Marketing plans how to prepare them, how to profit from them (2016) malcolm mcdonald, hugh wilson

Giáo trình Marketing plans how to prepare them, how to profit from them (2016) malcolm mcdonald, hugh wilson Giáo trình Marketing plans how to prepare them, how to profit from them (2016) malcolm mcdonald, hugh wilson Giáo trình Marketing plans how to prepare them, how to profit from them (2016) malcolm mcdonald, hugh wilson Giáo trình Marketing plans how to prepare them, how to profit from them (2016) malcolm mcdonald, hugh wilson Giáo trình Marketing plans how to prepare them, how to profit from them (2016) malcolm mcdonald, hugh wilson Giáo trình Marketing plans how to prepare them, how to profit from them (2016) malcolm mcdonald, hugh wilson

Marketing Plans Eighth Edition Marketing Plans How to Prepare Them, How to Profit From Them Eighth Edition Malcolm McDonald Hugh Wilson This edition first published 2016 © 2016 Malcolm McDonald and Hugh Wilson Fifth edition published 2002, sixth edition published 2007, both by Elsevier Ltd, seventh edition published 2011 by John Wiley and Sons, Ltd Registered office John Wiley and Sons Ltd, The Atrium, Southern Gate, Chichester, West Sussex, PO19 8SQ, United Kingdom For details of our global editorial offices, for customer services and for information about how to apply for permission to reuse the copyright material in this book please see our website at www.wiley.com The right of the authors to be identified as the authors of this work has been asserted in accordance with the Copyright, Designs and Patents Act 1988 All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, except as permitted by the UK Copyright, Designs and Patents Act 1988, without the prior permission of the publisher Wiley publishes in a variety of print and electronic formats and by print-on-demand Some material included with standard print versions of this book may not be included in e-books or in print-on-demand If this book refers to media such as a CD or DVD that is not included in the version you purchased, you may download this material at http://booksupport.wiley.com For more information about Wiley products, visit www.wiley.com Designations used by companies to distinguish their products are often claimed as trademarks All brand names and product names used in this book and on its cover are trade names, service marks, trademark or registered trademarks of their respective owners The publisher and the book are not associated with any product or vendor mentioned in this book None of the companies referenced within the book have endorsed the book Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with the respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose It is sold on the understanding that the publisher is not engaged in rendering professional services and neither the publisher nor the author shall be liable for damages arising herefrom If professional advice or other expert assistance is required, the services of a competent professional should be sought Library of Congress Cataloging-in-Publication Data Names: McDonald, Malcolm, author | Wilson, Hugh, author Title: Marketing plans: how to prepare them, how to profit from them / â•… Malcolm McDonald, Hugh Wilson Description: Eighth Edition | Hoboken : Wiley, 2016 | Revised edition of the authors’ Marketing plans, â•… 2011 | Includes bibliographical references and index Identifiers: LCCN 2016022150| ISBN 9781119217138 (pbk.) | ISBN 9781119217183 â•… (Adobe PDF) | ISBN 9781119217176 (epub) Subjects: LCSH: Marketing—Management | Marketing—Planning Classification: LCC HF5415.13 M255 2016 | DDC 658.8/02—dc23 LC record available at https://lccn.loc.gov/2016022150 A catalogue record for this book is available from the British Library ISBN 978-1-119-21713-8 (paperback) ISBN 978-1-119-21718-3 (ebk) ISBN 978-1-119-21717-6 (ebk) ISBN 978-1-119-30989-5 (ebk) Cover design: Wiley Cover images: © Petar Ivanov Ishmiriev/Shutterstock 10╇9╇8╇7╇6╇5╇4╇3╇2╇1 Set in 9/11pt ITC Garamond by Aptara, New Delhi, India Printed in Italy by Printer Trento, Italy Contents Preface and acknowledgements  vi How to use this book to achieve the best results  viii Learning features  x Tutors’ guide  xii An important note to the reader from the authors  xiii Part One  The Marketing Planning Process and the Output  Chapter Understanding the Marketing Process  Chapter The Marketing Planning Process: The Main Steps  39 Chapter The Customer and Market Audit Part 1: Understanding Markets and Market Segmentation  77 Chapter The Customer and Market Audit Part 2: Understanding Customer Needs and Developing Value Propositions  139 Chapter The Customer and Market Audit Part 3: The Product Audit  165 Chapter Setting Marketing Objectives and Strategies  227 Part Two  The Major Elements of Marketing  273 Chapter The Integrated Marketing Communications Plan  275 Chapter The Sales and Key Account Plan  327 Chapter The Multichannel Plan: The Route to Market  371 Chapter 10 The Customer Relationship Management Plan  417 Chapter 11 The Pricing Plan  451 Part Three  Marketing Plans Measurement and Implementation  483 Chapter 12 Implementation Issues in Marketing Planning  485 Chapter 13 Measuring the Effectiveness of Marketing Planning  537 Chapter 14 A Step-by-Step Marketing Planning System  561 Conclusion: Guidelines from the authors on world-class marketing   599 Marketing Planning: Yes, it really works! Experiences from the real world  603 Index  615 v Preface and acknowledgements Please read this as it contains important information about this book The importance of marketing planning is demonstrated by the half million copies of this book that have been sold in English and many other languages since it was first published in 1984 Since the book’s launch, it has helped and encouraged hundreds of thousands of practising managers with the difficult task of marketing planning Many of them have been kind enough to write expressing their thanks for the book’s practical, no-nonsense style and approach to the subject This has encouraged the first author, Malcolm McDonald, to update the book continually in previous editions, and after the sixth edition, to ask his esteemed colleague Professor Hugh Wilson to join him as co-author Originally a computer scientist, Hugh brings to the book deep experience in the latest thinking on marketing in a digital world, including integrated marketing communications, e-commerce, multichannel strategy and customer relationship management (CRM) The authors have been working together on how to evolve marketing planning in a digital world for over 20 years The purpose of this book is quite simply to explain and demonstrate how to prepare and use a marketing plan It is equally relevant for consumer, service and industrial goods companies, as well as not-for-profit organizations, since the process is universal It is based on our research into the marketing planning practices of industrial, service and retail companies, which has revealed marketing planning as an area of major weakness Almost without exception, companies that thought they were planning were in fact only forecasting and budgeting, and suffered grave operational difficulties as a result The problem, as companies face up to the opportunities and challenges of the twenty-first century is not that the philosophy of marketing is not believed; rather it is that most companies, particularly industrial goods companies and many service organizations, have difficulty in making it work This is largely because of ignorance about the process of planning their marketing activities, for which little help is provided in the extant body of literature Books or articles often turn out to be about the management of the several elements of the marketing mix rather than about the process of combining them into a coherent plan Others treat marketing planning in such a generalized way that it is difficult to distil from them any guidance of operational significance Finally, there are many excellent papers about individual aspects of the marketing planning process The truth is, of course, that the actual process of marketing planning is simple in outline Any book will tell us that it consists of: a situation review; assumptions; objectives; strategies; programmes; and measurement and review What other books not tell us is that there are a number of contextual issues that have to be considered that make marketing planning one of the most baffling of all management problems Here are some of those issues: ●● ●● vi When should it be done, how often, by whom and how? Is it different in a large and a small company? ●● ●● ●● ●● ●● ●● Preface and acknowledgements Is it different in a diversified and an undiversified company? Is it different in an international and a domestic company? What is the role of the chief executive? What is the role of the marketing department? Who else needs to be involved, and how? Should marketing planning be top-down or bottom-up? What is the relationship between operational (one year) and strategic (longer-term) planning? Since effective marketing planning lies at the heart of a company’s revenue-earning activities, it is not surprising that there is a great demand for a guide which strips away the confusion and mystery surrounding this subject and helps firms to get to grips with it in a practical and down-to-earth manner This book explains what marketing is, how the marketing planning process works, how to carry out a marketing audit, how to set marketing objectives and strategies, how to schedule and cost out what has to be done to achieve the objectives, and how to design and implement a simple marketing planning system Our approach is both logical and practical This view has been confirmed by the hundreds of letters and e-mails referred to above, and by the fact that this book is now a standard text on many marketing courses in universities, and in-company training programmes around the world This book includes: ●● ●● ●● ●● Application questions, to help you personalize the learning Exercises at the end of every chapter to enable practising managers to translate the theory into practice Mini case studies to exemplify the points being made A step-by-step process, with templates, for producing marketing plans Additionally, a comprehensive online Tutors’ Guide is available for those who wish to teach the subject to others This Tutors’ Guide contains lecture plans, PowerPoint masters, case studies, tutors’ discussion points and additional assignments for use by tutors Please visit www.marketingplansbook.com We would like to thank our friends and colleagues for the advice they have given us and material they have generously allowed us to use during the life of this book To the following we are especially grateful: Dr Chris Bailey, Dr Krista Bondy, Lindsay Bruce, Dave Chaffey, Professor Martin Christopher, Professor Moira Clark, Professor Elizabeth Daniel, Dr Iain Davies, Matt Hobbs, Professor Aamir Khan, Ardi Kolch, John Leppard, Associate Professor Dr Emma Macdonald, Professor Simon Majaro, Dr Stan Maklan, Anne Mollen, Aly Moore, Peter Mouncey, Professor Adrian Payne, Beth Rogers, Professor Lynette Ryals, Dr Brian Smith, Rod Street and Diana Woodburn To them and the many other scholars and practitioners who have contributed invaluable ideas in specific sections we will always be grateful Rather than updating the flow of the text by providing complete individual references, we restrict ourselves to a few references at the end of each chapter For fuller bibliographies, please see the PhD research on which this book is primarily based: details are available from m.mcdonald@cranfield.ac.uk or hugh.wilson@cranfield.ac.uk Professor Malcolm McDonald Professor Hugh Wilson Cranfield University School of Management October 2016 vii How to use this book to achieve the best results At the end of each chapter, you will find a number of application questions More importantly, there are also a number of exercises designed to help you translate the theory into practice in the context of your own organization As you work through this book, you will find that some of the exercises are diagnostic and enable you to ‘plot’ where your company is Some will help you to understand what might be happening to your organization Other exercises are more concerned with generating factual information about your organization, its products, its markets or its planning processes We find this combination of exercises not only provides you with insights and learning about many aspects of marketing planning, but it also helps you to assemble information, which can contribute to a marketing plan for your organization Whenever scoring and interpretation are required for an exercise, you will find the answers are provided at the end of each chapter This book is written to fulfil three principal needs The first relates to the process of marketing planning, which, while theoretically simple, is in practice extraordinarily complex, involving, as it does, people, systems and organizational structures One purpose, then, is to ensure that readers fully understand the process, what the pitfalls are and how to negotiate them The second purpose is to ensure that readers know which are the appropriate marketing diagnostic tools, structures and frameworks to use at each stage of the process The third and most important purpose, however, is to give both students and managers a nononsense, practical, step-by-step guide on how to prepare a really good, strategic marketing plan that will help their organizations to create sustainable competitive advantage for themselves and for their customers KEY AREAS FOR IMPROVEMENTS IN STRATEGIC MARKETING PLANNING: WHERE TO LOOK IN THIS TEXT FOR PRACTICAL GUIDANCE This help section is based on the analysis of over 700 strategic marketing plans from over fifty multinationals during a period of twenty-five years A fee was charged for each analysis, so these comments are based on considerably more than just opinions Summary of the book A strategic marketing plan should be a clear and simple summary of key market trends, key target segments, the value required by each of them, how we intend to create superior value (to competitors), with a clear prioritization of marketing objectives and strategies, together with the financial consequences viii Marketing Planning: Yes, it really works! Experiences from the real world Sales within the US were through a large distribution network of some 420 distributors that included around 10 per cent overseas sales We were selling at ‘transfer’ or distributor prices but we were not selling to the end user The market, we were in required expensive annual recertification of our products to a very high NFPA standard (for US Firefighting gloves) and this was a very high cost way of doing business In completing the planning process, I used excellent and readily available market data available through various organizations involved with the firefighting market, and several other government departments involved with statistical data, which is always readily available, if you know where to look The Data Revealed Within the ‘Strategic Plan’ Several things became apparent as I steadily went through the Market Planning process: The market we were in was saturated with similar undifferentiated products Prices were depressed, through tough competition, with little room for increased margins The cost of annual re-certification was extremely high (a barrier to entry for all) Deliveries were protracted and our quality was poor Our manufacturing was outdated – ‘batch and queue’ – and was highly expensive, incurring a 50 per cent turnover of unhappy sewing and production staff who had never had any increase in pay Our market share was 20 per cent and rapidly declining We were also in a very low cost industrial glove business that we were losing money on with each pair of gloves that we manufactured Our product mix included considerable overlap with our own products that made no sense We now had our ‘Road Map’ and the actions we were to take that emerged from the plan became obvious Externally we needed to re-engage our distribution network to believe in our company and our products as soon as possible and this was important and urgent! Internally, in order to this, we had to reduce manufacturing costs, improve delivery times, and above all improve our quality I also believed we had to create a product differentiation from our competitors, though that was important but not urgent I met our main distributors and shared with them my findings, explaining where we needed to focus if we were going to succeed in our chosen market Normally, this information would be confidential, but time was running out and my plan required that our distributors remained loyal and didn’t move to another manufacturer, which, as I found out, 30 per cent had already done so Implementing the Plan In order to reduce our costs I introduced LEAN manufacturing, which had become obvious from completing the market plan that this had never before done in a US cut and sew glove manufacturing operation I reached out to the Department of Economic Development who agreed to help me implement LEAN and together we completed the task in only four months Prior to this we had a complicated production process that was not streamlined, with eighty-two production staff The company had an archaic ‘peace rate’ pay system that encouraged our sewing staff to rush their work in order to make any kind of living and this had led to our poor quality, since they had to work fast if they were to make any production bonus I changed this system into a timed sewing system, as a part of a LEAN introduction that rewarded them more for getting it right 611 612 Marketing Planning: Yes, it really works! Experiences from the real world first time over their sewing speed This led to ‘teams’ working together to mutually benefit from production and quality bonuses instead of working only for themselves After implementation we had spectacular results: reduction of costs by 33 per cent, improved lead