FFIRS 11 July 2011; 16:50:31 Marketing Plans for Services FFIRS 11 July 2011; 16:50:31 FFIRS 11 July 2011; 16:50:31 Marketing Plans for Services A Complete Guide Third Edition Malcolm McDonald, Pennie Frow and Adrian Payne A John Wiley & Sons, Ltd, Publication FFIRS 11 July 2011; 16:50:31 This edition first published in 2011 Copyright # 2011 Malcolm McDonald, Pennie Frow and Adrian Payne Registered office John Wiley & Sons Ltd, The Atrium, Southern Gate, Chichester, West Sussex, PO19 8SQ, United Kingdom For details of our global editorial offices, for customer services and for information about how to apply for permission to reuse the copyright material in this book please see our website at www.wiley.com The right of the author to be identified as the author of this work has been asserted in accordance with the Copyright, Designs and Patents Act 1988 All rights reserved No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, except as permitted by the UK Copyright, Designs and Patents Act 1988, without the prior permission of the publisher Wiley also publishes its books in a variety of electronic formats Some content that appears in print may not be available in electronic books Designations used by companies to distinguish their products are often claimed as trademarks All brand names and product names used in this book are trade names, service marks, trademarks or registered trademarks of their respective owners The publisher is not associated with any product or vendor mentioned in this book This publication is designed to provide accurate and authoritative information in regard to the subject matter covered It is sold on the understanding that the publisher is not engaged in rendering professional services If professional advice or other expert assistance is required, the services of a competent professional should be sought Library of Congress Cataloging-in-Publication Data McDonald, Malcolm Marketing plans for service businesses : a complete guide / Malcolm McDonald, Pennie Frow and Adrian Payne — 3rd ed p cm Includes bibliographical references and index ISBN 978-0-470-97909-9 (pbk : alk paper) Service industries—Marketing Service industries—Planning I Payne, Adrian II Frow, Pennie III Title HD9980.5.M388 2011 2011017544 658.80 02—dc23 ISBN 978-0-470-97909-9 (paperback), ISBN 978-1-119-95186-5 (ebk), ISBN 978-0-470-97941-9 (ebk), ISBN 978-0-470-97944-0 (ebk) A catalogue record for this book is available from the British Library Typeset in 10/12pt Palatino Roman by MPS Limited, a Macmillan Company, Chennai, India Printed in Great Britain by TJ International Ltd, Padstow, Cornwall, UK FFIRS 11 July 2011; 16:50:31 Contents Preface The structure of this book and how to use it List of figures vii ix xi Marketing and services The nature of services marketing 23 Marketing planning for services: the process Marketing planning for services: the problems 49 63 Marketing planning Phase One: the strategic context 79 Marketing planning Phase Two: the situation review (Part 1) Marketing planning Phase Two: the situation review (Part 2) 10 11 12 13 Marketing planning Phase Three: marketing strategy formulation Marketing planning Phase Four: resource allocation, monitoring and detailed planning (Part 1: the budget, the service product plan and the communications plan) Marketing planning Phase Four: resource allocation, monitoring and detailed planning (Part 2: price, place, people, processes and customer service) Organizing for marketing planning Measuring the effectiveness of marketing plans for service businesses A step-by-step marketing planning system for service businesses Examples of marketing plans Glossary of marketing planning terms References Index 107 141 183 213 267 307 347 373 411 469 477 485 FTOC 11 July 2011; 11:22:43 FTOC 11 July 2011; 11:22:43 Preface This latest edition recognizes the growing importance of the service sector in most economies and of significant differences between product and service marketing The world of services marketing has changed dramatically during the past decade The easy, high-growth markets have been replaced by mature, low-growth demand patterns that have forced suppliers to question their erstwhile successful business models, such as, for example, those that consisted largely of making ‘products’ and selling them to intermediaries, who magically got rid of them somehow to an unsophisticated general public who were in awe (or ignorance) of complicated products such as pensions Today, however, there is in most developed countries a situation of government regulation, oversupply, and more importantly a more sophisticated consumer who has been empowered by the Internet This has forced service providers to pay greater attention to the needs of the consumers of their services This means that they have been forced to pay greater attention to marketing The three authors work with many of the world’s leading service organizations in their role as professors of marketing at three of the world’s leading business schools We have sought to combine the acknowledged leadership of Cranfield University in the domain of marketing planning (Malcolm McDonald) with the experience of two experts in the field of services marketing (Pennie Frow and Adrian Payne) to produce a unique text for those who are faced with the special challenge of producing world-class marketing plans for services where there are no tangible products The approaches outlined in this book have been used extensively by us in a large number of services organizations We believe you will find, in the pages of this book, the answer to the challenge of creating marketing plans that produce significantly improved bottom-line results Malcolm McDonald Pennie Frow Adrian Payne September 2011 FPREF 11 July 2011; 11:20:13 FPREF 11 July 2011; 11:20:13 References 481 Rigby, D.K., Reicheld, F.F., Schefter, P (2002) ‘Avoid the Four Perils of CRM’, Harvard Business Review, 80 (2), 101–109 10 Christensen C., Cook, S and Hall, T (2005) ‘Marketing Malpractice: The Cause and the Cure’, Harvard Business Review, 83 (12) December, 74–83 11 Yankelovitch, D (2006) ‘Rediscovering Market Segmentation’, Harvard Business Review, 84 (6) February, 122–131 12 Smith, B (2003) ‘The Effectiveness of Marketing Strategy Making Processes in Medical Markets’, April, Cranfield Doctoral Thesis Chapter Fleisher, C and Bensoussan, B (2002) Strategic Competitive Analysis: Methods and Techniques for Analyzing Business Competition, Englewood Cliffs, NJ: Prentice Hall; Pollard, A (1999) Competitor Intelligence – Strategy, Tools and Techniques for Competitive Advantage, Pitman; Fuld, L (1994) The New Competitor Intelligence: The Complete Resource for Finding, Analyzing, and Using Information about Your Competitors, New York: John Wiley & Sons Inc Porter, M (1980) Competitive Strategy, New York: The Free Press Hamel, G and Prahalad, C.K (1994) Competing for the Future, Boston: Harvard Business School Based on Kotler, P (1991) Marketing Management, 7th edn, Englewood Cliffs, NJ: Prentice Hall, p 301 For a review of positioning research, see: Holey, G and Saunders, J (2003) Competitive Positioning, Prentice Hall, Ch 10 For a more general discussion of positioning, see: Ries, A and Trout, J (2000) Positioning: The Battle for Your