Goal Formulation

Once the company has performed a

SWOT analysis,managers can proceed
to the stage of the goal formulation.
The term goalsis to describe
objectives that are specific with
respect to magnitude and time. The
firm sets objectives, and then manages
by objectives (MBO). As a manager of a
cosmetic firm, MBOs must meet four
criteria.
a. They must be arranged
hierarchically, from the most to
least important. Company may
arranged hierarchically to know
which objectives is the most
important so that the company can
more focus on the most important
objective to achieve. So that, the
company can allocate the resources
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according to the company HR,

Finance and Time.
b. Objectives should be stated
quantitatively whenever possible.
This may Helping company to
determine the key performance
index .To understand How the firm
control and monitor and the effort
done are achieving or not at the
determine time.
c. Goals should be realistic. Goal
cannot be too ambition it may
demotivate employee to achieve
another stage of the objectives.
When goal get too high standard,
employee cannot achieve because
employees may feel demotivate so
employees would not try to achieve
the objective. This is important for
company to set the objectives that is
realistic and encourage the
employee to work harder to
achieving the objectives
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d. Objectives must be consistent.

Objectives from the top to the
bottom of the company may setting
accordingly and consistently for
each department. Eg,the company s
objectives is to cut cost 12%.So that,
companys production department,
HR department ,Marketing
Department are aiming to cut cost
by 4%.So,each department of the
organization must be consistent in
order achieve the objectives.
Moreover, for the marketing
department have to cut cost
4%,therefore, for the 4P, each P have
to cut cost 1% to achieve the cut
cost objectives.
Strategic Formulation

Porters Generic Strategies

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Every business must design a strategy

for achieving its goals, consisting of a
marketing strategy, and technology
strategy, and sourcing strategy.
Strategic is a route that select in order
to achieve the destination. There are
three generic strategies which
proposed by Michael Porter, provided a
good starting point for strategic
thinking.
When the company achieve the lowest
cost, superior performance and focus
on narrow market segment which
means the company can earn a high
profit and competitive edge.
a.

Overall cost leadership

The company works hard to achieve

the lowest production and distribution
costs so that can price lower than its
competitors and win a large market
share. .Company will have the purpose
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to reduce the cost, every department

are cost-orientated for all new project.
High profit because of quantity or
volume of product that sell and when
the price is same with competitors.
Therefore, this is why the company
achieve lower cost compare to
competitor which means get higher
profit. Besides that, Cost leadership is
Competitive edge because create the
unique position in the market where
the competitor or customer realise the
company are the cost leader in the
market when customer want to buy the
product so the company are the first
choice for customer because already
create position in the market.
b. Differentiation (the contrast
between two entities, there is no
diff when just only one in the
market. Difference is exist when
there is comparison)
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The business concentrates on

achieving superior performance in an
important customer benefit area valued
by a large part of the market. The firm
emphasis those strengths that will
create differentiation. Differentiation
get higher profit because the product is
unique to the market so the company
can charge higher price on the product
to the customer who appreciate the
uniqueness feature of the product.
Then the company can earn higher
profit .Differentiation have competitive
edge because the positioning of the
product in the market, when the
company create differentiation, it
create the unique feature in which
when company emphasis unique to
differentiation the product v
competitor in market, when customer
want buy the product, will always refer
back what are the unique or advantage
of product that the customer obtain.
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The companys product will become

priority for customer to select.
c.

Focus

The business focuses on one or more

narrow market segments. Company
build up the niche for differentiation or
cost leadership. Both of this is related
to the market segment to identified or
targeting small and niche market
segment.EG,Harley Davidson targeting
the niche market because the price is
high. Focus is even more extreme
compare to the cost leadership. Whole
company is actually build up only costoriented.
High profit because the product is
unique to the market.Eg,high end
people willimg to pay more for the high
end product (uniqueness) .Competitive
edge,eg,Harley Davidson buyer is
buying the unique positing which is
high end motorbike in the market
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segment .High end people looking for

the high technology of the product.
According to Porter, firms pursuing the
same strategy to the same target
market constitute a strategic group.
The firm that carries out that strategy
best will make the most profits. Porter
defines strategy as the creation of a
unique and valuable position involving
a different set of activities.

