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Strategic Marketing Plan

Introduction

Every company designs strategic plans to achieve their set objectives and goals. These plans can be short, medium, or long-term, according to the size and scope of the company.

It is very important that the company specifies accurately and carefully its mission. The mission is fundamental since it represents the operative functions that the company is going to perform in the market and supply to the consumers.

For a company, it is very important to define its mission, and if they are carefully devised they are a source of success for the company. Revised missions have turned the destiny of many companies.

In the following report, a Strategic Marketing Plan for the Corporate International Department of the Raiffeisenlandesbank Steiermark Bank is introduced. The first part introduces the theoretical description to take into account for its development. The second part is basically a departmental analysis, to then set the objectives and goals on the base of the needs of the Market and the results from the last 12 months, together with the application of this Strategic Marketing Plan.

Strategic Planning is a management system that moves the focus from “what to achieve” (objectives) to “what to do” (strategies). With Strategic Planning the aim is to focus on those objectives that are possible to achieve and in what business or area to compete, in correspondence with the opportunities and threats that the environment offers.

The essence of strategic planning is the systematic identification of the opportunities and threats that will arise in the future, which, combined with other important data, supply the base for a company to make better decisions in the present to exploit opportunities and avoid dangers.

Sallenave (1991) states that “Strategic Planning is the process by which managers order their objectives and their actions in time. It is not a domain of top management, but a communication and decision making process in which all the strategic levels of the company take part”. The aim of Strategic Planning is to produce deep changes in the organisation’s market and in its internal culture.

Strategic planning demands four, well-defined stages: mission statement and organisational objectives, analysis of company strengths and weaknesses, environment analysis, and strategy statement.

Values, Mission, Vision, Objectives

To correctly define Strategic Planning, it is necessary to consider four different points of view, each of which are necessary for its understanding:

THE FUTURE OF CURRENT DECISIONS: First, planning deals with the future of current decisions. This means that Strategic Planning observes the chain of consequences of causes and effects for some time, related with a real or intended decision that the Management will make. Strategic Planning also observes possible alternatives of future courses of action, and by choosing the alternatives, they turn into the base for making current decisions. The essence of Strategic Planning is the systematic identification of the opportunities and threats that will arise in the future, which, combined with other important data, supply the base for a company to make better decisions in the present to exploit opportunities and avoid dangers. Planning means to design a desired future and to identify the ways to make it.

PROCESS: Second, Strategic Planning is a process that starts with setting organisational goals, it defines strategies and policies to achieve those goals, and it develops detailed plans to ensure the implantation of the strategies, thus reaching the desired aims. It is also a process to decide beforehand what kind of planning efforts shall be made, when, and how they shall be done, who will do them, and what will be done with the results. Strategic Planning is systematic in the sense that it is organised and conducted based on understood reality.

For most of the companies, Strategic Planning represents a series of plans produced after a specific period of time, during which other plans are devised. It should also be understood as a continuous process, especially regarding the formulation of strategies, since changes in the business environment are continuous. The idea is not that plans shall be changed every day, but planning shall be performed continuously and be backed up by the appropriate actions when necessary.

PHILOSOPHY: Third, Strategic Planning is an attitude, a way of life; it requires dedication to act based on the observation of the future, and a determination to plan constantly and systematically as an integral part of Management. Besides, it represents a mental process, an intellectual exercise, more than a series of prescribed processes, procedures, structures, or techniques. To achieve the best results, the organisation’s managers and staff have to believe in the value of strategic planning and they should try to perform their activities as best as possible. Ackoff says: “Not doing it right is not a sin, but not doing it as best as possible is”.

STRUCTURE: Fourth, a formal Strategic Planning system joins four types of fundamental plans, which are: strategic plans, medium term programs, short term budgets, and operative plans. In a company with decentralised divisions there can be this kind of combination between each division plan, and a different combination between strategic plans made in general offices, and division plans. By means of these combinations, top management strategies are reflected in current decisions. The concept of a plan structure is also stated in the following definition: “Strategic Planning is the systematic and more or less formal effort of a company to establish its basic purposes, objectives, policies and strategies to develop detailed plans to put into action its policies and strategies and thus achieving basic company objectives and purposes”.

