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1.1 Introduction
The company’s strategic plan establishes what kinds of businesses the company will operate
and its objectives for each. Marketing plays a key role in the company’s strategic planning in
several ways. First, marketing provides a guiding
philosophy—the marketing concept—that
suggests that company strategy should revolve around building profitable relationships with
important consumer groups. Second, marketing provides
inputs to strategic planners by helping
to identify attractive market opportunities and assessing the firm’s potential to take advantage
of them. Finally, within individual business units, marketing designs
strategies for reaching
the unit’s objectives. Once the unit’s objectives are set, marketing’s task is to help carry them
out profitably.
1.2 Learning Outcomes from the Module Outline
LO.1 Describe the steps involved in the strategic marketing planning process.
LO.2 Discuss the types of analysis available to aid marketing planners in formulating
LO.3 Explain and understand the procedures involved in carrying out a situation analysis.
LO.4 Understand why control is so important to long-term success.
1.3. Introducing strategic marketing planning process (STP)
The management process, as applied to marketing, consists basically of (1) planning a
marketing program, (2) implementing it, and (3) evaluating its performance. The planning
stage includes setting goals and designing strategies and tactics to reach these goals. The
implementation stage entails forming and staffing the marketing organization and directing the
actual operation of the organization according to the plan. The evaluation stage consists of
analyzing past performance in relation to organizational goals. This third stage indicates the
interrelated, ongoing nature of the management process. That is, the results of this stage are
used in planning goals and strategies for future periods (Etzel et al., 1997).

Figure 1: The management process in marketing
The foundation of the marketing strategy should be an analysis of current and future market
conditions and an assessment of your own core competencies and resources. Besides analyzing
the company environment and general market conditions, the most important factors and
changes in the customer environment and competitive environment are important when
formulating a marketing strategy. In addition to general market analyses (like market growth),
changes in customer behavior must also be determined. With the help of an in-house analysis
of existing competencies, processes, and the company’s market situation (such as current
market share, customer loyalty, etc.), future positioning options and their feasibility can be
examined and discussed. Based on the positioning of choice and the business potential
associated with it, you can work out points in the marketing strategy, such as specific customer
benefits, positioning with respect to the competition, specifying a distribution channel strategy,
and designing the marketing mix
(Strauss, 2008).
Marketing-driven organizations rely on strategic marketing planning to formulate their plans
and to make their plans and make their marketing management decisions. Organizations that
plan carefully and thoughtfully possess a competitive edge over firms that do not. Marketing
strategy is the long-term plan for developing a marketing mix that will achieve the
organization’s objectives. Marketing tactics include the short-term details of the plan. The
Set goals
Select strategies and tactics
Performance with
Feedback, so management can adapt future plans and their implementation to the
changing environment

following figure illustrates the steps in the strategic marketing planning process (Kinnear et
Figure 2: The Strategic Marketing Planning Process
After conducting strategic planning for the organization as a whole, management needs to lay
plans for each major functional area, such as marketing or production. Of course, planning for
each function should be guided by the organization-wide mission and objectives (Etzel et al.,
Defining the business
Every successful organization, whether for-profit or non-profit has a vision of what it is all
about. The organization’s business definition (sometimes called mission statement) answers
the question, “What businesses are we in?”. It provides thrust and direction to the organization
Define the business
Perform a situation
Establish objectives
Form marketing
marketing tactics

and is the cornerstone of its marketing strategy. Southwest Airlines defines its business as “the
best alternative to car and bus travel”. This definition provides direction for the firm’s
marketing activities. A firm’s business definition, of course, may change over time. Such
changes are typically reflected in changes in marketing strategy as well.
A good business definition should be:

specific enough to impact the behavior of the organization
focused more upon the satisfaction of customers’ needs than the characteristics of the
company’s product
able to reflect the essential skills of the organization
flexible (Kinnear et al., 1995).

