SBU Strategic Planning

Provides the context for the preparation of the marketingplans for the units products and services.

1. Defining Business Mission
2. Analyzing External Environment (OT) (economic, demographic, technology, political, legal, socio and cultural, markets, competitors, collaborators etc.)
3. Analyzing Internal Environment (SW) (competitive advantages, vulnerabilities, positioning)
4. Choosing Objectives and Goals (specific, measurable, achievable and consistent)
5. Developing Business Strategies (cost leadership; differentiation; focus)
6. Preparing Programs
7. Implementing Programs (McKinsey 7-S Framework)
8. Gathering Feedback and Exercising Control

If goal is to grow a business by 15%, what other data are relevant to judge the merits of the goal?

Discussion Topic: Create a SWOT analysis of your own business (business unit).

Marketing Plans

Focus on product and market; focus on detailed marketing strategies for achieving the product's objectives in a target market.

Consider the difference between strategic marketing and tactical marketing.
Marketing Planning Process includes:

1. Analyzing marketing opportunities
2. Researching and selecting target markets
3. Designing marketing strategies
4. planning marketing programs (marketing mix)
5. implementation and control

Put another way:

1. Situation Analysis
• Corporate Capabilities and Culture
• Customer Analysis
• Competitive Analysis
• Collaborators
• Macro Issues
• SWOT Analysis
• Objectives
• Alternative Strategies
2. Action Plans
• Evaluation and Recommendations
• Marketing Mix Elements (Product, Price, Promotion, Place)
3. Implementation and Evaluation
• Forecasting and Budgeting
• Measures of Effectiveness

Discuss Can Priceline Remain Profitable with respect to strategic planning issues.
Identify the four Cs: Customer, collaborator, competition and company
Consider past and future growth strategies
Consider the four Ps: Price, Product, Promotion and Place.

Business Markets

More sales by value in B2B than B2C.

Purchase for:

• Production
• Resale
• Redistribution
• MRO (Maintenance, Repair and Operations) 80% business purchases versus ...

In order to:

• Increase Sales
• Cut Costs
• Meet Social and Legal Requirements

Customers are:

• Businesses for Profit
• Non-Profits
• Governments

Characteristics of Business Customers:

• Risk Averse
• Knowledgeable
• Price-oriented
• Fewer and Larger
• Nature of Demand (Derived, Inelastic, Fluctuating)
• Purchase versus Lease

Buying Process consists of:

• Problem Recognition
• General Need Description
• Product Specification
• Supplier Search
• Proposal Solicitation
• Supplier Selection
• Order Routine Specification
• Performance Review

Modified depending on whether: Straight rebuy, Modified rebuy or New task.

Contrast this with the Consumer buying process?

Who makes the purchasing decision?
What are the contextual elements that affect the decision?
What is included in purchase: re: customer service levels etc.

Evolution of Business Buying

• Develop relationships versus adversarial contest: Extranets; increase lock-in.
• Geographic Concentration: Ecosystems

The Evolution of B2B: Lessons From the Auto Industry
GE Global eXchange Services
Dell Medium and Large Business Home Page

Dealing with Competition

Porter's five basic forces of competition:

29.              Threat of new entrants

30.  Rivalry among existing competitors

31.  Bargaining power of suppliers

32.  Bargaining power of buyer

33.  Threat of substitutes

Whenever you make choices with respect to your customers (business or final consumers), you need to be aware how your competition changes as a function of your decisions. Understanding the prisoners dilemma model is useful. Clearly your relation compared to other competitors is important (market leader versus follower for instance) and the nature of the marketplace (monopoly, oligopoly and monopolistic competition).

Consequences of zero percent financing for autos?

Need to consider competitors AND customers for decisions.

Importance of competitive intelligence.

Classification of competitors (brand, industry, form, generic)

Keep competitors?

Industry Concept of Competition:

• Impacts of Barriers to Entry and Exit
• Number of sellers and degree of competition (monopoly, oligopoly, monopolistic competition, pure competition)
• Cost Structure
• Degree of Vertical Integration
• Degree of Globalization

New Entrants:
Innovators Dilemma
Disruptive Technology
Priceline, Expedia and American Airlines versus Travel Agent market place.

Discussion Topic: Identify and discuss other industries prone to disruptive technologies.

SBA: The Marketing Plan
The Marketing Audit Comes of Age
How to Write a Mission Statement
Link to discussion board
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