Strategic planning is an essential marketing process that businesses must undertake if they wish to be successful. The company must establish its overall goals, while creating a strategy that will allow them to balance these goals with their capabilities and the opportunities available in the market. In addition, by creating and expanding the company’s business portfolio, the operations within the company are diversified and increase the likelihood of a profitable business.
The first thing a business needs to do during their strategic planning phase is creating the company goals. The most important question that needs to be addressed is determining what goods or services the company will offer. Additionally, the business must decide who their key customer group will be and understand what they value in a product. At this point, the mission statement of the company is established, detailing the overall plan for the company.
The next thing that a company needs to due during its strategic planning process is create the business portfolio. A business portfolio is a compilation of various products the company offers to its consumers. Typically, new companies start with a small number of their basic offerings, expanding if the business is deemed profitable. The portfolio needs to be constantly analyzed in order to ensure the products offered are good for the company. In addition, planning to enter new niche markets in the future is essential to remain competitive.
Breaking the Current Market Up
A common method of analyzing a business portfolio involves breaking up the current market into four sections: product development, market penetration, market development, and diversification. Product development is useful when creating a product that already has an established marketplace. If competitors are already offering successful products, it makes sense for a new company to enter the marketplace with their own similar product. Market penetration helps strengthen a business portfolio for products a company already makes. During this phase of marketing, a company must determine how to persuade consumers to purchase their products instead of choosing a competitor. Market development improves a company’s business portfolio by establishing new areas in which their products fill a void. While this can be risky since it may or may not be popular with customers, it can also be extremely profitable due to the lack of competition. Finally, diversification improves a company’s overall business portfolio by expanding the company’s overall focus. This includes entering markets entirely unrelated to their current product offerings.
Finally, the final key step in the strategic planning marketing process is creating a marketing strategy. Usually, this is first done by segmenting the market into smaller sections, placing potential customers into different groups. This is then followed with a targeted marketing approach to reach these various groups. Companies choose which segments of the market to focus on in order to create the most profitable campaign. Additionally, a company must constantly monitor its positioning in the market to see what their consumers think of their brand.