2

PRINCIPLES OF MARKETING

Company and Marketing Strategy:

Partnering to Build Customer

Relationships

Saihad Shahid Rahman, Spring, 2014-2015

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE

Strategic Planning
Strategic Planning is the process of
developing and maintaining a strategic fit
(balance) between the organizations goals
& capabilities and its changing marketing
opportunities.
It is long-term planning to cope up with the
current changes in the industry and to take
advantages of those opportunities.
And, Strategic planning sets the stages for
the rest of the planning in the firm.

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE

Steps in Strategic Planning

Business Unit &
market and
product

Corporate Level

Defining
the
company
mission

Setting
company
objectives &
goals

Designing
the Business
Portfolio

Planning
marketing &
other functional
strategies

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Defining a Market-Oriented Mission
The Mission Statement is the organizations
purpose, what it wants to accomplish in the larger
environment.
A clear mission statement acts as an invisible hand
that guides the people of the organization. Mission
should be:
- Specific
- Realistic
- Fit with the market environment
- Based on distinctive competencies
- Motivating

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Defining a Market-Oriented Mission
Mission statement of Unilever

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Setting Company Objectives and Goals
Objectives are the specific tasks that has to be
accomplished within a specific time period.

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Designing the Business Portfolio
What is Business Portfolio?
The Business Portfolio is the collection of
businesses and products (Strategic Business
Units) that make up the company.
Business portfolio is like a business profile, where a
company may have multiple units or parts.

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Designing the Business Portfolio
What is Strategic Business Unit (SBU)?
Strategic Business Unit (SBU) is an unit of the
company that has a separate mission and
objectives that can be planned separately from
other company businesses.
A single company division (sister concern), a
single product line within a division, or a single
product/brand of an organization can be
considered as separate Strategic Business
Units.

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Analyzing the Current Business Portfolio

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Analyzing the Current Business Portfolio
The Boston Group Approach (Growth-Share Matrix)

Growth-Share Matrix is a portfolio planning

method that evaluates a companys strategic
business units in terms of their market growth
rate and relative market share.
On the vertical axis, market growth rate
provides a measure of market attractiveness. On
the horizontal axis, relative market share
serves as a measure of company strength in the
market.

ANALYZING CURRENT SBUS:

BOSTON CONSULTING GROUP APPROACH

ANALYZING CURRENT SBUS:

BOSTON CONSULTING GROUP APPROACH

Relative Market Share

Low

High

Market Growth Rate

High

Stars
High growth & share
Profit potential
May need heavy
investment to grow

Cash
CashCows
Cows
Low
Lowgrowth,
growth,high
highshare
share
Established,
successful
Established, successful
SBUs
SBUs
Produce
Producemore
morecash
cash

Low

Question
QuestionMarks
Marks

High
Highgrowth,
growth,low
lowshare
share
Build
into
Stars
or
Build into Stars orphase
phaseout
out
Require
cash
to
hold
Require cash to hold
market
marketshare
share

Dogs
Dogs
Low
Lowgrowth
growth&&share
share
Low
profit
potential
Low profit potential
Require
Requiresubsidy
subsidy

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Analyzing the Current Business Portfolio
The Boston Group Approach (Growth-Share Matrix)
Stars are high-growth, high-share businesses or products
requiring heavy investment to finance rapid growth.
They will eventually turn into cash cows.

- When growth slows, stars become cash cows if they have been able
to maintain their category leadership.

Cash Cows are low-growth, high-share businesses or

products that are established and successful SBUs
requiring less investment to maintain market share.

- These are mature, successful business with relatively little need for
investment. They generate to continue the strong cash flows that
the company needs for its stars.

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE

Analyzing the Current Business Portfolio

The Boston Group Approach (Growth-Share Matrix)
Question Marks are low-share business units in highgrowth markets requiring a lot of cash to hold their
share.

- A question mark has the potential to gain market share and

become a star, and eventually a cash cow when the market
growth slows.

Dogs are low-growth, low-share businesses and products

that may generate some cash to maintain themselves but
do not promise to be large sources of profit for the
organization.

- These units typically "break even", generating barely enough cash

to maintain the business's market share.