times, faster overall speed of production, better quality, and we managed to increase production with fewer staff I also shut down the industrial glove business, as imports were selling at less than our leather costs alone! This, too, became apparent within the plan A New Look and a New Pay Structure Everyone in the company was on board with the positive changes we were making The machines were freshly painted, the factory was cleaned (for the first time in decades), the production had a new fresh look, an excellent workflow system was laid out and we were now on track In the planning process the ‘peace rate’ pay system had become highly visible as a negative to all of our staff The fix was to link pay with overall production and not just pay for finishing each component, as it was prior to the change I created ‘cells’ where finished pairs of gloves, coming off the line, were the base unit for production pay, and quality was measured at a higher rate for their bonuses over speed of operation As part of LEAN we had re-timed every operation and created new timings, which they could all manage without rushing If we also had resulting higher quality we would not waste money in re-manufacture This new process led to a significant pay increase, which was covered out of the increased production efficiency and higher quality of finished goods In other words we shared the win–win with all of our staff Threats, Now a Reality When completing the strategic plan, I had identified two main threats, during the SWOT analysis One threat was new competition from overseas and the other was a limited and fixed market size Our market size had not changed in more than fifteen years and part of the threat analysis is the ability to be forewarned of a threat This leads to the creation of ‘opportunities’ from these identified threats The threat of overseas competition became a reality very quickly when a brand new product from Pakistan entered our market: a glove with a much lower sales price and with higher dexterity than any in our market This occurred just as we were gaining our market confidence back and could not have happened at a worse time That’s often the way in business, so you have to move fast! The result was that twenty per cent of our sales were lost in a very short time, leaving us with an urgent problem we had to solve Sharing the Problem I wanted all of my production staff to understand the issue and the reality that would affect all of them if we continued to lose market share, in that the company would close down Moving production overseas was not a choice for us, since our quality had taken such an effort to improve, and our deliveries and agility to quickly switch between products through demand were far better than with imported products Added to this the cost of transition to overseas production was not something we could now afford I wanted to maintain a US production with more competitive products and an acceptable price that our market would choose over imported products Marketing Planning: Yes, it really works! Experiences from the real world I engaged the entire staff in my development of a new US-made certified firefighting glove in order to not only meet, but to beat our competition and to increase our market share as a result This threat had now become an incredible opportunity for us but would not be easy Involvement in the Solution Many times in many companies, production staff never see what the competition really is and thus have no idea what happens in the sales process, only that they are busy or slack week to week I wanted them all to realize the nature of the problem so I laid out all of our competitors’ gloves next to ours, then I showed them the cause of our downtrend in sales with the new imported product I asked for their help with the fix and they all readily agreed I then focused on nothing other than to design a new, radically different, high dexterity, high quality US-made glove My message here is to focus, focus, focus on the project at hand and not allow anything to interrupt the ‘fix’ of the problem I looked at a ski glove that was pre-curved, had incredible dexterity and other similar properties to a firefighting glove (a liner, moisture barrier and an outer shell) I began the design process and piece-by-piece I created, with my staff’s help, a new radically different product When I had finished the design part of the process, I had to assess the manufacturing operation I sat with each of the sewing staff to time their individual operation in the manufacture of our new product and this led to modifications of the design so that it would be easy to manufacture at high speed Spectacular Results When we had finished the design and certification, we had a new product, new adhesive technology and a three-dimensional glove that no one in the US was able to make We called the glove the ‘Blaze Fighter’ and when we launched it we had absolutely no cash for a big advertising campaign I thought if the product is as good as we think it is then word-of-mouth marketing would have to We made eighty pairs and sent them out to our top dealers The results were spectacular: within six months we had sold a million dollars’ worth of the Blaze Fighter glove alone and over the next twelve months we made another three million dollars in sales The Blaze Fighter became the biggest selling glove ever in the American firefighting market and was taken up by the prestigious FDNY Because we had involved our production staff in the development our costs were very low and the resulting profit was five times higher than any other glove we had made We now had the biggest glove manufacturing operation in the USA with two facilities, not one as we had originally The second was a prison operation where our costs were low and the staff never had ‘Mondays off’ or continuous sick leave A Strategic Marketing Plan Works Had I not developed a focused strategic marketing plan, as I had been trained to by Professor Malcolm McDonald, I would not have been able to make the numerous changes required to turn our operation around The plan had a logical and analytical approach to what was required and became the road map for the way forward Each improvement and activity, we had to undertake, in order to become successful, was within the ‘strategic plan’ and sales, believe it or not, was not the focus If you have the plan and you have followed the steps in creating it, then sales would follow 613 614 Marketing Planning: Yes, it really works! Experiences from the real world Versatility Each company I have worked with only looks at annual sales They spend a few months going through opportunities, based on what their sales staff can see Then they set a sales growth for the following year, based on very little factual knowledge I have now used this planning process in a fragrance company start up, leading to becoming second in sales in the US fragrance market in the second year of operation I have also implemented this planning process in a Fortune 500 Swedish company to implement ‘Strategic Market Planning’ in 30 countries They too had the annual sales meeting to ‘guess’ where they would be in each following year After the implementation of Strategic Market Planning, they were able to meet demands of their market and create many new markets for themselves These are excerpts from my autobiography, One Of A Kind, Making It Happen available from Amazon Index 3M Post-it notes 184 4Ps 4, 20, 63, 229, 250–1, 257, 371 Is of E-marketing 292–9 80/20 rule see Pareto effect ‘10S’ approach to barriers 516–18 a priori segmentation 89 ABC see activity-based costing above-the-line expenditure see advertising accessible market size 202 accessible volume/value, key accounts 352 accountability framework 537–8, 540–53 accountancy 92, 452–6 accounting value 150, 151 ACORN categories 135 acquisition of customers 419, 420, 421 activation activities 315 activities key activity plan 582, 589 outcomes linking 547–50 sponsorship 315 activity-based costing (ABC) 86, 344 added values 150, 151, 170, 179 definition 539–40 experience effect 191 shareholder value 150, 151, 537, 542–7 value added chain 98, 101 addressability, communications 293–5 administrative role, planners 494 advertising 10, 279, 281, 427 definition 303 media choice 289–91, 320–2 new product adoption 187 objective-setting 231, 233, 286–8, 316, 319–20 plan preparation 286–91, 316, 322 social media 301–3 strategic role 307 affiliate marketing 303, 502 aggregating products/services 82–5, 98 agrochemical companies 213–14 airline industry 9, 20, 384–5 Amazon 303 analysis team, DPM 201 annuity market 374–7 Ansoff, Igor 235 Ansoff Matrix 233–5, 247 exercises 259–63, 265–6, 328 gap analysis 245–6 outcomes linking 547–50 review 256–7 appendices inclusion 592 arts sponsorship 312, 313 asset base constraints 56 assets brands as 171 expenditure and 539 map of marketing 55 market segmentation 252 see also intangibles assumptions 62 documentation 576 exercises 265 organization chart model 531–2 assurance, customer services 