These four fundamental characteristics serve as a basis for the development of conceptual and operative definitions.

What is a Strategic Marketing Plan?

A Marketing Plan is a management tool that determines which steps to follow, and the methodologies and times to reach certain objectives. Thus, a Marketing Plan is part of the Strategic Planning of a company.

We cannot forget that it should not be an isolated activity; on the other hand, it has to be perfectly linked to the rest of the company departments (Finance, Production, Quality, Personnel, etc.).

A marketing plan is a tool that allows us to set a path to arrive to a concrete place. It will be very difficult to devise if we do not know where we are and where do we want to go. Hence, this is the starting point.

We have to ask ourselves:

Where is the company at right now?

Where are we going?

Where do we want to go?

We should take into account: Where is the company? Where is it going if the internal and external situation does not change? Where do we want to go? How do we get there?

Company Aims

“Customer service is the responsibility

of each and every one of the

members of the work team”.

Traditional marketing has reached its upper limit. To be corporate and marketing-successful we need to create clear advantages for our customers. To know who really our competitors are and where are they going to be in two years from now. To surprise customers by doing things competitors do not do, to make the customer happy. We have to attract and keep (by creating customer loyalty) customers; we have to set our company values, the objectives and our vision of the future (Philip Kotler).

The premise “In our company the customer is the most important element” should be the cornerstone of every company, but for many Latin American companies it is only an out-of-fashion cliché. Unfortunately, even in times when companies should act more proactively in their dealing with customers, many of them act as if they are doing them a great favour by letting them purchase their products. However, market globalisation, e-commerce and high competitiveness are making this kind of companies quickly disappear.

The truth is that the best companies in the world have been founded over this premise: customer service is their biggest obsession. Those who are in the vanguard in their field of action are those to which customer satisfaction is their most important driving force.

After more than a decade of working with executives and professionals, I have arrived to the conclusion that the goal of any company is but one: “To create and to keep customers”. Many executives mistakenly think that the aim of a new company is to generate profits, to sell more than their competitors or to be the leaders in their sector. The truth is that profits, sales, market positioning and utilities are simply a measure, a thermometer of to what extent the company is complying to their true purpose of attracting and keeping customers.

Utility level is representative of how well the people that are part of the company are working in complying with such purposes. If the utilities are far from being what you expected, then you must take some time to examine all the aspects that in one way or another influence the attraction and keeping of new customers, like product quality and price, marketing techniques and sales, and above all, customer service. We should take into account the following: in any business, first we should know what do the customers want and need, then design the products and services they want, to later produce them efficiently and effectively (achieving cost, quality and delivery). Then we should have the capacity to sell them, and if necessary finance them, to finally charge them. If all the previous steps are carried out correctly, but there are collecting problems, i.e. cash flow, the whole company will go deeply into trouble. For a company it is not enough to be profitable, it also needs financial solvency. This implies that even Strategic Marketing is fundamental for the company, it is not enough for a company to be profitable. The companies with better service levels possess higher profitability levels, as long as the other business factors are correctly managed.

Remember that it is the people that are in charge of providing customer satisfaction, not the machines, or papers, or strategies, or offices; it is the managers, advisors and sales representatives. Customer service is the responsibility of each and every one of the members of the work team. As executives we must make sure that this is clearly understood in our companies. It is also very important to understand that it is going to be impossible for an unmotivated person, or with a poor attitude, to render a great service. By investing in the motivation of your collaborators, you will be investing in your customers’ service.

How to Create a Strategic Marketing Plan

Based on the concepts learnt from the Strategy and Marketing Lecturers during the MBA Course, the following steps to take into account for the creation of a Strategic Marketing Plan can be defined.

