Assignment:
You're part of the marketing department at Cemex, a global provider of building materials. Your have been called to a meeting at the Monterrey, Mexico headquarters with members of several other departments, and Cemex's CEO, Oswaldo Villalobos. "I just reviewed last quarter's sales figures," Villalobos says, "and I'm not happy. Profits are down in North America."
Villalobos continues: "I've called this meeting because I'd like you to form a cross-functional business development team to focus on expanding our US operations. We know that spending on infrastructure is increasing," he says.
Villalobos is referring to a large infrastructure package recently signed by the new US administration. You have just discussing the news over coffee yesterday morning.
The plan includes funding for bridges, roads, and sewage systems. There's no question that US infrastructure spending will be up in the coming years.
"We're well-positioned to grab a bigger market share of the cement business," Villalobos says. "Cemex has mothballed capacity that we should tap into."
Villalobos looks at your group: "Report back to me in four weeks with a detailed marketing plan for this expansion. Include the steps to implement the plan along with the control measures to ensure that our forecasted sales targets are met."
As you learned one of the most important functional areas in business is marketing. Companies such as Airbus, Peugeot, GM, Burger King, and Tata have a passion for understanding their customers and satisfying their customers' needs in "well-defined target markets" (Kotler & Armstrong, 2014, p. 4). Marketing is a managerial and social function through which companies and customers create and exchange value. The authors define marketing as the "process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return" (p.5).
B2B Buying Decisions
When it comes to business buying behavior, business customers and their suppliers explore different avenues to manage relationships and enhance efficiency and effectiveness. Closer relationships are partially driven by purchasing alliances, supply chain management, and early supplier involvement. Fostering the right relationship with businesses is crucial for any holistic marketing plan. Vertical coordination between the sellers and their business customers allows them to go beyond simple transactions to engage in activities that create value for both parties. Trust and knowledge are key to the success of business-to-business (B2B) relationships. B2B relationships are impacted by supply, complexity of supply, availability of alternatives, and supply market dynamism (Kotler & Keller, 2015).
Strategic Alliances
An emerging theme in organizational systems in the twenty-first century is an increased use of long-term global strategic alliances. Organizations form these alliances in an effort to secure commercial advantage and eliminate waste from their distribution channels. Choosing the right partners for global strategic alliances is crucial for success, but it can be a complex process. Organizations should identify and define the criteria for partner-selection prior to forging the alliance (Wu, Shih, & Shan, 2009). Cemex may consider forming strategic alliances to expand its US operations. These alliances can be with other producers or with distribution companies; a good example is the alliance between Nissan (a Japanese auto company) and Renault (a French auto company), with Carlos Ghosn serving as chairman and CEO of the alliance.
To carry out this assignment, your marketing needs to understand Cemex's customers, how to acquire market knowledge (through primary and secondary research), and how to turn that knowledge into products that are needed and wanted by a group of customers. You must also be able to invent market offerings that not only create value for the customer, but also create profitability for Cemex in a socially responsible and ethical way.
As you will recall, there are two types of market research: primary and secondary research. Both types of research are necessary when creating a marketing plan.
Now that you have read the introduction to B2B marketing, continue to the next step, where you will begin to learn about the components of a marketing plan.
References
Kotler, P. & Armstrong, G. (2014). Marketing management (15th ed.). Upper Saddle River, NJ: Pearson.
Kotler, P., & Keller, K. (2015). Marketing management (15th ed.). Upper Saddle River, NJ. Pearson
Wu, W. Y., Shih, H., & Chan, H. (2009). The analytic network process for partner selection criteria in strategic alliances. Expert System with Applications, 36(3), 4646 - 4653. doi: 10.1016/j.eswa.2008.06.049
The marketing team's marketing knowledge and data acquisition skills are crucial to the success of this project. You will collect and analyze the information necessary to develop a marketing plan for Cemex in the United States. The marketing plan is a written document that outlines the marketing program, along with the promotional budget allocation over the planning period. In other words, your marketing plan details what is needed to implement your marketing program and achieve its goals. When developing your marketing plan, you should first review vision and mission statements and then research Cemex's vision and mission statements.