Situation analysis
Situation analysis involves analyzing where the company’s marketing program has been, how
it has been doing, and what it is likely to face in the years ahead. Doing this enables
management to determine if it is necessary to revise the old plans or devise new ones to achieve
the company’s objective.
Situation analysis normally covers external environment forces and internal nonmarketing
resources. A situation analysis also considers the groups of consumers served by the company,
the strategies used to satisfy them, and key measures of marketing performance. As part of
situation analysis, many organizations perform a SWOT assessment. In this activity, a firm
identifies and evaluates its most significant strengths, weaknesses, opportunities and threats
(Etzel et al., 1997).

Figure 3: SWOT analysis
A SWOT analysis is divided into two main categories: internal factors and external factors. It’s
important to point out that strengths and weaknesses are current or backwards-looking, and
opportunities and threats are forward-looking. By performing a SWOT analysis, we will be
able to build a bridge between what the company has accomplished to date and the strategic
alternatives that are going to be generated.
Internal factors are the strengths and weaknesses of the company. Strengths are the
characteristics that give the business its competitive advantage, while weaknesses are
characteristics that a company needs to overcome in order to improve its performance.
Examples of internal factors include Company culture, Company image, Operational
efficiency, Operational capacity, Brand awareness, Market share, Financial resources, Key
staff, Organizational structure.
External factors are the opportunities and threats to the company. Opportunities are
elements that the company sees in the external environment that it could pursue in the future
to generate value. Threats are elements in the external environment that could prevent the
company from achieving its goal or its mission or creating value.

Changes in the external environment may be due to Societal changes, Customers, Competitors,
Economic environment, Government regulations, Suppliers, Partners, Market trends
Corporate Finance Institute).
Establishing objectives
Good objectives must (1) specify exactly what is to be accomplished, (2) designate a
quantitative level to be attained, and (3) specify a time frame for meeting the objective.
Objectives provide the baseline against which actual performance is measured, and as such,
they are necessary to control the business. Therefore, it is important that the objective must be
Most organizations have multiple objectives. When this is the case, it is necessary for the
objectives to be consistent with each other. Objectives are established at various levels within
an organization. Top management is most likely the source of overall business objectives,
which must be filtered down into the objectives for the various functional areas within the
organization (Kinnear et al., 1995).
1.3.1. Forming a marketing strategy
Developing a marketing strategy is similar to planning for a trip. To plan a trip, it is necessary
to determine where you want to go but it is just as important to know where your trip will start.
Knowing your starting point and the desired destination can be described as the vision for the
trip or for a marketing strategy. The mission for the trip is more about the experience you hope
to have as you complete the journey. is experience will be determined in part by the resources
available to you including time, money, modes of transportation, and so forth. For a marketing
strategy, the mission or the experience you hope to have is driven by the hope for the business
outcome, usually expressed in financial terms and desired market position. These outcomes are
also determined in part by the resources available to the organization. To plan for a trip, you
take the time to think about the time you will be travelling to your destination, the time you
will stay, and the activities in which you will participate. is will require an assessment of your
available resources and how they may be managed to allow you to enjoy the trip is may mean
that you would choose a less expensive model of travel to be able to participate in more
activities at the destination. is planning will also consider factors such as the weather, airline

flight cancellations, and accommodation availability. For a marketing strategist, the planning
for the trip stage is similar to the situation analysis—taking stock of the competitive landscape,
the market opportunities and challenges, the organization’s resources and capabilities, and the
outside forces that may affect the implementation of a strategy (Randazzo, 2014).
Marketing strategy is the long-term for developing a marketing mix that will achieve the
organization’s objectives by meeting the target market’s needs. Marketing, strategy hence,
must begin with the identification of the target market. The marketing strategy should define
the product and its characteristics (product decisions), it should explain how the product should
be brought to the user (distribution decisions), it should describe how the target market will be
made aware of the product and persuaded to buy it (promotion decisions), and finally, it should
specify the relative value of the offer vis-a-vis alternatives (price decisions).
Sometimes changes in the internal or external environment factors (or both) can occur very
quickly. Thus, an organization should have a contingency plan that will help it to adapt. With
contingency planning, changes in strategy are developed before environmental and internal
factors change (Kinnear et al., 1995).
To succeed in today’s competitive marketplace, companies must be customer-centred. They
must win customers from competitors and then keep and grow them by delivering greater
value. But before it can satisfy customers, a company must first understand customer needs
and wants. Thus, sound marketing requires careful customer analysis.
Companies know that they cannot profitably serve all consumers in a given market— at least
not all consumers in the same way. There are too many different kinds of consumers with too
many different kinds of needs. Most companies are in a position to serve some segments better
than others. Thus, each company must divide up the total market, choose the best segments,
and design strategies for profitably serving chosen segments. This process involves
, market targeting, differentiation, and positioning (Kotler and Armstrong, 2012).



