Lecture Marketing (11/e): Chapter 22 – Kerin, Hartley, Rudelius

McGraw­Hill/Irwin                                                                                                                                                       Copyright  © 2013 by The McGraw­Hill Companies, Inc.  All rights reserved.

22-1


LEARNING OBJECTIVES (LO)
AFTER READING CHAPTER 22, YOU SHOULD BE ABLE TO:

LO1

Explain how marketing managers
allocate their limited resources.

LO2

Describe two marketing planning
frameworks: Porter’s generic business
strategies and synergy analysis.

LO3

Explain what makes an effective
marketing plan.

22-2


LEARNING OBJECTIVES (LO)
AFTER READING CHAPTER 22, YOU SHOULD BE ABLE TO:

LO4

Use a Gantt chart to schedule a series
of tasks.

LO5

Describe the alternatives for organizing
a marketing department
and the role of a product manager.

LO6

Explain how marketing ROI, metrics,
and dashboards relate to evaluating
marketing programs.
22-3


REACHING TODAY’S ON-THE-GO CONSUMER BY
BREAKING THE RULES AT “BIG G”

22-4


REACHING TODAY’S ON-THE-GO CONSUMER BY
BREAKING THE RULES AT “BIG G”


Cereal Industry Facts of Life
• 1 of 4 Brands Succeeds

• Decline in RTE Cereals
• High New-Product Risk
• Conflicting Consumer Intentions/Actions
22-5


REACHING TODAY’S ON-THE-GO CONSUMER BY
BREAKING THE RULES AT “BIG G”


Creative Initiatives Outside Cereals
• Eat-on-the-Go Products

Magic Brownie

• Single Portions
• Healthier Eating
• Cooking Convenience
22-6


LO1

MARKETING BASICS: DOING WHAT WORKS
AND ALLOCATING RESOURCES
FINDING AND USING WHAT REALLY WORKS



Strategy: Clear and Focused



Execution: Flawless Operations
• Kaizen



Culture: Performance-Oriented



Structure: Fast, Flexible, and Flat
22-7


MARKETING BASICS: DOING WHAT WORKS
LO1
AND ALLOCATING RESOURCES
USING SALES RESPONSE FUNCTIONS



Sales Response Function



Maximizing Incremental Revenue
Minus Incremental Cost



A Numerical Example of
Resource Allocation
• Year 1

• Year 4
22-8


FIGURE 22-1 A sales response function
shows the impact on sales at various levels
of marketing effort on annual sales revenue

22-9


MARKETING BASICS: DOING WHAT WORKS
LO1
AND ALLOCATING RESOURCES
USING SALES RESPONSE FUNCTIONS



Allocating Marketing
Resources in Practice



Share Points—Need Estimates of:

• Market Share

• Cannibalization

• Revenues
• Gross Margin
22-10


FIGURE 22-2 The actions in the strategic
marketing process are supported and
directed by detailed reports, studies, and
memos

22-11


LO1

MARKETING BASICS:
ALLOCATING RESOURCES
USING SALES RESPONSE FUNCTIONS



Resource Allocation and the
Strategic Marketing Process



Output Reports

22-12


LO1

THE PLANNING PHASE OF THE
STRATEGIC MARKETING PROCESS
THE IMPORTANCE OF METRICS IN MARKETING PLANNING



“If You Don’t Where You’re Going,
Any Road Will Get You There.”



Innovation Metrics
• Output Metric
• Input Metric
22-13


FIGURE 22-3 Metric ranked No. 1 by
respondents from organizations using more
than three innovation metrics

22-14

LO1

THE PLANNING PHASE OF THE
STRATEGIC MARKETING PROCESS
THE VARIETY OF MARKETING PLANS



Long-Range Marketing Plans



Annual Marketing Plans

22-15


LO2

THE PLANNING PHASE OF THE
STRATEGIC MARKETING PROCESS
MARKETING PLANNING FRAMEWORKS



Porter’s Generic Business Strategies



Cost Leadership Strategy



Differentiation Strategy



Cost Focus Strategy



Differentiation Focus Strategy
22-16


FIGURE 22-4 Porter’s four generic business
strategies involve combinations of
competitive scope and costs vs. product
differentiation

22-17


LO2

Campbell’s Soup and IKEA
Which of Porter’s generic business strategy does each use?

22-18

LO2

THE PLANNING PHASE OF THE
STRATEGIC MARKETING PROCESS
SYNERGY ANALYSIS



Synergy Analysis
• Marketing Synergy
• R&D-Manufacturing
Synergy
22-19


LO2

MARKETING MATTERS
A Test of Your Skills: Where are the Synergies?

1. Where are the marketing synergies?
2. Where are the R&D-manufacturing synergies?
3. What is the ideal market-product grid for a merger?

22-20


FIGURE 22-5 Market-product grids show

alternative strategies for a lawnmower
manufacturer

22-21


LO2

THE PLANNING PHASE OF THE
STRATEGIC MARKETING PROCESS
SYNERGY ANALYSIS



Market-Product Concentration



Market Specialization



Product Specialization



Selective Specialization



Full Coverage
22-22


FIGURE 22-6 The ideal merger for Great
Lakes to obtain full market-product
coverage

22-23


LO3

THE PLANNING PHASE OF THE
STRATEGIC MARKETING PROCESS
MARKETING PLANNING AND STRATEGY LESSONS



Guidelines for an Effective
Marketing Plan
• Set Measurable, Achievable Goals
• Use a Base of Facts and Assumptions
• Use Simple, but Clear and Specific Plans
• Have Complete and Feasible Plans
22-24


LO3

THE PLANNING PHASE OF THE
STRATEGIC MARKETING PROCESS
MARKETING PLANNING AND STRATEGY LESSONS



Guidelines for an Effective
Marketing Plan
• Make Plans Controllable and Flexible
• Find the Right Person to Implement
• Work Toward Concensus-Building

22-25