Strategic Marketing Management - Essay Example

?Strategic Marketing Management Table of Contents Introduction 3 The Importance of a Strategic Marketing Plan 4 Strategic Marketing Planning in the Sports Sector 4 Process for Designing a Strategic Plan 6 Corporate Mission 7 Corporate Objectives 7 Analysis of the Market Environment 7 External Environment Analysis 8 SWOT Analysis 11 Marketing Objectives 12 Marketing Strategies 13 Target Market Selection & Product Positioning 14 Action Plans 16 Reviewing and Controlling the Plan 17 Conclusion 17 References 19 Bibliography 21 Introduction Long ago it was mentioned by Peter Drucker that there were two fundamental purposes of any business organization and they were innovation and marketing (Drucker, 1954). The essential task of marketing in any particular enterprise branches out from the reality that marketing is a procedure with the help of which a particular firm builds significance for the selected customers. Value is built when the requirements of the customers are fulfilled. Thus, it is important for a firm to characterize by the advantages made obtainable for the customer. After building the significance for the firm’s customers, it is then given the right to confine a part of it with the help of pricing. In order to sustain as a feasible establishment, it is necessary for the firm to keep on the practice of building and confining value with time. Inside this structure, the plan through which the value is built on a consistent basis is known as the Marketing Strategy of the specific firm. There are fundamentally two actions that are involved with a Marketing Strategy. The first one is to select an intended market and decide the needed positioning for the products in the mind of the aimed customers. And, the second activity is to indicate the desired plan needed for activities in the field of marketing so as to attain the intended positioning (Scribd, 2000). It is important and critical to create a strategic plan as that would help an organization to attain competitive advantage which would further result in the development of the firm (Nilsson & Rapp, 2005). The Importance of a Strategic Marketing Plan Strategic marketing plan is appropriately observed as a continuous process as this assists the particular organization to recognize the objectives that it aims to attain. In this context, it is important to be noted that the objectives of any organization cannot remain the same throughout and needs to be changed according to the alterations in the business environment. In this period of ever changing business environment, only a proper strategic marketing plan can help an organization sustain. Strategic Marketing Planning in the Sports Sector The sport industry has started to acknowledge the worth and the need of a proper plan of strategic marketing. There have been little facts regarding the relationship that is said to exist among the performances and a proper marketing plan in relation to an organization. However, there has been conflict between numerous researchers of sports about the fact that unless enhancements are made in the actions of a strategic marketing plan, it would not be possible for the sports industry to persist to live on in an environment that is so competitive (Shoham & Kahle, 1996). The process for designing a proper strategic marketing plan with regard to the sports industry is proposed below. The steps that are included in the proposed structure are based on the studies of Shilbury & Et. Al. (1998), Kotler (1997), McDonald (1999) and Lancaster & Massingham (1996): 1. Ascertaining the mission statement of the organization 2. The corporate objectives associated with the particular organization should be laid down 3. Analyzing the environment of the market To evaluate the external market environment where the organization competes that is the outside forces and the competitive market among others To evaluate the inner environment of the organization that is the financial capabilities of the particular organization, marketing, and manufacturing among others 4. Performing a SWOT analysis where the strengths along with the weaknesses of the organization will be equated with the opportunities as well as the threats created by the environment outside 5. The objectives of marketing require to be laid down 6. Ascertaining the strategy of marketing with the assistance of the fundamentals of the marketing mix that is the price, product, place and promotion mix 7. To prepare a meticulous action plan, this would involve decisions regarding the schedule, human resources, activities and financial plan 8. The assessment as well as management of the plan The above proposed process would be accomplished in two different stages namely the corporate stage and the stage of marketing-operations. Process for Designing a Strategic Plan Corporate Mission The corporate mission statement is an apparent pronouncement of the things that the organization wants to carry out and the kind of organization that the firm looks forward to become. Essentially, it can be said that the statement of mission explains the activities carried out by that particular sports organization with respect to the products, the type of technology utilized and the markets (Kriemadis & Terzoudis, 2007). Corporate Objectives According to McDonald (2002), the objectives of a corporate has been explained as a wished for goal or outcome. It refers to the bigger aim that the organization desires to attain. As stated by Shilbury & Et. Al. (1998), the objectives of a sport organization needs to