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Chapter 2

MKTG 2030 - Chapter 2.docx

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York University
MKTG 2030
Linda Reeser

MKTG 2030 Week 3 January 20, 2013 CHAPTER 2 – MAKING STRATEGIC MARKETING DECISIONS Plan well and prosper: - Business planning usually occurs on an annual basis at 3 levels: strategic planning, functional/mktg planning, and operational planning (1) Strategic planning – managerial decision process that matches an org’s resources and capabilities to its market opportunities for L/T growth & survival. These decisions focus on the firm’s capability to respond to changes and opportunities in its environment. - CEO, president, top managers define the firm’s mission, vision, and organizational objectives - a cross-section of employees is used to have varied perspectives in the decision process - strategies reflect what a firm is going to do to achieve an objective ex. in order to increase revenues by 10%, Mega Bloks may decide to enter a new market w/ either new/existing products - tactics reflect how a strategy is going to be implemented ex. Mega Bloks may enter a Japanese market w/ a product line customized for the Japanese consumer - strategic plans are usually L/T – 3 to 5 years. This planning can happen at 2 levels: corporate and departmental Five steps in strategic planning: (a) Define the mission - form a mission statement – a formal statement in an org’s strategic plan that describes the overall purpose of the org & what it intends to achieve in terms of its customers, products, and resources - must take customers, products, and resources into perspective – can’t be too narrow (b) Conduct an environmental (situational) analysis - external enviro – uncontrollable elements outside of an org that may affect its performance either positively or negatively. These include macro enviro factors like regulatory or tech factors, consumer behaviour trends, industry factors such as industry concentration, and competitive factors such as the # and sophistication of competitors - PESTO trends – political/legal, economic, social/cultural, technological, or other - consumer analysis used to look for trends, issues, or considerations w/ respect to changing consumer segments, segment profiles, and segment sizes - internal enviro – controllable elements inside an org that influence how well the org operates - understand the resources and competencies of the org.  technology, intellectual capital, etc. - understand the organization of the firm  structure, culture, & systems - beliefs , values, and preferences of senior mgmt. in an org need to be understood for marketers to consider organization-appropriate alternatives in making key market decisions (c) Set organizational or Strategic Business Unit (SBU) objectives - organization and SBU objectives are a direct outgrowth of the mission statement and broadly identify what the firm hopes to accomplish w/in the general time frame of the firm’s long-range business plan. - objectives need to be specific, measurable, and attainable  don’t set “pie in the sky” goals (d) Establish the business portfolio - each SBU is its own profit center w/in the larger corporation – each SBU is responsible for its own costs, revenues, and profits - business portfolio – the group of different brands/products owned by an org and characterized by different income generating and growth capabilities. - having a diversified business portfolio reduces the firm’s dependence on one product line or one group of customers (e) Develop growth strategies - product market growth matrix
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