Harvest/manage for

Strategic focus
Expand market


Brand objective

Brand preference
Brand loyalty
Brand exploitation



Creating awareness/
trial/repeat purchase

awareness/ repeat




Figure 4: Marketing Objectives and Strategies Over the Product Lifecycle
Implementing marketing tactics
While strategy provides guidance regarding how to accomplish objectives, the firm must make
specific decisions about each element of marketing mix before implementation. These preimplementation specifics are called marketing tactics. Marketing tactics bring an
organization’s marketing strategy to life. Tactics form the heart of the organization’s shortterm marketing plan. This plan takes the long-term marketing strategy, the strategic marketing
plan, as a given and develops detailed executions on each marketing mix element. These
executions become a blueprint for implementation. Tactical decisions in the area of the product

would include specifications regarding the number of the different product items the firm will
carry, the styling and the functional features of each item (Kinnear et al., 1995).
1.3.2 Selected planning models
A number of frameworks or tools – we’ll come them models – have been designed to assist
with strategic planning. Most of these models can be used with both strategic company
planning and strategic marketing planning.
Figure 5: The Boston Consulting Group (BSG), Growth-share Matrix
Figure 6: General Electric Market, Attractiveness–Competitive Position Model
Marketing control
The function of marketing control is to give the manager feedback on how the plans are
progressing. The purpose of marketing control is to maximize the probability that the
organization will achieve its short-run and long-run objectives in the marketplace (
Kotler and
Andreasen, 2008
). The organization should undertake two types of control: tactical (short-run)
control and strategical (long-run) control. Tactical control is concerned with the short-term
marketing plan of the organization. It assesses the effectiveness of the tactics developed to
carry out the strategy. Strategic control assesses the effectiveness of the organization long-term
marketing strategy. A good way to distinguish the two type of control is to consider which
question control is addressing:

Are we doing the right things? (Strategic control)
Are we doing things right? (Tactical control)
(Kinnear et al., 1995)

Market attractiveness criteria

Market size

Market growth rate

Beatable rivals

Market entry barriers
Social, political and legal factors


Competitive strength criteria

Market share
Distribution capability
Market knowledge
Service quality
Innovation capability
Cost advantages
Powerful brand
1.4 Summary
Through this topic overview, we have set the basis for marketing strategy and its planning
process. In the following week, we will examine ethics and unethical behavior in organizations.
Corporate Finance Institute. Available at,
Etzel, J. M., Walker, J. B., and Stanton, J. W., (1997), Marketing, McGraw- Hill.
Kinnear, C. Th., Bernhardt, L. K., and Krentler, A. K., (1995), Principles of Marketing, Harper
Collins Publishers.
Kotler, P. and Andreasen A., R. (2008).
Strategic Marketing for Non Profit Organizations (7th
edition), Prentice-Hall.
Kotler, P. and Armstrong, G., (2012),
Principles of Marketing, Pearson Education.
Randazzo, W. G., (2014), Developing Successful Marketing Strategies, Business Expert Press.
Strauss, R., (2008),
Marketing Planning by Design: Systematic Planning for Successful
Marketing Strategy
, John Wiley & Sons.



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