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23 Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 23 eting S tr k eti ng ateg ies

Contemporary Marketing 3rd Edition Boone Solutions Manual Download:http://testbanklive.com/download/contemporary-marketing-3rd-editionboone-solutions-manual/ Contemporary Marketing 3rd Edition Boone Test Bank Download:http://testbanklive.com/download/contemporary-marketing-3rd-editionboone-test-bank/ CH APTER 2 STR ATEGI C PL ANNI NG I N CONTEM POR ARY M AR K E TI NG CH AP TER O VERVI EW T oday’s m ark eter s f ace st r at eg ic q uest ions every day. Planning str ateg y is a cr it ical par t of t heir j obs. T he m ark et place chang es continually in r esponse t o chang es in consum er t aste s and expect at ions, t echnolog ical developm ents, com pet it or s’ act ions, econom ic tr ends, and polit ical and leg al event s, as we ll as pr oduct innovations and pr essur es f r om suppliers and distr ibut or s. Alt houg h t he causes of these chang es of t en lie outside a m ark eter ’s cont rol, ef f ective planning can ant icipat e m any of t hem . For example , when t he price of g as and j et f uel soar ed r ecently, t r avel lers opt ed t o st ay close t o hom e inst ead of enj oying vacat ions t o exotic, f araway places. T his r epr esented an oppor t unit y f or places like Banf f , Alber t a, and Niag ar a Falls, O nt ario . Any dest inat ion t hat prom oted itself t o pot ent ial vacat ioners wit hin a short dr ive could f ind itself adding up t he prof it s. T his chapter lays a f oundat ion f or analyzing all aspects of m ark etin g by dem onstr ating t he im port ance of g at her ing r eliable inf ormation t o cr eat e an ef f ect ive plan. T hese act ivit ies pr ovide a str uctur e f or a fir m t o use it s uniq ue st r engths. Mark eting planning identif ies t he m ark et s a com pany can best serve as well as t he m ost appropriat e m ix of approaches t o sat isf y t he cust om ers in t hose m ark et s. W hile t his chapt er f ocuses on planning , in lat er chapter s t he t ask of m ark et ing research and decision m ak ing will be explored. Changes i n t he Thir d Canadi an Editi on T he chapter has been updat ed and r evised, wit h new f eat ur es in several areas: The O pening Vi gnett e and Connecti ng w it h Cust omers prof ile a business you m ay not have heard of — Af exa Lif e Sciences —and t he “ ups and downs and ups” it has exper ienced as it t r ies t o establish itself in t he m ark et place. T he com pany was or ig inally called CV T echnolog ies. It is an excit ing Canadian m ark et ing st or y. CV T echnologies is a f ir m t hat ef f ectively combines tr adit ional m ark et ing m edia―radio and t elevision ads and point - of - pur chase displays―wit h newer prom otion t echniq ues: public r elations, celebr it y endor sem ents,


24 Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 24 eting S tr k eti ng ateg ies

and word - of -m out h pr omot ion. An inter est ing aspect wort hy of class discussion is t he value of m ark et ing t o t his t echno log y f irm. I t has been spending as m uch as 20 per cent of it s r evenue on m ark eting expenses as it has been at t em pt ing m ark et penet r at ion, product developm ent, and mark et developm ent as growt h st r at eg ies. Solvi ng an Et hi cal Cont rovers y analyzes t he case of c elebr it y endor sem ent s. I t also discusses t he q uest ion “ Should com panies hold t he celebr ities who endor se t heir products accountable f or t heir per sonal act ions? ” T he issue of br ands being ident if ied wit h celebr it ies and t he ef f ect of t heir per sonal lif e on t he perf or m ance of t heir endor sed brand is also analyzed. T he pros and cons of t his issue ar e discussed in “ T ig er W oods Dr ives His Career into t he Roug h.” G o G reen descr ibes how t he Canadian r etail industr y is helping cr eat e envir onm ent ally r esponsible consum ers. Canadian consumer s are am ong t he world’s m ost envir onm ent ally conscious. Mark eter s who are best prepar ed f or the m ovement t oward envir onm ent al sustainabilit y wil l have a compet it ive advant ag e as t his m ovement cont inues. T oday, “G r een Bag s O utnum ber Canadians.”


25 Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 25 eting S tr k eti ng ateg ies

M arketi ng and t he SM E descr ibes t he way a small ent r epr eneur ial f irm is chang ing t he way divorce is happening around t he world. Pr esident and CEO Kar en St ewart says, “[ It ] is about educat ing t he public on the ent ir e process of divorce, f r om r e m oving em ot ions f r om decision m ak ing, t o work ing t o preser ve t he dig nit y of t he f amily. ” Find out m or e in “ Fair way Di vorce Solutions: Franchising a Fair W ay t o Divorce. ” M arketi ng i n a Digi t al Worl d descr ibes how social m edia can help you increase your vis ibi lit y, st ay in t ouch wit h your t ar get audience, and f ind pr ospective cust omer s. There ar e som e pot ent ial pitf alls f or you t o consider t houg h. G et g ood advice in “ Adding Social Medi a t o Your Mark eting St r ateg y.” Career Readiness provides som e sim ple g uide lines t o ensure t he success of a conf er ence over t he phone or I nt ernet . For det ails, r ef er t o “ G oing Acr oss t he Count r y or Around t he W or ld t hr oug h Vir t ual Meet ing s.” Chapter Case 2. 1 “ Food Fig ht ” f eat ures t wo Canadian pizza com panies —Pizza Pi zza and Panag o Pizza—as t hey f ig ht f or pizza dom inance. T he t wo com panies ar e eng ag ing each ot her across Canada as t hey im plement st r ong g r owt h st r at eg ies in a f ierce bat t le f or m ark et shar e. Chapter Case 2.2 “ St ar buck ’s Str ateg y: I t ’s a Small W or ld Af t er All” descr ibes St ar buck s and its aggressive gr owt h str ateg y, including plans t o open m any new st ores in various int er nat ional m ark et s. T he company intends t o t arg et young er consumers t hroug hout t he world, and is scout ing countr ies and locations f or m ore St ar buck s st or es. I t is developing st r at egic alliances and par t ner ships in several m ark et s, but it has also been subj ect t o an unpr edict able and uncont r ollable polit ical envir onm ent in som e r eg ions. I n ot her r eg ions, t he econom ic envir onm ent poses a challeng e and, in ot her r eg ions, t he social - cult ural envir onm ent m ay be an obst acle. Coll aborat i ve Learni ng Exerci ses ar e pr ovided in several areas r elated to str ateg ic planning and t he m ark eting pr ocess —Planning T hr oug h out t he O rg anization, Def ining t he Org anization’s Mission and O bj ectives, St r ateg ic Planning , For mulating a Mark et ing Str ateg y, Pr omot ion St r ateg y and Pr icing Str at eg y, T he Mark eting Envir onm ent , and BCG Matr ix. Vi deo Case Synopsi s includes an overvie w of st r at eg ic planning and t he m ark eting pr ocess at Pr eser ve, a consum er products company.

LECTURE O UTLINE O peni ng Vi gne tte and Con nec tin g with C us tom ers —Af ex a Lif e Sc ie nc es , f orm erly C V T ec hnol ogi es , has been s el lin g i ts f lags hi p pr o duc t, CO LD - F X , s inc e 19 96 . It has bee n em plo yin g a v ariet y of gro wt h s tr ate gi es and is no w att em pting b oth produc t d ev el opm ent an d m ark et develo pm ent as it a ttem pts to ac hie ve great er s uc c es s .


26 Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 26 eting S tr k eti ng ateg ies Ch apt er O b je ctiv e 1: Disti n g u ish b etw een strat egic p lann ing and t act ic al p lan n ing . Ke y T erms: p la nn ing, m ark eting pl ann in g, s tr ate gic p l ann in g, tac tic a l p la nn ing Po w erPo int Bas ic: 3 Po w erPo int E xpan d ed: 3- 5


25 Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 25 eting S tr k eti ng ateg ies

1. Mar k eting p la nni ng: the ba s is f or s tr ateg y a nd t ac tic s a. Def init ion of pla nn ing : th e p r oc es s of antic ip ati ng f utur e ev ents a nd c ondit io ns and the n d eter m ini ng t he bes t wa y t o ac h ie ve organ i zati ona l o bj ec ti ves Car eer Re ad ines s — G oing Ac r os s the Countr y a nd Ar ou nd the W orld thr ough Vir tu al Me eti ngs . As k s tudents t o pr ov i de a few ot her s ug ges ti ons to ens ure tha t par tic i pan ts s tay foc us ed d urin g v ir tu al meet ings .

b. Pla nn ing is im por tant f or b o th l arge a nd s m all c om pani es . c. Mar k eting p la nni ng i. Mar k eting p la nni ng r ef ers t o im plem enting pl ann ing ac tiv it ies de vo ted to ac h ie v i ng m ark eting o bj ec tiv es . ii. An im por tant tr en d i n m ark etin g p lan ni ng c e ntre s on r elat ions h ip m ark eting . d. G ood re la t ions h ips with c us tom ers c an arm a f irm with vit al s tr ategic weap ons . e. Man y c om panies n o w inc l u de r el ati ons h ip - b ui ldi ng goa ls and s tr ategi es in the ir m ark eting pl ans , m ainta in ing dat aba s es to trac k c us tom er pr ef erenc es . 2. Str ate gic p la nni ng vers us t ac tic al pl ann in g a. Str ate gic p la nni ng is def in e d as th e pr oc es s of det erm inin g an organ i zati on ’s prim ar y obj e c tives and ado pti ng c o urs es of ac tion that wil l ac h ie ve thes e obj e c tives . b. Str ate gic p la nni ng inc l udes all oc ati on of r es our c es , and prov ides lon g- term dir ec tion s f or the dec is io n m ak ers . c. T ac tic al pl ann ing , a c om ple m entar y appro ac h to s tr ate gic pla nni ng, gu ides t he im plem entation of ac ti v iti es s pec i f ied in the s tr ategic p la n . d. It ad dres s es s hor ter - term ac tions , f oc us ing on ac ti vit ie s that n eed to be c om pleted s o th at lar ger s tr ateg ies c an be im ple m ented. As se ssmen t chec k qu est i o n s

1. Def in e p lan nin g. Pl ann in g is th e pr oc es s of ant ic ip at ing future ev en ts and c ondit io ns and of deter mi ni ng th e b es t way to ac hi ev e organ i zati Ch apt er O b je ctiv e 2: ona E xpl h otivwes market ing plan s d if f er at v ariou s lev els in an o rg aniz atio l oain bj ec . n. Ke y T erms: n one 2. G i ve an ex am ple of s tr ate gic p la nni ng and tac tic a l p lan nin g. T o s urv Po w erPo int Bas ic: 4 iv e in a c hall eng in g e nv ir on ment of s oar ing fue l c os ts , s ev eral air l ines aroun Po w erPo int E xpan d ed: 6 d th e wor ld hav e d ec ide d to mer g e as par t of the ir s tr ateg ic p lan ni 1. ingalatpldif f erent or ga zat gion le ve ng.Pla Tacnnt ic ans i nc lud e cniuttin th al e nu mblser of f li ght s and c har g in g p ger s at kaled l org T able 2.1 P lan ni ng as s enger s a. exMana tr a for c hec ba an ggai zati ge .o nal le ve ls de vot e s om e at Dif f erent Man ager of their atten tio n to pl ann in g ac t iv iti es . ial Lev els . W hic h b. T he am ount of tim e s pent o n pl ann in g ac ti v iti es an d th e t mana ger s foc us mos yp es of pla nni ng var y b y or gan i zati ona l l ev el . t on bro ad goa ls an d 2. T op m anage m ent ( CEO a n d f unc tion al v ic e - pres id ents ) lon g- term pla nn ing ? a. Spe nd m ore of their t im e on pl ann in g th an d o lo wer W hic h mana ger s foc l e ve l m anagers us mos t on pl an nin g b. Us ual l y f oc us m ore on l ong - r ange s tr ate gic is s ues for day - to- day tas k s ? 3. Mid dl e m anage m ent Note: Dis c us s how t

a. T end to f oc us on o per at ion al p la nni ng, wh ic h i nc lud es c r eating


27 Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 27 eting S tr k eti ng ateg ies .