It is important to note that a marketing plan is not the same as a business plan. While the marketing plan is part of the business plan, business plans typically also include additional information such as financial strategies, operations, risk management, and human resources. Use this marketing plan template to help you create your marketing plan.
Now that you understand the components of a marketing plan, continue to the next step, where you will learn about Cemex and the cement industry.
The marketing team's marketing knowledge and data acquisition skills are crucial to the success of this project. You will collect and analyze the information necessary to develop a marketing plan for Cemex in the United States. The marketing plan is a written document that outlines the marketing program, along with the promotional budget allocation over the planning period. In other words, your marketing plan details what is needed to implement your marketing program and achieve its goals. When developing your marketing plan, you should first review vision and mission statements and then research Cemex's vision and mission statements.
It is important to note that a marketing plan is not the same as a business plan. While the marketing plan is part of the business plan, business plans typically also include additional information such as financial strategies, operations, risk management, and human resources. Use this marketing plan template to help you create your marketing plan.
Now that you understand the components of a marketing plan, continue to the next step, where you will learn about Cemex and the cement industry.
As a part of the preparation necessary to complete your business-to-business marketing plan, you will need to do in-depth research on Cemex, its operations, global reach, and product range. Start by reading Cemex and Cement Industry Background, and be sure to consider the following questions while you do additional web research:
Where are the company's production facilities located?
What is Cemex's annual turnover in dollars and what is its annual production in tons?
How does Cemex differentiate its offering in a market where cement is a commodity?
Are there differences in product quality?
Who are the major global and US customers?
What benefits does Cemex offer to its customers?
Describe these benefits and tie them to your value proposition. A value proposition is essentially the promise that is made to the customer. The value proposition should be included in your report. Who are the major global and US competitors?
1: Write a two-page overview explaining your findings on Cemex and be sure to include your value proposition.
This overview will be incorporated into your B2B marketing plan later in this project, along with milestones from the upcoming steps. In the next step, you will take a comprehensive look at the many factors that you need to consider, exploit, or defend against in your plan.
As a member of Cemex's marketing team, you use quantitative and qualitative market information to make important decisions. Your team will use the following tools to conduct an environmental scan:
PESTEL analysis: A PESTEL analysis (sometimes called PEST analysis) enables Cemex to identify, analyze, and monitor the political, economic, social, technology, legal (including regulatory), and environmental factors that may impact its operations (Frue, 2017).
Porter's five forces analysis: Porter's five forces analysis is a framework that can help Cemex understand the competitive forces at play in its industry. These forces may impact how economic value is divided among Cemex's competitors in the industry (Porter, 2008).
SWOT analysis: A SWOT analysis is a planning and brainstorming tool that helps Cemex evaluate its projects and formulate its business plans. SWOT stands for strengths, weaknesses, opportunities, and threats. Cemex uses this tool to identify and analyze its internal strengths and weaknesses, as well as its external opportunities and threats. The results of this analysis may help Cemex improve its business, or forecast how a new product will perform (Harmon, 2016).
Research the cement industry (domestic and international), research market trends, and identify market opportunities, threats, and Cemex's major global competition. Conduct a situation analysis including an internal analysis of Cemex, customer analysis, and an analysis of the macro-environment (external environment). Which elements have the biggest impact on Cemex's success? What factors impact Cemex's business buyers?
Go to the UMUC Library>Research Guides and select the following two research guides: Business and Management and Marketing. Read these research guides. Find and print articles that will help you complete your assignments. It is easier if you conduct a separate search for each section of your marketing plan. Also, use the industry/company databases, such as Moody's, to research Cemex and the cement industry.
2: Conduct the following three analyses for Cemex: PESTEL analysis, SWOT analysis, and Porter's five forces analysis. Present your results in a four-page report (excluding cover page, reference list, tables, graphs, and/or exhibits). Be sure to support your work with scholarly sources, and reliable nonscholarly sources (such as Bloomberg, Yahoo! Finance, Money, Forbes, Fortune, and Harvard Business Review)
These analyses will provide critical information for your B2B marketing plan. In the next step, you will begin to focus on a specific market.