Mind, 20th Anniversary Edition, New York: McGraw Hill Based on Kosnik, T (1989) Corporate Positioning: How to Assess and Build a Company’s Reputation, Boston: Harvard Business School, Note 9–589–087 Sasser, W.E., Olsen, R.P and Wyckoff, D.D (1978) Management of Service Operations: Text, Cases and Readings, London: Alleyn & Bacon, pp 534–566 Wilson, A (2002) The Marketing Audit Handbook, London: Kogan Page McDonald, M and Leppard, J (1991) The Marketing Audit, Oxford: Butterworth-Heinemann; Parmerlee, D (2000) Auditing Markets, Products and Marketing Plans, New York: McGraw Hill Chapter Cooper, R., Edgett, S and Kleinschmidt, E (2001) ‘Portfolio Management for New Product Development: Results of an Industry Practices Study’, R&D Management, 31 (4), 361–380 Porter, M.E (1980) Competitive Strategy, New York: The Free Press See Myers, K (1999) Manager’s Guide to Contingency Planning for Disasters, New York: John Wiley & Sons Inc Chapter Abratt, R., Beffon, M and Ford, J (1994) ‘Relationship Between Marketing Planning and Annual Budget’, Marketing Intelligence and Planning, 12 (1), 22–28 Vancil, R and Ferrantino, J.A (2010) Marketing Investment Planner 2011: Benchmarks, Key Performance Indicators, and CMO Priorities, IDC #225478, November 2010 Constantinides, E (2006) ‘The Marketing Mix Revisited: Towards the 21st Century Marketing’, Journal of Marketing Management, 22, 407–438 bref 11 July 2011; 10:51:55 482 References Adapted from McDonald, M and de Chernatony, L (2001) ‘Corporate Marketing and Service Brands: Moving Beyond the Fast-moving Consumer Goods Model’, European Journal of Marketing, 35 (3/4), 335–352 Thorbjørnsen, H and Supphellen, M (2011) ‘Determinants of Core Value Behavior in Service Brands’, Journal of Services Marketing, 25 (1), 68–76 Berry, L.L and Parasuraman, A (1991) Marketing Services: Competing Through Quality, New York: The Free Press, p 131 For an excellent discussion on physical evidence, see: Zeithaml, V.A., Bitner, M.J and Gremler, D.D (2009) Services Marketing: Integrating Customer Focus across the Firm, 5th edn, New York: McGraw Hill, Chapter 11 Lovelock, C., Patterson, P.G and Wirtz, J (2011) Services Marketing: An Asia-Pacific and Australian Perspective, 5th edn, Frenchs Forest, NSW: Prentice Hall, p 265 Gr€ onroos, C (2007) Service Management and Marketing, 3rd edn, Chichester: John Wiley & Sons Ltd 10 Shultz, D and Shultz, H (2003) IMC – The Next Generation: Five Steps for Delivering Value and Measuring Financial Returns, New York: McGraw Hill 11 For a detailed discussion of CRM, see: Payne, A (2006) The Handbook of CRM: Achieving Excellence in Customer Management, Oxford: Elsevier Butterworth Heinemann Also see: Frow, P and Payne, A (2009) ‘Customer Relationship Management: A Strategic Perspective’, Journal of Business Market Management, (1), 7–28 12 Spenner, P (2010) ‘Why you Need a New-Media ‘‘Ringmaster’’ ’, Harvard Business Review, December, 78–79 13 Rogers, E.M (1995) Diffusion of Innovations, 4th edn, New York: Free Press 14 Based on Johnson, E.M., Scheuing, E.E and Gaida, K.A (1986) Profitable Services Marketing, Homewood, Ill: Dow Jones-Irwin, p 212 Chapter 10 See, for example: Bahnub, B.J (2010) Activity-Based Management for Financial Institutions: Driving Bottom-Line Results, New York: John Wiley & Sons Inc Based on material from Boston Consulting Group Chambers, S and Johnston, R (2000) ‘Experience Curves in Services: Macro and Micro Level Approaches’, International Journal of Operations & Production Management, 20 (7), 842–859 See: Burger, A (2005) ‘The Son also Rises’, Pest Control, 72 (4), 116; and Heskett, J.L., Sasser, W.E and Hart, C.W.L (1990) Service Breakthroughs, New York: The Free Press, p 89 Rogers, E.M (1995) Diffusion of Innovations, 4th edn, New York: Free Press See also: Judd, V (2003) ‘Achieving a Customer Orientation Using ‘‘People Power’’, the ‘‘5th P’’ ’, European Journal of Marketing, 37 (10), October, 1–13; and Judd, V.C (1987) ‘Differentiate with the 5th P: People’, Industrial Marketing Management, 16, 241–247 (The descriptions of the four categories are based closely on his work.) See: Heskett, J.L and Sasser, W.E (2010) ‘The Service Profit Chain: From Satisfaction to Ownership’, in Maglio, P.P., Kieliszewski, C.A and Spohrer, J.C (eds), Handbook of Service Science: Research and Innovations in the Service Economy, New York: Springer, pp 19–30; Heskett, J.L., Sasser, W.E and Schlesinger, L.A (1997) The Service Profit Chain, New York: The Free Press; and Hallowell, R., Schlesinger, L.A and Zornitsky, J (1996) ‘Internal Service Quality, Customer and Job Satisfaction: Linkages and Implications’, Human Resource Planning Journal, 19 (2), 20–31 Wieseke, J., Ahearne, M., Lam, S.K and van Dick, R (2009) ‘The Role of Leaders in Internal Marketing’, Journal of Marketing, 73, March, 123–145 bref 11 July 2011; 10:51:56 References 483 See: Varey, R and Lewis, B (2000) Internal Marketing: Directions for Management, London: Routledge; and Pervaiz K.A and Rafiq, M (2002) Internal Marketing: Tools and Concepts for Customer-Focused Management, Oxford: Elsevier 10 This section is based on Stostack, G.L (2001) ‘Service Positioning through Structural Change’, in Lovelock, C., Patterson, P.G and Walker, R.H Services Marketing: An Asia-Pacific Perspective, 2nd edn, Frenchs Forest, NSW: Prentice Hall, pp 577–587 11 See: Bitner, M.J., Ostrom, A.L and Morgan, F.N (2008) ‘Service Blueprinting: A Practical Technique for Service Innovation’, California Management Review, 50 (3), 66–94; and Band, W (1989) ‘Blueprint your Organisation to Create Satisfied Customers’, Sales & Marketing in Canada, April, 6–8 The latter author refers specifically to these approaches 12 Shostack, G.L (1985) ‘Planning the Service Encounter’, in Czepiel, J.A (ed.), The Service Encounter, Lexington, Mass: Lexington Books 13 See: Lovelock, C (2000) ‘Functional Integration in Services: Understanding the Links between Marketing, Operations, and Human Resources’, in Schwartz, T.A and Iacobucci, D (eds), Handbook of Services Marketing and Management, Thousand Oaks, CA: Sage, pp 421–438; and Lovelock, C (1992) ‘Seeking Synergy in Service Operations: Seven Things Marketers Need to Know About Service Operations’, European Management Journal, 10 (1), 22–29 14 Lovelock, C., Patterson, P.G and Wirtz, J (2011) Services Marketing: An Asia-Pacific and Australian Perspective, 5th edn, Frenchs Forest, NSW: Prentice Hall, p 265 15 We are grateful to Professor Christopher of Cranfield University for his commentary on these steps 16 Shapiro, B (1985) ‘Rejuvenating the Marketing Mix’, Harvard Business Review, September–October, 28–33 Also see: Akroush, M (2006) ‘The Services Marketing Mix Paradigm: Is it Still Appropriate for Today’s Service business?’ AL-Balqa Journal for Research and Studies, 11 (2), 49–74 17 Collier, J.E and Bienstock, C.C (2006) ‘Measuring Service Quality in e-re-retailing’, Journal of Service Research, (February), 260–275 18 See Parasuraman, A., Zeithaml, V.A and Berry, L.L (1985) ‘A Conceptual Model of Services Quality and Its Implications for Future Research’, Journal of Marketing, 49, Autumn, 41–50 For an overview of the work of Berry, See: Keaveney, S (2004) ‘Reviews of Books’, Journal of the Academy of Marketing Science, 32 (2), 203–211 19 Parasuraman, A., Zeithaml, V.A and Malhotra, A (2005) ‘E-S-QUAL: A Multiple-Item Scale for Assessing Electronic Service Quality’, Journal of Service Research, (3), 213–233 20 Ambler, T (2003) Marketing and the Bottom Line, 2nd edn, London: Financial Times Prentice Hall Chapter 11 This section on MIS and database marketing is based on McDonald, M and Wilson, H (2011) Marketing Plans: How to Prepare Them; How to Use Them, 7th edn, Chichester: John Wiley & Sons Ltd EXMAR is a major decision-support tool for strategic marketing planning These software application systems are available from marcus.clark@ themarketingprocessco.com Those wishing to examine the topic of marketing research in detail should see standard texts such as: Malhotra, N (2010) Marketing Research: An Applied Orientation, Harlow, UK: Pearson; and Aaker, D.A., Kumar, V., Day, G.S and Leone, R.P (2010) Marketing Research, John Wiley & Sons, Ltd bref 11 July 2011; 10:51:56 484 References Greiner, L.E (1998) ‘Revolution is Still Inevitable’, Harvard Business Review, 3, 62–63; and Greiner, L.E (1967) ‘Patterns of Organisation Change’, Harvard Business Review, 45, 119–128 Leppard, J (1989) ‘Marketing Planning and Organisational Culture’, M Phil thesis, Cranfield University This section is based on original work by Visiting Professor Simon Majaro of Cranfield School of Management and is used with his kind permission Gottlieb, M.R (2007) The Matrix Organization Reloaded: Adventures in Team and Project Management, Westport, CT: Praeger (This book provides a managerial perspective on matrix management.) Varum, C.A (2010) ‘Directions in Scenario Planning Literature: A Review of the Past Decades’, Futures, 42 (4), 355–369; Hughes, N (2009) A Historical Overview of Strategic Scenario Planning, UK Energy Research; Worthington, W.J., Collins, J.D and Hitt, M.A (2009) ‘Beyond Risk Mitigation: Enhancing Corporate Innovation with Scenario Planning’, Business Horizons, 52 (5), September–October, 441–450 (These references provide provide more detailed background to scenario planning.) Kotler, P (2003) Marketing Management, 11th edn, Upper Saddle River, New Jersey: Prentice Hall, pp 695–797 (The marketing effectiveness audit is reproduced in full at these pages in his book.) Chapter 12 Deloitte (2007) ‘Marketing in 3D’, Deloitte and Touche, www.deloitte.co uk/marketing Wilson H (1997) ‘An Investigation into the Impact of Decision Support Systems on Strategic Marketing Planning Practice’, PhD thesis, Cranfield University School of Management Smith, B.D (2003) ‘The Effectiveness of Marketing Planning in Medical Markets’, PhD thesis, Cranfield University School of Management Davidson, H (1997) Even More Offensive Marketing, London: Penguin Books Baker, S (2000) ‘Defining a Marketing Paradigm’, Unpublished Research Report, Cranfield University School of Management Porter, M.E (1980) Competitive Strategies, New York: Free Press Rappaport, A (1986) Creating Shareholder Value, New York: Free Press, Revised Edition 1998 Walters, D and Halliday, M (1997) Marketing and Finance: Working the Interface, Allen and Unwin Zeithaml, V.A (1998) ‘Consumer Perceptions of Price, Quality and Value’, Journal of Marketing, 52, 2–22 10 Kelly, S (2005) Customer Intelligence: From Data to Dialogue, Chichester: John Wiley & Sons Ltd 11 McDonald, M., Smith, B and Ward, K (2006) Marketing Due Diligence: Reconnecting Strategy with Share Price, Oxford: Butterworth-Heinemann 12 McDonald, M and Mouncey, P (2009) Marketing Accountability: How to Measure Marketing Effectiveness, London: Kogan Page 13 McGovern, G., Court, D and Quelch, J (2004) ‘Bringing Customers into the Boardroom’, Harvard Business Review, November, 70–80 14 Binet, L and Field, P (2007) ‘Marketing in an Age of Accountability’, IPA Datamine bref 11 July 2011; 10:51:56 Index 3M 147 Cs model 15–16 Ps extended model marketing mix 37–8, 218–303 marketing strategies 203–4 value proposition 15–16 forces model, Porter 145–6 Is of e-marketing 233–42 individualization 238 industry restructuring 240–2 integration 234–5 intelligence 240–1 interactivity 235–8 location independence 238–40 7-Eleven stores 220–1 80/20 rule see Pareto’s law a priori segmentation 114–15 Abratt, Russell 217 accountability 347–8, 354, 361 accounting value 351 addressability 235 advertising 248–50 attitude development 250 creating awareness 249–50 key steps 250 misunderstandings objectives 249–50 roles 248 SDC 439 social media 243–4 airlines British Airways 91–2, 102, 160 market mapping example 116–18 ‘no frills’ companies 162 radar charts 45–6 Virgin 159, 220, 289, 297 Alison, Hazlewood and Partners 412–24 background 412–13 changes in market 414–15 directional strategy 419–21 financial projections 413 footnotes 423–4 key business areas 415–19 market overview 413–14 marketing stance/objectives 421–3 mission statement 412-13 performance summary 413 product portfolio 419–21 SWOT analysis 415–19 three-year plan 413–24 Ambler, Tim 103, 304 annuities case study 138–9 Ansoff matrix gap analysis 188 marketing effectiveness 363–4, 366 marketing objectives 59, 186, 188 Wilcox and Simmonds 445 appeal of product 158 Apple computers 246 asset bases of organizations 12–13 ATMs see automatic teller machines audit see marketing audit automatic teller machines (ATMs) 272 Avis car rental firm 159 Aviva 154–5 The BA Way 91–2 Bain & Company 89 banks diversification 83–4 First Direct 221 product positioning 153 SWOT analyses 179 target audiences 84–5 barriers marketing planning 374 organizational 307–8 Bayus, B 64 Beinstock, Carol 302 benchmarking 151, 217–18, 274 Berry, L.L 222, 302 best practice 40 blueprinting service analysis 295–7 approaches 295 bindex 11 July 2011; 10:47:37 ‘moments of truth’ 296–7 steps to take 295–6 book market mapping 113–14 Boston Consulting Group 188–9 Boston matrix 189 bottom-up planning 70–1, 405 brands/branding personality 158 product plan 220–2 product positioning 154–5 social media 244–5 British Airways 91–2, 102, 160 BT 239 budgets/budgeting 214–18 capital expenses 216–18 finance budgets 216–18 IT 348 limited budget 231 marketing capacity 215 marketing research 319–20 one-year marketing plan 392 planning cycle 336–7 planning process 60 revenue budgets 214–15 spend variation 217–18 strategic plan documentation 390 task-related budgeting 392 zero-based budgeting 216–18 ‘Bugs’ Burger Bug Killers 276 business strategies 80 business strengths 189, 191–2, 194, 196–7, 199 business-to-business (B2B) firms 239, 245, 284 buyers 145, 236–7 capital expense budget 216–18 car market 116, 118 cash generation 197–8 Cassandra accounting system 454, 457, 549–63 CSFs for installation 460 key assumptions 462 key issues 461 objectives 461 pricing 462 486 Index Cassandra accounting system (continued) product strategy 463 promotional strategy 462 sales strategy 463 SWOT analysis 461 see also Moritaki Computers (UK) Ltd centralized marketing 325–9 CEOs see chief executive officers Chambers, Stuart 273 channel-independent task management 228–9 channels 280–7 channel chains 234–5, 283–5 channel options 280–1 choice of 125–6, 280–2 intermediaries 281, 286–7 new channels 282–3 partial channel substitution 130, 286 promotion/communication plan 225–6 reconfiguration 286 strategy options 285–6 value curve 282, 284 working together 282–6 Chatterjee, S 