PM SG 11 Q1 0102 PDF - Marketing Principles and Strategies

Unit 1: Marketing Principles and Strategies Lesson 1.2 Goals in Marketing Contents Introduction 2 Learning Objectives 3 Quick Look 3 Learn the Basics 5...

Unit 1: Marketing Principles and Strategies Lesson 1.2 Goals in Marketing Contents Introduction 2 Learning Objectives 3 Quick Look 3 Learn the Basics 5 Developing Marketing Goals 5 Mission Statement 5 Vision Statement 7 Goals and Objectives 9 Key Performance Indicators (KPIs) 12 Common Marketing Goals 14 Acquire New Customers 15 Retain Customers 15 Upsell and Cross-Sell 16 Increase Customer Satisfaction 16 Launch New Products 16 Improve Product Position 17 Case Study 17 Keep in Mind 18 Try This 19 Practice Your Skills 21 Challenge Yourself 23 Bibliography 24 Unit 1: Marketing Principles and Strategies Lesson 1.2 Goals in Marketing Introduction What are your goals for your future? Why did you choose the Accountancy, Business, and Management (ABM) strand for your Senior High School education? Is taking this strand a step toward achieving your goals? What other actions do you need to take? In life, there are several critical decisions that you need to make. Having clear goals would help you weigh the options and opportunities available for you. 1.2. Goals in Marketing 1 Unit 1: Marketing Principles and Strategies Goals are sources of vision, direction, and clarity. They guide your periodic decisions and actions, such as what to do this week, month, quarter, or year. These time-bound activities that progress toward achieving your goals and attaining success are essential elements of an effective plan. Setting goals and objectives is essential for individuals, more so for businesses and companies. Business leaders make sure that every action contributes to the company’s achievement. They use tools and mechanisms to describe their position and measure their progress in attaining success. This lesson will teach you the importance of marketing goals, objectives, and other success indicators.. Learning Objectives DepEd Competency In this lesson, you should be able to do the Discuss the goals of marketing following: (ABM_PM11-Ia-b-3). Identify the components of marketing goals and objectives. Plan marketing goals, objectives, and key performance indicators. Discuss the importance of establishing marketing goals. Quick Look What’s Your Goal? Setting up goals is practical for individuals and organizations because it directs attention to their desired outcomes. For example, most students would aim to complete their studies, land a stable job, and contribute to the developments in their chosen field. However, how could they do that? What tools do they need to achieve these goals? What actions would 1.2. Goals in Marketing 2 Unit 1: Marketing Principles and Strategies contribute to its realization? What are the do’s and don'ts? These questions also apply to businesses, their departments, and their workforce. For business organizations, goals and objectives are foundations of success. Goals are vital tools in establishing an organization’s destination, direction, and standards. Well-organized goals allow companies to determine their short-term and long-term targets. Meanwhile, objectives are organized as periodic milestones toward achieving the set goals. A set of specific, realistic, and measurable objectives could be an effective tool in monitoring and analyzing the company’s performance. Goal and objective setting coupled with monitoring and evaluation could boost a company's productivity and performance. Questions to Ponder 1. What vital functions do goals and objectives provide to organizations? ________________________________________________________________________________________ ________________________________________________________________________________________ ________________________________________________________________________________________ 2. What do you think would happen if a business organization does not have well-organized goals and specific objectives? ________________________________________________________________________________________ ________________________________________________________________________________________ ________________________________________________________________________________________ 3. Suppose you are part of an organization. Why would it be important for you to learn its goals and objectives? ________________________________________________________________________________________ ________________________________________________________________________________________ ________________________________________________________________________________________ 1.2. Goals in Marketing 3 Unit 1: Marketing Principles and Strategies Learn the Basics Business goals establish the organization's desired outcome, direction, and standards. Thus, goals also represent the company's overall purpose and mission. These goals communicate what the whole organization strives for, and every leader, department, and employee should contribute toward their achievement. Since marketing is part of business processes, marketing goals and objectives relate to the