Marketing Chapter 2

Value delivery network

The network made up of the company, its suppliers, distributors, and customers who partner with each other to improve the performance of the entire system

Strategic planning

The process of developing and maintaining a strategic fit between the organization's goals and capabilities and its changing marketing opportunities - Sets the planning for the rest of the firm

Market targeting

The process of evaluating each market segment's attractiveness and selecting one or more segments to enter - A company should target segments in which it can profitably generate the greatest customer value and sustain it - Most companies enter a new market by serving a single segment and then add more segments if successful

Marketing implementation

The process that turns marketing strategies and plans into marketing actions to accomplish strategic marketing objectives - Addresses the who, where, when and how - Easier to think of good marketing strategies than to implement them

Value chain

The series of internal departments that carry out value-creating activities to design, produce, market, deliver and support a firm's products - Success of a firm depends on how well each department performs but how well the departments coordinate their activities - A company's value chain is only as strong as its weakest link - Should try to get all the departments to "think consumer"

Product/market expansion grid

Useful for identifying growth opportunities - Illustrates different growth strategies - Has two dimensions: Opportunities for growth in existing or new markets Allocating resources into existing products or new products - Market penetration - Market development - Product development - Diversification

Geographic organization

A company that sells across the country or internationally often uses this

Market segment

A group of consumers who respond in a similar way to a given set of marketing efforts

Mission statement

A statement of the organization's purpose, what it wants to accomplish in the larger in environment - A clear one acts as an "invisible hand" that guides people in the organization - Should be market oriented and defined in terms of satisfying basic customer needs - Should be meaningful, specific and motivating - Emphasize company strengths and how it intends to win the marketplace - Should focus on customers and the customer experience the company seeks to create

Differentiation

Actually differentiating the market offering to create superior customer value

SWOT analysis

An overall evaluation of the company's strengths (S), weaknesses (W), opportunities (O), and threats (T)

Positioning

Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers - Where do you want your product to sit within the minds of consumers

Market development

Company growth by identifying and developing new market segments for current company products

Market penetration

Company growth by increasing sales of current products to current market segmentsmM without changing the product

Product development

Company growth by offering modified or new products to current markets

Diversification

Company growth through starting up or acquiring businessess outside the company's current products or markets

Functional organization

Different marketing activities are headed by functional specialists

Market segmentation

Dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors, and who might require separate products or marketing programs - Every market has segments

Place

Includes the company activities that make the product available to target consumers

Operational control

Involves checking ongoing performance against the annual plan and taking corrective action when necessary - purpose is to ensure company achieves sales, profits and other goals

Marketing planning

Involves choosing marketing strategies that will help the company attain its overall strategic objectives

Strategic control

Involves looking at whether the company's basic strategies are well matched to its opportunities

Strategic business units

Key businesses that make up the company - Can be a company division, a product line, or a single product or brand - A company should assess the attractiveness of these and decide how much support each deserves.

Marketing control

Measuring and evaluating the results of marketing strategies and plans and taking corrective action to ensure that the objectives are acheived

Marketing mix

One of the major concepts in modern marketing - The set of tactical marketing tools, product, price, place, promotion that the firm blends to produce the response it wants in the target market - Consists of everything the firm can do to influences the demand for its products

The marketing concept

Suggests the company strategy should revolve around creating customer value and building profitable relationships with important consumer groups

Promotion

The activities that communicate the merits of the product and persuade target customer to buy it

Price

The amount of money customers must pay to obtain the product

Business portfolio

The collection of businesses and products that make up the company

Product

The goods and services combination the company offers to the target market

Marketing strategy

The marketing logic by which the company hopes to create this customer value and achieve these profitable customer relationships