Module 6

Module 6
Marketing Planning
Module Overview
Marketing Planning: Meaning, Concepts, Steps
involved in Marketing planning, Marketing
Audit- Meaning, Feature, Various components
of Marketing Audit Marketing Strategy-
Analysis of Industry and Competition,
Strategic Planning Process
Marketing planning
Planning
Deciding now
What we are going to do later
How to do
When we are going to do
Planning
General plans
Specific plans
Levels of planning
Process of developing and maintaining a strategic fit
Strategic planning between the organization's goals and capabilities and
its changing marketing opportunities
Operational plan for a particular product or product

line .includes the detailed scheme of the marketing
Marketing planning
strategies an activities associated with each products
marketing mix
Involves specifying details which pertains to the

Tactical planning organization's activities for a specified period of time,
usually one year
Basic elements of strategic planning
Mission SBU
Objectives
Strategic Marketing
planning tools plans
Mission
The most important element in strategic planning
Mission statement states
What customer it serves
What needs it satisfies
What type of product it offers
Is a guideline for the organizations decision
making for both the short and long run
Strategic business units(SBU)
Large organisation with multiple product lines or operating
in many countries create SBUs
Facilitates planning and general operations
SBU can be
One specific product
One Product line
Or specific business
SBU Operates as
a separate, autonomous entity,
establishes its own mission statement, objectives and strategic
as well as marketing plans independent of other SBUs in the
same company
Objectives
Is a desired outcome
Organizations mission statement direct its
objectives
Supporting objectives for each levels of management
Objectives may include
Increase in profit, market share, growth or diversity
Must be clear, concise and realistic
Strategic planning tools

Includes analytical tools and models
involves allocation and prioritization of
resources
Firm has to deicide which products(or SBUs)
most or least deserve additional investments
Product-Market growth matrix
Existing products New products
Market penetration Product development

Existing markets
strategy strategy
Market development
New markets Diversification strategy
strategy
Market penetration strategy
Used mostly for mature products in mature
markets
Market penetration by
Improving quality
Dropping prices
Increasing distribution
Engaging aggressive advertising
Market development strategy
Involves finding new markets and new users for
existing products
Used when new users are found for mature
products
New users are found due to change in consumer
behaviour or demographics
Product development strategy
Introduces new products into established markets
Diversification strategy
Focuses on developing new products for new
markets
Enables a company to be less dependent on any
one product or product line
The BCG Matrix
High
Question
Market growth rate
Stars
mark
Cash cow Dog