company's overall mission. Businesses want to succeed in a particular market; thus, they establish marketing goals to reach a specific target demographic, communicate the product's or service's value, and build strong customer relationships. Marketers determine the courses of action—a plan or strategy—to achieve these goals and contribute to the company's overall success. Essential Question What is the benefit of transforming overall goals into attainable objectives? Developing Marketing Goals Effective marketing requires a well-thought-out, well-informed marketing plan; however, establishing marketing goals and objectives is the beginning of a successful marketing plan. The inception of a marketing plan should consist of the following: mission statement, vision statement, core values, goals and objectives, and key performance indicators (KPIs). Mission Statement A mission statement explains the company’s purpose and primary goals. An excellent mission statement is clear, meaningful, and inspiring. It is stated in a brief but impactful manner and is written in the present tense. Furthermore, a company should communicate its mission statement to every stakeholder1. Stakeholder (noun) —a party that has an interest in a company that can either affect or be affected by the business. 1 1.2. Goals in Marketing 4 Unit 1: Marketing Principles and Strategies Some examples of mission statements are the following: "To motivate and encourage every athlete in the world." "We aim to be the most customer-focused organization on the planet." "By winning with a purpose, we strive to become the global leader in handy meals and beverages." Creating a mission statement consists of the following steps: 1. Develop a unique selling proposition (USP) to establish the company's "winning idea" against its competitors. The USP attracts customers and distinguishes a company from other companies that offer similar products or services. 2. Clarify the company's goals and list the most critical success indicators. 3. Combine the "winning idea" and the company's goal to develop a clear statement that conveys the company's purpose, outcomes, and metrics. Closer Look Creating a Mission Statement A firm that produces farm products determined that its winning idea is to "deliver farm freshness." Furthermore, it established two critical success indicators: product quality and customer satisfaction. Incorporating the winning idea and success criteria, the firm established the following mission statement: "To be the best produce shop in Main Town by supplying the highest-quality, freshest agricultural items straight from the farm to have happy customers." 1.2. Goals in Marketing 5 Unit 1: Marketing Principles and Strategies Vision Statement A vision statement expresses what the business aspires to become in the world. It articulates the outcome that it envisions through the achievement of its mission statement. Vision statements are ideal long-term goals and are evergreen; meaning, even if the organization's strategy changes, the vision generally remains constant. Some examples of vision statements are the following: "Providing the finest in cosmetics innovation in terms of quality, efficacy, and safety to all women and men globally." "We will assist individuals in living longer, healthier, and happier lives." "Assisting content producers all around the world in reaching a worldwide audience." Creating a vision statement consists of the following steps: 1. After defining the mission statement, determine the business’s human worth or purpose. Organizations must consider these questions: "How does your business make a difference in people's lives?" and "What can your business do to make the world a better place?" 2. Determine the values that matter most to the organization, its customers, and other stakeholders. Companies must refine these values to select what they possess or should possess. Examples of company values include excellence, integrity, teamwork, originality, equality, honesty, freedom, service, and strength. 3. Combine the ideas on the business’s human worth and the company’s values to form a statement that could inspire individuals within and outside the organization. The message should be timeless and should explain why the people in the company do what they do. 1.2. Goals in Marketing 6 Unit 1: Marketing Principles and Strategies Closer Look Creating Vision Statements After thoroughly studying the company's organization and culture, the owner identifies three common values: freshness, tastiness, and "localness" of the food. Here is the vision statement that expresses both the company and the human values: "By bringing the freshest, tastiest, and most nutritious local products from local farmers to Main Town families’ tables, we inspire Main Town families to live happier and healthier lives." Check Your Progress Compare and contrast mission and vision statements. _________________________________________________________________________________ _________________________________________________________________________________ _________________________________________________________________________________ Core Values Company values or core values are a collection of guiding principles and essential beliefs that empower individuals to operate as a team toward a common business goal. Having a defined set of company values guarantees that all employees are guided in their work toward the company's goals. Core values are guiding principles that help shape the company's mission and support its vision. They also influence the company’s culture and have an impact on its business strategy. In an organization, core values contribute to developing a purpose, improving team cohesiveness, and instilling a feeling of dedication in the workplace. 