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Chapter 2 Lecture Notes
Strategic Marketing Planning
Chapter 2: Strategic Marketing Planning
Chapter Outline
I. Introduction
A. Beyond the Pages 2.1 discusses the history and phenomenal success of Redbox.
B. Although the process of strategic marketing planning can be complex (a large
multinational corporation) or relatively straightforward (a small single proprietor
business), the planning process is the same in many ways.
C. Large or small, all marketers strive to meet the needs of their customers while
meeting their own business and marketing objectives.
II. The Strategic Planning Process
A. Whether at the corporate, business unit, or functional level, the planning process
begins with an in-depth analysis of the organization's internal and external
environments—sometimes referred to as a situation analysis.
B. Planning efforts within each functional area will result in the creation of a
strategic plan for that area. [Exhibit 2.1]
C. A marketing plan is a written document that provides the blueprint or outline of
the organization's marketing activities, including the implementation, evaluation,
and control of those activities. The marketing plan serves a number of purposes:
2. It serves as the "road map" for implementing the marketing strategy.
4. It provides specifics regarding the allocation of resources and includes the
specific marketing tasks, responsibilities of individuals, and the timing of
all marketing activities.
D. Marketing decisions must be made within the boundaries of the organization's
overall mission, goals, and objectives.
E. Organizational Mission versus Organizational Vision
1. A mission, or mission statement, seeks to answer the question "What
business are we in?" It is a clear and concise statement (a paragraph or two
at most) that explains the organization's reason for existence.
2. A vision, or vision statement, seeks to answer the question "What do we
want to become?" An organization's vision tends to be future oriented, in
that it represents where the organization is headed and where it wants to
go.
3. Elements of the Mission Statement
a) A well-devised mission statement for any organization, unit within
an organization, or single-owner business should answer the same
five basic questions:
1) Who are we?
2) Who are our customers?
Chapter 2 Lecture Notes
Strategic Marketing Planning
control serves as the beginning point for the planning process in the next
planning cycle.
III. The Marketing Plan
A. The marketing plan provides a detailed formulation of the actions necessary to
carry out the marketing program. Think of the marketing plan as the handbook for
marketing implementation, evaluation, and control.
1. A marketing plan is not the same as a business plan.
2. A good marketing plan requires a great deal of information from many
different sources. This requires looking at the marketing plan holistically
rather than as a collection of related elements.
B. Marketing Plan Structure [note also the Appendix]
2. A good marketing plan outline is:
a) comprehensive: to ensure that there are no omissions of important
information.
b) flexible: to ensure the plan will fit the unique needs of your
situation.
c) consistent: to ensure that the marketing plan and the planning
process will be understood by executives and employees outside of
marketing.
d) logical: to ensure that the plan can be sold to top managers.
3. Executive Summary
a) The executive summary is a synopsis of the overall marketing plan,
with an outline that conveys the main thrust of the marketing
strategy and its execution.
b) Individuals both within and outside of the organization may read
the executive summary for reasons other than marketing planning
or implementation.
c) The executive summary should always be the last element to be
written because it is easier (and more meaningful) to write after the
entire marketing plan has been developed.
4. Situation Analysis
a) The situation analysis summarizes all pertinent information
obtained about three key environments: the internal environment,
the customer environment, and the firm’s external environment.
b) A clear and comprehensive situation analysis is one of the most
difficult parts of developing a marketing plan.
5. SWOT (Strengths, Weaknesses, Opportunities, and Threats) Analysis
a) SWOT analysis focuses on the internal factors (strengths and
weaknesses) and external factors (opportunities and threats)—
derived from the situation analysis in the preceding section—that
Chapter 2 Lecture Notes
Strategic Marketing Planning
c) Opportunities and threats are external issues that exist
independently of the firm conducting the analysis. A common
mistake is to list the firm's strategic alternatives as opportunities.
d) Beyond the Pages 2.2 discusses selling products at a loss to gain
market share.