Low
High Relative market share Low
The BCG matrix
Boston Consulting Groups growth share matrix
Used to analyze product portfolios of SBUs
Deals with the process of evaluating industry growth
and the relative position of a company in the industry
Matrix classifies the businesses of a company into 4
distinct categories
Stars
Cash cows
Question marks
Dogs
The BCG Matrix
Stars
Are products with high market growth rates and high
market shares
Large investment is required to generate any growth
Challenge is to protect existing market share while
generating more shares of new users
Stars can eventually become cash cows if they sustain their
success until a time when the market growth rate declines.
Companies are advised to invest in stars.
Effort on product improvements, better market coverage,
and price reductions
E.g.: Swift
The BCG Matrix
Cash cows
Cash cows are the leaders in the marketplace and
generate more cash than they consume.
These are business units or products that have a high
market share, but low growth prospects.
Effort to manage cash cows by investing in
improvements to maintain superiority, price leadership
Also to support development of new products and
growth with excess cash
E.g.: Alto, Wagon R
The BCG Matrix
Question marks
These parts of a business have high growth prospects
but a low market share.
They are consuming a lot of cash but are bringing little in
return.
In the end, question marks, also known as problem
children, lose money.
However, since these business units are growing rapidly,
they do have the potential to turn into stars.
Companies are advised to invest in question marks if the
product has potential for growth, or to sell if it does not.
E.g.: Grand Vitara
The BCG Matrix
Dogs
Are products with low market shares and low market growth rates
Dogs are generally considered cash traps because businesses have
money tied up in them, even though they are bringing back
basically nothing in return
Marketers may use the following strategies
Focus on a particular segment and outperform the competition
in that segment
Harvest the product by cutting down expenses on marketing
and other related support activities
Divest the product by selling the business to competitor
Eliminate the product from product line
E.g.: Stingray
The BCG Matrix
Marketing plans
Is a detailed scheme of the marketing strategies and
activities associated with each products marketing mix
Can be of different forms based on the size of the
organisation and the number of products with in its
portfolio
Can be developed
For the entire family of products
For each product line
For each individual product
Short-term plans covering one year period
Marketing planning
Is a written document
containing the guidelines Finance Distribution
for the business centres
marketing programmes
and allocations over the
Marketing
planning period plan
Manufacturing
Sales
Haldirams marketing plan
Product lines of Haldirams
1 2 3 4 5 6 7
Namkeen Sweet Syrups Pickles Papad Dry fruits Tin packed
sweets
1 2
Marketing plan
Objectives of marketing plan
To define the current situation facing the product
To define the problems and opportunities facing the
business
To establish objectives
To define strategies and programmes necessary to
achieve the objectives
To pinpoint responsibility for achieving product
objectives
To encourage careful and disciplined thinking
To establish a customer-competitor thinking
Steps in marketing plan
Analysis of the marketing situation
Developing marketing objectives
Formulation of marketing objectives
Preparing action programmes and budgets
Developing control procedures