1.2. Goals in Marketing 7 Unit 1: Marketing Principles and Strategies Company values do not have to be one of a kind. Instead, they reflect what the company wants to see in itself and how the employees see the company. A company that lacks core values is not a company. It would lack the tenacity to develop outstanding teams, provide exceptional customer service, and drive innovation. Goals and Objectives Some organizations use the terms goals and objectives interchangeably when discussing their plans and strategies. To utilize these tools effectively and avoid misunderstanding, companies should know the essential nuances between the two. A goal is a broad aim established to start the business planning process, while an objective is a specific milestone reached to achieve a goal (Root 2016). While goals provide an overall vision, objectives concentrate on specific, attainable achievements. Goals can be the starting dialogue when determining the needed actions to assist business growth. They are also written down and utilized to build the business strategy framework. The actual deliverables2 that bring goals to life are called objectives. When businesses monitor progress toward meeting an objective, it can also track their progress toward achieving a broader goal. Table 1. Characteristics of Goals and Objectives Goal Objective It consists of general ideas and broader It consists of specific statements with limited aims. scope. It establishes a general direction or It determines actions that are more specific vision. than goals. It is challenging to measure. Its progress is measurable and manageable. Deliverable (Noun) - It's a term to define the quantifiable items or services that must be delivered at the end of a project. 2 1.2. Goals in Marketing 8 Unit 1: Marketing Principles and Strategies It uses abstract concepts and is not It uses attainable milestones associated with a necessarily time-bound. timetable or schedule. It has a long-term vision. It consists of short-term or long-term targets. It is the final product of all the fulfilled It is organized to achieve the goals objectives. progressively. Below are some examples of goals: I want to be acknowledged as a corporate strategy specialist. I will devote myself to my professional growth and discover how to boost sales. By September 15, I intend to form a special-purpose team dedicated to increasing employee engagement. Below are some examples of objectives: In the coming year, I'll be speaking at five conferences. I'll read one book about sales strategy every month. I'll be working with a coach to practice my networking skills by the end of the month. Check Your Progress Compare and contrast goals and objectives. _________________________________________________________________________________ _________________________________________________________________________________ _________________________________________________________________________________ SMART Marketing Objectives By recalling the previous section, goals have broader aims than objectives. Objectives organize and operationalize the achievement of goals; therefore, objectives have to be specific, measurable, achievable, relevant, and time-bound. Organizations typically use the SMART criteria to determine and design their objectives. 1.2. Goals in Marketing 9 Unit 1: Marketing Principles and Strategies Figure 1. The mnemonic SMART refers to the principle of developing objectives. 1. Specific: Objectives are clear and detailed, leaving no room for confusion or misinterpretation. Organizations consider the five Ws (who, what, when, where, and why) in developing their objectives. 2. Measurable: Objectives specify the metrics to assess the organization’s performance. Organizations should be able to measure their progress through the use of units, numbers, and figures. 3. Achievable: Objectives set targets that the team could accomplish. Organizations consider its resources, opportunities, and capabilities to determine attainable milestones. 4. Relevant: Objectives align with the individual and organizational goals. Organizations design worthwhile activities that directly address their current needs and advance their progress toward achieving their aims. 5. Time-bound: Objectives are set to be accomplished in a given date, timeframe, or deadline. The time element expresses the long-term and short-term objectives as well as the priorities at any given time. Through this, organizations can periodically assess their performance and progress. 