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​Company wide strategic planning: Defining marketing's role Strategic planning is - the process of developing and maintaining strategic fit between the organisations goals and capabilities and its changing marketing opportunities Stems from the military, about offence and defence etc… Being able to...

​Company wide strategic planning: Defining marketing's role Strategic planning is - the process of developing and maintaining strategic fit between the organisations goals and capabilities and its changing marketing opportunities Stems from the military, about offence and defence etc… Being able to respond to constantly changing opportunities Market oriented mission: An organisations purpose - what it wants to accomplish in the larger environment A mission statement should ○ Be market-oriented ○ Be defined in terms of satisfying basic customer needs ○ Be meaningful and specific yet motivating ○ Emphasise the organisations strengths in the marketplace ○ Not be stated as making more sales or profits Defining Marketing's role: Setting company objectives and goals The marketing organisation needs to turn its mission into detailed supporting objectives for each level of management ○ Each manager should have objectives and be responsible for reaching them The broad mission leads to a hierarchy of objectives, including business objectives and marketing objectives ○ Companies have the overall objective of building profitable customer relationships by adding value for their stakeholders Marketing strategies and programs must be developed to support these objectives Marketing goal: Should be; ○ Specific ○ Measurable ○ Actionable ○ Relevant ○ Time-bound Designing the business portfolio: Is the collection of businesses and products that make the company Business portfolio planning involves two steps ○ Analyse its current portfolio and decide which businesses should receive ○ Shape the future portfolio by developing strategies for growth and downsizing Portfolio analysis is the process by which management evaluates the products and the businesses that make up the company Strategic business units (SBU's) are key to businesses that make up a company Most standard evaluation SBU's ○ Attractiveness of SB'Us market or industry ○ The strength of the SBU's position in that market or industry The Boston consulting group approach: The growth share matrix is a portfolio - planning method that evaluated a company's SBU's in terms of market growth rate and relative market share SUB's are classified as; ○ Stars: dominant market share and good growth prospects ○ Cash cows: dominant market shar and low growth prospects ○ Dogs: low market share and low growth prospects ○ Question marks: small market share of a growing market and require significant cash to build market share Problems with matrix approaches: The BCG and other methods revolutionised strategic planning but have limitations ○ Many companies have dropped formal matrix methods in favour of more customised approaches that better suit their specific situations Developing strategies for growth and downsizing: The product/market expansion grid is a portfolio-planning tool for identifying company growth opportunities Market penetration ○ Increasing sales of current products to current market segments without changing the product Market development ○ Identifying and developing new market segments for current company products Product development ○ Offering modified or new products to current market segments Diversification ○ Starting up or acquiring businesses outside the companies current products and market 1. What are some reasons why a company might choose to downsize its current business portfolios Planning marketing: Partnering to build customer relationships In addition to CRM, marketers must practice partner relationship management Partnering with other company departments - to form an effective internal value chain that serves the customer ○ The value chain is the series of internal departments that carry out value-creatin g activities to design, produce, market, deliver and support a firm's products Partnering with others in the marketing system ○ Partner effectively with other companies in the marketing system to forma. Competitively superior external value delivery network ○ The value delivery network is made up of the company, suppliers, distributors and ultimately customers who partner with each other to improve the performance to fit entire system 1. In what ways does marketing play a 'key role' in a company's strategic planning 2. Customer value-driven marketing strategy: before it can satisfy customers, a company must first understand their needs and wants Market segmentation ○ Process of analysing and dividing a market into distinct groups of buyers who have different needs, characteristics or behaviours, and who might require tailored products or marketing programs Market targeting ○ Process of evaluating each market segments attractiveness and selecting one or more segments to serve Positioning ○ Arranging for a product to occupy a clear, distinctive and desirable place in the minds of target consumers relative to competing products Differentiation ○ Differentiating the company's market offering from that offered by competitors so that it gives consumers more value 1. Why do marketing organisations avoid trying to be 'all things to all people'? Why are segmentation, targeting and positioning so important? ***** 1. Why do you think the sellers view and the buyers view differ? Examples? Managing the marketing effort: Market analysis ○ Managing the marketing function begin with a complete analysis of the marketing organisations situation ○ Market should conduct a SWOT analysis (companies Strengths, Weaknesses, Opportunities and Threats Marketing Planning ○ Involves deciding on marketing strategies that will help the company attain its overall strategic objectives Marketing strategy ○ Consists of specific strategies for target markets, positioning, the marketing mix an marketing expenditure levels ○ Outlines how the company intends to create value for target customers in order to capture value in return Marketing Implementation: process that turns marketing plans into marketing actions in order to accomplish strategic marketing objectives, marketing department organization takes different forms Functional