  1. 1. What is a Strategic Marketing Plan?
    2. How can I develop a Marketing Plan?
    3. How can I control the implantation and development of a Marketing Plan?
  2. Introduction
  3. Objectives
  1. To know the most important aspects of the Marketing Plan.
  2. To know the different sections a Marketing Plan is composed of.
  3. To identify the control systems of the Marketing Plan.
  1. Sections

1. Introduction.

2. Forecast and Objectives.

3. Stages of the Marketing Plan.

4. Difficulties.

5. Summary.

  1. Introduction

A Marketing Plan is a management tool that determines which steps to follow, the methodologies and times to reach certain objectives. Thus, a Marketing Plan is part of the Strategic Planning of a company.

We cannot forget that it should not be an isolated activity; on the other hand, it has to be perfectly linked to the rest of the company departments (Finance, Production, Quality, Personnel, etc.).

2. Forecast and Objectives

2.1 Forecast

We can say this section is already a part of the Marketing Plan. It consists in answering the following question: If our market and environment tendency stays the same and continues, what will be our situation in the short, medium, and long term?

We have to ask ourselves:

  • Where is the company at right now?
  • Where are we going?
  • Where do we want to go?

A marketing plan is a tool that allows us to set a path to get to a concrete place. It will be very difficult to devise if we do not know where we are and where do we want to go. Hence, this is the starting point.

2.2 Objectives

Because of the previous analysis, it is convenient to set the goals we pretend to achieve with the available media.

The objectives should:

  • Be measurable qualitatively and quantitatively.
  • Be reachable.
  • Count on the adequate means.
  • Be perfectly described.
  • Be accepted by the people involved.

3. Stages of the Marketing Plan

The Marketing Plan demands a methodology to be followed with certain precision if we do not want to fall into chaos. It is important to follow each and every one of the following stages in the order they are mentioned.

3.1 Analysis of the situation

In this section we should identify:

  • The existing competitors.
  • SWOT (Strengths, Weaknesses, Opportunities, and Threats).
  • Products, prices, discounts, location, invoicing, design, manufacturing, finances, etc. of every one of them.
  • Sales policy, distribution channels used, publicity and promotion.
  • Environmental, market, economical, political, legal, technological etc. situation.
  • Consumer behaviour, product use patterns, sector, industry or market customs.
  • Market tendency and possible evolution.
  • Situation of our company as regards product, finances, productive capacity, research and development technology, costs, personnel, media policies.
  • Who are our customers?
  • Why do they buy?
  • When do they buy?
  • Where do they buy?
  • How do they buy?
  • How much do they buy?
  • How often do they buy?
  1. Forecast

What kind of forecast methods shall be used? Forecasts are considered of great importance for operation management as well as by sales administration and marketing management.

3.3 Objectives

  • General Marketing Plan objectives.
  • Sale objectives per product.
  • Market share objectives.
  • Brand share objectives.
  • Quality objectives.
  • Time objectives.
  • Price objectives.
  • Margin and cost objectives.
  • Publicity and promotion objectives.
  • Target determination.
  • Sales share per salesman, delegation, and team.

3.4 Strategy

The following should be duly taken into account: first, what the company shall focus on, second, where does the company pretend to position itself, and third, the kind of war marketing to use (frontal, defensive, lateral, guerrilla attack). The Life Cycle of different products or services we are exploiting or have the intention to exploit shall also be taken into account. Another important aspect is if goods with a “push” or “pull” approach are going to be produced (JIT). When dealing with banking services this distinction does not apply.

We understand by strategy a way to reach certain objectives. Or, what are we going to do to reach our goals?

The term strategy comes from military language. Charles O. Rossoti says that strategy is “The engine that increases the organisation’s flexibility to adapt to change and the capacity to reach new and creative opinions”. Strategy is a creative task.

The following 4 sections should be explained in detail:

Product Policies

  • Which product do we wish to commercialise?
  • Product characteristics.
  • Package design.
  • Brands.
  • Labels.
  • Target.
  • Quality.
  • Presentations.

Price Policies

  • Fees.
  • Sale conditions.
  • Discounts.
  • Margins.
  • Balance point.

Distribution Policies

  • Physical distribution of merchandise.
  • Distribution channels to use.
  • Sales network organisation.

Publicity and promotion policies.

  • Promotions.
  • Merchandising.
  • Media plan.
  • Development of advertising campaign.
  • Advertisement efficiency analysis.

