Strategic Planning and the

Marketing Process
1.0 Introduction
1.1. Origin of the report
This study and the term paper was conducted and submitted as a partial requirement for the
Principles of Marketing (MKT 502) course .The term paper was authorized by Mr. Syed Abul
Kalam Azad, course instructor of MKT 502, and Professor Department of Marketing, University
of Dhaka.

1.2 Objective
The objective of this term paper is to address a basic marketing concept which is the marketing
process. Another real challenge towards to make this study is to the task given by our honorable
course instructor that no specific topic was selected by him but we have to select a topic
ourselves from the chapter 2 named Strategic Planning and The marketing Process. So we have
selected Marketing Process as the topic of the term paper as once a strategic plan has defined a
company's overall mission and objectives, marketing process plays a key role in carrying out
these objectives.

1.3. Scopes and methodology

Throughout this work many things regarding Marketing process was learnt and this term paper
has been prepared on following bases.
Secondary study was conducted to identify the steps in Marketing process.
Consequently, this term paper is grounded in observation data obtained from recipients of
articles, statements and some research paper from different countries and different authors.

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1.4. Restrictions
To complete this term paper we found some limitations and restrains.
The main limitation of the study is the unavailability of all information
Another significant limitation was time constrain. It was difficult to analyze all the key
aspect about marketing process within a shorter period of time.

2.0 Strategic Planning & Steps

Strategic marketing planning includes two critical stages, corporate level and business unit level.
Corporate level planning is a task conducted by the top management. This stage consists of
defining the company mission, setting company objectives & goals and designing the business
portfolio. In a few succinct sentences companys mission statement captures, the essence of
businesss goals and the philosophies underlying them. Equally important, the mission statement
signals what organization is all about to the customers, employees, suppliers and community.
Then the objective and goals has to be determined. Company goals represent a clear statement of
intent. These goals are highly strategic objectives which incorporates every department of the
entire organization. Objectives are measurable targets which employees pursuit in support of the
business goal. Business unit level strategy includes plans or methods companies use to conduct
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various functions in their business operations. Larger companies often use more business
strategies since they often have several departments with different business functions. Small
businesses may adapt these strategies to their operations and assign them to different employees.
It is absolutely imperative that all steps of strategic planning must be coherent and realistic.

3.0 Companys Business and Mission

3.1 Definition
Very early in the strategy-making process, a companys senior managers must solve the issue of
what directional path the company should take. Can the companys prospects be improved by
changing its product offerings and/or the markets in which it participates and/or the customers it
caters to and/or the technologies it employs? Deciding to commit the company to one path versus
another pushes managers to draw some carefully reasoned conclusions about whether the
companys present strategic course offers attractive opportunities for growth and profitability or
whether changes of one kind or another in the companys strategy and long-term direction are
needed. Top managements views and conclusions about the companys long-term direction and
what product-customer-market-technology mix seems optimal for the road ahead constitute
companys business and mission for the company. A mission delineates managements
aspirations for the business, providing a panoramic view of where we are going and a
convincing rationale for why this makes good business sense for the company. A mission thus
points an organization in a particular direction, charts a strategic path for it to follow in preparing
for the future, and builds commitment to the future course of action. A clearly articulated
strategic vision communicates managements aspirations to stakeholders and helps steer the
energies of company personnel in a common direction. To function as a valuable managerial
tool, it must convey what management wants the business to look like and provide managers
with a reference point in making strategic decisions and preparing the company for the future. It
must say something definitive about how the companys leaders intend to position the company
beyond where it is today. In a few succinct sentences companys mission statement captures, the
essence of businesss goals and the philosophies underlying them. Equally important, the mission

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statement signals what organization is all about to the customers, employees, suppliers and
community. Then the objective and goals has to be determined

Characteristics of A Good
Mission Statement
Market Oriented
Realistic
Specific
Fit Market Environment

