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Advanced Marketing Planning

by
Professor Malcolm McDonald
Cranfield School of Management

8th November 2000


Definition of marketing

Marketing is a process for:


● understanding markets

● quantifying the value required by the different groups

(segments) within these markets


● communicating this value to those responsible for

delivering it
● measuring the effectiveness of the value actually

delivered
Map of the marketing domain
Define markets
& understand
value

Monitor Asset Create


value Base value

Deliver
value
Application areas
Define markets
Planning
& understand support
value tools

Data
warehouse
Intranet

Monitor Create
value value proposition
CRM
Internet

Communicate
& deliver
value
Define markets and understand value

Define
markets & segments
- Corporate
mission/objectives
- External data
inc. market research Understand *
- Internal data value required
from value delivery (by the customers)

Evaluate * Understand
competitor value
market/segment
attractiveness positioning

Analysis
Key elements of world class marketing

1. Profound understanding of the market-place


2. Creative segmentation and selection
3. Powerful differentiation positioning and branding
4. Effective marketing planning processes
5. Long-term integrated marketing strategies
6. Institutionalised creativity and innovation
7. Total supply chain management
8. Market-driven organisation structures
9. Careful recruitment, training and career management
10. Vigorous line management implementation
Personalising segments

OIO0599.7
Create the value proposition

Analysis
Choose markets/
Corporate
segments
objectives

*
Define objectives
value received
Define price/value
proposition
Define marketing
Cost
strategies
Convenience
How value is to be delivered /
Communication
communicated
Consumer wants
& needs Price
- product/service Place - distribution
benefits Promotion * - marketing
communications
Product/service - features
- customer service

Estimate expected results


Value received and budgeting

Marketing Plan(s)
Deliver value
Define Create value
Markets proposition

New market creation modifications to value


proposition / marketing strategy
Supplies Products Services

Deliver the product / service

Research & Inbound Outbound


development logistics Operations Service
logistics

Exchange information

Communicate the offer (implement integrated marketing communications plan) Monitor Mgr. Comm.

Across media:
programs
Measurement: *
Design and implement
marketing communication programs
* • Mass media
• Mail
Attitudes
- awareness
• Telephone - perceptions
• Personal contact - etc
Design program Negotiate/tailor
• Electronic eg Net Behaviour
Initiate dialogue Commit
• etc - conversion rates
Exchange information Exchange value
- etc

Customer information
Define marketing strategy for promotion
e.g test drive,
demonstration,
5 senses
Place
Channel/Medium Distribution
Choice Strategy

Mass media Direct mail Telephone Personal Electronic Other


- objectives - objectives contact - objectives - PR
- objectives
- message strategy - strategy - objectives - strategy - POS
- strategy
- media strategy - strategy - etc

Integrated marketing
communications plan
Monitor value

Value required Value delivered Value received How value delivered


(by customers) vs proposition (by us) / communicated vs
latest vs vs objectives marketing strategies
expected
• Product / service vs
plan (R&D, Operations)
• Promotions vs plan
• (IMCP)
• Place vs plan
• (Distribution Plan)
• Price vs plan
Define markets & understand value
Analysis
IT Define Market research
Support markets/segments aggregation/
analysis Planning
for Market mapping support
Understand value Causal Segmentation tools
Marketing Plan required models SWOT
Effectiveness Compet. Analysis NPD Create
Evaluate Understand Portfolio analysis Planning value
market/segment competitor value Forecasting
attractiveness positioning proposition
Monitor
value Size/share Choose
Monitor vs Revenue/Profit Purchase markets/segments
Retention propensity
Value Value Plan
required delivered Operational CLV Data Channel
EIS Warehouse choice Define objectives
How value Allocation of customers
Value
received delivered/ to segments
communicated Define price/value
Operational implications
ERP proposition
CRM
System
Define marketing
Deliver value Program monitoring
strategies
Customer interface
Deliver product/service
Customer
Inbound Outbound Estimate expected
information R&D Operations Service
logistics logistics results

Exchange information

Communicate value Marketing


Design/implement marketing communication programmes Plan(s)
R&D support Monitor
Design program Negotiate/ tailor
Data analysis marcom
Initiate dialogue Commit
Project programmes
Exchange information Exchange value
management
Key areas for improvements in strategic
marketing planning

General comments
A strategic marketing plan should be a clear and simple
summary of key market trends, key target segments, the
value required by each of them, how we intend to create
superior value (to competitors), with a clear prioritisation of
marketing objectives and strategies, together with the
financial consequences.

