Chapter 2: Developing Marketing Strategies and a Marketing Plan

Class example- Virgin Atlantic

- Part of virgin mobile
- He does marketing for cheap even though he’s rich
- Want to get point across that they had more legroom than other airlines- after individuals
exited a plan people run to bathroom after
- Strategically put urinals up high – leg room and timing was smart
- Wanted to get across that they take care of your luggage better- when ppl got luggage
off carousel, they released packs of eggs and not one was cracked- and gave people the
eggs for free which customers liked

The Goal is Clear: Win!

- Is innovation important?- yes and must take place at every level of an organization
- Creative sustainability
- Strategies and plans must be precise
- Brand disruption?- must ensure your brand is at the top of mind in consumers

What is a Marketing Strategy?

- Marketing strategy identifies:
- a firm’s target market (s)
- a related marketing mix –the four P’s and
- the bases upon which the firm plans to build a sustainable competitive advantage
- Virgin’s competitive advantage is their edgy campaign

Sustainable Competitive Advantage

- Strong brand
- Technology
- Strong customer base
- Loyal customers
- Ex. nike

Developing Customer Value

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- The values on the outside come secondary to the customer needs

Customer Excellence
- Retain loyal customers
- Provide excellent customer service
- Ex. disney- good garbage pickup system, employees are around to go above and
beyond (e.g. help people who are lost)

Canadian Tire Class Example

- Hire lots of teenagers – good energy, good knowledge
- Prof picked to shop there instead of others- she told her exactly what aisle it was in and
how to find the product there

Operational Excellence
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- Ex. amazon fast delivery

Product Excellence Class Example

- UFC winner george
- He would win 1 million dollars every time he won a fight
- He says it was barely covering his costs
- He tried to get endorsed but was turned down by many because the sport is violent
- A company in Quebec did research on how people would precieve him- brands were
viewing him as bad but they found that many men thought he was a good athlete and
many girls thought he was good looking
- They posed him as a good athlete (for the men) and shirtless (for the girls)
- Over 14 months got 13 endorsements

Locational Excellence

-
Multiple Sources of Advantage
- Multiple approaches:
- Customer value
- Customer service
- Customer relations
- Great prices!
- Good service=good value

Class Example
- West Jet
- West jet Christmas mini miracles- free flights and toy donations
- Emotional and powerful
- Blue outfits and blue santa hats are branding west jet

Developing a Marketing Plan

Step 1: Define the Business Mission and Objectives

- Tim Hortons states: Our guiding mission is to deliver superior quality products and
services for our customers and communities through leadership, innovation and
partnerships. Our vision is to be the quality leader in everything we do.

Another Example: Non-Profit

 - The Heart and Stroke Foundation mission: is to improve the health of Canadians by
preventing and reducing disability and death from heart disease and stroke through
research, health promotion, and advocacy.

Step 2: Conduct a SWOT Analysis

-
- This isn’t good enough
- This isn’t good enough for full marks- she uploaded a good example on mls
- Have to explain WHY it is a strength or a weakness
- Start with a research fact and explain HOW it is a threat or opportunity

Step 3: Identify and Evaluate Opportunities by Using STP

-
An Example: Hertz Market Segmentation

Step 4: Implement Marketing Mix and Allocate Resources

Product and Value Creation

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Price and Value for Money

- Exchange: product = money
- Customer perception of value
- Price is only a part of value!

Place and Delivery

- Product must be readily accessible
- When and where the customer wants it

Promotion and Value Communication

- Marketers communicate the value of their offering, or the value proposition, to their
customers through a variety of media, including:
- Television
- Radio
- Magazines
- Sales force
- Internet

Step 5: Evaluate Performance by Using Marketing Metrics

 - Outcomes need to be evaluated. Metrics are used to explain why things happened and
to project the future. In particular:
- Who Is Accountable for Performance?

Portfolio Analysis: Boston Consulting Group Matrix

Star
- Classifies Products into four simple categories:
- Star – products in markets experiencing high growth rates with a high or increasing
share of the market
- Potential for high revenue growth
- Examples? Mineral Water
- Stars are good but sometimes trendy
- Make us money and attention but need to managed properly cause if not they could
become a dog

Cash Cow
 - High market share
- Low growth markets – maturity stage of PLC
- Low cost support
- High cash revenue – positive cash flows
- You want all your brands to aspire too
- Last a long time
- Support other brands- ex. Tide
- You want many cash cows- tide has over 35 lines of tide

Dog
- Products in a low growth market
- Have low or declining market share (decline stage of PLC)
- Associated with negative cash flow
- May require large sums of money to support
- Ex. Jenny Craig Food
- Could’ve been successful but now losing money

Question Mark
- Products having a low market share in a high growth market
- Need money spent to develop them
- May produce negative cash flow
- Potential for the future
- 2-Minute Noodles?
- Take off quickly but when they take off nobody maintains loyalty to it
- When other companies see it they try to recreate a better version of it – that’s why it is
questionable
- Ex. New product of roasting marshmallows so it doesn’t fall off- Canadian tire gave them
lots of money for the first year then Canadian tire recreated it better

Class Example- Gravity Blanket

- People claim it is heavy and helps you sleep better
- Trending now

Class Example- Smart Fitness Mirror

- Built in fitness routines into the mirror
- Use app to get access to all different workouts
- Get progress report at end of workout
- $495 and 30$ a month for subscription

Growth Strategies
- Companies use this to evaluate success
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Market Penetration
- Existing marketing mix
- Existing customers

Marketing Penetration Strategy

- Employs the current marketing mix and focuses the firm's efforts on current customers.
- Encourages current customers to patronize the firm more often or buy more
merchandise
- Requires greater marketing efforts such as; increased advertising, additional sales and
promotion, or intensified distribution efforts in geographic areas in which the product or
service is already sold
- You want it because the product is successful, but you are putting more money into
advertising

Market Development Strategy

- Existing mix offering
- New market segments (domestic, international) not currently being served
- Example: dove- now have products for males and children and expanding into the senior
market

Product Development
- New product/service
 - Current target market
- Product development, extensions, new innovative products
- Example: tide – still going after same target market but they come up with many new
products and product line extensions

Diversification
- New product/service
- New market segment not currently being served
- Ex. President of blackberry tried to buy a nhl team and bring it to Hamilton – in business
of cellphones and tried to get into sports (it failed)