Marketing Management-II

Ques. Explain Corporate planning process.

Corporate planning process involves Iour important activities:
1. Defining corporate mission
n organisation exists to accomplish something, e.g., to make cars, to lend money, to
provide lounging, to provide education etc.
Its speciIic mission or purpose is usually clear when the business starts. Over the period
oI time the mission may change, or to take advantage oI new opportunities or to respond
to new market conditions. Eg amazon.com changed the mission Irom being world`s
largest online bookstore o aspiring to become world`s largest store.

2. Establishing strategic business units (SBU`s)
$& is a distinct business unit oI the business organisation in the Iorm oI subsidiary
company, department, division or product line with speciIic product and market Iocus and
independent authority oI a manager to take business decisions.
strategic business unit has 3 characteristics:
a. It is a single business or collection oI related business that can be planned
separately Irom the rest oI the company.
b. It has its own set oI competitors.
c. It has the manager who is responsible Ior the strategic planning and proIit
perIormance and who controls most oI the Iactors aIIecting proIit.

3. Assigning resources to SBU`s
%he company`s next task is to determine what objective strategy and budgets are to be
assigned to each $&`s.

4. Planning new business
Intensive growth strategies are appropriate when existing products and existing markets
show the potential Ior sales increase.
%here are 4 strategies Ior entering into existing/new markets with existing/new products.
PRODUCT
Existing New

Existing
MARKET
New
ANSOFF`S MATRIX

A) Market Penetration
It is a strategy oI increasing sales oI existing products in existing market.
Encourage customers to buy more.
ttract competitors` customers.
ttract non-users.
E.g. Procter & Gamble reduced the price oI its detergent, riel, to increase its sales
among existing & new customers in the current market.

B) Market Development
It is a strategy to increase sales by introducing existing products into new market. %his can be
done in Iollowing ways:
Expand to new markets
ave additional distribution channels
$elling in new location
E.g. With globalisation and opening up oI Indian borders to new business, many
organisations have introduced their products in Indian market. Like %ropicana, Del
monte, einze, etc.

C) Product Development
It reIers to increase in sales by improving current/existing product in some way or developing
entirely new product Ior existing market.
E.g. Gillette has modiIied its razor and named it as Gillette vector Ior its Indian
consumers.
dding new Ieatures
Explaining advantages and beneIits to the customers

Marketing
Penetration
Product
Development
Market
Development
DiversiIication
D) Diversification
It is a Iorm oI corporate strategy Ior the organisation. It seeks and helps to increase the
proIitability through greater sales volume obtained Irom new product and new market.