organisation ○ Different marketing activities are headed by a functional specialist ○ Specialists can include; Advertising manager, sales manager, marketing research manager, customer service manager, new product manager Geographic organisation ○ Often used by a company that sells across the country or internationally Product management organisation ○ Often used by companies with many different products or brands ○ Under this approach, a product manager develops and implements a complete strategy and marketing program for a specific product or brand Market or customer management organisation ○ Often used by companies that sell one product line to many different types of markets and customers that have different needs and preferences Measuring and managing return on marketing investment: Today marketers are being held accountable for linking their strategies and tactics to measurable marketing performance outcomes Return on marketing investment (or marketing ROI) Net return from a marketing investment divided by the costs of the marketing investment Measures the profits generated by investments in marketing activities A company can assess return on marketing investment in terms of standard marketing performance measures e.g. brand awareness, sales, market share Marketers are increasingly using customer-centred measures of marketing impact, such as; ○ Customer acquisition ○ Customer retention ○ Customer lifetime value ○ Customer equity (combined CLV of all customers) Marketing investments result in improved customer value and satisfaction, which in turn increase customer attraction and retention ○ This increases individual customer lifetime values and the firms overall customer equity ○ Increased customer equity, in relation to the cost of the marketing investments, determines marketing ROI Dashboards The marketing Environment: The companies microenvironment: Marketing success requires building relationships with: ○ Other company departments ○ Suppliers ○ Marketing intermediators ○ Competitors ○ ○ Various publics Customers The company: has many components Top management Finance Research and development Purchasing Operations Accounting Suppliers: Form an important link in the company's overall customer value delivery system Most marketers today treat their suppliers as partners in creating and delivering customer value Marketing intermediaries: Businesses that help promote, sell and distribute its products to final buyer They include; ○ Resellers - distribution channel firms that help the company find customers or make sales to them ○ Physical distribution firms - help the company to stock and move goods from their points of origin to their destinations ○ Marketing services agencies - the marketing research firms, advertising agencies, media firms and marketing consulting firms that help the company to target and promote its products to the right markets ○ Financial intermediaries - banks, credit, companies, insurance companies, accountants and other businesses that help to finance transactions or manage the risks associated with the buying and selling of goods Competitors: To be successful, a company must provide greater customer value and satisfaction than its competitors do, marketers must do more than simply adapt to the needs of target consumers. They must gain strategic advantage by positioning their offerings strongly against competitors' offerings in the midst of consumers No single marketing strategy is best for all companies Publics Is any group that has an actual or potential interest in or impact on an organisation's ability to achieve its objectives They include; ○ Media, government and citizen-action groups They can be; ○ Financial, internal, local and general Customers: the most important actors in the company's microenvironment, companies may target any or all 5 types of customer markets Consumer markets ○ Individuals and households that buy goods and services for personal consumption Business markets ○ Buy goods and services for further processing or for use in their production process Reseller markets ○ Buy goods and services to resell at a profit Government markets ○ Government agencies that buy goods and services to produce public services or to transfer the goods and services to others who need them International markets ○ Buyers in other countries, including consumers, producers, resellers and governments The company's macroenvironment: The company and all of the other actors operate in a larger macroenvironment of forces that shape opportunities and pose threats to the company Demographic: the study of human populations in terms of Population size, density and diversity Age and gender Race and ethnicity Family size and structure Educational characteristics and occupation Other demographic statistics Marketers tend to keep close track of demographic trends and developments Changing age structure of the population is the single most important demographic trend in Australasia, falling birth rates and longer life expectancies mean Australia and NZ populations are rapidly aging 1. Give some examples of the potential impact of ageing populations on markets and marketers Changing age structure: Baby boomers (1946 - 1964) ○ 28% of Aus population ○ Control 56% of wealth Gen X (1965 - 1980) ○ Small population group ○ Prize experience, no acquisition and are frugal and price sensitive Millennials (1977 - 2000) ○ Largest generation in Aus and NZ ○ First generation to grow up with digital technology Gen Z (2000+) ○ Blend online and offline worlds seamlessly ○ Care about climate change and environment as well as gender and social equity Generational Marketing: Need to be careful about 'turning off' one generation at a time as they craft a product or message that appeals effectively to another generation Generations span decades and socioeconomic levels Marketers need to form more precise age-specific segments in each group The changing family: Trends in the family structure include; ○ Slight decrease in two parent households ○ Little change in single-parent family proportion ○ Steady increase in number of families with no children at home ○ Increasing number of one-person households ○ Overall decline in household size ○ Increase in women in the workforce Geographic shift in population Gradual geographic shift of population from rural to metropolitan areas 'telecommute' Better educated, more