Objectives set out what the business is trying to achieve.
Objectives can be set at two levels:
(1) Corporate level
These are objectives that concern the business or organisation as a whole
Examples of “corporate objectives might include:
• We aim for a return on investment of at least 15%
• We aim to achieve an operating profit of over £10 million on sales of at least £100 million
• We aim to increase earnings per share by at least 10% every year for the foreseeable future
(2) Functional level
e.g. specific objectives for marketing activities
Examples of functional marketing objectives” might include:
• We aim to build customer database of at least 250,000 households within the next 12 months
• We aim to achieve a market share of 10%
• We aim to achieve 75% customer awareness of our brand in our target markets
Both corporate and functional objectives need to conform to the commonly used SMART criteria.
The SMART criteria (an important concept which you should try to remember and apply in exams) are summarised below:
Specific - the objective should state exactly what is to be achieved.
Measurable - an objective should be capable of measurement – so that it is possible to determine whether (or how far) it has been achieved
Achievable - the objective should be realistic given the circumstances in which it is set and the resources available to the business.
Relevant - objectives should be relevant to the people responsible for achieving themTime Bound - objectives should be set with a time-frame in mind. These deadlines also need to be realistic.
3/07/2008
marketing planning
A strategic marketing plan starts with a clearly defined business mission.
Mintzberg defines a mission as follows:
“A mission describes the organisation’s basic function in society, in terms of the products and services it produces for its customers”.
A clear business mission should have each of the following elements:Taking each element of the above diagram in turn, what should a good mission contain?
(1) A Purpose
Why does the business exist? Is it to create wealth for shareholders? Does it exist to satisfy the needs of all stakeholders (including employees, and society at large?)
(2) A Strategy and Strategic Scope
A mission statement provides the commercial logic for the business and so defines two things:
- The products or services it offers (and therefore its competitive position)- The competences through which it tries to succeed and its method of competing
A business’ strategic scope defines the boundaries of its operations. These are set by management.
For example, these boundaries may be set in terms of geography, market, business method, product etc. The decisions management make about strategic scope define the nature of the business.
(3) Policies and Standards of Behaviour
A mission needs to be translated into everyday actions. For example, if the business mission includes delivering “outstanding customer service”, then policies and standards should be created and monitored that test delivery.
These might include monitoring the speed with which telephone calls are answered in the sales call centre, the number of complaints received from customers, or the extent of positive customer feedback via questionnaires.
(4) Values and Culture
The values of a business are the basic, often un-stated, beliefs of the people who work in the business. These would include:
• Business principles (e.g. social policy, commitments to customers)• Loyalty and commitment (e.g. are employees inspired to sacrifice their personal goals for the good of the business as a whole? And does the business demonstrate a high level of commitment and loyalty to its staff?)• Guidance on expected behaviour – a strong sense of mission helps create a work environment where there is a common purpose
What role does the mission statement play in marketing planning?
In practice, a strong mission statement can help in three main ways:• It provides an outline of how the marketing plan should seek to fulfil the mission• It provides a means of evaluating and screening the marketing plan; are marketing decisions consistent with the mission?• It provides an incentive to implement the marketing plan
Mintzberg defines a mission as follows:
“A mission describes the organisation’s basic function in society, in terms of the products and services it produces for its customers”.
A clear business mission should have each of the following elements:Taking each element of the above diagram in turn, what should a good mission contain?
(1) A Purpose
Why does the business exist? Is it to create wealth for shareholders? Does it exist to satisfy the needs of all stakeholders (including employees, and society at large?)
(2) A Strategy and Strategic Scope
A mission statement provides the commercial logic for the business and so defines two things:
- The products or services it offers (and therefore its competitive position)- The competences through which it tries to succeed and its method of competing
A business’ strategic scope defines the boundaries of its operations. These are set by management.
For example, these boundaries may be set in terms of geography, market, business method, product etc. The decisions management make about strategic scope define the nature of the business.
