Chapter 3

Learning objectives
 Distinguish between strategic and market planning in terms of
objectives and processes;
 Analyze the elements of macro and micro-environment and their
influence to marketing planning;
 Define marketing research, its importance to a business
enterprise and identify steps in marketing research;
 Describe the consumer and business markets;
 Differentiate the buying behavior and decision making of
individual/household customer versus the business customer;
 Identify and segment market for a product or service;
 Select the appropriate target market segment and its positioning.
Strategic Marketing vs Tactical
Marketing

 Strategicmarketing planning - deals with

the direction of your business growth in
relation to your competitive and the brand
image necessary to advance your market
position.
 A general
plan of action aligned with the
company's vision and goals.
Strategic Marketing Planning
 Your strategy is the road map that helps you to achieve our goals and
comprises a financial entailing your marketing budget as well as a
conceptual plan

Strategic Planning Process

 Perform SWOT Analysis
 Do industry and market research
 Plan strategies around only one element of the findings
 Settle on the brand identity message you wish to convey
 Use your analysis to determine where you can fill gaps and take
advantage of the weaknesses of your competition.
Tactical marketing planning

 Itconsist of planning the actual activities

that improve your competitive position and
convey your brand image.
 Refers to actions a company undertakes in
order to execute an organization's strategy.
Steps in describing marketing
tactics in the marketing plan:
 Prepare an action plan
 Namethe necessary resources and
monitor the allocated budget
 Identifyhow the success of the
tactics will be measured.
Strategic marketing
is the idea.
Tactical Marketing
is the action.
Domino's Pizza
Strategic Marketing: To achieve global presence, Domino's
innovated its menu.
Tactical Marketing: To implement this marketing strategy,
Domino's employs the following tactics:
a. The pizza has bread, sauce, and cheese in all four
countries except China.
b. Half of the toppings are standard all over the world,
while the other half customized depending on the
country in question. In Asia, the toppings are usually
seafood and fish. In India, it is curry.
Nike
Strategic Marketing: To increase global presence, Nike
formed long-term partnership with international companies
for sponsorship.
Tactical Marketing: Nike participated in championship and
tournaments with partners where Nike was exposed to a
global audience.
Strategic Marketing: Another marketing strategy is the
creation of NikeID platform which caters to international
markets.
Tactical Marketing: Creation and delivery of customized
products depending on the preference of the customers.
McDonald's
Strategic Marketing: To reach its goal of increased
global presence, McDonald's marketing strategy is to
adapt its menu by including a local flavor specific to
each country where McDonald's is located.
Tactical Marketing: Introduction of menu items
exclusive to certain countries, such as Teriyaki Burger
in Japan, Pineapple Pie in Thailand, Traditional
Brazilian cheese bread in Brazil, McToast in Croatia,
and Crispy Veggie Burger in Finland.
Coca-Cola
Strategic Marketing: Coca-cola's marketing strategy is to focus on
charitable programs that impact small communities around the world.
Tactical marketing: The following are marketing tactics used
a. Coca-cola put up The Coca-cola foundation which currently benefits
around 300 organizations in more than 70 countries worldwide.
b. Another tactic is to prioritize three areas which have impacted
millions of lives for Women, Water, and Well-being.
C. Coca-cola supports worthwhile projects such as strengthening arts and
cultures in the US, as well as HIV/AIDS awareness and prevention
programs in Latin America and Africa.
Marketing Environment
Is the sum of all internal and
external forces that affect the way
a firm operates, particularly its
ability to build and maintain
relationships with its target
customers.
Internal Environment
The internal environment of the business includes all the
forces and factors inside the organization which affect its
marketing operations. These components can be grouped
under the Five Ms of the business, which are:
Men
Money
Machinery
Materials
Markets
External Environment
The external environment constitutes factors and
forces which are external to the business and on
which the marketer has little or no control. The
external environment is of two types:

Micro Environment
The micro component of the external environment is
also known as the task environment. It comprises of
external forces and factors that are directly related
to the business.
FIVE COMPONENTS OF MICRO
ENVIRONMENT
 Organization - consist of owners, investors, and employees who are all
considered members of the organization.
 Suppliers - provides resources the organization needs to produce goods and
services.
 Customers - people who are willing and able to buy organizations products
and services.
 Marketing intermediaries - are entities that assist in the distribution and
selling of goods to customers such as distributors, wholesalers, retailers,
and brokers.
 Competitors - are rivals of the firm that offer similar goods or services as
the organization.
Macro Environment
The macro component of the marketing environment is
also known as the broad environment. These factors
encompass of much larger all-encompassing influences
from the global society. The six major forces are:

