Chapter 1

Introduction: The Marketing Plan

Disclaimers: All logos, photos, etc. used in this presentation are the property of their respective copyright owners and are used here for educational purposes only. Some material adapted from: Lehmann & Winer, Analysis for Marketing Planning, 7th ed Some material adapted from: Kotler & Keller, Marketing Management, 13th ed See book: Sorger, Marketing Planning for full bibliography

Marketing Planning Stephan Sorger 2010: www.stephansorger.com; Ch. 1 Introduction 1.1

Strategic Marketing Planning Chapter 1: Introduction: The Marketing Plan

Table of Contents Introduction Advantages & Issues Process Outline Example Written Plan Example Presentation Definition of a strategic marketing plan Key benefits and problems during planning Steps to complete a plan Structure to Use for Course Project Plan Sample Marketing Plan Written Report Sample Marketing Plan PowerPoint

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Definition: Strategic Marketing Plan

Written Plan - Forces discipline - Aids collaboration

A Strategic Marketing Plan is a written plan that covers the Situation, Objectives, and Actions for an Organization for the plan Time Period

Time Period - Annual - Quarterly - Depends on market

Organization defined broadly - Entire company (rare) - SBU: Strategic Business Unit - Product/ Service

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Written Plan
Cross-Functional Input & Usage Marketing Finance

Professional Services

Strategic Marketing Plan

Engineering

Manufacturing Other

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Time Period
Time period varies with rate of change of industry

Quarterly: High Technology firms; fast-moving As Needed: New Product/ Service launch 1 Year: CPG (Consumer Packaged Goods) B2B (Business to Business) Mature markets; Slow to change 3-5 Years: Automotive, Industrial machinery

Timeline
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Organization
Flow-down of Marketing Strategy
CEO COO Division 1 COO Division 2 GM SBU 1 VP Engineering GM SBU 2 VP Marketing Chief Executive Officer Corporate Strategic Planning Caterpillar: Purchase Komatsu? Chief Operating Officer Division/ Group Planning Caterpillar: Earth-Moving Equipment General Manager Strategic Business Unit Caterpillar: Tracked Loaders VP Marketing Annual Marketing Plan Product Manager Product Plan: D300

Product Manager 1 Product Manager 2

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Advantages of Good Marketing Planning

Sound Marketing Planning Has Many Benefits Description Forces disciplined approach to market Identifies potential new competitors Can act as Early Warning radar Identifies specific responsibilities Avoids myopic approach to market Provides new information on customers Establishes specific objectives & targets Lays out specific programs Identifies other departments involvement Quantifies success/failure metrics Can monitor programs throughout year Advantage Discipline Opportunities Radar Responsibilities Myopia Customers Objectives Programs Cross-Functional Metrics Monitor

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Issues in the Planning Process

Issues to Watch Out for during the Planning Process Issue Description Speed Too slow: Seems like all we do is plan Too fast: Could miss critical insights Frequency Too often: Could result in constant strategy changes Too rare: Miss important changes in market Amount Too much data collection: Diminishing returns Too little data collection: Rely on hunches and guesswork Who Strategic Planning GroupNo buy-in Recommendation: Line managers develop with help of staff Other Groups Wrong way: View planning process as marketing domain Recommendation: Involve other groups Structure Too much: Bureaucratic paralysis Too little: No thorough analysis Recommendation: Rigid schedule, but flexible format Length Too long: Will never get read Too short: Not enough detail to be practical Recommendation: Typically 20-30 pages
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Planning Process: Top-Down vs. Bottom-Up

Both Approaches are Common; Both Have their Strengths & Weaknesses Organization Hierarchy CEO COO GM VP Sales Salesperson VP Marketing Product Manager Bottom-Up
TopDown BottomUp

Approach Top-Down

Description Plan done at top Pushed down to lower levels Example: Military, MBOs Good: Executive buy-in Bad: Little market data Plan starts with lower levels Salesperson gives forecast Marketer gives customer data Good: Market information Bad: Long time duration

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Planning Process: Approach

How to Develop a Marketing Plan

Collect Data

Conduct Industry Analysis

Conduct Customer/ Segment Analysis

Create Objectives, Strategies, Programs

Develop Financials & Controls

Get Buy-In & Launch the Plan

Market Feedback

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Marketing Plan Outline: Top Level

How a Good Marketing Plan is Organized
What is this plan about?

I. Executive Summary II. Situation Analysis III. Customer Analysis

How attractive is this market? What do we know about the customer? What are the goals & forecast of the firm? What is the marketing approach?

IV. Objectives, Market Potential, and Forecasting V. Marketing Strategy

What are the numbers behind the plan?

VI. Finance & Control

What is the assessment of the plan?