Analysis of marketing situation
Is a breakdown n of brands current status in the
market
Involves analyzing the past, present and future of a
companys marketing programme
Covers external and internal environment
Considers
The target group served by the company
The strategies used to satisfy them
Key measures of marketing performance
Analysis using SWOT analysis
SWOT analysis in situational analysis
SWOT analysis
Strengths Weakness
Technological skills Absence of important skills
Leading brands Weak brands
Internal Distribution channels Illogical distribution
factors Customer loyalty Low customer retention
Quality of product/service Unreliable product/service
Economies of scale Sub-scale
Opportunities Threat
Changing customer tastes Changing customer tastes
Liberalization of geographic markets Closing of geographic markets
External Technological advances Technological advances
Changes in govt. policies Changes in govt. policies
factors
Lower professional taxes Tax increases
Change in population age structure New distribution channels
New distribution channels
POSITIVE NEGATIVE
Developing marketing objectives
Must be clear, concise and realistic
Objectives are typically based on profit,
market share, growth, or diversity
Time frame attached to each objective
Formulation of marketing strategies
Acts as a blueprint for the building process for
the brand that will take place over the coming
time period
Decisions about product positioning, and
product differentiation are made
Shows how marketing objectives are achieved
Preparing action programme and budgets
Programmes designed to result some specific
action, as well as the budget required for
supporting marketing activities
Critical stage in planning process since
Entire years budget is either increased, or
decreased based on the plan
Developing control procedures
Details on how the results of the plan will be
measured on ongoing basis
Updates on performance measured against
projections
Control procedures ensure success
Components of the marketing plan
1) Executive summary
2) Situation analysis
3) Threats and opportunities analysis
4) Objectives
5) Marketing strategy
6) Marketing action programmes
7) Budget allocation
8) Monitors and controls
Executive summary
Brief summary of the marketing plan
Focus on objectives, strategies, and expected financial
performance
Useful for quickly reviewing the major elements of the
plan by the top management
Situation analysis
Contains data analysis of the current marketing situation
Describes target market and companys position
Provides information about the market, product or brand
performance, competition, and distribution
Threats and opportunities analysis
Consist of assessment of the major threats and opportunities
that product might face
Helps to anticipate important positive or negative developments
that might have an impact on the firm and its strategies
Objectives
Marketing objectives that the company would like to achieve
during the plans term
Marketing strategy
Outlines the broad measures to be used by the company
Provides the specifics of target markets, positioning and
marketing cost levels
Also explains how each responds to the threats, opportunities
and critical issues
Marketing action programmes
Implementation part of the plan
Spells out how the marketing strategies will be turned into
specific action programmes(what, when, who, how)
Budget allocations
Provides details of a supporting marketing budget
Projected profit loss statements and expected revenues
Monitors and controls
Outlines the controls that will be used to monitor the
progress and allow the top management to review the
progress
Evaluation & Control
MARKETING AUDIT
Evaluation and control
Involves the evaluation of the results of the
marketing strategies and marketing plans
Taking corrective actions to ensure that the
objectives are attained
Two types of marketing controls
a) Operational control
b) Strategic control
Evaluation and control
Operational control
Involves checking ongoing performance against the
annual plan and taking corrective actions when
necessary
Purpose is to ensure that the company achieves the
sales, profits and other goals set out in its annual plan
Strategic control
Involves looking at whether the companys basic
strategies are well matched to its opportunities
Periodically reassessing overall approach to the
marketplace
Reviewing market strategies and programmes
A major tool for strategic control
MARKETING AUDIT
Marketing audit- Introduction
Is an essential element in the marketing control
and evaluation process
Is a comprehensive, systematic, independent and
periodic examination of a company's
environment, objectives, strategies, and activities
to determine problem area and opportunities
Audit provides good input for a plan of action to
improve the companys marketing performance
Covers all the major area of a business
Marketing audit- Introduction
Assesses the following
Marketing environment
Marketing strategy
Marketing organization
Marketing systems
Marketing mix
Marketing productivity
Profitability
Audit is conducted by an experienced outside agency
Identify problem areas in marketing and helps to
anticipate future
Features of marketing audit
Comprehensive Systematic
Independent Periodic
Comprehensive
All the major marketing activities of a
company like 4ps ,sales force management,
profitability, outstandings, bad debts will be
covered by the marketing audit
Problem area can be identified effectively
Systematic
Marketing audit is systematic or orderly
evaluation of companys marketing
environment(both micro and macro)
Corrective actions could be planned by the
management to improve marketing efficiency
Independent
Done by independent outsiders on whom the
marketing managers have no authority or
control
Reduced bias makes it more effective
Periodic
Marketing audit should be scheduled periodically
Bi-monthly
Quarterly
Half yearly
Some organizations initiate marketing audit only
when sales declines or looses market share
Periodic audit helps the organization to identify
problems in advance
Components of marketing audit
Marketing environment audit
Covers the macro environment
Demographic
Economic
Natural
Technological
Political
Cultural
Raises questions as to what trends pose threats and
opportunities for the company
Markets, customers and other factors analyzed
Marketing strategy audit
Audit reviews the companys marketing objectives
and marketing strategy
Appraise how well these are adapted to the
current and forecasted marketing environment.
Checks whether the company has a strong
marketing strategy for achieving its objectives
Checks the resource allocation to various
segments, products, territories and marketing
elements
Marketing organization audit
Audit analyses the formal structure
Functional efficiency
Cross functional efficiency
Verifies whether marketing activities are
optionally structured along functional , product,
market, and territory lines
Marketing systems audit
Audit reviews
Marketing information system,
Marketing planning system,
Marketing control system and
New product development
Checks whether the company is using
marketing research effectively
Marketing productivity audit
Audit examines the profitability analysis and cost
effective analysis
Checks how profitable the companys products,
markets, territories an channels are
Whether the company should enter, expand or
withdraw from any business segments
Marketing functions audit
Audits make in-depth evaluation of major
marketing mix components namely
Products
Price
Place
Promotion
End
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Module 6

Operational plan for a particular product or product

Involves specifying details which pertains to the

Strategic planning tools

Existing products New products

Market penetration Product development

Cash cow Dog

Developing marketing objectives

Formulation of marketing objectives

Preparing action programmes and budgets

Developing control procedures

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