Chapter2: Company And Marketing Strategy: Partnering To Build Customer Engagement, Value, And Relationships

Question 1

Marketing strategy involves two key questions

Answer 1

Which customers will we serve (segmentation and targeting)?
How will we create value for them (differentiation and positioning)?
Then the company designs a marketing program - the four Ps - that delivers the intended value to targeted customers.

Question 2

What is marketing at its core?

Answer 2

At its core, marketing is all about creating customer value and profitable customer relationships.

Question 3

Customer value-driven marketing strategy (process)

Answer 3

Companies must be customer centred.
Process:
- customer analysis
- segmentation
- market targeting
- market differentiation
- positioning

Question 4

What is market segmentation

Answer 4

Dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviours, and who might require separate products or marketing programs.

Question 5

What is market targeting

Answer 5

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

Question 6

What is market differentiation

Answer 6

Differentiating the market offering to create superior customer value.

Question 7

What is market positioning

Answer 7

Positioning (with perceptual map) the product to occupy a clear, distinctive, and desirable place relative to competing products.
The entire marketing program should support the chosen positioning strategy.

Question 8

Developing an integrated marketing mix

Answer 8

The marketing mix - or the four Ps - consists of tactical marketing tools blended into an integrated program that actually engages target customers and delivers the intended customer value.

Question 9

Explain the four Ps of the marketing mix

Answer 9

1. Product: variety, quality, design, features, brand name, packaging, services.
2. Price: list price, discounts, allowances, payment period, credit terms.
3. Promotion: advertising, personal selling, sales promotion, public relations, direct and digital.
4. Place: supply chains, channel coverage, channel management, logistics, transportation.

Question 10

5 steps to managing the marketing effort

Answer 10

Analysis, planning (develop strategic plans —> develop marketing plans), implementation and organization (carry out the plans), control (measure results —> evaluate results —> take corrective action).

Question 11

Explain SWOT analysis

Answer 11

The goal of SWOT analysis is to match the company’s strengths to attractive opportunities in the environment while eliminating or overcoming the weaknesses and minimizing the threats.

INTERNAL
1. Strengths: internal capabilities that may help a company reach its objectives (e.g., production efficiency, ability to innovate, experience/knowledge).
2. Weaknesses: internal limitations that may interfere with a company’s ability to achieve its objectives (e.g., no experience).

EXTERNAL
1. Opportunities: external factors that the company may be able to exploit to its advantage.
2. Threats: current and emerging external factors that may challenge the company’s performance.

Can a threat/opportunity emerge if there is no change in the external environment? No.

Question 12

Contents of a marketing plan

Answer 12

1. Executive summary: brief summary of the main goals and recommendations.
2. Current marketing situation: gives the market description and the product, competition, and distribution review.
3. Threats and opportunities analysis: helps management to anticipate important positive or negative developments.
4. Objectives and issues: states and discusses marketing objectives and key issues.
5. Marketing strategy: outlines the broad marketing logic and the specifics of target markets, positioning, marketing expenditure levels, and strategies for each marketing mix element.
6. Action programs: spells out how marketing strategies will be turned into specific action programs.
7. Budgets: details a supporting marketing budget that is a projected profit-and-loss statement.
8. Controls: outlines the controls that will be used to monitor progress, allow management to review implementation results, and spot products that are not meeting their goals.

Question 13

Market implementation

Answer 13

Turning marketing strategies and plans into marketing actions to accomplish strategic marketing objectives.
Addresses the who, where, when, and how of the marketing activities.
Many managers think that “doing things right” (implementation) is as important as, or even more important than, “doing the right things” (strategy). The fact is that both are critical to success.

Question 14

Marketing, operating, and strategic control.

Answer 14

Marketing control: Measuring and evaluating the results of marketing strategies and plans.
Operating control: ensures that the company achieves its sales, profits, and other goals.
Strategic control: involves looking at whether the company’s basic strategies are well matched to its opportunities.