white-collar, more professional population Over 40% of the Aus population and 34% of NZ have attended university Increasing diversity Aus and NZ relatively diverse populations Almost one in three born overseas Aus LGBTQ buying power estimated $20 billion p/a 4.3 million Aus and 1 million NZ living with disability Economic environment: Consists of factors that affect consumer purchasing power and spending patterns Changes in income - marketers should pay attention to income distribution as well as income levels Rich have grown richer and poor have grown poorer 1. Give some examples of how companies tailor their marketing in response to these changes in income distribution The natural environment: Involves natural resources that are needed as inputs by marketers or that are affected by marketing activities - marketers should be aware of several trends in the natural environment 1. Growing shortages of raw materials 1. Air and water 2. Renewable resources (forest, food) 3. Non-renewable resources (oil, coal, various minerals) 2. Increased pollution 1. Industry will almost always damage the quality of the natural environment 3. Increase government intervention in natural resource management 1. The govt of different countries vary in their concern and efforts to promote a clean environment Environmental sustainability involves developing strategies and practices that create a world economy that the plant can support indefinitely - link between healthy ecology and healthy economy 1. Can you think of some companies whose business practice demonstrate a commitment to environmental sustainability? Are they successful? Technological Environment: Comprises the forces that create new technologies, creating new products and market opportunities As products and technology become more complex, the public needs to know these are safe ○ In Aus and NZ, there are comprehensive laws and guidelines to help businesses develop safe new products 1. Give examples of how new technologies have influenced what we buy, how we pay and how we shop. Political and Social environment: The political environment consists of laws, govt agencies and pressure groups (climate, war) that influence or limit various organisations and individuals in a given society Legislation regulating business: Even the strongest advocates of free-market economies agree that the system works best with some regulation Legislation affecting business around the world has increase steadily Business legislation has been enacted for a number of reasons. The purpose of govt regulations include; ○ Protect companies from each other ○ Protect consumers from unfair business practices ○ Protect the interests of society against unrestrained business behaviour Marketers need to know about the main laws protecting competition, consumers and society. They need to understand these laws at the local, state, national and international levels 1. How familiar are you with these laws? Increased emphasis on ethics and socially responsible actions ○ Beyond written laws and regulations, business is also governed by social codes and rules of professional ethics Socially responsible behaviour ○ Beyond the regulatory system; simply "do the right thing" ○ Social and ethical issues in online marketing (e.g. privacy) ○ There has also been an explosion in the amount of personal digital data available ○ Companies may now know too much and use digital data to take unfair advantage of consumers Cause-related marketing ○ To exercise their social responsibility and build more positive images, many companies are now linking themselves to worthwhile causes ○ Cause-related marketing has become a primary from of corporate giving Cultural environment Is made up of institutions and other forces that affect a society's basic values, perceptions, preferences and behaviours Persistence of cultural values ○ People in a given society hold many beliefs and values ○ Core beliefs and values are passed on from parents to children and are reinforced by schools, churches, business and govt ○ Secondary beliefs and values are more open to change Shifts in secondary core values ○ Although core values are fairly persistent, cultural swings do take place ○ Consider the impact of pop music groups, and other celebrities on young peoples hairstyling and clothing norms ○ Marketers want to predict cultural shifts to spot new opportunities or threats ○ Peoples view of themselves Vary in their emphasis on serving themselves vs others Use products etc as form of self expression Buy products etc that match their view of themselves ○ Peoples view of others Attitude towards, and interactions with others shift over time Using online social media and mobile communications to connect more than ever "alone together" New ways of interacting strongly affect how companies market their brands and communicate with customers ○ Peoples view of organisations Vary in attitude towards corporations, govt agencies, trade unions, universities etc. Work is not seen as source of satisfaction but rather a chore to enjoy their non-work hours Organisations need to find new ways to win consumer and employee confidence ○ Peoples view of society Attitude varies Peoples orientation to their society influences their consumption patterns, level of savings and attitudes towards the marketplace Marketers need to monitor the consumers' changing social orientations and adapt their strategies accordingly ○ Peoples view of nature Attitude varies towards the natural world Recently people have recognised the nature is finite and fragile and can be harmed by humans This renewed love of natural things has created a market of consumers who seek everything natural, organic and nutritional products to fuel-efficient cars and alternative medicine - greenwashing? ○ Peoples view of the universe Vary in attitude of origin of the universe and their place in it Religious conviction and practice have been declining through the years Some futurists have noted a renewed interest in spirituality, perhaps a part of a broader search for new inner purpose Responding to the marketing environment: Many companies view the marketing environment as an uncontrollable element to which they must react and adapt Other companies take a proactive stance towards the marketing environment Smart marketing managers will take a proactive - rather than reactive - approach to the marketing environment