business objectives and strategy Flashcards
(22 cards)
What is Ansoff’s matrix?
a marketing planning model that helps a business determine its product and market growth strategy and looks at risks involved.
fluctuation of risk depending on enetering new markets.
What does Ansoff’s matrix determine?
the right growth strategies in terms of products it sells ad markets it looks to compete in.
What is market penetration?
A growth strategy where a business aims to sell existing products into existing markets.
What is the aim of market penetration?
The aim is to increase market share by selling more existing products to the same target customers.
Evaluate market penetration
- Busines focuses on markets and products it knows well
- The business can exploit insights on what customers and competitiors want
- It is unlikely to need significant new market research.
What is product development?
A growth strategy where a business aims to introduce new products into existing markets
Evaluate product development
- A strategy that often plays to the strengths of an established business.
- Strong emphasis on effective market reseach and successful innovation
- A great way of exploiting the existing customer base
- Being first to market is usually important.
What is market development?
A growth strategy where the business seeks to sell its existing products into new markets
What are the approaches to market development?
- Expanding into new geographical markets
- New distribution channels
- Different pricing policies to attract new customers
Evaluate market developmet
- A logical strategy where existing markets are saturated or in decline
- Often more risky than product development
- Existing products may not suit new markets.
What is** diversification?**
The growth strategy where a business markets new products in new markets.
Evaluate diversification
- Risky strategy
- No direct experience of the product or market
- Risk of the business can be spread if successful
Approaches to diversification
- Innovation and research & development.
- Acquire an exisiting business in a new market
- Extend an existing brand into a new market
What is forecasting?
Predicting future trends using existing data
What can forecasts be made about?
- sales figures
- costs
- market size
Why would a business use forecasts?
- to prepare and plan research
- stock levels ( increase storage)
- raise finance
- to ensure positive cash flow
What do marketing managers want to know?
- is the market growing?
- customers wants and needs
- who the target market is
- what competitors are doing
Quantitative methods
correlation - the strength of a relationship between two variables
Correlation variables
independant - factor that causes dependant variables to change
dependant - this is informed by independant variables
how do you tell if its a strong or weak correlation?
- the line of best fit indicates the strength of the correlation
- strog correlation means that there is little room between the data points and the line
- weak correlation means that the data points are far away from the line of best fit
- if the data suggests strong correlation, then the relationship might be used to make marketing predictions
Qualitative forecasting
to use views and opinions in reaching decisions about the future. This is often based on previous experiences or on a systematic collection of opinions
delphi technique
Experts are asked their opinions on the likely outcomes of particular business or economic situations. It often takes the form of a questionaire the opinions in the group will converge to a median or average.