Distinctive Competencies
3.2 Product Orientation versus Market Orientation
The basic focus of a company with a production orientation is toward maximizing production
output. Under a production orientation, a company is succeeding when it is manufacturing as
many products as possible at the cheapest possible price. In contrast, a company with a
marketing orientation is squarely focused on the consumer. Market-oriented companies respond
to marketing research and tailor their products in accordance with what they perceive to be the
demands of the market. A business with a marketing orientation is essentially led by the needs of
its customers. Marketing research outcomes determine how much of a product is produced--old
products may be discontinued and new products invented based on the needs or desires of
consumers. In contrast, a production-oriented company does not pay close attention to the needs
of its customers and is focused primarily on making the maximum number of products. If
customers are dissatisfied with its product, a business with a production orientation is more
likely to look for a new set of customers than to alter its product. A production-oriented company
does not focus a great deal of energy on advertising. A business with a production orientation
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sees itself as fulfilling a need and assumes that as long as customers are aware of their product
and can afford, they will buy it. In contrast, market-oriented companies spend a great deal of
money on advertising. A market-oriented company carefully cultivates a brand in the minds of
potential customers in an attempt to influence them to buy its products instead of a competitor's
products.
Company

Product Oriented Definition

Market Oriented Definition

We provide the worlds best online

We help you organize the worlds information and

search engine.

make it universally accessible & useful.

We Run theme parks.

We create fantasies- a place where dreams come

true and America still works the way it suppose to.

We sell athletic shoes and apparel.

We bring inspiration and innovation to every

athlete in the world.

We make cosmetics.

We sell lifestyle and self-expression; success and

status; memories, hopes, and dreams.

We are an online video service.

We help people find and enjoy the worlds

premium video content when, where, and how they
want itall for free.

3.3 Setting Company Objectives and Goals

The managerial purpose of setting objectives is to convert the vision and mission into specific
performance targets. Well-stated objectives are specific, quantifiable or measurable, and contain
a deadline for achievement. As Bill Hewlett, cofounder of Hewlett-Packard, shrewdly observed,
You cannot manage what you cannot measure, and what gets measured gets done. Concrete,
measurable objectives are managerially valuable for three reasons: (1) They focus efforts and
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align actions throughout the organization, (2) they serve as yardsticks for tracking a companys
performance and progress, and (3) they provide motivation and inspire employees to greater
levels of effort. Ideally, managers should develop challenging yet achievable objectives that
stretch an organization to perform at its full potential. Two very distinct types of performance
targets are required, those relating to marketing performance and those relating to strategic
performance. Senior corporate executives normally have lead responsibility for devising
corporate strategy and for choosing among whatever recommended actions bubble up from the
organization below. Key business-unit heads may also be influential regarding issues related to
the businesses they head. Major strategic decisions are usually reviewed and approved by the
companys board of directors. Functional-area strategies concern the actions and approaches
employed in managing particular functions within a businesslike R&D, production, sales and
marketing, customer service, and finance. A companys marketing strategy, for example,
represents the managerial game plan for running the sales and marketing part of the business. A
companys product development strategy represents the game plan for keeping the companys
product lineup in tune with what buyers are looking for. The primary role of functional strategies
is to flesh out the details of a companys business strategy. Lead responsibility for functional
strategies within a business is normally delegated to the heads of the respective functions, with
the general manager of the business having final approval. Since the different functional-level
strategies must be compatible with the overall business strategy and with one another to have
beneficial impact, the general business manager may at times exert stronger influence on the
content of the functional strategies.

