Strategic Marketing

1. Imperatives for Market-Driven Strategy

2. Markets and Competitive Space
3. Strategic Market Segmentation
4. Strategic Customer Relationship Management
5. Capabilities for Learning about Customers and Markets
6. Market Targeting and Strategic Positioning
7. Strategic Relationships
8. Innovation and New Product Strategy
9. Strategic Brand Management
10. Value Chain Strategy
11. Pricing Strategy
12. Promotion, Advertising and Sales Promotion Strategies
13. Sales Force, Internet, and Direct Marketing Strategies
14. Designing Market-Driven Organizations
15. Marketing Strategy Implementation And Control
 Chapter 15

Marketing Strategy
Implementation
and Control
Marketing strategy implementation and control
The Implementation Challenge
• How well marketing strategy is
implemented and managed on
a continuing basis is the
ultimate test of market
targeting and positioning
decisions.
• Putting strategy into action!
• 70% of new strategic initiatives
fail at the implementation
stage
Marketing strategy implementation and control

• FIAT (in Italy) 2007 - strategic turnaround in

auto industry
• Debts, losses, market share falling, reputation
for low quality, diversification
• Recovery strategy of radical restructuring,
dismantling management and bureaucracy
• Marketing, operations and R&D overhauled-
small car focus
• Range of strategic relationships established
 The strategic marketing planning process

The Strategic Marketing Plan indicates marketing

objectives and the strategy and tactics for
accomplishing the objectives, guides implementation
and control.
• The marketing plan guides implementation
• Contents of the marketing plan
• Managing the planning process
 Strategy and planning relationships

MARKETING STRATEGY

Annual Annual Annual

Marketing Marketing Marketing
Planning Planning Planning

Implementation Implementation
Control and Evaluation Control and Evaluation
Revision Revision
MARKETING PLAN OUTLINE
 MARKETING PLAN OUTLINE

I. Strategic Situation Summary

Summarize the key points from your situation analysis
(market analysis, segments, industry/competition) in order to
recount the major events and provide information to better
understand the strategies outlined in the marketing plan.
 MARKETING PLAN OUTLINE
II. Market-Targets and Objectives

1.The market targets may be defined demographically (key characteristics only),

geographically, or in social/economic terms.
2.Each market target should have needs and wants that differ to some degree
from other targets.
3.These differences may be with respect to types of products purchased, use
situation, frequency of purchase, and other variations that indicate a need to
alter the positioning strategy to fit the needs and wants of each target.
4.An objective is a quantified goal identifying what is expected when. It specifies
the end results expected. The objectives should be written for each target
market.
5.Objectives should also be included for the following program components: (1)
product, (2) price, (3) distribution, (4) promotion (sales force, advertising, sales
promotion, and public relations), and (5) technical services.
 MARKETING PLAN OUTLINE

III. Positioning Statements

Write statements that describe how you want each market

target to perceive each product relative to competition. State the
core concept used to position the product (brand) in the eyes and
mind of the targeted buyer. The positioning statement should
describe: (1) What criteria or benefits the customer considers when
buying a product along with the level of importance, (2) What we
offer that differentiates our product from competition, and (3) The
limitations of competitive products.
IV. Market Mix Strategy for Each Market Target

A. Product Strategy
Identify how each product fits the market target. Other issues
that may be addressed would be new product suggestions,
adjustments in the mix of existing products, and product
deletion candidates.

B. Price Strategy
The overall pricing strategy (I.e., competitive, premium-priced,
etc.) should be identified along with a cost/benefit analysis if
applicable. Identify what role you want price to play, i.e.,
increase share, maintenance, etc.
IV. Market Mix Strategy for Each Market Target

C. Distribution Strategy
Describe specific distribution strategies for each market
target. Issues to be addressed are intensity of distribution
(market coverage), how distribution will be accomplished, and
assistance provided to distributors. The role of the sales force
in distribution strategy should also be considered.
D. Promotion Strategy
Promotion strategy is used to initiate and maintain a flow of
communication between the company and the market target.
To assist in developing the communications program, the
attributes or benefits of our product should be identified for
each market target. How our product differs from competition
(competitive advantage) should be listed. The sales force’s
responsibilities in fulfilling the market plan must be integrated
into the promotion strategy. Strategies should be listed for
(1) personal selling, (2) advertising, (3) sales promotion, and
(4) public relations.
 E. Marketing Research

Describe the market research problem and the kind of

information needed. Include a statement which addresses
why this information is needed. The specific market
research strategies can be written once the above two
steps have been followed.

