Principles of Marketing, Week 1
Principles of Marketing, Week 1 MARK 220-01
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This 0 page Class Notes was uploaded by Asli Acar on Wednesday January 20, 2016. The Class Notes belongs to MARK 220-01 at Georgetown University taught by Simon Blanchard in Spring 2016. Since its upload, it has received 57 views. For similar materials see PRINCIPLES OF MARKETING in Marketing at Georgetown University.
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Date Created: 01/20/16
Company and Marketing Strategic Planning Strategic planning is the process of developing and maintaining a strategic fit between the organization s goals and objectives and its changing marketing opportunities 1Define the organization s mission 0 What is our business 0 Who is our customer 0 What do our customer s value 0 What should our business be Mission Statement A statement of the organization s purpose what it wants to accomplish in the larger environment 0 Market oriented and based on satisfying customer needs 0 Meaningful and specific yet motivating 0 Emphasizes the company39s strengths in the market 0 Should NOT be stated in terms of sales or profits Compan y Productoriented Mission Marketoriented Mission We connect people around the world and help them share important moments in their lives They try to create an environment that will connect people Facebook We are an online social network Revlon We make cosmetics We sell lifestyle and self expression Coca We refresh the world by inspiring moments We make beverages Cola of opt1m1sm and happmess We produce photography equipment We help people easily and quickly record Kodak cameras lms and photo prmters the1r memorles It is about the needs that the companies are satisfying Starbucks doesn t even name coffee in their mission The best mission statements re ect an external focus on customer needs not an internal focus on the company s current offering Marketing myopia Defining the company s mission too narrowly can cause managers to miss opportunities for growth Under Armour39s and Nike s mission is very different even though they are both sports brands Under Armour s mission is to make all athletes better through passion design and the relentless pursuit of innovation Every Under Armour product is doing something for you it39s making you better While Nike is trying to encourage everyone who has a body to be an athlete and buy their products 2 Set objectives 0 SMART objectives what the firm hopes to accomplish within a specific time frame 0 Specific 0 Measurable 0 Attainable 0 Relevant 0 Time bound 0 Organizational objectives should be consistent with and support the realization of the company s mission 0 Objectives are not always monetary Area of Performance Possible Objectives Profitability Achieve an annual rate of return on investment of at least 15 Market Share To make our brand 1 in terms of market share within 5 years Innovation To double the number of transistors on our CPUs within2 years Worker Performance and attitude To increase employee satisfaction by 20 this year 3Establish the business portfolio In designing their business portfolios companies must 0 Analyze their current portfolio or strategic business units SBUs and decide which SBUs should receive more less or no investment 0 Develop strategies for growth and downsizing that will shape the future business portfolio Strategic business unit SBU A relatively autonomous division of a company that operates as an independent enterprise with responsibility for a particular range of products or activities An SBU can be a company division a product line within a division or a single product or brand Portfolio analysis The process by which management evaluates the products and businesses making up the company Resources are directed toward more profitable businesses while weaker ones are phased out or sold BCG GrowthShare Matrix 0 The Boston Consulting Group BCG growth share matrix is a portfolio planning tool for assessing and prioritizing SBUs 0 Focuses on the potential for existing products to generate cash that the firm can use to invest in new or existing products 0 Two dimensions 0 Market growth rate market attractiveness 0 Relative market share competitive strength Stars 53le whose products have a dominant market share in highagmw th markets High Dog39s An SBU nobody wants Market Growth Rate low H ig h Low Relative Market Share SBU Strategy Stars Build into cash cow via investment Cash Cows Maintain or harvest for cash to finance new stars Question Build into stars via investment OR reallocate funding and let become Marks dogs Dogs Maintain or divest Iphone CashCow Ipad CashCow Mac CashCow AppleTv Question Mark Ipod Dogs Limitations of BCG Matrix 0 Assumptions about dimensions 0 Growth rate Market attractiveness 0 Relative market share Competitive strength 0 It can be hard to obtain reliable measures of market share and growth 0 Assumes growth is uncontrollable 4Develop growth strategies Companies must grow to 0 Compete more effectively 0 Satisfy their stakeholders 0 Attract top talent Marketing shoulders the responsibility for achieving and managing profitable growth Product VIarket Expansion Grid Product Emphasis Existing Products New Products Strategy 2 Market 7 penetration ExIStmg I Seek to increase Markets to 7 7 sales of exustwngi products to Market existing markets Emphasis Strategy Diversification New 1 Markets a Emphasize both new precincts and new markets to achieve growth Market Penetration Increasing sales of current products to current market segments Encourage people to spend more buy more toothpaste Encourage non users in the target market to buy Selling current products to new customer segments 0 Common tactics 0 Communicate different usesbenefits of the product 0 Advertise in different media 0 Add channels of distribution 0 Expand geographically Off Label Drugsl propecia Viagra Product Development Selling new products to current market segments 0 Offer new variations of the same product 0 E g Mini Oreo s Pretzel MampM s seasons 0 Some tactics 0 Planned obsolescence 0 Fashion Diversification 0 Starting up or buying business outside of the firm s current products and consumer segments 0 Some tactics 0 Acquisitions eg McDonalds purchased Aroma Cafe and Boston Market Sara Lee purchased Coach Leather Products Altria purchased Post Cereals Kraft Cheese etc Under Armour 0 Option 1 Changing the product positioning of its current products to a fashion brand 0 Option 2 maintaining focus on performance apparel to be worn by athletes 0 Option 3 developing a line of professional fitness equipment Common Tactics Increase advertising Cut price sales promotion Frequent shopper programs Increase distribution
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