4.0 Designing The Business Portfolio

4.1 Definition:
The business portfolio is the collection of businesses and products that make up the company.
The best business portfolio is one that fits the company's strengths and helps exploit the most
attractive opportunities.
The company must:

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(1) Analyze its current business portfolio and decide which businesses should receive more or
less investment.
(2) Develop growth strategies for adding new products and businesses to the portfolio, whilst at
the same time deciding when products and businesses should no longer be retained.
The two best-known portfolio planning methods are the Boston Consulting Group Portfolio
Matrix (BCG Matrix) and the McKinsey / General Electric Matrix (GE Matrix). The first step is
to identify the various Strategic Business Units (SBU) in a company portfolio. An SBU is a unit
of the company that has a separate mission and objectives and that can be planned independently
from the other businesses. An SBU can be a company division, a product line or even individual
brands - it all depends on how the company is organized.

4.2 Analyzing Current SBUs: Boston Consulting Group Approach

The BCG Growth-Share Matrix is a portfolio planning model developed by Bruce Henderson of
the Boston Consulting Group in the early 1970's. It is based on the observation that a company's
business units can be classified into four categories based on combinations of market growth and
market share relative to the largest competitor, hence the name "growth-share". Market growth
serves as a proxy for industry attractiveness, and relative market share serves as a proxy for
competitive advantage. The growth-share matrix thus maps the business unit positions within
these two important determinants of profitability.
This framework assumes that an increase in relative market share will result in an increase in the
generation of cash. This assumption often is true because of the experience curve; increased
relative market share implies that the firm is moving forward on the experience curve relative to
its competitors, thus developing a cost advantage. A second assumption is that a growing market
requires investment in assets to increase capacity and therefore results in the consumption of
cash. Thus the position of a business on the growth-share matrix provides an indication of its
cash generation and its cash consumption.
Henderson reasoned that the cash required by rapidly growing business units could be obtained
from the firm's other business units that were at a more mature stage and generating significant
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cash. By investing to become the market share leader in a rapidly growing market, the business
unit could move along the experience curve and develop a cost advantage. From this reasoning,
the BCG Growth-Share Matrix was born.
The four categories are:

Dogs (Pets) - Dogs have low market share and a low growth rate and thus neither
generate nor consume a large amount of cash. However, dogs are cash traps because of
the money tied up in a business that has little potential. Such businesses are candidates
for divestiture.

Question marks - Question marks are growing rapidly and thus consume large amounts
of cash, but because they have low market shares they do not generate much cash. The
result is large net cash consumption. A question mark (also known as a "problem child")
has the potential to gain market share and become a star, and eventually a cash cow when
the market growth slows. If the question mark does not succeed in becoming the market
leader, then after perhaps years of cash consumption it will degenerate into a dog when
the market growth declines. Question marks must be analyzed carefully in order to
determine whether they are worth the investment required to grow market share.

Stars - Stars generate large amounts of cash because of their strong relative market share,
but also consume large amounts of cash because of their high growth rate; therefore the
cash in each direction approximately nets out. If a star can maintain its large market
share, it will become a cash cow when the market growth rate declines. The portfolio of a

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diversified company always should have stars that will become the next cash cows and
ensure future cash generation.

Cash cows - As leaders in a mature market, cash cows exhibit a return on assets that is
greater than the market growth rate, and thus generate more cash than they consume.
Such business units should be "milked", extracting the profits and investing as little cash
as possible. Cash cows provide the cash required to turn question marks into market
leaders, to cover the administrative costs of the company, to fund research and
development, to service the corporate debt, and to pay dividends to shareholders. Because
the cash cow generates a relatively stable cash flow, its value can be determined with
reasonable accuracy by calculating the present value of its cash stream using a discounted
cash flow analysis.

