Chapter 2: Developing a Marketing Plan and Marketing Strategies
Levels of Strategic Planning in Corporations
• Corporate level planning is done by the company’s top management and focuses on the overall direction
of the entire company
• Corporate level planning focuses on the long term direction of the company, which is updated regularly
to respond to change in the business environment
• Large companies that operate several business lines may see each of their strategic business units
(SBU’s) develop strategic plans for their products for their products and the markets they serve
• An SBU is a division of the company that can be managed somewhat independently from other divisions
since it markets a specific set of products to a clearly defined group of customers
• Marketing Planning Process: a set of steps a marketer goes through to develop a marketing plan
The Marketing Plan
• A marketing plan is a written document composed of an analysis of the current marketing situation,
opportunities and threats for the firm, marketing objectives and strategies specified in terms of the four
Ps, action programs, and projected or proforma income (and other financial) statements
• Planning Phase: when marketing executives and other top managers define the mission and objectives
of the business, and evaluate the situations by assessing how various players, both inside and outside the
organization, affect the firm’s potential for success
• Implementing Phase: where marketing managers identify and evaluate different opportunities by
engaging in a process known as segmentation, targeting, and positioning. They then develop and
implement the marketing mix by using the four Ps.
• Control Phase: the part of the strategic marketing planning process when managers evaluate the
performance of the marketing strategy and take any necessary corrective actions.
Step 1: Define the Business Mission and Objectives
• Mission Statement: a broad description of a firm’s objectives and the scope of activities it plans to
undertake; attempts to answer two main questions: What type of business is it? and What does it need to
do to accomplish its goals and objectives.
• These fundamental business issues must be answered at the highest corporate levels before marketing
executives can get involved
• Another key goal or objective often embedded in a mission statement is how the firm is building a
sustainable competitive advantage
Step 2: Conduct a Situation Analysis
• Situation Analysis: is the second step in a marketing plan; uses a SWOT analysis that assesses both the
internal environment with regard to its Strengths and Weaknesses and the external environment in terms
of its Opportunities and Threats.
• Additionally, the firms should assess the opportunities and uncertainties of the marketplace due to
changes in cultural, demographic, social, technological, economic, and political forces (CDSTEP)
• A SWOT analysis is designed to help the firm determine areas in which its strong and can compete
effectively and areas where it is weak and vulnerable to competitive attacks
• Enables the firms to understand where it has sustainable competitive advantage or unique advantage that
cannot be easily copied by competitors and how it can leverage those advantages in response to new
opportunities arising from changes in its external environment
Step 3: Identify and Evaluate Opportunities by Using STP (Segmentation, Targeting, and Postitioning)
• STP: the processes of segmentation, targeting, and positioning that firms use to identify and evaluate
opportunities for increasing sales and profits • With STP, the firm must first understand customer needs and subgroups or segments, determine which
of those segments it should pursue or target, and finally decide how it should position its products and
services to best meet the needs of those chosen targets
• Many types of customers appear to any market, and most firms cannot satisfy everyone’s needs.
• Market Segment: a group of consumers who respond similarly to a firm’s marketing efforts
• Market Segmentation: the process of dividing the market into distinct groups of customers where each
individual group has similar needs, wants, or characteristics – who therefore might appreciate products
or services geared especially for them in similar ways
• Firms may also segment consumers based on benefits sought or sociocultural factors
• Target Marketing/ Targeting: the process of evaluating the attractiveness of various segments and then
deciding which to pursue as a market
• After identifying its target segments, a firm must evaluate each of its strategic opportunities
• Firms typically are most successful when they focus on these opportunities that build on their strengths
relative to those of their competition
• Positioning is what consumers think and feel about a brand or product, marketers try very hard through
their various marketing efforts to shape consumers’ perceptions regarding their brand or product.
• Market Positioning: involves the process of defining the marketing mix variable so that target
customers have a clear, distinct, desirable understanding of what the product does or represents in
comprising with competing products
Set Marketing Objectives:
• Normally the marketing manager is responsible for setting the specific marketing objectives for the
product or brand over the life of the plan.
• These objectives may include market share, revenues and profitability targets, unit sales volume, and
Step 4: Implement Marketing Mix and Allocate Resources
• In the fourth step of the planning process, marketers implement the marketing mix – product, price,
promotion, and place for each product and service on the basis of what it believes its target markets
• Each element of the four Ps must be fully integrated to achieve a coherent strategy.
Product and Value Creation:
• The key to the success of any marketing program is the creation of value, firms attempt to develop
products and services that customers perceive as valuable enough to buy
Price and Value for Money:
• Value based marketing requires that firms change a price that customers perceive as giving them a good
value for their products and services they receive.
• Marketers should base price on the value that the customers perceives
Place and Value Delivery: • The firm must be able to, after it has created value through a product and/ or service, make the product
or service readily accessible when and where the customer wants it
Promotion and Value Communication:
• Marketers communicate the value of their offering, or the value proposition, to their customers through a
variety of media, including TV, radio, magazines, buses, trains, blimps, sales promotion, publicity, the
sales force, and the Internet.
• Marketers therefore must consider which are the most efficient and effective methods to communicate
with their customers, which goes back to understanding customers, the value created, and the message
• In addition to developing the four Ps and allocating resources, marketing managers must develop
schedules: timelines for each activity and the personnel responsible for the respective activity to avoid
bottlenecks and ensure smooth and timely implementation of the marketing mix activities.
• Marketers must design the organization that will be responsible for putting the plan into action
• The marketing organization is usually responsible for the daytoday operational decisions involved in
executing the plan.
Step 5: Evaluate Performance by Using Marketing Metrics
• A metric is a measuring system that quantifies a trend, dynamic, or characteristic.