103 chief executive officers (CEOs) delegated planners 75 learning/change process 341–2 marketing expenditure 349 marketing orientation 340 planning failures 329 step-by-step planning system 377 weak support from 68–9 see also top management China Chisnall, P 63 Christensen, C 112 classification of services 29–35 CNN television 146 co-branded emails 247 cold emails 247 Collier, Joel 302 communication communicating the offer 17–20 CRM 227–47 digital 233–47 face-to-face 230 IMC 225 impersonal communications 230, 247–53 personal communications 261–6 planning to plan 69 value propositions 15–16 see also promotion and communication plan company structure 320–9 centralization vs decentralization 325–9 matrix organization 327–9 organizational life-line 320–5 comparative analysis 150–1 competitive positioning 142–5 competition analysis 144 fast-food business 142–3 knowing the competitor 144 portfolio matrix 194–6, 210–11 repositioning 159 SWOT analyses 143 value positioning 13–14 see also positioning competitive strategy 198–201 competitors differentiation 150–1 knowledge of 144 Moritaki Computers 456–7 positioning 13–14, 145, 159 pricing plan 273–4 strategic plan documentation 385 Wilcox and Simmonds 443–4 computer companies Apple 246 Dell 225, 234, 240 diffusion of innovation 168 Dutch company 168, 454–5 Moritaki Computers (UK) Ltd 454–67 see also technology computer market 283–4 Conference Board research network 64 Conservative Party 159 construction industry 167–8 consultants, use of 109 contactors 287–8 contingency plans 206–7, 392 control procedures 304–5, 334 Corkindale, David 251 corporate culture 324 corporate image 220–1, 257–9, 456–7 corporate objectives 56–7, 66, 100–5 core objectives 103 bindex 11 July 2011; 10:47:37 corporate strategies 100–2 customer needs 104, 106 financial services 102–3 high-level objectives 103 mission statements 100, 104–5 organizational focus 101–2 quantitative/qualitative 102–4 corporate planning 74–5 corporate strategies 57, 100–2 costs competitors 273–4 cost-benefit appraisals 319 cost-effectiveness 260, 318 cost-plus pricing 275 definition 66 marketing research 318–19 one-year marketing plan 397–8 Porter matrix 199–201 pricing plan 272–3 structures 272–3 value proposition 15–16 Coviello, N.E 112 crises 206–7, 322–4 Critical Success Factors (CSFs) marketing effectiveness 362–5 Moritaki Computers 460, 463, 465 step-by-step planning 403 Wilcox and Simmonds 447–9 CRM see Customer Relationship Management Crocker, Jack 99 cross-functional cooperation 214–15, 316 CSFs see Critical Success Factors culture, corporate 324 customer insight 244 customer markets 146 customer needs 104, 106 Customer Relationship Management (CRM) 112, 227–47 Is of e-marketing 233–42 channel-independent task management 228–9 communication 227–47 digital communications 233–47 integrated marketing 42–6 limited budget 231 social media 233–46 style of relationship 31 task-independent data management 228 Index 487 travel company examples 229–30 viable structures 228 customer retention 41–2 customer satisfaction fast-food business 142–3 performance metrics 304 portfolio matrix 193 customer service 298–301 creating strategy 300–1 definition 299 key elements 299 KPIs 301 misunderstandings 10 personal communication 261 social media 245–6 standards 301 see also Ps extended model customer value 11, 351 customers branding 221 British Airways 102 corporate image 258 early adopters 166–8, 251, 360 early majority 251 innovators 166–8, 251–2 laggards 166, 251 late majority 166, 168 marketing audit 111–39 matching process 8–9 needs/wants 8–9, 15–16, 39 SDC 430–33, 439 segmentation 38–9 view of company 218 see also customer customization 32–3 data fusion 311 data management 228 databases 310–16 data fusion 311 database marketing 310–12 definition of database 310 internal/external audit 312 marketing system model 314–15 MISs 310–16 myths/reality 311 Davidson, Hugh 94–6, 348 decentralized marketing 325–9 decision-making 292–3 delivery of services 34–5 Dell computers 225, 234, 240 demand 33–4, 271 desk research 317–18 DHL delivery company 92–3 dialogue 235–8 differentiation 148–51, 199–201 diffusion of innovation 164–8 channel chains 285 computer supplier example 168 construction industry example 167–8 customer types 166 as diagnostic/forecasting tool 166–7 impersonal communications 250–2 newness of product 164 rate of diffusion 164 retailer example 164–6 universal pattern 164–5 digital communications 233–47 Is 233–42 email 246–7 mix 242–7 SEO 242–3 social media 243–6 viral marketing 246–7 direct marketing 259–61 approaches 259 cost-effectiveness 260 management of 260 personalized contact 260 technology advances 260 directional policy matrix (DPM) see portfolio matrix disintermediation 129–30, 240, 286 distinctive competence 130 distribution 225–6 diversification 83–4 DPM (directional policy matrix) see portfolio matrix Driver & Vehicle Licensing Agency (DVLA) 239 due diligence 357, 359–61 DVLA see Driver & Vehicle Licensing Agency e-marketing 233–42 E-S-QUAL model 303 e-service quality 302 early adopters 166–8, 251, 360 early majority 251 bindex 11 July 2011; 10:47:38 ecological planning models 52–3 effectiveness of mission 81 see also marketing effectiveness Egg financial services provider 240 electronic banking 273 email 246–7 emotional appeal of product 158 employees Marriott 86 mission engagement 99–100 see also salespeople; staff employment growth 2–3 Enron 84 environmental audit 144–8 future aspects 146–7 market domains 146 political/social factors 146 Porter’s five forces 145–6 Starbucks 147–8 see also marketing environment expenditure 348–9, 368–70 experience curves 272–4 face-to-face communications 230 see also personal communications Facebook 243 fast-food business 142–3 fast-moving consumer goods (FMCG) 154, 353, 368 finance budget 216–18 financial ratios 400 financial services brands 154–5 interactivity example 237–8 market mapping 114, 116 objectives 102–3 portfolio matrix 193–5 see also banks First Direct bank 221 first-year implementation programme 218–19 forces model, Porter 145–6 FMCG see fast-moving consumer goods football clubs 83 forecasting results 204–5 formality 334–5 Fortune companies 81 four Cs model 15–16 four Ps extended model see Ps extended model 488 Index Foursquare social network 239 functional quality 302 gap analysis 187–8, 446 General Electric 282–3 General Mills 93 General Motors 247 generic mission statements 87–8 Gestetner copiers 83 GlobalTech case study 131–7 Goldman Sachs 95–6 Google 243 Greenley, G 64 Greiner’s life-line model 321–5 autonomy crisis 322 collaborative evolution 323, 325 control crisis 323 coordinated evolution 323, 325 creative evolution 321, 325 delegated evolution 322–3, 325 directed evolution 322, 325 leadership crisis 321–2 marketing planning approaches 325 maturity of company 324 next crisis 323–4 phases 321–4 profitability 324 red-tape crisis 323 Gr€ onroos, C 224 Gummesson, Evert 26, 27 Hackett Benchmarking 103 heterogeneity, IHIP 23, 28–9 HFs see Hygiene Factors hierarchy of audits 332–4 high-tech case study 131–7 history of marketing 39–41 best practice 40 development pattern 40–1 final stage activities 41 Holiday Inn 221 Hooley, G.J 64 Hygiene Factors (HFs) 362–3, 366 IBM increased business share 25–6 intranet ‘values