Principles of Marketing, Arab World Edition PDF

Principles of Marketing, Arab World Edition Philip Kotler, Gary Armstrong, Anwar Habib, Ahmed Tolba Presentation prepared by Annelie Moukaddem Baalbaki CHAPTER TWO Company a...

Principles of Marketing, Arab World Edition Philip Kotler, Gary Armstrong, Anwar Habib, Ahmed Tolba Presentation prepared by Annelie Moukaddem Baalbaki CHAPTER TWO Company and Marketing Strategy: Partnering to Build Customer Relationships Sarah Alrabeeah Ch 1 Ch 2 -1 -1 Copyright Copyright © 2011 © 2011 Pearson Pearson Education Education  Company and Marketing Strategy Topic Outline 2.1 Companywide Strategic Planning: Defining Marketing’s Role 2.2 Designing the Business Portfolio 2.3 Planning Marketing: Partnering to Build Customer Relationships 2.4 Marketing Strategy and the Marketing Mix 2.5 Managing the Marketing Effort 2.6 Measuring and Managing Return on Marketing Investment Ch 2 -2 Copyright © 2011 Pearson Education  Companywide Strategic Planning Strategic Planning Strategic planning is the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities. Ch 2 -3 Copyright © 2011 Pearson Education  Companywide Strategic Planning Steps in Strategic Planning Ch 2 -4 Copyright © 2011 Pearson Education  Companywide Strategic Planning Defining a Market-Oriented Mission The mission statement is the organization’s purpose; what it wants to accomplish in the larger environment. “To give people the power to share and make the world more open and connected.” A market-oriented mission statement defines the business in terms of satisfying basic customer needs. Ch 2 -5 Copyright © 2011 Pearson Education A mission statement should: Not be myopic in product terms Meaningful and specific Motivating Emphasize the company’s strengths Contain specific workable guidelines Not be stated as making sales or profits  Companywide Strategic Planning Ch 2 -6 Copyright © 2011 Pearson Education  Companywide Strategic Planning Setting Company Objectives and Goals The company needs to turn its mission statement into detailed supporting objectives for each level of management. Ch 2 -7 Copyright © 2011 Pearson Education  Designing the Business Portfolio 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. Ch 2 -8 Copyright © 2011 Pearson Education  Designing The Business Portfolio Analyzing the Current Business Portfolio Strategic business unit (SBU) is a unit of the company that has a separate mission, and objectives that can be planned separately from other company businesses. Can be: a company division, a product line within a division, or sometimes a single product or brand). Ch 2 -9 Copyright © 2011 Pearson Education  Companywide Strategic Planning: The Boston Consulting Group Approach requiring heavy investment Demand requiring less investment a lot of cash Little of cash Ch 2 -11 Copyright © 2011 Pearson Education  Companywide Strategic Planning: The Boston Consulting Group Approach Stars are high-growth, high-share businesses or products requiring heavy investment to finance rapid growth. They will eventually turn into cash cows. Cash cows are low-growth, high-share businesses or products that are established and successful SBUs requiring less investment to maintain market share. Question marks are low-share business units in high-growth markets requiring a lot of cash to hold their share. Dogs are low-growth, low-share businesses and products that may generate enough cash to maintain themselves but do not promise to be large sources of cash. Ch 2 -11 Copyright © 2011 Pearson Education  Companywide Strategic Planning Problems with Matrix Approaches Difficulty in defining Strategic business unit (SBUs) and measuring market share and growth Time consuming Expensive Focus on current businesses, not future planning Ch 2 -12 Copyright © 2011 Pearson Education  Companywide Strategic Planning Developing Strategies for Growth and Downsizing Product/market expansion grid is a portfolio planning tool for identifying company growth opportunities through: market penetration market development product development diversification Ch 2 -13 Copyright © 2011 Pearson Education  Companywide Strategic Planning *Developing Strategies for Growth and Downsizing Market penetration is a growth strategy increasing sales to current market segments without changing the product. Same product Market development is a growth strategy identifying and developing new market segments for current products. Same product Ch 2 -14 Copyright © 2011 Pearson Education  Companywide Strategic Planning Developing Strategies for Growth and Downsizing Product development is a growth strategy through offering new or modified products to current market segments. Same Market Diversification is a growth strategy through starting up or acquiring businesses outside the company’s current products and markets. Ch 2 -15 Copyright © 2011 Pearson Education  Companywide Strategic Planning Developing Strategies for Growth and Downsizing Downsizing is the reducing of the business portfolio by eliminating products or business units that are not profitable or that no longer fit the company’s overall strategy. Ch 2 -16 Copyright © 2011 Pearson Education Planning Marketing: Partnering to Build Customer Relationships 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. Ch 2 -17 Copyright © 2011 Pearson Education  Planning Marketing Partnering with Others in the Marketing System Value delivery network is made up of the company, suppliers, distributors, and ultimately the customers who partner with each other to improve performance of the entire system. Ch 2 -18 Copyright © 2011 Pearson Education  Marketing Strategy and the Marketing Mix Which costumer? How will we create value for them? Ch 2 -19 Copyright © 2011 Pearson Education  Marketing Strategy and the Marketing Mix Customer-Driven Marketing Strategy Market segmentation is the division of a market into distinct groups of buyers who have distinct needs, characteristics, or behavior 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. Ch 2 -20 Copyright © 2011 Pearson Education  Marketing Strategy and the Marketing Mix Customer-Driven Marketing Strategy 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 the target consumer. Ch 2 -21 Copyright © 2011 Pearson Education  Marketing Strategy and the Marketing Mix 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. Ch 2 -22 Copyright © 2011 Pearson Education  Marketing Strategy and the Marketing Mix Developing an Integrated Marketing Mix Ch 2 -23 Copyright © 2011 Pearson Education  Managing the Marketing Effort Ch 2 -24 Copyright © 2011 Pearson Education  Managing the Marketing Effort Ch 2 -25 Copyright © 2011 Pearson Education  Managing the Marketing Effort Marketing Implementation Implementing is the process that turns marketing plans into marketing actions to accomplish strategic marketing objectives. Successful implementation depends on how well the company blends its people, organizational structure, its decision and reward system, and company culture into a cohesive action plan that supports its strategies. Ch 2 -27 Copyright © 2011 Pearson Education  Managing the Marketing Effort Marketing Control Marketing Control is the process of measuring and evaluating the results of marketing strategies and plans and taking corrective action to ensure that objectives are achieved. Operating control Strategic control Ch 2 -29 Copyright © 2011 Pearson Education  Measuring and Managing Return on Marketing Investment Return on Marketing Investment (Marketing ROI) Return on marketing investment (Marketing ROI) is the net return from a marketing investment divided by the costs of the marketing investment. Return cost Marketing ROI provides a measurement of the profits generated by investments in marketing activities. Ch 2 -30 Copyright © 2011 Pearson Education  From Book  Read reviewing objectives and key terms (pg. 60-61)  Focus on Ethics- (pg. 62).  Focus on Technology (pg. 61-62). Ch 1 -31 Copyright © 2011 Pearson Education