Lecture 2

Developing Marketing Strategies and Plans

“It is more important to do what is strategically right than what is immediately profitable.” – Philip Kotler

Marketing and Customer Value

The Value Delivery Process

Three phases of value creation and delivery sequence :
1. Choosing the value represents the “homework” marketing must do before any product exists.
 Marketers must segment the market, select the appropriate target, and develop the offering’s value
positioning. The formula “segmentation, targeting, positioning (STP)” is the essence of strategic
marketing.
2. Providing the value wherein Marketing must determine specific product features, prices, and distribution.
3. Communicating the value by utilizing the sales force, Internet, advertising, and any other communication tools
to announce and promote the product.

The value delivery process begins before there is a product and continues through development and after launch. Each
phase has cost implications.

The Value Chain

 Michael Porter proposed the value chain as a tool for identifying ways to create more customer value.
 Every firm is a synthesis of activities that are performed to design, produce, market, deliver, and support its
products.
 The value chain identifies nine strategically relevant activities that create value and cost in a specific business.
These nine value-creating activities consist of five primary activities and four supporting activities.

 Firm infrastructure

Human resource management

Support Margin
Activities
Technology development

Procurement

Inbound Operations Outbound Marketing Service

logistics logistics and sales Margin

Primary Activities

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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  The primary activities represent the sequence of bringing materials into the business (inbound logistics),
converting then into final products (operations), shipping out final products (outbound logistics), marketing
them (marketing and sales), and servicing them (service).
 The support activities – procurement, technology development, human resource management, and firm
infrastructure – are handled in certain specialized departments, but not only there.

 The firm’s task is to examine its costs and performance in each value-creating activity and to look for ways to
improve it.
 The firm’s success depends not only on how well each department performs its work, but also on how well the
various departmental activities are coordinated.
 The firm must place more emphasis on the smooth management of core business processes.

 Core business processes:

1. The market sensing process: All the activities involved in gathering market intelligence, disseminating it
within the organization, and acting on the information.
2. The new offering realization process: All the activities involved in researching, developing, and launching
new high-quality offerings quickly and within budget.
3. The customer acquisition process: All the activities involved in defining target markets and prospecting
for new customers.
4. The customer relationship management process: All the activities involved in building deeper
understanding, relationships, and offerings to individual customers.
5. The fulfillment management process: All the activities involved in receiving and approving orders,
shipping the goods on time, and collecting payment.

 The Value-Delivery Network

 Also called supply chain
 To be successful a firm needs to look for competitive advantages beyond its own operations, into the value
chains of its suppliers, distributors, and customers.

Core Competencies
 To efficiently and effectively provide value to customers the key, then, is to own and nurture the resources and
competencies that make up the essence of the business.
 Core competency is what a firm does better than anyone else, its distinctive competence (just part of sustainable
competitive advantage).
 Three characteristics:
1. It is a source of competitive advantage in that it makes a significant contribution to perceived customer
benefits
2. It has a breadth of applications to a wide variety of markets
3. It is difficult for competitors to imitate

 Competitive advantage is a company’s ability to perform in one or more ways that competitors cannot or will not
match. It also accrues to companies that possess distinct capabilities. Whereas core competencies tend to refer to
areas of special technical and production expertise, distinctive capabilities tend to describe excellence in broader
process.

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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 Competitive advantage ultimately derives from how well the company has “fitted” its core competencies and
distinctive capabilities into tightly interlocking “activity systems.”

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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The Central Role of Strategic Planning
 As a marketer, how do you create and retain customer satisfaction and at the same time continuously adapt to the
ever-changing marketplace?

Market-Oriented Strategic Planning is the managerial process of developing and maintaining a viable fit
between the organization’s objectives, skills and resources and its changing market opportunities.

The aim of strategic planning is to shape and reshape the company’s businesses and products so that they yield
target profits and growth.