jam’ 90–1, 97 mission statements 83, 89–91 IHIP characteristics 23–5, 27–9 Ikea 220 IMC see Integrated Marketing Communications impersonal communications 230, 247–53 advertising 248–50 diffusion of innovation 250–2 other markets 252 sales promotion 252–3 implementation programmes 201, 203, 218–306 implementation risk 357–9 importance of services 1–3 independent schools sector 174–7 individual positioning 152 individualization 238 industry positioning 152 industry restructuring 240–2 influence markets 43–6, 146 influencers 288 information 308–20 change processes 343 costs 319 database marketing 310–12 definitions 312–13 flows diagram 314 marketing objectives 313 marketing research 316–20 marketing system components 314–15 MISs 308–16 needs 308, 314 successful usage 312–16 information technology (IT) budgets 348 companies 104–5, 218 marketing definition 11 innovation 223–4 see also diffusion of innovation innovators 166–8, 251–2 inseparability, IHIP 23, 28–9 insurance companies case study 138–9 portfolio matrix 194–5 product positioning 153–4 salespeople 264 intangibility branding 220 nature of service 30 IHIP 23–5, 27–9 value added 352 Integrated Marketing Communications (IMC) 225 integration Is 234–5 channel chain diagrams 234–5 bindex 11 July 2011; 10:47:38 IMC 225 marketing mix 301–2 relationship marketing 42–6 intelligence 240–1 see also marketing intelligence systems interactivity Is 235–8 example 237–8 purchasing process 235–7 internal markets/marketing 289–91 environmental audit 146 key marketing elements 289 relationship marketing 43–6 service-profit chain 291 UK 290 Internet Is 234 B2B firms 239 channel choice 284–5 DVLA 239 email 246–7 intelligence 240 Starbucks 147–8 wireless 147–8 interpretive planning models 51–3 isolateds 288–9 IT see information technology Japan 65 Johnson, Robert 273 Journal of Marketing Management 112–13 Judd, V 287 judgement 32–3 Keegan, W.J 65 Kelly, Sean 356 key performance indicators (KPIs) 301 knowledge promulgation market 115 Kotler, P 4, 24, 340 KPIs see key performance indicators Kryptonite locks 240 lag indicators 362, 366 laggards 166, 251 large companies 331 late majority 166, 168 Laura Ashley 84 Index 489 lawn mower market 117, 119 lead indicators 362, 366 leadership organizational life-line 321–2 planning models 52–3 service-profit chain 291 strategic plan 65 learning and change process 340–4 CEOs 341–2 evaluation 341 in-company workshops 342 process diagram 341 stages 340–1 support activities 342–4 Leppard, J 324 Levitt, Theodore 26, 83 lifecycle analysis 161–9 diffusion of innovation 164–8 lifecycle curve 161 market share 163 phases 161–2 pricing 274 service portfolios 168–9 service stages 162–3 types of service 163 life-line see organizational life-line line management 71, 75 location 238–40, 279–80 logical incremental planning models 52–3 Lovelock, C 29–30, 35, 223, 299 Lusch, Robert 26 maintenance expenditure 368–70 managers 109–10, 378–9 see also top management manufacturing 35–6, 217 market attractiveness 189–97, 199, 208–11 market characteristics table 120 market definitions 13–14 market domains 43–7, 146 market mapping 113–17, 121–2, 125, 129 market orientation 87, 327–8 market positioning 457–8 market risk 357–9 market sectors 114 market segmentation 13–15, 111–39 airline mapping example 116–18 case studies 131–9 causes 116–21 customers 38–9 definitions 111–15, 121–2 excellent/weak strategies 113 future aspects 129–30 general market shape 118–19 history 112–13 how to it 121–7 importance of 130–1 information usage 313 leverage points 116 major approaches 116–17 market mapping 113–17, 121–2, 125, 129 micro-segments 123 portfolio matrix 192, 193, 208–11 process diagrams 124–5 product lifecycles 120 quick exercise 126, 128–9 segmentation criteria 121 stages/steps 121–30 summary diagram 126–7 SVA 360 understanding 124–5 market share 163, 428 market value added (MVA) 350–1 marketing audit 4–7, 57–8, 108–73 annual audits 109 checklists 172–3 competitive position 142–4 contents 110–11 customers 111–39 environmental audit 144–7 hierarchy of audits 332–4 internal/external 312 market segmentation 111–39 organizational audit 169–71 planning cycle 332–4, 336, 338, 340 service audit 147–69 step-by-step planning 377–9 sub-audits 110–71 who does it 109–10 marketing capacity budget 215 marketing concept 8–9 marketing definitions 10–11 marketing effectiveness 3–7, 347–72 accountability 347–8, 354, 361 common metrics 371 long term case history 368–9 bindex 11 July 2011; 10:47:38 marketing audit 4–7 marketing expenditure 348–9 measurement 347–72 overall metrics model 363, 365, 367 professional firm ratings questions to be asked 370–1 SVA 350–61 three-level model 353–70 measuring effectiveness 362–6 promotional effectiveness 367–70 SVA 354–61 value added 349–61 marketing environment 458–9 see also environmental audit marketing expenditure 348–9 marketing intelligence systems (MISs) 308–16 building-block approach 309–10 database marketing 310–12 definition 310 detailed data 310 four steps 309 information usage 312–16 internal sources 309–10 management 316 Marketing Investment Planner 2011 Benchmark Study 217–18 marketing misunderstandings 9–10 marketing mix 36–9, 218–303 alternative mixes 205–7 consistency 301–2 contingency plans 206–7 crisis effects 206–7 customer service 298–301 integration 301–2 leverage 301–2 major elements 202–3 optimum strategy 303 overall strategy 301–3 people element 287–91 physical evidence 38 place plan 279–87 pricing plan 268–79 processes 38, 292–8 analysis 293–7 blueprinting 295–7 complexity 293–5 decision-making 292–3 490 Index marketing mix (continued) divergence 293–5 operations vs marketing 297–8 product plan 219–25 promotion and communication plan 225–66 quality of service 301–3 strategies 202–3, 205–7, 301–3 value proposition 16 Wilcox and Simmonds 452 see also Ps extended model marketing objectives 184–204 Alison, Hazlewood and Partners 421–3 Ansoff matrix 59, 186, 188 consolidating plans 403–4 courses of action 185–6 criteria 185 definition 184 gap analysis 187–8 information 313 levels of objectives 184–5 marketing strategies 201–2 new markets 186 one-year marketing plan 395, 397 planning cycle 336 portfolio management 188–90 portfolio matrix 189–200 profit improvement 189 revenue generation 191–3 SDC 436–7 setting objectives 185–201 strategic plan documentation 388–9, 391 Wilcox and Simmonds 450–1 marketing operations 226–7 marketing orientation 338–40 marketing process new process overview 11–13 summary diagram 21 see also planning process marketing research 316–20 budgeting 319–20 costs 318–19 definition 316 methods 317–18 marketing return on investment 362–3 marketing strategies 184–204 Ps extended model 203–4 competitive strategies 198–201 definition 184 development 198–201 general policies 203–4 implementation 201, 203 marketing mix 202–3 marketing objectives 201–2 one-year marketing plan 395–7 planning cycle 336 Porter matrix 198–201 portfolio matrix 198 SDC 436–7 strategic plan documentation 388, 391 strategy formulation 184–204 typical contents 202 Wilcox and Simmonds 450–2 marketing system model 314–16 components 314–15 development of 315–16 Marriot Hotels 155–6 Marriott, Bill 85–6 matching process 8–9, 47 matrices Boston matrix 189 matrix organization 327–9 Porter matrix 198–201 portfolio