be SMART that is, specific or precise, measurable, attainable, realistic or reasonable and should be time bound. The corporate objectives with regard to a sport organization might involve awareness of the brand, the feature and excellence of the sport products, return expected from the investment made, and financial feasibility among others. Analysis of the Market Environment The reason behind analyzing the environment is to investigate about the situations and circumstances that prevail in the internal as well as the external environment in relation to a sports organization. It helps in finding out the factors which manipulate the functions of the organization in a positive as well as in a negative way. As stated by Kotler (1997), the market surroundings’ analysis is conducted in two different levels and includes the external surroundings evaluation and the evaluation of the internal environment. External Environment Analysis At this level, the most significant external powers of the macro-environment are evaluated and they are the technological, social, economic and political. This is commonly referred to as the PEST analysis. Furthermore, the chief features of the macro-environment should also be investigated such as the competitors, the markets and the customers as well. This analysis is conducted so as to learn about the most noteworthy opportunities and also the threats that are witnessed by the organization. Taking these factors into account, the marketing plans need to be designed. The factors to be scrutinized during the external environment analysis of the sports organization are represented below: 1. Environmental Factors Economic Movements of the economy across the world. Economic growth, distribution related to income, levels in relation to income, credit policies, instability, and inflation. Political or Legal Legislation and regulatory restrictions in relation to the sports organization (quality of the products, labeling, packaging, and pricing) Socio–cultural Religion, education, family tendencies (family attitudes and size) Alterations in approach towards lifestyles, changes in the quantity of spare time Alterations in the distribution of population and dynamics (distribution age, and local distribution) Technological Technology in relation to the production process that is capable of having an effect on the finances of the industry (new technology, saving costs, equipments, methods, and machinery) 2. The Market The complete market Growth, size and tendencies (quantity and worth) Customer investigation Demographic features (age, education, sex, and residential address) Psychographic features (views, interests, approaches of the customers) Elements that create an impact on the consumers purchsing behaviour (requirements, inspiration, outlooks, faith, approaches, and personality) Investigating with the assistance of questionnaires for: Complaints regarding the products or services offered by the organisations Customer satisfaction The demand 3. Competition Competitors Identifying the competitors in the sports sector and of the organisation Recognising the intensity of the competition Identifying the competitors strengths as well as the weaknesses The present and upcoming strategies of the competitors The probable responses of the competitors Identifying the emerging competitors Source: (Kriemadis & Terzoudis, 2007). Internal Analysis aims at assessing the resources of the particular organization such as the structure of the organization, administration system, and infrastructure among others. These help in ascertaining the strengths as well as the weaknesses of the organization. The internal abilities of the organization that assists in developing a competitive benefit in comparison to the other competitors are referred as strengths. Weaknesses are described to be the internal conditions and limitations that have probabilities of preventing the organization from attaining its aimed objectives. The factors to be included while conducting an internal analysis are represented below: Source: (Kriemadis & Terzoudis, 2007). SWOT Analysis The next move would be to shift from the analysis stage, where the main factors have been already recognized, anticipated and evaluated and utilize them for designing the strategies for marketing that would be effectual. To attain this, a SWOT analysis should be performed. This analysis helps in identifying the strengths along with the weaknesses of the organization with regard to its other competitors. It also spots the threats as well as the opportunities that originate from the exterior environment. Marketing Objectives The next level would be to lay down the purposes of marketing. Ascertaining the objectives and strategies of marketing are the main levels in the complete process. As stated by McDonald (2002) that the objects of marketing is the expression in terms of quantity of what the organization means to sell and also to whom. It was recommended by McDonald (1999) that the introduction of Ansoff matrix can assist in describing the objectives of marketing for any organization. This structure suggests two dimensions and they are the products and the markets. The matrix also recognizes the four probable groups of the objectives of marketing that the sports organization can lay down. They are: 1. To sell the present products in the present market (market penetration). 2. To expand and introduce the line of existing products in fresh markets (market extension). 3. Innovating products for the present market (product development). 