2. Company and Marketing Strategy Flashcards
A statement of the organisation’s purpose—what it wants to accomplish in the larger environment
Mission statement
The process of developing and maintaining a strategic fit between the organisation’s goals and capabilities and its changing market opportunities
Strategic planning
The collection of businesses and products that make up the company
Business portfolio
The process by which management evaluates the products and businesses that make up the company
Portfolio analysis
A portfolio-planning method that evaluates a company’s strategic business units (SBU) in terms of their market growth rate and relative market share.
Uses the Boston Consulting Group (BCG) approach
Growth-share matrix
A unit of the company that has a separate mission and objectives and that can be planned independently from other company businesses
Strategic business unit (SBU)
Describe the axes of the growth-share matrix
Market growth rate provides measure of market attractiveness
Relative market share serves as a measure of company strength in the market
High growth, high share businesses and products
They often need heavy investment to finance their rapid growth
Eventually their growth will slow down and they will turn into cash cows
Stars
Low-growth, high-share businesses or products
These established and successful SBUs need less investment to hold their market share.
Thus, they produce a lot of cash that the company uses to pay it’s bills and to support other SBUs that need investment
Cash cows
Low-share business units in high-growth markets
They require a lot of cash to hold their share, let alone increase it
Management needs to think hard about which ones it should try to build into stars and which should be phased out
Question marks
Low-growth, low-share businesses and products
They may generate enough cash to maintain themselves but do not promise to be large sources of cash
Dogs
A portfolio-planning tool for identifying company growth opportunities through market penetration, market development, product development or diversification
Product/market expansion grid
A strategy for company growth by increasing sales of current market segments without changing the product
Market penetration
A strategy for company growth by identifying and developing new market segments for current company products
Market development
A strategy for company growth by offering modified or new products to current market segments
Product development
A strategy for company growth through starting up or acquiring businesses out side the company’s current products and markets
New products and new markets
Diversification
Reducing the business portfolio by eliminating the products or business units that are not profitable or that no longer fit in the company’s overall strategy
Downsizing
The series of departments that carry out value-creating activities to design, produce, market, deliver and support a firm’s products
Value chain
The network made up of the company, suppliers, distributors and ultimately customers who ‘partner’ with each other to improve the performance of the entire system
Value delivery network
The marketing logic by which the business unit hopes to achieve it’s marketing objectives
Marketing strategy
Dividing a market into smaller group with distinct needs, characteristics or behaviours who might require separate products or marketing mixes
Market segmentation
A group of consumers who respond in a similar way to a given set if marketing efforts
Market segment
The process of evaluating each market segment’s attractiveness and selecting one or more segments to enter
Market targeting
Arranging for a product to occupy a clear, distinctive and desirable place relative to competing products in the minds of target consumers
Positioning
