CHAPTER
DEVELOPING
SUCCESSFUL
MARKETING
AND
CORPORATE
STRATEGIES
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-1
AFTER READING THIS CHAPTER
YOU SHOULD BE ABLE TO:
1. Describe the three organizational levels
of strategy.
2. Describe why business, mission,
organizational culture, and goals are
important in organizations.
3. Explain how organizations set strategic
directions by assessing where they are
now and seek to be in the future.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-2
AFTER READING THIS CHAPTER
YOU SHOULD BE ABLE TO:
4. Describe the strategic marketing
process and its three key phases:
planning, implementation, and control.
5. Explain how the marketing mix
elements are blended into a cohesive
marketing program.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-3
WHERE CAN AN “A” IN
ICE CREAM MAKING LEAD?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-4
ORGANIZATIONS AND THEIR
LEVELS OF STRATEGY
• Profit
• Kinds of Organizations
 Business Firm
 Nonprofit Organization
 Firm, Company, Corporation, Organization
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-5
ORGANIZATIONS AND THEIR
LEVELS OF STRATEGY
• Levels in Organizations and How
Marketing Links to Them
 Corporate Level
 Strategic Business Unit (SBU)
 Business Unit Level
 Functional Level
 Department
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-6
FIGURE 2-1 The three levels of strategy
in organizations: corporate, business unit,
and functional
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-7
ORGANIZATIONS AND THEIR
LEVELS OF STRATEGY
• Strategy Issues in Organizations
 The Business
 The Mission (Mission Statement/Vision)
 Organizational Culture
• Stakeholders
• Organizational Culture
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-8
Medtronic’s “Rising Figure” Mural
What does it signify to stakeholders?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-9
ORGANIZATIONS AND THEIR
LEVELS OF STRATEGY
• Strategy Issues in Organizations
 Goals or Objectives
• Profit
• Customer Satisfaction
• Sales
• Employee Welfare
• Market Share
• Social Responsibility
• Quality
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-10
Concept Check
1. What are the three levels in today’s
large organizations?
A: The corporate, business unit, and
functional levels exist in large
corporations.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-11
Concept Check
2. What is the meaning of an
organization’s mission?
A: Mission is a statement of the
organization’s scope, often
identifying its customers, markets,
products, technology, and values.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-12
Concept Check
3. How do an organization’s goals
relate to its mission?
A: Goals or objectives measure how
well the organization’s mission is
being accomplished.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-13
SETTING STRATEGIC DIRECTIONS
• A Look Around: Where Are We Now?
 Customers
 Competencies
• Competitive Advantage
 Competitors
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-14
Lands’ End Unconditional Guarantee
What is the strategic focus?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-15
SETTING STRATEGIC DIRECTIONS
• Growth Strategies: Where Do We Want
to Go?
 Business Portfolio Analysis (BCG)
• Market Growth Rate
• Relative Market Share
 Cash Cows
 Question Marks or Problem Children
 Stars
 Dogs
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-16
FIGURE 2-2 Boston Consulting Group
portfolio analysis for Kodak, as it might
appear in 2006
Kodak digital
camera
Kodak digital
photo printer
Kodak film sales: US,
Canada, & W. Europe
Kodak selfservice kiosk
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-17
Kodak Traditional Film Cartridge
What SBU type in the BCG growth-share matrix?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-18
Kodak Digital Camera
What SBU type in the BCG growth-share matrix?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-19
Kodak Digital Photo Printer
What SBU type in the BCG growth-share matrix?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-20
Kodak Picture Maker Self-Service Kiosk
What SBU type in the BCG growth-share matrix?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-21
SETTING STRATEGIC DIRECTIONS
• Growth Strategies: Where Do We Want
to Go?
 Market-Product Analysis
• Market Penetration
• Market Development
• Product Development
• Diversification
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-22
FIGURE 2-3 Four market-product strategies:
alternative ways to expand sales revenues
for Ben & Jerry’s
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-23
Concept Check
1. What are competencies and why are
they important?