V. Coordination with Other Business Functions

Indicate other departments/functions that have

responsibilities for implementing the marketing plan.

VI. Sales Forecasts and Budgets

VII. Contingency Plans

Indicate how your plans should be modified if events

should occur that are different from those assumed
in the plan.
 Dimensions of Planning Process
TOOLS:
Techniques
Analytical Procedures
Process Systems
Dimension Planning Models

Marketing Managerial
Behavioral perceptions
Planning Process
Process
Process Participation Consistency
Dimension
Strategic
assumptions

Organizational Structure
Process Information
Dimension Culture
Implementing the strategic marketing plan (1)

• Implementation process
– Structural issues: marketing functions, control systems, & policy
guidelines.
– Behavioral issues: managers’ skills in bargaining, resource allocation,
and developing informal organizational arrangements.
• Building implementation effectiveness
– Organizational design
– Incentives
– Communications
– Internal marketing
• Comprehensive approach to improving implementation
 A good Implementation process (Elements of an
Action Plan)

Activities to
be implemented

Responsibility for IMPLEMENTATION How implementation

implementation PROCESS will be done

Time and location

of implementation
 Improving Implementation

Skilled
Implementers

Effective Organizational
Communications Improving Design
Implementation

Internal
Incentives
Marketing
 Skilful Implementers

• The ability to understand how others feel

and good bargaining skills.
• The strength to be tough and fair in putting
people and resources where they will be
most effective.
• Effectiveness in focusing on the critical
aspects of performance in managing
marketing activities.
• The ability to create a necessary informal
organization or network to match each
problem which they are confronted.
 Internal Marketing
Strategy

Plan

Internal External
Marketing Marketing
Program Program

Internal Marketing External Marketing

Program:
Targeted at key groups in the
company, alliance partner
companies, and other
influencers
Program
Targeted at key
customers, segments
and niches, and other
external influencers
The importance of internal marketing
 Comprehensive Approach to Improving
Implementation
Financial
Measures

BALANCED
Learning
SCORECARD Customer
and Innovation
MANAGEMENT Measures
Measures
CONTROL
SYSTEM

Internal Business
Process Measures
Balanced Scorecard (Kaplan and Norton)
Implementing the strategic marketing plan (2)
• Internal strategy-organization fit
– Organizational stretch (the degree to which structures,
capabilities, systems, processes, and resource allocation may
require adjustment to deliver the strategy).
– The role of external organization
 Strategic marketing evaluation and control (1)
• Customer relationship management (customer
acquisition, defection rates, customer tenure, customer value,
inactive consumers, cross-selling).
• Overview of control and evaluation activities
– Find new opportunities/avoid threats
– Keep performance in line with expectations
– Solve specific problems
Evaluation Activities
Find New
Opportunities
or Avoid Threats

Solve Keep
Specific Performance
Problems on Target
Evaluation and control

Conduct
strategic
marketing
audit

Select performance
criteria and
choose relevant
marketing metrics

Obtain and
analyze
information

Assess
performance and
take necessary
action
 Strategic marketing evaluation and control (2)

• The strategic marketing audit

– Results provide basis for selecting performance
criteria to assess actual performance against
plans
– See Exhibit 15.6
Strategic Marketing Audit (See Exhibit 15.6)

 Corporate Mission and Objectives

 Business Composition and Strategies

 Marketing Strategy (for each planning unit)

 Marketing Program Activities

 Implementation and Management

 Marketing performance assessment (1)
• The importance of marketing metrics
• The use of marketing metrics
• Types of marketing metrics
• Selecting relevant metrics
• Designing a management dashboard
 Marketing metrics (A)

