Marketing Textbook Reading Notes Chapter 2 Company Wide Strategic Planning Defining Marketing s Role o Each company needs a game plan for long run survival and growth given situations opportunities objectives and resources Strategic Planning the process of developing and maintaining a strategic fit between the organization s goals and capabilities and its changing marketing opportunities Sets the stage for annual plans long range plans and strategic plans to keep a business going forward and adapt to any changes o Start by defining overall purpose and mission which is then turned into detailed supporting objectives that guide the company o Defining a Market Oriented Mission Mission Statement A statement of the organization s purpose what it wants to accomplish in the larger environment What IS our business Who is the customer What do consumers value What should our business be A formal mission statement answers these questions Mission statements should be market oriented and defined in terms of satisfying basic customer needs o Setting Company Objectives and Goals Turn the mission statement into detailed supporting objectives Broad mission becomes a hierarchy of objectives including for each level of management business and marketing obj Marketing strategies and programs developed to support these obj To increase market share company can broaden product lines increase product availability and expand into new markets o Business Portfolio the collection of businesses and products that make up a company Best one is one that fits the company s strengths and weaknesses to opportunities in the environment o Involves two steps Company must analyze its current business portfolio and determine which businesses should receive more less or no investment Then shape future portfolio by developing strategies for growth downsizing o Analyzing the Current Business Portfolio Portfolio Analysis The process by which management evaluates the products and businesses that makes up the company Put strong resources into its more profitable businesses BCG Matrix Stars Cash Cows Question Marks Dogs Designing the Business Portfolio Developing Strategies for Growth and Downsizing o Marketing has the main responsibility for achieving profitable growth for the company Marketing needs to identify evaluate and select market opportunities and establish strategies for capturing them o Product Market expansion grid A portfolio planning tool for identifying company growth opportunities through market penetration market development product development or diversification o Market Penetration Company growth by increasing sales of current products to current market segments without changing the product o Market Development Company growth by identifying and developing new market segments for current company products o Product Development Company growth by offering modified or new products to current market segments o Diversification Company growth through starting up or acquiring businesses outside the company s current products and markets Partnering with Other Company Departments o Value Chain the series of internal departments that carry out value creating activities to design produce market deliver and support a firm s products Need to coordinate their activities and work in harmony Partnering with Others in the Marketing System o QSCV quality service cleanliness value o More companies are partnering with other members of the supply chain suppliers distributors etc to improve the performance of the customer value delivery network Marketing Strategy and the Marketing Mix o Consumers in the center they are most important goal is to create value for them and build profitable relationships o Marketing Strategy the marketing logic by which the company hopes to create this customer value and achieve these profitable relationships o Company then decides which customers to serve segmentation and targeting and how they will serve them differentiation or positioning Identifies the total market and divides it into smaller segments selects promising segments then focuses on serving and satisfying these customers o Guided by the marketing strategy company designs their marketing mix 4 P s Customer Driven Marketing Strategy o Customer analysis is key to customer centered marketing o Market Segmentation Marketer must determine which segment offers the best opportunities The process of dividing a market into distinct groups of buyers who have different needs characteristics or behaviors and who might require separate products or marketing programs A market segment consists of consumers who respond in a similar way to a given set of marketing efforts o Market Targeting Involves evaluating each market segment s attractiveness and selecting one or more segments to enter A company should target segments in which it can profitably generate the greatest customer value and sustain it over time Most companies will enter a new market by serving a single segment if it proves successful they will add more o Market Differentiation and Positioning A product s position is the place it occupies relative to competitors products in the consumers minds want a unique position Positioning is arranging for a product to occupy a clear distinctive and desirable place relative to competing products in the minds of the targeted consumers Differentiation is actually distinguishing the market offering to create superior customer value o Developing an Integrated Marketing Mix Marketing Mix set of tactical marketing tools 4 P s that the firm blends to produce the response it wants in the target market Product goods and services the company offers Price amount of money customers must pay for the product Place includes company activities that make the product available to target consumers Promotion activities that communicate the merits of the product and persuade customers to buy it An effective marketing program will blend each element together to achieve their goals and deliver value From the BUYER S viewpoint 4 C s come first Customer solution Customer cost Convenience Communication Marketers should think C s then build the P s onto that platform o Managing the Marketing Effort Managing the marketing process requires the four marketing management functions analysis planning implementation and control Planning develop strategic plans develop marketing plans Implementation carry out the plans Control measure results evaluate results take corrective action if