Kotler 18e Accessible PowerPoint 02

Principles of Marketing
Eighteenth Edition
Chapter 2
Company and Marketing
Strategy Partnering to Build
Customer Engagement, Value,
and Relationships
Copyright © 2021, 2018, 2016 Pearson Education, Inc. All Rights Reserved
Learning Objectives
2.1 Explain company-wide strategic planning and its four steps.
2.2 Discuss how to design business portfolios and develop
growth strategies.
2.3 Explain marketing’s role in strategic planning and how
marketing works with its partners to create and deliver
customer value.
2.4 Describe the elements of a customer value-driven marketing
strategy and mix and the forces that influence them.
2.5 List the marketing management functions, including the
elements of a marketing plan, and discuss the importance of
measuring and managing marketing return on investment.
NIKE: Building Customer Value through
Brand Engagement and Community
“Nike’s outstanding success results from much more than just making good sports gear.
The iconic company’s strategy is to build deep engagement and a sense of community with
and between the Nike brand and its customer.”
Learning Objective 1
Explain company-wide strategic planning and its four steps.
Company-Wide Strategic Planning
(1 of 5)
Strategic planning is the process of developing and

maintaining a strategic fit between the organization’s goals
and capabilities, and its changing marketing opportunities.
(2 of 5)
Figure 2.1 Steps in Strategic Planning
(3 of 5)
The mission statement is the

organization’s purpose; what it
wants to accomplish in the
larger environment.
CV S Health’s overall mission
is to be a “pharmacy
innovation company,” one that
is “helping people on their way
to better health.” Its marketing
strategies and programs must
support this mission.
(4 of 5)
Product- versus Market-Oriented Business Definitions

Company Product-Oriented Definition Market-Oriented
Definition
Starbucks We sell coffee and snacks. We sell “The Starbucks
Experience,” one that
enriches people’s lives in
one moment, one human
being, one extraordinary
cup of coffee at a time.
Panera We sell fast-casual food in our We give customers “Food

restaurants. as it should be”: food that
tastes good; food that feels
good; food that does good
things for them and the
world around them.
(5 of 5)
Setting Company Objectives and Goals

• Business objectives
– Build profitable customer relationships
– Invest in research
– Improve profits
• Marketing objectives
– Increase market share
– Create local partnerships
– Increase promotion
Real Marketing 2.1: Airbnb ’s Mission
Belong Anywhere–Don’t Stay There. Live There.
Discuss how to design business portfolios and develop
growth strategies.
Designing The Business Portfolio
(1 of 8)
The business portfolio is the

collection of businesses and
products that make up the company.
Portfolio analysis is a major
activity in strategic planning
whereby management evaluates the
products and businesses that make
up the company.
Mars Inc. is not only the world’s

number-one candy maker; it is also
a world-leading pet nutrition and
health-care company.
(2 of 8)
Strategic business units can be a

• Company division
• Product line within a division
• Single product or brand
(3 of 8)
Analyzing The Current Business Portfolio
• Identify strategic business units (SBU s)

• Assess the attractiveness of its various SBU s
• Decide how much support each SB U deserves
(4 of 8)
Figure 2.2 The B C G Growth-Share Matrix
(5 of 8)
Problems with Matrix Approaches

• Difficulty in defining SBU s and
measuring market share and
growth
• Time consuming
• Expensive
• Focus on current businesses, not
future planning
Over the years, ESP N has grown to

become a huge and complex brand
portfolio consisting of more than 50
different entities.
(6 of 8)
Figure 2.3 The Product/Market Expansion Grid
(7 of 8)
Developing Strategies for Growth and Downsizing
Strategies for growth: To maintain its incredible growth,
Starbucks has brewed up an ambitious, multipronged growth
strategy.
(8 of 8)
Developing Strategies for Growth and Downsizing

