Chapter 2 Strategic Market Planning

Question 1

Define business planning

Answer 1

An ongoing process of making decisions that guide the firm both in the short term and for the long term.

Question 2

Define the business plan

Answer 2

A plan that includes the decisions that guide the entire organiation

Question 3

Define the marketing plan

Answer 3

A document that describes the marketing environment, outlines the marketing objectives and strategy and identifies who will be responsible for carrying out each part of the marketing strategy

Question 4

Define strategic planning

Answer 4

A managerial decision process that matches an organization’s resources and capabilities to its market opportunities for long-term growth and survival.

Question 5

Define strategy

Answer 5

What a firm is going to do to achieve an objective

Question 6

Define tactics

Answer 6

How a strategy is going to be enacted

Question 7

What is SBU

Answer 7

Strategic Business Unit

Question 8

Define SBU

Answer 8

A semi-autonomous entity that operates as an independent business with its own mission and objectives, and its own marketing strategy.

Question 9

Define functional planning

Answer 9

A decision process that concentrates on developing detailed plans for strategies and tactics for the short term, supporting an organization’s long-term strategic plan.

Question 10

Define operational planning

Answer 10

Planning that focuses on the day-to-day execution of the functional plans and includes detailed annual semiannual and quarterly plans

Question 11

Define the mission statement

Answer 11

A formal statement in an organization’s strategic plan that describes the overall purpose of the organization and what it intends to achieve in terms of its customers, products, and resources

Question 12

Define external environment

Answer 12

The uncontrollable elements outside of an organization that may affect its performance either positively or negatively. These include macro environment factors like regulatory or technology factors, consumer behavior trends, industry factors such as industry concentration and competitive factors such as the number and sophistication of competitors

Question 13

PESTO

Answer 13

Political (including legal or regulatory) economic, social or cultural, technological, or other trends or issues that might impact a particular industry and business.

Question 14

Internal environment

Answer 14

The controllable elements inside an organization including its people its facilities and how id does things, that influence the operations of the organization

Question 15

Levels of business planning: Top level

Answer 15

Strategic planning
A managerial decision process that matches firm’s resources and capabilities to its market opportunities for long term growth and survival
- conducted by top level management
- defines a firm’s purpose and objectives
-strategic business units (SBUs)

Question 16

Levels of business planning:

Middle Level

Answer 16

Functional planning
A decision process that concentrates on developing detained plans for strategies and tactics for the short term, supporting an organizations long term strategic plan
- Conducted by functional areas of a firm
-Marketing planning is a type of functional planning
- Performed by marketers

Question 17

Levels of business planning:

Bottom Level

Answer 17

Operational planning (nuts and bolts) daily actions
Day to day execution
Conducted by first line managers
Includes: annual plans, semi-annual plans, quarterly plans

Question 18

Strategic Planning (5 items)

Answer 18

1. Define the mission
2. Evaluate internal and external environment
3. Set organizational or SBU objectives
4. Establish business portfolio
5. Develop growth strategies

Question 19

BCG growth market share matrix

Answer 19

A portfolio analysis model developed by the Boston Consulting Group that assesses the potential of successful products to generate cash that a firm can then use to invest in new products

Question 20

Define market penetration strategies

Answer 20

Growth strategies designed to increase sales of existing products to current customers, nonusers, and users of competitive brands served markets

Question 21

Define market development strategies

Answer 21

Growth strategies that introduce existing products to new markets

Question 22

Define product development strategies

Answer 22

Growth strategies that focus on selling new products in served markets

Question 23

Define diversification strategies

Answer 23

Growth strategies that emphasize both new products and new markets

Question 24

Define metrics

Answer 24

Measurements or scorecards marketers use to identify the effectiveness of different strategies or tactics.

Question 25

Define competitive advantage

Answer 25

The ability of a firm to outperform the competition providing customers with a benefit the competition cannot

Question 26

Return on Marketing Investment (ROMI)

Answer 26

The revenue or profit margin generated by investment in a specific marketing campaign or program, divided by the cost of that program at a given risk level.

Question 27

Define operational plans

Answer 27

Plans focusing on the day-to-day execution of the marketing plan.

Question 28

Define business cycle

Answer 28

The overall patterns of change in the economy - including periods of prosperity, recession depression,, and recovery, that affect consumer and business purchasing power.

Question 29

Define export merchants

Answer 29

Intermediaries a firm uses to represent it in other countries

Question 30

Define licensing agreement

Answer 30

An agreement in which one firm gives another firm the right to produce and market its product in a specific country or region in return for royalties.

Question 31

Define franchising

Answer 31

A form of licensing involving the right to adapt an entir system of doing business

Question 32

Define strategic alliance

Answer 32

The relationship developed between a firm seeking a deeper commitment to a foreign market and a domestic firm in the target country.

Question 33

Define joint venture

Answer 33

A strategic alliance in which a new entity owned by two or more firms allows the partners to pool their resources for common good.

Question 34

Define backward invention

Answer 34

Product strategy in which a firm develops a product to serve the needs of people inviting in countries without electricity or other elements of a developed infrastructure

Question 35

Define grey market goods

Answer 35

Items manufactured outside a country and then imported without the consent of the trademark holder

Question 36

Define dumping

Answer 36

Pricing products lower in a foreign market than that offered in the home market

Question 37

Define price fixing

Answer 37

An illegal business practice in which competing firms decide in advance on a common price for their products

Question 38

Define slotting allowance

Answer 38

A fee paid by a manufacturer to a retailer in exchange for agreeing to place products on the retailer's shelves.