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BUS 343 (120)
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Chapter 2

Marketing: Real People, Real Decision (3rd Edition): Chapte..
Marketing: Real People, Real Decision (3rd Edition): Chapter 2

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School
Simon Fraser University
Department
Business Administration
Course
BUS 343
Professor
Jason Ho
Semester
Summer

Description
Chapter 2: Making Strategic Marketing Decisions Plan Well and Prosper Planning enables a firm to meet the challenges of this dynamic environment and to control its own destiny Strategic Planning managerial decision process that matches the organizations resources and capabilities to its market opportunities for long-term growth and survival o Focus on firms ability to respond to changes and opportunities in its environment Top management team defines the firms purpose (mission) and what the firm is hoping to achieve over the next few years (organizational objectives) Strategies reflect what a firm is going to do to achieve an objective Tactics reflect how a strategy is going to be implemented Strategic planning can occur in two different levels o Overall corporate strategic planning determines the organizations different business and product pursuits o Individual business units do strategic planning for their products Since strategic planning is usually 3 5 years, firms make 1 year plans called marketing plans o Develops lower-level strategies and tactics for achieving the objectives o Marketing plan contains details regarding the marketing mix elements, strategic plan doesnt Tactics at Strategic level becomes the strategy at the function level, and functional level tactics become operational strategies Development of the marketing plan enables business to set priorities regarding markets it wants to compete in (market segment), customers it wants to serve (target customers), and how it plans to serve those customer (marketing mix strategy) Process is two way process, marketing and other function plans are adapted based on the specific objectives and decisions reflect in operational plan and strategic plans are adapted based on the specific objective and decision reflected in the functional plans Strategic Planning: Guiding the Business Five key stages in top level strategic planning Step 1: Define the Mission Mission statement a formal statement in an organizations strategic plan that describes the overall purpose of the organization and what it intends to achieve in terms of its customers, products and resources www.notesolution.com o Ideal mission statement is not too broad, too narrow, or too short-sighted o Never have a mission statement that would make yourself obsolete o Mission statements should also inspire customers and other stakeholders to want to do business with an organization Step 2: Conduct an Environmental (Situational) Analysis Second step is an assessment of an organizations environment, both external and internal o Referred to as a situation analysis, environmental analysis or sometimes a business review External environment consists of those uncontrollable elements outside of the organization that may affect it either positively or negatively o 4 areas to look at: Political or legal, economic, social or cultural, technology or, other (P.e.s.t.o.) trends of issues that might impact a particular industry and business External environment includes consumer, industry, and competitive analysis Internal environment is all the controllable elements inside an organization that influence how well the organization operates Analysis to understand the decision context (opportunity) o Environmental Analysis External Environment Macro Consumer analysis Industry analysis Competitive analysis Internal Environment Current strategy & performance Organization systems, structure, culture Skills & resources Preferences & values o SWOT analysis SWOT summary Strategy mix o Other Analysis o Marketing Theory, Concepts, Principles Step 3: Set Organizational or SBU objectives Very large corporations are normally divided into self-contained divisions or strategic business units (SBU) Objectives needs to be specific, measurable, and attainable Attainability is important because if it is too high up and cant be attained, then it can create frustration for not only employees but also other stakeholders To ensure measurability, objectives are often stated in numerical terms www.notesolution.comStep 4: Establish the Business Portfolio Each SBU has its own focus within the firms overall strategic plan Business portfolio the group of different products or brands owned by an organization and characterized by different income-generating and growth capabilities Step 5: Develop Growth Strategies Marketers use the product market growth matrix to analyze different growth strategies o Vertical axis represents opportunities for growth, either in existing markets or in new markets o Horizontal axis considers whether the firm would be better off putting its resources into existing products or of it should acquire new products o Provides four fundamental marketing strategies Market Penetration Strategies o Seek to increase sales of existing products to existing markets such as current users, nonusers, or users of competing brands within a market o Might try to increase sales by cutting price, improving distribution, or conducting promotions aimed at attracting users of competing soup brands Market development strat
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