CHAP 2 Flashcards
the importance of strategic planning
Strategic planning is the managerial process of creating and maintaining a fit between the organization’s objectives and resources and the evolving market opportunities. The goal of strategic planning is long-run profitability and growth. Thus, strategic decisions require long-term commitments of resources. These decisions affect the allocation of resources and ultimately the financial success of the company.
strategic alternatives
One method for developing alternatives is Ansoff’s strategic opportunity matrix, which matches products with markets and can be found on pages 18 and 19 in the textbook. Firms can explore these four options: market penetration, market development, product development, and diversification.
mission statement
The mission statement answers the question “What business are we in or why do we exist?” The firm’s mission statement establishes boundaries for all subsequent decisions, objectives, and strategies. A mission statement should focus on the market or markets the organization is attempting to serve rather than on the good or service offered
situation analysis
Marketers must understand the current and potential environment in which the product or service will be marketed. A situation analysis is sometimes referred to as a SWOT analysis; that is, the firm should identify its internal strengths (S) and weaknesses (W) and also examine external opportunities (O) and threats (T).
types of competitive advantage
cost
product/service differentiation
and niche.
marketing objectives
Marketing objectives should be realistic, measurable, time-specific, and compared to a benchmark. They must also be consistent and indicate the priorities of the organization. Good marketing objectives communicate marketing management philosophies, and provide direction for lower-level marketing managers so that marketing efforts are integrated and pointed in a consistent direction, motivate employees, force executives to think clearly, and form a basis for control.
targeting market strategies
Targeting market strategies begins with a market opportunity analysis, or MOA, which describes and estimates the size and sales potential of market segments that are of interest to the firm. In addition, an assessment of key competitors in these market segments is performed. After the market segments are described, one or more may be targeted by the firm.
marketing Mix
Marketing mix refers to a unique blend of product, place (distribution), promotion, and pricing strategies (often
referred to as the four Ps) designed to produce mutually satisfying exchanges with a target market. The heart of
the marketing mix, the starting point, is the product offering and product strategy. Place (distribution)
strategies are concerned with making products available when and where customers want them. Promotion
includes advertising, public relations, sales promotion, and personal selling. Price is what a buyer must give up
in order to obtain a product and is often the most flexible of the four Ps— the quickest element to change.
implementation
is the process that turns a marketing plan into action assignments and ensures that these assignments are executed in a way that accomplishes the plan’s objective.
evaluation
Evaluation entails gauging the extent to which marketing objectives have been achieved during the specified time period.
control
Control provides the mechanisms for evaluating marketing results in light of the plan’s objectives and for correcting actions that do not help the organization reach those objectives within budget guidelines.
marketing plan or marketing audit
helps management allocate marketing resources efficiently. After the audit has been completed, three tasks remain.
effective strategic planning
Effective strategic planning requires continual attention, creativity, and management commitment. . Strategic planning should not be an annual exercise in which managers go through the motions and forget about strategic planning until the next year. A sound strategic planning is based on creativity.