Downsizing is when a company must prune, harvest, or
divest businesses that are unprofitable or that no longer fit
the strategy.
Explain marketing’s role in strategic planning and how
marketing works with its partners to create and deliver
customer value.
Planning Marketing: Partnering to
Build Customer Relationships (1 of 3)
Partnering with Other Company Departments
Value chain is a series of departments that carry out value
creating activities to design, produce, market, deliver, and
support a firm’s products.
Partnering with Other Company Departments
The value chain: Walmart’s ability to help you “Save Money. Live
Better.” by offering the right products at lower prices depends on
the contributions of people in all of the company’s departments.
Partnering with Others in the Marketing System
Value delivery network is made up of the company,

suppliers, distributors, and ultimately customers who partner
with each other to improve performance of the entire system.
Describe the elements of a customer value-driven marketing
strategy and mix and the forces that influence them.
Marketing Strategy and the Marketing
Mix (1 of 7)
Mix (2 of 7)
Customer Value-Driven Marketing Strategy
Marketing strategy is the marketing logic by which the
company hopes to create customer value and achieve
profitable customer relationships.
Mix (3 of 7)
Market segmentation is the division of a market into distinct
groups of buyers who have different needs, characteristics,
or behaviors and who might require separate products or
marketing mixes.
Market segment is a group of consumers who respond in a
similar way to a given set of marketing efforts.
Mix (4 of 7)
Market targeting is the process of evaluating each market
segment’s attractiveness and selecting one or more
segments to enter.
Market positioning is the arranging for a product to occupy
a clear, distinctive, and desirable place relative to competing
products in the minds of target consumers.
Differentiation begins the positioning process.
Mix (5 of 7)
Customer Value-Driven Marketing
Strategy
Positioning is arranging for a
product to occupy a clear,
distinctive, and desirable place
relative to competing products from
competing brands and give them
the greatest advantage in their
target markets.
Positioning: Sharable urban
transportation company Lime
positions itself as “Smart mobility for
the modern world.” Such simple
statements form the backbone of a
brand’s marketing strategy.
Mix (6 of 7)
Developing an Integrated Marketing Mix
Marketing mix is the set of controllable, tactical marketing
tools—product, price, place, and promotion—that the firm
blends to produce the response it wants in the target market.
Mix (7 of 7)
Figure 2.5 The Four P s of the Marketing Mix
List the marketing management functions, including the
elements of a marketing plan, and discuss the importance of
measuring and managing marketing return on investment.
Managing the Marketing Effort (1 of 4)
Figure 2.6 Manging Marketing: Analysis, Planning,
Implementation, and Control
Figure 2.7 S W O T Analysis: Strengths (S), Weaknesses
(W), Opportunities (O), and Threats (T)
Market Planning—Parts of a Marketing Plan
• Executive summary
• Marketing situation
• Threats and opportunities
• Objectives and issues
• Marketing strategy
• Action programs
• Budgets
• Controls
Marketing Implementation
• Turning marketing strategies and plans into marketing
actions to accomplish strategic marketing objectives
• Addresses who, where, when, and how
Measuring and Managing Return on
Marketing Investment (1 of 2)
Return on Marketing Investment (Marketing RO I)
• Net return from a marketing investment divided by the
costs of the marketing investment
• Measurement of the profits generated by investments in
marketing activities
Measuring and Managing Return on
Marketing Investment (2 of 2)
Figure 2.8 Marketing Return on Investment
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Principles of Marketing

Strategic planning is the process of developing and

Figure 2.1 Steps in Strategic Planning

The mission statement is the

Product- versus Market-Oriented Business Definitions

Panera We sell fast-casual food in our We give customers “Food

Setting Company Objectives and Goals

The business portfolio is the

Mars Inc. is not only the world’s

Strategic business units can be a

Analyzing The Current Business Portfolio

• Identify strategic business units (SBU s)

Figure 2.2 The B C G Growth-Share Matrix

Problems with Matrix Approaches

Over the years, ESP N has grown to

Figure 2.3 The Product/Market Expansion Grid

Developing Strategies for Growth and Downsizing

Value delivery network is made up of the company,

This work is protected by United States copyright laws and

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