Marketing Strategy:

The Company (Ch2)

Stacy Smollin Schwartz

sschwartz@business.rutgers.edu

Agenda
• Company & Marketing Strategy (ch2)
– Strategic Planning Process
– Business Portfolios & Growth Strategies
– Marketing’s Role
– Building a Marketing Plan

Smollin Schwartz 2

2
 The Marketing Process

Analysis Decisions Outcomes

The 5 Cs Aspirational Marketing Mix Relationship Capture Value

• Customers Decisions Decisions (4 Ps) Management • Create Satisfied,
•• Company
Company • Segmentation • Product • Customers Loyal Customers
• Competitors • Targeting • Place • Partners • Capture
• Collaborators • Positioning • Promotion Customer LTV
• Context • Price • Increase
marketshare

Smollin Schwartz 3

Strategic Planning Process

Strategic planning helps maintain strategic fit between

goals / capabilities and __________ ____________
changing marketing opportunities
_________________.

Smollin Schwartz 6

6
 Mission Statement

“To be our customers' favorite place and way to eat and drink.”

• Market (customer) oriented

_______________
• Purposeful
• Emphasizes strengths
• Aspirational
• Clarifies what’s in, and what’s out

“To connect people around their world and help them share
important moments in their lives.”
“To bring the world closer together.” (June 2017)

Smollin Schwartz 7

Company Goals and Objectives

objectives
• Mission leads to long-term ______________ .
– Business objectives
– Marketing objectives
• Objectives achieved through short-term strategic
goals
______________ .

Why we Long-term Short-

Objectives
Mission

Goals

exist strategic term

state you milestones
want to that build
achieve toward
objectives
Smollin Schwartz SMART 9

9
 Mission Statement

Short-term
Goals

Desired
Future State

Current State

Smollin Schwartz 11

11

Designing the Business Portfolio

Business Portfolio is a collection of businesses and

products that make up the company.

• Steps in business portfolio planning:

– Analyze current business portfolio
– Strategies for growth / downsizing to shape future portfolio
• The purpose is to direct resources toward more
profitable ___________ __________ _________
strategic business units
(SBUs) while phasing out or dropping weaker ones.

Smollin Schwartz 13

13
 The BCG Growth-Share Matrix
Market Attractiveness

Smollin Schwartz 15
Company Strength in that Market

15

Problems with Growth-Share Matrix

• Time consuming and expensive to implement
• Difficult to define SBUs and measure market
share and growth
• Focuses on classifying current businesses but
provide little advice for future planning
• Presumes the market will act predictably, with
future success based on current market share

Smollin Schwartz 16

16
 Identifying Future Opportunities:
The Product/Market Expansion Grid

making more sales to current

customers without chaning your original offering modified or new products to current markets
products/services

identifying and developing new starting up or buying businesses

markets for existing products beyond its current products or markets

Smollin Schwartz 17

17

Downsizing
• Reduce business portfolio by eliminating products or
SBUs that are not profitable or that no longer fit the
company’s overall strategy

• Reasons for downsizing:

– Rapid growth of the company
– Lack of experience in a market
– Change in market environment
– Decline of a particular product

Smollin Schwartz 19

19
 Marketing’s Role in Strategic
Planning &
The Marketing Plan

Smollin Schwartz 20

20

Marketing’s Role in Strategic Planning

• Provides guiding philosophy

• Provides inputs to strategic planners

• Works with other departments to ensure all are customer-

focused.

• Conducts analysis of
the “current state”

• Develops strategies
for reaching SBU
objectives

• Develops a marketing
plan, based on the
Smollinstrategic
Schwartz plan. 21

21
 Contents of a Marketing Plan
Section Purpose
Executive summary
1. ______________ Brief summary of main goals and
______________ recommendations

Current marketing
2. ________ situation
_______ Market description and review of the
______________ product, competition, and distribution
PLANNING

Threats
3. ___________ & Analysis of external forces that influence
opportunities analysis
_______________ your plan
______________

objectives
4. ____________ & Marketing objectives and key issues
______________
issues

Smollin Schwartz 22

22

_________
SWOT Analysis

Smollin Schwartz 23

23
 Marketing Strategy & Action Program

Smollin Schwartz 27

27

Contents of a Marketing Plan, cont.

Section Purpose
marketing
5. ________ Outlines broad marketing logic and specifics of target
_______
strategy markets, positioning and marketing mix (4Ps)

action programsSpells out how marketing strategies will be turned into

6. ________
_______ specific action programs

budgets
7. ________ Details marketing budget and projected P&L statement

8. ________
controls Outlines the metrics that will be used to monitor
MEASURMT

progress, review results, identify and fix problems

Smollin Schwartz 28

28
 Controls = Accountability
Marketing Financial Controls
Sales $100,000,000
Gross Profit $40,000,000
Marketing Expenses $3,000,000
Net Income (Profit) $12,000,000

• Profit Margin = Net Income (Profit) / Sales

$12,000,000 / $100,000,000 = 12%
• Net Marketing Contribution
NMC = Sales – COGS – Marketing Expenses
Gross Profit
Smollin Schwartz $40,000,000 - $3,000,000 = $37,000,000

29

Controls = Accountability
Marketing Financial Controls, cont.
Sales $100,000,000
Gross Profit $40,000,000
Marketing Expenses $3,000,000
Net Income (Profit) $12,000,000

• Marketing Return on Sales

Marketing ROS = NMC / Sales
$37,000,000 / $100,000,000 = 37%
• Marketing Return on Investment
Marketing ROI = NMC / Marketing Expenses

Smollin Schwartz $37,000,000 / $3,000,000 = 1233.33%

30
 Controls = Accountability
Marketing Financial Controls, cont.

Customer-Centered Measures
• Market Share
• Share of Customer (Share of Wallet)
• Customer Acquisition Targets
• Customer LTV
• Customer Equity

Smollin Schwartz

31

Controls = Accountability

Non-Financial Marketing Controls

Communications Measures
• Brand Awareness
• Likeability, Brand Preference
• Consideration
• Intention to Purchase

Smollin Schwartz

32
 Thanks

Stacy Smollin Schwartz

sschwartz@business.rutgers.edu
tw @smollinschwartz

Smollin Schwartz 33

33