; an organization should strive to maximize its strengths to capitalize on new opportunities Maxi-Mini (S/T): shows the organization's strengths in consideration of threats; an organization should strive to use its strengths to parry or minimize threats Mini-Maxi (W/O): shows the organization's weaknesses in tandem with opportunities; encourages the organization to conquer its weaknesses by making the most out of any new opportunities Mini-Mini (W/T): shows the organization's weaknesses by comparism with the current external threats; defensive strategy to minimize an organiztion's internal weaknesses and avoid external threats

Barriers to conductiong a SWOT analysis

Lack of guidance on how to do it   Better management information systems   Pressure on managers   Complexity of many companies

Multilevel SWOT analysis

Multilevel Swot (binary/octet-stream)

Strategic Market Planning

Vision and mission statement business vision: "Where we wish to go / What we wish to become?" business mission: "Who we are and what is the overall purpose of our business?" mission statements should be driven by three factors: heritage: the organization's history ressources: everything the organization can manage environment: everything happening currently that affects the company's ability to achieve objectives or implement strategies, both inside and outside the organization Strategic objectives specific and measurable performance standards for strategically important areas criteria which will be used to assess performance and then specify a desired level of achievement for each criterion

Strategic Market Planning

Estimation of the planning gap, and problem diagnosis gap may stem from the difference between future desired profit objectives and a forecast of projected profit based on past performance and following existing strategy close the gap: revising objectives in a downward direction initiate actions designed to move the company off the projetion curve and towards the desired curve

Planning Gap (binary/octet-stream)

Ansoff's Generic Strategies for Growth

Ansoff (binary/octet-stream)

Ansoff2 (binary/octet-stream)

Ansoff's Generic Strategies for Growth

Market penetration organizations seeking to grow by gaining a larger market share in their current industry or market follow a penetration strategy: increase market share on current markets with current products winning competitor's customers increase product share (increase frequency of use, increase quantity used, new applications) buying competitors protect the penetration already gained by discouraging competitive entry market entry barriers (MEB): cost advantages, high switching costs, high marketing expendidures, displaying aggressive tendencies to retaliate

Product development strategies introducing new products or services in current markets product improvements product-line extensions new products for same market  

Ansoff's Generic Strategies for Growth

Market development strategies organization retains the same products but seek new markets geographic expansion (new countries/regions) new segments/customer groups Diversification strategies pursuing growth by introducing new products/technologies in new markets/industries vertical integration (forward or backward integrtion) diversification into related businesses (concentric diversification) diversification into unrelated businessess (conglomerate diversification)

Levels Of Gaps (binary/octet-stream)

Porter's Three Generic Strategies

Generic Strategies (binary/octet-stream)

Cost leadership strategy achievement of the lowest cost position option of charging lower prices than its competitors to achieve higher sales and yet achieve comparable profit margins Differentiation strategy involves the selection of one or more choice criteria that are used by many customers in an industry company aims to uniquely positioning itself to meet these criteria better than the competition goal is to differentiate in a way that leads to a price premium

Porter's Three Generic Strategies

Generic Strategies (binary/octet-stream)

Focused differentiation strategy company aims to differentiate within one or a small number of target segments Cost fucus strategy company seeks a cost advantage with one or a small number of target market segments

The BCG Portfolio Matrix Model

business portfolio analysis where management evaluates the products and business units maing up the company identify the key strategic business units (SBU); SBUs have a separate mission and objectives and can be planned independently assess the attractiveness of its various SBUs and decide how much support each one deserves Advantages of portfolio matrix encourages management to evaluate the prospects of each of the company's businesses individually and to set tailored objectives for each business based on the contribution it can make to corporate goals stimulates the use of externally focused empirical data raises the issue of cash-flow balancing gives management new tool for analyzing competitors and for predicting competitive responses to strategic moves provides financial and strategic context for evaluating acquisitions and divestitures