(3) Policies and Standards of Behaviour
A mission needs to be translated into everyday actions. For example, if the business mission includes delivering “outstanding customer service”, then policies and standards should be created and monitored that test delivery.
These might include monitoring the speed with which telephone calls are answered in the sales call centre, the number of complaints received from customers, or the extent of positive customer feedback via questionnaires.
(4) Values and Culture
The values of a business are the basic, often un-stated, beliefs of the people who work in the business. These would include:
• Business principles (e.g. social policy, commitments to customers)• Loyalty and commitment (e.g. are employees inspired to sacrifice their personal goals for the good of the business as a whole? And does the business demonstrate a high level of commitment and loyalty to its staff?)• Guidance on expected behaviour – a strong sense of mission helps create a work environment where there is a common purpose
What role does the mission statement play in marketing planning?
In practice, a strong mission statement can help in three main ways:• It provides an outline of how the marketing plan should seek to fulfil the mission• It provides a means of evaluating and screening the marketing plan; are marketing decisions consistent with the mission?• It provides an incentive to implement the marketing plan
Marketing planning
A plan is a way of achieving something. Your revision plan is a way of helping to achieve success in business studies exams. The Christmas present shopping list is a simpler example of a plan – a way of ensuring that no-one gets missed on 25 December.
In business, it is no different. If a business wants to achieve something, it is more likely to do so with a well-constructed and realistic plan.
What does planning involve? Planning involves:
• Setting objectives, quantifying targets for achievement, and communicating these targets to people responsible for achieving them• Selecting strategies, tactics, programmes etc for achieving the objectives.
The whole topic of planning brings with it some important terminology that it is worth spending time getting to know well. You will come across these terms many times in your study of marketing (and business studies in general):
Strategy
Strategy is the method chosen to achieve goals and objectives
Example: Our strategy is to grow sales and profits of our existing products and to broaden our business by introducing new products to our existing markets
Tactics
Tactics are the resources that are used in the agreed strategy
Example: We will use our widespread distribution via UK supermarkets to increase sales and existing products and introduce new products
Goals
Goals concern what you are trying to achieve. Goals provide the “intention” that influence the chosen actions
Example: Our goal is to achieve market leadership in our existing markets
Objectives
Objectives are goals that can be quantified
Examples:- We aim to achieve a market share of 20% in our existing markets- We aim to penetrate new markets by achieving a market share of at least 5% within 3 years- We aim to achieve sales of growth of 15% per annum with our existing products
Aims
Aims are goals that cannot be measured in a reliable way. However, they remain important as a means of providing direction and focus.Examples: We aim to delight our customers
In business, it is no different. If a business wants to achieve something, it is more likely to do so with a well-constructed and realistic plan.
What does planning involve? Planning involves:
• Setting objectives, quantifying targets for achievement, and communicating these targets to people responsible for achieving them• Selecting strategies, tactics, programmes etc for achieving the objectives.
The whole topic of planning brings with it some important terminology that it is worth spending time getting to know well. You will come across these terms many times in your study of marketing (and business studies in general):
Strategy
Strategy is the method chosen to achieve goals and objectives
Example: Our strategy is to grow sales and profits of our existing products and to broaden our business by introducing new products to our existing markets
Tactics
Tactics are the resources that are used in the agreed strategy
Example: We will use our widespread distribution via UK supermarkets to increase sales and existing products and introduce new products
Goals
Goals concern what you are trying to achieve. Goals provide the “intention” that influence the chosen actions
Example: Our goal is to achieve market leadership in our existing markets
Objectives
Objectives are goals that can be quantified
Examples:- We aim to achieve a market share of 20% in our existing markets- We aim to penetrate new markets by achieving a market share of at least 5% within 3 years- We aim to achieve sales of growth of 15% per annum with our existing products
Aims
Aims are goals that cannot be measured in a reliable way. However, they remain important as a means of providing direction and focus.Examples: We aim to delight our customers