3.5 Tactics to Use

A tactic is a strategy of a lower order. Actions to achieve smaller objectives in smaller periods of time. They are more specific tasks, and not as global as strategies would be.

  • What should each person do specifically?
  • When should they do it?
  • How should they do it?
  • Who should do it?
  • What are the resources available?
  • Work and task planning.
  • Technical, economical, and human resources.
  • Organisation.

3.6 Controls to use

Control procedures shall be established to assess the efficiency of every action, as well as assess if programmed tasks are performed in the way, method and time expected.

There are three types of control:

  • Preventive: They are those controls that we set beforehand as possible causes for mistake or delay. They allow having a set corrective action if it is the case.
  • Corrective: They are performed once the problem has occurred.
  • Late: When it is too late to correct.

That is why it is better to establish preventive controls for each of the proposed tasks.

3.7 Feedback

As we implant the Marketing Plan it could be the case that some initial conditions change. For example, a reaction from the competition, new products entering the market, etc. This means correcting the Marketing Plan as convenient.

The Marketing Plan should not be rigid and fixed. On the other hand, some flexibility in its application should be shown.

It is important to establish a contingency plan for every possible new situation.

3.8 Finance Planning

The objective of this section is based on the need of planning the costs and budgets related to the Marketing Plan.

It is necessary to prevent beforehand each and every one of the costs, as well as the different budgets we shall assign to every department.

  • Publicity and promotion costs.
  • Sales costs and profits.
  • Research costs.
  • Product development costs.
  • Logistics and distribution costs.
  • Margins and balance point.
  • Determining a budget for every department/area.

4. Difficulties

There are some difficulties that we cannot forget as regards implantation of the Marketing Plan. We might as well identify them to prevent them.The most widely known are the following:

  • Badly defined or disproportionate objectives.
  • Lack of technical, human or financial means.
  • Not foreseeing possible competitor action.
  • Not having alternative plans.
  • Poor planning as regards action execution.
  • Lack of implication on behalf of the Direction.
  • Not setting adequate controls.
  • Poorly motivated or trained personnel.
  • Inadequate target.
  • Lack of anticipation as regards contingency plans.
  • Poor market information.
  • Inaccurate information analysis.
  • Excess of information and unnecessary bureaucratic formalities.
  • Lack of coordination between different company departments.

5. Summary

What Strategic Planning Is Not

Strategic Planning is not about making future decisions, since decisions can only be made in the present. Future planning demands choosing between possible future events, but decisions themselves, which are made based on these events, can only be made in the present. Of course, once taken, they can have irrevocable consequences in the long term.

Strategic planning does not foresee product sales to then determine what measures to take to ensure the realisation of a certain forecast related to factors such as: material purchase, facilities, work force, etc. Strategic Planning goes beyond current product forecasts and current markets, and asks a lot more fundamental questions such as: Do we have the right business? Which are our basic objectives? When will our current products be obsolete? Are our markets increasing or decreasing in size? For most companies there is a gap between an objective forecast of current sales and utilities and the wishes of top management as regards those issues. This gap can be eliminated by means of Strategic Planning.

Strategic Planning does not represent a programming of the future, neither the development of a series of plans that can serve as a pattern to use every day without changing them in the far future. A great part of the companies revise their strategic plans periodically, generally once a year. Strategic Planning has to be flexible to take advantage of the knowledge about the environment.

In fact, it does not consist in the preparation of several detailed and interrelated plans, although in some big and decentralised companies it does. The basic conceptual nature of Strategic Planning encompasses a large variety of planning systems, from the most simple to the most complex.

Strategic Planning does not represent an effort to substitute the Management intuition and criteria, an aspect that should be highlighted.

Strategic Planning is not only a group of functional plans or an extrapolation of current budgets; it is an approach of systems to lead a company through its environment for a while, to achieve the desired goals.

My Performance During the Past 12 Months and my Influence on Strategic Roles

I am currently working at the Department of Foreign Relations and International Trade at the Raiffeisen Cooperative Bank. I started working in the Documentation Department (where all the operative activities regarding letters of credit, international warranties, and exports advisory to customers are developed).