4. To design fresh products for the fresh markets (diversification). Marketing Strategies After ascertaining the objectives of marketing, the way for attaining those should be determined. This implies that the strategy for marketing should be meticulously developed. Marketing strategy involves designing the marketing mix for the products, deciding the target market where the products would be sold and positioning the product in that particular market. Marketing mix is referred as a tool set that an organization utilizes so as to attain the objectives in the aimed market (Kotler & Armstrong, 1991). The tools of marketing mix have been graded into four sets by McCarthy (1996) and they are: Product is fundamentally involved with the process of building the correct product or the correct service taking into account the aimed market Price is usually involved with the procedure of making certain that the offered product or the service is delivered at a cost which would make the complete mix as appealing as possible to its customers and gives security regarding a future profit Place is involved with making certain the availability of the product or the desired service to the aimed market Promotion is involved with the numerous methods that are associated with the promotion of the product in the aimed market regarding the existence and advantages The chief rudiments of the marketing mix for a sport organization are shown below: Source: (Kriemadis & Terzoudis, 2007). Target Market Selection & Product Positioning The customer is the focal point while structuring a marketing strategy. A precondition to the structure of the other part of the strategy of marketing is requirement of the aimed markets that the organization plans to serve. Marketers chiefly keep moving from catering to mass markets that are quite huge to smaller sections with the help of marketing curriculum that are custom made. This concept of marketing is gaining importance as it is being proposed that movements of marketing should be custom made according to individuals. Previously, lack of production capacity and restricted information regarding the different requirements of the consumers, posed as a big constraint in the course of designing custom made curriculum according to individuals. But presently, new and innovative technologies facilitate firms to implement marketing that is customized on a basis that is cost-effective in numerous situations (Pine, 1993). The two major questions that arise in this respect are that which prospective purchasers need to be aimed by the particular firm to be served. To find an answer to this, it is necessary for a firm to first ascertain the most suitable method to explain and distinguish customers. This is known to be the procedure of segmentation. The second question that arises is the amount or extent of customization that the firm or organization requires to be proposed in the program. This implies the viewpoint from which does the firm need to design its plans. For instance, the mass market, the market niches, market segments or from the individuals viewpoint the plan should be designed (Scribd, 2000). It is necessary for an organization to segment the market focusing on the objectives of the plan set by the organization. Based on the objectives the segmentation should either be made on the basis of demography or geography or that of lifestyle. The demographic segmentation means to segment the market on the criteria of age, gender, occupation and income. Geographic segmentation implies on the basis of nation, urban vs. rural, region of the country. And, lifestyle means on the decisive factor of value oriented vs. self-indulgent. These are considered as the bases as this portrays the manners of an individual customer or association to a specific product (Scribd, 2000). The procedure of choosing the segments that are intended to be served is grave as eventually it is the customers who possess the authority to direct the rules through which the marketing is to be done. In this context, a firm needs to choose the targeted market by taking into consideration the relative strengths and the weaknesses of the firm in comparison to the competition. The firm should also ensure that the corporate goals equate and accommodate well with the aimed segment. The firm should also consider and analyze the resources that would be essential in order to successfully market and cater to the aimed segment. The requirement and accessibility of suitable associates with whose assistance the marketing would be done. And, finally, the most important factor that requires to be evaluated is the probable financial returns that are expected from that particular segment (Scribd, 2000). Along with the segmentation, the organization needs to decide on their positioning criterion which is to identify the position which the firm would want to capture in the minds of the aimed customers. In few instances, the strategy regarding the positioning is not possible to be adequately captured well by just emphasizing on an individual claim so, an open statement regarding the idea of positioning is considered to be significant. Therefore, the issue positioning strategy can best be worked out by deciding on the marketing mix of the product (Scribd, 2000). Action Plans Action plans are designed so as to attain the mentioned strategy for marketing. The action plan is generally designed for tenure of one year and explains quantitatively, timely and qualitatively the objectives and goals that needs to be attained along with the ways, along with the activities and resources and the