Planning: Learning Objectives Importance Goals/ Objectives

PLANNING
CHAPTER 2
LEARNING GOALS/
OBJECTIVES OBJECTIVES
OPERATIONALIZING
DEFINITION STRATEGY
IMPORTANCE
Learning Objectives
After studying this chapter, you should be able to:
 Define planning and plans

 Explain the importance of planning
 Explain ‘goals’ and objectives’
 Describe the various types of plans
 Define decision making
 Identify types and nature of decision making
 Identify types and nature of decision making
Planning
 Process that begins with objectives, defined strategies,
policies and detail plans in order to achieved them.
Planning establishes an organization to implement
decisions and includes a review of performance and
feedback to introduce a new planning cycle. (STEINER)
 A concepts of executive action that embodies the skills

and anticipating and controlling the nature and
direction of change. (MC FARLAND)
 Process of determining in advance what should be

accomplished and how it should be realized. (MONDY)
Plans
 According to Mondy, plans are statement
of how objectives are to be accomplished.
 Through planning, managers can inform
their subordinates about the expectation
of the management, and the objectives of
the organization can be realized.
Importance of Planning
 Why do managers in organizations have to plan?
 Why do you have to plan?
 Why is this activity important to organization?

The reasons are:-
 Helps to determine what opportunities there are to exploit. In other words the
profitable alternatives that exist are identified through a planning process.
 Planning enables us to identify the course of action by setting objectives and
choosing alternatives that will be most profitable.
 Without proper plans’ it will be left to chance and therefore to risk.
 Through plans’ resources are effectively and efficiently utilized this resulting in
saving.
 What is really happening becomes more meaningful when we know what is
really expected.
 It helps to achieve goals and reduces random activity and needless overlapping.
 It provides effective utilization of available facilities of an enterprise.
 Assists a manager in attaining confident and aggressive leadership.
 Planning can point out the need for future changes. It can reveal opportunities
for new services.
Goals
 Goals are the target toward which activity is aimed. Whether
a firm is new or old, large or small it must have its goal. Goal
that are clearly established and properly communicated to
employees stand the best chance of being reached.
 Managers must consider a few characteristics in setting

goals. They are:-
 The goal must be precise, specific and meaningful
 The goal must be clear and coordinated
 The goal must include long term and short term plans to be
successful
For effectiveness to carry out its organizational activities,
organizations should establish many different kinds of goals
such as purpose, mission, objective and strategy. What
make them differ from one another?
1.Purpose
Intention to produce a specific good and
service.
2.Mission
The purpose or reason for the existence of an
organization. The mission of an
organizations is its products or services or
markets or customers.
3.Objective
Estimated end result expected in the future.
Objectives established at organizational,
departmental or individual level.
4.Strategy
Method of shaping a company’s future and
involves determining the long run direction
of the organization.
Integrated Marketing
Communications
 The concept under which a company
carefully integrates and
coordinates its many communications
channels to deliver a clear,
consistent, and compelling message
about the organization and its
products.
Malaysian Example
 Ken Apothecary – retailers of cult

cosmetic products. A bit pricey. Targeted
at middle to higher level executives/ladies
that want to be different/unique.
 Use PR strategies (interviews in glossy

female magazines), launching new
products at events like the launching of
new Volvo, set up perfume boutique at Le
Meridien hotel
The Communication Process
 Communications efforts should be viewed from the
perspective of managing customer relationships over
time.
 The communication process begins with an audit of all

potential contacts a customer might have with the brand.
 Effective communication requires knowledge of how

communication works.
 Two questions that need to be asked:

 How can we reach our customers?
 How can we find ways to let out customers reach us?
Elements in the
Communication Process
Sender Encoding Message Decoding

Media
Noise
Feedback Receiver
Response
Sender’s field Receiver’s field

of experience of experience
Steps in Developing Effective
Communication
 Indentifying the Target Audience

 Determining the Communication Objectives
 Designing a Message
 Choosing Media
 Selecting the Message Source
 Collecting Feedback.
Step 1: Identifying the Target Audience
 Affects decisions related to what, how,

when, and where message will be said, as
well as who will say it
Step 2: Determining Communication
Objectives
Marketers must decide what purchase response they
seek from the target audience.
 Six buyer readiness stages:
i) Awareness – Proton use teaser ads to introduce

Gen-2
ii) Knowledge
iii) Liking – feeling favorable, liking
iv) Preference – prefer Proton Gen-2 to other brands
v) Conviction – believe that Gen-2 is the best car
vi) Purchase – buy Gen-2
Step 3: Designing a Message
 Message must have AIDA framework guides message

design
 A – Attention
 I – Interest
 D – Desire
 A - Action
 Need to consider what to say (message content) and

how to say it (message structure and format)
 Message content: contains appeals or themes
designed to produce desired results
 Rational appeals
 Relate to audience’s self-interest
 Show product will produce desired benefits
 Emotional appeals
 Love, pride, joy, humor, fear, guilt, shame
 Moral appeals
 What is right or proper.
 Urge people to support social causes
 Message Structure: Key decisions are required with
respect to three message structure issues:
 Whether or not to draw a conclusion