396, 402 attitudes benefit analysis 134, 136 development of 312 market segmentation 118–19 outcomes linking 547–50 pricing 475 attractiveness factors key accounts 350, 352–3 markets 118–19, 201–4, 208–9, 237 scoring 353 segments 118, 253 audits customer/services 411–13 distribution audit 392–4 hierarchy of 510 management audit 51–2 see also marketing audit autonomy crises 498 aviation market 9, 20, 384–5 awareness creation, advertising 288 balance sheets 53 balanced portfolios 341, 342 banking operations 44 channel selection 373, 384 competitive strategies 241 CRM 424 banner ads 303 barriers to planning 515–18, 520 basic KAM stage 347, 354 BCG see Boston Consulting Group behaviour see purchasing behaviour below-the-line expenditure see sales promotion benefit analysis 218–22 distribution 389 exercises 128–32, 475 key account management 343–5 matrix 242 benefit dependency network (BDN) 442–4, 446–7 benefit package analysis 218–22 bipolar maps 172–3 blue-chip companies 210–11 board-level organization 502–5 Boston Consulting Group (BCG) 191–3, 197, 453, 465 Boston Matrix 193–9, 217 bottom-up approach 509, 513, 593–4 BPR (Business Process Redesign) 507 brand exposure 301–2 brand functionality 175 brand image 396, 402 brand loyalty ladder 282 brand names169–70 brand personality 174 brand positioning 172–3, 177 brand preference 150 brand strategy 172, 176 brands 15–16, 169–80, 282 category management 179–82 companies as 176 components of 172–6 definition 169 experience quality 396, 402 global versus local 176–9 product lifecycles 184 social media 301–2 successful/unsuccessful 171–2, 179 breakeven analysis 458–9 British motorcycle industry 453–4 British Standard Industrial Classification System 511 broadcast media 276 BT Global Services 381–2, 386, 427, 431–2 Major Customers case study 381–2, 427 social media campaign 301 budgets 63–4, 538 consolidation of 580–1 multinational conglomerates 489 one-year marketing plans 581 size of operations 488 see also forecasts Bugs Burger Bug Killer 462 bureaucracy crisis 499 business benefits 442 business changes 443 business objectives 115–16 business plans 544, 545 Business Process Redesign (BPR) 507 business risk 543, 544 business school case study 211 business strengths/position 202, 247 dealing with 205–6 defining 204, 350, 354, 355 see also SWOT analysis business success through marketing 6, 487–8 615 616 Index business-to-business market 13–14 communications integration 283–4, 295, 302, 307–8 key accounts 341 multichannel consistency 432–3 buy-in, market segmentation 115 buyer segmentation 109, 119 buying company costs 344–5 buying influences communications tools 284–5 multichannel plan 374, 375, 396 personal selling 330 see also purchasing behaviour call centres 384–5, 433, 435, 440 see also channel Canada Dry 45, 243 Canadian SIC system 133–4 capabilities of company 3, 5, 7–8, 9, 30, 205 capital at risk concept 176 capital goods marketing 24–7 pricing 25 purchasing 25–7 capital utilization 261, 263, 462 car market 92, 304, 436–8 carpet manufacturer example 83–5 ‘cash cows’ 195 cash discounts 460 cash flow Boston Matrix 193–4 market segmentation 253 cash objectives 268 categorization of key accounts 351 category management (CM) 179–82 Caterpillar 22 central decisioning, CRM 428 centralization 490, 498, 500–2, 520 ‘certainty and growth’ sector 375, 376 channel chains combining channels 377–8 coverage maps 379–83 CRM 426, 429, 434, 436–8 diagrams 293, 377 see also channels of distribution channel choices 460–1, 470, 474–5 CRM 423, 425, 426, 446 E-marketing 292–3 multichannel plan 371–415 channel consistency, CRM 432–5 channel costs 384–5 channel curves 383–4 channel-independent task management 426 channel selection 372–86 channel strategy CRM 417–18 product lifecycles 184 channels of distribution 460–1, 470, 474–5 see also channel chains chief executive diversification 491–2 expenditure 539 organizational issues 502–5 role of 486, 492–3 strategic planning letter 512, 513 support of 494 client–specialist coordination 334 climate issues, organizational 533 closed-loop planning systems 66, 485, 490 519 cluster analysis 105, 115–16 CM (category management) 179–82 co-branded e-mails 304 Coca-Cola 169–71, 302, 304 cold e-mails 304 collaborative evolution 499, 509 commodity–brand distinction 170–1 communications CRM 425, 428, 436–7 distribution 388–9, 409 four Cs 229 integration 275–326, 425, 427–8, 436–7, 446 communications mix 276 choosing 280–5 digital communications 299–304 personal selling 330–1, 362–3 review 316 communications objectives defining 277–9 setting 286–8 communications plan 275–326 application questions 317 exercises 318–26 review 316 communications tools combining in customer journey 282–5 matching to purpose 280–1 segment media consumption 281 public relations 310–11 companies as brands 176 company benefits 129 company capabilities 3, 5, 7–8, 9, 30, 33–4, 205 competences Boston Matrix 197 directional statements 590 market segmentation 111 mission statements 59 competition communications plan 280 pricing plan 458, 462–5, 468, 470, 474 SBU characteristics 591 value positioning 80 competitive advantage market segmentation 111 product audit 171, 193 strategic marketing plans 49 sustainable 236 value chain analysis 150 value-in-use 462–5 competitive positioning 80, 119, 205 competitive pricing 458, 464, 468, 470, 474 competitive strategies 236–43, 252, 516 competitor analysis 263–4 competitor value positioning 80 computer industry 7, 16 concept see marketing concept confectioners, tobacconists and newsagents (CTNs) 110–11 conglomerates 213, 489–90, 492 consistency of channels 432–5 consolidated budgets 580, 581 consumer attitudes 475 see also attitudes consumer marketing 13–14 consumer purchases demographics 103 organizational issues 506 consumers 13–14, 81–2, 121, 475 definition 81 digital communications 295 as segments 96 wants/needs 229 see also customer contingency plans 581, 582 control cells, advertising 290 control procedures crises 498 marketing audit 60, 175 size/diversity implications 485–7 convenience, four Cs 228 cooperative KAM 347–8, 354 coordinated evolution 509 coordinating role control crisis 499 salespeople 334 copier paper market 108 core products 215 corporate culture 6, 496, 507–9, 518 corporate identity 176 corporate metrics 556 see also metrics corporate objectives definition 230–2 marketing objectives relation 230–1 pricing plan 455, 472–3 review 255 sales force management 337, 339 setting 59 corporate planning 49–57, 230–2 delegation of 508, 509–10 diversification 489 marketing planning integration 509 total process 513 corporate strategy definition 232 correlation, customer satisfaction/ loyalty 117 cost effectiveness, differentiation 241 cost leadership, brands 176 cost-plus pricing approach 458, 459, 468 cost savings key account management 343, 344–5 pricing and 459 costs acquiring customers 419, 420, 421 budgets 63 channel selection 384–5 customer services 398 customer wants definition 41 distribution 388, 410–11 four Cs 228–9 minimizing 40 multichannel consistency 435 one-year marketing plans 582, 585 pricing and 453, 458–60, 464, 465–7, 472 unit costs 191–3 see also expenditure Index 617 coverage maps 379–83, 385, 404–5 Coviello, N 88 Cranfield Customer Management Forum 373, 386, 432, 444, 507 Cranfield School of Management 302, 344, 442, 537–8, 540 Cranfield’s Café Bookshop 417–18 creative evolution 508 crises and solutions 497–9, 508 critical success factors (CSFs) 80, 119, 145, 146 business strengths/position 205–6 communications integration 279 exercises 125–7 outcomes linking 548–50 review 121 scoring 354–5 CRM see customer relationship management CSFs see critical success factors CTNs (confectioners, tobacconists and newsagents) 110–11 cultural sponsorship 312, 313 culture, corporate 6, 496, 507–9, 518 customer audit 139–63 customer behaviour 160 customer-centric CRM 440, 446 customer experience see experience customer-facing needs 205–6 customer journey communications tools in 280–5 E-marketing 292–3 search engine marketing in 299–301 customer needs 139–63 business strengths/position 205–6 market definition 82–5, 105 market segmentation 227 multichannel plan 374–7, 396 SWOT analysis 143–9, 160 customer perceived value 150 customer relationship management (CRM) application questions 444–5 brand names 169 definitions 422 designing 450 exercises 447–50 plan 417–50 review 445–7 social media 303 stage model 422–5 customer retention 244, 419–21 customer satisfaction 8–9, 395 category management 181 multichannel consistency 432–4 polarized attitudes 115 retention and 421 customer services 9, 394–400 audit 411–13 goods firms 397–400, 402–3 package development 399–400, 413–15 review 401–2 social media 302 customer value 160, 439, 446 real meaning of 149–60 customer wants 3, 5, 8–9, 9–11, 12, 28, 30, 31–2 customers 81–2, 121 categorization for KAM 357 competitive strategies 252 definition 81 digital communications 297 gap analysis 244 key accounts 69, 339–50, 357 multichannel plan 372–86, 402 organizational issues 496, 507 product audit 167–8 social