 Strategic Planning calls for action in three key areas:

1. Managing a company’s businesses as an investment portfolio.
 Each business has a different profit potential, and the company’s resources should be allocated accordingly.
2. Assessing each business’s strength by considering the market’s growth rate and the company’s position and fir
in that market.
3. Establishing a strategy.

 For each business, the company must develop a game plan for achieving its long-run objectives.

Levels of Strategic Planning (Operational Strategic Planning Process)

To understand marketing management, we must understand strategic planning. And to understand strategic planning,
we need to recognize the most large companies consist of four organizational level:

1. Corporate Strategic Plan (usually a 5-year plan)

 Corporate headquarters is responsible for designing this plan.
 It guides the whole enterprise into profitable future.
 It makes decisions on how much resource support to allocate to each division, as well as which businesses
to start or eliminate.

2. Division Plan (usually a 5-year plan)

 Each division established division plan covering the allocation of funds to each business unit within the
division

3. Business Unit Strategic Plan (usually a 2 to 3-year plan)

 Each business unit develops their own plan to carry the business unit into a profitable future

4. Marketing Plan (product/brand plan and usually a year to 3-year timeframe)

 Marketing Plan is the central instrument for directing and coordinating the marketing effort

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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Levels of Marketing Plan
 Strategic Marketing Plan
 It develops the broad marketing objectives and strategy based on the analysis of the
current market situation and opportunities.

 Tactical Marketing Plan

 It outlines specific marketing tactics, including advertising, merchandising, pricing,
channels, service, and so on.

Corporate
Planning Organizing Measuring
results

Division Implementing
Planning
Diagnosing
results
Business
Planning

Taking
Marketing corrective
Plan (Product action
Planning)

Corporate and Division Strategic Planning

 All corporate headquarters must undertake four planning activities
1. Defining the corporate mission
2. Establishing strategic business units (SBUs)
3. Assigning resources to each SBU
4. Planning new business

1. Defining the Corporate Mission

 Organization develop mission statements to share them with their managers, employees, and (in many cases)
customers.
 A well-worked-out mission statement provides company employees with a shared sense of purpose, direction, and
opportunity.

Question: “Differentiate Vision and Mission?”

 Each company mission is shaped by five elements:

1. History
2. Current preferences of the owners and management
3. The market environment

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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 4. Resources
5. Distinctive competencies

 Major Characteristics of a Good Mission Statement:

1. They focus on a limited number of goals.
2. Mission statements stress the major policies and values that the company wants to honor.
3. They define the major competitive scopes within which the company will operate.
 Industry scope
 Product and application scope
 Competence scope
 Market-segment scope
 Vertical scope
 Geographical scope

2. Establishing Strategic Business Units

Question: “How do you define an SBU?”

 Three Characteristics of an SBU:

1. It is a single business or collection of related businesses that can be planned separately from rest of the
company.
2. It has its own set of competitors.
3. It has a manager who is responsible for strategic planning and profit performance and who controls most of
the factors affecting profit.

 Most companies operate several businesses. However, companies too often define their business in terms of
products.

 Levitt argued that market definitions of a business are superior to product definitions.

 A business must be viewed as a customer-satisfying process, not a goods-producing process.

 Products are transient, but basic needs and customer groups endure forever.

 Management should avoid a market definition that is too narrow or too broad
 Companies must avoid defining their business in terms what their products accomplish, instead of simply what they
are.

 A business can be defined in terms of three dimensions:

1. Customer group
2. Customer needs
3. Technology

3. Assigning Resources to Each SBU

 The purpose of identifying the company’s strategic business units is to develop separate strategies and assign
appropriate funding.

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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 SBU Portfolio Evaluation Tools:

1. Boston Consulting Group Model (or Growth-Share Matrix)

 2 Dimensions:
1. Market growth rate (vertical axis) – indicates the annual growth rate of the market in which the
business operates.
2. Relative market share (horizontal axis) – refers to the SBU’s market share relative to that of its
largest competitor in the segment.