VII. Conclusions and Recommendations

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Marketing Plan Outline: The Modular Pre-Fab Approach

The Pre-Fab Approach Makes the Process Easier & Re-usable Typical Way: The Planning Period once per year Ugh! Lets get this thing over with
One drawn out linear plan with no structure. Weeks and weeks of work. No time to do it.

The New Modular Pre-Fab Way Build sections you need anyway for other marketing tasks Assemble sections and tie together with Executive Summary Executive Summary 5-Force PEST SWOT STP SMART NAICS 4-Ps Financials

Conclusions & Recommendations

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Marketing Plan Outline: Executive Summary

I. Executive Summary A. Objectives Strategic objectives Financial objectives Tactical objectives Budget requirements Projected revenue Break-even Owner of project Personnel involved Plan duration

B. Financials

C. Logistics

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Marketing Plan Outline: Situation Analysis: 1 of 2

II. Situation Analysis: 1 of 2 A. Market Description Market definition Market characteristics Industry attractiveness Current size Predicted growth Political and legal environment Economic environment Social and cultural environment Technological environment

B. Market Size C. PEST Analysis

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Marketing Plan Outline: Situation Analysis: 2 of 2

II. Situation Analysis: 2 of 2 D. Company Analysis Identity/ Focus/ Culture Value Proposition Go to Market Approach SWOT Analysis Market Share Competition Identification Competition Comparison Table Predicted Future Strategies. Perceptual Map

E. Competitor Analysis

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Marketing Plan Outline: Customer Analysis: 1 of 2

III. Customer Analysis: 1 of 2: Consumer & Business Markets A. Customer Characteristics Who: Who are they? What: What do they buy? Where: Where do they buy it? When: When do they buy it? Why: Why do they prefer this item? How: How do they decide?

B. Consumer Influences C. Consumer Decision Process

Consumer: Influences in decision Business: Buying Roles Consumer: Decision Process Business: Purchase Policies

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Marketing Plan Outline: Customer Analysis: 2 of 2

III. Customer Analysis: 2 of 2: STP D. Segmentation E. Targeting F. Positioning Identify groups of customers Decide which groups to focus on Define yourself in minds of customers POD (Points of Difference) POP (Points of Parity)
Ice Cream Market
High Calorie

Budget

Luxury

Low Calorie

Segmentation

Targeting

Positioning

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Marketing Plan Outline: Objectives, Potential, Forecasting

IV. Objectives, Market Potential, and Forecasting A. Objectives Corporate Objectives Marketing Objectives Other Objectives: Brand, etc. TAM (Total Available Market) Served Market Predicted Future Sales

B. Market Potential C. Forecasting

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Marketing Plan Outline: Marketing Strategy: 1 of 2

V. Marketing Strategy: 1 of 2 A. General Strategic Approach B. Product New Products/ Markets Differentiation Product Mix Brand Price Objectives Perceived Value Setting Price
Example of Product: Nintendo Wii

C. Price

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Marketing Plan Outline: Marketing Strategy: 2 of 2

V. Marketing Strategy: 2 of 2 D. Place (Distribution) Channel Selection Channel Conflict Partners Marketing Communications Mix Media Mix Internet Marketing Events Public Relations Sales Promotions: Consumer, Trade
Example of Distribution Channel: Selling Wii console at Wal-Mart

E. Promotion

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Marketing Plan Outline: Finance & Control

VI. Finance & Control A. Finance Break-Even Pro-Forma (Projected) Profit/ Loss Pro-Forma (Projected) Balance Sheet Marketing Budget Monitoring Plan Contingency Plans

B. Control

Contingency plans are important for when things go wrong

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Marketing Plan Outline: Recommendations

VII. Recommendations Recommendations Top 3 Recommendations Other Recommendations Timetable/ Sense of Urgency

Good recommendations help companies decide which way to go

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Course Preparations
Prepare for Session 6: Objectives, Market Potential, Forecasting Laptop Exercise Excel Excel 2003 Excel 2007 Screenshots Bring your laptop PC to class In-class exercise on building a sales forecast Will need Excel Data Analysis ToolPak (might need to add) Might need original Excel 2003 installation CD (or ask IT) Download DataAnalysis ToolPak (free) http://office.microsoft.com/en-us/excel/HP100215691033.aspx Shots are for Excel 2003 install; Excel 2007 similar

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Group Guidelines: Size, Selection, Suggestions

Size: 3-7 members 3
Minimum

5
Good

7
Maximum

Selection: Select group members to fall within certain geographical area

North Bay SF Peninsula South Bay East Bay

Suggestions: Select Roles

Point/ Strategy Communications Market Expert Research Analysis

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