4.3 Analyzing Current SBUs: GEs Strategic Business Planning Grid

The McKinsey/GE Matrix overcomes a number of the disadvantages of the BCG Box. Firstly,
market attractiveness replaces market growth as the dimension of industry attractiveness, and
includes a broader range of factors other than just the market growth rate. Secondly, competitive
strength replaces market share as the dimension by which the competitive position of each
SBU is assessed.
Factors that Affect Market Attractiveness
Whilst any assessment of market attractiveness is necessarily subjective, there are several factors
which can help determine attractiveness. These are listed below:
-Market Size
- Market growth
- Market profitability
- Pricing trends
- Competitive intensity / rivalry
- Overall risk of returns in the industry
- Opportunity to differentiate products and services

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- Segmentation
- Distribution structure (e.g. retail, direct, wholesale

Factors that Affect Competitive Strength

- Strength of assets and competencies
- Relative brand strength
- Market share
- Customer loyalty
- Relative cost position (cost structure compared with competitors)
- Distribution strength
- Record of technological or other innovation
- Access to financial and other investment resources

5.0 Developing Growth Strategies

5.1 The Strategic Planning Gap
Forecasting technique in which the difference between the desired performance levels and the
extrapolated (see extrapolation) results of the current performance levels is measured and
examined. This measurement indicates what needs to be done and what resources are required to
achieve the goals of an organization's strategy

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5.2 Filling Strategic Gap

To fill up the strategic gap, company has three options available:
Intensive Growth

Integrative Growth

Diversification Growth

Market Penetration

Backward Integration

Concentric Diversification

Market Development

Forward Integration

Horizontal Diversification

Product Development

Horizontal Integration

Conglomerate Diversification

Strategy

5.3 Intensive Growth

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5.4 Integrative Growth

5.5 Diversification Growth

6.0 Partnering to Build Customer Relationship

7.0 The Marketing Process

Under the marketing concept, a firm must find a way to discover unfulfilled customer needs and
bring to market products that satisfy those needs. The process of doing so can be modeled in a
sequence of steps: the situation is analyzed to identify opportunities, the strategy is formulated
for a value proposition, tactical decisions are made, the plan is implemented and the results are
monitored. The continuous process of identifying customer needs through analysis of
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internal/external influences and marketing research, setting objectives, and developing a

marketing mix is called Marketing Process.
In other words, Marketing process is a model where the firm should discover a way to realize
discontented customer needs and bring to market products that satisfy those needs. Target
customers stand at the center of the marketing process. There are following steps or elements in
Marketing Process:
1. Analyzing marketing opportunities
2. Selecting target markets
3. Developing the marketing Mix
4. Managing the marketing effort.

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Figure 1.1: The Marketing Process

Target Customers are central to the marketing process. Marketing starts by identifying the needs
of customers. A business then seeks to meet those needs by making the right products available
when customers want to purchase and at prices they are prepared to pay. The whole marketing
process is influenced by the micro and macro environmental factors.
The actors close to the company (the company/firm, suppliers, intermediaries, customers,
competitors) that affect its ability to serve its customers consist the Microenvironment.
The

larger

societal

forces

(Demographic-Economic,

Political-Legal,

Social-Cultural,

Technological-Natural Environment) that affect the whole microenvironment.

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8.0 Analyzing Marketing Opportunities

First step of the marketing process is analyzing market opportunities and availing these
opportunities to satisfy the customer's requirements to have competitive advantage. The
marketing function of analyzing market opportunities is important in the marketing planning
process. Any marketing manager must analyses the long-run opportunities in the market to
improve the business unit's performance. To evaluate its opportunities firms needs to operate a
reliable marketing information system.
Marketing research is an indispensable marketing tool for this purpose. Researching the market
allows the company to gather information about their customers, competitors and any
environmental changes to determine the market opportunities. Once the market opportunities
have been analyzed then modern marketing practice calls for dividing the market into major
market segments, evaluating each segment, and selecting and targeting those market segments
that the company can best serve.

Identify the business environmental forces.

Describe the industry & the outlook.
Analyze the key competitors.
Create a target market profile.

Set Sales Projection.

