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Marketing Management
Chapter 2 – Developing Marketing
Strategies and Plans

Dr. Manoochehr Najmi

Graduate School of Management and Economics
Sharif University of Technology
1399-00 (2)
 How does marketing affect customer value?
 How is strategic planning carried out at
different levels of the organization?
 What does a marketing plan include?

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 The Marketing Process
Create value for customers and build Capture value from
customer relationships customers in return

Understand the Design a Construct an Build profitable Capture value

marketplace and customer-driven integrated relationships from customers
customer needs marketing marketing and create to create profits
and wants strategy program that customer and customer
delivers superior delight equity
value

Research Select customers Product and Customer Create satisfied

customers and to serve: market service design: relationship loyal customers
the marketplace segmentation build strong management:
and targeting brands build strong
relationships Capture
Mange Decide on a Pricing: with chosen customer
marketing value Create real value customers lifetime value
information and proposition:
customer data differentiation Distribution:
and positioning Manage demand Partner Increase share
and supply relationship of market share
chains management: and share of
build strong customer
Promotion: relationships
Communicate with marketing
the value partners
proposition

Harness marketing Manage global Ensure ethical and

technology markets social responsibility 3
Phases of Value Creation and
Delivery

Choosing the value: STP

Providing the value: Product features,

Prices, and Distribution

Communicating the value:

Communication tools

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 What is the Value Chain?
The value chain is a tool for identifying ways to
create more customer value because every firm is
a synthesis of primary and support activities
performed to design, produce, market, deliver, and
support its product.

Infrastructure
Human Resource Management
Technology Development
Procurement
Operations
Inbound Outbound Marketing Services
Logistics Logistics and Sales

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 Core Business Processes
► Market-sensing process: all the activities in gathering and
acting upon information about the market.

► New-offering realization process: all the activities in

researching, developing, and launching new high-quality offerings quickly and
within budget.

► Customer acquisition process: all the activities in defining

target markets and prospecting for new customers.

► Customer relationship management process: all the

activities in building deeper understanding, relationships, and offerings to
individual customers.

► Fulfillment management process: all the activities in

receiving and approving orders, shipping the goods on time, and collecting
payment.

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 Characteristics of
Core Competencies
 A source of competitive advantage
 Applications in a wide variety of markets
 Difficult to imitate

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Figure 2.1 The Strategic Planning,
Implementation, and
Control Processes

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 Hierarchy of strategies

•Portfolio Management
•Synergy (Parenting)

Competitive
Advantage

Productivity

Sources: De wit and Myer, 2010;

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What is a Marketing Plan?

A marketing plan is the central instrument for

directing and coordinating the marketing effort.

It operates at a strategic and tactical level.

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 Levels of a Marketing Plan

 Strategic  Tactical
 Target marketing  Product features
decisions  Promotion
 Value proposition  Pricing
 Analysis of  Sales channels
marketing  Service
opportunities
 Corporate Headquarters’
Planning Activities

 Define the corporate mission

 Establish divisions/strategic business units
(SBUs)
 Assign resources to each SBU
 Assess growth opportunities

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 Characteristics of SBUs

 It is a single business or collection of

related businesses
 It has its own set of competitors
 It has a leader responsible for strategic
planning and profitability

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 Assign resources to each SBU

Analyzing the Current Business Portfolio

The Boston Group Approach
Growth share matrix is a portfolio planning method that evaluates a company’s
strategic business units in terms of their market growth rate and relative share
Relative Market Share
High Low
Market Growth Rate
High

Question Marks
Stars
?
• High growth & share • High growth, low share
• Profit potential • Build into Stars or phase out
• May need heavy • Require cash to hold
investment to grow market share
Cash Cows Dogs

• Low growth, high share • Low growth & share

Low

• Established, successful • Low profit potential

SBU’s
• Produce cash 14
Figure 2.3 The Business Unit
Strategic Planning Process

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 Mission: Product Orientation vs.
Market Orientation
Company Product Market
Missouri-Pacific We run a railroad We are a people-
Railroad and-goods mover

Steelcase We sell office We furnish the work

furniture experience

Standard Oil We sell gasoline We supply energy

Columbia Pictures We make movies We entertain

people

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 Market Opportunity Analysis
(MOA) (1)
 Can the benefits involved in the opportunity
be articulated convincingly to a defined
target market?
 Can the target market be located and
reached with cost-effective media and trade
channels?
 Does the company possess or have access
to the critical capabilities and resources
needed to deliver the customer benefits?

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 Market Opportunity Analysis
(MOA) (2)
 Can the company deliver the benefits better
than any actual or potential competitors?
 Will the financial rate of return meet or exceed
the company’s required threshold for
investment?

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Figure 2.4
Opportunity and Threat Matrices

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Porter’s Generic Strategies

Overall cost leadership

Differentiation

Focus

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 Marketing Plan

 A marketing plan is a written document that

summarizes what the marketer has learned
about the marketplace and indicates how the
firm plans to reach its marketing objectives. It
contains tactical guidelines for the marketing
programs and financial allocations over the
planning period.

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Marketing Plan Contents

 Executive summary
 Table of contents
 Situation analysis
 Marketing strategy
 Marketing tactics
 Financial projections
 Implementation controls
See page 83: Pegasus Sports International
See Appendix A1: Sonic Marketing Plan and Exercises

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 Digital marketing

• Digital Marketing is the use of digital or social

channels to promote a brand or reach consumers. This
kind of marketing can be executed within social
media, search engine, internet, mobile devices and
other channels.

• Digital Marketing Archives - American Marketing

Association
 Digital Marketing Plan

®
Figure 8.7 SOSTAC
®
– a generic framework for digital marketing planning
Source: PR Smith’s SOSTAC Planning Model (1990).
Evaluating a Marketing Plan

 Is the plan simple?

 Is the plan specific?
 Is the plan realistic?
 Is the plan complete?

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 For Review

 How does marketing affect customer value?

 How is strategic planning carried out at
different levels of the organization?
 What does a marketing plan include?

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