matrix 189–200, 207–11, 402 see also Ansoff matrix matrix organization 327–9 market orientation 327–8 service orientation 327–8 training/consultancy firm 327–8 measurement of effectiveness 347–72 ‘member’ relationships 31 MISs see marketing intelligence systems mission, sense of 56 mission statements 80–100 Alison, Hazlewood and Partners 412-13 broad/narrow 82–4 business type 86 contents 88 corporate objectives 100, 104–5 definition 82 development 96–8 effectiveness 81 examples 88–93 key issues 82–8 levels 94 market orientation 87 Moritaki Computers 455 nature of 82–8 bindex 11 July 2011; 10:47:38 past studies 80–2 preparation level 87–8 realizable missions 99–100 reviews 98 strategic plan documentation 380 target audiences 84–6 uniqueness 86–7 unwritten 82 vision/values 94–6 Wilcox and Simmonds 442 workshops 97–8 mix see marketing mix modifiers 288 ‘moments of truth’, blueprinting 296–7 monitoring 213–306 control and review 304–5 personal communication 261 value 20–2 Morganis, Howard 348 Moritaki Computers (UK) Ltd 454–67 background 454–5 Cassandra system 454, 457, 459–63 company image 456–7 competitors 456–7 corporate mission 455 CSFs 460, 463, 465 development services 463–5 hardware 465–7 market positioning 457–8 market review 455–6 marketing environment 458–9 multi-user applications 465–7 pricing 462, 464–5, 466 product plans/analyses 459–67 product strategy 463, 465, 467 promotional strategy 462, 465, 467 situation review 455–9 SWOT analysis 458–9, 461, 463–6 MVA see market value added nature of marketing 23–48 net free cash flow 192 net present value (NPV) 368–70 new products 164, 223–4 Nike 238 non-reactive research methods 317–18 Index 491 Nordstroms 221, 289 NPV see net present value objectives see marketing objectives Ocado retailer 239 one-year marketing plan 392–401 activities 397–8, 401 costs 397–8 documentation 395–401 financial ratios 400 objectives 395, 397 operating results 400 responsibilities 397 risk assessment 399 strategies 396–7 suggested format 393–4 timing 397 onlineshoes.com 245 operations 4–6, 73–4, 297–8, 334–8 opinion leaders 166, 251–2 opportunities see SWOT analysis organization for planning 307–45 organizational audit 169–71 resources 170 roles/relationships 170–1 skills 169–70 systems 170 organizational focus 101–2 organizational life-line 320–5 company maturity 324 corporate culture 324 crisis phases 324 see also Greiner’s life-line model organizational positioning 152 outsourcing activities 2–3 Parasuraman, A 222, 302 Pareto’s law 142, 167 partial channel substitution 130, 286 Patterson, P.G 299 PC see personal computer penetration pricing policies 278 people 287–91 internal marketing 289–91 quality of 287 roles 287–9 see also Ps extended model performance Alison, Hazlewood and Partners 413 KPIs 301 metrics 304–5 mission statements 80–1 monitoring 304–5 portfolio matrix 192 SBUs 381 studies 65 perishability, IHIP 23, 28–9 personal communications 261–6 functions 261 personal selling 262 sales plan 264–6 salespeople 232, 262–5 top management 261 personal computer (PC) market 246, 283–4 PFs see Productivity Factors place channel decisions 280–7 location decisions 279–80 plan 279–87 see also Ps extended model planners 74–5, 77 planning cycle 330–41 how process works 331–8 marketing audit 332–4, 336, 338, 340 marketing orientation 338–40 overview 337–8 plan formality 334–5 planning horizons 330–1 plans for planning 335–8 scenario planning 337 step-by-step planning 406 time cycle diagram 336 total process diagram 338–9 updating plans 338 planning departments 329–30 planning models 51–4 planning problems 63–78 annual ritual 73 content of plan 77 corporate integration 74–5 designated ‘planner’ 74–5, 77 executive support 68–9 historical studies 63–6 issues to address 69–70 line management support 71 ‘numbers-driven’ mentality 71–2 operational vs strategic 73–4 planning to plan 69–71 short-termism 68 strategic plan 65–7 terminology 71 too much detail 72–3 bindex 11 July 2011; 10:47:38 planning process 49–61 alternative mixes 60 approaches 51–4 benefits 50–1 budget 60 corporate objectives 56–7 definition 50–1 expected results 59–60 implementation programme 60–1, 218–19 key assumptions 58–60 length of plan 54–5 marketing audit 57–8 marketing objectives 59 mission 56 phases 55 short/long-termism 54 step-by-step 373–410 SWOT analyses 58–60 ten steps 55–61 see also budgets/budgeting; situation review; step-bystep planning; strategic context; strategy formulation plans consolidation 400, 402–6 contingency 206–7, 392 one-year marketing 392–401 place 279–87 plans for planning 329–30, 335–8 pricing 268–79 product 219–25, 459–67 sales 253–5, 264–6 SDC 437 tactical marketing 218 updating 338 see also planners; planning ; strategic plan political aspects 52–3, 146 Porter, M 17, 145, 198, 350–1 Porter matrix 198–201 portfolio analysis 449–50 portfolio management 188–90 portfolio matrix 189–200 business strengths 189, 191–2, 194, 196–7, 199 cash generation 197–8 competitive strategy 198–201 consolidating plans 402 construction 193–8 future aspects 196–8 market attractiveness 189–97, 199, 208–11 492 Index portfolio matrix (continued) multiple factors matrix 199 performance expectations 192 rationale 190 revenue generation 191–3 step-by-step guide 197, 207–11 strategy formulation 198 three company example 197–8 portfolios of services 168–9 positioning banks 153 competitors 13–14, 145, 159 market positioning 457–8 service audit 151–61 types 152 see also competitive positioning; product positioning PR see public relations price/pricing Cassandra accounting system 462 market segmentation 130 Moritaki Computers 462, 464–5, 466 pricing plan 268–79 SDC 439 see also Ps extended model pricing plan 268–79 ATMs 272 competition 273–4 corporate objectives 270–1 cost structures 272–3 demand elasticity 271 economic conditions 270 experience curves 272–4 factors involved 269–70 importance of 268 methods 274–8 objectives 269–74 penetration policies 278 product positioning 270 quality 269 range of pricing 277 service capacity 270 service lifecycles 274 skimming policies 278 product Ps extended model 37–8 lifecycles 120 plan 219–25 positioning 151–61 surround 47–8 tangibility 24–5, 27–9 see also Ps extended model product plan 219–25 branding 220–2 management of 224–5 new products 223–4 physical evidence 222–3 product positioning 151–61 banks 153 brand personality 158–9 core demand areas 157–8 differences criteria 151–2 evaluating options 159–60 financial services 153–5 five steps 155–61 guidelines 159 implementation 160–1 insurance companies 153–4 key attributes 156 levels 152–3, 155–6 maps 156–9 pricing plan 270 process of 155–61 product appeal 158 service audit 151–61 strategy examples 160 see also positioning Productivity Factors (PFs) 362–3, 366 profit customer retention 41–2 Greiner’s life-line model 324 improvement diagram 189 service-profit chain 291 Wilcox and Simmonds 442 promotion Cassandra accounting system 462 example strategies 462, 465, 467 marketing effectiveness 367–70 Moritaki Computers 462, 465, 467 promotion/communication plan 225–66 SDC 439 see also Ps extended model promotion and communication plan 225–66 changing nature 225–6 channel choice 225–6 CRM 227–47 distribution 225–6 IMC 225 impersonal communications 247–53 bindex 11 July 2011; 10:47:38 