CHAPTER 19

MARKETING PLANNING

CHAPTER OBJECTIVES

1. To define what marketing planning is.

2. To clarify the difference between strategic and tactical marketing
planning.
3. To consider now it fits in with planning for other functions.
4. To explain why it is necessary.
5. To advise where to start.
6. To set out the contents of a strategic marketing plan.
7. To consider how to move from the strategic marketing plan to the
tactical marketing plan.

CHAPTER SUMMARY

The chapter begins by defining marketing planning and making the

distinction between strategic and tactical marketing planning. It then
explains how marketing planning fits in with the overall corporate
planning cycle. The need for planning is discussed along with where to
start the planning process, and the actual contents of the strategic plan are
reviewed. This is followed by an examination of the tactical marketing
plan. The key analytical tools are briefly outlined along with the
marketing planning process itself. Barriers to effective marketing
planning are proposed and the chapter concludes with some final thoughts
and a look to the future.

ANNOTATED LECTURE OUTLINE

Point 1 - Introduction.

Marketing planning, although on the face of it, would appear fairly

simple and straight forward, in reality, this tends not be the case. It is, in
fact, a complex and multifaceted exercise that touches on every aspect of
organizational life.
Point 2 - What is marketing planning.

Marketing planning is a logical sequence and a series of activities leading

to the setting of marketing objectives and the formulation of plans for
achieving them. It is a management process.

Point 3 - Strategic and tactical marketing planning.

A distinction can be made between strategic and tactical planning:

strategy is about doing the right things; tactics are about doing things in
the right way. Survival and success, it has been realised, can only come
from patient and meticulous planning and market preparation, especially
as the environment is much more competitive, complex, fast moving, and
abrasive than it ever has been. Now, more than ever there is a need for
the use of both an effective strategy and efficient tactics.

Point 4 - How marketing planning fits with other functions.

Marketing planning has to be set in the context of strategic planning

generally. There are six accepted strategy-forming models that
organizations can base their strategy on, or a combination of these.
Marketing planning is based on markets, customers, and products whilst
business planning involves other corporate resources.

Point 5 - Why is marketing planning necessary?

The need for marketing planning is based on three issues: the mix of
market types; the mix of margins and sales; and the managerial reasons
for a marketing plan.

Point 6 - Strategic marketing planning: where to start?

If there is a gap between the corporate sales and financial objectives and
the current long-range trends and forecast this has to be filled by one or
more of six key variables.
Point 7 - The contents of a strategic marketing plan.

It is generally accepted that the time span of a strategic plan should be

three years. The contents usually begin with a mission statement which
should be followed by a financial summary, market overview, issues to
be addressed, portfolio summary, assumptions, marketing objectives,
marketing strategies and conclude with resource requirements.

Point 8 - Moving from the strategic marketing plan to the tactical

marketing plan.

The tactical plan follows the strategic plan and focuses on implementing
the first year of the plan. The contents should state the objectives and
strategies, sub-objectives, summary of marketing activities and costs,
contingency plan, operating result and financial costs, key activity
schedule, and any other relevant information.

Point 9 - Key analytical tools in marketing planning and the marketing

process.

There are a number of key analytical tools and techniques that can be
used in the planning process. The marketing process itself should be seen
as circular as this indicates its ongoing nature. The need for formalized
planning depends upon the size and complexity of the organization.

Point 10 - Barriers to effective marketing planning.

Although the need for marketing planning in organizations is recognized,

it would seem that few companies actually implement planning
successfully. Two key barriers have been identified: cultural/political,
and cognitive, in addition, a number of conditions have to be met in order
for the planning to be effective.

Point 11 - The future

It is felt that whatever changes are likely to take place there will always
be a need for marketing planning and this planning is likely to increase in
terms of its complexity due to the growth in globablization of markets,
customer power and technological advances.

Point 12 - Conclusion.

The purpose of marketing planning is the identification and creation of

sustainable competitive advantage. It is a logical sequence of activities
and is necessary because of the complexity caused by many internal and
external factors that affect an organizations ability to achieve its
objectives. There are two outputs from the process of marketing
planning: the strategic marketing plan; and the tactical marketing plan.
The degree of formalization depends upon the firms size and complexity
put the need of the process is universally applicable.

Answers to the discussion questions:-

1. Students should recognise the long-term nature of strategic planning

and the fact that it covers market position, market needs, company
objectives an strategies and the resources required to achieve these.
Tactical planning focuses on implementing the first year of the
strategic plan, so is short-term, and gives specific actions and
resources related to this time period.
2. This was mainly due to a world-wide recession and the increasing
complexity, and competitiveness of markets.
3. It is to help ensure the long-term financial health of the organization in
the face of an ever changing environment.
4. These are given in Section 7 pp460.
5. It is probably best that these are written down and circulated to other
departments within the organization who will be affected by their
implications.
6. Strategic planning is much wider than budgeting. However, the
former is more difficult and complex and requires a great deal of
information from a wide variety of sources. Lack of knowledge and
experience of the process may also play their part. (See Section 11
pp466)
7. This depends upon the size and complexity of the organization.
8. This is the converse of the conditions given at the end of Section 11.
MINI CASE
THE DYNAMIC MANAGER

Discussion question:-

The following points are given as a guide only.

Good practice:-
Preparation of a marketing plan
Carried out SWOT
Addressing weaknesses
Attempt at quantifying objectives
Some understanding of costs and margins
Good idea of market and has identified segments
Revision of the service mix
Trimmed minor services,
Monitoring changes to service
Preparation of a gap analysis
Recognition of the need to make cuts

Bad practice:-
Appears more concerned with tactical rather than strategic planning
No clear idea of overall strategy
No evidence of planning team kick-off
No shared understanding of ideas
No evidence of unit managers having carried out marketing audit
No planning team discussions of plans
Reactive not proactive in the face of competitive pressures
 Made changes to systems without planning
Sales force being told to hit all accounts at once - no prioritisation
although it is acknowledged that relationships with key accounts could
be improved
Not devoted enough time to planning process
Measurement and reward systems do not appear to be linked to the
critical success factors.

CASE 4

THE PEERLESS SAW COMPANY

1. Students need to carry out a full analysis of the costs in this case in
order to explain where and why they are rising. They also need to
identify areas of possible inefficiencies.
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