media insights 301 status for benefit analysis 136 tracking 289–90 value-in-use 462–5 see also consumer ; market segmentation customization 440–2, 446 damage limitation, public relations 312 data integration, CRM 425–7, 446 data management channel-independent 426 hierarchy of audits 510–11 organization chart model 533 task-independent 425–6 data sheets 511 database systems 42, 423, 424, 425, 426 DBAMs see desk-based account managers DBCs (decisive buying criteria) 119 decentralization 500–2, 520 decision-making central decisioning 428 communications tools 283–5 distribution 394 capital goods 25–7 market segmentation 96, 102–3, 105 marketing objectives 235 pricing 452, 467 decision-making units 22, 283–5 decisive buying criteria (DBCs) 119 decline of markets 190–1, 195 defining markets 4, 78–81, 89–96, 105 Boston Matrix 197 exercises 123–5 significance 110–11 delegated evolution 508–9 delegative leadership 498 Dell 292–3, 297–9 demand competitive strategies 240–1 matching 20 pricing and 452, 454, 458, 466 demographics 89, 103, 112–13, 133–6 design see systems design/ implementation desk-based account managers (DBAMs) 381–2, 386 dialogue see interactive ‘Dialogue’ programme, GM 304, 436–8 differential benefits 129–32, 475 differential strengths 62 differentiation communications integration 280–1 competitive strategies 240–1 customer needs and wants 151, 160 customer services 394 diffusion of innovation 89–92, 187–90, 216–17, 289 digital communications 292–304 see also Internet direct channels, GM programme 436 direct customers 81 direct mail systems 15, 289, 427, 437, 440 direct marketing 280–1, 289, 440 directed evolution 508 Directed Marketing Planning 508 directional policy matrix (DPM) 178, 198–200, 236–8 application 226, 247, 253 case studies 210–14 communications integration 278 exercises 556 key accounts 342 market segmentation 546 portfolio summary 208–9 process explanation 201–8 review 217–18 ten steps to producing 201 directional statements 590 directional terms 235 directive role, planners 494 discounting 64, 460, 470, 476–7, 552 discretionary pricing 467 disintegrating KAM 349–50 disintermediation 109, 298 distinctive competences 59, 111, 197, 590 distribution 52, 371–2, 386–94 aligning interests 389–91 buying influence 374 category management 181 channels of 460–2, 470, 474–5 costs 64 customer services 399 exercises 408–11 importance of 386–7 mapping markets 98, 101 market definition 84 objectives 392, 393 review 401 distribution audit 52, 392–4 distribution mix 387–9 distribution plan 391–4, 401 diversification 57, 245, 247–8, 261, 263, 485–7, 488–95 documentation one-year marketing plans 583–9 strategic marketing plans 568–81 ‘dogs’ 195, 197 downside risk assessment 265, 587 downturns, marketing in 252 DPM see directional policy matrix drivers 442 due diligence 541, 543–5, 554 DVLA communications 296 dynamic interaction, CRM 440, 446 e-commerce 109–11 e-mail marketing 15, 303–4 E-marketing 292–9, 303–4 early majority grouping 91, 187–8 ecological models 50 econometric modelling 291 economic environment 60 economic value 371 economic variables 60 economies of scale 177–8, 191 618 Index ECR (Efficient Customer Response) 179 effectiveness 47, 49 advertising media 289–91 application questions 553–4 cost effectiveness 241 exercises 555–9 measuring 537–60 metrics 289–91 review 554 efficiency 47, 446 Efficient Customer Response (ECR) 179 emotions 174, 396, 402 empathy 396, 402 employee satisfaction 395 enabling changes 443 engineering company case study 211–12 enter decisions 235, 264 environmental issues 494–5 see also economic environment; marketing environment estimated replacement date (ERD), cars 436 estimating expected results 63 European SIC system 133 European single market 178–9 events, public relations 310 evolutionary phases corporate culture 507–9 crises 498–9 ‘excellence’ 246 exchange potential, communications 294 executive role, competitive strategies 246 exhaust revenues 114 existing activity reviews, sponsorship 314 exit decisions 235 expenditure 538–9 fast moving consumer goods 540, 551 lag/lead indicators 550, 551 see also costs experience effect 191, 241, 454, 515 experience quality, customer services 395–6, 401–2 expert opinions, public relations 311 exploratory KAM 346, 354 export strategies 593 external audits 60 external risks 343 facilities for distribution 388, 408–11 FADS 92 failure integration of planning 509 market segmentation 113–14 reasons for 56–7, 493 family lifecycle analysis 135 fast moving consumer goods (FMCG) 10, 540, 551 fertilizer market case study 82, 94 field sales force 381–2 First Direct 429 fifth crisis/solution 499–500 financial audit 52 financial drivers, selling companies 344 financial goals, SBUs 592 financial history, SBUs 590 financial objectives 51–2 financial outcomes, KAM 358–9 financial projections 571, 580 financial ratios 582 financial services case studies 431 see also banking operations financial-trust organizations 502 first crisis/solution 497–8 First Direct 240, 372, 384, 421, 429 Five Forces (Porter’s) 203 FMCG see fast moving consumer goods force field analysis theory 523–4, 524–6 Ford 176 forecast matrix 356 forecasts 41–2, 488 diffusion of innovation 188 DPM 207–8 key account management 356 multinational conglomerates 489 one-year marketing plans 581 size of operations 488 formalization 22 formalized plans 57–8, 66, 486–7, 488, 490–1 four Cs 228–9 fourth crisis/solution 499 full absorption costing 458 functional-level planning 66, 485 see also marketing function functional redesign value 465 functionality of brands 175 future goals directional statements 590 market segmentation 109–11 organization chart model 531–2 gap analysis 243–7, 248, 255–6, 258–63 General Motors 304, 427, 436–8 generic strategies matrix 44–5, 241 geodemographics 89, 135 geographic benefit analysis 134, 135 geographic boundaries, markets 97 Gillette 169, 170 global brands 176–9 globalization, market definition 98 GlobalTech case study 113–21 goods firms 397–400, 402–3 see also products government targets, public services 44 growth of companies 496–7, 499, 545 growth of markets 93–4 guide to 224–5 product audit 182, 186, 190–1, 193, 194–6, 197, 202 growth rate DPM 202 guide to 224–5 key accounts 352 ‘halo’ effect, brands 176 harvest decisions 235, 264 headquarters centralization/decentralization 502 diversification effects 492 line management relations 494 planner relationship 492 SBU consolidation 590 health services 68–9 HFs (hygiene factors) 550, 551 hierarchy of audits 510–11 hierarchy of planning 64, 69, 140 high relative market share definition 194 high-value customer channels 373 historical background organization chart model 531 SBUs 590 homogeneity of product/market 489 horizons see planning horizons hotel industry 377–8 hygiene factors (HFs) 550, 551 IBM 7, 240 ICI 242 impersonal communications 275 see also advertising implementation issues 485–536, 543–4 application questions 519 exercises 521–36 review 519–21 see also systems design/ implementation implementation risk 543, 544 improve decisions 235, 264 inbound channels 304, 440, 446, 448 inbound e-mails 304 incremental expenses 64 incremental value, intangibles 464 independence of location, communications 296–7 indirect channels 426, 436 see also intermediaries individualization 295–6, 422–4, 427, 435, 436–8, 439, 446 individuals formalized systems 490 profiling 134–6 tracking for advertising 289–90 industrial marketing 21–2 industrial purchases/goods demographics 103 exercises 127–8 market segmentation 566–7 sales plan 329 industry restructuring 298–9 industry-wide success factors 205 information access to 423, 445–6, 511 communications integration 280, 284, 294, 295–6 flows intelligence and 517 needs 22 personal selling 330 transfer of 492 information-enabled tailoring 295–6 information technology (IT) budgets 538 CRM and 419, 422 IS/IT enablers 443 multichannel plan 376–7 personal selling 331 product lifecycles 185 Index 619 informed strategies, communications 297–8 innovation diffusion of 89–92, 187–90, 216–17, 289 digital communications 298–9 diversification 490 innovators 89, 187, 189, 289 inputs, market segmentation 550 insurance companies annuity market 374–7 channel curves 383 market maps 374 sales plan 329 intangibles 18, 464, 542, 545 integration communications 275–326 CRM 425–35, 445 distribution management 391–4 E-marketing 292–3 key account management 349, 354 planning systems 275–326, 506, 509 integration maturity 423, 425–35, 445, 448, 449 intelligence definition 517 intelligent dialogue 297–8, 424, 446 interaction maturity 423, 435–42, 445, 448, 449 interactive communications 276, 293–5 interactive media 276 interdependence industrial markets 22 key account management 348, 354 top-down/bottom-up process 513, 514 intermediaries channels of distribution 460–2 CRM 421 digital communications 298 distribution 378, 391 evaluation criteria 391, 407–8 exercises 405–8 market segmentation 109–10 internal audits 60 internal needs, market segmentation 114 internal risks 343 Internet 292–304, 371–2, 380 channel