MARKETING STRATEGIC PLANNING COLLEGE OF BUSINESS ADMINISTRATION CHUNGANG UNIVERSITY MARKETING STRATEGIC PLANNING COLLEGE OF BUSINESS ADMINISTRATION CHUNGANG UNIVERSITY MARKETING STRATEGIC PLANNING COLLEGE OF BUSINESS ADMINISTRATION CHUNGANG UNIVERSITY
Strategic Planning — The process of maintaining a strategic fit between the organizations goal and capabilities with its marketing opportunities MARKETING STRATEGIC PLANNING COLLEGE OF BUSINESS ADMINISTRATION CHUNG-ANG UNIVERSITY PROF HYUNSUK SUH Objectives The objectives of the current chapter are described Objectives Understand company-wide strategic planning and its process Learn how to design business portfolios and develop strategies for company growth and downsizing Describe the marketing process and the forces that influence it Strategic Planning Strategic planning, why we need that for? How can strategic planning benefit a company? Why companies need strategic planning? What are the stages of the strategic planning process? Strategic Planning What is “Marketing Strategic Planning”? Marketing Strategic Planning A managerial decision process that matches an organization’s resources and capabilities to its market opportunities for long term growth and survival Solomon, 2009 The managerial process of creating and maintaining a fit between the organization’s objectives and resources and the evolving market opportunities The goal is long-term profitability and growth Lamb, Hair, and McDaniel, 2009 The Process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities It involves defining a clear company mission, setting supporting objectives, designing a sound business portfolio, and coordinating functional strategies Kotler and Armstrong, 2010 Strategic Planning Marketing Strategic Planning starts with self queries of the following Strategic Maketing Planning: Questions to Ask What is the organization’s main activity? How will it reach its goals? What is Strategic Maketing Planning? A written document that acts as a guidebook of marketing activities for the marketing manager Strategic Planning The planning activities occur at the business unit, product, and market levels in the following process The Strategic Planning Process Business unit, product, and market level Corporate level Defining the company mission Setting company objectives and goals Designing the business portfolio Planning marketing and other functional strategies Mission Statement The definitions for mission statement are described below Definition of Mission Statement The mission statement is a formal document that describes the organization’s overall purpose and what it hopes to achieve in terms of its customers, products, and resources (Solomon and Stuart) The firm’s long-term vision based on a careful analysis of benefits sought by present and political customers and analysis of existing and anticipated environmental conditions (Lamb, Hair, and McDaniel) It is a guideline for the organization’s decision making for both short and long run and provides direction to the strategic planning and marketing planning process (Hoffman, et al.) A statement of the organization’s purpose – what it wants to accomplish in the larger environment (Kotler and Armstrong) Mission Statement The mission statement is being defined as the organization’s purpose-what it wants to accomplish in the larger environment The Characteristics of Mission Statement Some of the characteristics of the mission statement are described in the following Market Oriented : Products outdated but basic market needs last forever Realistic : Achievable statement Specific : Out from generalities mark specific objectives and goals Market Environment : e.g Girl Scout Distinctive Competency : Core competence Motivating : Focus on the useful activities, not on profits and sales Make employees work is important and feeling of contributing something to someone Mission Statement The ideal mission statement is not too broad, too narrow, or too shortsighted Defining Organization’s Mission Top management’s first step in the strategic planning stage is to answer such “soul searching” questions as: What are the opportunities or needs that we exist to address? (purpose of the organization) What are we doing to address to these needs? (business of the organization) What principles or beliefs guide our work? (values of organization) Mission Statement The mission statement of different companies are described below Examples of Mission Statement Example 소녀와 젊은 여성이 책임 있는 세계시민으로서 자신의 잠재력을 최대한 개발하도록 하는데 있다 Girl Scouting builds girls of courage, confidence and character, who make the world a better place! Southwest Airlines Mission Statement 10 Mission Statement More mission statements are described below Examples of Mission Statement Example Our Roadmap starts with our mission, which is enduring It declares our purpose as a company and serves