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 26 26 eting S tr k eti ng ateg ies

c ompan ies appro ac hed a s im i lar probl em diff erent ly , with dif ferent r es ults . How Y ah oo! and Mic r os oft appro ac hed c omp et in g ag ai ns t G oogl e is one goo d ex amp le.

and im plem enting t ac tic al p lans f or the ir o wn de par tm ents b. Sup erv is ors of ten de ve lo p s pec if ic program s to m eet goa ls in the ir areas of r es pons i bi lit y. c. T o be m os t eff ec tive, th e p l ann ing proc es s inc l udes in put f r om a wide r ang e of s our c es , i nc l udi ng em plo yees , s u pp li ers and c us tom ers . As se ssmen t chec k qu est i o n s 1. Ho w do m ark eting pl ans dif f er at dif f erent le ve ls of the or g an i zati on? T op mana ger s us ua lly f oc us th e ir pl ann in g ac tiv iti es on lon g - r ange s tr at eg ic is s ues . I n c ontr as t, m idd le - lev el ma na ger s foc us on op erati ona l p lan nin g, w hic h inc l udes c r eating an d i mp lem ent ing tac tic al pl ans for t he ir own units . Su per v is ors dev e lop s pec ific pr ogr ams t o m eet goa ls in the ir areas of r es p ons ib il ity .

2. W hy is i t im por tant t o g et inp ut f r om other s wh en p la nni ng? Inp ut fr o m a v ar iety of s our c es —ot her e mp loy e es , s upp liers , or c us tomers —he ens m any idet h aseare ider e d. I nnving ol vproc ing tess. hos e p eop le in pl Ch apt er O b je ctiv e 3: lps Iden t ifuryet th h eatstep s in marc kons etin g plan ann i ng c an als o turn t hem in to adv oc ates f or the pl an. Ke y T erms: m is s ion, m ark etin g s tr ate g y Po w erPo int Bas ic: 5- 8 Po w erPo int E xpan d ed: 7- 11 1. Steps in t he m ark eting pl an nin g pr oc es s a. Def ine t he m is s ion . F igur e 2.1 T he Mar b. Deter m ine obj ec ti v k eting Pl ann ing Pr es . c. As s es s r es our c oc es s . W hic h s tep es . mig ht b e m ore d iff d. Ev alu ate en vir o nm ental r is k s and op por tu ic ult than it s e ems ? W hic h s tep do y ou t nit ies . e. F orm ulate a m ark eting s tr at eg y. hink c a n be e as ily f. Im plem ent the s tr at eg y thr o ugh opera tin g p lans . ov er look e d? g. G ather f eedb ac k to m onitor and ada pt s tr ate gi es whe n nec es s ar y . 2. Def inin g th e or g an i zati on ’s m iss ion an d o bj ec Note: Cho os e a c o tiv es a. T he organi za tio na l m is s ion upl e of l oc al organ i i. T he m is s ion is th e es s ent ia l pur p os e th at dif f zat ions and us e th eir erentiat es the organ i zati on f r om other s . m is s ion s tateme nts ii. T he m is s ion s tatem ent s pe c if ies the or g an i zati on as c las s ex amp les . ’s ov erall goa ls and op erati ona l s c op e an d pr o vi des g enera l gui del in es f or f utur e m anagem ent ac tions . G o Gr een: G r e en Bags O ut num ber Cana dia ns . As k s tudents t o i den tify c ompan ies f or wh ic h the “ gre en ” env ir on men t c r eates an o pport uni ty and fo r whic h it c ons t itut es a threat.

ii i. Adj us tm ents m ade to m is s ion s tat em ent ref lec ts c hangin g bus in es s env ir onm ents an d m anagem ent phil os op hies . b. T he organi za tio na l o bj ec tiv es i. T he bas ic obj ec ti ves , or go als , i n a f ir m ’s m is s ion s tatem ent gui de t he de vel o pm ent of s uppor tin g m ark eting goa ls and pl ans . ii. O bj ec tives s h oul d s tat e s pe c if ic inten tio ns an d s pec if y a tim e period f or s pec if ic ac h i evem ents .


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 28 28 eting S tr k eti ng ateg ies .


27 Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 27 eting S tr k eti ng ateg ies

Do adv ert is em ents v iewed as per s ona li ze d by mar k eter s inv ade priv ac y ? Do y o u th ink the p ote nti al of m ob ile adv ertis i ng w il l pr ov ide a c omp etit iv e edg e?

produc ti on, m ark eting, f ina nc e, tec h nol og y, a nd em ploye es . c. En vir o nm ental ef f ec ts c an em erge both f r om with in t h e organ i zati on and f r om the e x ternal en vir o nm ent . 4. F orm ulati ng, im plem enting , and m onitor ing a m ark etin g s tr ateg y a. A go od m ark eting pl an r e vo lv es arou nd a n ef f ic ient, f le x ible , an d adap tab le m ark eting s tr at e g y. b. A m ark eting s tr ate g y is an overa l l, c om pan ywi de progr am f or s elec ti ng a tar g et m ark et and s at is f ying c us t om ers in that m ark et throug h th e e lem ents in t he m ark eting m ix — produc t, di s tr ibuti on, prom otion, a nd pr ic e . c. T he s tr ateg y m us t be m onit ored to ens ure tha t obj ec t iv es are bei ng m et. 5. In th e t wo f inal s teps of the pl a nni ng proc es s , m ark eters put th e m ark eting s tr ateg y in to ac t io n; th en t h e y m onitor per f orm anc e to ens u r e th at obj ec ti ves are ac hi ev ed. 6. Som etim es s tr ategies nee d to b e m odif ied if th e pr od u c t’s or c om pan y’s ac tual per f orm anc e is not i n l ine wit h ex pec t ed r es u lts . As se ssmen t chec k qu est i o n s

1. Dis t ing uis h bet wee n an organ i zati on ’s m is s ion and its obj ec ti ves . T he f ir m ’s mis s ion is th e es s en tia l p ur pos e th at d iff erent iat es the c ompany fr om o ther s . Its obj ec tiv es gu id e d ev elo pm ent o f s upp orti ng m ark eti ng obj ec tiv es a nd p la ns . Sep hor a ’s mis s i on is to b e “ the be auty a . ” Osucc ne ofessfu its objl pl ecann tiv es to c tonv pac ag ing to Po r rt Ch apt er O b je ctiv e 4: uth De ority s cribe inm g ig t ohtoblseand echert n al iqul its e s, i nk clud ing e r’s F iv e ec y c led mat eria ls . F o rces mo d el, f i rst an d s eco n d mo v er str ateg ie s, SW O T analysis, and t h e s t rateg ic w ind ow. 2. W hat is the im por tanc e o f the f inal s t ep in t he m ark eting pl ann in g pr oc es n es , f ir s t m over s tr ateg y, s ec ond m over s tr ateg y, S W OT anal Ke y T erms: Porter ’s Fivse?FI orc the f l s otewp of the m ark et i ng p lan ni ng pr oc es s , man a ger s mon itor per ys is , s tr ate gicina wind form anc e t o ens ure th at o bj ec tiv es are ac hiev e d. Po w erPo int Bas ic: 9- 12 1. Suc c es s f ul s tr ategi es : to ols and tec hn iqu es Po w erPo int E xpan d ed: 12 - 17 a. F our too ls f or m ark eting pla nni ng inc lu de Port er’s Fi ve F orc es m odel, f ir s t and s ec on d m over s tr ate gi es , SW OT anal ys is , and the s tr ategic win do w. Sol v ing an Eth ic al Contr o vers y: T iger W oods Dr ives H is Car eer i n to the Rou gh

b. Al l th es e p lan ni ng s t r at egi e s hav e th e go al of c r eatin g a s us taina bl e c om petiti ve ad van tag e f or a f irm , m eaning that oth er c om panie s c a nnot pro vi de t he s am e val ue. 2. Porter ’s F iv e For c es a. Porter ’s F iv e For c es is a m ode l th at i den tif ies f iv e c om peti ti ve f orc es that inf lue nc e p la nn i ng s tr ate gies .

F igur e 2.2 Port er’s F ive For c es Mo del . Choos e one of t he forc es and t hi nk of t he way s it rel ates t o a r eal- wor ld m ark eti ng s ituat ion .

b. Porter later upd ate d h is m odel to inc lu de t he im pac t of the I nter ne t on th e s tr ate gi es that bus i n es s es us e . c. T he y are: i. T he thr eat of ne w en tr ants — is i nf luenc e d b y th e c os t and dif f ic ult y of enteri ng a m ark et. T he Int ernet has r ed uc e d the b ar r iers to m ark et entr y in m an y ind us tr ies . ii. Barga in ing po wer of bu yers —c an i nf luenc e the f irm ’s


29 Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 29 eting S tr k eti ng ateg ies .


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 28 28 eting S tr k eti ng ateg ies Del l ’s s tr en gths a nd tak e adv a nta ge o f th e c onfus io n c aus e d by the p end in g HP/Co mp aq mer ger .

Mar k eting a nd t he SM E: Fa ir wa y Di v orc e Sol uti ons : Fr a nc his i ng a Fair W a y t o Di vorc e. As k s tudents w het her this n ew b us ines s mode l c a n be nef it fro m a fir s t m ov er adv ant age, an d ho w it c an do s o .

