Long Range Planning: Terminology

Long Range Planning: Terminology
Kotler describes the function of the mission statement, the start of the now traditional approaches to corporate planning, thus:

A well worked-out mission statement provides company personnel with a shared sense of opportunity, direction, significance and achievement.

The company mission statement acts as an ‘invisible hand’ that guides geographically scattered employees to work independently and yet collectively toward realizing the organization’s goals.

Goals he describes even more succinctly:
....indicates what the business unit wants to achieve in the planning period.

Goals and objectives often have the same meaning. Kotler stresses that as far as possible they should be quantitative and realistic.

Strategy is about how goals are to be achieved:
Goals tell where a business wants to go; strategy answers how it plans to get there. Every business must tailor a strategy for achieving its goals. The strategy must then be refined into specific programs that are implemented efficiently and corrected if they are failing to achieve the objectives.

This quotation for Kotler also illustrates what is involved in the implementation of programs or tactics, which in turn lead to short term plans with a number of targets being set.

These terms can helpfully be thought of reference to a single factor: time.

The mission is the description of the main, permanent values which ultimately motivate the organization.

Goals or objectives specify where the organization wants to be in the future.

Strategy is the broad course of action planned to enable the organization to achieve its goals. Tactics are the specific programs of activities needed to implement the strategy in the shorter term (typically within the annual budgetary cycle).
Long Range Planning: Terminology

Advertising, what it can and cannot do

Advertising, what it can and cannot do
Popular opinion often credits advertising with a wider range of effects than is reasonable.

In fact its key characteristics, that it delivers massages via advertising media, means it has a more distant relationship with its target audience than do several of its relatives in the marketing communications mix.

As a result, it is unlikely to be able to clinch a sale, except in the special case of direct response advertisements. A more realistic role is longer term brand-building, which it can do by:

• Building awareness
• Conveying information
• Telling a story
• Establishment an identity
• Creating a predisposition

These are, of course, generalized common aims; more specific objectives must be set for individual advertising campaigns.

In practice those all too often include the requirement to ‘increase sales’ within the period of the campaign, which is normally comparatively short-term.

Such an objective typically places an unfair burden on advertising management and advertising agencies by ignoring:

• The crucial gap between responding favorably to advertising and being persuaded to take up the product.
• The time lag between being convinced and deciding to act accordingly
• The concurrent positive or negative affects of the advertiser’s decisions about other elements of the marketing mix, such as price
• Entirely external; determinants, such as personal economics, social norms or the activities of the advertiser’s competitors
  

Advertising, what it can and cannot do

The Selling Concept

The Selling Concept
Selling concepts holds that consumers if left alone, will ordinarily not buy enough of the organization’s products. The organization must therefore undertake an aggressive selling and promotion.

The concept assumes that consumers typically show buying inertia or resistance, and have to be coaxed into buying, and that the company has available a whole battery of effective selling and promotion tools to stimulate more buying.

The selling concept is more practice most aggressively with “unsought goods,” those goods that buyers normally do not think of buying such as insurance, encyclopedia, and funeral plots.

These industries have perfected various sales techniques to locate prospects and hard sell them on the product benefits.

The selling concept is also practice in the non-profits area by fund raisers, college admission offices and political parties.

For examples, a political party may campaign aggressively to win an election.

Heavy advertising, numerous speeches and door to door visits may be used to promote its candidate while hiding their flaws.

After winning the party may take a sales oriented view by trying to get its citizens to accept its policies rather than to find out what voters really want.

Most firms practice the selling concept when they have overcapacity. Their aim is to sell what they make rather than make what the market wants.

In modern industrial economics, productive capacity has been built up to a point where most markets are buyer markets (that is buyers dominants) and sellers have to scramble hard for customers.

Prospects are bombarded with television commercials, news paper ads, direct mail and sales calls. At every turn, someone is trying to sell something. As a result, the public identifies marketing with hard selling and adverting.
The Selling Concept