as the standard against which we weigh our actions and decisions To refresh the world To inspire moments of optimism and happiness To create value and make a difference Our mission is to be the world's premier consumer products company focused on convenient foods and beverages We seek to produce financial rewards to investors as we provide opportunities for growth and enrichment to our employees, our business partners and the communities in which we operate And in everything we do, we strive for honesty, fairness and integrity 12 Mission Statement Most mission statements today contain market-oriented business themes Mission Statements? Example To provide relief to victims of disasters and help people prevent, prepare for, and respond to emergencies We create fantasies – a place where America still works the way it’s supposed to We deliver solutions to customer’s information technology problems We help people experience the emotions of competition, winning, and crushing competitors Space, the final frontier These are the voyages of the starship Enterprise Its five-year mission: To explore strange new worlds To seek out new life and new civilizations To boldly go where no man has gone before 13 Mission Statement In order for the corporate mission to be accomplished and make our customers understood our corporate identity, both internal and external CIs be properly set The Composition of CIs External CI Internal CI Mind Identity (Disciplines) Behavior Identity Visual Identity (symbol, logo) Verbal Identity 14 Mission Statement Drink Coca-Cola Delicious And Refreshing Three Million A Day Thirst Know No Season Six Million A Day Around the corner from everywhere The pause that refreshes Ice Cold Sunshine The Best Friend Thirst Ever Had Coca-Cola goes Along The Only Thing Like Coca-Cola is Coca-Cola Itself 마시자 , 코카콜라 1948 Where There's Coke There's Hospitality 코카콜라가 있는 곳엔 따뜻함이 있어요 1949 Coca-Cola Along the High Way to Anywhere 코카콜라 어디서나 찾을 수 있어요 1952 What You Want is Coke 당신이 진정으로 원하는 것은 코카콜라 1956 Coca-Cola Makes Good Thing Taste Better 코카콜라 함께한 다른 것들의 맛까지 훌륭하게 해줘요 1959 진짜 상쾌해지세요 1982 Be Really Refreshed Things Go Better with Coke It's the Real Thing I'd Like to Buy the World a Coke Coke Adds Life Have a Coke And A Smile Coke Is It! 1986 Coca-Cola Red, White & You 코카콜라 빨간색 , 하얀색 , 그리고 당신 1990 Can't Beat the Real Thing Always Coca-Cola Enjoy Coca-Cola Stop Thinking Feel It.! 무엇도 이 맛을 대신할 순 없어요 1886 1904 1917 1922 1925 1927 1929 1932 1938 Slogan for Coke 1939 1942 1963 1969 1971 1976 1979 1993 2000 2003 맛 좋고 상쾌한 하루에 300 만 잔 갈증에는 계절이 없어요 하루에 600 만 잔 지구 곳곳 어디서나 상쾌한 이 순간 얼음같이 차가운 햇살 갈증의 가장 친한 친구 코카콜라가 함께 가요 코카콜라 같은 것은 오직 코카콜라 밖에 없어요 코카콜라와 함께라면 문제 없어요 상쾌한 그 맛 , 코카콜라 온 세상에 코카콜라를 사주고 싶어요 즐거움을 더해주는 코카콜라 코카콜라와 함께 웃어요 코카콜라 , 그것 뿐 ! 언제나 코카콜라 코카콜라 즐겨요 15 Setting Company Objectives and Goals The objective is a statement of what is to be accomplished through marketing activities Setting company objectives and goals to actualize the mission statement has the following guidelines The Characteristics of the Organization’s Objectives are … Specific : Clearly Defined Outcomes Measurable : Quantitative Terms Achievable : Realistic Compare to Benchmark Time-bound : To Be Reached Within “Our objective is to increase sales of Purina brand cat food by 15 percent over 2014 sales of $300 million.” Specific Time Frame 16 Setting Company Objectives and Goals The following examples provide a scent of how objectives be made of Example Poorly vs Well Stated Objectives Well Stated Objectives Well Stated Objectives ? 17 Designing Business Portfolio The company must analyze the current business portfolio to decide which business should receive more or less, or no investment Business Portfolio: BCG-Growth/Share Matrix High MARKET GROWTH ? Stars : High-growth, high-share businesses or products Need heavy investment to finance rapid growth Eventually the growth will slow down and turn into Cash cows Question Mark Star Dog Cash Cow Low Low MARKET SHARE High < 전통적 BCG* 매트릭스 > Reference: BCG-Boston Consulting Group Question marks : Low-share business units in high-growth markets It can be either a “Star” or “Dog” Requires a lot of cash to hold their share Cash cows : Low-growth, high-share businesses or products Produce lot of cash to support other biz units Need less investment to hold the market share Dogs: Low-growth, low-share businesses and products May generate enough cash to maintain themselves 18 Designing Business Portfolio The BCG model suggests different strategies according to the different life cycles of the product SALES Product Life Cycle and BCG Matrix Strategy Strategy 1: 제품의 수명주기의 변화에 따라서 Question mark Star Cash Cow 로 변화되도록 관리 하는 것이 바람 직 함 CASH COW R TA S Q UE M ST AR IO K N G DO ? Introduction Strategy : 건전한 제품 군들을 유지하기 위해서는 Question mark, Star, and Cash Cow 등 모든 제품 군들을 균형 있게 포함해야 함 TIME Growth Maturity Decline 19 ANY