3.1 Flashcards
mission statement definition
2 uses
formal summary of the aims and values of the organisation
1.focus, motivation
2.promotion and marketing
corporate objective definition
quantifies the mission of the business and sets measurable targets for the whole organisation
ansoffs matrix overview and draw it
strategic tool used to help businesses choose the market they wish to operate in
existing products new products
1.existing market product
markets penetration development
2.new market diversification
markets development
discuss market penetration within ansoffs matrix
- increase promotional activities
- change pricing model if prices elastic
- repeat purchases to increase customer loyalty
+ low risk
+ familiar market to business
+potential low investment required - limited growth potential
discuss product development within ansoffs matrix
~ conduct market research
~ divert funds into R&D
+ brand familiar with customers
+ promotes efficiency and innovation
- takes time and can expensive
- product cannibalisation?
discuss market development within ansoffs matrix
~ use of penetration pricing to enter a new market
~heavy promotion
~ develop new channels of distribution
+ large amounts of growth possible
- limited understanding
- competing against established businesses
Porters strategies overview
Businesses compete one of 3 things
1. Cost leadership
2.Differentiation
3. Segmentation
Dicuss cost leadership strategy
- keep average costs low
- economies of scale through growth
+ high profit margins
Multiple businesses cannot directly compete with cost
Porters strategy differentiation
Competing by offering unique product USP
Porters strategy segmentation
Targeting a specific group of customers and not whole market
(Benefits and drawbacks same as niche markets)
Aim of portfolio analysis
Categorise a companies products with specific characteristics in order to make strategic decisions about them
Competitive advantage definition
where a business creates unique value for its customers that is greater than offered by competitors
Dicuss SWOT analysis
definition, outline, pros and cons
Strategic tool that helps a business analyse its position and the external factors that might affect it
Strengths
Weaknesses
Opportunities
Threats
+ simple and clear
- subjective
- does not offer clear solutions
PESTLE FACTORS
(Analyse external factors)
Political -e.g market regulations
Economic
Social - changing demand of society for goods or services
Technological- developments in technological
Legal
Environmental - wastage
