Chapter 2 Strategic Planning for Competitive Advantage LO 1 The Nature of Strategic Planning strategic planning managerial process of creating maintaining a fit between the organization s objectives resources and the evolving market opportunities planning process of anticipating future events and determining strategies to achieve future objectives marketing planning designing activities relating to marketing objectives and the changing marketing environment marketing plan written document that acts as a guide book of marketing activities for the marketing manager LO 2 Defining the Business Mission analysis of environmental conditions mission statement statement of firm s business based on a careful analysis of benefits sought by customers and an marketing myopia defining a business in terms of goods services rather than benefits customers seek strategic business unit SBU a subgroup of a single business or collection of related businesses within the larger collection LO 3 Conducting a Situation Analysis SWOT analysis identifying internal strengths weaknesses and external opportunities threats Environmental scanning collecting info about forces events and relationships in the external environment that may affect the future of the organization LO 4 Setting Marketing Plan Objectives LO 5 Competitive Advantage marketing objective statement of what is to be accomplished through marketing activities competitive advantage set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition cost competitive advantage being the low cost competitor in an industry while maintaining satisfactory profit margins experience curves show costs declining at a predictable rate as experience with a product increases product service differentiation competitive advantage provision of something that is unique and valuable to buyers beyond simply offering a lower price than that of the competition niche competitive advantage advantage achieved when a firm seeks to target and serve a small segment of the market sustainable competitive advantage an advantage that cannot be copied by competition LO 6 Strategic Directions market penetration tries to increase market share among existing customers market development attracting new customers to existing products product development creation of new products for present markets diversification increasing sales by introducing new products to new markets portfolio matrix tool for allocating resources among products or strategic business units on the basis of relative market share and market growth rate o star fast growing market leader o cash cow generates more cash than it needs to maintain its market share o problem child question mark shows rapid growth but poor profit margins o dog has low growth potential and a small market share LO 7 Describing the Target Market marketing strategy selecting describing target markets and developing maintaining a marketing mix that will produce mutually satisfying exchanges with target markets market opportunity analysis MOA description estimation of the size and sales potential of market segments that are of interest to the firm and the assessment of key competitors in these market segments LO 8 The Marketing Mix marketing mix unique blend of product place promotion and pricing designed to produce mutually satisfying exchanges with a target market four P s product place promotion and price which make up the marketing mix LO 9 Following Up on the Marketing Plan implementation process that turns a marketing plan into action assignments and ensures that these assignments are executed in a way that accomplishes the plans objectives evaluation gauging the extent to which the marketing objectives have been achieved during the specified time period control provides the mechanisms for evaluating marketing results in light of the plans objectives and for correcting actions that do not help the organization reach those objectives within budget guidelines marketing audit thorough systematic periodic evaluation of the objectives strategies structure and performance of the marketing organization
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