 Advertiser asking questions and let the buyers
come to their own conclusion
 One-sided vs. two-sided argument
 One-sided – mention all the benefits
 Two-sided – mention benefits and shortcomings
 Order of argument presentation
 Can get strong attention from the public
 Anti climax
 Message Format: Design, layout, copy,
color, shape, movement, words, sounds,
voice, body language, dress, etc.
Step 4: Choosing Media
 Personal communication channels
 Includes face-to-face, phone, mail, and Internet
chat communications
 Word-of-mouth influence is often critical
 Buzz marketing cultivates opinion leaders
 Non-personal communication channels

 Includes media (print, display and online media)
 Atmosphere (lawyers’ officer are designed to
communicate confidence)
 Events (press conferences, grand opening, shows
and exhibits)
Step 5: Selecting the Message Source
 How audience view

the communicator
 Highly credible
sources are more
persuasive eg Tiger
Woods
 A poor spokesperson
can tarnish a brand
Step 6: Collecting Feedback
 Recognition, recall, and behavioral measures

are assessed
 Asking target audience – remember the ads,
how many times, what points they recall, how
the felt, their past and present attitude about
the product and company
 May suggest changes in product/promotion
Setting the Promotional Budget - 4
Common Methods
 Affordability Method
 Budget is set at a level that a company can afford
 Small companies often use this method, company
cannot spend more on ads
 Start with total revenues, deduct operating expenses and
capital outlays and then devote some for ads.
 Percentage-of-Sales Method
 Past or forecasted sales may be used
 Relationships between promotional spending, selling
price and profit per unit
Setting the Promotional Budget -
4 Common Methods
 Competitive-Parity Method
 Budget matches competitors’ outlays
 Monitor competitors’ ads or get industry promotion
spending estimates from publication or trade
association, then set budgets based on industry average
 Objective-and-Task Method
 Specific objectives are defined
 Tasks required to achieve objectives are
determined
 Costs of performing tasks are estimated, then summed
to create the promotional budget
Setting the
Promotional Mix
 Setting the Overall Promotion Mix
 Determined by the nature of each promotion tool
and the selected promotion mix strategy
 Promotion Tools
 Advertising
 Reaches large, geographically dispersed audiences, often
with high frequency
 Low cost per exposure, though overall costs are high
 Consumers perceive advertised goods as more legitimate
 Dramatizes company/brand
 Builds brand image; may stimulate short-term sales
 Impersonal; one-way communication
 Personal Selling
 Most effective tool for building buyers’ preferences,

convictions, and actions
 Personal interaction allows for feedback and
adjustments
 Relationship oriented
 Buyers are more attentive
 Sales force represents a long-term commitment
 Most expensive of the promotional tools
 Sales Promotion
 Makes use of a variety of formats: premiums, coupons,

contests, etc.
 Attracts attention, offers strong purchase incentives,
dramatizes offers, boosts sagging sales
 Stimulates quick response
 Short lived
 Not effective at building long-term brand preferences
 Public Relations
 Highly credible
 Many forms: news stories, news features, events and
sponsorships, etc.
 Reaches many prospects missed via other forms of
promotion
 Dramatizes company or benefits
 Often the most underused element in the promotional
mix
 Direct Marketing
 Many forms: Telephone marketing, direct mail,

online marketing, etc.
 Four distinctive characteristics:
 Nonpublic
 Immediate
 Customized
 Interactive
 Well-suited to highly targeted marketing efforts
Promotion Mix Strategies
 Push Strategies
 A promotion strategy that calls for using sales force and trade
promotion to push the product through channels
 Usually used by B2B companies (Example, when retailers are
strong)
 Pull Strategies
 A promotion strategy that calls for spending a lot on
advertisement and consumer promotion to induce final
consumers to buy the product.
 Usually used by B2C companies
• Refer page 387
Most large companies use both strategies.

Socially Responsible
Communications
 Advertising and Sales Promotion
 Avoid false and deceptive advertising
 No bait-and-switch advertising
 Trade promotions can not favor certain customers over others
 Use advertising to promote socially responsible programs and
actions
 Personal Selling
 Salespeople must follow the rules of “fair competition”
 Business-to-business selling
 Bribery, industrial espionage, and making false and
disparaging statements about a competitor are forbidden

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PLANNING

 Define planning and plans

 A concepts of executive action that embodies the skills

 Process of determining in advance what should be

 Why do managers in organizations have to plan?

 Why do you have to plan?

 Why is this activity important to organization?

 Managers must consider a few characteristics in setting

 Ken Apothecary – retailers of cult

 Use PR strategies (interviews in glossy

 The communication process begins with an audit of all

 Effective communication requires knowledge of how

 Two questions that need to be asked:

Sender Encoding Message Decoding

Sender’s field Receiver’s field

 Indentifying the Target Audience

 Affects decisions related to what, how,

 Six buyer readiness stages:

i) Awareness – Proton use teaser ads to introduce

 Message must have AIDA framework guides message

 Need to consider what to say (message content) and

 Whether or not to draw a conclusion

 Non-personal communication channels

 How audience view

 Recognition, recall, and behavioral measures

 Most effective tool for building buyers’ preferences,

 Makes use of a variety of formats: premiums, coupons,

 Many forms: Telephone marketing, direct mail,

Most large companies use both strategies.

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