Marketing - Chapter 2 Review

Describe the elements of a customer-driven marketing strategy and mix and the forces that influence it: (pg. 48-53)

Customer value and relationships are at the center of marketing strategy and programs. Through market segmentation, targeting, differentiation, and positioning, the company divides the total market into smaller segments, selects segments that it can best serve, and decides how it wants to bring value to target consumers in the selected segments . It then designs an integrated marketing mix to produce the response it wants in the target market. The marketing mix consists of product, price, place, and promotion decisions (the 4 P's).

Discuss how to design business portfolios and develop growth strategies: (pg. 40-45)

Guided by the company's mission statement and objectives, management plans its business portfolio, or the collection of business and products that make up the company. The firm wants to produced a business portfolio that best fits its strengths and weaknesses to opportunities in the environment. To do this, it must analyze and adjust its current business portfolio and develop growth and downsizing strategies for adjusting the future portfolio. The company might use a formal portfolio-planning method. But many companies are now designing more-customized portfolio-planning approaches that are better suited to their unique situations.

Explain company-wide strategic planning and its four steps: (pg. 38-40)

Strategic planning sets the stage for the rest of the company's planning. Marketing contributes to strategic planning, and the overall plan defines marketing's role in the company. Strategic planning involves developing a strategy for long-run survival and growth. It consists of four steps: (1) defining the company's mission, (2) setting objectives and goals, (3) designing the business portfolio, and (4) developing functional plans. The company's mission should be market oriented, realistic, specific, motivating, and consistent with the market environment. The mission is then transformed into detailed supporting goals and objectives, which in turn guide decisions about the business portfolio. Then each business and product unit must develop detailed marketing plans in line with the company-wide plan.

List the marketing management functions, including the elements of a marketing plan, and discuss the importance of measuring and managing return on marketing investment: (pg. 53-58)

To find the best strategy and mix and to put them into action, the company engages in marketing analysis, planning, implementation, and control. The main components of a marketing plan are the executive summary, the current marketing situation, threats and opportunities, objectives and issues, marketing strategies, action programs, budget and controls. To plan good strategies is often easier than to carry them out. To be successful, companies must also be effective at implementation - turning marketing strategies into marketing actions. Marketing department can be organized in one or a combination of ways: functional marketing organization, geographic organization, product management organization, or market management organization. In this age of customer relationships, more and more companies are now changing their organizational focus from product or territory management to customer relationship management. Marketing organizations carry out marketing control, both operating control and strategic control. Marketing managers must ensure that their marketing dollars are being well spent. In a tighter economy, today's marketers face growing pressures to show that they are adding value in line with their costs. In response, marketers are developing better measures of return on marketing investment. Increasingly, they are using customer-centered measures of marketing impact as a key input into their strategic decision making.

Explain marketing's role in strategic planning and how marketing works with its partners to create and deliver customer value. (pg. 45-47)

Under the strategic plan, the major functional departments - marketing, finance, accounting, purchasing, operations, information systems, human resources, and others, must work together to accomplish strategic objectives. Marketing plays a key role in the company strategic planning by providing a marketing concept philosophy and inputs regarding attractive market opportunities. Within individual business units, marketing designs strategies for reaching the unit's objectives and helps to carry them out profitably . Marketers alone cannot produce superior value for customers. Marketers must practice partner relationship management, working closely with partners in other departments, to form an effective value chain that serves the customer. And they must partner effectively with other companies in the marketing system to form a competitively superior value delivery network.