A: Competencies are an organization’s
special capabilities, including skills,
technologies, and resources that
distinguish it from other organizations,
which if exploited, can lead to the
organization’s success.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-24
Concept Check
2. What is business portfolio analysis?
A: Business portfolio analysis studies a
firm’s business units as though they
were a collection of separate
investments.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-25
Concept Check
3. What are the four market-product
strategies?
A: (1) market penetration; (2) market
development; (3) product
development; and (4) diversification.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-26
THE STRATEGIC MARKETING
PROCESS
• How do we allocate our resources to get where
we want to go?
• How do we convert our plans to actions?
• How do our results compare with our plans,
and do deviations require new plans?
 Strategic Marketing Process
 Marketing Plan
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-27
FIGURE 2-4 The strategic marketing
process
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-28
THE STRATEGIC MARKETING
PROCESS
• Strategic Marketing Process:
The Planning Phase
 Step 1: Situation (SWOT) Analysis
• Situation Analysis
• SWOT Analysis
 Strengths
 Weaknesses
 Opportunities
 Threats
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-29
FIGURE 2-5 Ben & Jerry’s: a SWOT analysis
to get it growing again
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-30
Ben & Jerry’s One Sweet Whirled Campaign
What is the impact of a SWOT analysis?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-31
THE STRATEGIC MARKETING
PROCESS
• Strategic Marketing Process:
The Planning Phase
 Step 2: Market-Product Focus and Goal Setting
• Market Segmentation
• Set Marketing and Product Goals
• Select Target Markets
• Find Points of Difference
• Position the Product
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-32
Medtronic’s Champion Heart Pacemaker
What features are important to the Asian market?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-33
THE STRATEGIC MARKETING
PROCESS
• Strategic Marketing Process:
The Planning Phase
 Step 3: Marketing Program
• Product Strategy
• Price Strategy
• Promotion Strategy
• Place (Distribution) Strategy
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-34
FIGURE 2-6 Elements of the marketing mix
that comprise a cohesive marketing program
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-35
Concept Check
1. What is the difference between a
strength and an opportunity in a
SWOT analysis?
A: Both are positive factors for the
organization, but a strength is an
internal factor whereas an
opportunity is an external one.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-36
Concept Check
2. What is market segmentation?
A: Market segmentation involves
aggregating prospective buyers into
groups, or segments, that (1) have
common needs and (2) will respond
similarly to a marketing action.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-37
Concept Check
3. What are points of difference and
why are they important?
A: Points of difference are those
characteristics of a product that make
it superior to competitive substitutes.
They are the single most important
factor in the success or failure of a
new product.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-38
THE STRATEGIC MARKETING
PROCESS
• Strategic Marketing Process:
The Implementation Phase
 Obtaining Resources
 Designing the Marketing Organization
 Developing Schedules
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-39
FIGURE 2-7 Organization of a typical
manufacturing firm showing a breakdown of
the marketing department
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-40
THE STRATEGIC MARKETING
PROCESS
• Strategic Marketing Process:
The Implementation Phase
 Executing the Marketing Program
• Marketing Strategy
• Marketing Tactics
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-41
Kodak EasyShare Cameras in China
What marketing strategy & tactics are used?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-42
THE STRATEGIC MARKETING
PROCESS
• Strategic Marketing Process:
The Control Phase
 Comparing Results With Plans to Identify
Deviations
• Planning Gap
 Acting on Deviations
• Exploiting a Positive Deviation
• Correcting a Negative Deviation
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-43
FIGURE 2-8 Evaluation and control of
Kodak’s marketing program
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-44
Concept Check
1. What is the control phase of the
strategic marketing process?
A: This is the phase that seeks to keep
the marketing program moving in the
direction set for it.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-45
Concept Check
2. How do the objectives set for a
marketing program in the planning
phase relate to the control phase of
the strategic marketing process?
A: The planning phase objectives are
used as the benchmarks to which the
actual performance results are
compared in the control phase.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-46
GOING ONLINE
MEDTRONIC’S MISSION
STATEMENT
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-47
Going Online
1. What stakeholders are specifically
mentioned or implied in Medtronic’s
mission? What values are associated
with each stakeholder?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-48
Going Online
2. What is the scope of Medtronic’s
mission? Why does Medtronic limit
its scope?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-49
Going Online
3. Why does Medtronic NOT define
itself as being in the “medical
device” business?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-50
VIDEO CASE 2
BP: ALLOCATING RESOURCES
TO BRING YOU GASOLINE
AND FRESH BREAD!