Strategic Alliances

Companies are discovering that there

is a need for strategic partners if they
hope to be effective. Stategies
Alliances engaged two organization,
brand or product.Many strategic
alliances take the form of marketing
alliances. These fall into four major
categories:
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a. Product or service alliances One company licenses another to

produce its product, or two
companies jointly market their
complementary products or a new
product. Eg.starbucks alliances v 711.buy 1 Starbucks drinks in 7-11
,cust can redeem one free drinks in
Starbucks outlet v the receipt in 711. Buy 1 free 1.
b. Promotional alliances - One
company agrees to carry a
promotion for another companys
product or service.
Eg,starbucks alliance v 7-11
together to introduce the starbucks
the sales promotion product.This can
increase the product sales of 7-11
because starbucks coffee is selling
exp. Meanwhile, this strategies can
let the people who doesnt have
ability to purchase Starbucks coffee
in outlet to experiences the
starbucks,starbucks is actually
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introduce 7-11 customer to

Starbucks and also upgrading 7-11
standards.
c. Logistics alliances - One
company offers logistical services for
another companys product.Related
to not competitive company.
Eg, furniture manufacturer may
have the container, a paint
companys customer request sending
those product oversea, so the paint
company rent a container space
from Furniture Company to ship
those paint product.
d. Pricing collaborations One or
more companies join in a special
pricing collaboration. Eg. Giant
request reduce the profit and giving
out the promotion brochure, in the
meantime, ask the manufacturer to
reduce the price. Earning profit
through sales promotion.
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To keep strategic alliances thriving,

corporations have begun to develop
organizational structures for support
and have come to view the ability to
form and manage partnerships as core
skills (called Partner Relationship
Management, PRM).
4. Program Formulation and
Implementation
A great marketing strategy can be
sabotaged by poor implementation.
Marketing must estimate its costs. In
implementing strategy, companies
must not lose sight of the multiple
stakeholders involved and their needs.
According to McKinsey & Company,
strategy is only one of seven elements
in successful business practice. The
first threestrategy, structure, and
systems are the hardware of success.
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The next fourstyle, skills, staff, and

shared values are the software
Style means that company employees
share a common way of thinking and
behaving. Skills means that the
employees have the skills necessary to
carry out companys strategy.
Staffing means that the company has
hired able people, trained them well,
and assigned them to the right jobs.
Shared values, means that employees
share the same guiding values.
5. Feedback and Control
As it implements its strategy, the firm
needs to track the results and monitor
new developments. A companys
strategic fit with the environment will
inevitably erode because the market
environment changes faster than the
companys 7Ss.
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Organizations are subject to inertia

and are set up as efficient machines
and it is difficult to change one part
without adjusting everything else.
Product planning: the nature and
contents of a marketing plan
Each product level develops a
marketing plan for achieving its goals.
A marketing plan is a written
document that summarizes what the
marketer has learned about the
marketplace and indicates how the
firm plans to reach its marketing
objectives.
Marketing plans are becoming more
customer and competitor orientated
better reasoned and more realistic
than in the past. The plan draws more
input from all the business functions
and is team developed.
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1. Contents of the marketing plan

Executive summary and table
of contents
The marketing plan should open with a
brief summary of the main goals and
recommendations. The executive
summary permits senior management
to grasp the plans major thrust.

Situation analysis

This section presents relevant

background data on sales, costs, the
market, competitors, and the various
forces in the macro-environment.
Pertinent historical information can be
included to provide context. All this
information is used to carry out on a
SWOT analysis.
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Marketing strategy

Here the product manager defines the

mission, and marketing and financial
objectives. The manager also defines
those groups and needs which the
market offerings are intended to
satisfy. The manager then establishes
the product lines competitive
positioning.

