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Company and Marketing Strategy

Company and Marketing Strategy. Chapter: 2. Companywide Strategic Planning. Strategic Planning The process of developing and maintaining a strategic fit between organization’s goal and capabilities and its changing marketing opportunities Sets stage for the rest of company’s planning

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Company and Marketing Strategy

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Presentation Transcript

  1. Company and Marketing Strategy Chapter: 2

  2. Companywide Strategic Planning • Strategic Planning The process of developing and maintaining a strategic fit between organization’s goal and capabilities and its changing marketing opportunities • Sets stage for the rest of company’s planning 1) Annual Plans 2) Strategic Plans

  3. Steps in Strategic Planning Business unit, product, and market level Corporate Level Planning marketing and other functional strategies Defining the company’s mission Setting company objectives and goals Designing the business portfolio

  4. Defining a Market-Oriented Mission • Mission Statement A statement of the organization’s purpose- what it wants to accomplish in the larger environment - acts as an invisible hand - Market oriented mission statement - Meaningful, specific, yet motivating - Mission should not state profits

  5. Market Oriented Business Definitions

  6. Setting Company Objectives and Goals • Turn mission into objectives • How will you go about things

  7. Designing the business portfolio • Business Portfolio The collection of businesses and products that make up the company - Should be a best fit to company’s strengths and weaknesses to opportunities Step: 1- Analyzing the current business portfolio Step: 2- Future Portfolio

  8. Analyzing the Current Business Portfolio • The process by which management evaluates the products and businesses that make up the company - identify the SBU’s • Growth Share Matrix A Portfolio- planning method that evaluates a company's strategic business units in terms of its market growth rate and relative market share. SBUs are classified as stars, cash cows, question marks, or dogs

  9. BCG Growth Share Matrix Star Question Mark High Market growth rate Cash Cow Dog Low High Low Relative market Share

  10. BCG Growth Share Matrix Contd. • Stars: - High growth, High share - Heavy Investment required to sustain share - Will eventually turn in cash cows • Cash Cows - Low Growth, High Share - Less investment - a lot of cash produced

  11. BCG Growth Share Matrix Contd. • Question Marks - Low share, High Growth - A lot of investment to hold share - Which too keep and which to let go • Dogs - Low Growth, Low share - no large sources of cash

  12. Problems with Matrix • Difficult, time consuming and costly • No advice on future

  13. Developing strategies for growth and downsizing • Identify, evaluate and select market opportunities and lay down strategies for capturing them • Product/market expansion grid A portfolio- planning tool for identifying company growth opportunities through market penetration, market development, product development, or diversification

  14. The Product/Market Expansion Grid Existing Products New Products Existing Markets Market Penetration Product Development Market Development Diversification New Markets

  15. The Product/Market Expansion Grid • Market Penetration A Strategy for company growth by increasing sales of current products to current market segments without changing the product • Market Development A Strategy for company growth by identifying and developing new market segments for current company products

  16. The Product/Market Expansion Grid • Product Development A strategy for company growth by offering modified or new products to current market segments • Diversification A strategy for company growth through starting up or acquiring business outside the company's current products and markets

  17. Downsizing Reducing the business portfolio by eliminating products of business units that are not profitable or that no longer fit the company's overall strategy

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