 Four Divisions:
1. Question marks
 Businesses that operate in high-growth markets but have low relative market share.
 A company tries to enter a high-growth market in which there is already a market leader.
 Requires a lot of cash because the company has to spend money on plants, equipment, and
personnel to keep up with the fast-growing market, and because it wants to overtake the
leader.
2. Stars
 It is the market leader in a high-growth market.
 It doesn’t necessarily produce a positive cash flow for the company.
 The company must spend substantial funds to keep up with the high market growth and fight
off competitor’s attacks.
3. Cash cows
 When the market’s annual growth rate falls to less than 10%, the star becomes a cash cow if it
still has the largest relative market share.
 It produces a lot of cash for the company.
 The company doesn’t have to finance a lot of capacity expansion because the market’s growth
rate has slowed down.
 It enjoys economies of scale and higher profit margin.
 The company uses its cash-cow businesses to pay its bills and support its other businesses.
4. Dogs
 These are the businesses that have weak market shares in low-growth markets.
 They typically generate low profits or losses, although they may generate some cash.
 It often consumes more management time than they are worth and need to be phased down or
out.

 After the company had evaluated the status of each of their SBU, the next task is to determine the
objective, strategy, and budget to assign to each.
1. Build
 Objective is to increase the SBU’s market share, even forgoing short-term earnings to achieve
this objective if necessary.
 Building is appropriate for question marks whose market shares must grow if they are to
become star.
2. Hold
 Objective is to preserve the SBU’s market share.
 This strategy is appropriate for strong cash cows if they are to continue yielding a large positive
cash flow.
3. Harvest
 Objective is to increase the SBU’s short-term cash flow regardless of long-term effect.

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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 
Harvesting involves a decision to eventually withdraw from a business by implementing a
program of continuous cost retrenchment.
 The hope is to reduce costs at a faster rate than any potential drop in sales, thus resulting in an
increase in the company’s positive cash flow.
 This strategy is appropriate for weak cash cows whose future is dim and from which more cash
flow is needed.
 Harvesting can be used with question marks and dogs.
 The company carrying out a harvesting strategy faces prickly social and ethical questions over
how much information to share with various stakeholders.
4. Divest
 Objective is to sell or liquidate the business because resources can be better used elsewhere.
 This strategy is appropriate for dogs and question marks that are acting as a drag on the
company’s profits.

20% Stars Question

Market Growth Marks

Cash Cows Dogs

0%
10x 0.1x
Relative Market Share

2. The General Electric Model

 2 Dimensions: (1) Market attractiveness (vertical axis) and (2) Business strength (horizontal axis)
 To measure these two dimensions, strategic planners must identify the factors underlying each
dimension and find a way to measure them and combine them into an index.
Business Strength
Strong Medium Weak

PROTECT POSITION INVEST TO BUILD BUILD SELECTIVELY

 Invest to grow at
maximum digestible
rate
High  Concentrate effort on
maintaining strength
 Challenge for  Specialize around
leadership limited strengths
 Build selectively on  Seek ways to overcome
strengths weaknesses
 Reinforce vulnerable  Withdraw if indications
areas of sustainable growth
are lacking

BUILD SELECTIVELY SELECTIVELY/MANAGE LIMITED EXPANSION

Market  Invest heavily in most FOR EARNINGS OR HARVEST
Attractiveness attractive segments  Protect existing  Look for ways to
 Build up ability to program expand without high
Medium counter competition  Concentrate risks; otherwise,
 Emphasize profitability investments in minimize investment
by raising productivity segments where and rationalize
profitability is good & operations
risks are relatively low

PROTECT AND MANAGE FOR DIVEST

REFOCUS EARNINGS  Sell at time that will
 Manage for current  Protect position in most maximize cash value
Low earnings th profitable segments  Cut fixed costs and
Culled from Kotler, Philip; Marketing Management, 14 on
 Concentrate ed.; Prepared by
 Mr. Angelo
Upgrade A. Abejero
product line for classavoid
roominvestment
lecture purposes only.
attractive segments  Minimize investment meanwhile
 Defend strengths AAA’17-‘18
4. Planning New Businesses
 The company’s plans for its existing businesses allow it to project total sales and profits.
 Often, projected sales and profit are less than what corporate management wants them to be.
 If there is a strategic-planning gap between future desired sales and projected sales, corporate management will
have to develop or acquire new businesses to fit it.

