Chapter 2
Strategic Planning and the
Marketing Process
“If you do not know where
you are going, any road will
take you there!”
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Formal Planning

Many companies operate without formal plans,
yet these plans can provide many benefits such
as:

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Encouraging management to think ahead
systematically.
Forcing managers to clarify objectives and policies.
Better coordination of company efforts.
Clearer performance standards for control.
Helping the company to anticipate and respond
quickly to environmental changes and sudden
developments.
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Strategic Planning
Strategic Planning is the Process of
Developing and Maintaining a Strategic
Fit Between the Organization’s Goals
and Capabilities and Its Changing
Marketing Opportunities.
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Steps in Strategic Planning
(Fig. 2.1)
Business unit,
product,
and market
level
Corporate Level
Defining the
Company
Mission
Setting
Company
Objectives
and Goals
Designing
the Business
Portfolio
Planning,
marketing,
and other
fuctional
Strategies
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Defining the Company’s
Business and Mission
A Mission Statement is a Statement of the Organization’s Purpose.
Market Oriented
Characteristics of
a Good Mission
Statement:
Realistic
Specific
Fit Market Environment
Distinctive Competencies
Motivating
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Mission Statement – Dell
Corporation
Dell's mission is to be the most successful computer company in the
world at delivering the best customer experience in markets we serve.
In doing so, Dell will meet customer expectations of:
•Highest quality
•Leading technology
•Competitive pricing
•Individual and company accountability
•Best-in-class service and support
•Flexible customization capability
•Superior corporate citizenship
•Financial stability
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Mission Statement – McDonald’s
“To be the world's best quick service restaurant experience.
Being the best means providing outstanding quality, service,
cleanliness and value, so that we make every customer in
every restaurant smile. To achieve our mission, we are
focused on three worldwide strategies:
•Be the best employer for our people in each community around the
world.
•Deliver operational excellence to our customers in each of our
restaurants.
•Achieve enduring profitable growth by expanding the brand and
leveraging the strengths of the McDonald's system through innovation
and technology. “
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Mission Statements – Cont’d
"To provide economy and quality minded travelers with a
premier, moderate priced lodging facility which is
consistently perceived as clean, comfortable, wellmaintained, and attractive, staffed by friendly, attentive
and efficient people" – Courtyard by Marriott
“We at Four Seasons will be recognized as a national
premier resort by providing a quality experience for our
guests' property owners, and ourselves, through
maximum service, value, and satisfaction while
maintaining an economically sound business
environment.” – Four Seasons
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Setting Company Objectives
and Goals
Mission
Statement
Marketing
Objective # 1
Marketing
Strategy
Marketing
Strategy
Marketing
Objective # 2
Marketing
Strategy
Marketing
Objective # 3
Marketing
Strategy
Marketing
Strategy
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Designing the Business
Portfolio


The business portfolio is the collection of
businesses and products that make up the
company.
The company must:



analyze its current business portfolio or Strategic
Business Units (SBU’s)
decide which SBU’s should receive more, less, or no
investment
develop growth strategies for adding new products or
businesses to the portfolio
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Analyzing Current SBU’s:
Boston Consulting Group Approach
Relative Market Share
Low
Market Growth Rate
High
High
Stars
• High growth & share
• Profit potential
• May need heavy
investment to grow
Cash Cows
• Low growth, high share
• Established, successful
SBU’s
•Produce cash
Low
Question Marks
?
• High growth, low share
• Build into Stars or phase out
• Require cash to hold
market share
Dogs
• Low growth & share
• Low profit potential
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Problems With Matrix
Approaches
Can be Difficult, Time-Consuming, & Costly to Implement
Difficult to Define SBU’s & Measure Market Share/ Growth
Focus on Current Businesses, But Not future Planning
Can Lead to Unwise Expansion or Diversification
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Developing Growth Strategies
in the Age of Connectedness
Product/ Market Expansion Grid
Existing
Products
Existing
Markets
1. Market
Penetration
New
Markets
2. Market
Development
New
Products
3. Product
Development
4. Diversification
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Product/ Market Expansion
Grid

Market Penetration: making more sales to
current customers without changing its
products.

How? Add new stores in current market areas,
improve advertising, prices, service or store
design.
 Market Development: develop new
markets for its current products.
 How? Identify new demographic or
geographic markets.
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Product/ Market Expansion
Grid

Product Development: offering modified
or new products to current markets.

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How? New styles, flavors, colors, or modified
products.
Diversification: new products for new
markets.

How? Start up or buy new businesses.
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Planning Cross-Functional
Strategies
Marketing’s Role in Strategic Planning
Guiding
Philosophy
Inputs to
Strategic
Planners
Designs
Strategies
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The Marketing Process
(Fig. 2.5)
DemographicEconomic
Environment
TechnologicalNatural
Environment
Marketing
Intermediaries
Product
Suppliers
Place
Target
Consumers
Price
Publics
Promotion
PoliticalLegal
Environment
Competitors
SocialCultural
Environment
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Connecting With Customers


Market Segmentation: determining distinct groups
of buyers (segments) with different needs,
characteristics, or behavior.
Market Targeting: evaluating each segment’s
attractiveness and selecting one or more segments
to enter.
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Connecting With Customers
Market Positioning: arranging for a product to
occupy a clear, distinctive, and desirable place
relative to competing products in the minds of
target consumers. i.e. Chevy Blazer is “like a rock.”
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Developing the Marketing Mix
Price
Product
Amount of money
that consumers
have to pay to
Obtain the product
“Goods-and-service”
combination that a
company offers a
target market
Target
Customers
Intended
Positioning
Activities that
persuade target
customers to buy
the product
Promotion
Company activities
that make the
product available
Place
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The 4 P’s & 4C’s of the
Marketing Mix
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4 P’s
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Product
Price
Place
Promotion
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4 C’s
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Customer Solution
Customer Cost
Convenience
Communication
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Managing the Marketing
Effort (Fig. 2.7)
Marketing Analysis of Company’s Situation
Marketing
Planning
Marketing
Implementation
Develop Strategic
Plans
Carry Out
The
Plans
Develop
Marketing
Plans
Control
Measure
Results
Evaluate
Results
Take
Corrective
Action
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Contents of a Marketing Plan
(Table 2.2)
Executive Summary
Current Marketing Situation
Threats and Opportunity Analysis
Objectives and Issues
Marketing Strategy
Action Programs
Budgets
Controls
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Review of Concept
Connections
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Explain company-wide strategic planning and its
four steps.
Discuss how to design business portfolios and
growth strategies.
Explain functional planning strategies and asses
marketing’s role in strategic planning.
Describe the marketing process and the forces
that influence it.
List the marketing management functions,
including the elements of a marketing plan.
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