Chapter 2

Question 1

Marketing Strategy

Answer 1

Identifies a firm’s target markets, a related marketing mix - the 4 Ps, and the bases upon which the firm plans to build a sustainable competitive advantage

Question 2

Sustainable Competitive Advantage

Answer 2

Something the firm can persistently do better than its competitors that is not easily computed and thus can be maintained over a long period of time

Question 3

Customer Excellence

Answer 3

Involves a focus on retaining loyal customers and excellent customer service

Question 4

Operational Excellence

Answer 4

Involves a focus on efficient operations and excellent supply chain management

Question 5

Product Excellence

Answer 5

Involves a focus on achievement high-quality products and effective branding and positioning

Question 6

Locational Excellence

Answer 6

Involves a focus on a good physical location and Internet presence

Question 7

Planning Phase

Answer 7

• define mission/objectives of business

- evaluate the situation by assessing how players (internal + external) affect the firms potential success

Question 8

Marketing Plan Phases

Answer 8

1) Planning Phase
2) Implementation Phase
3) Control Phase

Question 9

Implementation Phase

Answer 9

• identity/evaluate different opportunities by ending in segmentation, targeting and positioning
• develop marketing mix by using 4 Ps

Question 10

Control Phase

Answer 10

-evaluate performance of marketing strategy and use corrective actions

Question 11

Mission Statement

Answer 11

A broad description of a firm’s objectives and the scope of activities it plans to undertake; attempts to answer 2 main questions:

1) What type of business is it?
2) What does it need to do to accomplish its goals and objectives?

Question 12

Situation Analysis (SWOT)

Answer 12

The 2nd step in a marketing plan; uses SWOT analysis that assesses both the internal environment with regard to its strengths and weaknesses and the external environment in terms of its opportunities and threats

Question 13

STP

Answer 13

The processes of segmentation, targeting, positioning that firms use to identify and evaluate opportunities for increasing sales and profits

Question 14

Market Segment

Answer 14

A group of consumers who respond similarly to a firm’s marketing efforts

Question 15

Market Segmentation

Answer 15

The process of dividing the market into distinct groups of customers - where each individual group has similar needs, wants or characteristics - who therefore might appreciate products or services geared especially for them in similar ways

Question 16

Target marketing/targeting

Answer 16

The process of evaluating the attractiveness of various segments and then deciding which to pursue as a market

Question 17

Market positioning

Answer 17

Involves the process of defining the marketing mix variables so that target customers have a clear, distinct, desirable understanding of what the product does or represents in comparison with competing products

Question 18

Strategic Business Unit (SBU)

Answer 18

A division of the company that can be managed somewhat independently from other divisions since it markets a specific set of products to a clearly defined group of customers

Question 19

Product Line

Answer 19

A group of products that consumers may use together or perceive as similar in some way

Question 20

Relative Market Share

Answer 20

A measure of the product’s strength in a particular market

= the sales of the focal product / by the sales achieved by the largest firm in the industry

Question 21

Market growth rate

Answer 21

The annual rate of growth of the specific market in which the product competes

Question 22

Stars

Answer 22

• high growth markets

- high market share products

Question 23

Cash Cows

Answer 23

• low-growth markets

- high market share products

Question 24

Question Marks

Answer 24

• high growth markets

- low market shares

Question 25

Dogs

Answer 25

• low growth markets

- low market shares

Question 26

Market Penetration Strategy

Answer 26

A growth strategy that employs the existing marketing mix and focuses the firm’s efforts on existing customers

Question 27

Market Development Strategy

Answer 27

A growth strategy that employs the existing marketing offering to reach new market segments, whether domestic or international or segments not currently served by the firm

Question 28

Product Development Strategy

Answer 28

A growth strategy that offers a new product or service to a firm’s current target market

Question 29

Diversification Strategy

Answer 29

A growth strategy whereby a firm introduces a new product or service to a market segment that it does not currently serve

Question 30

Downsizing

Answer 30

Exiting markets, reducing product portfolios, or closing certain businesses or store or plant locations