Desired
Sales Diversification

Integrative growth Strategic-planning

gap
Intensive growth
Sales

Current
Portfolio

0 Time (years) 5

 Growth Opportunities
1. Intensive Growth Opportunities – identify opportunities to achieve further growth within the company’s
current businesses

 Product/Market Expansion Grid

Current New
Products Products

Market- Product-
Penetration Development
Current Strategy Strategy
Market

Market- Diversification
Development Strategy
New Strategy
Market

2. Integrative Growth Opportunities – identify opportunities to build or acquire businesses that are related to the
company’s current businesses

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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  Types
1. Backward Integration – suppliers
2. Forward Integration – distribution channels
3. Horizontal Integration – competitors
3. Diversification Growth Opportunities – identify opportunities to add attractive businesses that are unrelated
to the company’s current businesses

 Types
1. Concentric Diversification Strategy
 The company seeks new products that have technological and/or marketing synergies
with existing products lines, even though the new product themselves may appeal to a
different group of customers.
2. Horizontal Diversification Strategy
 The company might search for new products that could appeal to its current customers
even though the new products are technology unrelated to its current product line.
3. Conglomerate Diversification Strategy
 The company might seek new businesses that have no relationship to the company’s
current technology, products, or markets.

(5. Downsizing Older Businesses)

 To pursue growth, companies must not only develop new businesses but also carefully divest tired old businesses in
order to release needed resources and reduce costs.
 Weak businesses require a disproportionate amount of managerial attention.
 Types
1. Pruning
2. Harvesting
3. Divesting

Business Unit Strategic Planning

External
Environment
(opportunity
& threat)
analysis Feed
Business Goal Strategy Program Implementa- back
Mission TOWS Analysis Formulation Formulation Formulation tion &
contr
ol
Internal
Environment
(strength&
weakness)
analysis

1. Business Mission
 Each business unit needs to define its specific mission within the broader company mission.

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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2. External Environment Analysis (Opportunity and Threat Analysis)
 Once the business unit has formulated its mission statement, the business manager knows the parts of the
environment it needs to monitor to achieve its goals.

 In general, a business unit has to monitor key

1. external macroenvironment forces (using STEP analysis)
2. significant microenvironment actors (customer, competitors, distribution channels, suppliers)
3. marketing intelligence

 Marketing Opportunity is area of buyer need in which a company can perform profitability

 Environmental Threat is a challenge posed by an unfavorable trend or development that would lead, in
absence of defensive marketing action, deterioration in sales and profit.

 Classification of Business according to Attractiveness

1. Ideal Business – high in major opportunities and low in major threats
2. Speculative Business – high in both major opportunities and threats
3. Mature Business – low in major opportunities and low in threats
4. Troubled Business – low in opportunities and high in threats

3. Internal Environment Analysis (Strengths/Weaknesses Analysis)

 It is one thing to discern attractive opportunities in the environment; it is another to have the competencies needed
to succeed in these opportunities. Thus each business needs to evaluate its internal strengths and weaknesses
periodically.
 Clearly, the business does not have to correct all its weaknesses, nor should it gloat about all its strengths.
 The big question is whether the business should limit itself to those opportunities where its possesses the
required strengths or should consider better opportunities where it might have to acquire or develop certain
strengths

4. Goal Formulation
 Once the company has performed its TOWS analysis, it can proceed to develop specific goals for the planning
period.
 Managers use the term goals to describe objectives that are specific with respect to magnitude and time.
 Turning objectives into measurable goals facilitates management planning, implementation, and control
 The business unit sets the objectives and then manages by objectives (MBO)
 Criteria for MBO to work:
1. Objectives must be arranged hierarchically, from the most to the least important. (Use Pareto Principle or
the 80/20 principle).
2. Objectives should be stated quantitatively whenever possible.
3. Goals should be realistic. They should arise from an analysis of the business unit’s opportunities and
strengths, not from wishful thinking.
4. The company’s objectives must be consistent. It is not possible to maximize both sales and profits
simultaneously.

