Chapter 2:

Strategic Market Planning and the Evaluation of Marketing Opportunities

For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

The Marketing Management Process

Whole-Company Whole-Company Strategic Strategic Management Management Planning Planning Adjust Plans as Needed

Marketing Marketing Planning Planning

Control ControlMarketing Marketing Plan(s) Plan(s) and and Program Program

Exhibit 2-1
2-2

Implement Implement Marketing Marketing Plan(s) Plan(s) and and Program Program

For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

A Marketing Strategy
The Marketing Mix

C
Exhibit 2-2
2-3
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

The Four Ps of the Marketing Mix

Product

Place

C
Price Promotion

Exhibit 2-3
2-4
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Strategy Decision Areas Organized by the Four Ps

Product
Physical Goods Service Features Quality Level Accessories Installation Instructions Warranty Product Lines Packaging Branding

Place
Objectives Channel Type Market Exposure Kinds of Middle man Kinds and Locations of Stores How to Handle Transporting and Storing Service Levels Recruiting Middle men Managing Channels

Promotion
Objectives Blend Salespeople Kind Number Selection Training Motivation Advertising Targets Kinds of Ads Media Type Copy Thrust Who Prepares? Sales Promotion Publicity

Price
Objectives Flexibility Level over Product Life Cycle Geographic Terms Discounts Allowances

Exhibit 2-4
2-5
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Four Examples of Basic Channels of Distribution for Consumer Products

Manufacturer or Producer
CIBC Nissan Del Monte Wholesaler Procter & Gamble Wholesaler Wholesaler Retailer Retailer Retailer

Consumer
Exhibit 2-5
2-6
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Elements of a Firms Marketing Program

Target Market

+
Marketing Mix

Marketing Strategy

Marketing Plan

Time-Related Details and Control Procedures

+
Other Marketing Plans

A Firms Marketing Program

Exhibit 2-7
2-7
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Distribution of Different Firms Based on Marketing Performance

Death-wish marketing Best-practices marketing

(Below average) (Well below average)

68% (Average Marketing Program)

(Above average) (Well above average)

2% Total Failure

14% Poor

Fair

14% Good

2% Exceptional

Exhibit 2-9
2-8
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Types of Opportunities
Four Basic Types of Opportunities
Present Products New Products

Present Markets

Market Penetration

Product Development

New Markets

Market Development

Diversification

Exhibit 2-10
2-9
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Sales and Cost Curves of Two Strategies

Product A Sales

Total cost

In this graphic, a too-narrow focus on the first years results might cause the marketing manager to abandon this product as too costly.

Dollars 0 1

Years

2-10

For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Evaluating Opportunities
Industry Attractiveness
High High Medium Low

Business Strength

Medium

No Growth Low Borderline Growth

Exhibit 2-13
2-11
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Considering International Opportunities

or ld

e tiv eti age mp nt Co va Ad

Sm al

ler

r e t t Be

n e Tr

? s d

Ea y rl t ar St

2-12

For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.

Continuum of Environmental Sensitivity

Insensitive Industrial products Basic commodity-type consumer products

Sensitive Consumer products that are linked to cultural variables

Exhibit 2-14
2-13
For use with Shapiro, Wong, Perreault, and McCarthy texts. Copyright 2002 McGraw-Hill Ryerson Li m i ted.