F igur e 2.3 SW OT Ana l ys is . T hi nk of a wel l- k nown prod uc t and its pos s i ble weak nes s es an d threats . Th en c o ns ider its s tr engt hs and oppor t un iti es .

Note: An ex am ple of a s tr ategic w in dow: Dur in g th e ex te nde d per io d wh en H P a nd Comp aq s tr ug gl ed t o c ompl ete t he ir mer g er, Del l Co mpu ter aggres s iv e ly c our ted Comp aq ’s larg e c orpor ate c us to mer s tr y ing to lev er age


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 29 29 eting S tr k eti ng ateg ies s nd do pr ic e c om par is ons and s witc h to a b etter s u t pp l ier r ii i. Barga in ing po wer of s upp li ers — is inf lu enc ed a b y th e num ber and s i ze of s uppl ie r s t iv. T he thr eat of s ubs ti tute pro duc ts —c an b e e ith er pr e od u c ts f r om a c om peting f ir m or indus tr y g v. Riv alr y am ong c om petitors — al l th e a bo ve f our f y ac tors inf lue nc e ri va lr y a d. Is s ues s uc h as c os t and dif f erentiat ion or l ac k of diff erent i s ati on of produc ts — a lo ng with the In ternet — inf lu enc e t he c s tr at e gies t hat c om panies us e to s t and out f r om their c om u petitors . s t 3. F ir s t m over and s ec on d m over s tr ate gi es o a. A f ir s t m over s tr ateg y ad vo c ates that a c om pan y t hat i s f ir s t to m of f er a produc t wi ll be t he lo ng- term m ark et win ner . Bei ng f e ir s t m a y als o ref er to enter ing ne w m ark ets wit h ex is t ing r prod u c ts or c r eating s ig nif ic ant in no vat i ons tha t ef f ec tive s l y turn an old prod uc t into a n e w o ne . c b. A s ec ond m over s tr ateg y a dvoc a tes c los e obs er vat ion a of the inn ov ati ons of f ir s t m overs and t hen im provin g o n n th e m to gain m ark et advanta ge e a 4. SW OT anal ys is a. SW OT anal ys is he lps p lan ner s c om par e inter na l orga ni zat s ion al s tr engths a nd weak nes s es with ex terna l o pport un iti es i and t hreats . l y b. “ SW OT ” is an ac r on ym f or s tr engths , w eak nes s es , o p por tun iti es f , i and t hreats . n c. T his is an im por tant s tr at eg ic pl ann ing d too l . d. SW OT – s tr engths a i. A s et of c ore c om petenc i es — what the orga ni zat io n l do es wel l t ii. Cor e c om petenc ies ar e c ap abi lit ies t hat c us tom ers e val ue and c om petit ors f ind dif f ic ul t to d up lic at e . r n ii i. Matc hi ng an int erna l s tr eng th wi th a n ex tern al op a por tu nit y produc es a s itu ati on k no wn as le vera ge . t e. SW OT – we ak nes s es e i. En vir o nm ental thr e ats c an attac k an orga ni zat ion ’s s weak nes s es . u ii. Pla nn ers m us t antic ipat e c ons tr ain ts whe n i nter n al p weak nes s es or lim itati ons p r even t th eir or gan i zati p on f r o m tak ing ad va ntag e of op por t unit ies . l i 5. Str ate gic wind o w e a. T he s tr ategic wind o w r ef ers to th e l im ited per iods whe n k e y r r equir em ents of a m ark et and th e p artic u lar c om peten c ies s of a f irm bes t f it to geth er . a


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 30 30 eting S tr k eti ng ateg ies r elate pot ent ia l o pport uni tie s to a f ir m ’s c apabil iti es .

b . T h e v i e w t h r o u g h a s t r a t e g i c w i n d o w s h o w s p l a n n e r s a w a y t o

c. It requ ir es a t hor o ugh ana l ys is of thr ee e lem ents : i. Cur r ent a nd proj ec ted ex ter nal en vir o nm ental c on dit io n s ii. Cur r ent a nd proj ec ted int ernal c om pan y c apa bi lit ies ii i. Ho w, wheth er , a nd when th e f irm c an r ec onc il e env ir onm ental c ond it ions a nd c om pan y c a pab il iti es in order to im plem ent one of the s tr ate gies


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 31 31 eting S tr k eti ng ateg ies

As se ssmen t chec k qu est i o n s 1. Br ief l y ex pl ain eac h of P orter ’s Fi ve F orc es . Porter ’s Fiv e For c es are t he t hreats of po t ent ia l n ew e ntrants , w hic h inc r eas es c om pet iti on in a mar k et; bar g ai nin g power o f buy ers , whic h c a n depres s pric es ; bar g ain in g power of s up pl iers , wh ic h c an inc r e as e c os t or r ed uc e s elec t ion ; thr e at o f s ubs ti t ute pro duc ts , wh ic h c a n l ure c us tomers to other produc t s ; and r iv a lr y am ong c omp etit ors , whic h c a n br ing ab o ut pric e war s or div ert c o mpa nies fro m th eir mai n g oa ls . 2. W hat ar e the b enef its a n d dr a wb ac k s of a f ir s t m over s tr ateg y? T he be nef its of a fir s t mov er s tr at egy i nc lud e c apturin g th e gr e ates t ma r k et s har e and dev e lop in g lon g- term r e lat ions hips w ith c us tomers . D is adv ant ages inc l ude the pos s ib il ity th at c ompan ies t hat f ol low c an l ear n fr o m m is tak es by f ir s t mov ers . Vir g in G alac t ic hopes t o b e a f ir s t mov er in the c o mmerc i al s p ac e tr av el ind us tr y . 3. W hat ar e the f our c om ponents of th e SW OT anal ys i s ? W hat is a s tr ateg ic wind o w? SW O T analy s is h elps p la nners c om par e int e r nal or gan i zati on al s tr en gth s and w eak nes s es w ith ex ter nal opp ortun it ies an d thr eat s . Ch apt er O b je ctiv e 5: SW IdenOt Tif isy an t h ac e br asic men s of a ,mar ketnes ingsstr ony mele f or s tr tengths w eak es ateg , o p y. por tun iti es , a nd t Ke y T erms: m ark eting hreats m ix , pr oduc t, prod uc t s tr ateg y, dis tr ib uti on s tr at , pr nom . A s tr ateg ic wi ndow def in es the lim ite d p erioeg ds ywhe th otion e k e sy r tr ateg y, pric s tr ateg equirinegmen ts of ya mar k et and a fir m ’s p artic u lar c ompet enc i es bes t f it t oget her . Po w erPo int Bas ic: 1 3, 1 4 Po w erPo int E xpan d ed: 18 - 26 1. Elem ents of a m ark eting s tr ateg y a. An ef f ec tive m ark eting s tr at eg y do es s ever al t hi ngs : i. It reac hes t he r i ght bu yers at th e rig ht t im e ii. It pers ua des th em to bu y th e pr od Note: As k s tude nts uc t to c ompar e prod uc ts of a c ompany ai ii i. It de ve lops a s tr ong r ela tio ns hip wit h th em over med at diff erent t tim e b. T he bas ic el em ents of a m ark eting s tr ateg y c o ns arget mar k ets , i n is t of two terms of the m ark eti c onc epts ng m ix v ariab les . Y : ou c o ul d c ons ider i. the t arget m ark et auto mob i les , ii. the m ark eting m ix varia bl es that c om bine to s at is f c omput ers , and mo y the needs of the targ et m ark et bi le phon es as ex a 2. T he tar get m ark et mpl es . F or ins ta nc e, a. T he tar get m ark et is a gro u p of c ons um ers toward who m the netb ook s , la pto ps f irm aim s its m ark eting ef f orts , and u ltim atel y its go ods an for s tudents , and la d s ervic es . pto ps for bus i nes s c oul d b. Div ers it y p la ys an ev er - inc r eas in g rol e i n targ et ing m ark ets b e c ompar e d. . Mar k eting in a Di git al W or ld: Add ing S oc ia l Med ia t o Your Mar k eting Str ate g y. As k s tudents w hic h c ompan ies and produc ts c an ben

i. T he Chin es e an d S out h As i an p opu lat ions are b ec om ing inf lue nti al t arget m ark ets in Cana da. ii. T argeting c o ns um ers in s pec if ic glo bal m ark ets als o r epr es ents a c h al le nge —an d an opp ortun it y 3. Mar k eting m ix varia bl es a. Mar k eting d ec is io ns c an be di vi ded int o s e vera l v aria bl es o r s tr ategi es that f orm the tota l pac k age, c a lle d th e m


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 31 31 eting S tr k eti ng ateg ies .


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 30 30 eting S tr k eti ng ateg ies a. T he term produc t m eans m ore tha n a go od, s er vic e, or ide a — it r ef ers to a broad c onc ep t th at a ls o enc om pas s es the s atis f ac tion of all c o ns um er needs in r el atio n to a g ood , s erv ic e, or ide a . b. So pr oduc t s tr at eg y i nv ol ve s m ore than j us t d ec id in g what g oods or s ervic es t he f ir m s hould of f er to c ons um er gr oups .