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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5. Strategy Formulation
 Goals indicate what a business unit wants to achieve; strategy is a game plan for how to get there.

 Michael Porter’s 3 Generic Type of Business Strategies

1. Overall cost leadership – business works to achieve the lowest production and distribution costs so that it can
price lower than its competitors and win a large market share.
2. Differentiation – business concentrates on achieving superior performance in an important customer benefit
area valued by a large part of the market.
3. Focus – business focuses on one or more narrow market segments rather than going after a larger market. The
firm gets to know these segments’ needs and pursues either cost leadership or a form of differentiation.

 Operational Effectiveness and Strategy

 According to Porter, Firms pursuing the same strategy directed to the same target market constitute a
strategic group.
 The firm that carries out that strategy best will make the most profit.
 Many companies believe they can win by performing the same activities more effectively than their
competitors; but competitors can quickly copy the operationally effective company using benchmarking
and other tools, thus diminishing the advantage of operational effectiveness.
 Porter defines strategy as “the criterion of a unique and valuable position involving a different set of
activities.”
 A company can claim that it has a strategy when it “performs different activities from rivals or performs
similar activities in different ways.”

 Major Categories of Marketing Alliances

1. Product and/or service alliances – one company licenses another to produce its product, or two companies
jointly market their complementary products or a new product.
2. Promotional alliances – one company agrees to carry a promotion for another company’s product or service
3. Logistics alliances – one company offers logistical support services for another company’s product.
4. Pricing collaborations – one or more companies join in a special pricing collaboration.

6. Program Formulation
 Once the business unit has developed its principal strategies, it must work out detailed support programs.
 Once the programs are tentatively formulated, the marketing people must evaluate the program costs

7. Implementation
 A clear strategy and a well-thought-out supporting program may be useless if the firm fails to implement them
carefully.
 Indeed, strategy is only one f the seven elements that the best-managed companies exhibit.

 McKinsey 7-S Framework

 The first three elements – strategy, structure, and systems – are considered the “hardware” of success.
 The next four – style, staff, skills, and shared values – are the “software.”

8. Feedback and Control

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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 As it implements its strategy, the firm needs to track the result and monitor new developments in the internal and
external environment

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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The Marketing Process
 Planning at the corporate, division, and business levels is an integral part of the marketing process.
 The task of any business is to deliver value to the market at a profit.

 Marketing Process consists of analyzing marketing opportunities, developing marketing strategies,

planning marketing programs, and managing the marketing effort.

 The Value Creation and Delivery Sequence: A Marketing Perspective

Choose the Value Provide Value Communicate the Value

Market Value Product Service Sourcing Distributing

Customer selection/ positioning Develop- Develop- Pricing Sales Sales Advertising
Satisfaction focus ment ment Force Promotion
Making Servicing

Strategic Marketing Tactical Marketing

 The 4 Ps of Strategic Marketing

1. Probing (Marketing Information System, Environmental and Competitors’ Analysis)
2. Partitioning (Market Segmentation)
3. Prioritizing (Market Targeting)
4. Positioning (Value Proposition)

 The 7Ps (former 4Ps) of Marketing Mix is the set of marketing tools that the firm uses to pursue its marketing
objectives in the target market.
1. Product
2. Price
3. Place
4. Promotion
5. People (service)
6. Physical evidence/structure (service)
7. Process (service)

1. Analyzing Marketing Opportunities

 The first task facing marketing managers is to analyze the long rub opportunities in the market in improving
companies’ performance.
 To evaluate opportunities, marketing managers need to operate a reliable marketing information system (MIS).
 Marketing research is an indispensable marketing tool, because companies can serve their customers well only by
researching their needs and wants, their locations, their buying practices, and so on.
 The purpose of market research is to gather significant information about the marketing environment.
 Marketing managers must also identify opportunities from different types of market (consumer and
business/industrial markets)
 They also must be alert and aware of competitors’ moves and plans.
 Once the company has analyzed its market opportunities, it is ready to select target markets.

