kotler fmm ce ppt ch02

A FRAMEWORK for MARKETING MANAGEMENT

Kotler Keller Cunningham

Chapter 2Chapter 2Developing and

Implementing

Marketing Strategies and

Plans

2-2

Chapter Questions

• How does marketing affect customer value?

• How is strategic planning carried out at different levels of the organization?

• What does a marketing plan include?

• How can management assess marketing performance?

© Copyright 2008 Pearson Education Canada

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Profile: Canadian Marketing ExcellenceTIM HORTONS

• Tim Hortons started out as a single donut shop in 1964 growing to 2,527 (including 184 U.S. stores) in 2006, demonstrating its skill in marketing planning and execution

• The brand exemplifies the idealized Canadian national character:“That friendly, unpretentious, good neighbour you’d

want living down the block from you” (Cathy Whelan Molloy, VP Advertising and Merchandising)

• Franchisees ensure that all products, services and communications fit the company’s ideals


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• “Roll Up the Rim to Win” and Timbits• Far ahead of rivals such as Starbucks and

Second Cup in “most often” coffee purchases• Nonprofit children’s foundation sponsors an

estimated 33,000 children in Timbit hockey leagues annually

• 2004 winner of Canadian Business poll of Canada’s best brands

Profile: Canadian Marketing ExcellenceTIM HORTONS


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Figure 2.1 Two Views of the Value Delivery Process


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Benchmarks

Organizational costs and

performance measures

Competitorcosts and

performance measures


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Five Core Business Processes

Market sensing

Customer relationship management

New offering realization

Customer acquisition

Fulfillment management


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Figure 2.2 The Generic Value Chain


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Characteristics of Core Competencies

• Important difference between core competencies and competitive advantage:• Competitive advantages accrue due to companies that

possess distinctive capabilities

• Core competencies tend to refer to areas of special technical and production expertise

• Competitive advantage derives from its “activity systems”

• Companies with activity systems that are difficult to imitate include WestJet Airlines, Dell, and Magna International


• Core Competencies are usually• A source of competitive advantage

• Applicable in a wide variety of markets

• Difficult to imitate

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Characteristics of Core Competencies


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Holistic Marketing Framework

• How can a company identify new value opportunities?

• How can a company efficiently create more promising new value offerings?

• How can a company use its capabilities and infrastructure to deliver the new value offerings more efficiently?


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Figure 2.3 A Holistic Marketing Framework


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Corporate Planning Activities

Defining the corporate

mission

Establishing SBUs

Assigning resources to SBUs

Assessing growth

opportunities


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Figure 2.4 The Strategic Planning, Implementation, and Control Processes


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Good Mission Statements

Focus on a limited number of goalsFocus on a limited number of goals

Stress major policies and valuesStress major policies and values

Define major competitive spheresDefine major competitive spheres


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Major Competitive Spheres

Industry

Products

Marketsegment

Geographical

CompetenceVertical


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Mountain Equipment Co-op

“Mountain Equipment Co-op provides quality products and services for self-propelled wilderness-oriented recreation, such as hiking and mountaineering, at the lowest reasonable price in an informative, respectful manner.

“We are a member-owned co-operative striving for social and environmental leadership.”


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Tim Hortons

“Our guiding mission is to deliver superior quality products and services for our customers and communities through leadership, innovation and partnerships.

“Our vision is to be the quality leader in everything we do.”


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eBay

“We help people trade anything on earth.We will continue to enhance the onlinetrading experiences of all–collectors, dealers, small businesses, unique itemseekers, bargain hunters, opportunitysellers, and browsers.”


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Dimensions that Define a Business

Customer groups

TechnologyCustomer

needs


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Characteristics of an SBU

• It is a single business or collection of related businesses

• It has its own set of competitors

• It has a leader responsible for• Strategic planning• Profitability• Efficiency


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Growth Opportunities

Intensive growth

Integrativegrowth

Diversificationgrowth


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Organizations

Structure

Policies

Culture


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Figure 2.5 The Business Unit Strategic-Planning Process


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SWOT Analysis


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Toolkit Productions Inc.

• Toolkit Productions Inc. originated in Toronto (2001)

• Offered a new kind of theatre in a saturated marketplace

• Gap identified was the 20-30 year demographic

• Flashy productions in bars and nightclubs• Since expanded into corporate publicity and

film production


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Market Opportunity Analysis (MOA)

• Can the benefits involved in the opportunity be articulated to a defined target market?

• Can the target market be located and reached with cost-effective media and trade channels?

• Does the company have access to the critical capabilities and resources needed to deliver the customer benefits?• Includes the assessment of interdepartmental working relationships• Honeywell gets all internal departments to conduct a strengths and

weaknesses analysis of each other• Each department is seen as both a supplier and customer to one other


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Market Opportunity Analysis (MOA)

• Can the company deliver the benefits better than any actual or potential competitors?

• Will the financial rate of return meet or exceed the company’s required threshold for investment?


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Goal Formulation

• To be effective, goals must be• Ordered in terms of priority (hierarchical)• Stated quantitatively• Realistic• Consistent


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Porter’s Generic Strategies

Overall cost leadership

Differentiation

Focus


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McKinsey’s Seven “S” Elements

StrategyStrategy StructureStructure

SystemsSystems StyleStyle

SkillsSkills StaffStaff

Shared valuesShared values


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Balancing the Internal & External Environments

ExternalEnvironmental

Internal Environment

Need Balance


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Marketing Plan Contents

Executive summary Table of contents Situation analysis Marketing strategy Financial projections Implementation controls


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Measuring Marketing Plan Performance

Sales analysis

Marketing expense-to-sales

analysis

Financial analysis

Market share analysis


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Tracking Market Share

Overall market share

Served market share

Relative market share


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Figure 2.6 Financial Model of Return on Net Worth


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Methods of Improving Return on Assets

• Method 1: Increase the profit margin by increasing sales or cutting costs

• Method 2: Boost the asset turnover by increasing sales or reducing assets that are held against sales levels


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For Discussion

What implications do Porter’s valuechain and the holistic marketing

orientation model have formarketing planning?


kotler fmm ce ppt ch02

Documents

pearson education canada2

marketing planning

marketing performance

performance measures

marketing strategies

control processes copyright

generic value chain

magna international