F igur e 2.4 El em ents of a Mark eting Str a teg y and I ts En vir onm ental F r am ework . Dis c us s how e ac h s tr ate gy r eac hes , pers u ades , and dev el ops a r elat ions h ip wit h buy ers .

c. It als o inc lud es dec is i ons c onc erni ng c us tom er s ervic e , pac k age des ig n, bra nd nam es , trade m ark s , patents , warr a nti es , the lif e c yc le of a produc t, prod uc t po s it ion ing , an d n e w- prod u c t dev el opm ent . 5. Dis tr ibu ti on s tr ate g y a. T he c onc ept of dis tr i but ion s tr ateg y r ef ers to the wa ys m ark eters ens ure th at c o ns um ers f ind produc ts i n th e pr o per q ua ntit ies at the r ight t im es and p lac es . b. Dis tr ibu ti on d ec is io ns in vo l ve : i. Modes of t r ans por tat io n ii. W ar ehous ing ii i. Inv entor y c ontr ol iv. O r der proc es s ing v. Sel ec tio n of m ark eting c ha nne ls inc l ud ing in term ediari es c. T ec hnolog y h as op ene d up ne w c h ann els of dis tr ibut io n in m an y ind us tr ies ( an ex am ple is o nli ne s e ll ing) . T he Intern et has c aus ed the b ig ges t re vo lut ion in dis tr ibut ion s inc e the m ail - ord er c atalo gue . 6. Pr om otion s tr ate g y

Note: As k s tude nts for ex amp les of c ompan ies t hat f orme d all ia nc es as a dis tr ib uti on s tr at egy .

a. Pr om otion s tr ate g y r ef ers to the c om m unic ations l ink bet we en s ellers a nd bu yers . b. In de ve lo pin g a prom otion s tr ateg y, m ark eter s blend t he vario us elem ents of prom otion to c om m unic ate m os t eff ec tive l y wi th t he ir target m ark ets . c. Integr a ted m ark eting c om munic at io n ( IMC) c o ordi nates al l prom otional ac ti vi ti es s o th at th e c ons um er r ec eives a unif ie d a nd c ons is tent m es s age . 7. Pr ic in g s tr ate g y a. Pr ic in g s tr ate g y de als with t he m ethod s of s etti ng prof it abl e an d j us tif iable pric es . b. It is c los e l y r egu la ted and s ubj ec t to c o ns ider abl e p ubl i c s c r utin y . c. O ne f ac tor that inf lu enc es a m ark eter ’s pric ing s tr ate g y is c om petiti on . d. A go od pric in g s tr ate g y s ho uld c r ea te va lue f or c us tom ers , bui ld in g and s tr en gth en ing the ir r el a tions h ip wit h a f ir m and its produc t . As se ssmen t chec k qu est i o n s


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 31 31 eting S tr k eti ng ateg ies 1. W hat ar e the t wo c om ponents of e ver y m ark

eting s t r ateg y? T h e b as ic el em ent s of a mar k eti ng s tr at egy are ( 1) the t arget mar k et a nd ( 2 ) the m ark etin g m ix v ariab les . 2. Id ent if y the f our s tr ateg ic elem ents of the m ark eting m ix . T he mar k etin g m ix c ons is ts of pro duc t, d is tr ib u tion , pr o mot ion, an d pr ic e s tr ateg ies .

Ch apt er O b je ctiv e 6: De s cribe t h e env iro n men t al c h aract e risti cs t h at in f luen ce str ateg ic d eci sion s . K e y T erm: r ul e of thr ee


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 32 32 eting S tr k eti ng ateg ies

Po w erPo int Bas ic: 15 Po w erPo int E xpan d ed: 27 , 28 1. T he m ark eting e nv ir onm ent a. Mar k eting d ec is io ns are not m ade in a vac u um . 2. Mar k eter s m ak e dec is ions abou t tar g et m ark ets and m ark eting m ix vari ab les b y tak ing int o ac c ount the d yn am ic nature of thes e f iv e dim ens ions of the m ark eting en vir o nm ent: a. Com petiti ve b. Pol it ic al- l ega l c. Ec onom ic d. T ec hnolog ic al e. Soc ia l- c ult ural f ac tors 3. Som e rec ent tren ds in the m ark eting env ir onm ent: a. Ex pan di ng into f oreign m ark ets b. T ec hnolog y— es pec ia ll y t he Intern et c. Mar k eter s are no w inc r eas i ng ef f orts to get t he ir m es sages to c ons um ers via s m artphone . d. T he r ule of thr ee m eans that i n an y ind us tr y, t he t hree s tr onges t, m os t eff ic ient c om panies d om inate bet wee n 7 0 an d 9 0 perc ent of the m ark et. e. T he im por tanc e of under s ta ndi ng pr ev ai lin g c ul tura l nor m s — bid din g f or auc ti on is an ex am ple f. T he entir e m ark eting en vir o nm ent pr ovi des a f r am ewor k f or all m ark eting ac tiv it y. As se ssmen t chec k qu est i o n s 1. W hat ar e the f iv e d im ensions of th e m ark eting en v ir onm ent? T he f iv e dim ens i ons of the mar k et in g env ir o nm ent are c om pet it iv e, p ol itic a l - le ga l, ec onom ic , tec hno log ic al , a nd s oc i al- c ult tors .t h e met h o d s fo r m a rket ing plan n ing , includ in g bu siness Ch apt er O b je cti v e 7:ural De fac s cribe po rt f o lio anal ys is , t h e BCG mat2.rHo ix ,wand h e ern st roateg ic eg natura ro w t lheonv p ir p onm o rt uent n itafyf mat rixth . e ot her d im is ctonc ver th ec ting ens ions ? Conc erns ov er t he n atur a l env ir on men t hav e l ed t o sne, m w ark and t i Ke y T erms : s tr at egic bus in es s unit ( SBU) , s tars , c as h c ows , ques t ion m ark s , dog ghter rpm e gu lat pr ions lutelion , wh ic hdiafvers fec ift th e pion oli tic a l - le gal env ir et penetr a ti on, mark et develo ent, od ou nc pol t dev opm ent, ic at onm ent in whic h mar k eter s o per at e. Effor ts to war d s us ta in ab il ity are no Po w erPo int Bas ic: 1 6- 18 w s oc ia l - c ult ural fac t ors as wel l b ec aus e c ons umer a war en es s is tur Po w erPo int E xpan d ed: 29 - 35 nin g i nto c o ns umer prefere nc e. 1. Meth od s f or m ark eting pla n nin g a. Man y f ir m s have de ve lop ed pla nn ing m ethods t o h elp with m ark eting dec is io ns . b. T hree of thes e t yp es of m ethods : t he s tr ate gic bus in es s unit c onc ept, t he m ark et s har e/ m ark et growth m atrix , and t he s tr ate gic gro wth opp ortun it y m atrix 2. Bus in es s por tf oli o a na l ys is


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 33 33 eting S tr k eti ng ateg ies .


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 32 32 eting S tr k eti ng ateg ies a. T op m anagers at large f irm s need a m ethod f or s pott in g pr od uc t lin es tha t des er ve m ore in v es tm ent as we ll as l ines t ha t ar en ’t l i vi ng up to ex pec ta tio ns . b. Portf oli o a nal ys is a ttem pts to e val uat e pr o duc ts an d de term ine the s tr onges t a nd weak es t. c. Str ate gic b us in es s units i. A s tr ate gic b us ines s u nit ( S BU) is a k e y bus i nes s el em ent with in a d iv ers if ied f ir m . ii. Eac h SBU has its o wn m anagers , res our c es , o bj ec ti ve s , and c om petitors . ii i. Div is io ns , pr o duc ts l ines , or ev en a s ing le prod uc t m a y c ons titut e a s tr at eg ic bus i n es s unit . F igur e 2.5 BCG Mar k et Shar e/ Mar k et G r owt h M atrix . T h ink of a pas t or pr es ent produc t or s erv ic e , a wel l- k nown bus in es s , or ev en a broad in dus tr y that mig ht f it i nto eac h quadr ant.

iv. An SBU , a ls o c al le d a c at e gor y, f oc us es att ent io n of c om pan y m anagers s o t hat the y c an r es p on d ef f ec tive l y to c hanges with in lim ited m ark ets . 3. Mar k et s har e/m ark et growt h m atrix ( BCG m atrix ) a. T he m ark et s har e/m ark et gr owt h m a tr ix ( or BCG m atrix ) plac es SBUs in a f our - quadr ant c h art that pl ots m ark et s har e —the per c enta ge of a m ark et that a f ir m c ontr ols —a gai ns t m ark et growt h pote nti al. b. T he quadr a nts are lab e l led s tars , c as h c ows , ques t ion mar k s , and dogs . c. Eac h of th e f our qu adr an ts r equir es a un iq ue m ark etin g s tr ateg y . d. Stars : i. Stars r epr es e nt u nits with h igh m ark et s har es in hi gh g r owt h m ark ets . ii. T he y gen erate c ons id erab l e inc om e, but r equ ir e e ve n m ore c as h to f ina nc e f urther gr o wt h . e. Cas h c o ws : i. Cas h c o ws ha ve hi gh m ark et s har es i n l o w- gro wth m ark ets ii. F oc us is to m ainta in t his s t atus f or as lon g as pos s ib le ii i. T he bus ines s pro duc es s tr ong c as h f lo ws , wh ic h c ou l d be us ed to f inanc e gro wt h of o ther S BUs with hi gh p ote nti al f. Q ues tio n m ark s : i. Q ues tio n m ark s ac hieve lo w m ark et s har es in hi gh gr o wth m ark ets . ii. Mar k eter s m us t dec ide whe ther to c o nti nu e s upp orti ng thes e produc ts or b us in es s es . ii i. T he y r equ ir e m ore in ves tm ent t han the y g ener ate in c as h . iv. If a ques ti on m ark c annot b ec om e a s tar, the f ir m s hould p ul l out of th e m ark et and targ e t oth er m ar k ets with great er pote nti al.


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 33 33 eting S tr k eti ng ateg ies F igur e 2. 6 Ans of f ’s Str ate gic G r o wt h O pportun it y M atrix . T hink of a loc a l bus in es s and ex pl ain how it m ig ht att em pt to grow by fo ll owi ng eac h of thes e s tr ategic gr owth s tr ategi es .

g. Dogs : i. Dogs m anage lo w m ark et s har es in l o w - gro wt h m ark ets . ii. Sinc e the y prom is e poor f utur e, m ark eter s s hould c ons ider with dra wi ng f r om thes e m ark ets as quic k l y as p os s ibl e . 4. Str ate gic gro wth opp ortun it y m atrix i. Com panies ha ve f our s tr ategic gro wth opp ortun it ies , whic h in vol ve s om e c om binati on of pres ent or n e w pr oduc ts and pres ent or ne w m ark ets


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 34 34 eting S tr k eti ng ateg ies Mar k et penetr ati on in vol ves pres ent produc ts a nd pres ent m ark ets . ii. Mar k et dev elo pm ent in vo lv es pres ent produc ts b ut n e w m ark ets . ii i. Pr oduc t de ve lopm ent i nv ol ves n e w pro duc ts bu t pr es e nt m ark ets . iv. Div ers if ic atio n i nv ol ves n e w produc ts a nd ne w m ark ets As se ssmen t chec k qu est i o n s 1. W hat ar e SBUs ? Str at eg ic bus i nes s un its ( S BUs ) are k ey bus i nes s un its wit hi n div ers ifi ed fir ms . Eac h SB U has its own man agers , res our c es , ob jec tiv es , and c ompet itors . 2. Id ent if y the f our qua drant s in th e B CG m atrix . T he B CG matr ix lab els SBUs s tar s , c as h c ows , ques t ion mar k s , and do gs . St ars are th e pr oduc ts wi th h ig h m ark et s har es in hi gh - growt h m ark ets ; c as h c ows c om man d h igh mar k et s h ares in lo w - growth mar k ets ; q ues ti on mar k s ac hiev e low mar k et s har es in hi gh - growt h m ark ets ; and dogs m an age on ly low mar k et s har es in low - gro wt h mark ets . 3. Id ent if y the f our s tr ateg ic gro wth opp ortun it ies . T h e f our s tr ateg ic grow th opport un iti es inc l ude mar k e t pen etrat ion, mar k et dev e l opme nt, produc t dev e lop m ent, and div ers if ic ati on.