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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 Modern marketing practice calls for dividing the market into major market segments, evaluating each segment,
and selecting and targeting those market segments that the company can best serve.

2. Developing Marketing Strategies

 The company needs to develop a differentiating and positioning strategy (key elements: offer and target market)
for the target market.
 After product positioning, the company must initiate new-product development, testing, and launching
 Different decision tools and controls are needed at different stages of the new-product development process.
 After the launch the product’s strategy will have to be modified at the different stages in the product life cycle:
introduction, growth, maturity, and decline.
 Furthermore, strategy choice will depend on whether the firm plays the role of market leader, challenger, follower,
or nicher
 Finally, strategy will have to take into account changing global opportunities and challenges.

 Strategy: A Balanced Scorecard Approach

 Robert Kaplan and David Norton (1992)
 This involves taking both financial and non-financial measures and examining the benefits delivered to all the
organization’s stakeholders.
 Four sets of measures:
1. Finance – How should we look to our shareholders?
2. Customers – How should we look to our customers?
3. Internal activities – At which business processes must we excel?
4. Innovation and learning – How will we sustain our ability to change and improve?

 Common Types of Strategy used as Marketing Jargons

 Corporate Strategy: long-term moves made to achieve corporate plans and objectives. Corporate
strategy involves senior management decisions, eg choosing what business to be in.

 Operational Strategy: can cover manufacturing systems, eg McDonald’s strategy was to systematize the
franchising system so that it could deliver a consistent level quality, service, cleanliness, and value around
the world.

 Marketing Strategy: involves the whole marketing mix and choice of target markets, exploring
competitive advantage, eg reposition the product as up-market, state of the art, priced accordingly and
distributed through exclusive retail stores, and supported by a major above-the-line campaign.

 Product Strategy: determines and guides decisions about product development, eg to expand the range
instead of restrict the range, focus on product enhancements only, utilize miniaturization, etc.

 Pricing Strategy: determines process and pricing structures, eg adopt a premium strategy (skimming the
market) instead of a cut-price strategy (penetrating the market)

 Distribution Strategy: determines the routes for distribution, eg to distribute directly through mail order
instead of retail outlets or to develop multilevel channels instead of single-level channels.

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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  Marketing communications strategy: determines the message or sequence of message which should be
shared with specific target audiences through the optimum communications mix (eg advertising or direct
mail).

 Advertising Strategy: determines the message or sequence of messages which should be shared with
specific target audiences through the optimum media mix (eg television or press advertisements). Note
that, ideally, the communications strategy should drive this.

3. Planning Marketing Programs

 To transform marketing strategy into marketing programs, marketing managers must take basic decisions on
marketing expenditures, marketing mix, and marketing allocation.
 First, the company must decide what level of marketing expenditures is necessary to achieve its marketing
objectives. (marketing expenditures)
 Companies typically establish their marketing budget at a percentage of the sales goals.
 Second, the company also has to decide how to divide the total marketing budget among the various tools in the
marketing mix. (marketing mix))
 Finally, marketers must decide on the allocation of the marketing budget to the various products, channels,
promotion media, and sales areas. (marketing allocation)

4. Managing the Marketing Effort

 The final step in the marketing process is organizing the marketing resources and then implementing and
controlling the marketing plan.
 The company must build a marketing organization that is capable of implementing the marketing plan
 There are likely to be surprises and disappointments as marketing plans are implemented. For this reason, the
company needs feedback and control. There are three types of marketing control:
1. Annual-plan control
2. Profitability control
3. Strategic control

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

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The Nature and Contents of a Marketing Plan
 Also called “business plan” or “battle plan”.