Figure: Analyzing Marketing opportunities

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9.0 Selecting Target Markets

To succeed in today's competitive marketplace, companies must be customer centered. They
must win customers from competitors and keep them by delivering greater value. Sound
marketing requires a careful, deliberate analysis of consumers. Since companies cannot satisfy
all consumers in a given market, they must divide up the total market (market segmentation),
choose the best segments (market targeting), and design strategies for profitably serving chosen
segments better than the competition (market positioning). The whole process is known as
Selecting Target Markets.

Figure: Selecting Target Markets

Market segmentation is the process of dividing a market into distinct groups of buyers with
different needs, characteristics, or behavior who might require separate products or marketing
mixes.
Market targeting is the process of evaluating each market segment's attractiveness and selecting
one or more segments to enter. A company should target segments in which it can generate the
greatest customer value and sustain it over time. A company may decide to serve only one or a
few special segments, or perhaps it might decide to offer a complete range of products to serve
all market segments. Special segments may be called "market niches." Most companies enter a
new market by serving a single segment, and if this proves successful, they add segments.

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Market positioning is arranging for a product to occupy a clear distinctive and desirable place
relative to competing products in the minds of target consumers. In positioning a product, a
company first needs to identify possible competitive advantages upon which to build the
position. To gain competitive advantage, the company must offer greater competitive advantage
to the target segment. The company's entire marketing program should support the chosen
positioning strategy. Effective positioning begins with actually differentiating the company's
marketing offer so that it gives consumers more value than they are offered by the competition.

10.0 Developing Marketing Mix

10.1 Definition
Once the company has decided on its overall competitive marketing strategy, it is ready to begin
planning the details of the marketing mix. The marketing mix is the set of controllable
marketing variables that the firm blends to produce the response it wants in the target market.
The marketing mix consists of everything that the firm can do to influence the demand for its
product.
These variables are often referred to as the "Four Ps." generally. But some authors also
characterized them as the Four Cs and Four As

10.2 The Four Ps

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10.3 The Four Cs

10.4 The Four As

11.0 Managing The Marketing Effort

11.1 Definition
The company wants to design and put into action the marketing mix that will best achieve its
objectives in target markets. This involves four marketing management functions. The four
functions are: analysis, planning, implementation, and control. These as a whole consists the
marketing effort.

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Figure : The Marketing Effort

11.2 Marketing Analysis

Marketing analysis involves a complete analysis of the company's situation. The company
performs analysis by Identifying environmental opportunities and threats. Analyzing company
strengths and weaknesses to determine which opportunities the company can best pursue.
Feeding information and other inputs to each of the other marketing management functions

11.3 Marketing Planning

Within each business unit, functional plans must be prepared, including marketing plans. Such
plans include marketing plans which are aggregate plans consisting of plans for product lines,
brands and markets. Marketing planning involves deciding on marketing strategies that will help
the company to attain its overall strategic objectives. A detailed plan is needed for each business,
product, or brand. A product or brand plan should contain the following sections:

Executive Summary,

Current marketing situation,

Threats and opportunity analysis,

Current Marketing Situation

Objectives and Issues

Marketing strategies

Action Programs

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Budgets

Controls.

Figure: Marketing Planning

1. Executive summary The opening section of the marketing plan that presents a short
summary of the main goals and recommendations to be presented in the plan.
2. Current marketing situation - The section of a marketing plan that describes the target
market and the company's position in it. The current marketing situation is the section of a
marketing plan that describes the target market and the company's position in it. Important
sections include:
1). A market description.
2). A product review.
3). Analysis of the competition.
4). A section on distribution.
3. Opportunities and Issues Analysis- This section requires the marketing manager to look
ahead for threats and opportunities that the product(s) might face. A company marketing
opportunity would be an attractive arena for marketing action in which the company would enjoy
a competitive advantage. In the threats and opportunities section, managers are forced to
anticipate important developments that can have an impact, either positive or negative, on the