1.2. Goals in Marketing 10 Unit 1: Marketing Principles and Strategies Closer Look Applying the SMART Criteria The company that supplies and sells farm produce in the Main Town aims to expand its business operations in the next five years. How can the company transform this goal into SMART objectives? Here are some examples: 1. To open three additional branches throughout the country—one in Luzon, one in Visayas, and one in Mindanao 2. To increase company revenue by 15% annually 3. To increase production capacity by 25% in the Laguna production facility 4. To increase staffing by 20% and assign an equal amount of people to each of the branches Key Performance Indicators (KPIs) Key Performance Indicators (KPIs) are quantifiable measures that organizations use to describe their performance and track their progress against a specific objective or target. While objectives define the desired long-term and short-term outcomes, the KPIs demonstrate how effectively these outcomes have been achieved. The function of the KPIs is similar to those meters found in a car’s dashboard. The dashboard symbols inform the driver how much fuel is left in the tank and how fast or slow the vehicle is going. The meters provide real-time measurements of the car's overall health. Similar to these dashboard meters, KPIs inform the organization’s leaders and members of the direction and speed of their achievements. Evaluation through the use of KPIs can assist businesses in concluding whether or not they are on the right track of achieving their goals and, if not, where they should focus their efforts. Regardless of what it measures, a KPI's aim is to promote organizational health. 1.2. Goals in Marketing 11 Unit 1: Marketing Principles and Strategies Effective planning usually sets five to seven KPIs to oversee and track. Here are some of the elements that comprise a structured KPI: measurement: Quantifiable outcome expected target: Period when to achieve the objective data source: Means to get the data to be analyzed reporting frequency: Period when to monitor progress Closer Look Creating Key Performance Indicators Consider this business objective: “To increase sales revenue by 15% for the next three months.” From the stated objective, there are several possible KPIs: KPI 1: Increase website traffic to 1,000 new customers by the end of the month. Measurement: 1000 new customers Target: By the end of three months Data source: Insights from company's website Reporting frequency: Monthly KPI 2: Increase email subscriptions by 500 new customers every month. Measurement: 500 new customers Target: Every month Data source: Insights dashboard from the company's email management system Reporting frequency: Monthly 1.2. Goals in Marketing 12 Unit 1: Marketing Principles and Strategies Common Marketing Goals Company mission, vision, goals, and objectives are guiding stars for every leader, department, and employee as they make decisions and take action regularly. Organizations use KPIs to measure the performance and progress toward achieving the predetermined objectives. The marketing department operates in the same manner. Identifying and defining marketing goals are the starting points in planning and strategizing marketing activities. As mentioned in the previous lesson, the overall goal of marketing is to establish and maintain profitable customer relationships. This broad aim is broken down into specific marketing goals: acquiring new customers, retaining customers, upselling and cross-selling, increasing customer satisfaction, launching a new product, and improving product position. These goals provide an anchor to every marketing decision and activity. Figure 2. Marketing goals assist in establishing and maintaining customer relationships. 1.2. Goals in Marketing 13 Unit 1: Marketing Principles and Strategies Acquire New Customers Customer acquisition is the process of drawing in new customers or clients. This process aims to create a systematic, sustainable acquisition strategy that evolves with recent trends and changes. In acquiring new customers, companies follow a road map called the buyer's journey—the process in which buyers become aware, consider, and decide to buy a product or avail a service. Nowadays, companies use tools to track how far along customers are in the buyer's journey, and these help businesses maximize their efforts toward bringing in the right customers. Figure 3. Understanding the buyer’s journey is important in acquiring new customers. Retain Customers Customer retention refers to the activities and efforts made by companies and businesses to increase customer loyalty. Customer-retention programs aim to assist businesses in retaining as many customers as possible, generally through customer-loyalty and brand-loyalty activities. 