chain variation 384 CRM programmes 436–8 sales 56 interpretative models 50 inventory levels, distribution 388, 409, 410 investments 538–9, 542 due diligence 545 objectives 267–8, 443 promotional expenditure 552 return on 40, 82, 83, 315, 547, 552 ISOs IT see information technology Japan 192, 193 ‘joined up’ marketing see integration Journal of Marketing Management 88, 89 junctions, market maps 98–102 KAM see key account management key account attractiveness definition 350, 352–3 weight allocation 353 key account management (KAM) benefits of 343–5 definition 341–2 importance of 358 in industrial marketing 23 objectives 356–7 portfolio planning 350–8 relationship development 345–50 review 360–1 selling and 339 key account manager, definition 342–3 key accounts attractiveness 350, 352–3 definition 67, 341 planning position 68–9 population list 351 preliminary categorization 351 key activity planner 582, 589 knowledge investments 539 of personnel 532–3 technology/markets 488 ‘10S’ approach 516–18 transfer of 492 Kodak lag indicators 547, 550, 551 laggards 188 Lanchester’s Square Law 243 large companies 488 diversification 492 hierarchy of audits 513 marketing function 487, 522 multichannel consistency 433 planning horizons 495 late majority grouping 91, 187–8 launch prices 458 lawn mower market 103 lead indicators 547, 550, 551 leadership crises 497–8, 508 visionary models 50 learning curves 191 legislation leverage points, maps 100, 103, 103 life phases of organizations 496–507 lifecycle analysis 210–14, 210–15 lifecycles advertising objectives 288 Ansoff Matrix 245 exercises 222–5 marketing audit 60, 91, 95–6, 135, 182–6, 189, 190, 209–15 pricing plan 456–7, 469, 473–4 lifestyle studies 134, 136 lifetime costs, products/services 464 line management 494 local brands 176–9 local focus, market definition 98 location independence, communications 296–7 logical incremental models 50 logistics see distribution long-range planning 51, 53, 490 loss situations, KAM 344 loyalty cards 424 loyalty of customers 115, 117–18, 282, 283, 395, 434 lubricants market 511 McDonald’s 241 maintain decisions 235, 264 maintenance, repair and operation (MRO) contracts 463 maintenance expenditure 551–2 Major Customers case study (BT) 427 management audit 51–2 management processes category management 179–82 centralization versus decentralization 500–2 CRM 303, 417–50 diversification 488–93 integrated distribution 391–4 marketing audit 568 marketing plan development 40 objective-setting 231 operational/strategic separation 485–6, 494 physical distribution 386–94 planner role 492 sales force 328–9, 336–7, 337–9, 360, 365–8, 380, 381–2, 502, 503 shared values 516 size of operations 488 sponsorship 314 see also data management; key account management; product management; top management manager role 342–3, 492 managerial orientation 46, 48 manpower issues 593 manufacturing companies 13 Boston Matrix 195 CRM 436–8 customer services 399 distribution 386 market definition 83–4 retailer relationship 180–1 map of marketing 4, 28, 29, 79, 166 accountability framework 541 objective-setting 228 positioning marketing 55–6 mapping markets 61, 79, 89–91 future options 109–11 industry restructuring 298–9 methodology 98–102 multichannel plan 373–7 margin management 460–1 marginal costings 458–60 marine market segments 567 market attractiveness 118–19, 201–4, 208–9, 237 market audit 77–137 market-based performance, forecasts 43 market characteristics, SBUs 591 market-driven research and development 12 market definition 4, 78–81, 89–96, 105 Boston Matrix 197 exercises 123–5 market extension 247–8 market leverage points 100, 103, 103 620 Index market maps 61, 79, 89–91 definition 98 future options 109–11 industry restructuring 298–9 methodology 98–102 multichannel plan 373–7 market orientation see marketing concept market overview documentation 572 strategic plan 60–1 market penetration 259–60, 262 market research 141–3, 175 market risk 543, 544 market segmentation 9, 13, 61, 89–96 case studies 112–21 communications integration 278–9, 281 customer retention 420 DPM 200 effectiveness measurement 541, 545, 546, 550 examples 108 future options 109–11 methodology 96–108 metrics 556–7 multichannel plan 373–7, 383–4 organizational issues 506, 507 process summary 106 product audit 173 product market segments 574 quick solution 107–8 review 122 significance 111, 192–3 step-by-step plan 565–7, 574 value propositions 79, 227 valuing segments 252–3 market share 82–5, 191–3 Boston Matrix 193–4, 196–7 competitive strategies 239 pricing plan 453–4 product lifecycles 183–6, 209–10, 225 review 121 market size factors 188–9, 202 market structure 106, 517 market variables, marketing audit 60–1 marketing confusion about 10–12 definition in downturns 252 methods 14–16 positioning planning within 54–7 role in business marketing audit 52, 59–61, 77–137, 488 application questions 121 completing 165–226 exercises 123–37 review 122–3 step-by-step plan 565–8 marketing channels see channel marketing concept 3–4, 21, 26, 29 marketing department role 6, 13–15, 55, 503, 506 need for 27–8 marketing due diligence (MDD) 541, 543–5, 554 marketing environment 7–8, 30, 34, 495, 517 marketing expenditure 538–9, 540 see also expenditure; marketing spend evaluation marketing function 4–5, 486 confusion about 10–12 line management 494, 529, 530 market segmentation 106 review 29–30 marketing investments 538–9 marketing logistics see distribution marketing map see map of marketing marketing mix 3, 9–10, 63, 289–90 marketing objectives application questions 255 definition 230–2 documentation 577–9 exercises 258–71, 318–19 one-year marketing plans 581 profitability 252–4 review 255–8 sales force management 337, 339 setting 62–3, 207, 210, 227–71 Marketing Partners 27 marketing planning alternatives 63 application questions 28–9, 70 barriers to 515–18, 520 benefits 73–4 corporate planning relation 49–57 definition 40, 562 effectiveness measurement 537–60 exercises 72–4, 521–36 manager role 493 myth removal 485–7 objectives 40–1, 62–3 principles of 519 process 57–65, 507–9, 562 main steps 39–74 purpose of 562 questionnaire 528–34 review 70–1, 519–21 size/diversity implications 485–7 step-by-step system 561–97 summary 561–2 systems design/implementation 66, 562–97 marketing process 3–36 marketing spend evaluation 554 see also marketing expenditure marketing strategies 227–71 application questions 255 documentation 577–9 exercises 258–71 review 255–8 SBUs 593 setting 63, 207, 210, 227–71 markets Ansoff Matrix 233–4 attractiveness factors 118–19, 201–4, 208–9, 237 channel chain variation 379–83 competitive strategies 236 decline of 190–1, 195 DPM process 201–3, 204 gap analysis 244 growth of 93–6 guide to 224–5 product audit 182, 186, 189–90,   194–6, 197, 201–2 hierarchy of audits 510–11 homogeneity of 489 key account position 69 knowledge of 488 marketing objectives 62–3 new markets 261, 263 organizational issues 503–4, 508 Porter’s matrix 44–5 Marks & Spencer 344 matching company capabilities/ customer wants 3, 7–8 matching demand 20 matrix organizations 504 maturity CRM 422–44 markets 93, 96, 182, 186, 190–1, 224–5, 236 MDD see marketing due diligence ‘me too’ products 96 measuring methods application questions 553–4 effectiveness of planning 537–60 exercises 555–9 multichannel consistency 432–5 review 554 sales workloads 331–2 media communications 276, 281, 289–91, 312, 313, 320–2 see also digital communications media sponsorship 312, 313 medium-sized companies 487, 522 metrics integration 289–91, 425, 432–5, 446 modelling 547, 550–1, 556–7 Mexican SIC system 133–4 micro marketing 16–17 micro-segments 102, 103, 104–5, 132–7 microsites 438 middle management 488 mission statements 58–9, 72–3, 569 Mitchell, Alan 27 monitoring processes sales performance 366 MOSAIC classifications 136–7 motherhood-type mission statements 58, 144 motivation of sales force 336–7, 366–8 motorcycle industry 193, 453–4 multichannels consistency measurement 432–5 plan 371–415 process integration 292–3, 429–31 multidemographic criteria 135 multinational conglomerates 489–90, 492 multiplier effect 492 ‘must’ objectives 243 Nationwide bank 424 Nectar cards 424 needs see customer needs; internal needs negotiation 295 net present value (NPV) 552 neutral marketplaces 109 new markets 261, 263 new product development 190–1, 245, 247–8, 261, 263 newness decisions 285 news generation 310 Index 621 non-cumulative diffusion pattern 187, 189 North American SIC system 133–4 Northern Sealants Limited 504, 505 NPV (net present value) 552 O2’s Vision system 441 objective/strategy setting advertising 286–8, 316, 319–20 application questions 255 brands 172 communications 277–80, 286–8, 307–8, 313, 316 corporate planning 52, 59, 230–2 distribution 392 documentation 577–9 DPM 207, 210 exercises 258–71 key account management 356–7 market segmentation 114–15 in marketing 62–3, 227–71 one-year marketing plans 581–2 pricing 455, 472–3 review 255–8 sales plan 337–9 sales promotion 307–8, 317 sales role 332–4, 362–5 SBUs 591–2 sequencing objectives 518 sponsorship 313 