2. Company and Marketing Strategy: Partnering to Build Customer Engagement, Value, and Relationships

Question 1

Strategic planning
(goals + capabilities + opportunities)
(1. Corporate level: mission -> objectives -> portfolio
2. Business unit, product and market level: marketing and other functional strategies)

Answer 1

The process of developing and maintaining a strategic fit between:
+ organization’s goals
+ capabilities
+ its changing marketing opportunities.

Strategic planning involves
1. Corporate level:
defining a clear company “mission”
-> setting supporting “objectives”
-> designing a sound “business portfolio”
2. Business unit, product and market level:
-> planning “marketing and other functional strategies”

Question 2

Mission statement

want to accomplish in the larger environment

Answer 2

A statement of the organization’s purpose—what it wants to accomplish in the larger environment

Question 3

Business portfolio (businesses + products = com.)

Answer 3

the collection of businesses and products that make up the company

The best business portfolio is the one that best fits the company’s strengths and weaknesses to opportunities in the environment.

Business portfolio planning involves two steps.

1. analyze its current business portfolio and determine which businesses should receive more, less, or no investment.
2. it must shape the future portfolio by developing strategies for growth and downsizing.

Question 4

Portfolio analysis (evaluate -> identify strategic business units (SBUs))

Answer 4

The process by which management evaluates the products and businesses making up the company

Management’s first step is to identify the key businesses that make up the company, called strategic business units (SBUs):

1. a company division,
2. a product line within a division,
3. a single product or brand.

most standard portfolio analysis methods evaluate SBUs on two important dimensions:

1. the attractiveness of the SBU’s market or industry
2. the strength of the SBU’s position in that market or industry

Question 5

growth-share matrix

growth -> attractive, share -> strength

Answer 5

A portfolio-planning method that evaluates a company’s SBUs in terms of

1. market growth rate (attractiveness)/(cash usage)
2. relative market share (strength)/(cash generation)

SBUs: stars, cash cows, question marks, or dogs.

Question 6

Stars (phone, TV)

Answer 6

• high-growth
• high-share

heavy investments to finance their rapid growth
growth will slow down -> cash cows.

Question 7

Cash cows (washing machine)

Answer 7

• low-growth (cash usage)
• high-share (cash generation)

less investment to hold their market share
=> produce a lot of the cash -> pay bills and support other SBUs

Question 8

Question marks (printer)

Answer 8

• low-share (cash generation)
• high-growth (cash usage)

require a lot of cash to hold their share, let alone increase it
Management has to think hard about which question marks -> stars/be phased out.

Question 9

Dogs

Answer 9

• low-growth
• low-share

generate enough cash to maintain themselves but do not promise to be large sources of cash

Question 10

Problems with Matrix Approaches

Answer 10

• Difficulty in defining SBUs and measuring market share and growth
• Time consuming
• Expensive
• Focus on current businesses, not future planning

Question 11

product/market expansion grid

Answer 11

A portfolio-planning tool for identifying company growth opportunities through market penetration (sự xâm nhập), market development, product development, or diversification.

Question 12

Market penetration (without changing the product)
(new branch of restaurant, same menu)

Answer 12

Company growth by increasing sales of “current” products to current market segments “without changing the product”.
(new branch of restaurant, same menu)

Question 13

Market development (new segments)
(build in another country, same menu)

Answer 13

A strategy for company growth by identifying and developing “new market segments” for “current company products”
(build in another country, same menu)

Question 14

Product development (modified or new products)
(old restaurant, new menu)

Answer 14

A strategy for company growth by offering “modified or new products to current market segments”
(old restaurant, new menu)

Question 15

Diversification (outside both current products and markets)

another country, new menu

Answer 15

A strategy for company growth through starting up or acquiring businesses “outside the company’s current products and markets”
(another country, new menu)

Question 16

Value chain

Answer 16

The “series of internal departments” that carry out “value-creating activities” to design, produce, market, deliver, and support a firm’s products.

Question 17

Value delivery network

Answer 17

A “network” composed of the company, suppliers, distributors, and, ultimately, customers who “partner” with each other to improve the performance of the entire system in delivering customer value.

Question 18

Marketing strategy

Answer 18

The “marketing logic” by which the company hopes to “create customer value and achieve profitable customer relationships”.

Question 19

Downsizing

Answer 19

Reducing the business portfolio by “eliminating” products or business units that are “not profitable” or that no longer fill the company’s overall strategy

Question 20

Market segmentation

divide

Answer 20

Dividing a market into “distinct groups” of buyers who have “different” needs, characteristics, or behaviors and who might require separate marketing strategies or mixes.

Question 21

Market segment

Answer 21

A group of consumers who respond in a “similar way” to a given set of marketing efforts.

Question 22

Market targeting
(evaluate and select)

Answer 22

“Evaluating” each market segment’s attractiveness and “selecting” one or more segments to serve.

Question 23

positioning

arrange

Answer 23

Arranging for a product to occupy “a clear, distinctive, and desirable place relative” to competing products in the minds of target consumers.

Question 24

Differentiation

Answer 24

Actually differentiating the market offering to create “superior customer value”.

Question 25

Marketing mix (4Ps)

Answer 25

The set of tactical marketing tools—product, price, place, and promotion—that the firm blends to produce the response it wants in the target market.

Question 26

4Ps

Answer 26

• Product means the goods-and-services combination the company offers to the target market.
• Price is the amount of money customers must pay to obtain the product.
• Place includes company activities that make the product available to target consumers.
• Promotion refers to activities that communicate the merits of the product and persuade target customers to buy it.

Question 27

SWOT analysis

Answer 27

An overall evaluation of the company’s strengths (S), weaknesses (W), opportunities (O), and threats (T).

Question 28

Marketing implementation

strategies and plans -> actions

Answer 28

Turning marketing strategies and plans into marketing actions to accomplish strategic marketing objectives.

Question 29

Marketing control

measure -> evaluate -> corrective actions

Answer 29

• Measuring
• evaluating the results of marketing strategies and plans
• taking corrective action to ensure that the objectives are achieved

Question 30

Marketing return on investment (marketing ROi)

Answer 30

The net return from a marketing investment divided by the costs of the marketing investment.