building market strategy Flashcards
what are the four types of Ansoff strategy opportunity matrix?
-market penetration
-market development
-development
-diversification
what is the purpose for ansoff strategic opportunity matrix?
understand the opportunities relative to the markets we could be serving whether they are existing, or new, and the products we could be selling in the marketplace
what is market pentration?
- serving more customers within the current customer segments with the same offerings the org already produces
-lowest risk since you have experience with them and has the lowest potential reward for the and lowest in the revenue stream
what is market development?
- serving a new customer segment (new market) with current products
what is product devlopment?
serving the current segment with new offerings that the org could potentially build
what is diversifcation?
-serving new customer segments with new offerings
- highest risk (no experience) and has highest potential reward (creating future revenue streams)
what are the four types of Boston consulting group matrix?
- star - high growth and high share
- cash cow - low growth and high share
- question mark - high growth and low share
- dog - low share and low growth
what is the purpose of the Boston Consulting Group matrix? what are the two metrics that SBUs use?
-used to predict future cash distributions for strategic business units by plotting the current performance of the orgs offerings in the market in 2 metrics
-1. relative market share: percentage of market share the offering captures in a given market relative to the market share of the other offerings
2. market growth rate: the current rate of growth for the market in which it is sold
where would you invest in Boston?
- stars: lot to invest in and grow share
- question marks - pushed against by other winners and lot of investment: if you invest carefully, figure out how we can capture more but know when to abandon an offering that will not capture a high percentage
why would you not always want to invest in stars? where does the money come from?why would we want to keep dogs?
- uses a lot of money
- cash cows
- only want when it is a legacy product and signals something about the brand
what are the three sections of Porter’s generic strategies?
- cost leadership - invest to lower the cost of operation
- differentiation - uniquely desirable products that serve broad market needs (investment to make your product better)
- focus (differentiation)= specialized service in niche markets (difficult to win with low cost and narrow)
what are the two matrices that f Porter’s generic strategies is measured in?
-competitive advantage
-target scope
what is competitive advantage?
orgs can focus on creating a unique offering in the market place to serve unique needs of particular customer segments (product uniqness) or lower cost of operations which would capture more profit from every transaction (low cost)
what is the target scope?
decide on the scope of the target market it wants to serve and to decide to serve the needs of the broader market place or narrower customer segments with extremely specialized needs
why is focus strategy low cost excluded?
- does not work because a narrow segement with low cost is hard
- you wouold have to decrease cost per unit to make profit
what are the three types of aspiration decisions and what are they?
-segmenting= group customers based on similar needs/profiles each
- targeting =assess the attractiveness of each segment. select segments into targets
- positioning = define the value proposition for target segments/develop an action plan
market define
heterogeneous set of people or orgs with needs or wants and the ability and willingness to buy
define market segment
a more homogenous subgroup of people of organizations sharing one or more characteristics that cause them to have similar, identifiable segments or groups
define market segmentation
the process fo dividing a market into meaningful relatively similar, identifiable segments or groups
why do companies segment their markets?
- we can understand the needs of segment markets which will let us target their needs in a specific way letting us give better value and better focus out resources
why do organization and customers segment the market?
- customers: convenience and time-saving
tailored product and services
relevant offers
personalized experiences - org : identification of unfulfilled needs
better product design
more targeted promotions
increased customer satisfaction
why do companies segment their market?
-more precise definition of customer needs and wants
- more accurate marketing objectives
-improved resource allocation
-better marketing results
how do we segment the market? (like the good criteria)
- identifiable and measurable - identify customers in each segment and to measure their characteristics
- substantial -large enough to be profitable
- accessible - reachable through communication and distribution channels
- stable - over a large enough period that any marketing effort would be successful
- differentiable - each segment should have different needs
- actionable - attract and serve customers in identifiable segment
what are the dimensions for segmenting consumer markets?
geographic
demographic
psychographic - lifestyle personality
behavioral - usage rates, loyalty etc
benefits sought - goal
what is the family life cycle?
the number of demographic values added together helps retailers catch people in their change to different stages (different stages means people make diff changes)
geodemographic sgementation?
segmenting potential customers into neighborhood lifestyle categories. combines geographic, demographic, and lifestyle segmentation
dimensions for segmenting business markets?
geographic - country, region
firmographic - industry/ firm size
buying approach
behavioral
benefits sought
satisfiers
business customers who place an order with the first familiar supplier to satisfy product and delivery requirements
optimzers?
business customers who consider numerous suppliers,both familiar and unfamiliar and study all carefully before picking one