objectives priority matrix 518 OEMs (Original Equipment Manufacturers) 436–8 ‘offers’ in pricing plan 451, 458 office equipment market 101, 102 one-year marketing plans 48, 52, 516 documentation 583–9 format suggestion 582 guidelines for completion 581–90 see also operational planning; tactical marketing plans online communications see digital communications; Internet open-loop points 513 operating results, one-year plans 582, 588 operating unit definition 508 operational marketing plans 46–8, 63, 66 operational planning 46–8, 63–4, 66 diversification 490 hierarchy of audits 513 organizational issues 506–7 separation from strategic 485, 519 timetable 592–4 see also one-year marketing plans; tactical marketing plans operational variables, marketing audit 60 operations audit 52 gap 256 marketing role in 516 opinion leaders 91, 187, 289 opinion-shaping 312 opportunities, threats and issues (OTIs) 119, 247–8 see also SWOT analysis organization chart model 531–4 organizational issues 495–6 barriers 520 board level 502–5 exercises 528–34 life phases 496–507 operational level 506–7, 593 questionnaire 528–34 Original Equipment Manufacturers (OEMs) 436–8 OTIs see opportunities, threats and issues outcomes/activities/attitudes linking 547–50 overplanning problem 486 own label products 180, 181 package of benefits 218–22, 399–400, 413–15 ‘paid search’ marketing 299–301 paper company case study 358 Pareto effect 85–7 partial channel substitution 109 path-goal approach 337 PDM (physical distribution management) 386–94 peer-to-peer interactions 396, 402 penetration policies 466, 467 performance forecasts 43 sales force 335, 338, 365–6 SBU summary 570 standards of 234, 335, 338, 365–6 strategy links 49 perishability of service 20 personal communications 275 see also personal selling personal intervention, chief executive 493 personal selling 14–15, 280, 285, 289, 328–31, 359, 362–3 personality brands 174–5 companies 136 individuals 136 personalized presentations 491 personnel audit 52 knowledge of 532–3 see also manager role; planners; sales force/salespeople persuasion 280–1, 288, 295 PFs (productivity factors) 550, 551 pharmaceutical market 101, 205, 465 photocopier market 94–5, 184 photography market physical distribution 371–2, 386–94, 401, 408–11 pilot studies, channel models 385–6 PIMS (Profit Impact of Market Strategy) 49 place 250–1, 257, 371 diversification and 492 objectives 63 see also 4Ps planners delegating to 508–9 role of 493–4 team meetings 592–3 planning cycle 494, 594 key account position 69 objective-setting 52 value propositions 79 planning department role 493–4 planning horizons 494–5, 519 planning models 50–1 see also marketing planning planning paradox 519–20 planning team meetings 592–3 planning terms 255 plans for planning, lack of 520 points schemes 307 polarized attitudes 115 policy development, sponsorship 314–15 political dimension, corporate culture 509 political models 50 population list, key accounts 351 Porter, Michael 44–5, 150, 154, 155, 236, 241 Porter’s Five Forces 203 Porter’s generic strategies matrix 241 portfolio analysis 237, 350, 546, 556, 575 portfolio matrix 215, 237, 355–6, 473 see also directional policy matrix portfolios analysis 237, 350, 546, 556, 575 creating 199–209 exercises 556 key account management 340, 350–8 market segmentation 546 pricing 455, 473 products 190–1, 195–6, 217, 242, 243–4, 455 SWOT analysis 575 positioning businesses 310, 311–12 see also business strengths/position; competitive positioning positioning products/services 106, 119 brands 172–3, 177 category management 180 DPM 238 pricing 457, 469, 474 Post-it notes 184 potential competition, pricing plan 458, 474 preliminary categorization, key accounts 351 present values (PVs) 252, 552–3 presentations 491 price 250–1, 257 branding 174, 176 competitive strategies 240 cutting prices 454, 476–7 diversification and 492 factors affecting 467, 470 market segmentation by 93–4, 277 objectives 63 product lifecycles 183 reduction effects 454, 476–7 selecting 472–6 value propositions 228–9 see also 4Ps pricing models 252 pricing plan 451–81 application questions 468 exercises 471–81 preparing 465–7 questionnaire 478–9 review 468–70 622 Index prioritizing objectives 518 problem formulation 488 process integration, CRM 425, 428–31, 446 Procter & Gamble 82, 170, 177, 301–2, 538 product audit 78, 79, 165–226 application questions 215 exercises 218–26 review 215–18 product lifecycles 182–6 advertising objectives 288 Ansoff Matrix 245 diffusion of innovation 187–8, 190 exercises 222–5 marketing audit 60, 92, 95–6, 210–14 portfolio combination 209–10 pricing plan 456–7, 469, 473–4 product management 9, 11, 167 product portfolios 190–1, 195–6, 199–209 competitive strategies 242, 244 DPM 207, 210–14 lifecycle combination 209–10 pricing plan 455, 456 summary 208–9, 217 ‘product surround’ 169, 215 production distribution and 386 innovation diffusion 91–2 productivity factors (PFs) 550, 551 productivity improvements 243–4, 259, 261–2, 335 products aggregating 82–5, 98 Ansoff Matrix 235, 259–63 channel chain variation 379–83 classification 45 customer retention 421 customer services 397–400 definition 167–70, 215 diversification 492 DPM process 202, 204, 207 fit for purpose 108 homogeneity of 489 lifetime costs reduction 464 market audit 127–8 market segmentation 89, 96, 574 marketing objectives 63, 250–1, 257 organizational issues 496, 501–2 positioning 106, 119, 172–3, 177, 180, 238, 457, 469, 474 process integration 428–31 transactional 445 see also 4Ps; services profiling benefits 133–4 CRM maturity 447–9 individuals 134–6 profit 49, 53 Boston Matrix 193 competitive strategies 246 definition 40 forecasting 207 gap analysis 258–63 maximization policy 210 potential for 202–4, 352 service-profit chain 394–5 Profit Impact of Market Strategy (PIMS) 49 profit and loss accounts 53 profitability 489, 502 channel selection 373 customer services 398 customer value orientation 439 customer wants 8–9 market share and 193, 196 marketing audit 211–12 marketing objectives 252–4 Pareto effect 86 pricing and 452–5, 459, 460, 462 retaining customers 419, 420 promotion 250–1, 257, 280, 304–16, 460 checklist 309–10 diversification 492 effectiveness measurement 540–1, 551–3, 554 exercises 322–6 objectives 63, 64 product lifecycles 183 spend evaluation 554 see also 4Ps promotional discounts 460 pseudo brands 171–2 psychographics 134, 136 public relations 310 communications tools 310– scope of 311–12 public service targets 44 public transport companies 11 publications, public relations 310–11 purchasing behaviour benefit analysis 136 communications tools 284, 285 market segmentation 89, 103, 102–3 see also buying influences purchasing channels 434 purpose statements 58 ‘push-based’ marketing models 294 PVs see present values qualitative objectives, sales 333–4 qualitative studies 114, 115 quantitative objectives, sales 334, 364–5 quantitative studies 114, 116, 117, 118, 332 quantity discounts 460 question formulation, objectivesetting 258 ‘question marks’, Boston Matrix 194–5 questionnaires 528–34 rapid growth stage, markets 93, 94 Rappaport, Alfred 150, 151 rational appeal, brands 174 reachability, markets 119 recessions 251 red-tape crisis 499 reference files 568 reference theory 187 reinforcing tools, communications 280 reintermediation 109, 298, 299 relationship marketing 150, 310 relationships building 302, 396, 402 customer value 150 key account management 340, 345–50 public relations 310, 311–12 see also customer relationship management relative market share 194–5 relative value 153 reliability, customer services 396, 402 remuneration key account managers 342 sales force 336–7 repertory grid 464 representationality, brands 175, 176 representatives, operational planning 506 requisite planning 486–7, 510 hierarchy of audits 513 levels of 66–8 research and development 11–12 see also market research resource availability, organization chart model 532 responsiveness, customer services 396, 402 retailers/retailer trends 15, 42 category management 179–82 channel chain diagrams 293 econometric modelling 291 independence of location 296 personal selling 331 retention of customers 244, 419–20 return on capital employed (ROCE) 213 return on investment (ROI) 40, 83, 315, 547, 552 return on net assets (RONA) 45–6 return on sales (ROS) 203, 213 revenue definition 40 exhaust revenues 114 gap analysis 258–61 reviews, sponsorship 314, 315–16 Rigby, D 88 risk assessment 587 market segmentation 252, 253 reduction 343 shareholder value added 543–4 ROCE (return on capital employed) 213 Rogers, Everett 90–2, 187 ROI see return on investment RONA (return on net assets) 45–6 ROS see return on sales routines 532 running reference files 568 sales 10–11 advertising plan 286, 289 category management 179 digital communications 295 growth options 244 innovation diffusion 92 interaction maturity 435 Internet 56 key account management and 339 market definition 84 multichannel plan 380, 381–2 objective-setting 231, 243–4 Pareto effect 86 Index 623 product audit 167, 179, 182, 213 weighted