Financial projections

Financial projections include a sales

forecast, an expense forecast, and a
breakeven analysis. On revenue side,
the projections show the forecasted
sales volume by month and product
category. On the expense side, the
projections show the expected costs of
marketing. A more complex method of
estimating profit is risk analysis. The
computer stimulates possible outcomes
- 15 -

and computes a distribution showing

the range of possible rates of returns
and their probabilities.

Implementation controls

The last section of the marketing plan

outlines the controls for monitoring
and adjusting implementation of the
plan. Typically, the goals and budget
are spelled out for each month or
quarter so management can review
each periods results and take
corrective action.
2. The role of research
To develop innovative products,
successful strategies, and action
programs, marketers need up-to-date
information about the environment, the
competition, and the selected market
segments. Marketing research helps
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marketers learn more about their

customers requirements, expectations,
perceptions, satisfaction, and loyalty.
3. The role of relationships
Although the marketing plan shows
how the company will establish and
maintain profitable customer
relationships, it also affects both
internal and external relationships.
4. From marketing plan to
marketing action
Marketers start planning well in
advance of the implementation date to
allow time for marketing research,
analysis, management review, and
coordination between departments.
The marketing plan should define how
progress toward objectives will be
measured.
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MARKETING PROCESSES 2
Components of a modern
marketing information system
Many business firms are not
sophisticated about gathering
information. Many do not have a
marketing research department. Every
firm must organize and distribute a
continuous flow of information to its
marketing manager.
A marketing information system
(MIS) consists of: People(the one who
carry out the marketing information),
Equipment(the instrument like
questionnaire to collect data), and
Procedures(research methodology
must be satisfied,reliable for collect
- 18 -

data) to Gather, Sort, Analyse,

Evaluate. Distribute needed, timely,
and accurate information to marketing
decision makers.
A marketing information system is
developed from: Internal company
records, marketing intelligence
activities, marketing research. The
companys marketing information
system should be a cross between what
managers thinks they need, what
managers really need, and what is
economically feasible.
Internal records and marketing
intelligence
Marketing mangers rely on internal
reports on orders, prices, costs,
inventory levels, receivables, payables,
and so on.(daily activities of marketing)
By analysing this information,
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marketers can spot important

opportunities and problems.
1. Order-to-Payment Cycle
The heart of the internal records
systems is the order-to-payment cycle.
Sales representatives, dealers, and
customers send orders to the firm. The
sales department prepares invoices
and transmits copies to various
departments.
Shipped items are accompanied by
shipping and billing documents that
are sent to the various departments.
Today companies need to perform
these steps quickly and accurately. An
increasing number of companies are
using the Internet and extranets to
improve the speed, accuracy, and
efficiency of the order-to-payment
cycle.
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This record is important to marketer

because the info provide the data about
the preferences of the customer about
the product that the cust
buying,indicating what are the
marketing practices is effective in
influencing the cust to make purchase
decision. This info reflecting the real
outcome of the marketing activities
2. Sales Information Systems
Marketing managers need timely and
accurate reports on current sales.
Companies must carefully interpret the
sales data so as not to get the wrong
signals. Technological gadgets are
revolutionizing sales information
systems and allowing representatives
to have up-to-the second information.
This is important to marketer because
can Monitor the current trend that the
cust have in purchasing the product,in
- 21 -

turn,if something happened that not in

the prediction of company, can change
the marketing plan according to realtime information
3. Databases(building up raw
data), Data Warehouses(bases of
how to you catogories or
grouping the data that u have
collected), and DataMining(analysis the data to make
it become useful information to
help the decision maker to make
decision)
Today companies organize information
in databasescustomer databases,
product databases, salesperson
databasesand then combines data
from the different databases.
Companies warehouse these data for
easy accessibly to decision makers.
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By hiring analysts skilled in

sophisticated statistical methods,
companies can mine the data and
garner fresh insights into: Neglected
customer segments, Recent customer
trends, Other useful information. The
customer information can be crosstabbed with product and salesperson
information to yield still deeper
insights.
4. Marketing Intelligence System
A marketing intelligence system is
a set of procedures and sources
managers use to obtain everyday
information about developments in the
marketing environment. The marketing
intelligence system supplies
happenings data. A company can take
steps to improve the quality of its
marketing intelligence:
- 23 -

