Chapter 2

Question 1

Strategic planning

Answer 1

Process of developing and maintaining a strategic fit between the organization’s goals, capabilities and its changing marketing opportunities

Question 2

Strategic planning steps

Answer 2

1. Develop company mission
2. Set company objectives and goals
3. Design business portfolio
4. Planning, marketing and other functional strategies

Question 3

Mission statement

Answer 3

Organization’s purpose, should be market oriented and defined in terms of satisfying basic customer needs.

Should focus on customers and the customer experience.

Question 4

Business portfolio

Answer 4

Collection of businesses and products that make up the company.

1. Analyze firm’s current business portfolio
2. Develop strategies to shape the future portfolio

Question 5

Portfolio analysis

Answer 5

1. Identify strategic business units (SBUs)- company division, product line within division, single product or a brand
2. Assess SBUs attractiveness and decide on level of support SBU deserves

Question 6

BCG Growth Share Matrix

Answer 6

Stars- high growth, high share

Cash cows- low growth, high share

Question marks- high growth, low share

Dogs- low growth, low share

Question 7

BCG Growth Share Matrix weaknesses

Answer 7

Difficult, time consuming and costly

Difficult to define and measure

Provides little advice for future planning

Question 8

Product/Market expansion grid

Answer 8

Market penetration- make more sales to current customers without changing original products

Market development- identifying and developing new markets for its current products

Product development- offering modified or new products to market

Diversification- starting up or buying businesses beyond firm’s current products and markets

Question 9

Downsizing

Answer 9

Abandoning products or markets that are unprofitable or no longer fits business strategy

Question 10

Guiding philosophy- marketing concept

Answer 10

Company strategy should create customer value and build profitable relationships

Question 11

Internal value chain

Answer 11

Company departments are links.

Marketers should find ways to make sure departments are customer focused and develop a smooth functioning value chain

Question 12

Marketing strategy

Answer 12

Company hopes to create customer value and achieve profitable customer relationships.

Question 13

Market segmentation

Answer 13

Dividing market into distinct groups of buyers who have differ needs, characteristics, behaviors and who might require separate products or marketing programs

Question 14

Marketing segment

Answer 14

Group of consumers who respond in a similar way to a given set of marketing efforts

Question 15

Market targeting

Answer 15

Evaluating each market segment’s attractiveness and selecting one or more segments to enter

Question 16

Positioning

Answer 16

Arranging for a product to occupy a clear, distinctive and desirable place relative to competing products in the minds of target consumers

Question 17

Differentiation

Answer 17

Differentiating market offering to create superior customer value

Question 18

Managing marketing process

Answer 18

Analysis, planning, implementation, and control

Question 19

SWOT analysis

Answer 19

Strengths- internal
Weaknesses- internal
Opportunities- positive external
Threats- negative external

Question 20

Planning

Answer 20

Includes executive summary, swot analysis, objectives and marketing strategy, and includes action program to implement market strategy with a budget and outlines controls to monitor progress

Question 21

Market implementation

Answer 21

Turning marketing strategies and plans into marketing actions to accomplish strategic marketing objectives

Planning- doing the right things
Implementation- doing the things right

Question 22

Marketing control

Answer 22

Measuring and evaluating the results of marketing strategies and plans and taking corrective action to ensure the objectives are achieved

4 steps:

1. Set specific SMART goals
2. Measures performance in market
3. Evaluate causes of differences between actual and expected
4. Take corrective action for deviation

Question 23

Operating control

Answer 23

Ensure that company achieves sales, profits, and other goals set in its annual plans.

Question 24

Strategic control

Answer 24

Involves looking at whether company’s basic strategies are well matched to its opportunities

Question 25

Marketing return on investment

Answer 25

Net return from marketing investment divided by costs of the marketing investment