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Chapter 4: Marketing plans

Chapter overview
This chapter focuses on designing and actioning a marketing mix so that the company
can maximise customer value and business value. As with other chapters, the key
theme in this chapter is the need for integration between the various levels of strategy
and planning and ensuring that every action within the company is geared towards
creating customer and business value. The nature and contents of a marketing plan are
discussed in detail with illustrations from a life-based case study. The importance of
tasks such as the situation analysis and opportunity and issue analysis are discussed,
as are the need for clear objectives, the need for marketing strategy to integrate the
capabilities and resources of all units to achieve the set objectives, and the need for a
detailed action plan to ensure that each activity is achieved.
Evaluating and implementing the marketing plan are identified as key steps in
ensuring the plan is achieved. Several questions are provided as a checklist that can be
used to evaluate the plan. Several integrative elements are identified as being
necessary to facilitate effective implementation as a competitive advantage can be
gained from more effective implementation of the plan.
Finally, the chapter covers the need for controlling and evaluating the performance of
the marketing strategy, using operating control processes where the ongoing
performance of the plan is evaluated against the objectives and strategic control
process (such as a marketing audit) where the company’s basic strategies are matched
against its opportunities.

Chapter objectives
1. Describe the marketing process.
2. Identify the sections of a marketing plan and specify the contents of each section.
3. Discuss the marketing implementation process.
4. Identify the approaches to marketing an organisation.
5. Explain the ways in which marketing organisations control and evaluate their marketing


This chapter focuses on designing and actioning a marketing mix that will achieve the
objectives set by the company for its target markets, and discusses the process of
analysing, planning, implementing and controlling these activities.
Marketing process: ‘The process of (1) analysing marketing opportunities; (2)
selecting target markets; (3) developing the marketing mix; and (4) managing the
marketing effort’ (p. 116).

Marketing management and planning
The purpose of marketing management and planning is to integrate the goals and
objectives of every level of the organisation to ensure that the company can provide
superior customer value and maximise business value. Four organisational levels are
identified in this section and each requires planning:
• Corporate strategic plan guides the whole enterprise to a profitable future. This
should be developed with input from the various levels that have specialised
knowledge, and communicated and integrated across the entire organisation
• Divisional plan covers the allocation of funds to each business unit in line with the
strategic plan.
• Business-unit strategic plan guides the business unit to a profitable future.
• Product plan to achieve the identified objectives in its product market.
The marketing plan draws on the aggregate of these plans and operates at two levels:
• Strategic marketing plan develops the broad marketing objectives and strategy
based on an analysis of the current market situation and opportunities.
• Tactical marketing plan outlines the specific tactics that will be used to achieve
the broad objectives (advertising, merchandising promotion etc.).
The need for integration of activities across the various organisational levels and
between different functions highlights the need for team work.

Marketing plan or business plan?

There are differences between business plans and marketing plans.

Business plan: focused on customers and competitors and incorporates the plans
of all functions.
Marketing plans: focuses on customer acquisition and retention and the resources
required to do this effectively and implement specific marketing functions.
Effective marketing plans should be realistic, include sufficient competitor
analysis and have a long-term as well as short-term focus.

The nature and contents of a marketing plan

The marketing plan is one of the most important outputs of the marketing process and
relies on effective analysis of the industry, business and product situation. The
important sections of a plan are listed in Table 4.1 (p. 118) and summarised below.
Executive summary

Executive summary: ‘The opening section of the marketing plan that presents a
short summary of the main goals and recommendations to be presented in the
plan’ (p. 119).

Current marketing situation

This section contains information about the market situation, the product
situation, the competitive situation, the distribution situation and the macro-
environment situation. Each of these is summarised below.
Market situation: data from the last few years are presented on
• the target market,
• the size and growth of the market over the last few years
• Customer needs, perceptions and buying behaviour
Product situation: data from the last few years are presented on
• Product prices
• Contribution margins
• Profits
Competitive situation: the major competitors are identified and described in terms
• Size,
• Goals
• Market share
• Product quality
• Marketing strategies
• Other characteristics that will help provide insight into competitors’
intentions and behaviour
Distribution situation: data are presented on the size and importance of each
distribution channel
Macro-environment situation: a summary of trends and changes in the broad areas
• Demographic
• Economic
• Technological
• Political/legal
• Sociocultural
Opportunity and issue analysis

In this section, the major opportunities/threats and strengths/weaknesses are

identified, and the strengths/weaknesses analysis is used to define the main issues
the plan must address.


In this section the financial and marketing objectives are made explicit.
Marketing strategy

In this section the way in which the objectives will be accomplished is identified.
Marketing strategy: ‘the marketing logic by which the business unit hopes to
achieve its marketing objectives. Marketing strategy consists of specific strategies
for target markets, marketing mix and marketing expenditure level’ (p. 126).
The marketing strategy should integrate the capabilities of all units and functions
and specifically make sure that enough resources (both human and financial) are
provided to meet the required sales-volume levels.
Action programs

In this section the broad marketing programs designed to meet the business
objectives are elaborated. The action plan must address
• What will be done?
• When will it be done?
• Who will do it?
• How much will be spent?
Projected statement of financial performance

This section provides a budget that supports the action plan, showing revenue and
detailed expenses involved. Once approved this budget is the basis for developing
plans and schedules for
• Material procurement
• Production scheduling
• Employee recruitment
• Marketing operations

This section outlines the controls for monitoring the plan as a basis for
assessment/evaluation of its progress and effectiveness and may include
contingency plans outlining the steps management would take in response to
specific adverse developments.