AN SWER S AN D TE AC HI NG NO TES TO CH AP TER EXER CI SES

Project s and Teamw ork Exerci ses 1. Choose one of t he f ollowing com panies, or select anot her one whose goods and ser vices ar e f am iliar t o you. O n your own or wit h a classm at e, f or m ulate a m ission st atem ent f or t hat company. T hen cr eate a list of obj ect ives t hat r ef lect your company’s m ission. a. Mark ’s W ork W earhouse b. Petr oCanada c. T im Hort ons d. Bell Canada W hen st udent s choose a company w hose goods and ser vices are f am iliar t o t hem and cr eat e a m ission st atem ent, t hey m ight start w it h com panies t hey par t i cularly adm ir e and check t heir w ebsit es f or mission st atem ent ideas. W hen form ulating a m ission st at ement, t hey should m ake sur e t hat t he company’s over all broad objectives are spelled out , it s philosophy is st ated, and it s intent ions are list ed in a clear - cut and str aight f orw ard w ay . 2. Using a f irst m over strateg y, Apple’s iPod, iPhone, and iPad have clear ly established t he lead in t heir m ark et s. Resear ch t he pr oducts of anot her f irm t hat pr oduces eit her a dig ital m usic player


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 35 35 eting S tr k eti ng ateg ies

or a sm art phone t o lear n about it s st r at eg y. How has a second m over st r at eg y benef it ed t he f ir m ? Has t he second m over f irm been able t o cat ch Apple in sales? St udent s should f ir st st udy Apple and it s st r at egies t o be leader s in innovative product s, and t hen t hey should r esear ch t he pr oducts of anot her f ir m t hat produces eit her a digit al m usic player or a sm ar t phone t o learn about it s str ategy . They m ust underst and t he benef its as w ell as the r isks involved in being a f ir st m over. They m ust r esearch t he sales pr ogr ess of t he second m over f irm s, and pr esent t he f indings.


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 36 36 eting S tr k eti ng ateg ies

3. Cr eat e a SW OT analysis f or your self , list ing your own per son al st r engths, weak nesses, opport unit ies, and t hr eat s. “ SW O T” st ands f or str engths, w eaknesses, opport unit ies, and t hreat —so a SWO T analysis looks at inter nal st r engt hs and weaknesses and com par es t hem w it h ext ernal opport unit ies and t hreat s. To cr eat e t heir ow n SWO T analysis, st udent s should begin by br ainst orm ing t he four categor ies and coming up w it h f our list s. Then t hey can r eview t he t r ait s t hey’ve list ed. They m ight st ar t w ith t he “ bad new s” f ir st by looking at t heir w eaknesses and t he t hr eat s out th ere t hat m ight t ake advant age of t hese. Point out t hat t hey can lim it t heir w eak t endencies by ant icipat ing w hat m ight hit t hem —ther eby pr otect ing t hemselves and r educing t he chance of out side f or ces hur t ing t hem . Next t hey can t urn t o t he “ good new s ” and look at t he posit ive side. W hat ar e t heir cor e compet encies (w hat are t hey good at) ? What opport unit ies do t hey see out t her e? Remind t hem t hat t hey can match one of t heir inter nal st r engt hs t o an oppor t unit y, cr eat ing some lever age for t hem selves. What ha ve t hey lear ned about t heir ow n qualit ies and shor t com ings in planning f or t heir f utur e t hrough SWO T?

4. W hen r ivals Samsung and Sony each unveiled t heir new 3D T Vs at a maj or electronics st ore, som e consumers couldn’t t ell the dif f er ence bet ween t he t wo. But t he f ir m ’s str ateg ies were very dif f er ent. Sony now hir es out side m anuf actur ing f irm s t o build its T Vs, st ating t hat t he m ove wil l help cut cost s and k eep t he com pany str ong . I n addit ion, Sony plans t o add “ Sony- uniq ue applications,” including I nter net cont ent and str eam ing Sony f ilms bef or e t heir DVD r elease. But Sam sung insist s on m anuf actur ing it s own T Vs, including it s own com puter chips. W it h a classm ate, r esearch t hese new of f ering s by bot h f ir ms and evaluat e t heir m ark et ing st r at eg y. W ho is t he t arget m ark et f or bot h of t hese T Vs? How does product , dist r ibut ion, prom otion, and pricing f it into each f irm ’s overall m ark eting strateg y? St udent s are expect ed t o under st and t he str ategies of Samsung and Sony. I n cr eat ing m arket ing st r at egies, a f ir m de cides t o dir ect it s eff ort s t ow ard a par t icular group of consum ers called a t ar get m arket . St udent s w ill need t o narr ow t heir m arketing st r at egy t o f it cer t ain specif ic groups of people, keeping in m ind dem ographics, geogr aphical locat ion, lif est yle, etc . The st r at egies of Sony and Sam sung w ould be dif f er ent; hence, st udents should underst and t he dif f er ences in their approach in dept h. Such an eff ort w ill help t hem get clarit y on t he concept s r elated t o t he element s of m arket ing st r at egy. 5. Use your librar y r esour ces or an I nt ernet sear ch eng ine t o collect inf ormation on one of t he f ollowing companies ( or select one of your own). I dentif y the f irm ’s t arg et m arket( s). Note t hat a larg e com pany m ig ht have m ore t han one t arg et m ark et. W rit e a brief pr oposal f o r a m arketing str ateg y t o r each t hat m ark et . a. Master Card b. Cost co c. Kia d. Lululemon At hletica I n cr eat ing m ar keting strategies, a f ir m decides t o dir ect it s eff ort s t ow ard a part icular gr oup of consumer s called a t ar get m ar ket. Student s w ill need t o nar r ow t heir m ar keting str ategy t o f it


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cer t ain specif ic groups of people, keeping in m ind dem ogr aphics, geogr aphical locat ion, lif est yle, etc. Remind t hem t hat t heir proposed m arketing st r ategy should have t hr ee element s— it should r each t he r ight buyer s at t he r ight t im e, persuade t hem t o buy t he product, and lead t o st r ong cust omer r elationships over t im e. Some possible t arget m arkets for t he given f irm s ar e suggested below , t hough the class w ill cert ainly com e up w it h addit ional ideas. a. Master Card—businesspeople, com pany leader s, young consumer s, baby boomer s, seniors b. Cost co —older f em ales, younger f em ales, young f am ilies, business purchasers c. Kia—baby boomer s, females, f ir st -t im e pur chasers d. Lululemon At hletica—w omen, athletes, young adult s , per sonal t r ainers


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6. W it h a classm ate, choose a com pany whose products you have purchased in t he past . Cr eat e t wo ads f or one of t he com pany’s product s ( or product lines) . O ne ad should f ocus on t he product it self —its f eat ur es, pack ag ing , or br and nam e. T h e second ad should f ocus on pricing. Pr esent your ads t o t he class f or discussion. W hich ad is m or e ef f ect ive f or t he pr oduct and why? Have st udent s shar e t he t w o ads cr eat ed f or a chosen com pany ’s products or product lines. Remind t hem t hat one ad should highlight t he pr oduct it self —in som e w ay st r essing it s f eat ur es, packaging, or brand nam e. How can t hey get t he w ord out on t he unique tr ait s of t his product ? What is unusual or eye - catching about t he pr oduct t hat can be played up in an ad? The second ad should f ocus on pr icing. How can price, value, qualit y, or ot her f eat ures be pr esent ed in a w ay t hat w ill encour age pot ent ial buyers t o not ice t he product and consider purchasing it ? Aft er t he dem onst rations, st art a class discussion on w hich ads w ere m ost effective in inf orm ing and persuading. 7. O n your own or wit h a classmat e, r esear ch a f irm t hat hasbeenaroundforalongtime,suchasFord, General Elect r ic, or DuPont . Use your r esearch to det er m ine t hewaysthattechnologyhaschangedthe marketingen vir onm ent for your f ir m. Pr esent your f inding s in class. St udent s can get quit e a bit of inform at ion fr om r esear ching a m at ure company and its evolut ion over t he year s. They should have come up w it h an out line of t echnological changes and developm ent of pr oduct s over t im e, or even a t im eline show ing t echnological advances and t heir impact on t he f ir m ’s m arketing over t he decades. A f ew suggest ions on t he f ir m s given based on quick searches of t heir w ebsit es: a. For d—t he Model T design, t he assem bly line, m ass product ion, t echnology f or t he Lincoln luxur y line, Mercury m id-priced division, Thunderbir d sport y line, event ually Ma zda, Ma zda, Jaguar , Land Rover , Aston Mart in, and Volvo, plus new er t echnology in f uel eff iciency and emissions has been incor por at ed in m any m odels, and new hybr id t echnology is seen in the For d Escape and Mercury Mariner. b. G eneral Elect r ic — Thom as Edison’s r evolutionar y incandescent elect r ic lamp, t he m oder n light bulb, t he f irst lamp f act ory, t he air plane engine and ear ly jet engin es, t he steam t urbine, t he X -r ay m achine, t he electr ic f an, electr ic t oast er, plastic f ilament s f or light bulbs, electr ical installations, heating and cooking devices including ear ly st oves and r efr iger ator s, t he TV set, w ashing m achines, laser light , f ib re opt ics, digit al t echnology, m agnet ic r esonance t her apy and ult r asound t echnology, and m uch much m or e. c. DuPont—chem icals and energy- based m at erials used in pr oducts and services f or m ar ket s in agr icult ure, nut r it ion, elect r onics, comm unications, saf ety and prot ection, hom e and const r uct ion, t r anspor t at ion and apparel, including m at erials such as cellophane, nylon, plastics, and t r adem arked goods such as Pioneer® br and seeds, Tef lon® f luor opolym ers, f ilm s, f abr ic prot ect ors, f iber s, and disper sions; Coria n® solid surf aces; Kevlar® high - st r engt h m ater ial, and Tyvek® prot ective m at erial. 8. Suppose you are a mark eter f or Canadian t oy m anuf act urer MEG A Br ands. T op execut ives at t he company have announced t heir ambit ion “t o be the choice of every f am ily around t he world. ” T hey want you t o look at t he m arket pot ent ial in I ndia in t he next f ive year s. W rit e a memo t o your m anag er expla ining how you t hink t he social - cult ur al envir onm ent m ay af f ect your f irm ’s m ark et ing st r at eg y in I ndia.