With time, by exposing my ideas to the Bank’s Board of Directors, I was able to participate in new, innovative ideas for the “change and continuous improvement of the Foreign Department”.

The situation of the Bank at the beginning of my work was that each department worked independently from the others. Even if the Foreign Department deals with international negotiations of corporate customers, we did not work together with the Commercial Advisors, neither with the Cultural Department, nor the Marketing Department.

According to what I learnt during the course of my MBA in Strategy, Cross Cultural Management, Sales Management, and Marketing management, I could see the importance of the interrelation between different departments and sciences. That is, one is backed up by the other, and in corporate strategy, it is very important to interrelate them all.

As a result from my meeting with the Management and according to the topic I was to write about in my Master’s Thesis, it all led me to work in the “organisation of a strategic project for the Foreign Department”.

The idea started to take shape by analysing the current situation of the Bank, and its commercial and organisational strategy. We cannot at this point change completely its strategy, but we can apply a “continuous improvement” strategy in Globalisation times.

According to what was said in the first part of this work on the “Strategic Marketing Plan” and “Strategy”, and taking into account all the steps to follow, and what really strategy is, the following items were taken into account:

The Bank’s Vision is to take into account “customer service quality, especially in the commercial segment (A, B and C)”. A vision of quality and of qualitative customer service, in the long term.

The set objectives are varied, but the most important are through qualitative service, keeping current customers/members, as well as seeking new long-term potential customers.

This can be reached and carried out taking into account the application of a “Strategy and optimum Strategic Marketing Plan”.

That is why I considered the importance of working with different departments as a team, a concept learnt from the Leadership course.

My first proposal was to work with the following departments together:

  • International Department (together with the Chambers of Commerce)
  • Commercial Department (Advisors and Credit Department)
  • Marketing Department
  • Cultural Department

The idea was to meet with the four departments and discuss the topics of implementing a group Strategy and to clearly define its objectives.

This plan was put into practice, and since 7 months ago, having my proposal being accepted by the Board of Directors, the “Subleaders” of the different sub-departments and the main “Leaders” are meeting every 15 days and discussing all our proposals, reporting all the advances and changes in each department, and controlling the set objectives.

The proposal itself has been the following applied Strategy:

  • Bimonthly meetings between Leaders and Subleaders
  • Training of personnel in the different areas mentioned (e.g. Customer Advisors have received training on Foreign Department tasks, and Marketing and Cross Cultural Management knowledge)
  • The Marketing Department now works together with the other departments by doing a previous market research and talking with Customer Advisors on how to completely satisfy customer needs
  • Working together with the Cultural department, organising cultural and informative events for customers telling them about new products, Bank innovations, and current issues related to financial and international Economics.

As a future objective there is the creation of a Latin American Chamber where our investors and Customers can be advised on Alca, Mercosur and NaftaEconomy. Another service for our customers.

As a moral learnt from the past 12 months:

In any Strategic Plan it is important to analyse the way in which the bank is affected or compromised by the power of negotiation of customers and suppliers, substitute competitors (a lot of companies like GE, GM, Sears, amongst many others, compete with banks as regards credits and in providing services like credit cards), possible entry of new competitors in the market (as a result of EEC Globalisation), capacity of current competitors, level of fixed costs, growing importance of technology (ATMs, handling accounts from the customer’s office, amongst many others), flexibility of the Bank when adapting to new demands, and also strategic plans as regards staff training.

We have to analyse the company’s (i.e. the Bank’s) competitive advantages, as well as taking into account the different strategies to apply, e.g. vertical integration (backward or forward); horizontal integration, take-over, product development, market development, market penetration, diversification (new services in new markets), etc. Of equal importance is to analyse in what stage of their life cycle each product or service offered by the bank is at (which is the matrix of different banking groups), and in that way applying a policy according to different types of services. Besides, depending on each cycle stage different actions correspond as regards service redesign, publicity, service price, etc.

Even if there is no unique formula, any Strategic Marketing Plan should be further enriched by including a thorough analysis based on the previous points.