6. Marketing Goals and Objectives
a) Marketing goals and objectives are formal statements of the
desired and expected outcomes resulting from the marketing plan.
b) This section of the marketing plan sets the performance targets that
the firm seeks to achieve and it defines the parameters by which
the firm will measure actual performance in the evaluation and
control phase.
7. Marketing Strategy
a) The strategy section of the marketing plan outlines how the firm
will achieve its marketing objectives.
b) In its broadest sense, marketing strategy refers to how the firm will
manage its relationships with customers in a manner that gives it
an advantage over the competition.
8. Marketing Implementation
a) The implementation section of the marketing plan describes how
the marketing program will be executed. This section also answers
several questions:
1) What specific marketing activities will be undertaken?
2) How will these activities be performed?
3) When will these activities be performed?
4) Who is responsible for the completion of these activities?
5) How will the completion of planned activities be
monitored?
6) How much will these activities cost?
b) Without a good plan for implementation, the success of the
marketing strategy is seriously jeopardized. For this reason, the
implementation phase of the marketing plan is just as important as
the marketing strategy phase.
9. Evaluation and Control
a) This section of the marketing plan details how the results of the
marketing program will be evaluated and controlled.
b) Marketing control involves establishing performance standards,
assessing actual performance by comparing it with these standards,
and taking corrective action if necessary to reduce discrepancies
between desired and actual performance.
c) The financial assessment of the marketing plan is also an important
component of evaluation and control. Estimates of costs, sales, and
revenues determine financial projections.
d) A marketing audit—a systematic examination of the firm's
marketing objectives, strategy, and performance—can be used to
pinpoint potential causes for discrepancies.
Chapter 2 Lecture Notes
Strategic Marketing Planning
C. Using the Marketing Plan Structure
1. Plan ahead: Writing a comprehensive marketing plan is very time
consuming, especially if the plan is under development for the first time.
2. Revise, then revise again: After the situation analysis, you will spend most
of your time revising the remaining elements of the marketing plan to
ensure that they mesh with each other.
3. Be creative: A marketing plan is only as good as the information it
contains and the effort and creativity that go into its creation.
4. Use common sense and judgment: Writing a marketing plan is an art.
Common sense and judgment are necessary to sort through all of the
information, weed out poor strategies, and develop a sound plan.
5. Think ahead to implementation: As you develop the plan, you should
always be mindful of how the plan will be implemented.
6. Update regularly: Once the marketing plan has been developed and
implemented, it should be updated regularly with the collection of new
data and information.
7. Communicate to others: One critical aspect of the marketing plan is its
ability to communicate to colleagues, particularly top managers who look
to the marketing plan for an explanation of the marketing strategy, as well
as for a justification of needed resources, like the marketing budget.
D. Purposes and Significance of the Marketing Plan
1. A good marketing plan will fulfill five purposes in detail:
a) It explains both the present and future situations of the
organization. This includes the situation and SWOT analyses and
the firm's past performance.
b) It specifies the expected outcomes (goals and objectives) so that
the organization can anticipate its situation at the end of the
planning period.
c) It describes the specific actions that are to take place so that the
responsibility for each action can be assigned and implemented.
d) It identifies the resources that will be needed to carry out the
planned actions.
e) It permits the monitoring of each action and its results so that
controls may be implemented. Feedback from monitoring and
control provides information to start the planning cycle again in the
next time frame.
2. These five purposes are very important to various persons in the firm. The
most pressing concern for success, however, may lie in the fourth purpose.
E. Organizational Aspects of the Marketing Plan
1. In many organizations, the marketing manager, brand manager, or product
manager writes the marketing plan.
2. The authority to approve the marketing plan is typically vested in upper-
level executives. These top managers ask:
a) Will the proposed marketing plan achieve the desired marketing,
business unit, and corporate goals and objectives?
