Ch. 2 and 3 Flashcards
(71 cards)
Distinguish between strategic planning and tactical planning.
- Strategic planning is the process of identifying an organization’s primary objectives and adopting courses of action toward these objectives. In other words, strategic planning focuses on the big picture of which industries are central to a firm’s business.
- Tactical planning guides the implementation of the activities specified in the strategic plan. Once a strategy is set, operational managers devise methods (tactics) to achieve the larger goals.
Explain how marketing plans differ at various levels in an organization.
Top management spends more time engaged in strategic planning than middle- and supervisory-level managers, who tend to focus on narrower tactical plans for their units. Supervisory managers are more likely to develop specific plans designed to meet the goals assigned to them—for example, streamlining production processes so that they operate more efficiently.
Identify the six steps in the marketing planning process.
The basic steps in the marketing planning process are defining the organization’s mission and objectives; assessing organizational resources and evaluating environmental risks and opportunities; and formulating, implementing, and monitoring the marketing strategy.
Describe successful planning tools and techniques, including Porter’s Five Forces model, first and second mover strategies, SWOT analysis, and the strategic window.
Porter’s Five Forces are identified as the five competitive factors that influence planning strategies: potential new entrants, bargaining power of buyers, bargaining power of suppliers, threat of substitute products, and rivalry among competitors. With a first mover strategy, a firm attempts to capture the greatest market share by being first to enter the market; with a second mover strategy, a firm observes the innovations of first movers and then attempts to improve on them to gain advantage. SWOT analysis (strengths, weaknesses, opportunities, and threats) helps planners compare internal organizational strengths and weaknesses with external opportunities and threats. The strategic window identifies the limited periods during which the key requirements of a market and the competencies of a firm best fit together.
Identify the two basic elements of a marketing strategy.
Development of a marketing strategy is a two-step process:
- selecting a target market and
- designing an effective marketing mix to satisfy the chosen target.
- The target market is the group of people toward whom a company decides to direct its marketing efforts.
- The marketing mix blends four strategy elements to fit the needs and preferences of a specific target market: product strategy, distribution strategy, promotion strategy, and pricing strategy.
Describe the environmental characteristics that influence strategic decisions.
The five dimensions of the marketing environment are competitive, political–legal, economic, technological, and social–cultural. Marketers must also address growing concern about the natural environment, including new regulations, and increasing cultural diversity in the global marketplace.
Describe the methods for marketing planning, including business portfolio analysis and the BCG matrix.
- The business portfolio analysis evaluates a company’s products and divisions, including strategic business units (SBUs). The SBU focuses the attention of company managers so that they can respond effectively to changing consumer demand within certain markets.
- The BCG (Boston Consulting Group) matrix places SBUs in a four-quadrant chart that plots market share against market growth potential. The four quadrants are stars, cash cows, dogs, and question marks.
Define planning
Planning is the process of anticipating future events and conditions and of determining the best way to achieve organizational objectives.
How do marketing plans vary at different levels of the organization?
Top managers usually focus their planning activities on long-range strategic issues. In contrast, middle-level managers focus on operational planning, which includes creating and implementing tactical plans for their own units. Supervisors develop specific programs to meet the goals in their areas of responsibility.
Why is it important to get input from others when planning?
Input from a variety of sources—other employees, suppliers, or customers—helps ensure that many ideas are considered. Involving those people in planning can also turn them into advocates for the plan.
Distinguish between an organization’s mission and its objectives.
The firm’s mission is the essential purpose that differentiates the company from others. Its objectives guide development of supporting marketing objectives and plans.
Ex: Avon’s mission is to be “the company for women.” One of its objectives might be to convert all its packaging to recycled materials.
What is the importance of the final step in the marketing planning process?
In the final step of the marketing planning process, managers monitor performance to ensure that objectives are achieved.
Briefly explain each of Porter’s Five Forces.
Porter’s Five Forces are the threats of potential new entrants, which increases competition in a market; bargaining power of buyers, which can depress prices; bargaining power of suppliers, which can increase costs or reduce selection; threat of substitute products, which can lure customers to other products; and rivalry among competitors, which can bring about price wars or divert companies from their main goals.
What are the benefits and drawbacks of a first mover strategy?
The benefits of a first mover strategy include capturing the greatest market share and developing long-term relationships with customers. Disadvantages include the possibility that companies that follow can learn from mistakes by first movers.
Ex: Procter & Gamble has been a first mover with its line of Swiffer products.
What are the four components of the SWOT analysis? What is a strategic window?
SWOT analysis helps planners compare internal organizational strengths and weaknesses with external opportunities and threats. SWOT is an acronym for strengths, weaknesses, opportunities, and threats. A strategic window defines the limited periods when key requirements of a market and a firm’s particular competencies best fit together.
Identify the four strategic elements of the marketing mix.
The marketing mix consists of product, distribution (place), promotion, and pricing strategies.
What are the five dimensions of the marketing environment?
The five dimensions of the marketing environment are competitive, political–legal, economic, technological, and social–cultural factors.
How is concern over the natural environment affecting the other dimensions?
Concerns over the natural environment have led to new and tighter regulations on pollution, which affect the political–legal environment in which marketers operate. Efforts toward sustainability are now social–cultural factors as well, because consumer awareness is turning into consumer preference.
What are SBUs?
Strategic business units (SBUs) are key business units within diversified firms. Each SBU has its own managers, resources, objectives, and competitors.
Identify the four quadrants in the BCG matrix.
The BCG matrix labels SBUs stars, cash cows, question marks, and dogs. Stars are the products with high market shares in high-growth markets; cash cows command high market shares in low-growth markets; question marks achieve low market shares in high-growth markets; and dogs manage only low market shares in low-growth markets.
Define marketing planning
Implementing planning activities devoted to achieving marketing objectives.
Define strategic planning
Process of determining an organization’s primary objectives and adopting courses of action that will achieve these objectives.
What is a mission?
Essential purpose that differentiates one company from others.
Compare first mover strategy and second strategy. Give an example.
-Theory advocating that the company first to offer a product in a marketplace will be the long-term market winner.
-Theory that advocates observing closely the innovations of first movers and then improving on them to gain advantage in the marketplace.
examples are Target and Walmart, Myspace and Facebook. ect