Frequently, they are diffuse, confusing compilations for


unconnected individual sections.
Barriers to marketing planning

1. Cultural Lack of belief in planning and/or


marketing and/or need to change
2. Behavioural Lack of top management support;
lack of cross functional involvement
3. Cognitive Lack of knowledge and skill
4. Systems & Lack of data and/or inappropriate
procedures systems
5. Resources Lack of time, people and money
All of these factors are inter-dependent i.e. change
one, it impacts on another
Lack of Knowledge and Skills
Key marketing concepts/tools, linkages.
The need for marketing planning
Mktg.
MIS Product
Audit
Gap Management

Analysis Brands
Mktg. Ansoff
Res. Matrix
Position

Life
Product cycle
Promotion
Mngmt. Place Management Mkt.
Management Diffusion Growth
Price
Mkt.
Boston Share
Sales
Channel Matrix
Promotion Segmen-
mngmt.
tation
PIMS
Adv. Objectives,
Customer
Strategies,
Service
Sales Programmes,
Marketing
Force Budgets, Forecasts,
Organisation
Plans
PDM
Assumptions
The marketing The output of the marketing planning process Marketing theory
Planning process
Strategic marketing plan contents (Structures, frameworks, models)

Phase 1 Mission statement


Goal setting
Financial summary
Marketing audit
Market research
Phase 2 Market segmentation studies
Market overview Gap analysis
Situation review
Market structure
Market trends Product life cycle analysis
Key market segments Diffusion of innovation
Gap analysis Ansoff matrix
Forecasting
Market research
Opportunities (By product)
(By segment) Issue management
Threats
(Overall)
Strengths (By product)
Weaknesses (By segment)
(Overall) Key success factors matrix
(By product) Market research
Issues to be Market segmentation studies
Addressed (By segment)
(Overall)

Portfolio summary B.C.G. Matrix


Directional policy matrix

Assumptions Downside risk assessment

Phase 3 Marketing (By product)


Objectives (By segment)
Strategy Porter matrix
Formulation (Overall)
Ansoff matrix
Strategic focus Bcg matrix
Product mix Directional policy matrix
Product development Gap analysis
Product deletion
Market extension
Target customer groups
Marketing (4 x 4 ps) Market segmentation studies
Strategies (Positioning/branding) Market research
Product Response elasticities
Price
Promotion McDonald PRODUCTIVITY MATRIX
Place Blake mouton matrix
Phase 4 Resource Forecasting
Resource Requirements Budgeting
Allocation
And monitoring Measurement and review

Marketing planning and marketing theory (structures, frameworks, models etc.)


© Copyright, professor Malcolm h.B. McDonald 1987
Cranfield Centre for Advanced
Technology in Marketing

Objective of Centre

To develop solutions, via information technology,


which make available the power of marketing tools,
techniques and processes, to personnel at all
levels within an organisation, who have an
influence on marketing.
Hierarchical decomposition of the
tasks involved in producing a strategic
marketing plan (1)

Business unit
Mission & targets
Definitions
Product markets

Financial performance
Conduct audit SWOT analysis
Summarise audit

Financial performance
Produce a
strategic Predict trends Update SWOT analysis
marketing
Summarise trends
plan

Define marketing objectives


Set objectives
& strategies Define marketing strategies

Assess objectives
Hierarchical decomposition of the tasks involved in
producing a strategic marketing plan (2)
Life cycle
Financial
performance
Porter
matrix

Strengths &
weaknesses CSF bar
chart

Perpetual
SWOT map
Opportunities
analysis
& threats
Competitor
Conduct audit analysis

Market MAF bar


attractiveness chart

Aggregated
life cycle

Gap
analysis
Summarise
audit
Boston
matrix

Directional
policy matrix
Some major technique interrelationships
used in strategic marketing planning
Cost volume Product life forecast Gap
experience cycle analysis
curve

cost future data Market risk


gap
segmentation categories

Porter Boston
matrix New product
matrix
development
priorities,
portfolio
differentiation positioning balance
new
ideas,
CSF bar
horizontal
Strategy risk Ansoff
chart Matrix
axis Formulation
product-
axes priorities, future potential
market
positioning portfolio balance choice

Perceptual Directional vertical Market


map policy matrix axis attractiveness

Key: provides x as input to