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3. In most cases, final approval of the marketing plan lies with the president,
chairman, or CEO of the organization.
4. Once a marketing plan has been approved, it still faces many obstacles
before its marketing programs can come to fruition. [Exhibit 2.4]
IV. Maintaining Customer Focus and Balance in Strategic Planning
A. Many firms have changed the focus and content of their marketing plans. Of these
changes, two stand out: (1) renewed emphasis on the customer, and (2) the advent
of balanced strategic planning.
B. These changes have required shifting focus from the company's products to the
unique requirements of specific target market segments, as well as tighter
integration with other functional areas.
C. Customer-Focused Planning
1. Focusing on the customer has not been the hallmark of strategic planning
throughout history. The emphasis in marketing planning has shifted from
production (efficiency and quality), to selling, to the marketing concept.
2. The marketers of today focus on long-term, value-added relationships with
customers, employees, suppliers, and other partners. The focus has shifted
from customer transactions to customer relationships, and from
competition to collaboration.
3. Market-oriented firms successfully generate, disseminate, and respond to
market information. These firms focus on customer analysis, competitor
analysis, and integrating the firm's resources to provide customer value
and satisfaction, as well as long-term profits.
4. For an organization to be truly market oriented, it must instill a corporate
culture that puts customers first. [Exhibit 2.5]
5. In today's business environment, an orientation towards customers also
requires that the organization's suppliers and even competitors be
customer-oriented as well.
6. Beyond the Pages 2.3 discusses how Amazon created the ecosystem
1. As firms approached the twenty-first century, they realized that traditional
2. These assets are increasingly important to business success, but are not
reported through traditional financial measures.
3. The balanced scorecard approach aligns strategic efforts by approaching
strategy from four complementary perspectives: financial, customer,
Chapter 2 Lecture Notes
Strategic Marketing Planning
4. The balanced scorecard has been used successfully by many organizations.
These firms tend to adhere to five common principles:
a) Translate the strategy into operational terms
b) Align the organization to strategy
c) Make strategy everyone’s everyday job
d) Make strategy a continual process
e) Mobilize change through executive leadership
5. The balanced scorecard doesn’t refute the traditional approach to strategic
6. The balanced scorecard forces organizations to explicitly consider during
strategy formulation those factors that are critical to strategy execution.
Issues within the balanced scorecard such as employee training, corporate
culture, organizational learning, and executive leadership are critical to the
implementation of any strategy.
Questions for Discussion
1. In many organizations, marketing does not have a place of importance in the
organizational hierarchy. Why do you think this happens? What are the consequences for
a firm that gives little importance to marketing relative to other business functions?
Student answers to this question will vary based on their professional experiences. One
2. Defend or contradict this statement: Developing marketing strategy is more important
than implementing marketing strategy because, if the strategy is flawed, its
implementation doesn’t matter.
3. What are some of the potential difficulties in approaching strategic planning from a
balanced perspective? Isn’t financial performance still the most important perspective to
take in planning? Explain.
Chapter 2 Lecture Notes
Strategic Marketing Planning
Some students will argue for the importance of the financial perspective arguing that
firms are in business to make money for shareholders. These students will favor stock
Exercises
1. Review each of the mission statements listed in Exhibit 2.2. Do they follow the
guidelines discussed in this chapter? How well does each answer the five basic
questions? What do you make of the changes or lack thereof in these mission statements
over time?
Most students will remark that these (and many other) mission statements do not fully
2. Talk with a small-business owner about the strategic planning process he or she uses. Do
they have a mission statement? Marketing goals and objectives? A marketing plan? What
are the major issues the owner faces in implementing his or her marketing program?
Students will be surprised to learn that many (most) small businesses do very little formal
3. Palo Alto Software maintains a website devoted to business and marketing plans. Log on
to www.mplans.com/sample_marketing_plans.php and take a look at a few of the sample
marketing plans available. Do these plans use the same framework discussed in this
chapter?