marketing operations 226–7 new sales process 226–7 personal communications 261–6 sales promotion 226–7, 240, 252–61 public relations (PR) 255–9 corporate image 257–9 tasks addressed 256–7 tools 259 university publics 257 purchasing 123–5, 235–7 purpose statements 87–8, 94–6 push-based marketing models 18, 235–6 qualitative objectives 102–4 quality people 287 service/product 269, 301–3 strategic plan test 406–10 quantitative objectives 102–4 radar charts 45–6 railway companies 33, 34, 83 Rappaport, Alfred 350–1 rational product appeal 158 ratios, financial 400 reactive research methods 317–18 recessions 50 recruitment 43–6, 85–6, 146 reference theory 164 referral markets 43–6, 146 reintermediation 130, 240, 286 relationship marketing 42–6 six market domains 43–7 transaction vs relationship 44 value proposition 19–20 relationships customer retention 41–2 with customers 31 organizational audit 170–1 pricing 275–8 relationship marketing 19–20, 42–6 social media 245 relative market share 428 reliability 303 reputation of marketing 349 research see marketing research resources allocation 213–66, 267–306 organizational audit 170 sharing 23–4 Index 493 retail companies 164–6 see also individual companies retention of customers 41–2 return on investment (ROI) 192, 269, 362–3, 369 revenue 191–3, 214–15, 367 risk 356–61 analysis 177, 180 assessment 399 aversion 138–9 causes 357, 359 components 357–9 knowledge usefulness 359–61 marketing research 317, 319 one-year marketing plan 399 subdivisions 357 SVA 356–61 Rogers, E 164, 251, 285 ROI see return on investment Rolls-Royce 25 running reference files 379 S-D (service-dominant) logic 26–7 sales advertising 248–50 Cassandra accounting system 463 forecasts 214–15 ledgers 309–10, 312 misunderstandings personal communication 261–6 portfolio matrix 191–2 process rethink 19 promotion 226–7, 240, 252–61 revenue budget 214–15 salespeople 232, 262–5 strategies 463 traditional marketing 19–20 sales promotion 240, 252–61 direct marketing 259–61 impersonal communications 252–3 key elements 256 mismanaging plans 253–5 new sales process 226–7 objectives 255 preparing plans 253–5 processes 255 public relations 255–9 types 253–61 salespeople 262–5 personal communications 232, 262–5 sales plans 264–6 salesperson plan 265 size of force 263–4 typical activities 263 what they 262–3 see also employees; people; staff satellite markets 43–7 SBUs see strategic business units scenario planning 337 SDC see Steadfast Design Corporation search engine optimization (SEO) 242–3 sectors 1–2, 114, 152, 174–7 segmentation see market segmentation sensual product appeal 158 SEO see search engine optimization service audit 147–69 comparative analysis 150–1 differentiation 148–51 features/benefits 149–51 lifecycle analysis 161–9 positioning 151–61 USPs 148–50 service-dominant logic (S-D) 26–7 service guarantees 276–7 service process analysis 295–7 service-profit chain 291 services classification 29–35 definitions 27, 47–8 nature of marketing 23–48 product definition 47–8 servitization of business 36 SERVQUAL model 302–3 shareholder value added (SVA) 347, 350–61 calculation of 360–1 company value 356 key market segments 360 marketing effectiveness 354–61 risk 356–61 shoes online 245 short-termism 54, 68 Singapore train network 34 situation review 107–82 key assumptions 177, 180–1 marketing audit 108–73 Moritaki Computers 455–9 bindex 11 July 2011; 10:47:38 Steadfast Design Corporation 428–34 SWOT analyses 171, 174–80 six Is of e-marketing see Is of e-marketing size of company 232 size of service sector 1–2 skills 169–70 skimming pricing policies 278 small companies 331 Smith, B 65, 126, 347 Smith, Wendall 112 social factors 146, 233–46 social media 233–46 Is of e-marketing 233–42 brand exposure 244–5 customer insight 244 customer service 245–6 networks 243–4 relationship building 245 software companies 150–1 Sony 147 Spohrer, Jim staff branding 221–2 internal staff 85 judgement 32–3 marketing capacity budget 215 mission statements 85–6 see also employees; salespeople stakeholders 84–6 Starbucks 147–8 Steadfast Design Corporation (SDC) 425–39 advertising 439 background 425 business sector characteristics 429 corporate marketing plan 428 customer base 438–9 customer matrix 430–33 environmental review 434 executive summary 425–7 financial targets 437–8 funding sources 433–4 income 430 marketing objectives 436–7 marketing strategies 436–7 plans/mixes 437 pricing 439 promotion 439 relative market share 428 situation review 428–34 SWOT analysis 426–7, 435 targets/programmes 437–9 494 Index step-by-step planning 373–410 consolidating plans 400, 402–6 definition of planning 373 planning cycle 406 planning summary 373–5 purpose of planning 373 SBUs 376–91 strategic plan 374–91, 400, 406–10 timetable 378 why it is necessary 374 see also one-year marketing plan storyboarding 295 Stostack, Lynn 293 strategic business units (SBUs) consolidating plans 400, 402–6 management of 377 managers and audit 378–9 mission statements 380 performance summary 381 running reference files 379 strategic plan documentation 379–91 strategic plan preparation 376–91 Wilcox and Simmonds 445 strategic context 79–106 corporate objectives 100–5 mission statements 80–100 strategic marketing planning process see planning process strategic plan 374–91, 400, 402–6 Alison, Hazlewood and Partners 412–24 analysis section 377 basis of system 377 consolidating plans 400, 402–6 changes involved 402 directional statement 400, 402 financial history 402 main features summary 402 SBUs and major issues 402–6 contents 76–7, 379–91 documentation 379–91 assumptions 387 competitor analysis 385 consolidated budget 390 financial projections 382 market overview 383 marketing objectives 388–9, 391 marketing strategies 388, 391 SBU mission statement 380 SBU performance 381 SWOT analysis 384, 386 examples 412–65 importance of sections 377 leadership 65 marketing audit 377–9 marketing effectiveness 363 Moritaki Computers 454–67 outline of plan 76 planning cycle 331, 334, 336, 338 planning horizons 331 planning problems 65–7 planning process 55 quality test 406–10 sections 377 Steadfast Design Corporation 425–39 step-by-step planning 374–91, 400, 402–6 SVA 354 why it is useful 66–7 Wilcox and Simmonds 440–53 see also plan strategic planning letters 333 marketing map 12 planning cycle diagram 406 value proposition 14–17 strategic value 35–6 strategy formulation 183–212 alternative mixes 205–7 detailed reviews 204–5 expected results estimation 204–5 marketing objectives 184–204 see also marketing strategies strategy risk 357–9 strengths see business strengths; SWOT analysis Stubbs, John 349 suppliers interactivity 236–7 marketing effectiveness Porter’s five forces 145 relationship marketing 43–6 supplier markets 146 supply and demand 33–4, 271 SVA see shareholder value added SWOT analysis 171, 174–80 Alison, Hazlewood and Partners 415–19 bindex 11 July 2011; 10:47:38 bank analysis 179 competitive positioning 14, 143 extended forms 175–6, 179 independent schools 174–7 layout diagram 174 levels of 176 market segmentation 130 Moritaki Computers 458–9, 461, 463–6 objective/strategy-setting 174 planning cycle 332, 334, 336 planning process 58–60 quantification 177 risk analysis matrix 177, 180 SDC 426–7, 435 strategic plan documentation 384, 