• Marketing metrics focusing on operations

– Competitive and customer metrics
– Profitability metrics
– Product and portfolio metrics
– Customer profitability metrics
– Sales and channel metrics
– Pricing metrics
– Promotion metrics
– Advertising, media and web metrics
– Financial metrics
 Marketing metrics (B)
• Brand equity metrics
– Familiarity
– Penetration
– What they think about the brand
– What they feel
– Loyalty
– Availability
• Innovation metrics
– Strategy
– Culture
– Outcomes
 Marketing metrics (C)
• Internal market metrics
– Awareness of corporate goals
– Perceived caliber of employer
– Relative employee satisfaction
– Commitment to corporate goals
– Employee retention
– Perceived resource adequacy
– Appetite for learning
– Freedom to fail
– Customer-brand empathy
• Internal process metrics
– E.g., internal communications
 Marketing performance assessment (2)

• Interpreting performance measurement results

– Opportunities and performance gaps
• Problem/opportunity definition
• Interpreting information
– Determining normal and abnormal
variability
– Deciding what actions to take
 Selecting Marketing Metrics

Guidelines:
• Measuring performance relative to
strategy
• Tracking performance relative to
competitors
• Tracking performance on customers
• Tracking performance over time
• Modelling performance (to test the
impact of different elements of
strategy being changed).
 Metrics
• Metrics should be chosen to reflect strategic priorities and to
link marketing investments with profits.
• Payless ShoeSource: Spending Efficiency and Effectiveness
(ROI by advertising medium, Advertising to Sales Spending
ratios) and Business Building (customer traffic, ratio of loyal to
new customers).
• Cadbury: Performance against Strategic Milestone, Market
Share, Advertising Spending, Brand and Advertising
Awareness, Average Purchases, and Percent of Total Volume
from New Products.
 Shared Metrics
THE POWER OF PARTNERSHIP
• Useful technique for encouraging co-ownership:
Creating alignment through shared performance
goals.
• Vertical alignment measures: CMO’s performance
is measured against company-wide financial
results, such as operating earnings or sales
growth.
• Horizontal alignment measures: CMO’s metrics
are closely tied to the responsibilities they share
with other C-suite colleagues.
 Horizontal Alignment Measures:
CMO and CIO (@Regal Entertainment Group)

CMO: high priority on speed and creativity, taking risks to

achieve aggressive goals.
CIO: often risk-averse, prizing stability, security, and accuracy.

SHARED METRICS:
• The percentage of tickets sold on the company’s app or website
• The percentage of customers visiting Regal’s self-service kiosks
• The speed of ticket lines in theaters
• Customers’ website experience (load times)
• The re-launch of the Regal Crown Club loyalty program
 Choices of Metrics: Shell’s case
Case: Shell’s large expenditure on sponsoring Ferrari in Formula One motor racing
needs financial justification.
Evaluation:
• Comparing attitudes toward Shell brand of those who were aware of the Ferrari
link, and those who were not.
• Examining change in purchasing behavior associated with shifts in attitudes
toward the brand.
• Commissioning an independent evaluation of brand value, including branding,
sales, price premium, and advertising effects.
• Making country-by-country comparisons-different Shell companies had
merchandized the sponsorship locally to varying extents, so if the sponsorship
was profitable, those who promoted it more should have obtained more benefit.
• Surveying manager opinion and their ratings of the impact of the sponsorship on
return on investment
A Roadmap to Brand Research : Marketing Dashboard

ATTITUDINAL
Awareness
Brand Portrait Attitude
Purchase intention
Purchase Intention Factors controlled,
such as competitive
set & income

BEHAVIORAL
BRAND Actual Purchase
RESEARCH Product adoption, trial,
and referral
Factors controlled, such as
economic condition &
market sentiments

Brand BUSINESS VALUE

Modeling Shareholder Value:
Cash Flows
Share Price

Building and Sustaining Brand Equity © Ike Janita Dewi

Global issues for planning, implementation
and control
• Global marketing planning
– Additional complexity
– Simplifying assumptions
– Limited information availability
– Accommodate international strategy variability
• Implementation globally
– Importance of relationships between domestic and
international executives
• Performance measurement and control globally
– International markets may require different metrics