1. Chapter 2- slide 1
Chapter Two
Company and Marketing Strategy:
Partnering to Build Customer
Relationships

2. Chapter 2- slide 2Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Strategic planning is the process of developing
and maintaining a strategic fit between the
organization’s goals and capabilities and its
changing marketing opportunities.
Strategic planning is a process of decisions made
by an organization to set goals and to outline a
course of action to achieve those goals, to grow
the business and to help the business be
profitable.
Strategic Planning

3. Chapter 2- slide 3Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Steps in Strategic Planning

4. Chapter 2- slide 4Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
The mission statement is the organization’s purpose,
what it wants to accomplish in the larger
environment
Market-oriented mission statement defines the
business in terms of satisfying basic customer needs
1. Defining a Market-Oriented Mission

5. Chapter 2- slide 5Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Business
objectives
• Build profitable
customer
relationships
• Invest in
research
• Improve profits
Marketing
objectives
• Increase
market share
• Create local
partnerships
• Increase
promotion
2. Setting Company Objectives and Goals

6. Chapter 2- slide 6Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
The business portfolio is the collection of
businesses and products that make up the
company.
Portfolio analysis is a major activity in
strategic planning whereby management
evaluates the products and businesses that
make up the company.
3. Designing the Business Portfolio

7. Chapter 2- slide 7Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Strategic business unit (SBU) is a unit of the
company that has a separate mission and
objectives that can be planned separately
from other company businesses
• Company division
• Product line within a division
• Single product or brand
Analyzing the Current Business Portfolio

8. Chapter 2- slide 8Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Identify key businesses (strategic
business units, or SBUs) that make
up the company
Assess the attractiveness of its
various SBUs
Decide how much support each
SBU deserves
Analyzing the Current Business Portfolio

9. Chapter 2- slide 9Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Boston consulting group approach

10. Chapter 2- slide 10Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Analyzing the Current Business Portfolio
The Boston Group Approach
Stars are high-growth, high-share businesses or products
requiring heavy investment to finance rapid growth. They
will eventually turn into cash cows.
Cash cows are low-growth, high-share businesses or products
that are established and successful SBUs requiring less
investment to maintain market share.
Question marks are low-share business units in high-growth
markets requiring a lot of cash to hold their share.
Dogs are low-growth, low-share businesses and products that
may generate enough cash to maintain themselves but do
not promise to be large sources of cash.

11. Chapter 2- slide 11Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Product/market expansion grid is a tool
for identifying company growth
opportunities through market
penetration, market development,
product development, or diversification
Developing Strategies for Growth and Downsizing

12. Chapter 2- slide 12Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Developing Strategies for Growth and Downsizing
Product/market expansion grid strategies

13. Chapter 2- slide 13Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Market penetration is a growth strategy
increasing sales to current market
segments without changing the
product
Market development is a growth
strategy that identifies and develops
new market segments for current
products
Developing Strategies
for Growth and Downsizing

14. Chapter 2- slide 14Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Product development is a growth strategy
that offers new or modified products to
existing market segments
Diversification is a growth strategy through
starting up or acquiring businesses outside
the company’s current products and
markets
Developing Strategies
for Growth and Downsizing

15. Chapter 2- slide 15Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Downsizing is the reduction of the
business portfolio by eliminating
products or business units that are not
profitable or that no longer fit the
company’s overall strategy
Developing Strategies
for Growth and Downsizing

16. Chapter 2- slide 16Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Marketing Strategy and the Marketing
Mix

17. Chapter 2- slide 17Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Market segmentation is the division of a
market into distinct groups of buyers who
have distinct needs, characteristics, or
behavior and who might require separate
products or marketing mixes
Market segment is a group of consumers who
respond in a similar way to a given set of
marketing efforts
Customer-Driven Marketing Strategy

18. Chapter 2- slide 18Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Market targeting is the process of evaluating
each market segment’s attractiveness and
selecting one or more segments to enter
Market positioning is the arranging for a
product to occupy a clear, distinctive, and
desirable place relative to competing
products in the minds of the target
consumer
Customer-Centered Marketing Strategy

19. Chapter 2- slide 19Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Marketing mix is the set of controllable
tactical marketing tools—product, price,
place, and promotion—that the firm blends
to produce the response it wants in the
target market
Developing an Integrated Marketing Mix

20. Chapter 2- slide 20Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Developing an Integrated Marketing Mix

21. Chapter 2- slide 21Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Managing the Marketing Effort
Managing the marketing effort requires:
Analysis, Planning, Implementing and Controlling

22. Chapter 2- slide 22Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Marketing Analysis
Marketing analysis is the complete analysis of the company’s
situation in a SWOT analysis that evaluates the company’s:
• Strengths
• Weaknesses
• Opportunities
• Threats

23. Chapter 2- slide 23Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Marketing Analysis – SWOT Analysis

24. Chapter 2- slide 24Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Marketing Analysis
• Strengths include internal capabilities, resources, and
positive situational factors that may help to serve company
customers and achieve company objectives.
• Weaknesses include internal limitations and negative
situational factors that may interfere with company
performance.
• Opportunities are favorable factors or trends in the external
environment that the company may be able to exploit to its
advantage.
• Threats are unfavorable factors or trends that
may present challenges to performance.

25. Chapter 2- slide 25Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Market planning
Planning is the development of strategic and
marketing plans to achieve company
objectives.
Marketing strategy consists of the specific
strategies for target markets, positioning, the
marketing mix, and marketing expenditure
levels.

26. Chapter 2- slide 26Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Market Planning—Parts of a Marketing Plan
Executive summary Marketing situation Threats and
opportunities
Objective and
issues
Marketing strategy Action programs
Budgets Controls

27. Chapter 2- slide 27Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
Implementing is the process that turns
marketing plans into marketing actions to
accomplish strategic marketing objectives
• Successful implementation depends on how
well the company blends its people,
organizational structure, decision and reward
system, and company culture into a cohesive
action plan that supports its strategies
Marketing Implementation

28. Chapter 2- slide 28Copyright © 2010 Pearson Education, Inc.
Publishing as Prentice Hall
• Controlling is the measurement and evaluation of
results and the taking of corrective action as
needed
• Operating control
• Strategic control
A marketing audit is a comprehensive, systematic,
independent, and periodic examination of a
company’s environment, objectives, strategies, and
activities to determine problem areas and
opportunities.
Marketing Control