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As m ar keter f or a lar ge Ca nadian t oy m anuf actur er looking t o expand overseas and part icularly int o I ndia, you w ould w ant t o do some quick r esear ch. An I nt ernet sear ch shows m or e t han 800 t oy and gam e m anufact urer s w it hin t he countr y, plus t he compet it ion of three giant s —Mat t el Toys , Funskool, and Lego —w ho are t he biggest inter nat ional player s ther e. Apparent ly sof t t oys, com put er gam es, dolls, electr onic gam es are available, and not surpr isingly, kids w ant “ f un” t oys w hile par ent s pr efer “ educat ional ” t oys. Ask st udent s about t he re search t hey did on t he cult ural and social f act or s af f ect ing


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consumer behaviour and eventual pur chase decisions in t his nat ion, and how t hese elements im pact ed t heir m emo on a m arket ing str ategy. 9. Select one of t he f ollowing industr ies and r esearch which f irm s m ig ht f all into t he t op t hr ee in t he industr y, cr eat ing a r ule of t hree: a. f ast-f ood r est aur ant s b. upscale hot els c. elect r onics r et ailing d. aut o m anuf act ur ing The st udent s should select any industr y of t heir choice and pr ef erence f r om t he f our opt ions. They must r esearch t he var ious com panies in t he indust r y, bat t ling f or a higher m ar ket shar e. From t he f indings, t he t op t hree companies t hat have a m ar ket shar e t otaling 70 t o 90 per cent are t o be list ed. Few st udents can also explain t he r easons f or such dom inat ion by t hese big players of t he indust ry. 10. O n your own or wit h a classmat e, r esear ch one of t he f ollowing larg e corporat ions. Select several product lines and classify each in t he BCG m at r ix. a. Sears Canada b. Johnson & Johnson c. Conde Nast Publications d. G eneral Elect r ic (G E) St udent s m ust select any corpor ation fr om t he f our list ed out in t he t ext. Fr om t he available pr oduct lines, t hey should select at least 6 t o 8 and cat egori ze t hem into st ars, cash cows, quest ion m arks, and do gs. Their r esear ch should be accur at e enough t o classif y t he pr oduct lines into t he f our dist inct categor ies. St udent s can also graphically r epr esent t he pr oduct lines in t he f our quadrant s f or a bet t er r epr esentat ion of t heir f indings. Ther e should be a d iscussion over a f ew pr oduct lines t hat m ay f all in m ore t han one category. Cri ti cal- Thinking Exerci ses 1. Suppose you are a mark eter f or a Canadian manuf actur er of pet supplies. T wo t op execut ives have proposed expanding t he company by opening r etail st o r es and m arketing pet s on- sit e — puppies, k it t ens, r abbit s, bir ds, f ish, and the lik e. W hat are t he potent ial benef it s and dr awbacks of m ak ing a m ove lik e t his? How wou ld you advise your company t o pr oceed? A company’s st r engths reflect it s cor e compet encies —w hat it does w ell. They are capabilit ies t hat custom ers value and com pet it or s f ind diff icult t o duplicate. Str aying f r om core com pet encies m ay have pot ent ial r ew ar ds, such as expanding into more att r act ive m arket s, but is also r isky. O n t he other hand, even if a com pany f ocuses on its cor e com pet encies, som etimes it needs to br oaden it s off erings t o m aintain a compet it ive edge . The benef its could be bett er r each and cover age. Dr aw backs could be inabilit y of t he com pany to leverage t he decision. A compr ehen sive SWO T analysis can help t he t op m anagement t o t ake t he r ight decision. St udent s answ ers m ay vary. 2. Netf lix has m ade t housands of st r eam ing videos available t o its unlim it ed subscr iber s. How does t his st r at eg y dem onst r at e a st r at eg ic windo w f or t he co m pany?


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The view t hr ough a st r ategic w indow show s planner s a w ay t o r elate pot ential oppor t unit ies to company capabilit ies. Netf lix is in a unique posit ion because unlike pr evious leader s in t he m ovie r ent al business, it delivers m ovies and TV series dir ect ly t o PCs via t he I nt ernet . A new system intr oduced by t he com pany w ill allow t hem t o sidest ep com put ers and deliver m ovies dir ect ly t o t elevision sets. 3. Choose one of t he f ollowing products and descr ibe how it m ay ( or alr eady has) becom e vulner able t o subst it ut ion. T hen descr ibe an overall str ateg y —wit h t wo or t hree t actics—f or r educing t his vulner abilit y.


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a. pr inted copies of per iodicals or books b. t elevision c. t elephone landlines d. t r avel ag encies This exer cise asks st udents f or an opinion but sug gest s t hat st udents t hink about product s t hey use. Defending a pr oduct fr om com pet it ion m ight include adding f eat ures, delight ing cust omer s w it h bet t er service, im proving product qualit y, or low ering pr ices. 4. Resear ch t he websit e of one of t he f ollowing r et ail f irm s t o ident if y it s t arg et m ark et . T hen out line a st r at eg y f or expanding t hat t arg et m ark et. a. T im Hort ons b. Ar it zia c. Root s Canada d. Dollaram a St udent s m ay select any one of t hese r etail f irm s. The t arget gr oups m ust be clear ly def ined, expl ained, and a st r at egy t hat cat ers t o t hose gr oups m ust be out lined. I deas f or expanding t his t arget m arket m ust be f easible, and should be applicable t o t he curr ent envir onm ent . A discussion on how t o im prove the off er ings, and expand t he t ar get m ar kets, w ill help t he st udent s t o under stand t he concept in a better w ay. 5. Resear ch a com pany such as Molson Br eweri es or Kr af t Foods t hat has a num ber of dif f erent successf ul SBUs. W hat f actor s do you t hink m ak e t hese unit s —and t his com pany— successf ul f r om a m ark et ing st andpoint? St udent answers m ay var y. To evaluat e each of their organi zation ’s st r ategic business unit s, st udents could use t he m arket share/m arket gr ow t h m at r ix developed by t he Boston Consult ing G r oup. Discussion could also f ocus on how t he select ed com pany manages its SBUs.

Et hics Exerci ses Recent t ests by t he Canadian Food I nspect ion Ag ency f ound 4. 3 gram s of f at in a McDonald’s chick en f aj it a, advert ised as having 2.5 g r am s of f at ; 19. 4 g rams of f at in KFC chick en str ips, advert ised as having 12 g r am s of f at ; and 0. 7 g rams of tr ans f at —a f at t hat m any consum ers t r y t o avoid — in a Fresco sof t t aco, advert ised as having 0.2 g r am s of tr ans f at. Frozen diet m eals m ade by Lean Cuisine, W eig ht W atcher s, and Healt hy Choice, am ong ot her s, averag ed 8 per cent hig her in calories t han list ed on the pack ag e labels. Im ag ine t hat you are a m ark et er f or a f ood m anuf act urer that com pet es wit h t hese f ir m s. 1. Cr eat e an advert isement f or your f irm ’s f ood. Decide on a st r at eg y and t act ics. W ould you f ollow in t he footst eps of some of your com pet it ion or use accurat e f at and calorie counts? W ould you r ef er t o the st udy t hat f ound discr epancies in your com pet it ors’ num bers?


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The exer cise r aises some import ant issues and student s m ay come up w ith contr adict ing opinions . O n one hand, t he com pet it ors are gaining m ar ket shar e by such unethical pr act ices. O n t he other hand, beating com pet it ion w ould r equir e att r act ing consumer s using innovat ive, honest w ays. This exercise w ill put t he st udents in an ethical dilemm a, and give solutions t hat can beat compet it ion in eit her et hical or unethical w ays. Some student s m ay opt t o ignore t he st udies t hat have discr epancies in t he r esult s, w her eas, some m ight f ollow t hem .


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2. W ould you price your own f irm ’s f ood hig her or lower t han t he com pet it ion’s? W hy? St udent s can have diff ering opinions f or t his question. Some m ight pr ice the f ood higher, due t o t heir low calorie count. Som e m ight pr ice t he f ood item s low er t o att r act consum ers. The st udent s should just if y t heir solut ions and elabor ate t he r easons f or t he pricing str ategies used f or t he f ir m ’s f ood item s.

I nternet Exerci ses 1. Busi ness portf oli o anal ysis. O ccasionally, companies sell par t s of t hemselves t o ot her f ir m s. O ne st ated m ot ive f or such divestitur es is t hat t he sold assets ar e a poor str ateg ic f it f or t he r est of t heir business portf olios. One r ecent example is t he sale of a cont r olling inter est in NBC Universal by G ener al Electr ic t o cable g iant Com cast . Using a m aj or search eng ine, r esear ch t he sale of NBC Universal. I n t h e cont ext of business portf olio analys is, why did G E decide t o sell, and why did Com cast decide t o buy, NBC Universal? St udent answers w ill vary. St udent s are expect ed t o visit a f ew w ebsit es t hat pr ovide infor m at ion on business port f olio analysis, NBC Uni versal, Gener al Electr ic, and Comcast. The answ ers m ay include some of t he inform ation that f ollow s. NBC Universal is a m edia com pany — hom e t o a broadcast netw or k, m ovie st udio , and a st r ing of cable net w or ks —w hich is not a compet ency f or G ener al Electr ic. How ever, Comcast pr ovid es cable t elevision, broadband I nter net, and t elephone service to both r esidential and com m er cial custom ers . It m ay be in a bet t er posit ion t o handle NBC ’s operat ions. 2. M i ssi on and O bject i ves. Visit t he websit e of t he Sara Lee Corp or ation (htt p: // www. saralee. com), whose slog an is “ t he j oy of eat ing. " Def ine t he f irm ' s m ission and obj ect ives, and discuss how it s br and and act ivit ies support both. St udent answers m ay var y. The m ission st atem ent o f Sara Lee, “ To sim ply delight you…ever y day” suggest s t hat t he f irm aim s t o give it s customer s a unique experience ever y t im e t hey use it s pr oducts. The f irm ’s objectives can include f ast delivery of pr oducts, eff icient supply chain m anagem ent, and so on. 3. SWO T Anal ysis . Visit t he websit e of an org anization whose g oods and services int erest you — such as Lululemon At hletica, National Hock ey Leag ue, Travelocit y, Apple, or Amazon. ca. Based on your r esearch, cr eat e a SW OT analysis f or your f irm . O utline your own ideas for increasing t he f irm ’s str eng t hs and r educing it s weak nesses. St udent answers w ill vary accor ding t o t he product and industr y t hey choose. I n a SWO T analysis, t he st r engt hs of a f ir m are typically inter nal and ar e t he cor e com pet encies of the f irm , like eff icient supply chain m anagem ent, just -in- t im e invent ory syst em , and so on. The w eaknesses ar e int er nal, like lack of eff icient m anagem ent . The opport unit ies ar e usually exter nal, like t he changing custom er pref erences and t he econom ic sit uat i on. The t hr eat s w ould nor m ally include com pet it ors.


