Chapter 2 Flashcards
1
Q
What is a marketing strategy?
A
- Identifies:
1) A firm’s target market
2) A related marketing mix (its four P’s)
3) the bases on which the firm plans to build a sustainable competitive advantage
2
Q
What is a sustainable competitive advantage? (Pepsi example)
A
- An advantage over the competition that is not easily copied and can be maintained over a long period of time
- Acts like a moat protecting companies from competition
- Key to long-term financial performance
- ex) Pepsi
— built a loyal customer base
— many types of beverages
— located in over 200 countries
— partnered with Cardi B ad Beyonce
3
Q
Marketing Plan Step 1: Business Mission and Objectives
A
- In planning phase
- Mission statement
— broad description of a firm’s goals
— What type of business is it, and what does it need to do to accomplish its goals?
— ex) Nonprofit organizations could have mission statement of providing resources, research, and support to medical foundations - Define an objective that is specific and quantifiable (main focus)
— linked to a specific product/service - 2 ways to set business objectives
— given by management
— product/service originates them (2 skills)
1) BGH Product Portfolio Matrix
2) Ansoff Matrix
4
Q
Marketing Plan Step 2: Situation Analysis + SWOT
A
- In planning phase
- Assess how various players, both inside and outside the organization, affect the firm’s potential for success
- Frameworks
— 5C’s Analysis
— SWOT Analysis
5
Q
Marketing Plan Step 3: Identify and Evaluate Opportunities
A
- In implementation phase
- Marketing managers identify and evaluate opportunities by engaging in a process known as segmentation, targeting, and positioning (STP)
6
Q
Segmentation, Targeting, and Positioning (STP)
A
- In Marketing Plan Step 3
- Firm divides marketplace into subgroups, determines which of those subgroups it should target, and decides how to position its products and services to best meet the needs of those chosen targets
- Goal to identify and evaluate opportunities for increasing sales and profits
7
Q
Segmentation (STP)
A
- Market segment
— group of consumers who respond similarly to a firm’s marketing efforts - Market segmentation
— process of dividing the market into groups of customers with different needs, wants, or characteristics (into different market segments)
8
Q
Targeting (STP)
A
- Target marketing
— evaluating each market segments’ attractiveness and deciding which to pursue
— ex) Coca-Cola targets different drinks at different segments (Diet Coke targeted for women and regular Coke targeted for men)
9
Q
Positioning (STP)
A
- Market positioning
— process of defining the marketing mix variables so that target customers have a clear understanding of what the product does or represents in comparison with competing products
— ex) Hertz pushes its great car products to customers and says customers will get peace of mind when they purchase from them
10
Q
Marketing Plan Step 4: Implement Marketing mix and Allocate Resources
A
- In implementation phase (analyzes the business)
- Product and Value Creation Products
— P: product
— create products that are valuable enough to buy so a profit will be made - Price and Value Capture
— P: price
— firms must charge a price that customers perceive as giving them a good value for the product they receive - Place and Value Delivery
— P: place
— make product readily accessible when and where the customer wants it
— online and in-person - Promotion and Value Communication
— Integrated marketing communications (IMC)
— advertising, personal selling, sales pitches, public relations, direct and online marketing
— marketers communicate a value proposition (unique value that a product provides, better than and different from competitors’ products)
11
Q
Marketing Plan Step 5: Evaluate performance using marketing metrics
A
- In control phase
- Taking any necessary corrective actions to alter marketing plan
- Metric
— measuring system that quantifies a trend, dynamic, or characteristic
— explain why things happened and can project the future
— can compare results across regions and time periods
— can then make appropriate adjustments
— unwise to use just one to make decisions because all business decisions impact more than one
— vary depending on:
1) Level of organization at which the decision is made
2) Resources the manager controls
— ex) analyzing how long people spend on certain ads can alter the ads that people see on social media
12
Q
How are competitive advantages made? (4 ways)
A
1) Customer excellence
2) Locational excellence
3) Operational excellence
4) Product excellence
13
Q
Competitive advantages in Uber vs Netflix
A
- Uber
— easy to use (product excellence)
— pretty much everywhere (locational excellence)
— low competition
— rating system (customer excellence)
— quick rides (operational excellence)
— solves a lot of problems, like coming back from airport, need a DD, etc. - Netflix
— iconic TV viewing
— first-mover
— ahead of other streaming services - Uber has greater competitive advantage
14
Q
Customer Excellence (way that competitive advantages are made)
A
- Retaining loyal customers
— strong brand
— unique merchandise
— people who drink Pepsi even if Coca-Cola is on sale
— view customers with lifetime perspective ($15,000 customer over 20 years) instead of transaction-by-transaction perspective (only $15 customer today)
— loyalty programs - Providing good customer service
— ex) Disney has apps for everything, enthusiastic and knowledgable staff
— sustainable for long periods of time once attained
15
Q
Operational Excellence (way that competitive advantages are made) (2 examples)
A
- Efficient operations and good supply chain and human resource management
- Get customers the merchandise they, when they want it, at a low cost
— earns profitability for themselves and satisfies customers’ needs - Requires good relationships with vendors
- ex) McDonalds is all over the country and run well at all locations
- ex) Amazon requires high-end technology, good quality human resource hiring and training employee programs
