Topic 3: Planning, Strategy and the Marketing Environment

Question 1

strategic planning

Answer 1

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

Question 2

the strategic planning process

Answer 2

At the corporate level, the organisation starts the strategic planning process by defining its overall purpose and mission .
This mission is then turned into detailed supporting objectives that guide the whole organisation.
Next, headquarters decides what portfolio of businesses and products is best for the company and how much support to give each one.
In turn, each business and product develops detailed marketing and other departmental plans that support the company-wide plan. Thus, marketing planning occurs at the business-unit, product and market function levels. It supports company strategic planning with more detailed plans for specific marketing opportunities.

Question 3

mission statement

Answer 3

is a statement of the organisation’s purpose – what it wants to accomplish in the larger environment. A clear mission statement acts as an ‘invisible hand’ that guides people in the organisation.

Question 4

Setting company objectives and goals

Answer 4

The marketing organisation needs to turn its mission into detailed supporting objectives for each level of management. Each manager should have objectives and be responsible for reaching them

Question 5

Designing the business portfolio

Answer 5

The best business portfolio is the one that best fits the company’s strengths and weaknesses to opportunities in the environment.

Question 6

Business portfolio planning involves two steps

Answer 6

First, the company must analyse its current business portfolio and decide which businesses should receive more, less or no investment.
Second, the company must shape the future portfolio by developing strategies for growth and downsizing.

Question 7

business portfolio

Answer 7

this is the collection of businesses and products that make up the company

Question 8

market penetration

Answer 8

that is, by making more sales without changing its original product lines

Question 9

market development

Answer 9

identifying and developing new markets for its current products.

Question 10

product development

Answer 10

offering modified or new products to current markets

Question 11

diversification

Answer 11

starting up or buying businesses outside of its current products and markets

Question 12

Describe the elements of a customer-driven marketing strategy and mix,

Answer 12

1)Customers stand in the centre. The goal is to create value for customers and build profitable customer relationships.
2) Next comes marketing strategy – the marketing logic by which the company hopes to create this customer value and achieve these profitable relationships. The company decides which customers it will serve (segmentation and targeting) and how (differentiation and positioning). 3) Guided by marketing strategy, the company designs an integrated marketing mix made up of factors under its control – product, price, placement logistics, promotion, people, process and physical evidence.
4) To find the best marketing strategy and mix, the company engages in marketing analysis, planning, implementation and control. Through these activities, the company watches and adapts to the actors and forces in the marketing environment. We now look briefly at each activity. Then, in later chapters, we discuss each one in more depth.

Question 13

marketing mix

Answer 13

the set of controllable, tactical marketing tools that the company blends to produce the response it wants in the target market.

Question 14

the extended marketing mix’

Answer 14

product, price, placement logistics, promotion, people, process and physical evidence.

Question 15

Product

Answer 15

means the combination of goods and services that the company offers to the target market

Question 16

Price

Answer 16

is the amount of money customers must pay to obtain the product

Question 17

Placement logistics

Answer 17

includes company activities that make the product available to target customers and end-consumers

Question 18

Promotion

Answer 18

means activities that communicate the merits of the product and persuade target customers to buy it.

Question 19

People.

Answer 19

Services are often people-based,

Question 20

Process

Answer 20

When Ford Focus owners take their car in for service, or when people check-in or -out of airlines, hotels and motels

Question 21

Physical evidence

Answer 21

Often, it is necessary to manage customer and potential customer expectations, commencing with an explanation of the criteria to use when comparing products

Question 22

Managing the marketing process requires the four marketing management functions

Answer 22

analysis, planning, implementation and control

Question 23

Marketing analysis

Answer 23

Managing the marketing function begins with a complete analysis of the marketing organisation’s situation. The marketer should conduct a SWOT analysis, by which it evaluates the company’s overall strengths (S), weaknesses (W), opportunities (O) and threats (T)

Question 24

Marketing planning

Answer 24

Marketing planning involves deciding on marketing strategies that will help the company attain its overall strategic objectives. A detailed marketing plan is needed for each business, product or brand

Question 25

Marketing implementation

Answer 25

is the process that turns marketing plans into marketing actions in order to accomplish strategic marketing objectives. Whereas marketing planning addresses the what and why of marketing activities, implementation addresses the who, where, when and how.

Question 26

Marketing control

Answer 26

evaluating the results of marketing strategies and plans, and taking corrective action to ensure that objectives are attained.

Question 27

Marketing control involves four steps

Answer 27

Management first sets specific marketing goals. It then measures its performance in the marketplace and evaluates the causes of any differences between expected and actual performance. Finally, management takes corrective action to close the gaps between its goals and its performance. This may require changing the action programs or even changing the goals.

Question 28

The marketing environment is made up of

Answer 28

microenvironment and a macroenvironment

Question 29

The company’s microenvironment

Answer 29

Marketing success will require building relationships with other company departments, suppliers, marketing intermediaries, competitors, various publics and customers that combine to make up the company’s value delivery network.

Question 30

public

Answer 30

is any group that has an actual or potential interest in or impact on an organisation’s ability to achieve its objectives

Question 31

We can identify seven types of publics:

Answer 31

•Financial publics. This group influences the company’s ability to obtain funds.
•Media publics. This group carries news, features and editorial opinion.
•Government publics. Management must take government developments into account.
•Citizen-action publics. A company’s marketing decisions may be questioned by consumer organisations, environmental groups, minority groups and others.
•Local publics. This group includes local residents and community organisations.
•General public.
•Internal publics. This group includes workers, managers, volunteers and the board of directors.

Question 32

The company’s macroenvironment

Answer 32

Demographic
Economic
Natural
Technological
Political
Cultural

Question 33

economic environment

Answer 33

consists of factors that affect consumer purchasing power and spending patterns

Question 34

Demographic environment

Answer 34

human populations in terms of size, density, location, age, gender, race, occupation and other statistics.

Question 35

natural environment

Answer 35

involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities

Question 36

Technological environment

Answer 36

Forces that create new technologies, creating new products and market opportunities.

Question 37

political environment

Answer 37

consists of laws, government agencies and pressure groups that influence or limit various organisations and individuals in a given society.

Question 38

Cultural environment

Answer 38

is made up of institutions and other forces that affect a society’s basic values, perceptions, preferences and behaviours