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Case 2. 1 “Food Fi ght ”—Q uest i ons f or Cri ti cal Thinking 1. I dentif y one g oal f or Pizza Pizza and one g oal f or Panag o Pizza. St udent s can suggest doze ns of goals, many of which could serve eit her compet it or . Make sur e t he goals t hey select ar e m easur able and t im e - bound. The f ollow ing are possible examples. a. Pi zza Pi zza - t o add tw o new desser t it ems by 2015 - t o incr ease sales r evenue by 6 per cent next year


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b. Panago Pi zza - t o open 30 new locat ions in At lant ic Canada by 2015 - t o intr oduce f our new wing f lavours w it hin tw o years 2. Descr ibe Pizza Pi zza’ s corpor ate st r at eg y f or growt h. Does it dif f er f r om Panag o Pizza ’s corporate g rowt h str ateg y? Explain . I t is obvious t hat bot h com panies ar e f ollow ing market developm ent ( Panago goes east, and Pi zza Pi zza goes w est) and a pr oduct developm ent ( new f lavours, new it em s) gr owt h str ategies. Less obvious, but w it hout doubt , bot h companies ar e involved in market penetr ation as w ell. Pi zza P i zza prev iously intr oduced “ t he slice ” as an att empt t o gr ow its sales; Panego has added its per sonal - si zed pi zza t o compet e. 3. If you were inter est ed in owning a f ast -f ood f r anchise t oday, would you pref er t o own a f r anchise of t he ent r enched brand or of the in vading brand? W hat f act ors would you consider when m ak ing your choice? St udent answers w ill vary, and som e w ill likely choose each option. Fact ors could include f r anchise f ees, growt h r ates, product assortm ents, and even personal pref er ences ( known and st a ble ver sus new and excit ing) . Case 2. 2 “St arbucks’ St rat egy: I t’ s a Smal l Worl d Af t er Al l ” —Q uest i ons f or Cri ti cal Thinking 1. Cr eat e a brief SW OT analysis f or St ar buck s , focusing on it s plans f or inter nat ional growt h. Do you t hink t his str ateg y is a g ood one f or t he com pany? W hy or why not ? Most st udent s w ill be able t o identify m any of St arbucks ’ st r engths, including a st r ong brand nam e and a w inning m ar keting str ategy. I t ’s per haps har der t o identify w eaknesses, but som e st udent s m ay question w het her t he company has t he f inancial r esour ces t o cont inue t o expand r apidly. O ppor t unit ies and threat s are bot h ident if iable and include high grow t h pot ential m arkets ( an opport unit y) , local t ast es and pref er ences ( a possible threat) , pot ent ial m ar ket satur at ion ( a possible t hreat), and compet it ion ( a t hr eat) . W hile t her e m ay be some dissent er s, a m ajority of st udents w ill likely argue t hat St arbucks ’ inter national growt h str ategy is sound. 2. I dentif y t he dim ensions of t he mark et ing envir onm ent t hat ar e m ost lik e ly t o af f ect St ar buck s’ strateg y f or g lobal growt h and explain wh y. St udent s should ident ify t he econom ic ( consum er dem and m ay be sensit ive t o econom ic condit ions) , socio - cult ural (w ill t he Starbucks business m odel and br and appeal t o people out side t he U nit ed States and Canada?) , and possible legal ( w ill f oreign governm ent s r est r ict St ar bucks ’ expansion into t heir m arket s ?) dim ensions as having t he great est pot ential im pact on t he f irm ’s st r at egy f or global growth. Vi deo Case Synopsi s “St rat egi c Pl anning and t he M arketi ng Process at Preserve” —Q uesti ons f or Cri ti cal Thinking


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1. Do you consider Preserve' s st r at eg y f or t he Preser ve br and a f ir st m over or second m over str ateg y? Expla in. I f view ed as a m ere r ecycling company, Pr eserve is utili zing a second m o ver st r at egy —t he company is im proving upon prior f irst- m over r ecycling businesses. How ever , if t hought of as a r ecycled product s company, Pr eserve is using a f irst m over str ategy, f or t he com pany is a pioneer in t r ansf orm ing r ecycled m ater ial into new cons um er- goods pr oduct s. I nt er estingly, by par t icipat ing in t he com pany's recycling program , Pr eser ve custom ers act ually supply t he r aw m at erials t hat ar e t r ansform ed int o Preserve brand products dur ing m anuf act uring. Eco -m inded consumer s have show n gr eat inte r est in seeing t heir used plastics tr ansf orm ed into new pr oduct s.


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 48 48 eting S tr k eti ng ateg ies

2. Perf orm a SW OT analysis on Pr eser ve . I dent if y t heir cor e com pet ency and t heir weak nesses in t he m ark et place. A SW O T analysis com par es a f irm 's inter nal or gani zational st r engths and w eakne sses w it h exter nal oppor t unit ies and t hreat s. Pr eserve' s str engths: a compelling " green st ory" ; t he abilit y t o m ake high - qualit y eco-f r iendly pr oducts at compet it ive pr ice points; dist r ibut ion t hr ough W hole Foods and Trader Joe' s; st r ong r elationship m ar ke t ing w it h gr een cust omer s via I nt ernet and e m ail. Pr eserve' s w eaknesses: lim it ed advert ising and prom otions budget; lim it ed r ange of m ater ials t hat can be r ecycled f or use in Pr eserve br and pr oduct s; r elat ively unknow n sm all business. Market opport unit ies: popular " green product s" tr end; gr ow ing netw ork of gr een supply chain part ners. Market t hr eat s: large compet it ors in personal-care pr oduct m arket ; potent ially f addish nat ure of green m arket ing. St udent s' answ ers about Pr eser ve's core com pet ency w ill vary, but t he com pany's abilit y t o m ake aff ordable, high - qualit y , 100 per cent r ecycled product s is a sm all niche and is diff icult f or ot her companies t o duplicate.

CO LL ABO R ATI VE LE ARNI NG EXERCI SES Pl anning Throughout the Organi zat i on Purpose: T o hig hlig ht a k ey challeng e in g ather ing inf or m ation f or str ateg ic planning Backgr ound: Research clear ly st ates that when your ent ir e organization g ather s and shares inf or mation, t he planningprocessismoreeffectiveandbetter int eg rated into t he org anizational cult ur e. But the bestwaytoachievefullemployeepart icipat ion is m uch less clear . T his exercise is designedto helpstudentsexplorepotential approaches t o achieve m ore widespread inf orm ation shar ing . Relationship t o T ext : Planning at Dif f er ent O rganizatio nal Le vels Est im ated Class T ime: About 10 t o15 m inut es Pr eparat ion/ Mater ials None needed Exercise: Ask your class why t hey t hink it is so dif f icult t o achieve a f r ee f low of inf orm ation and ideas in m ost com panies. As t hey shar e t heir t houg hts, you m ay want t o point out t hat m oney isn’t always t he answer; in f act, of f er ing m oney in exchang e for ideas can spawn a count erpr oductive, compet it ive dynam ic among em ployees at all levels. Ir onically, t echnology doesn’t alwa ys help eit her . Joseph Pr iestley, a pioneer of m odern science, summ ed up a comm on issue by observing , “ T he m ore elaborat e our m eans of comm unication, t he less we com m unicat e.”


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 49 49 eting S tr k eti ng ateg ies

Af t er a br ief discussion, break your class int o small t eam s and g ive about f ive m inut es t o brainstorm possible solu tions. W hen you r econvene as a class, ask each g roup t o shar e t heir best idea ( possibilit ies usually r ang e f r om host ing week ly planning lunches wit h all employees, t o eng ag ing I ntr anet approaches, t o r aising overall pay) . T his of t en leads t o a helpf ul and spontaneous discussion about which m ethod work s best in which situat ion, and why. Q uest ions f or Ref lect ion: How does planning connect t o cor por at e cult ure?


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 50 50 eting S tr k eti ng ateg ies

I s em ployee par t icipat ion lik ely t o become m or e or less im port ant as our economy evolves? W hy? Defi ning t he O rganization’ s M i ssi on and O bject i ves Purpose: T o g ive st udent s a per sonal per spect ive on m ission st at ement s Backgr ound: T his exercise is desig ned t o explore and ar t iculate t heir per sonal “m ission st at ement s. ” T ypicall y it is bot h int erest ing and inspir ing , and helps st udent s under st and how org anizations use t heir m ission st at em ent s t o dif f erent iate t hemselves and t o g uide t heir decision -m ak ing at a m or e visceral leve l. Relationship t o T ext : Def ining t he O rg anization’s Mission and O bj ect ives Est im ated Class T ime: About 10 m inut es Pr eparat ion/ Mater ials: Each st udent will need paper and a pencil or pen. Exercise: Ask each st udent t o spend a f ew m oment s wr it ing a per sonal m ission st atement f or his or her lif e. For t he discussion t o be ef f ect ive, avoid pr oviding m any cues. You can let t he discussion prog r ess on it s own and inter vene t o provide a direction when st udent s g et st uck. Af t er about f ive m inut es, ask f or volunt eer s t o shar e t heir st at em ents. If no one volunt eers, st ar t by calling on a f ew people who t end t o be art iculate in class. T he r esult s can be stagg ering. And t he discussion is t ypicall y spontaneous and livel y—but if not, ask student s t o ident if y sim ilarities and dif f er ences in t heir st atem ent s, possibly across g ender , ag e, hom eto wn, colleg e m aj or , or ot her dem ographic t r ait s and lif est yle char act eristics. W hat do t heir statem ent s say about et hics, values, and locus of cont r ol? How do t heir per sonal m issions inf luence t heir actions and decisions on a day - to- day basis? You m ay want t o close by calling t heir at t ention t o t he obvious par allels bet ween per sonal and org anizational m issions. Q uest ions f or Ref lect ion: W hat are t he char act er ist ics of a str ong m ission st atem ent ? ( You m ig ht want t o pr ecede t his q uest ion wit h som e examples of cor por at e m ission st at ement s. Som e possibilit ies: Merck —t o preserve and im prove hum an lif e; Mary Kay—t o give unlim it ed oppor t unit ies f or women .) Ext end t he exercise by ask ing each st udent t o do a per sonal SW OT analysis, t he log ical next st ep in str ateg ic planning.