References
Frue, K. (2017). Why do PEST analysis for your business? Retrieved from https://pestleanalysis.com/
Harmon, A. (2016). SWOT analysis. Salem Press Encyclopedia [online]. Retrieved from Research Starters, Ipswich, MA. Accessed February 24, 2017.
Porter, M. E. (2008). The five competitive forces that shape strategy. Harvard Business Review, 86(1), 78-93.
Now that the environmental scan has been completed, the marketing team needs to conduct an analysis of US cement customers. Outline how the team would conduct this analysis, while considering both current and potential product users. Your analysis should address how you would determine answers to the following questions:
What needs are being met by the cement purchase? What are the benefits to the customers? Make sure that you differentiate between features and benefits; go beyond manifest motives and consider latent motives.
Who is involved in the cement purchase process? Who are the influencers, buyers, and users?
Where is cement sold (i.e., distribution channel)?
How often are the different types of cement purchased? Is there seasonality to sales?
Is there any market regulation or self-regulation?
3: Present your results in a three-page report (excluding cover page, reference list, tables, graphs, and/or exhibits). Be sure to support your work with scholarly sources, and reliable nonscholarly sources (such as Bloomberg, Yahoo! Finance, Money, Forbes, Fortune, and Harvard Business Review)
This report should help you develop focus in your marketing plan. In the next step, you will consider exactly what you hope to accomplish with your B2B marketing plan.
As a marketing team, you need to decide on your marketing objectives before you develop your complete Cemex marketing strategy. Marketing objectives are usually described in terms of sales (both in units or dollars) and market share, and should include the US markets you intend to enter or expand into. Knowing exactly where you want to go is essential in deciding how to get there. The objectives have to be measurable, specific, and have a set time limit. Be careful not to have too many objectives, since a limited number of objectives will help you focus. The objectives should be challenging, but achievable.
4: Prepare a one-page document outlining your marketing objectives.
Once your marketing objectives are written, you will begin to examine your market and determine how Cemex can meet these objectives.
The first step in developing a marketing strategy involves segmenting, targeting, and positioning (STP).
Segmenting refers to breaking the US cement market down into homogenous groups. Targeting refers to selecting the customer groups(s) that you will focus your marketing efforts on. The appropriate segmentation variable is dependent on the needs and wants of customers. These decisions are directly tied to your value proposition and require extensive marketing research on the customers. Once the segmentation variable is determined and the target markets selected, you need to develop the positioning strategy, which refers to the way you want the customer to view the product relative to the competition.
Describe the market research you would conduct to analyze and segment the US cement market. Explain how you would select your target cement markets, and explain the process of positioning Cemex's cement products relative to the competition.
5: Detail your STP strategy in a three-page paper (net), not including the cover page, references, graphs, or tables/figures. Support your arguments using a mix of scholarly and reliable nonscholarly sources. All sources need to be cited using APA formatting; both within the text and in the reference list. The paper should be organized using headings and subheadings to improve its readability.
Your overall STP strategy is important, because it will create a foundation for the refinements you will make in the next step.
Develop your Cemex marketing strategy based on your STP strategy. Remember that these decisions are interdependent, and are part of a whole. Follow the sequence outlined in the marketing plan template.
First you will want to consider Cemex's product or brand strategy. Describe the needs/wants of your target cement customer(s), and how you intend to position Cemex versus the competition. Present a detailed description of the different types of cement that you intend to sell in the US market, including their attributes, features, and quality level, along with the brand names, intended packaging, logo, and supplemental products. As you make these branding strategy decisions, it is imperative that you stay focused on the customer. Remember that Cemex's customers do not buy features; they buy benefits, both tangible and intangible. It is also critical to understand the customer: Think about who makes the cement purchase and who influences that decision, etc.
