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Basic Marketing, 13th edition

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Marketing Strategy Planning. For use only with ... Vaguely aims at 'everyone' with the same marketing mix ... Each plan is based on a marketing strategy ... – PowerPoint PPT presentation

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Title: Basic Marketing, 13th edition


1
Chapter 2 Marketing Strategy Planning
2
The Marketing Management Process
Exhibit 2-4
2-9
3
Target Marketing vs. Mass Marketing
  • TARGET MARKETING
  • Marketing mix is tailored to fit specific target
    customer(s)
  • MASS MARKETING
  • Vaguely aims at "everyone" with the same
    marketing mix

4
Marketing Strategy Planning
Exhibit 2-5
2-10
5
The Four Ps of the Marketing Mix
Exhibit 2-7
2-11
6
Strategy Decision Areas Organized by the Four Ps
Exhibit 2-8
2-12
7
The Marketing Plan
  • Marketing plan a written statement of a
    marketing strategy and the time related details
    for carrying out the strategy.
  • Spells out, in detail
  • What marketing mix is to be offered
  • To what target market
  • For how long
  • What resources (costs) are needed at what rate
  • What results are expected
  • What control procedures will be used.

8
Marketing Program
  • Marketing program blends all of the firm's
    marketing plans into one "big" planwhich is an
    integrated part of the whole-company strategic
    plan
  • Program requires an effective "building up"
    process
  • A good program must be based on good plans
  • Each plan must be carefully developed
  • Each plan is based on a marketing strategy
  • Each strategy is based on a marketing mix and a
    target market
  • Plans in overall program should work together to
    enhance a competitive advantage

9
Marketing Objectives
  • Should Be in Writing
  • Objectives must be clearly defined
    quantitatively measured
  • Measures should be taken at regular intervals
  • Measures must be useful to managers
  • Measures should be linked to rewards
  • Measures should directly relate to tactical and
    strategic goals of the firm

10
Profits, Revenues Costs
  • Marketing Concept meet the needs of the target
    market at a profit (C1, pg 16).
  • Profits Total Revenues Total Costs
  • What are Revenues?
  • What are Costs?

11
Revenues
  • Total Revenues price x quantity sold
  • Example Price 10 a unit. 50 Units sold
  • Total Revenues 50 x 10 500

12
Revenues
  • Most companies sell multiple products and
    revenues are summed across products sold
  • Example Company sells Product A Product B
  • Product A price 10 B 20
  • Units Sold A 50 B 100
  • What is the total revenue?

13
Total Revenue
  • (10 x 50) (20 x 100)
  • 2,500

14
Costs
  • Total Costs Fixed Costs Variable Costs
  • Fixed Costs Costs that do not change over some
    time period or level of production
  • Variable Costs costs that change when units
    produced or sold changes

15
Costs Example
  • Movie Theater monthly rent 4,000
  • Monthly Utilities 1,000
  • Labor Costs 3,000 if avg. number of people go
    to the movies
  • 2,000 if people going to the movies is 25
    below average
  • 5,000 if people going to the movies is 50
    greater than average
  • What are fixed costs? Variable Costs?

16
Movie Theater Costs
  • Fixed Costs 5,000
  • Variable Costs 2,000 3,000 or 5,000
    depending on attendance

17
Customer Equity Differentiation
  • Customer Equity is the expected earnings stream
    (profitability) of a firms current and
    prospective customers over some period of time
    (pg 43).
  • Differentiation means that the marketing mix is
    distinct from and better than what is available
    from a competitor (pg 50)

18
Only 3 Ways A Firm Increase Profits
  • 1 Sell more units at the same price (if selling
    above costs)
  • 2 Lower costs while maintaining price and
    quantity sold
  • 3 Meet target market needs better than
    competitors and successfully charge a higher price

19
Companies that are highly profitable
  • May have higher or lower costs per unit than
    competitors
  • May sell more or fewer units than competitors
  • May have a higher or lower price than competitors
  • We judge marketing success by profits NOT
    costs, units sold, price or total revenues ALONE

20
Competitive Advantage
  • Competitive advantage the firm has a marketing
    mix that the target market sees as better than a
    competitor's mix
  • A better marketing mix offers target customers
    better customer value
  • Note customers who are not in the target market
    may not see the marketing mix as offering better
    value
  • Requires that the firm
  • understand current competitors' offerings
  • anticipate competitors' likely plans
  • monitor effects of changes in competition
  • REALLY understand the target customers' needs

21
Marketing Strategy Planning Process
Exhibit 3-1
3-3
22
Types of Opportunities
Exhibit 3-2
3-4
23
Examples of Different Types of Opportunities
  • Market Penetration
  • Arm Hammer promotes new uses of its baking soda
  • Market Development
  • Marriott Hotels target families for weekend
    "get-aways" to rent rooms filled by business
    travelers during the week
  • Product Development
  • Microsoft develops a new version of its Windows
    operating system to appeal to the people who
    bought an earlier version but now want more
    features
  • Diversification
  • RJR, the cigarette producer, adds baked goods to
    its product line to appeal to new customers

24
Considering International Opportunities
Competitive Advantage
Smaller World
Better Trends?
Early Start
3-5
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