 Demographic environment is made up of the people

who constitute the market. It is characterized as the
factual investigation and segregation of the population
according to their size, density, location, age, gender,
race, and occupation
 Political environment refer to group of people or parties
which may influence the stability of a country and affect
the production, distribution, promotion, and selling of
goods and services.
 Ecological environment refers to all the processes or
activities necessary to protect the environment while
maintaining efficiency of business operations.
 Economic environment constitutes factors which
influence customers’ purchasing power and spending
patterns. These factors include the GDP, GNP, interest
rates, inflation, income distribution, government
funding and subsidies, and other major economic
variables
 Technological environment refers to
the developments in technology that
may affect consumers, businesses,
and the society at large.
 Sociocultural environment refers to
the belief, practices, norms, and
traditions that may affect business
operations.
Marketing research
 is the process of collecting and analyzing data to
address a specific marketing problem. It is also
used to decide whether to launch a product,
introduce a variant of a product, reinvent the
branding, and so on.
 The role of marketing research is not to make
marketing decisions but rather help reduce risks
in decision-making.
The Marketing Research Process
 State the objectives - defining the objectives aids
the researcher in designing a market research
process that suits the company's capacity and
needs.
 Determine the research methodology. The
research methodology may be adapted to the
manner of gathering information through;
1. Primary research
2. Secondary research
The methodology may also be based on the type of
information to be gathered
1. Quantitative research
2. Qualitative research

The methodology may also depend on the type of

study.
1. Exploratory research
2. Descriptive research
3. Casual research
 Gather data
 Interpret the results
 Present the results
Consumer Market
 is a system composed of all Individuals or consumers who
purchase goods and services for personal consumption or
use.

Consumer Purchase Decision

Process
 Recognizing a need
 Searching for information about a product/service
 Evaluating the different products available
 Making a final purchase decision
 Making an after-purchase evaluation
Factors Influencing
Consumer Behavior
 Cultural factors refers to an individuals belief,
traditions, norms, and values learned from the family or
other institutions in his or her society.
 Social factors refer to the sum of the costumers social
functions and interactions with the member of his/her
group.
• Reference groups
• Social Role
• Social Status
 Personal factors are exclusive to the individual
alone, such as age, lifestyle, occupation, civil
status, religion, economic status and personality.
 Psychological factors are those which are
associated with the human mind and behaviour.
• Motivation
• Perception
• Learning
• Beliefs and attitudes
Types of Consumer
Buying Behaviour
 Variety-seekingbehaviour
 Habitual buying behaviour
 Dissonance-reducing behaviour
 Complex buying behaviour
Business Markets
 are composed of firms and business organizations that
purchase semi-processed goods and raw materials either
for the operations or for reselling.

Characteristics of Business Markets

 The demand in business markets
 The complexity of buying decisions
 The involvement of professional purchasing agents
Business Buying Decision
Process
 Recognition of a need
 Determining product specifications
 Listing possible suppliers
 Selection of suppliers
 Periodic review
Types of Business Buying
Situations
Straightrebuy
Modified rebuy
New buy
Participants in the Business
Buying Process
 Users - they directly utilize products and services from suppliers.
 Influencers - helps in further defining the specifications and
features needed for a product or service.
 Buyers - are usually professional purchasing agents of the firms
who negotiate with the suppliers as part of the buying process.
 Deciders - are people in the business organization who have the
authority to make or approve of decisions.
 Gatekeepers - they control the flow of information from the
business markets to the suppliers.
 MARKET
SEGMENTATION,
TARGETING, AND
POSITIONING
is a group of people to whom a
company intends to sell its
products and services.
Identifying the target market
helps the company maximize its
marketing resources and efforts
to attract and retain a loyal
group of customers.
 Market Segmentation - refers
to the process of dividing
consumer markets into
smaller groups of consumers.
Marketers aim to focus on
specific needs of these
consumer groups, and make
sure that their products and
brands respond to these
needs.
Variables in Market Segmentation
The variables in market segmentation are divided
into four categories:
 Demographic Variables
1. Age
2. Life cycle stages
3. Gender
4. Income
5. Religion,race, and nationality
 Geographic Variables
1. Climate
2. Population size
 Psychographic Variables
1. Lifestyle patterns
2. Hobbies and interest
3. Opinions and beliefs
4. Personality
 Behavioristic Variables
1. Loyalty
2. Specific occasions
3. Benefits
 Market Targeting - is the second stage wherein
companies and firms actually select their target
markets based on a number of factors, including
the resources of the company or firm, the
strategies of the competitors, and the
profitability expected from this specific market.
Types of Market Targeting
Strategies
Undifferentiated marketing
Differentiated Marketing
Concentrated Marketing
 Market positioning - also
referred to as product
positioning where,
companies and firms
develops ways to promote
and position their brands
effectively to their selected
segments or target markets.
Types of Market Positioning
Strategies
 Features-based positioning
 Use-based positioning
 User-based positioning
 Head-on competitive positioning
 Lifestyle positioning