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Analyzing the Current Business Portfolio
The Boston Group Approach (Growth-Share Matrix)

Problems with Matrix Approaches

- Difficulty in defining SBUs and measuring
market share and growth
- Time consuming
- Expensive to combine everything
- Focus on current businesses, not directly
concentrated on future planning

COMPANYWIDE STRATEGIC PLANNING:

DEFINING MARKETINGS ROLE
Developing Strategies for Growth and Downsizing
Downsizing is the reduction of the business
portfolio by eliminating products or
business units that are not profitable or no
longer fit the companys overall strategy.
Example: Unilever has stopped the production,
distribution, communication and sales of their
Rexona soap as part of downsizing.

MARKETING STRATEGY AND

THE MARKETING MIX
Customer-Driven Marketing Strategy
Market Segmentation is dividing a market
into separate groups of buyers who have
distinct needs, characteristics, or behavior
and who might require separate products or
marketing mixes.
Consumers (B2C market) can be grouped and
served in various ways based on:
Geographic factors
Demographic factors
Psychographic factors, and
Behavioral factors

MARKETING STRATEGY AND

THE MARKETING MIX
Customer-Driven Marketing Strategy
Market Segment is a group of consumers who respond
in a similar way to a given set of marketing efforts.
Example: For a telecom company (GP); Teenage &
students, Households and Corporate people can be
different segments of market.
Target Marketing is the process of evaluating each
market segments attractiveness and selecting one or
more segments to enter into/ to offer products.
Example: GP can target teenage & students for
Djuice/Internet, households for Smile and
corporate people for its Business solution packages.

MARKETING STRATEGY AND

THE MARKETING MIX
Customer-Driven Marketing Strategy
Market Positioning is the arrangement for a
product to occupy a clear, distinctive, and
desirable place relative to competing products
in the minds of the target consumer.
Marketers can position their offerings by using
different variables like: Product benefits, Services
standard, Brand image, Pricing, Distribution
channel etc.
Example: GP is positioning its Djuice by low price & social
benefits, Smile by verities of product benefits and
Business solution by customized facilities.

MARKETING STRATEGY AND

THE MARKETING MIX
Developing an Integrated Marketing Mix
The four Ps
Marketing Mix is the set of controllable
tactical marketing tools that the firm blends
to produce the response it wants in the
target market.
Product, Price, Place, and Promotion

MARKETING STRATEGY AND

THE MARKETING MIX
Developing an Integrated Marketing Mix
The four Ps
Product is the goods and services or combination of those
that the company offers to the target market at a price.
Price is the amount of money customers have to pay to obtain
the product.
Place (distribution) is the company activities that make the
product available to target customers at their
convenience.
Promotion is the activities that communicate the merits of
the product and convince the target customers to buy it.

MARKETING STRATEGY AND

THE MARKETING MIX
Developing an Integrated Marketing Mix
The four Ps
Product
Variety
Quality
Design
Features
Brand Name
Packaging
Services

Price
List Price
Discounts
Allowances
Payment Period
Credit Terms

Place

Target
Customers

Channels
Coverage
Assortments
Locations
Inventory
Transportation
Logistics

Promotion
Advertising
Personal Selling
Sales Promotion
Public Relations

MANAGING THE MARKETING EFFORT

Marketing Analysis
Marketing Analysis is the complete evaluation of the
companys situation in a SWOT analysis form that
evaluates the companys Strengths, Weaknesses,
Opportunities, and Threats.

MANAGING THE MARKETING EFFORT

Market Planning
Marketing Planning includes the development
of overall strategic and marketing plans to
achieve companys goals and objectives.

MANAGING THE MARKETING EFFORT

Marketing Implementation
Marketing Implementation 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, decision and reward
system, and company culture into a cohesive
action plan that supports its strategies.

MANAGING THE MARKETING EFFORT

Marketing Implementation
Marketing Department Organization

MANAGING THE MARKETING EFFORT

Marketing Control
Marketing Control is measuring and
evaluating results of marketing strategies &
other executions against the actual plan and
taking corrective actions to ensure that
objective are achieved.
Operating control involves checking on going
performance against annual plan and taking
corrective action when necessesary.
Strategic control involves looking at whether
the companys basic strategies are well matched
to its opportunities.

END of CHAPTER - 2