Next, you will want to think about pricing strategy. Pricing is very strategic as it is the only marketing mix variable that generates income. As a marketing team, you need to decide on your price objectives and strategies. Think about pricing tactics like discounts and incentives. You need to decide whether your pricing strategy should be skimming, premium, or market penetration given the nature of the cement products, your customers, and your major competition. Profit margins and the breakeven analysis will also need to be considered. As you determine your final price points, you'll need to consider the perceived value of your cement products. Describe how you would go about making these decisions, and the major issues involved.
Then you will need to consider Cemex's distribution and supply chain strategy. Remember, cement is a heavy and bulky product, and there are a lot of issues involved in delivering it to the final user. These strategic decisions deal with how customers purchase cement. Will you market the cement directly to your customers or through distributors/wholesalers (intermediaries)? Will you follow an exclusive, selective, or intensive distribution? Distribution decisions focus on marketing channels, as well as the physical distribution of the cement. Explain the criteria you would use to make these distribution and supply chain strategy decisions.
Finally, you should consider your integrated marketing communications and promotion strategy, which is often the most visible element of a marketing strategy. Cemex's communication strategy involves developing an integrative mix of a number of different tools at your disposal, while keeping in mind the needs and characteristics of the target cement market(s). These tools may include a mix of traditional communication elements such as advertising, personal selling, sales promotion, and publicity/public relations. It is essential that your promotion objectives are clearly defined, and that a holistic and integrated marketing communication approach is used.
6: Prepare a four-page report outlining your marketing strategy.
It's almost time to start crunching the numbers that will further justify your overall strategic goals. You will do this in the next step.
Your financial analysis should include the total number of units produced annually, average unit cost, total annual costs (Average unit cost X Number of units produced), average unit price, annual sales (Average unit price X Total number of units sold), and a breakeven analysis.
In addition, explain your schedule for implementation, the controls you intend to put in place, and how you intend to proceed (i.e., contingency plans) when your benchmarks are not met.
7: Prepare a two-page report explaining your financial analysis and implementation. Be sure to support your work with scholarly sources and reliable nonscholarly sources (such as Bloomberg, Yahoo! Finance, Money, Forbes, Fortune, and Harvard Business Review)
In the next step, you will combine the work from this step with all previous milestones to create your complete marketing plan.
Now create your final graded deliverable, combine the work from each milestone in this project into one complete paper. Use the structure outlined in the marketing plan template. Edit the document to ensure that there is clear flow from one section to the next. In addition, prepare a one-page executive summary (included in the page count) that highlights the most important aspects of your marketing plan. Follow APA style for the text citations and reference list.
The paper should be 20-22 pages (net), not including a cover page, table of contents, and appendices, graphs, tables/figures, and references. The paper should use size 12 font, have one-inch margins, and should be double spaced. Submit your group's marketing plan to the assignment folder below
Before you submit your assignment, review the competencies below, which your instructor will use to evaluate your work. A good practice would be to use each competency as a self-check to confirm you have incorporated all of them in your work.
Organize document or presentation clearly in a manner that promotes understanding and meets the requirements of the assignment.
Provide sufficient, correctly cited support that substantiates the writer's ideas.
Tailor communications to the audience.
Create neat and professional looking documents appropriate for the project or presentation.
Create clear oral messages.
Identify and clearly explain the issue, question, or problem under critical consideration.
Locate and access sufficient information to investigate the issue or problem.
Identify numerical or mathematical information that is relevant in a problem or situation.
Lead and/or participate in a diverse group to accomplish projects and assignments.
Demonstrate the ability to plan and execute a project, articulating clear objectives and goals for the team.
Contribute to team projects, assignments, or organizational goals as an engaged member of a team.
Demonstrate diversity and inclusiveness in a team setting.
Identify the general (external) environment in which an organization operates and discuss the implications for enterprise success.
Evaluate strategic implications for domestic and international markets of an organization's industry.
Analyze an organization's internal strengths and weaknesses for strategic value.
Develop and recommend strategies for an organization's sustainable competitive advantage.
Develop operating forecasts and budgets and apply managerial accounting techniques to support strategic decisions.
Assess market risk and opportunity.
Analyze marketing information.
Prepare marketing plan for a new product/service.
Identify and analyze new opportunities.
Create and implement new initiative or enterprise.