The BCG Portfolio Matrix Model

Bcg Model (binary/octet-stream)

Stars high-growth market leader large amount of cash, heavy reinvestment best profit opportunity available to a company generates net of its own reinvestment Cash Cows low growth, high market share, net providers of cash high earnings, very little reinvestments generate large cash surpluses, foundation on which everything else depends  

The BCG Portfolio Matrix Model

Bcg Model (binary/octet-stream)

Question Marks products in a growth market, low market share require more cash than they are able to generate on their own market share needs to grow so that the question mark does not remain a cash loser throughout its existence and ultimately become a cash trap Dogs low market share, low-growth situation poor competitive position, poor profits little potential for gaining sufficient share to achieve viable cost positions net users of cash reinvestments required just to keep the business together eats cash inflow

The BCG Portfolio Matrix Model

Bcg Model Strategies (binary/octet-stream)

Multifactor Portfolio Approach

Multifactor Portfolio Matrix (binary/octet-stream)

Strategy Evaluation and Selection

Criteria evaluating adequacy of a strategy Suitability - Is there a sustainable advantage?   Validity - Are the assumptions about the external environment realistic?   Feasibility - Do we have the skills, ressources and commitment?   Internal consistency - Does the strategy hang together?   Vulnerability - What are the risks and contingencies?   Workability - Can we retain our flexibility?   Appropriate time horizon - Do we allow enough time for implementation?

Strategy Evaluation and Selection

Classification of competitive strategies Operational excellence: superior value by leading its industry in price and convenience; reduce costs, create lean and efficient value-delivered system; reliable, good-quality products or service, cheap and easy; example: Wal-Mart   Customer intimacy: superior value by precisely segmenting its markets and tailoring its products or services to match exactly the needs of targeted customers; specializes in satisfying unique customer needs through a close relationship with and intimate knowledge about the customer; customers are willing to pay a premium to get precisely what they want; specialize in satisfying unique needs; examples: Ritz Carlton, Sony, Lexus   Product leadership: superior value by offering a continuous stream of leading-edge products and services; open to innovations and idea, relentlessly pursue new solutions and work to get net products on the market instantly; customers want state-of-the-art products and services regardless of the costs in terms of price; examples: Intel, Microsoft

The Segmentation Process

Advantages useful approach to marketing for the smaller company   allows target markets to be matched to company competencies   helps to identify gaps in the market   helps to identity specific segments that are still in growth   enables the marketer to match the product or service more closely to the needs of the target market   advantages can be lost to competitors if the company fails to take advantage of them

The Segmentation Process

To be useful, market segments have to be: measurable   accessible   sustantial   differential   actionable

The STP Approach

Stp Approach (binary/octet-stream)

Segmenting Consumer Markets (B2C)

Socio-demographic segmentation Geographic segmentation different geographical units, countries or regions widely used, at least as one element in a combination of segmentation base most powerful and useful wh considering international markets Gender segmentation of the total potential market of all adults will result in a smaller identified target gender as a first step in segmentation process, but then further refine their targets within the chosen gender category in some markets the most relevant segmentation base

Age basic segmentation variale in many markets significant differences in behaviour and product/service requirements between the demographic segments indentified Family life cycle consumers pass through a series of quite distinct phases in their lives Occupation/social class in many developed economies, official socio-economic group (social class) categorizations are based upon occupation increasing doubt as to the extents to which social class is nowadays a meaningful basis for segmenting some markets    

Segmenting Consumer Markets (B2C)

Subculture groups within the overall society that have peculiarities of attitude or behaviour the major subcultures used for segmentation purposes are based on racial, ethnic, religious or geographic similarities Personality characteristics

Segmenting Business Markets (B2B)

Segmentation B2b (binary/octet-stream)

"Nested" Approach to B2B Segmentation

Nested Approach (binary/octet-stream)

Positioning Map (binary/octet-stream)

Positioning Map