Chapter 2 80302 - MKT 3010 - 002
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80302 - MKT 3010 - 002
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Popular in Marketing
80302 - MKT 3010 - 002
verified elite notetaker
This 6 page Class Notes was uploaded by Nicole Dunne on Wednesday September 2, 2015. The Class Notes belongs to 80302 - MKT 3010 - 002 at Clemson University taught by Carter Willis McElveen in Summer 2015. Since its upload, it has received 21 views. For similar materials see Principles of Marketing in Marketing at Clemson University.
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Date Created: 09/02/15
Chapter 2 Developing a Marketing Strategy and a Marketing Plan 0 A marketing strategy identi ed a rm s target markets a related marketing mix 4 P s and the bases on which the rm plans to build a sustainable competitive advantage 0 A sustainable competitive advantage is an advantage over the competition that is not easily copied d thus can be maintain over a long period of time 0 Customer excellence focuses on retaining loyal customers and excellent customers service Nordstrom Retaining loyal customers strong brand unique merchandise and superior customers service View customers with a lifetime value perspective rather than a transactionbytransaction Customer Service once a marketer has earned a good service reputation it can sustain this advantage for a long time because a competitor is hard pressed to develop a comparable reputation 0 Operational excellence achieved through ef cient operations and excellent supply chain and human resource management Firms with strong relationships may gain exclusive rights to sell merchandise in a particular region obtain special terms of purchase that are not available to competitors or receive popular merchandise hat may be in short supply Net ix 0 Product excellence having products with high perceived value and effective branding and positioning Investing in their brand itself positioning their product or service using a clear distinctive brand image and constantly reinforcing that image Google McD Coke o Locational excellence having a good physical location and Internet presence Location location location Starbucks 0 Multiple Sources of Advantage needed to build a sustainable competitive advantage 0 The marketing plan written document composed of analysis of the current marketing situation opportunities and threats for the rms marketing objectives and strategy speci ed in terms of the four P s action programs and projected or proforma income statements 0 Planning Phase Step 1 o The mission statement a broad description of a rm s objectives and the scope of activities it plans to undertake o Attempts to answer two questions What type of business are we What do we need to do to accomplish our goals and objectives 0 These fundamental questions must be answered at the highest corporate levels before marketing executives can get involved 0 Maximize stockholders wealth by increasing the value of rms stock and playing dividends 0 Marketing myopia de ning a business in terms of goods and services rather in terms of the bene ts that customers seek Planning Phase Step 2 o Firm should perform a situation analysis using a SWOT analysis that assesses both the internal environment with regard to its Strengths things company does well Weaknesses things company does not do well Opportunities conditions in the external environment that favor strengths Threats conditions in the external environment that do not relate to existing strengths or favor areas of current weakness 0 Environmental Scanning helps identify opportunities and threats 0 Guidelines for designing marketing strategy based on 6 macroeconomic forces cultural demographic social technological economic and political Planning Phase Step 3 Identifying and Evaluating Opportunities using STP o STP segmentation targeting and positioning the processes of segmentation targeting and positioning that rms use to identify and evaluate opportunities for increasing sales and pro ts Segmentation 0 Market segment consisting of consumers who respond similarly to a rm s marketing efforts 0 Market segmentation the process of dividing the marketing into groups of customers with different needs wants or characteristicswho therefore might appreciate products or services geared especially for them Which segments of customers can you satisfy Evaluation of each segments attractiveness How are you positioning the product within the target segments Targeting Target marketingtargeting the process of evaluating the attractiveness of various segments and then deciding which to pursue as a market Positioning Marketing positioning involves the process of de ning the marketing mix variables so that target customers have a clear distinctive desirable understanding of what the product does of represents in comparison with competing products Firms are most successful when they focus 0 opportunities that build on their strengths relative to those of their competition 0 Planning Phase Step 4 Implement Marketing Mix and Allocate Resources 0 Implement the 4 P s 0 Product and Value Creation Products which include services constitute the rst of the four P s Because the key to the success of any marketing program is the creation of value rms attempt to develop products and services that customers perceive as valuable enough to buy Costbased pricing Competitor based pricing Valuebased pricing 0 Price and Value Capture Value based marketing requires rms to charge a process that customers perceive as giving hem a good value for the product they receive 0 Place and Value Delivery 0 Must be able to make the product or service readily accessible when and where the customer wants it 0 Promotion and Value Communication 0 Communicate to their customers through mediaTV radio magazines sales forces and daily internet 0 Planning Phase Step 5 Evaluate Performance Using Marketing MetricsMake Adjustments o A metric is a measuring system that quanti es a trend dynamic or characteristic 0 Metrics are used to explain why things happened and to project the future 0 Who is accountable for Performance At each level of an organization the business unit and its manager should be held accountable only for the revenues expenses and pro ts that they control The metrics sued to evaluate a rm vary depending on 1 the level of organization which the decision is made and 2 the resources the manager controls Performance Objectives and Metrics Compare a rm s performance over time or to competing rms sing common nancial metrics such as sales and pro ts View the rm s products or services as a portfolio Financial Performance Metrics Commonly used metrics to assess performance include revenues sales and pro ts Sales are a measure of a rm s activity level Portfolio Analysis Management evaluates the rm s various products and businesses its portfolioand allocates resources according to which products are expected to be the most pro table for the rm in the future Strategic business unit SBUproduct line division of the rm itself that can be managed and operated somewhat independently from other divisions and may have a different mission or objectives Goodyear tires are organized by NA Europe Middle East Africa Latin America and AsiaPaci c A product line is a group of products that consumers may use together or perceive as similar in some way Goodyear s ling of product could be a car van SUV and light truck while another line could be racing tires or aviation tires Market share is the percentage of market accounted for by a speci c entity and is used to establish the product s strength in a particular market Usually discussed in units revenue or sales Relative market share a measure of the product s strength in a particular market de ned as the sales od the focal product divided by the sales achieved by the largest rm in the industry Market growth rate the annual rate of growth of the speci c market in which the product competes HIGH Growth Strategies RELATIVE MARKET SHARE O 0 High market growth high market share Cash neutral require a heavy resource investment in such things as promotions and new production facilities to fuel their rapid growth Ex MySpace Start off great then can t maintain Cash Cows O O O 0 Low market growth low market share Cash generating Received heavy investments Ex tooth paste Problem Child Question Mark O 0 00000000 High market growth low market share Most managerially intensive products in that they require signi cant resources to maintain and potentially increase their market share Cash absorbing Ex coke fuze Low market growth low market share Cash neutral Losing money lnvest money doesn t do anything Dogs are not destined for stardom and should be phased out unless they are needed to complement or boost the sales of another product or for competitive purposes i Hz at Existing Pmde lHlew Hindualts Existing M lll REE Product Development Penetration Development Mafke t Diversification Market Penetration 0 O O Employs the existing marketing mix and focuses the firm s efforts on existing customers Requires greater marketing efforts Ex Rewards card Market Development 0 O O Employs the exiting marketing offering to reach new segments whether domestic or international Riskier because they must deal with government regulations cultural traditions supply chains and language Ex going international Product Development 0 0 Offers a new product or service to a firm s current target market Ex stay open later Diversi cation O O Introduces a new product or service to a market segment that currently is not served Related diversification the current target market andor marketing mix shares something in common with the new opportunity Unrelated diversification a growth strategy where by a new business lacks any common elements with the present business
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