I. Executive Summary and Table of Contents Presents a brief overview of the

proposed plan
II. Current Market Situation Presents relevant background data on
 The Company the market, product, competition,
distribution, and macroenvironment
o Nature of Business
o Background
o Vision and Mission
o Organization
o Corporate Value Chain Analysis
o Identification and Evaluation of Core Competence
 Macroenvironment (identify only relevant developments)
 Microenvironment
o Industry Analysis (use Porter’s 5-Forces Model)
o Key Industry Success Factors
o Major Players
o Competitor Analysis
o Possible Strategic Moves of Competitors
III. Opportunity and Issue Analysis Identifies the main
 Threats opportunities/threats,
strengths/weaknesses, and issues facing
 Opportunities the product line
 Weaknesses
 Strengths
 TOWS Matrix
IV. Objectives (3 years) Defines the plan’s financial and
 Strategic Marketing Objectives marketing goals in terms of sales
volume, market share, and profit
 Financial Objectives
V. Marketing Strategies (3 years) Presents the broad marketing approach
 Present Strategies being Implemented that will be used to achieve the plan’s
objectives
o Target Market
o Marketing Strategies
Identify at least 3 ACAs and assess each
 Alternative Courses of Action of the ACA via identified strategic
 Strategy Evaluation Matrix criteria.
 Recommended Strategy
o Target Market
o Marketing Strategies
VI. Action programs Presents the special marketing
 Develop annual and/or periodic programs within the 3-year period adopted from the programs designed to achieve the
proposed Marketing strategies business objectives

VII. Projected profit-and-loss statement (3-year Projection) Forecasts the plan’s expected financial
outcomes
VIII. Implementation Controls Indicates how the plan will be monitored

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

AAA’17-‘18
 Guide in Developing Your Marketing Plan

Crafting a marketing plan is hard but satisfying work. When completed, a marketing plan serves as a roadmap that
details the context and scope of marketing activities including, but not limited to. A mission statement, goals and
objectives, a situation, analysis, growth opportunities, target market(s) and marketing (mix) program, a budget, and an
implementation schedule.

As a written document, the plan conveys in words the analysis, ideas, and aspirations of its author pertaining to a
business, product, and/or brand marketing effort. How a marketing plan is written communicates not only the
substance of the marketing effort but also the professionalism of the author. Writing style will not overcome
limitations in substance. However, a poorly written marketing plan can detract from the perceived substance of the
plan.

Writing and Style Considerations

Given the importance of a carefully crafted marketing plan, authors of marketing plans adhere to certain guidelines.
The following writing and style guidelines generally apply:

 Use a direct, professional writing style. Use appropriate business and marketing terms without jargon. Present and
future tenses with active voice are generally better than past tense and passive voice.

 Be positive and specific. At the same time, avoid superlatives (“terrific”, “wonderful”). Specifics are better than
glittering generalities. Use numbers for impact, justifying computations and projections with facts or reasonable
quantitative assumptions where possible.

 Use bullet points for succinctness and emphasis. As with the list you are reading, bullets enable key points to be
highlighted effectively and with great efficiency.

 Use “A-level” (the first level) and “B-level” (the second level) headings under major section headings to help readers
make easy transitions from one topic to another. This is also forces the writer to organize the plan more carefully.
Use these headings liberally, at least once every 200 to 300 words.

 Use visuals where appropriate. Illustrations, graphs, and charts enable large amounts of information to be
presented succinctly.

 Shoot for a plan 15 to 35 pages in length, not including financial projections and appendices. An uncomplicated
small business may require only 15 pages, while a new business startup may require more than 35 pages.

 Use care in layout, design, and presentation. Laser or ink-jet printers give a more professional look than do dot
matrix printers or typewriters. A bound report with a cover and clear title page adds professionalism.

Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

AAA’17-‘18
Culled from Kotler, Philip; Marketing Management, 14th ed.; Prepared by Mr. Angelo A. Abejero for class room lecture purposes only.

AAA’17-‘18