Chapter 2
Downsizing
when a company must prune, harvest or divest businesses that are unprofitable or that no longer fit the strategy
Steps in Strategic planning
1. Defining the company's mission 2. Identified customer's objective and goals 3. Developing business portfolio 4. Planning marketing and other functional strategies
Problem with Matrix approaches
1. Difficulty in defining SBUs and measuring market share and growth 2. Time consuming 3. Expensive 4. Focus on current businesses and not future planning
Strategic business units
1. company division 2. product line within a division 3. single product or brand
Analyzing the current business portfolio
1. identify strategic business units. 2. Assess the attractiveness of its various SBUs 3. Decide how much support each SBU deserves
To find the best marketing stragety
Analysis, planning, implementation and control
Marketing/ Product strategy
Build ( Transform question mark to star) Hold (maintain- stars and strong cash cows) Harvest ( get short term profits- week cows, question markets and strong dogs) Divest (liquidate businesses that tie up resources- dog)
Business portfolio
Collection of businesses and products that make up the company
Community-oriented
Communities of customer who talk not just with the company about the brand but with each other as well
Market development
Identifying and developing new market for its current product, EX: new demographic markets, new group, new geographic area, Disney
Business unit strategy
Manage your portfolio
Mission Statement
Organization's purpose, what it wants to accomplish in the larger environment
Growth-share matrix
Portfolio- planning method that evaluates a company's SBUs in terms of market growth rate and relative market share
Marketing Mix
Price, product, promotion and place
Strategic planning
Process of developing and maintaining a strategic fit between the organization's goal and capabilities, and its changing marketing opportunities
Marketing analysis
SWOT analysis
Marketing strategy
Segmentation, targeting, differentiation, positioning
Diversification
Starting up or buying business beyond its current product and market EX: starbucks tea, toyota launch lexus
Product/ Market expansion grid
looks at new products, existing products, new markets, and existing markets for company growth opportunities
Portfolio analysis
major activity in strategic planning whereby management evaluates the products and businesses that make up the company`
Market penetration
making more sales to current customers without changing its original product. EX. adding new store, adding new food and beverage offering. adding services or redesigning menu
Product development
offering modified or new product to the current market EX: instant coffee, k-sup