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Professor Carl Mela BA 460 Product Management Fuqua School of Business. Brand Management System On Building A Brand Managing Across Brands. Marketing Planning. Agenda. Marketing Planning PharmaSim. The Purpose of Planning. “Planning is everything, plans are nothing.” General Eisenhower

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marketing planning
Professor Carl Mela

BA 460 Product Management

Fuqua School of Business

Brand Management System

On Building A Brand

Managing Across Brands

Marketing Planning
  • Marketing Planning
  • PharmaSim
the purpose of planning
The Purpose of Planning
  • “Planning is everything, plans are nothing.”
    • General Eisenhower
  • Planning is to a large extent the job of making things happen that would not otherwise occur.
obstacles to planning
Obstacles to Planning
  • Good Forecasting
  • Time
  • Lack of Process
  • Lack of Management Commitment
responsibility for planning
Responsibility for Planning

Source: Conference Board

responsibility for approving plans
Responsibility for Approving Plans

Source: Conference Board

planning horizon
Planning Horizon

Source: Conference Board

top down v bottom up
Top Down v. Bottom Up
  • Bottom Up
    • Closer to implementation, motivated by control, better forecasts
  • Top Down
    • More vision at the top, more coordination
planning process
Planning Process
  • Set Deadlines / Initiate Process
  • Gather Data
  • Analyze Data / Situation Assessment
  • Make Plans & Forecasts
  • Refine Plan
  • Management Approval
  • Disseminate, Monitor & Control

Assess Situation

Consider Company Goals

Set Measurable Objectives

Develop Strategies, Action Plans,

Responsibility Assignments, and Due Dates

Evaluate Programs Against Objectives



Draft Marketing Plan

Compare Programs to Resources



Submit Plan for Approval


Not Approved


Source: Conference Board

the marketing plan
The Marketing Plan
  • Where are we now?
  • Where do we want to be?
  • How do we get there?
marketing plan
Marketing Plan
  • Executive Summary
  • Situation Analysis
  • Marketing Objectives
  • Strategy and Tactics
  • Monitors and Controls
  • Financial Documents
situation analysis
Situation Analysis
  • Review of Status and Future Outlook
    • Not just data, but implications
    • Brevity, prioritization of information
    • Diagnostic, not descriptive
    • Contains:
      • Category Analysis and Forecast Trends
      • Sales Analysis
      • 3 C Analysis
      • Planning Assumptions
      • Summary (Problems and Opportunities)
  • “If you don’t know where you want to go, any road will take you there”
  • Precise, with dates and numbers
  • Sales, profits, share, etc.
  • Measurable and achievable
  • Subsequent strategy and tactics must demonstrate compliance with objectives
strategy and tactics
Strategy and Tactics
  • Strategy is means to accomplish goal, e.g., awareness goal will be met by advertising
  • Tactics pertains to the implementation, e.g., media schedule, agency, message, etc.
    • how to, by whom, by when, with what resources
monitors and controls
Monitors and Controls
  • 74% of consumer product firms have explicit sales promotion tactics
    • Only 36% monitor
  • 69% of industrial firms have explicit sales tactics
    • Only 46 % monitor
  • Only 1 in 4 firms has a contingency plan
    • Both good and bad events (e.g., competitor merges or leaves)
    • What ifs and appropriate trigger points

