Chapter 2 Vocabulary

Question 1

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

Answer 1

Strategic planning

Question 2

A statement of the organization’s purpose-what it wants to accomplish in the larger environment

Answer 2

Mission statement

Question 3

Four steps in strategic planning

Answer 3

Defining the company mission

Setting the company objectives and goals (corporate level)

Designing the business portfolio

Planning marketing and other functional strategies (business unit, product, and market level)

Question 4

The collection of businesses and products that make up the company

Answer 4

Business portfolio

Question 5

The process by which management evaluated the products and businesses that make up the company

Answer 5

Portfolio analysis

Question 6

A strategic business unit (SBU) can be

Answer 6

A company division, a product line within a division or sometimes a single product or brand

Question 7

A portfolio planning method that evaluates a company’s SBUs in terms of market growth and relative market share

Answer 7

Growth-share matrix

Question 8

High relative market share and low growth rate

Answer 8

Cash cow

Question 9

Low relative market share and low growth rate

Answer 9

Dog

Question 10

Low relative market share and high growth rate

Answer 10

Question mark

Question 11

High relative market share and high growth rate

Answer 11

Star

Question 12

Stars overtime will become what

Answer 12

Cash cows

Question 13

Four strategies for each SBU

Answer 13

Build: invest more to build shares
Hold: invest just enough to hold shares at current level
Harvest: milk short term cash flow regardless of long term effect
Divest: selling or phasing out and using the resources elsewhere

Question 14

Investing more

Answer 14

Build

Question 15

Investing just enough

Answer 15

Hold

Question 16

Milking short term cash flow regardless of the long term effect

Answer 16

Harvest

Question 17

Selling or phasing out and using resources elsewhere

Answer 17

Divest

Question 18

A portfolio planning tool for identifying company growth opportunities through market penetration, market development, product development or diversification

Answer 18

Product/market expansion grid

Question 19

Company growth by increasing sales of current products to current market segments without changing the product

Answer 19

Market penetration

Question 20

Company growth by identifying and developing new market segments for current company product

Answer 20

Market development

Question 21

Company growth by offering modified or new products to current market segments

Answer 21

Product development

Question 22

Company growth through starting up or acquiring businesses outside the company’s current products and markets

Answer 22

Diversification

Question 23

The marketing logic by which the company hopes to create customer value and achieve profitable customer relationships

Answer 23

Marketing strategy

Question 24

Dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors and who might require separate marketing strategies or mixes

Answer 24

Market segmentation

Question 25

A group of customers who respond in a similar way to a given set of marketing efforts

Answer 25

Market segment

Question 26

The process of evaluating each market segments attractiveness and selecting one or more segments to enter

Answer 26

Market targeting

Question 27

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

Answer 27

Positioning

Question 28

Actually differentiating the market offering to create superior customer value

Answer 28

Differentiation

Question 29

The set of tactical marketing tools—product, price, place and promotion— that the firm blends to produce the response it wants in the target market

Answer 29

Marketing mix

Question 30

The goods and services combination the company offers to the target market

Answer 30

Product

Question 31

The amount of money customers must pay to obtain the product

Answer 31

Price

Question 32

Company activities that make the product available to target consumers

Answer 32

Place

Question 33

Activities that communicate the merits of the product and persuade target customers to buy it

Answer 33

Promotion

Question 34

An overall evaluation of the company’s strengths, weaknesses, opportunities, and threats

Answer 34

SWOT analysis

Question 35

Internal and positive: internal capabilities that may help a company reach its objectives

Answer 35

Strengths

Question 36

External and positive: external factors that the company may be able to exploit to its advantage

Answer 36

Opportunities

Question 37

Internal and negative: internal limitations that may interfere with a company’s ability to achieve its objectives

Answer 37

Weaknesses

Question 38

External and negative: Current and emerging external factors that may challenge the company’s performance

Answer 38

Threats

Question 39

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

Answer 39

Marketing implementation

Question 40

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

Answer 40

Marketing control