Chapter 2 Flashcards
Strategic Planning
The process of thoughtfully defining a firm’s objectives and developing a method for achieving those objectives.
Strategic Plan
An organization’s plans for key functional areas, such as marketing, human resources, finance, and risk management.
Mission Statement
A concise affirmation of the firm’s long-term purpose.
Situation Analysis
The systematic collection of data to identify the trends, conditions, and competitive forces that have the potential to influence the performance of the firm and the choice of appropriate strategies.
Marketing Plan
An action-oriented document or playbook that guides the analysis, implementation, and control of the firm’s marketing strategy.
Market Summary
A description of the current state of the market.
Strategy
The set of actions taken to accomplish organizational objectives.
Financial Projections
A bottom-line numerical estimate of the organization’s profitability.
SWOT Analysis
An evaluation of a firm’s strengths, weaknesses, opportunities, and threats.
Strengths (in SWOT)
Internal capabilities that help the company achieve its objectives.
Weaknesses (in SWOT)
Internal limitations that may prevent or disrupt the firm’s ability to meet its stated objectives.
Opportunities (in SWOT)
External factors that the firm may be able to capitalize on to meet or exceed its stated objectives.
Threats (in SWOT)
Current and potential external factors that may challenge the firm’s short- and long-term performance.
Market Segmentation
The process of dividing a larger market into smaller groups, or market segments, based on meaningfully shared characteristics.
Market Segments
The groups of consumers who have shared characteristics and similar product needs.
Target Market
The group of customers toward which an organization has decided to direct its marketing efforts.
Positioning
The activities a firm undertakes to create a certain perception of its product in the eyes of the target market.
Market Penetration
A marketing strategy that emphasizes selling more of existing goods and services to existing customers.
Product Development
A marketing strategy that involves creating new goods and services for existing markets.
Market Development
A marketing strategy that focuses on selling existing goods and services to new customers.
Diversification
A marketing strategy that seeks to attract new customers by offering new products that are unrelated to the existing products produced by the organization.
Competitive Advantage
The superior position a product enjoys over competing products if consumers believe it has more value than other products in its category.
Exporting
Selling domestically produced products to foreign markets.
Licensing
A legal process in which one firm pays to use or distribute another firm’s resources, including products, trademarks, patents, intellectual property, or other proprietary knowledge.
Franchising
A contractual arrangement in which the franchisor provides a franchisee the right to use its name and marketing and operational support in exchange for a fee and, typically, a share of the profits.
Joint Venture
An arrangement in which a domestic firm partners with a foreign company to create a new entity, thus allowing the domestic firm to enter the foreign company’s market.
Direct Ownership
A method of entering an international market in which a domestic firm actively manages a foreign company or overseas facilities.
Marketing Analytics
The practice of measuring, managing, and analyzing market performance.
Return on Marketing Investment (ROMI)
A measure of the firm’s effectiveness in using the resources allocated to its marketing effort.
Revenue Analysis
Marketing analytics tool that measures and evaluates revenue from specific products or regions.
Market Share Analysis
Marketing analytics tool that measures the percentage of total market sales captured by a brand, product, or firm.
Profitability Analysis
Marketing analytics tool that measures how much profit the firm generates, as well as how much profit certain aspects of the firm, including regions, channels, and customer segments, contribute.
