Strategic Planning Process ASCO

• Strategic Planning involves developing an overall company

strategy for long-run survival and growth.

• This process involves:

– Defining a Mission: Statement of an organization’s purpose;
should be market oriented.
– Setting Company Objectives: Supporting goals and
objectives to guide the entire company.
– Designing a Business Portfolio: Collection of businesses and
products that make up the company.
– Planning Functional Strategies: Detailed planning for each
department designed to accomplish strategic objectives.
Mission
Mission Statements
2-3
Statements
2-3

ASCO

Market
Market
Oriented
Oriented

Motivating
Motivating Realistic
Realistic
Characteristics
Characteristics
of
of Good
Good Mission
Mission
Statements
Statements
Distinctive
Distinctive Specific
Specific
Competencies
Competencies
Fit
Fit Market
Market
Environment
Environment

 Copyright 1998 Prentice Hall

 Designing the Business
ASCO

• The best portfolio is the Portfolio

one that best fits the company’s
strengths and weaknesses to the opportunities in the
environment.

• The company must:

– analyze its current business portfolio or Strategic Business
Units (SBU’s)
– decide which SBU’s should receive more, less, or no
investment
– develop growth strategies for adding new products or
businesses to the portfolio
 Analyzing Current SBU’s:
ASCO
Boston Consulting Group Approach

Relative Market Share

High Low
Stars Question Marks
Market Growth Rate
High

• High growth & share • High growth, low share

• Profit potential • Build into Stars/ phase out
• May need heavy • Requires 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
•Produces cash
 Developing Growth Strategies ASCO

Product/ Market Expansion Grid

Existing New
Products Products
Existing 1. Market 3. Product
Markets Penetration Development

New 2. Market
4. Diversification
Markets Development
 Product/ Market Expansion Grid ASCO

• Market Penetration:
Penetration increase sales to present customers with
current products. How? Cut prices, increase advertising, get
products into more stores.

• Market Development:
Development develop new markets with current
products. How? Identify new demographic or geographic
markets.

• Product Development:
Development offering modified or new products to
current customers. How? New styles, flavors, colors, or
modified products.

• Diversification:
Diversification new products for new markets. How? Start up
or buy new businesses.
 Marketing’s Role in
Strategic Planning ASCO

• Process of Selecting Target Consumers

– Market Segmentation:
Segmentation determining distinct groups of buyers
(segments) with different needs.

– Market Targeting:
Targeting evaluating and selecting which target segments
to enter.

– Market Positioning:
Positioning products distinctive and desirable place in
the minds of target segments compared to competing products.
• Marketing Strategies for Competitive Advantage
– Market-Leader
– Market Challenger
– Market-Follower
– Market-Nicher
 The Marketing Process ASCO

Demographic- Technological-
Economic Marketing Natural
Environment Intermediaries Environment

ys ng

M lan
ar n
al eti

P
is

ke in
An ark
Product

tin g
M

g
Place Target Price
Suppliers Publics
Consumers

n
ti o
en ing
M Con

Promotion
ar tr

ta
em et
ke ol

pl rk
tin

Im Ma
g

Political- Social-
Legal Competitors Cultural
Environment Environment
 Marketing Mix- The Four P’s
Price ASCO
Product
“Goods-and-service” Amount of money
combination that a that consumers
company offers a have to pay to obtain
target market the product

Target
Customers

Intended
Positioning

Activities that Company activities

persuade target that make the
customers to buy product available
the product
Promotion Place
 Managing the Marketing Effort ASCO

Marketing Analysis of Company’s Situation

Marketing Planning Marketing Control

Implementation Measure
Develop Marketing Results
Strategies to Turn Marketing Plans
Achieve Marketing into Evaluate
Objectives Action Plans Results
to Achieve
Develop Marketing
Marketing Objectives Take
Corrective
Plans & Budget Action
 Elements of a Marketing Plan ASCO

Executive Summary
Current Marketing Situation
Threats and Opportunities
Objectives and Issues
Marketing Strategy
Action Programs
Budgets
Controls
 Marketing Implementation
ASCO
Marketing Strategy

Decision
and
Reward Human
Organizational
Resources
Structure

Action Climate and

Programs Culture

Implementation

Marketing Performance
Marketing Control ASCO

Set Marketing Goals

Measure
Performance

Evaluate
Performance

Take Corrective
Action
 Marketing Audits ASCO

Environment

Function Strategy
Types
of Marketing
Audits
Productivity Organization

Systems
 Relationship Marketing ASCO

• Relationship marketing has the aim to

building mutually satisfying long term
relationship with key parties in order to
earn and retain their business.

• Relationship marketing builds strong

economic, technical and social ties among
the parties

15
 RM VS. TRANSACTIONAL ASCO

MARKETING
Relationship marketing uses methods to
develop long term relationship with customer
in order to retain and develop a healthy
relationship with their customer.

Transactional marketing is focusing all of its

marketing efforts on attracting customer for
one off sale

16
 CUSTOMER ASCO

RELATIONSHIP MARKETING
• CRM is the values and strategies of
relationship marketing with particular
emphasis on customer relationship turned
into practical application

17
 CUSTOMER ASCO

LIFETIME VALUE
• Losing an existing customer means losing
the entire revenue stream that customer
represents not just that single encounter or
sale

18
 LOYALITY ASCO

AND SATISFACTION
• Highly satisfied customer are
• Less price sensitive
• More likely to talk favourably about
product
• More likely to refer products to others
• Remain loyal for long

19
 5 LEVELS OF ASCO

RELATIONSHIP MARKETING
• Basic marketing
• Reactive marketing
• Accountable marketing
• Proactive marketing
• Partnership marketing

20
 ASCO

• Basic Marketing – The salesperson sells

to the final customers. This is also known
as direct sales.
• Reactive Marketing – The sales person
sells the product and encourages the
customer to call for any comments or
enquiries.

21
 ASCO

• Accountable Marketing – The sales person

calls the customers to ensure whether the
product is working as per satisfaction and
if there is any problem in the product.
Furthermore he also asks the customer for
any suggestions / feedback to improve the
service / product. Thus he is taking
responsibility for the sale.

22
 ASCO

• Proactive marketing – The company works

continuously with its large customers to help
improve performance.
This is especially seen in financial companies .
However at the same time, these financial
companies have to take care of their customers as
well.
Thus they take regular feedback from their large
customers thereby developing their products
accordingly.
23
 ASCO

• Partnership Marketing – The company works

continuously with its large customers to
improve its performance.

24
 10 CRITICAL ASCO

PLAYERS IN RM
1. Supplier
2. Distributors
3. End users
4. Employees
5. Financial firms
6. Government
7. Media
8. Allies
9. Competitors
10.General public 25
 WHY RM IS ASCO

IMPORTANT ?
• It costs five times as much to attract a new
customer as it does to keep a current one
satisfied
• It is claimed that a 5% improvement in
customer retention can cause an increase
in profitability b/w 25% and 85% depending
on the industry
• Like wise it is easier to deliver additional
products and services to an existing
customer than to a first time ―buyer. 26
ASCO

27