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Developing Marketing Strategies and Plans

W hat i s V alue/ Wo rth ? Value refle cts the p ercei ved tangi ble and inta ngible benefit s a nd co st s to custo mer s. Value c an be se en a s pri maril y a combina tion of q ualit y, ser vice , and price (q sp), calle d the "c ust omer val ue triad." Value in crea se s with qualit y a nd ser vice and d ecrea se s with price, although other factor s ca n al so pl ay an importa nt role .
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Contents
1. Mark eting & Cu sto mer Va lue 2. Corporat e & D ivi sio n Strate gic Plann ing 3. Busin ess Unit St rategi c Planni ng 4. Produ ct Plann ing: The natur e & Content s of a Ma rketin g Plan

1.1) The Valu e Deli ver y Pro cess

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1. Mark eting & Cu sto mer Va lue

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Critics of Nike often c omplai n that its s hoes c ost al mos t nothing to make yet cos t the c ons umer so muc h. True, the raw materials and manufac turing costs invol ved in the maki ng of a sneaker are r elati vel y c heap, but mar keti ng the product to the consumer is expensi ve. Materials, labor, s hippi ng, equipment, i mport duties, and suppliers' costs generally total less than $25 a pair. Compens ating its s ales team, its distributors, its administration, and its endorsers, as well as payi ng for advertising and R&D, adds $15 or s o to the total. Nike s ells its product to r etailers to make a profit of $7 . The retailer therefore pays roughly $47 to put a pair of Nikes on the shelf. When the r etailer's overhead (typically $30 c overing personnel, leas e, and equipment) is factor ed in along with a $10 profit, the s hoe costs the consumer over $80.
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1.4) A Holist ic Market ing Or ientation & Cu stomer Va lue

The holistic marketing framework is designed to address 3 key management questions: Value exploration - How can a company identify new value opportunities? Value creation- How can a company efficiently create more promising new value offerings? Value delivery- How can a company use its capabilities and infrastructure to deliver the new value offerings more efficiently?

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1.2) The v a lue chain is a too l for identif ying wa ys to create more cus tomer value because ever y f irm is a synthes is of pr imary and support activities performed to des ign, p roduce, market , delive r, and support its product.
Source: Co mpetit ive Advan tage: Creati ng and Sus taining Supe rio r Per for mance. Copy righ t 1985 by M ichael E. Po rter

2. Corporat e & D ivi sio n Strate gic Plann ing

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1.3) Core Competencies


Nike, for example, doe s not manufacture it s own shoes, because Certain Asian manufacturers are mo re competent in this task; Nike nurture s its superio rit y in s hoe design and shoe merchandis ing , its two core competencie s. Core competency has 3 characterist ics: (1) It is a source of compet itive advantage in that it make s a sign ificant contr ibution to perceived customer benefit s, (2) it has applicat ions in a wide variet y of markets, and (3) it is difficult for compet itor s to imita te.

What is Strategy ? A Voyage on the Bay

Strategic Option

Objective

x
Strategy Formulation Tactics Controls

x
Strategic Analysis

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Example
O bje ctiv e : To ge t fro m Bh ola t o Sa ndwi p Up azila a s fas t as p os sible an d as c he apl y as p ossi ble St ra te gic An alysis D ep ar tur e p oin t / Pric es / W e ath er co nditi on s / Se a c on ditio ns / Tr affic co nditi on s / De pa rt ur e time s / Du ra tio n of jo ur ney . Allo ca te d Res ou rc es B usin ess E xp ens es St ra te gic O ptio ns : B us? R en tal c ar? T axi? H elic op te r sh uttl e? Bo at ? . St ra te gy : Ta ke th e h elico pt er s hu ttle Ta cti cs : C ho os e de p art ur e tim e / Pre p are lu gg a ge / B uy ti ck et / T ak e e ar pl ug s / Bo ar d t he h elic op te r / F ast en s e at b elt ..

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eBay Mission Statement

We help people trade anything on earth. We will continue to enhance the online trading experiences of allcollectors, dealers, small businesses, unique item seekers, bargain hunters, opportunity sellers, and browsers.

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The Strategic Planning, Implementation, and Control Processes

Strategic Business Units (SBUs)


An SBU ha s thre e char acteri sti cs: 1) It is a singl e bu sine ss or colle ction of related busine sses that c an be plann ed separ atel y from t he re st of the compan y. 2) It has it s o wn se t of com petitor s. 3) It has a mana ger who i s r espon sible for strat egic p lanni ng and profit performanc e and who con trol s mo st of the factor s affectin g profit.
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Ansoffs Prod uct- Mark et Expan sio n Grid

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A sse ssi ng Gro wt h Oppor tuniti es

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The Stra tegic Pl annin g Gap

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Strat egic Allia nce s 3. Busin ess Unit St rategi c Planni ng


1) Product or service alliances - One company licenses another to produce its product, or two companies jointly market their complementary products or a new product. For instance, Star Alliance in Airline 2) Promotional alliances- One company agrees to carry a promotion for another company's product or service. McDonald's, for example, has often teamed up with Disney to offer products related to current Disney films as part of its meals for children. 3) Logistics alliances- One company offers logistical services for another company's product. For example, Abbott Laboratories warehouses and delivers all of 3M's medical and surgical products to hospitals across the United States. 4) Pricing collaborations - One or more companies join in a special pricing collaboration. Hotel and rental car companies often offer mutual price discounts.

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The Business Unit Strategic Planning Process

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Strat egy Form ulatio n: Porte rs Gener ic Strate gie s 4) Produ ct Plann ing:
Overall Cost Leadership Differentiation Focus

Th e natu re & Conten ts of a Market ing Plan

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What is a Marketing Plan?


A m ark eting plan is the c entral instru ment for direc ting a nd coordina ting t he ma rketin g effort. It operate s at a strateg ic an d tacti cal level.

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Marketing Plan Contents

Exec uti ve sum mar y Tabl e of cont ent s Situ ation anal ysis Mark eting str ateg y Financi al pro jectio ns Implement ation contr ols

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