a. Train and motivate the sales

force to spot and report new
developments. The company must
sell its sales force on their
importance as intelligence
gatherers. (the SP identified what
are the latest happening in the
market,what is the competitor doing
in the market,and provide these data
to process to become useful
information,develop counter attack
against the competitors).
b. Motivate distributors,
retailers, and other
intermediaries to pass along
important intelligence. Marketing
intermediaries are often closer to
the customer and competitior, and
can offer helpful insights.(build good
relationship v retailers in order for
them to provide what are the latest
sales promotion that the competitor
- 24 -

offer,improving the quality of info

about ur competitor what are their
direction in the future)
c. Hire external experts to collect
intelligence. Service providers
often send mystery shoppers to their
stores to assess how employees treat
customers.(recruit marketing
research firm to collect data about
competitor or the marketing
activities of competitors,help
company improve marketing
intelligence in the expect of what
are the insights cust perceived
things about competitors product in
ur company product)
d. Network internally and
externally. It can purchase
competitors products; attend open
houses and trade shows; read
competitors published reports;
- 25 -

attend stakeholders meetings; talk

to employees,distributors, suppliers;
collect competitors ads; and look up
news stories about competitors. Get
first hand info of competitor by
asking the customer of competitor
directly. For example,Buy share
share competitor,attend their
meeting and ask them question
because you are the shareholders,or
have their financial report,know
what are the competitor planning in
coming years.
e. Set up a customer advisory
panel. Members might include
representative customers or the
companys largest customers or its
most outspoken or sophisticated
customers.(provide insight
information about the users usage
of the company product and what
kind of product they are looking
- 26 -

for ,so can produce the product they

looking for
f. Take advantage of government
data resources. Population census
and trade data are valuable sources
for a first cut about the market.
(eg.Malaysia government collect
census data about citizen such as
geographic,gender,age.useful info
to segment the market,buy the
information or statistic to know
where is ur customer
g. Purchase information from
outside suppliers. These research
firms gather consumer-panel data at
a much lower cost than the company
can on its own.(eg online data base
company,buy the report,the article,to
improve or build up marketing
intelliengence)`

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 Collecting marketing intelligence

on the internet
There are five ways marketers can
research competitors strengths and
weaknesses online.
a.

b.

c.

Independent customer goods and

service review forum. These sites
have the advantage of being
independent from the goods and
service providers, which may reduce
bias.
Distributor or sales agent
feedback sites. These sites offer
either positive and negative product
or service reviews, but the stores or
distributors have built the sites
themselves.
Combo-site offering customer
reviews and expert opinions. The
advantage of this type of review site
is that a product supplier can
- 28 -

d.

e.

compare opinions from the experts

with those from consumers. (include
cust comment about company)
Customer complaint sites. These
forums are designed mainly for
dissatisfied customers. (comment
site based on certain product
catogeries ,eg,food,for you to view
the prodyct review from customers
complain.so that can understand
whay are the situation the
competitors is in and ur product
situation as well)
Public blogs. Consultancy firms
analyse blogs and social networks to
provide firms with insights into
consumer sentiment. (comment on
FB,wechat ,insta,post photo and
warning orther dont go )

Analysing the macroenvironment

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Successful companies recognize and

respond profitably to unmet needs and
trends.
1. Needs and Trends
Enterprising individuals and companies
manage to create new solutions to
unmet needs. A fad is unpredictable,
short-lived, and without social,
economic, and political significance. A
trend is a direction or sequence of
events that has some momentum and
durability. Trends are more predictable
and durable than fads. A trend reveals
the shape of the future and provides
many opportunities.
Mega-trends have been described as
a large social, economic, political, and
technological changes [that] are slow
to form, and once in place, they
influence us for some timebetween 7
- 30 -

and 10 years, or longer. Trends and

mega-trends merit close attention. To
help marketers spot cultural shifts
that might bring new opportunities or
threats, several firms offer socialcultural forecasts.

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