Source: Conference Board

  • Goal: Provide context for plan
    • 20% plan, 5% performance
    • Assignment detailed on website
  • Goal: More experience in decision making
  • More brand oriented than Markstrat
    • More promotion and advertising decisions, less production
    • Play against pc, not classmates
  • Overview of Market
    • 250MM Persons (1% Growth /Year)
    • 2% GNP Growth
    • Moderate Inflation
    • 80% of Population Suffers from Colds
    • OTC Market is $2BB Growth 4% / Yr
    • Manufacturer Sales = $1.5BB
    • Five companies
    • Capacity adjusts automatically to demand
pharmasim market
PharmaSim Market
  • Competition
    • Four competitors (B, C, D, and E)
  • Four Trade (not Consumer) Categories
    • Cold, nasal, cough, and allergy
  • Brands Have Five Attributes
    • Symptoms relieved, side effects, form (capsule, liquid, spray), duration of relief, and price
pharmasim consumers
PharmaSim Consumers
  • Buying behavior varies with
    • Illness/symptom (cold, cough, allergy), age, and usage occasion (day or night, work or home)
    • Thus, can segment by illness, age, or usage
    • Note: mfg. sales study (pre-defined category)  consumer survey (usage)
  • Buying process
    • Awareness  Purchase Intention  In Store Attractiveness  Purchase Usage Satisfaction  Repurchase
pharmasim channel
PharmaSim Channel
  • Through Wholesale or Direct to:
pharmasim decisions
PharmaSim Decisions
  • Pricing
    • MSRP
    • Trade
      • <250 Units, <2500 Units, >2500 Units
      • Wholesale
  • Salesforce Size
    • Direct (By Channel)
    • Indirect (Wholesale, Merchandisers - Retail Sales Support, Detailers for M.D.’s)
pharmasim decisions1
PharmaSim Decisions
  • Advertising
    • Targeting
      • Segments (By Age and Usage)
      • Agency
      • Budget
    • Message
      • Message (primary demand, benefits, competitive comparison, or reminder message)
      • Benefits (e.g., aches, congestion, etc.)
pharmasim decisions2
PharmaSim Decisions
  • Trade Promotions
    • Allowances (% of MSRP by channel)
    • Co-op Ads (total $ and which channels)
  • Consumer and Trade
    • POP ($ and which channels)
    • Trial Size ($)
    • Coupons ($ and face value)
pharmasim decisions3
PharmaSim Decisions
  • Product
    • Reformulation - before decision 2
    • Line extension - before decision 4
    • New product - before decision 5
    • Your own product - before decision 8
pharmasim tips
PharmaSim Tips
  • Please review tips on website (link from syllabus)
  • Read pages 5-66 carefully. E.g., buried on page 66 is the statement that FC continue when product is dropped. Important, but easily missed. Other examples abound.
other pharmasim tips
Other PharmaSim Tips
  • Think analytically
  • Sales = Share * Market Size
    • Share = f (marketing $ and quality, value/price, synergies among marketing activities, fit with segments selected, positioning relative to competition)
    • Size = f(population, needs, available product benefits, industry marketing $ and quality, product life cycle)
more tips
More Tips
  • Marketing $ can interact
    • Deals more effective with ads
  • Stockpiling is possible
  • Understand the role of channel and how to motivate
  • Think about the ramifications of your strategies
    • A leading brand (Allround) should never run comparison ads against a niche brand (Coughcure)
    • Line extensions do not need the same marketing $ as new brands
  • Allocate marketing $ to area with highest returns
  • Key opportunity is chance to introduce new product into a market with a real need (e.g., Allright Allergy).
    • Shift resources to new product
one last tip
One Last Tip
  • Cost dynamics, margin management, value based pricing, and capacity utilization are essential to profitability.
marketing plan assignment
Marketing Plan Assignment
  • The assignment is detailed on the website and linked to the syllabus.
  • First move of Pharmasim should take 2 hours. Then, about 1 hour + for the remaining 7 moves for a total of 10 hours. Harvard runs 10 moves in 24 hours period.
marketing plan assignment1
Marketing Plan Assignment
  • Three parts (4 pages & Exhibits)
    • Situation analysis
    • Marketing program and financials
    • Executive summary, contingencies, and post-mortem
  • 3 reports = 20% , performance = 5%
  • Please turn in copy of diskette and administrator report with the first two parts
  • Note: marketing planning (although not handed in) should occur each period of PharmaSim!
marketing plan assignment2
Marketing Plan Assignment
  • Marketing plans represents 20-30% of what you will do.
  • Daily product management is the other 70-80%.
  • This Assignment aligns with both.
  • Marketing Plan
    • Executive Summary
    • Situation Analysis
    • Marketing Objectives
    • Strategy and Tactics
    • Monitors and Controls
    • Financial Documents
  • PharmaSim is Vehicle for Plan