1.2. Goals in Marketing 14 Unit 1: Marketing Principles and Strategies Membership cards and buyer club rewards are two of the most common forms of customer-retention strategies. For instance, a famous coffee shop awards frequent buyers a special gift if they purchase coffee for a specified number of times. Upsell and Cross-Sell Also known as suggestive selling, upselling is the activity of persuading customers to buy an upgraded or more expensive version of a product or service. This sales tactic maximizes profit and provides better customer experience. You may have observed this while getting a haircut. Hairdressers would often suggest additional services to improve your hair-salon visit. Cross-selling is a sales approach that encourages customers to spend more by recommending a product related to the one they are already purchasing. Cross-selling tactics can be present even while the customer is still choosing an item. You may notice e-commerce platforms having a “Recommended for You” section or ”Add These to Your Cart” prompts. Increase Customer Satisfaction Bear in mind that the key to increased customer satisfaction is consistency in providing positive customer value. Although customers perceive value differently, the product or service performance should consistently exceed their expectations. This way, customer value is positive and high. If brands deliver consistent customer satisfaction over time, they effectively achieve the second goal: customer retention and loyalty. Some strategies to increase customer satisfaction include providing new products and solutions with better performance and enhanced features. This strategy is especially useful if customers’ feedback shows that they are willing to pay higher prices for a better experience. Launch New Products A product launch is a coordinated effort to bring a product to market and announce it to the public. The marketing plan outlines the messaging and marketing strategy for effectively convincing customers to adopt the new product. 1.2. Goals in Marketing 15 Unit 1: Marketing Principles and Strategies You may have observed product launches in social-media platforms where the usual content contains announcements leading to the launch. Or you may see some videos featuring tech moguls talking about their latest smartphone or car model. This type of strategy creates hype and leads audiences to stay tuned. By the time the product is launched into the market, many customers are already interested in purchasing the product. Improve Product Position When you're meeting someone for the first time, you need to make the right first impression. The same idea applies when businesses position their product in the market. Product positioning is the strategy of deciding and presenting how the market sees, thinks, or feels about the company’s product compared to the competing ones. Product positioning affects all aspects of branding and influences how businesses present and share their product and service to the public. It also affects how the people in the entire organization communicate the brand. How do you feel when you visit your favorite fast-food or clothing store? Do these stores emit a particular character? What you see, feel, and think about the experience could be how brands wanted to position themselves in the market. Case Study A Technology Company’s Mission and Vision A multinational technology corporation's corporate mission and vision statements emphasize innovation for worldwide social progress through technical goods. The firm's mission statement suggests authority, quality, and leadership in its respective industry, while its vision statement supports an inspiration-focused strategic goal that positions the firm as a global influence. 1.2. Goals in Marketing 16 Unit 1: Marketing Principles and Strategies By integrating its corporate vision and mission statements, the tech giant emerged as an industry leader and affected the global community. Samsung’s Mission Statement & Vision Statement (An Analysis) Victoria Martin, “Samsung’s Mission Statement & Vision Statement (An Analysis),” Panmore Institute, March 18, 2019, http://panmore.com/samsung-corporate-vision-statement-corpo rate-mission-statement-analysis, last accessed on November 7, 2021. Keep in Mind Establishing goals is one of the first steps in developing a good marketing strategy. It lays down the actions that the company must take to succeed in the market. The inception of a marketing plan includes the creation of a mission statement, a vision statement, core values, and marketing goals and objectives, complemented by key performance indicators (KPIs) to help monitor the business’s progress in achieving the predetermined goals. The overall goal of marketing is to establish and maintain profitable customer relationships. Thus, common marketing goals include acquiring new customers, retaining customers, upselling and cross-selling, increasing customer satisfaction, launching new products, and improving product position. These marketing goals guide the everyday decisions and actions of the company, marketing department, and employees. 1.2. Goals in Marketing 17 Unit 1: Marketing Principles and Strategies Try This A. Modified True or False. Write true if the statement is correct. If false, replace the underlined word or phrase with the correct answer. ________________ 1. Goals express broad aims, while objectives focus on specific and actual accomplishments. ________________ 2. If a brand delivers consistent customer acquisition, it earns the customer’s loyalty. ________________ 3. Objectives are principles and beliefs that guide employees in working together to achieve the company’s goal. ________________ 4. SMART means specific, measurable, attainable, realistic, and time-bound. ________________ 5. Mission statements are quantifiable performance measures used to define a company’s success elements and track its progress toward achieving its objectives. 