Chapter 2

Question 1

What are the 3 components of a marketing strategy

Answer 1

Sustainable competitive advantage:
How will we provide better value than the competition?

Target market:
Who will we try to exchange with?

Marketing mix:
How will we offer, communicate, deliver, and capture value?

Question 2

What are the 4 macro strategies that can help a firm develop a sustainable competitive advantage

Answer 2

Customer excellence:
Provide excellent customer service to retain loyal customers

Operational excellence:
Structuring organization to be more efficient

Product excellence:
Products with high perceived value and effective branding and positioning

Location excellence:
Physical location
Hard to duplicate (if you already have the best location -> nobody else can have it)

Question 3

What are the 5 steps of creating a marketing plan

Answer 3

1. Business mission and objective
2. Situational analysis (SWOT)
3. identify opportunities (segmentation, targeting, positioning)
4. implement marketing mix and allocate resources (use 4 P’s)
5. evaluate performance using marketing metrics

Question 4

What does SWOT stand for and what does it mean

Answer 4

Strengths: internal capabilities that may help a company reach its objectives (internal/positive)

Weaknesses: internal limitations that may interfere with a company’s ability to achieve its objectives (internal/negative)

Opportunities: external factors that the company may be able to exploit to its advantage (external/positive)

Threats: current and emerging external factors that may challenge the company’s performance (external/negative)

Question 5

Define segmentation, targeting and positioning

Answer 5

Segmentation: potential buyers who might need separate products & markets

Targeting: select segment (one or more) on attractiveness to target

Positioning: select a clear position to occupy space related to competition (in the minds of the target consumer)

Question 6

What are the 4 growth strategies that a company can use

Answer 6

1. Market penetration
   Existing markets and existing products
   Ex. coffee punch card
2. Product development
   New products and existing markets
   Ex. marvel movies (people going back to see new movies)
3. Market development
   New markets and existing products
   Ex. go to another country with products
4. Diversification
   New products and new markets
   Ex. colgate lasagna (most risky)

Question 7

What is a mission statement

Answer 7

A broad description of a firm’s objectives and the scope of activities it plans to undertake; attempts to answer two main questions: What type of business is it? What does it need to do to accomplish its goals and objectives?

Question 8

What is integrated marketing communications (IMC)

Answer 8

Represents the promotion dimension of the four Ps; encompasses a variety of communication disciplines—general advertising, personal selling, sales promotion, public relations, direct marketing, and electronic media—in combination to provide clarity, consistency, and maximum communicative impact.

Question 9

What is market share

Answer 9

Percentage of a market accounted for by a specific entity.