Analysing market opportunities

A core activity of marketing planning is to analyse the long-run opportunities in the
market so as to improve the business unit’s performance.
Marketing information system: To evaluate opportunities a reliable marketing
information system is required so that the company is aware of how the needs of its

target market(s) can best be served to provide customer value, and how business value
can best be maximised.
The purpose of market research is to
• Gather information about the marketing environment (macro and micro
• Measure market potential
• Forecast demand
The company needs to be clear about which type of market it is operating in
(consumer, institutional, government etc.) and address the following questions:
• How many people buy the type of product the company offers?
• Who buys that product type?
• Why do they buy the product type?
• What are their needs and wants in relation to the product type?

Evaluating the marketing plan

There are a series of questions that should be addressed before the marketing plan is
implemented. It is argued that if all answers are positive, the marketing plan will be
effective. These questions are:
• Do your marketing objectives relate directly to:
o The company strategic objectives?
o What you learned in your situational analysis?
o The capacity of your current marketing mix to handle them?
o Your business’ strengths and to the opportunities available?
o Your business’ weaknesses and to the threats that endanger it?
• Are your marketing objectives clear, measurable statements of what is to be
• Do your marketing objectives, strategies and tactics relate to each other?
• Does each strategy in your marketing plan contain a cost-benefit evaluation?
• Is every person involved in implementation included in the marketing
planning process in some way?
• Is the plan clearly visible on your desk every day?
• Is your business’ vision truly a ‘shared vision’?

Implementing the marketing plan

Marketing implementation: ‘the process that turns marketing strategies and plans into
marketing actions in order to accomplish strategic marketing objectives’ (p. 131).
Several integrative elements that facilitate effective implementation are:
• Action programs
• Organisational structure
• Decision-making and reward systems
• Human resource management
• Company culture
A competitive advantage can be gained from faster and/or better execution of the
In keeping with the theme of integration that runs through this chapter, McKinsey’s 7-
S framework illustrates the importance of integrating the hard elements (strategy,
systems and structure) with the soft elements (style, staff, skills, and shared values).
The ability to do so is encapsulated in the concept of the learning organisation.
Learning organisation: a company ‘defined by its ability to innovate, adopt and
change in line with its changing environment’ (p. 133).
Reasons for poor implementation

Poor implementation essentially arises from poor integration of all the relevant
elements. Some reasons are:
• Isolated planning
o Developed by top-level managers who have little direct contact
with those who implement the plan.
o The plan is too general.
o Plans are unrealistic.
o Those who are required to implement the plan resent those who
develop it.

• Trade-offs between long-term and short-term objectives

o A lack integration of aims with resource use can result in trade-
offs. For example, long-range plans focus on the future but those
who implement these strategies may be rewarded for short-run
sales, growth or profits.

• Natural resistance to change

o If a new strategy requires new patterns and habits within a
company it may be resited. The greater the differentiation between
existing patterns and habits with the new ones required, the greater
the resistance.

• Lack of financial and marketing integration

o This often occurs at the business strategy level when the different
functional areas do not understand the concerns of other functional
• Overemphasis on the document
o This is largely due to the ‘political’ aspects of organisations when
the plan is used to ‘score points’. A marketing plan should be
concise, clear and directional.

Factors for successful implementation

People at all levels of the marketing system must work together to implement
marketing plans and strategies The key to effective implementation is the
inclusion of enough detail to ensure the appropriate actions are taken. Planners
must therefore prepare a detailed implementation plan that shows the specific
activities needed to put it in action. The key elements for success are effective
blending of the following:
o An action program that pulls all the people and activities together,
clearly identifying, who, what and when things will be done.
o Organisational structures must facilitate implementation and
successful structures are identified as those that are simple and flexible
allowing for quick adaptation to changing conditions.
o Decision and reward systems should facilitate the achievement of the
o Human resources planning should ensure the appropriate people are
accessible and available.
o Company culture should facilitate the implementation of the plan and
so it is recommended that the marketing strategies fit the culture.

Marketing department organisation

Marketing departments can be arranged in many ways:

Functional: different marketing activities are headed by a functional specialist.
Geographic: sales and marketing people are assigned to specific countries,
regions or districts. This is suitable for companies that sell across the country
or in different countries.
Product management: a product manager develops and implements a
complete strategy and marketing program for a specific product or brand. This
is suitable for companies with many different products or brands.
Market management: a manager develops long-range and annual plans for the
sales and profits in their markets. It is suitable for companies that sell one
product line to many different types of markets with different needs and
Virtual organisation: these are formed when different companies form
alliances with one another to access new markets

Combination: some combination of the above arrangements may be used by
large companies that produce many different products flowing into many
different geographic and customer markets.

Controlling and evaluating performance

Marketing control involves evaluating the results of marketing strategies and plans
and taking corrective action to ensure that objectives are attained. The specific steps
are illustrated in Figure 4.5 (p. 141). Briefly, these are:
o Set goals
o Measure performance
o Evaluate performance
o Take corrective action
Two types of control are identified in this chapter. These are:
Operating control: checking the ongoing performance against the annual plan and
taking corrective action when necessary to ensure that the specific goals are achieved.
Strategic control: looking at whether the company’s basic strategies are well matched
to its opportunities. A major tool for strategic control is the marketing audit, which
provides good input for a plan of action to improve the company’s marketing
Marketing audit: a comprehensive, systematic, independent and periodic examination
of a company’s environment, objectives, strategies and activities to determine
problem areas and opportunities and to recommend a plan of action to improve the
company’s marketing performance’ (p. 141).