DRAWBACKS? Designing Business Portfolio The GE/McKinsey model has been developed to compensate the limitations of BCG model Examples of GE/McKinsey Matrix 산업 매력도 구성요인 Example 가중치 평가점수 가중 평가점수 시장의 크기 (market size) 0.5 2.5 수익률 (profitability) 0.2 0.4 경쟁 정도 (level of competition) 0.3 0.9 합계 1.0 산업 경쟁력의 구성 요인 가중치 평가점수 가중 평가점수 점유율 (market share) 0.5 1.5 관리능력 (management) 0.1 0.3 기술수준 (skills) 0.4 0.6 합계 3.8 1.0 3.4 산업의 매력도를 평가하는 데 사용되는 변수들 : 시장규모 , 산업성장률 , 산업 평균 수익률 , 경쟁의 정도 , 전반적인 수급 상황 등 산업의 경쟁력을 평가하는 데 사용되는 변수들 : 시장 점유율 , 관리능력 , 기술수준 , 제품의 품질 , 상표 이미지 , 생산능력 , 원가구조 , 유통망 등 20 Designing Business Portfolio The relationship between product life cycle and its sales, profit, and competition is described below SALES PROFIT COMPETITION I Increasing Negative Starting G High Increasing Increasing M Slow Stabilized Stabilized D Downward Eroding Market Exit SALES Product Life Cycle and Sales, Profit, Competition CASH COW AR ST Q U E M ST AR IO K N G DO ? Introduction TIME Growth Maturity Decline 21 Designing Business Portfolio Consider the following example Product/Market Expansion Grid (Ansoff’s Strategic Opportunity Matrix) Existing Markets Existing Products Market Penetration New Markets New Products Product Development Market Development Diversification Market Penetration: Making more sales to current customers without changing its products Market Development : Identifying and developing new markets for its current products Product Development: Offering modified or new products to current markets Diversification : Start up or buy businesses outside of current products and markets 22 Designing Business Portfolio Consider the following example Product/Market Expansion Grid (Ansoff’s Strategic Opportunity Matrix) Existing Products Exercise New Products Existing Markets New Markets McDonald’s Sells More McDonalds Opens McDonald’s Introduces Happy Meals with Disney McDonald’s Introduces Line of Children’s Clothing Movie Promotions Salad Shakers and Restaurants in McWater 23 African Cities for the First Time Designing Business Portfolio The business portfolio analysis help to identify and evaluate marketing opportunities Example Analyzing Marketing Opportunities • 시장 수요가 낮으며 자사의 능력도 부족 • 투자를 중단하고 더 매력적 인 오퍼링에 초점을 맞추는 것이 좋음 • 가장 매력적인 오퍼링으로 수요도 높고 자사의 능력도 좋음 • 지속적으로 시장 점유율을 신장시키는 전략이 필요 MARKET DEMAND • 시장의 수요는 높은데 자사 의 능력이 부족 • 자사의 오퍼링 / 기능을 개발High 해야 함 Low Low ABILITY TO DELIVER • 다음 세 가지 중 하나의 전략을 채택할 수 있음 ① 투자를 중단 ② 가능한 많은 이윤을 남겨 그것을 유망한 사업에 투자 ③ 고객을 설득해서 매트릭스 High 상에서 이들의 위치를 높임 < 오퍼링 분석 매트릭스 > 시장 내에서 오퍼링의 위치를 정하고 성장시키는 방법에 대한 식견을 제공 24 Marketing Process The marketing process can be divided into controllable and uncontrollable factors Uncontrollable Factors Controllable Factors PRODUCT Quality Design Features Brand name Service Warranties Returns PROMOTION Advertising Personal selling Sales promotion Public relations PRICE Target Customers Intended Positioning List price Discounts Payment period Credit terms PoliticalLegal Environment Demographiceconomic PLACE Environment Channels Locations Inventory Transportation Logistics 25 TechnologicalNatural Environment SocialCultural Environment Marketing Process Consider the following issues Exercise End of Chapter Questions Name and describe the four product/market expansion grid strategies KFC is now rolling out a new Kentucky Grilled Chicken line to add to its traditional fried chicken lineup Which growth strategy does this represent? Briefly discuss why management may find it difficult to dispose of a “question mark.” A group of investors has purchased from an inventor the U.S rights to sell a patented, innovative mousetrap The group has hired Martha House to manage the company that includes assuming responsibility for sales and marketing This case provides details of the marketing strategy employed by Ms House Despite the innovativeness of the mousetrap and its success at gaining public attention, sales are disappointingly slow Martha finds herself wondering why the world is not beating a path to her door, as Ralph Waldo Emerson would have predicted Martha and the investors in Trap-Ease seem to face a “once-in-a-lifetime opportunity.” What information they need to evaluate this opportunity? What you think the investor group would write as its “mission statement?” 26 ... influence it Strategic Planning Strategic planning, why we need that for? How can strategic planning benefit a company? Why companies need strategic planning? What are the stages of the strategic planning. .. Thinking Feel It.! 무엇도 이 맛을 대신할 순 없어요 1886 1904 1917 1 922 1 925 1 927 1 929 19 32 1938 Slogan for Coke 1939 19 42 1963 1969 1971 1976 1979 1993 20 00 20 03 맛 좋고 상쾌한 하루에 300 만 잔 갈증에는 계절이 없어요 하루에 600 만 잔... functional strategies Kotler and Armstrong, 20 10 Strategic Planning Marketing Strategic Planning starts with self queries of the following Strategic Maketing Planning: Questions to Ask What is the