names of the personnel who would be responsible for conducting all the activities. The action would help a particular company decide that quantity to be produced, the way the operations are required to be carried out, the allocation of work to the respective personnel in order to implement the strategies and carry it out. All these would take place after properly evaluating all the required factors and after designing the strategies. Reviewing and Controlling the Plan The constant monitoring and managing of the strategic marketing plan is quite a crucial process as it helps in determining of the attainment of the preset objectives. The managing process of the strategic marketing plan involves setting of standards which implies the objectives that are to be put into practice, stating and gaining the data regarding the feedback, assessment of the collected data and finally adapting remedial actions (Boyd & Walker, 1990). There are four stages involved in the process of assessment of the strategic marketing plan and they are: To manage the annual plan: The reason for this control is to make certain that the objectives are attained by the organizations that are stated in the plan Managing the profitability: It gauges the profitability aspect of the different products as well as the services that are offered by a sport organization, market segments, groups of the customer, and channels of trade among others. If any kind of difference is found by the organization regarding the objectives then remedial actions are adapted Managing efficiency: It lays emphasis on searching for ways in order to raise the level of effectiveness of the elements considered in the marketing mix such as advertising, distribution, sponsorship and publicity Strategic control: It lays stress on the fact of periodical re-evaluation of the organization and its strategic advance towards the marketplace Conclusion From the above discussion the role and importance of a strategic marketing plan is quite clear. A proper strategic marketing plan helps to provide an understanding of the competitors, trends as well as the customers with regard to the outside environment. It also provides an in-depth understanding of the internal abilities of the company which can be transformed into significant strategies of marketing with the assistance of meticulous curriculums of marketing to facilitate their implementation. From the above plan, it can be recognized that a strategic marketing plan proves quite advantageous to the organizations that implements the complete process. There have been many studies regarding the importance of the plan and it has been observed from these studies that an efficient strategic marketing plan is directly associated with the performance of the business and also the financial achievement of the organization. A strategic marketing plan is immensely important as the environment of the business is undergoing a constant change owing to which the consumers’ choice and liking are also undergoing through a phase of change. Therefore, it becomes necessary for organizations to adopt and cater according to the altering needs of the consumers or else it becomes difficult for the organizations to sustain in this competitive environment. A strategic marketing plan helps a particular organization understand about the internal as well as the external environment in which the organization functions. A meticulous understanding of the elements of the environment assists the organizations to build its own competitive advantage that ensures the survival as well as the success of the organization. In this study the process for structuring a proper and efficient strategic marketing plan has been suggested through which a 100% growth can be realized. The organizations related to the sports sector should pursue the complete process so as to manage the complex environment of business and also to become accustomed successfully to it which would facilitate to produce high economic advantages. References Boyd, H. W. & Walker, O. C., 1990. Marketing Management: A Strategic Approach. Irwin. Drucker, P., 1954. The Practice of Management. Harper. Kotler, P., 1997. Marketing Management: Analysis, Planning, Implementation and Control. Prentice Hall. Kotler, P. & Armstrong, G., 1991. Principles of Marketing. Prentice-Hall. Kriemadis, T & Terzoudis, C., 2007. Strategic Marketing Planning in the Sport Sector. Sport Management International Journal, pp. 28-45. Lancaster, G. & Massingham, L., 1996. Strategic Marketing Planning and Evaluation. Kogan Page. McCarthy, E. J., 1996. Basic Marketing: A Managerial Approach. Richard Irwin. McDonald, M. H. B., 1999. Marketing Plans: How To Prepare Them; How To Use Them. Butterworth–Heinemann. McDonald, M. H. B., 2002. Marketing Plans: How to Prepare them; How to Use Them. Prentice Hall. Nilsson, F. & Rapp, B., 2005. Understanding Competitive Advantage: The Importance of Strategic Congruence and Integrated Control. Springer. Pine, B. J., 1993. Mass Customization: The New Frontier in Business Competition. Harvard Business Press. Scribd, 2000. Note on Marketing Strategy. Harvard Business School. [Online] Available at: http://www.scribd.com/doc/61861524/Note-of-Mkting-Strategy-Free [Accessed Aug 27, 2011]. Shilbury, D. & Et. Al., 1998. Strategic Sport Marketing. Allen and Unwin. Shoham, A. & Kahle, L.R., 1996. Spectators, Viewers, Readers: Communication And Consumption In Sport Marketing. Sport Marketing Quarterly p.p. 11-19. Bibliography Shank, M. D., 1999. Sports Marketing: A Strategic Perspective. Prentice-Hall. Read More