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 51 51 eting S tr k eti ng ateg ies

St rat egi c Pl anning Purpose: T o g ive your st udents hands - on exper ience wit h basic str ateg ic planning f or a very f am iliar ent it y— t hemselves! Backgr ound: At t em pting t o im plement st r at eg ic planning, st udents of t en st r ugg le t o f ind t he balance bet ween an approach t hat ’s t oo narr ow and an appr oach that ’s t oo broad. T his exercise is desig ned t o help st udent s achieve t he r ig ht balance by examining their per sonal str ateg ic plans and zeroing in on


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 52 52 eting S tr k eti ng ateg ies

bot h wide- r ang e and detailed issues ( while r eceiving som e unexpect ed g uidance f r om t heir peer s about t heir car eers). Relationship t o T ext : St r ateg ic Planning Est im ated Class T ime: About 15 m inut es Pr eparat ion/ Mater ials: Each st udent will need paper and a pencil or pen Exercise: Ask st udent s t o wr it e down a brief st r at eg ic m ission st at ement f or t heir career s, look ing at t he f ive - year hor izon. From a prof essional st andpoint , what do t hey aspir e t o be ? Collect t he paper s, shuf f le t hem , and r edistr ibut e t hem t o t he class. Ask each st udent t o wr it e a f ive - point st r at eg ic plan f or t he person whose paper he or she r eceived. Each point in t he plan should be no m ore t han a sent ence or t wo. Remind t he class t o be sure t hat all of t heir points are specif ic and m easurable, and m ost im port ant ly, will bring t he st uden t closer t o t he overall st r at eg ic g oal. Af t er about t en m inut es, call on a handf ul of st udent s and ask t hem t o shar e t heir classmat e’s g oal and t he f ive - st ep plan t hat t hey cr eat ed. Q uest ions f or Ref lect ion: W as it easy or har d t o wr it e t he plan? W hy? Where did t hey have pr oblems? How could a st r at eg ic plan help develop your career ? W hy? How does develop ing a per sonal st r at eg ic plan compare t o developing a business str ateg ic plan? Form ulat i ng a M arket i ng Str at egy Purpose: T o help st udents explore str ateg ic solutions f or a cont empor ary m ark et ing issue Backgr ound: Not sur prising ly, f ast -f ood r est aur ant s ar e f eeling under sieg e. Recent st udies ar e hig hlig ht ing healt h hazards acr oss Canada and cit ing r am pant obesit y, child obesit y, the dang ers of tr ans f at s, and m or e. As low- carb diets becam e popular, r et ail sales of f r ench f r ies —a st aple of f ast -f ood r estaur ant s—plumm eted, dr opping 2.9 percent in 2001, 3. 3 per cent in 2002, and 10 per cent in 2003 ( www. wh ybiotech. co m ). Fr om a PR per spect ive, t he 2004 docum entary Super Si ze Me f anned t he f lam es. T his exercise is desig ned t o help st udents explore potent ial solutions —and ethical im plications—f or this str ateg ic challeng e f rom t he f ast -f ood industr y per spect ive. Relationship t o T ext : For m ulating, I m plem ent ing, and Monit oring a Mark et ing Str ateg y


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 53 53 eting S tr k eti ng ateg ies

Est im ated Class T ime: About 20 t o 25 m inut es Pr eparat ion/ Mater ials: You m ay want t o copy t he backg r ound and t he case situat ion f or each st udent .


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 54 54 eting S tr k eti ng ateg ies

Exercise: Divide your cla ss into small g r oups and shar e wit h t hem t he f ollowing case. Sit uat ion : You and your t eamm at es ar e par tner s in t he owner ship of a m edium - sized f ast -f ood chain. You own 41 out lets, m ost of t hem in sm all t owns. T he m ainst ay of your m enu is ham bur ger s and f r e nch f r ies, alt houg h you also of f er a couple of sandwiches, chips, sof t - serve ice cr eam , and dr ink s of various t ypes . Your m ost im port ant cust om ers are m en aged 18 t o 34 (t hey account f or about 20 per cent of your cust om ers and about 55 per cent of your sales ) , but since r est aur ant opt ions are lim it ed in m ost of t he t owns wher e you operat e, you serve custom er s across a wide dem og r aphic r ang e. Sales in t he past t wo year s have been dropping at an acceler ating r ate . You have t o m eet wit h your par t ner s t o discuss pot ent ial solutions. G ive your class about 10 m inut es t o br ainstor m opt ions. Encourag e t hem t o consider all t he possibilit ies including doing not hing (“T his will all blo w over ….” ). T hen, dir ect each g r oup t o choose t heir best opt ion, and t o ident if y t he p otent ial r isk s and benef it s (e.g., if t hey m ade chang es t o att r act new custom er s, will t hey alienate t heir cur r ent custom ers?) . Reconvene as a class, and ask each g r oup t o r epor t brief ly to t heir peers. W hich solution does t he class lik e best ? W hy? Q uest ions f or Ref lect ion: W hat addit ional inf orm ation do you need t o f or m ulate t he best solution? W hat are t he ethical implications of each choice? Should your per sonal per spect ive play a r ole in your st r at eg ic decision m ak ing ? W hy or why not ? ( You m ay want t o pr ef ace t his q uest ion by ask ing how m any of your st udent s eat f ast f ood m ore t han once a week. ) Promoti on St rat egy and Pri ci ng St rat egy Purpose: T o explore t he r elationship bet ween t he pr omot ional and pr icing st r at eg ies Backgr ound: Clear ly, all element s of the m ark eting m ix are interr elated, so t his exercise is desig ned t o hig hlig ht t he link s bet ween pr omotion and pr icing Relationship t o T ext : Pr omot ion Str ateg y and Pr icing St r at eg y Est im ated Class T ime: About 15 m inut es Pr eparat ion/ Mater ials: Each st udent needs t o have unlined paper and a pencil or pen Exercise*: Br eak your class into small g r oups. Ask each group t o choose a g ood or a service t hat t hey all k now and lik e, and t o cr eate t wo ads f or t hat product: one t hat f ocuses on price, t he ot her on t he f eat ur es and benef it s of the product itself . (T hey can do pr int, r adio, T V, or I nter


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 55 55 eting S tr k eti ng ateg ies

net ads, as long as bot h ads are desig ned f or t he sam e m edia.) Let t hem k now upf r ont t hat t hey’ll need t o pr esent t heir ads t o t he class. W hen t he t eam s present t hei r ads, conduct a q uick vote t o see which ad t he class lik ed bett er f or each pr oduct . Keep a t ally on t he board showing each of t he product s and t he winning t ype of ad. Result s will vary sig nif icant ly based on t he pr oduct categ ories ( and, of cour se, t he cr e ativit y of the st udent s). Follow- up discussion can be inter est ing, surpr ising, and f un. W hat t ype of ads work ed best , and why? Ho w did t he product categ or y and pr ice af f ect t he prom ot ional str ateg y? Does t he broader m arket ref lect t he f indings of t he class ? W hy or why not ?


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 56 56 eting S tr k eti ng ateg ies

Q uest ions f or Ref lect ion: W hat f act ors should a com pany consider when develop ing t heir pr icing str at eg ies? W hat about t heir prom ot ional st r at eg ies? W hy? *T his exercise was adapted f r om t he t ext. The M arketi ng Envi ronment Purpose: To hig hlig ht t he im port ance of t he m ark et ing envir onm ent Backgr ound: T his q uick, discussion- based exercise is desig ned t o help st udent s bett er under st and t he im pact of t he ext ernal envir onment on m ark eting decisions Relationship t o T ext : T he Mark eting Envir onm ent Est im ated Class T ime: About 10 m inut es Mater ials/ Pr eparat ion: None needed Exercise: Choose a br anded pr oduct t hat your st udent s seem t o all k now and enj oy. Hig her - end product s, such as an Apple iPad or a Burt on snowboard , seem t o work especia lly we ll f or t his exercise. G uide your st udents in a discussion of how each element of t he ext ernal envir onm ent — compet it ive, polit ical- legal, econom ic, t echnolog ical, and social - cult ural—could inf luence t he success of t heir product over t he next f ive year s . Encourag e t hem t o consider f actor s beyond t he obvious ( e.g ., t he em erg ing developm ent of year -round snow- m ak ers, or vi r t ual r ealit y snowboarding g ames). As you develop your list , you m ay want t o also r emind t hem t hat a m ark et er cannot cont r ol the ext erna l envir onm ent, but he or she m ust r espond t o it ef f ect ively. Q uest ions f or Ref lect ion: W hich element of t he m ark eting envir onm ent is most im port ant ? W hy? W ould t he answer be dif f erent f or dif f erent pr oduct cat eg ories? W hich element s have t he m ost im pact o n a m arketer ’s day-to- day decision - m ak ing ? W hich element s are lik ely t o g ener ate surpr ises? ( You m ay want t o point out how m any companies were surpr ised by t he bur st ing of t he “ dot - com ” bubble in t he 1990s.) W hat are ef f ective ways t o m onit or t he m ark et ing envir onm ent on an ong oing basis? BCG M at ri x Purpose:


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 57 57 eting S tr k eti ng ateg ies

T o help st udents g ain a fuller under st anding of t he BCG m at r ix as a planning t ool Backgr ound: W hile t he concept of t he BCG m atr ix is st r aig htf orward, m any st udent s have tr ouble under st anding how it a pplies t o act ual sit uat ions as an investm ent t ool. This exercise is desig ned t o f oster a deeper underst anding t hr oug h a hands - on case st udy approach. Relationship t o T ext :


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 58 58 eting S tr k eti ng ateg ies

BCG Matr ix Est im ated Class T ime: About 25 m inut es Mater ials/ Pr eparat ion: None n eeded Exercise: Announce t o your class that t hey wi ll do a case study on t he t alent ag ency business ( which m ost of t hem wil l f ind m or e g lam orous and excit ing t han it r eally is) . Beg in by brainstor m ing a list of m ovie st ars, celebr it ies, and ent er t ainer s. Encourag e t he class t o include a wide variet y, f r om curr ent box of f ice dr aws, t o over - t he- hill t alent s, to em erg ing st ars. T hen, divide your st udents into sm all g r oups and t ell t hem t hat each g r oup r epr esent s a sm all t alent ag ency. T heir list includes t he st ars that you list ed on t he board. G ive t hem each a hypot het ical $10 million t o invest in m ark et ing t he per sonalit ies in t heir st able of st ars, and dir ect t hem t o use the BCG Matr ix t o m ak e t heir investm ent choices. Ask each g r oup t o pr esent t heir allocat ion and r ationale in t erm s of t he m atr ix. You will probabl y f ind t hat t hey were t em pted t o invest big dollars in t heir “ cash cows, � wh ich m ak es f or an interesting discussion. Q uest ions f or Ref lect ion: W hat are t he str eng t hs and weak nesses of t he BCG Matr i x as a st r at eg ic planning t ool? W hat k ind of inf or m at ion do you need in or der t o use t his t ool m ost ef f ect ively?


Chapt er 2 Str ate gic Pl ann in g in C on tem por ar y Mar Part 1 Des ig nin g C us tom er -O r iented Mar k 59 59 eting S tr k eti ng ateg ies

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Download: http://testbanklive.com/download/contemporary-marketing-3rd-edition-boone-test-bank/ Contemporary Marketing 3rd Edition Boone Test...

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