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-51
VIDEO CASE 2
BP
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-52
VIDEO CASE 2
BP
1. How does BP use its strategic
marketing process to allocate
resources to opportunities such as the
BP Connect concept? Is BP Connect
consistent with BP’s mission and
values? Explain.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-53
VIDEO CASE 2
BP
2. Conduct a SWOT (strengths,
weaknesses, opportunities, threats)
analysis for the BP Connect
concept—looking forward globally
to the next three years.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-54
VIDEO CASE 2
BP
3. In addition to features such as hightech pumps and twenty-first century
information technology, what other
marketing mix activities would you
recommend as part of Step 3 of the
planning phase?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-55
SUPPLEMENTAL
LECTURE NOTE 2-1
MARKETING VERSUS
BUSINESS PLANS
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-56
FIGURE A-1 Elements in typical marketing
and business plans targeted at different
audiences
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-57
SUPPLEMENTAL
LECTURE NOTE 2-2
PLANNING VS.
IMPLEMENTATION ISSUES
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-58
FIGURE 2-A Results of good and bad
marketing planning and implementation
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-59
SUPPLEMENTAL
LECTURE NOTE 2-3
ORGANIZING FOR
MARKETING
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-60
FIGURE 2-B Organization of a business unit
in a typical consumer packaged goods firm,
showing two product or brand groups
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-61
FIGURE 2-C Units with which the product
manager and product group work
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-62
SUPPLEMENTAL
LECTURE NOTE 2-4
PROJECT SCHEDULING
USING GANTT CHARTS
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-63
FIGURE 2-D Tasks to complete a term
project
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-64
FIGURE 2-E Gantt chart for scheduling the
term project
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-65
IN-CLASS ACTIVITY 2-1
MARKETING YOURSELF
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-66
Yahoo!/Hot Jobs TV Ad
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-67
Sample Résumé
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-68
Sample Cover Letter
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-69
IN-CLASS ACTIVITY 2-2
MARKETING PLANNING
WORKSHEET
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-70
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-71
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-72
Profit
Profit is the reward to a business firm for
the risk it undertakes in offering a
product for sale. It is also the money left
over after a firm’s total expenses are
subtracted from its total sales.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-73
Mission
Mission is a statement of the
organization’s scope, often identifying its
customers, markets, products, technology,
and values.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-74
Organizational Culture
Organizational culture is a set of values,
ideas, and attitudes that is learned and
shared among the members of an
organization.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-75
Goals or Objectives
Goals or objectives convert the mission
into targeted levels of performance to be
achieved, often by a specific time.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-76
Market Share
Market share is the ratio of sales revenue
of the firm to the total sales revenue of all
firms in the industry, including the firm
itself.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-77
Strategic Marketing Process
The strategic marketing process is the
approach whereby an organization
allocates its marketing mix resources to
reach its target markets.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-78
Marketing Plan
A marketing plan is a road map for the
marketing activities of an organization for
a specified future period of time, such as
one year or five years.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-79
Situation Analysis
Situation analysis involves taking stock
of where a firm or product has been
recently, where it is now, and where it is
headed in terms of the organization’s
plans and the external factors and trends
affecting it.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-80
SWOT Analysis
SWOT analysis is an acronym describing
an organization’s appraisal of its internal
Strengths and Weaknesses and its
external Opportunities and Threats.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-81
Market Segmentation
Market segmentation involves
aggregating prospective buyers into
groups, or segments, that (1) have
common needs and (2) will respond
similarly to a marketing action.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-82
Points of Difference
Points of difference are those
characteristics of a product that make it
superior to competitive substitutes.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-83
Marketing Strategy
A marketing strategy is the means by
which a marketing goal is to be achieved,
usually characterized by a specific target
market and a marketing program to reach
it.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-84
Marketing Tactics
Marketing tactics are detailed
day-to-day operational decisions essential
to the overall success of marketing
strategies.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 2-85