386 strategic planning exercise 178 traditional layout 179 Wilcox and Simmonds 446–7 T-Mobile Hot Spot service, Starbucks 148 tactical marketing plans 75, 218, 376 see also implementation programmes Taghian, M 70 tangibility nature of service 30 product characteristics 24–5, 27–9 see also intangibility target markets 15, 84–6, 113, 303 task-independent data management 228 task management 228–9 task-related budgeting 392 technical quality 302 technology direct marketing 260 new technology 145, 260 software companies 150–1 see also computer companies; information technology; Internet Tesco 154 Thompson, Clive 349 threats see SWOT analysis top management audit hierarchies 333 budgets 215 consolidating plans 400, 402–6 delegation of planning 77 Index 495 macro-issues 73 marketing expenditure 349 marketing orientation 339–40 mission statements 82 personal communication 261 planning department 330 plans for planning 69 weak support from 68–9 workshops 97–8 see also chief executive officers top-down planning 70–1, 405 traditional marketing models 18–20, 235–6 training and consultancy company 327–8 training programmes 69 transaction marketing 44 travel companies 229–30 trend analysis 111 UK see United Kingdom uncertainty 317 unique selling propositions (USPs) 148–50 United Kingdom (UK) 390 United States of America (USA) 2–3, 80–1 universities, PR 257 USA see United States of America USPs see unique selling propositions value added 349–61 chains 17, 295, 350 choosing channels 282, 284 curve 282, 284 customer 11, 351 management 452–3 manufacturing services 35–6 monitoring 20–2 positioning 13–14 pricing 275–8 proposition 12, 14–22 shareholder value 347, 350–61 understanding 13–14, 22 value of company 356 Wilcox and Simmonds 452–3 value added 349–61 accounting value 351 customer value 351 marketing effectiveness 349–53 MVA 350–1 SVA 350–61 tangible vs intangible 352 value chain analysis 350 value-based pricing 275–8 value chains analysis 295, 350 blueprinting 295 value proposition 17 value proposition 12, 14–22 Cs extended model 15–16 convenience factors 15–16 delivering 17–20, 21–2 determination of 14–16 marketing map 12 process diagram 15 values, mission statements 94–6 Vargo, Stephen 26 viral marketing 246–7 Virgin Airlines 159, 220, 289, 297 Virgin Atlantic 289, 297 vision 52–3, 65, 94–6 visionary leadership planning models 52–3 Watson, Thomas 89–90 weaknesses see SWOT analysis Wilcox and Simmonds Project Management Ltd 440–53 Ansoff matrix 445 assumptions 449 background 440–1 business acquisition 453–4 competition 443–4 CSFs 447–9 existing/new business 450–1 financial projections 443 gap analysis 446 market overview 443–8 market structure 444 market trends 444 marketing mix 452 marketing objectives 450–1 marketing strategies 450–2 mission statement 442 personnel 442 portfolio analysis 449–50 profit analysis 442 review of first year 441–2 SBUs 445 SWOT analysis 446–7 value management 452–3 Wilson, H 347 wireless internet 147–8 Wirtz, J 299 Woolworths 84 workshops 97–8, 342 Yankelovich, D 113 Zappos online retailer 246 Zeithaml, V 302 zero-based budgeting 216–18 Index compiled by Indexing Specialists (UK) Ltd bindex 11 July 2011; 10:47:38 [...]... 9.8 Academic factors Enhancement/attractiveness factors SWOT Strategic planning exercise (SWOT analysis) Example of the traditional layout for a SWOT analysis Summary of a partial SWOT analysis for a bank Risk analysis matrix for opportunities and threats Example of approach for analysing key assumptions Ansoff matrix Gap analysis Profit improvement The directional policy matrix Setting expectations... staffed for market analysis, competitive analysis, planning, implementation and control? 3 Adequate marketing information – does management receive the kind and quality of information necessary to conduct an effective marketing programme? 4 Strategic orientation – does the firm management generate innovative marketing strategies and plans for long-term growth and profitability, and to what extent have... Centralized marketing, separate operating units 11.10 Decentralized marketing 11.11 The specificity versus duplication balance in marketing planning 11.12 A matrix organization for a training and consulting firm 11.13 Hierarchy of audits 11.14 Strategic and operational planning hierarchy 11.15 Strategic and operational planning hierarchy in detail 11.16 Broad guidelines to the degree of marketing plan formality... of alternative marketing planning models Relationship between corporate objective and strategies Ansoff matrix Marketing planning requires top-down and bottom-up perspectives Integration of corporate planning, strategic marketing planning and tactical marketing planning What should appear in a services strategic marketing plan Key audiences and their expectations in a bank The generic mission statement... differential advantage in any of its operations It is clear that such organizations have confused marketing orientation with selling and promotion The C01 11 July 2011; 14:26:20 Marketing has not yet stormed the citadels of many service organizations 4 Marketing Plans for Services result is that they have merely succeeded in creating a veneer and a vocabulary of marketing Research by the authors into marketing. .. service marketer must formulate an enlarged and more sophisticated marketing mix than has traditionally been the case, and why focusing solely on customer markets will not prove to be enough for a guaranteed long-term marketing success C01 11 July 2011; 14:26:20 8 Marketing Plans for Services The marketing concept Marketing as a source of competitive advantage The central idea of marketing is to match... Marketing planning timetable Form 1 Unit mission statement Form 2 Summary of SBU’s performance Form 3 Summary of financial projections Form 4 Market overview Form 5 Strategic planning exercise (SWOT Analysis) Form 6 Competitor analysis Form 7 Portfolio summary of the SWOTs Form 8 Assumptions Form 9 Marketing objectives and strategies for the next 3–5 years Form 10 Database and summary of marketing objectives... they can afford Another area of misunderstanding is the confusion of marketing with sales Some ill-informed organizations actually believe that marketing is the new word for what was previously called sales Others perceive marketing to be a mere embellishment of the sales process That such companies exist is a sad reflection on the standard of management and suggests that marketing education has been... relationship matrix Customization and staff judgement matrix Supply and demand matrix Service delivery matrix The marketing process General development pattern of marketing approaches Retaining customers pays off Relationship marketing – a broadened view of markets Relationship marketing network diagram for a major international airline The ‘service product’ and the product surround Strengths and weaknesses... of performance Directional policy matrix for a financial services company Ranking market attractiveness and competitive position A financial services company’s MAFs A completed DPM Directional policy matrices for three types of company Cash-generating capabilities of three types of company Multiple factors matrix – generic strategies Other functional guidelines suggested by portfolio matrix analysis