average return on 204 sales force/salespeople key account managers 342–3 management 328–9, 336–7,   337–9, 360 channel chains 381–2 exercises 365–8 organizational issues 502, 503 review 359–40 number required 331–2, 359 objectives 337 productivity improvements 335 role determination 332–4, 359–60, 362–5 sales forecasts 41–2, 488, 207, 488 sales plan 327–68 application questions 361 exercises 362–8 preparing 337–9 review 359–61 sales promotion 280, 304–16 definition 304–5 exercises 322–6 objectives 308–9, 317 plan preparation 308–9, 317, 325 strategic role 307 types 306–7 salespeople see sales force/ salespeople satisfaction see customer satisfaction SBUs see strategic business units scenario analysis 429–30, 495 scoring attractiveness factors 353 critical success factors 354–5 key account management 350, 353, 354 pricing exercises 478–9 search engine marketing 299–301 search engine optimization (SEO) 300, 301 SEC see socio-economic classification second crisis/solution 498 sector definition 89 segments attractiveness factors 118 case studies 116–17 communications matching 280 definition 89 developing 96–108 DPM 200 forming 104–7 multichannel plan 373–7, 383–4 organizational issues 506 valuing 252–3 see also market segmentation selective objectives 268 selling companies cost savings 344–5 financial drivers 344 see also sales senior management see top management sensual appeal, brands 174 SEO see search engine optimization service delivery 20 service marketing 12–13 see also services service-profit chain 394–5 service quality definition 395 experience quality versus 395–6 services 12–13 aggregating 82–5, 98 capital goods 24–7 classification 45 communications plan 284, 285 customer retention 421 definition 17–21 DPM process 202, 204 examples 17 industrial products 21–4 lifetime costs reduction 464 market audit 127–8 market segmentation 89, 108, 112–21 marketing 17–21 positioning 106, 119, 172–3, 177, 180, 238 process integration 428 as products 167 quality 395 value-in-use 462–5 see also customer services; products SERVQUAL 396 shared values principle 516 shareholder value added (SVA) 150, 151, 537, 542–7 short-term planning see operational planning SIC (Standard Industrial Classification) 133–4 single-channel businesses 373, 417–18 single-customer view 426 size factors effect on marketing planning 485–7 market size 188–9, 202 medium-sized companies 487, 522 operations 487–8 small companies 487–8, 492, 495 see also large companies SKF 154, 155 skills line managers 494 organization chart model 532 ‘10S’ approach 516–18 skimming policies 466, 467 small companies 487–8, 492, 495 Smith, Adam Smith, Wendell 88 social media 301–3 social sponsorship 312, 313 socio-economic classification (SEC) 89, 103, 135 Sodium Tri-Poly Phosphate (STPP) 112–13 soft factors, KAM 352 specialist–client coordination 334 spend evaluation 554 sponsorship 312–16 sports sponsorship 312, 313 standard benefits 129, 133–4 Standard Industrial Classification (SIC) 133–4 standardization process, diversification 493 standards of performance 234, 336, 338, 365–6 ‘stars’ Boston Matrix 195 key account management 357 statistics, SBUs 591–2 status customers 136, 357 step-by-step marketing planning system 561–97 STPP (Sodium Tri-Poly Phosphate) 112–13 strategic business units (SBUs) 179, 199–200, 205–6 definition 199–200, 507 headquarters consolidation 590 performance summary 570 step-by-step plan 564, 568, 591–2, 593 strategic customers 357 strategic marketing plans 44, 46–8 10 steps 58–65 barriers to integration 67 content 65–6, 78, 229, 562, 563 documentation 568–81 marketing audit 78, 565–8 quality testing 594–6 requisite 66–8 SBUs 564 summary 561–2 timing 68 value propositions 229 variables 243–7 strategic planning chief executive’s letter 512, 513 separation from operational 485, 519 total corporate process 513 strategies brand strategy 172, 176 centralization versus decentralization 501 channel strategy 184, 417–18 competitive strategies 236–43, 252, 516 corporate planning 49–57, 230–2 critical success factors 548–9 development 119–21, 314–15 digital communications 297–8 generic matrix 44–5, 241 implementation 119–21 key account management 357–8 marketing 62–3, 207, 209, 227–71 documentation 577–9 one-year marketing plans 582, 584–5 planning cycle 594 sales promotion 307 SBUs 591–2, 593 ‘10S’ approach 516 see also objective/strategy setting strategic purchasing 152 strategy gap 256 strategy risk 543, 544 streamline customers 357 strengths of businesses 202, 204, 247, 350, 354, 355 see also SWOT analysis structural issues, organizational 533, 534–5 624 Index structure integration, CRM 425, 421–2, 446 style principle, ‘10S’ approach 518 subsidiaries 492, 495, 500–1 success factors brands 171–2, 179 businesses 6, 487–8 industry-wide 205 see also critical success factors supplier segmentation 109 supply chain 13, 26 see also distribution supply and demand strategies 240–1 support role/levels market segmentation 108 planner 494 ‘surround’ (‘product’) 169, 215 sustain objectives 268 sustainable competitive advantage 236 SVA see shareholder value added SWOT analysis 61–2, 140, 233, 247–8 ‘10S’ approach 517 customer needs and wants 143–9, 160 documentation 573, 575 DPM 213–14 hierarchy of audits 510–11 market segmentation 111, 120 meaningful 145–9 portfolio summary 575 see also opportunities, threats and issues synergy 247, 500, 501 systematization of process 518 systems design/implementation 66 exercises 521–36 problems 500–3 step-by-step system 561–97 tactical marketing plans 46–8, 64–5, 66 see also operational planning tactics 5, 249–50, 307, 516 tailoring see individualization tangibility, customer services 18, 19, 396, 402 targets, public services 44 task-independent data management 425–6 task-related budgeting 581 team exercises 558–9 technology innovation diffusion 91 knowledge of 488 marketing environment product lifecycles 182, 186, 225 research and development 11–12 telecoms providers 380, 381–2, 500 see also BT ‘10S’ approach to barriers 516–18 Tesco 171, 244 testing marketing plans 594–6 Tetrapak 155, 157 third crisis/solution 498–9 threats see opportunities, threats and issues three-level accountability framework 537–8, 540–53 timing/timetables operational plans 529–3 pricing and 456 strategic/tactical marketing plans 68 top-down approach 509, 513, 593–4 top management centralization/decentralization 500–2 diversification 491 hierarchy of audits 510–11 size of operations 488 support 494 total channel margin 460–1 total corporate process 513 total spend method 352 tracking customers 289–90 trade discounts 460 trade-offs, distribution 388, 392, 394 training, sales performance 366 transactions, market segmentation 102–3 transport 388, 409 travel industry 384–5, 424, 430–1 tyre company case study 278–9 UK SIC system 133 undiversified companies, definition 488 unit costs 191–3 unit mission statements 569 United Kingdom (UK) SIC system 133 United States of America (USA) SIC system 133–4 unitization 389, 409 USA SIC system 133–4 usage processes, experience quality 396, 402 utilitarian values, brands 174, 175 value accounting 150, 151 definition 150–60 perception of 150 relative 153 value added 150, 151, 170, 179 definition 539–40 experience effect 191 mapping markets 98, 101 shareholder value 150, 151, 537, 542–7 value added chain 98, 101 value chain, differentiation 156 value chain analysis 150, 155 value chain management 16 value-in-use 462–5 value propositions 4, 55–6 brands 176 creating 228 definition 153–4 determining 227–9 key accounts 352 market segmentation 79, 227–8, 252–3 pricing and 464 process 159 quantifying 156, 158 values customer orientation 439 shared 516 vendor segmentation 109 ventromedial prefrontal cortex (VMPC), brand preference and 140 viral marketing 303–4 virtual streams 371 visionary leadership models 50 visual identity, public relations 311 Wal-Mart 82 walkthrough scenarios 429–30 wants see customer wants weaknesses of business 247 see also SWOT analysis weighted average return on sales 204 weighting systems key account attractiveness 353 profit 202, 203 SWOT analysis 247–8 wholesaler personal selling 331 ‘wildcats’, Boston Matrix 195 Wilson, H 88 Wind, Y 88 Winkler, John 478 win–win offers 440 Woolworths of Australia 457 workflow management 428 workload of salespeople 311–12 workshop team exercises 558–9 written objectives/strategies 488, 497, 518 WILEY END USER LICENSE AGREEMENT Go to www.wiley.com/go/eula to access Wiley’s ebook EULA ... Cataloging-in-Publication Data Names: McDonald, Malcolm, author | Wilson, Hugh, author Title: Marketing plans: how to prepare them, how to profit from them / â•… Malcolm McDonald, Hugh Wilson Description: Eighth... Marketing Plans Eighth Edition Marketing Plans How to Prepare Them, How to Profit From Them Eighth Edition Malcolm McDonald Hugh Wilson This edition first published 2016 © 2016 Malcolm. .. firms to get to grips with it in a practical and down -to- earth manner This book explains what marketing is, how the marketing planning process works, how to carry out a marketing audit, how to set