How to Develop A Strategic Marketing Plan: A Step‐by‐Step Guide

Citation

Rich, M.K. (2000), "How to Develop A Strategic Marketing Plan: A Step‐by‐Step Guide", Journal of Business & Industrial Marketing, Vol. 15 No. 4, pp. 291-294. https://doi.org/10.1108/jbim.2000.15.4.291.1

Overview

The focus of most marketers these days in the corporate world is effective use of a strategic marketing plan (SMP). Based on the mixed backgrounds of those holding positions of leadership with the word “marketing” somewhere in the title, delivering an effective SMP can be somewhat of a challenge. Recognizing this, Norton Paley, author of seven other books on marketing plans and strategies, developed this step‐by‐step guide for creating effective SMPs. His 25 years of corporate experience becomes apparent with his no‐nonsense, practical approach to SMP development contained in this book.

Further emphasizing this point is the inclusion of a 3" diskette inside the back cover that contains a fill‐in‐the‐blanks strategic plan (in MS Word95 format) ready for immediate use and available for custom modification by the reader confronted with the task of creating an effective document. The materials on the disk also include step‐by‐step instructions that can be deleted after completing that section of the plan. The book can either act as a resource to provide the reader with a comprehensive overview of each step in the preparation of the plan or as a stand‐alone document to either introduce the reader to the MSP process or to consolidate their existing knowledge of the subject. Each chapter will help sharpen your planning skills as various tools are introduced and explained. For those with an extensive academic background in the subject, the book will probably not provide new insights into the subject of SMPs but will act as a refresher and can be an effective supporting text in a marketing management class at either the undergraduate or graduate level.

Why the intense interest in SMP? According to PricewaterhouseCoopers 1998 Trendsetter Barometer survey, fully two‐thirds of progressive firms have written business plans and tend to grow faster and achieve a higher proportion of revenues from new products and services. The author continues by pointing out that those with SMPs on average increased their revenues 69 percent faster over the past five years than those without such a plan. Business Week[1] cited four issues supporting the need for SMPs:

1. 1.

   (1) Strategy is again a major focus for higher revenues and profits.

2. 2.

   (2) Business strategy is the single most important management issue for the next decade.

3. 3.

   (3) Democratizing the strategy process is achieved by handing it over to teams of line and staff managers from different disciplines.

4. 4.

   (4) Creating networks of relationships with customers, suppliers, and rivals is a strategy of choice to gain greater competitive advantage.

The evolution of the importance of strategic planning becomes evident as the author reviews the historical path of American business. During the 1950s, the USA was in the driver’s seat of economic influence throughout the world as production attempted to satisfy pent‐up demand for consumer goods. Most planning took the form of a financial focus with only top management participating in the process. The 1960s was more of the same with increased world demand for US production. The 1970s signaled a transitional phase in planning as European and Japanese companies became aggressive in attacking US markets. The result was increased marketing planning, focusing on market identification through segmentation and a consolidating of planning efforts related to advertising, merchandising, sales, promotion, and publicity. Marketing as an independent business discipline expanded rapidly into degree programs at universities. The corporate strategic planning process took on a stronger marketing focus. The 1980s saw the effective evolution of MSP within the corporate structure. The MSP was a short‐term plan merged with the long‐term corporate strategic plan. Finally, the 1990s saw the integration of all levels of management into the MSP process to fully embrace the available corporate knowledge base concerning the marketplace and its demands.

The need for a fully integrated approach to the MSP process is based on such typical issues confronting today’s corporation as declining sales, slow domestic growth, changing buyer behavior, increasing competition, and rapidly evolving technology. Corporate orientation also will determine the impact of the resulting MSP. The level of risk aversion possessed by top management will directly drive the innovativeness of the strategies developed. The corporate focus on the product versus its focus on the customer will directly drive the approach contained in the MSP. Research is an important input for an effective MSP so an under‐funded research effort will impair the results. The marketplace should guide product and service development rather than being self‐guided. If that is true for the firm, then a stronger MSP will result. If the driving force behind new product development is the production department rather than searching for needs satisfactions for the marketplace, then the developed MSP will suffer. The bottom‐line is that conditions must be market‐centered within the firm if the efforts to produce a MSP are to be maximized through implementation.

Content

The book is divided into the following six parts:

1. 1.

   (1) Strategic section;

2. 2.

   (2) Tactical section;

3. 3.

   (3) The strategic marketing plan in action;

4. 4.

   (4) Checklists for developing competitive strategies;

5. 5.

   (5) Help topics; and

6. 6.

   (6) Computer disk: how to develop a SMP – a step‐by‐step guide.

Each part is subdivided into rapid‐read sections of about two to seven pages each. The first section (Strategic Section) basically explains the steps involved with developing a meaningful SMP and the relationship of each section of the book with that process. The author in Figure 1 illustrates the interaction of these sections. This process is not a simple matter of filling in the blanks as demonstrated by the author with a series of questions at critical points throughout the book designed to guide the thinking of the SMP developer. The following six questions asked concerning strategic direction illustrate the thinking process that the author is attempting to foster:

1. 1.

   (1) What are your firm’s distinctive areas of expertise?

2. 2.

   (2) What business should your firm be in over the next three to five years?

3. 3.

   (3) What segments or categories of customers will you serve?

4. 4.

   (4) What additional functions are you likely to fulfill for customers as you see the market evolve?

5. 5.

   (5) What new technologies will you require to satisfy future customer/market needs?

6. 6.

   (6) What changes are taking place in markets, consumer behavior, competition, environment, culture, and the economy that will impact your company?

For best results, the author indicates that managers from various departments should contribute to defining the strategic direction of the business by having a role in answering these questions. Further explanation of these questions then consumes the remainder of this section delivering basic marketing tools familiar to the academic in this field but enlightening to many attempting the SMP process.

The business portfolio plans section delivers the classic tools familiar to marketers such as the product‐market opportunity matrix. The difference is that the author integrates the tool into a logical development of the SMP complete with examples. The Boston Consulting Grid and the GE Business Screen (along with others) are introduced and integrated into examples under Part 3, “Looking at your company”. Rather than following the classic delivery of treating these tools (and others) as isolated issues as is often the case in the classroom, they are carefully integrated into discussions at appropriate points were the tool is helpful for the SMP developer to have a clearer sense of direction in the process.

In conclusion, this work is an excellent resource for the practitioner desiring to develop a comprehensive SMP or for an academic application in a learning environment where the instructor desires to tie various marketing courses together with a singular text that demonstrates the practical application of concepts learned in several classes over a number of years. A Strategic Marketing Plan: A Step‐by‐Step Guide, by Norton Paley, is a practical work that helps to make sense of a multitude of tools, concepts, and theories previously delivered to the reader, often in an eclectic fashion over many years.

Note

1. 1.

   Business Week (cover story), 26 August, 1996 issue.