Strategic direction - marketing strategies Flashcards
what is the strategic direction
the general path a business takes based on its mission
which factors influence which market businesses operate in
type of product (B2B or B2C), level of competition (growing or saturated), external factors (PESTLE), internal resources, attitude to risk
which factors influence which product businesses produce
research and development strength, competition, technology, finances, external factors
what is market penetration
trying to increase market share in an existing market
what is new product development
selling new products in your existing markets
how is market penetration achieved
through sales promotions, pricing strategies and advertising
where does market penetration work and not work
it works in a growing market but does not work in a saturated market
what is market development (market extension)
selling existing products to new markets
how is market development achieved
when a business focuses on a different segment of the market. However, it depends on how effectively the business researches the market. It can also be done by expanding into new geographical markets
what is diversification
selling new products to new markets
what is the issue with diversification
it is very risky
which tool can be used for growth strategies
Ansoff’s matrix
what are the four sections of Ansoff’s matrix
market penetration, product development, market development and diversification
what is an advantage of Ansoff’s matrix
it forces managers to think about the expected risks of moving in a certain direction
what is a disadvantage of Ansoff’s matrix
it fails to show that market development and diversification strategies also tend to require a significant change in the day-to-day workings of the business
