CHAPTER 2 – STRATEGY PLANNING. Target Marketing vs. Mass Marketing TARGET MARKETING Marketing mix...

CHAPTER 2 – STRATEGY PLANNING

Target Marketing vs. Mass Marketing

TARGET MARKETINGMarketing mix is tailored to fit

specific target customer(s) MASS MARKETING

Vaguely aims at "everyone" with the same marketing mix

The Four Ps and Marketing Mix Planning

PRODUCTPROMOTIONPLACE (DISTRIBUTION)PRICE

© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin—for use only with Essentials of Marketing

Strategy Decision Areas Organized by the 4 Ps

© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin—for use only with Essentials of Marketing

Market Strategy = Target Market + Marketing Mix

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 offeredTo what target marketFor how longWhat resources (costs) are needed at what rateWhat results are expectedWhat control procedures will be used.

© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin—for use only with Essentials of Marketing

Elements of a Firm’s Marketing Program

© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin—for use only with Essentials of Marketing

The Marketing Plan

• Marketing plan: • Marketing Mix

Target Market

Time

Resources

Measurable Results

Control Procedures

Overview of Strategy – Planning Process

Marketing Strategy Planning Process

Narrowing down from broad market opportunities that a firm might pursue to a specific strategy Marketing strategy specifies a specific target

market and a specific marketing mix Not just “some” strategy, but one that will offer

target customers superior value

Segmentation helps pinpoint a specific target market

Marketing Strategy Planning Process cont’d Differentiation helps pinpoint a marketing mix that is

different from and better than what is available from a competitor

Screening criteria make it clear why you select a specific strategy (and why others are “screened out”)

S.W.O.T. analysis identifies and lists a firm’s strengths and weaknesses and its opportunities and threats S.W.O.T helps identify relevant screening criteria (what is

needed to get a competitive advantage)

Competitive Advantage

Superior Customer

Value

Total Company Effort to Satisfy

Customers

Customer SatisfactionCustomer

Retention

Profitable Relationships with

Customers

Customer Acquisition

Competitive Advantage

Requires that the firm:understand current competitors' offeringsanticipate competitors' likely plansmonitor effects of changes in competitionREALLY understand the target customers'

needs

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

Four Basic Types of Opportunities