1.2. Goals in Marketing 18 Unit 1: Marketing Principles and Strategies ________________ 6. Vision statements define the purpose and major goals of an organization. ________________ 7. Providing sign-up bonuses where new customers are rewarded with discounts is an example of customer-retention strategy. ________________ 8. Analyzing the market offering of competitors is a necessary step in achieving the goal of improving market position. ________________ 9. A structured key performance indicator (KPI) consists of measurement, target, data source, and the frequency of report. ________________ 10. A mission statement consists of the winning idea and a progress criteria. B. Matching Type. Match the words in column A with the words in column B. Column A Column B __________ 1. the activity of persuading customers into a. acquire buying a related or upgraded product customers __________ 2. the strategy of providing solutions and b. retain enhancing performance for better customers customer experience __________ 3. the process of drawing in new clients c. upsell and cross-sell __________ 4. the strategy of deciding how customers d. increase should see and feel about a brand customer compared to the competitors satisfaction __________ 5. the objective of providing rewards and e. improve loyalty programs market position 1.2. Goals in Marketing 19 Unit 1: Marketing Principles and Strategies Practice Your Skills Read the case and answer the following questions. Anna Nilla started a cookie-selling business this year. She bakes her products straight from her kitchen. At first, Anna relied on referrals and word of mouth from her satisfied clients to get new customers. She sells a box of cookies for ₱150.00 and receives an average of 40 orders per month, reaching a total sales of ₱6,000.00. Now that she has gained a considerable customer base and experience operating the business, Anna aims to have a leading online store for cookies and pastries by helping people send their thoughts to their loved ones. Since Anna does not have a physical store that customers could visit, she plans to utilize social media to receive orders from old and new customers. Aside from serving as an online store, her business’s social-media account will be used to reach out to her target audience and promote her products. Through these strategies, Anna aims to increase her sales to at least ₱20,100.00 a month. 1. What are Anna's business goals and objectives? __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ 2. What key performance indicator (KPI) could help Anna measure her progress and success in achieving her objective? Use the table provided to develop a KPI. 1.2. Goals in Marketing 20 Unit 1: Marketing Principles and Strategies KPI: Measurement: Target: Data source: Reporting frequency: 3. What strategy did Anna implement to acquire and retain customers? __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ 4. Anna decided to provide personalized dedication and customized design in her cookies. She did this after learning that customers are willing to buy more and pay more if they could send specific thoughts and well-wishes together with the product. What marketing goal is she targeting with this strategy? __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ 1.2. Goals in Marketing 21 Unit 1: Marketing Principles and Strategies 5. If Anna wants to implement strategies to gain and retain loyal customers, what strategy would you suggest to her? __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ Challenge Yourself You are planning to set up a food-service business in the area you live in. Nearby, there is a business-process-outsourcing company that employs three hundred employees. You are targeting its employees as your customers. Formulate your business’s marketing goals and objectives by answering the following guide questions. 1. Formulate a mission and vision statement for your food-service business. __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ 2. Based on your mission and vision statements, develop at least two (2) marketing goals. __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ 1.2. Goals in Marketing 22 Unit 1: Marketing Principles and Strategies 3. Based on your marketing goals, create at least one objective for each goal that could be achieved in three months. __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ __________________________________________________________________________________________ Bibliography Kotler, Philip, Gary Armstrong, and Marc Oliver Opresnik. Principles of Marketing. 17th ed. New York: Pearson, 2017. Perreault, William, Joseph Cannon, and McCarthy Jerome. Essentials of Marketing: A Marketing Strategy Planning Approach. 15th ed. New York: McGraw Hill, 2017. 1.2. Goals in Marketing 23