Chapter 2

Chapter 2

1. Strategic planning

   • The managerial process of creating and maintaining a fit between the organization's objectives and resourses and the evolving market oppotunities

2. Strategic business units (SBUs)

   • A subgroup of a single business or collection of related businesses within the larger organization

3. Market penetration

   • A marketing strategy that tries to increase market share among existing customers

4. Market development

   • A marketing strategy that entails attracting new customers to existing products

5. Product development

   • A marketing strategy that entails the creation of new products for present markets

6. Diversification

   • A strategy of increasing sales by introducing new products into new markets

7. Portfolio matrix

   • A tool for allocating resources among products or strategic business units on the basis of relative market share and market growth rate
     • Star
       • In the portfolio matrix, a business unit that is a fast-growing market leader
     • Cash cow
       • In the portfolio matrix, a business unit that generates more cash than it needs to maintain its market share
     • Problem child
       • In the portfolio matrix, a business unit that shows rapid growth but poor profit margins
     • Question mark
       • In the portfolio matrix, a business unit that shows rapid growth but poor profit margins
     • Dog
       • In the portfolio matrix, a business unit that has low growth potential and a small market share

8. Mission statement

   • A statement of the firm’s business based on a careful analysis of benefits sought by present and potential customers and an analysis of existing and anticipated environmental conditions

9. Planning

   • The process of anticipating future events and determining strategies to achieve organizational objectives in the future
     • Marketing planning
       • Designing activities relating to marketing objectives and the changing marketing environment
         • Marketing plan
           • A written document that acts as a guidebook of marketing activities for the marketing manager

10. Marketing myopia

    • Defining a business in terms of goods and services rather than in terms of the benefits customers seek

11. SWOT analysis

    • Identifying internal strengths (S) and weaknesses (W) and also examining external opportunities (O) and threats (T)

12. Environmental scanning

    • Collection and interpretation of information about forces, events, and relationships in the external environment that may affect the future of the organization or the implementation of the marketing plan

13. Competitive advantage

    • A set of unique features of a company and its products that are perceived by the target market as significant and superior to those of the competition
      • Cost competitive advantage
        • Being the low-cost competitor in an industry while maintaining satisfactory profit margins
          • Experience curves
            • Curves that show costs declining at a predictable rate as experience with a product increases

14. product/service differentiation competitive advantage

    • The provision of something that is unique and valuable to buyers beyond simply offering a lower price than that of the competition
    • Niche competitive advantage
      • Thee advantage achieved when a firm seeks to target and effectively serve a small segment of the market
    • Sustainable competitive advantage
      • An advantage that cannot be copied by the competition

15. Marketing objective

    • A statement of what is to be accomplished through marketing activities
    • Marketing strategy
      • The activities of selecting and describing one or more target markets and developing and maintaining a marketing mix that will produce mutually satisfying exchanges with target markets
    • Market opportunity analysis (MOA)
      • The description and estimation of the size and sales potential of market segments that are of interest to the firm and the assessment of key competitors in these market segments
    • Marketing mix
      • A unique blend of product, place (distribution), promotion, and pricing strategies designed to produce mutually satisfying exchanges with a target market
        • Four Ps
          • A unique blend of product, place (distribution), promotion, and pricing strategies designed to produce mutually satisfying exchanges with a target market

16. Implementarion

    • Thee process that turns a marketing plan into action assignments and ensures that these assignments are executed in a way that accomplishes the plan’s objectives

17. Evaluation

    • Gauging the extent to which the marketing objectives have been achieved during the specified time period
      • Control
        • Provides the mechanisms for evaluating marketing results in light of the plan’s objectives and for correcting actions that do not help the organization reach those objectives within budget guidelines

18. Marketing audit

    • A thorough, systematic, periodic evaluation of the objectives, strategies, structure, and performance of the marketing organization