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firm. Having studied the product's threats and opportunities, the manager can now set objectives
and consider issues that will affect them.
4. Objectives - Objectives should be stated as goals the company would like to reach during the
plan's term.
5. Marketing strategy - The marketing logic by which the business unit hopes to achieve its
marketing objectives. Marketing strategy consists of specific strategies for target markets,
marketing mix and marketing expenditure level. Strategies should be created for all marketing
mix components. The marketing budget is a section of the marketing plan that shows projected
revenues, costs, and profits. The last section of the marketing plan outlines the controls that will
be used to monitor progress. This allows for progress checks and corrective action.
6. Action programs - This section sets out what will be done, when, by whom and how much
will be spent doing it.
7. Projected profit-and-loss statement - The marketing budget section of the plan shows
projected revenues, costs and profits/surpluses.
8. Controls - This last section outlines the control measures that will be used to monitor
progress. Goals may be set out weekly, monthly, quarterly, annually or for all such periods.
Following evaluation of results, actions are recommended and implemented in the next period.

11.4 Marketing Implementation

Marketing Implementation is the process that turns marketing plans into marketing actions in
order to accomplish strategic marketing objectives. Whereas marketing planning addresses the
and "why" of marketing activities, implementation addresses the "who", "where", "when", and
"how".
One firm can have essentially the same strategy as another, yet win in the market- place through
faster or better execution. Successful implementation depends on an action program that pulls all
of the people and activities together and forms sound formal organizational structure its decision
and reward structure (HRM functions and procedures) and the firm's marketing strategies fitting
with its company culture (the shared system of values and beliefs).

11.5 Marketing Control

Marketing control is the process of measuring and evaluating the results of marketing strategies
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and plans, and taking corrective action to ensure that marketing objectives
are attained. Control requires four steps:
1. Set Marketing Objectives. (What do we want to achieve?)
2. Set Performance Standards. (What is happening?)
3. Compare Results against standards. (Why is it happening?)
4. Corrections and alterations. (What should we do about it?)

Set Marketing Objectives

(What do we want to
achieve?)

Corrections and
alterations.
(What should we do about
it?)

Set Performance
Standards
(What Is happening?)

Compare Results against

standards.
(Why is it happening?)

Figure: Marketing Control

12.0 Conclusion
Strategic planning and marketing process pays dividends to companies when approached in a
disciplined process with top-down support and bottom up participation. This report is an in depth
analysis of tools and techniques describing proven, tested process for effective strategic planning
and marketing process. The goal was to begin to apply a workable framework and process; one
that when applied would result in a product helpful to guiding and directing the management to
do what is consistent, right and effective for the long term success of the company and
satisfaction of the customer and employees. While we presented one way to conduct the process
of Strategic Planning it is by no means the only way. The process has to fit the culture, resources
and style of the company. It must reinforce the confidence of management to make consistent,
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workable decisions. The benefit of a Strategic Planning discipline is that it facilitates effective
decision making, better selection of tactical options and it leads to a higher probability of
achieving the owners or stakeholders goals and objectives. Think of Strategic Planning as a
series of concentric circles. The vision, mission strategy and tactics are included in the circles
moving from vision on the outside to tactics on the inner most circles. All are in alignment and
consistent with each other. Now add two more circles. The first is the customer circle. If the
company vision, mission, strategy and tactics are in alignment with that of the customer then this
circle will also be aligned. To the extent it is misaligned there is conflict between the company
and the companys customers. The third circle is represented by the competition. This circle, in
the best situation, will be totally misaligned with the company and the customer meaning the
company is uniquely positioned and valued by the customer. To the extent the competitive circle
overlaps the company circle there is more head to head competition and more leverage for the
customer to apply. Strategic Planning, to be of real long-term value, must be treated as an
ongoing business process. It must be reflective of the organizations mission and vision. It must
evolve and change to reflect changing market and economic conditions. It must be proactive to
competitive conditions. Effective strategic planning and marketing process can institutionalize a
culture of continuous improvement, effective decision making, and disciplined business process.

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