Transcript Market - simion.ca

Chapter 2
Instructor Shan A. Garib, Fall 2012
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Market:
Any place where buyers and sellers can
exchange goods and services
Eg. Ebay, supermarket, classroom
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Strategic Planning: creating and maintaining a fit between
organizational objective, resources and market opportunities
-long term profitability and growth
-commit resources
-wrong decisions threaten survival
Questions:
1.
2.
What is the main activity?
How reach goals?
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Planning: anticipating future events and determining strategies
to reach objectives
Marketing Plan: document guidebook for marketing activities
Why Write a Marketing Plan?
-define objectives, identify actions needed to reach goals
-common goals for managers and workers
-compare actual and expected performance
-anticipate problems
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Defined:
1.Mission
2.Objectives
3.Situation Analysis – SW/OT
4.ID Target Market
5.ID Marketing Mix (Product, Place/Distribution,
Promotion, Price)
6.Implementation
7.Other: Budgets (time, money), research
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Mission Statment: what business are we in??
-analysis of benefits sought by customers
-focuss on markets served
Sales oriented vs. Market oriented
Marketing Myopia: defining business interms of
goods and services not, customer wants
Also want to define things interms of business
within company – strategic business units
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Marketing Objective: statement of what is to be
accomplished through marketing
Should:
1. realisitc, measurable, time specific
“Achieve 10% of market share with in 12 months”
2. Indicate priorities of business
“...and introduce 5 new products in the next year”
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Marketing Objective: statement of what is be to
accomplished through marketing
Serve Several Functions:
1.Communicate
management philisophies
-provide direction for marketing managers
2.Motivation to strive
3.Used for control
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Before marketing activities are defined,
marketers must understand the current and
potential environment internally and externally
Internal: organizational resources
Strengths
Weakens
eg. Costs, skills budget
External: environmental scanning
Opportunity
Threats
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Use SWOT to identify your...
Competitve Advantage: unique features make
product superior to competitors
Types
A. Cost
B. Product/Service differentiation
C. Niche strategies
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Competitive Advantage: unique features make
product superior to competitors
A. Cost Competitive Advantage – getting low cost
raw materials, efficiently produce item, having
easily manufactured products
Cost Competitive Advantage: being a low cost
compeitor in the industry while making a profit
leasing to superior customer value
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Cost advantage – getting low cost raw materials,
efficiently produce item, having easily
manufactured products
Costs reduced through:
1. Experience curves – costs go down as
experience with a product increases
-reflect learning by doing, technological
advances eg. Salad making
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Cost advantage – getting low cost raw materials,
efficiently produce item, having easily
manufactured products
Costs reduced through:
2. Efficient Labour – outsourceing
3. No-frills goods and services – eg WestJet no
meals
4. Government Subsidies – no interest loans
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Cost advantage – getting low cost raw materials,
efficiently produce item, having easily
manufactured products
Costs reduced through:
5. Product Design – make product easy to
produce
6. Re-engineering – rethink and redesign
processes
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Cost advantage – getting low cost raw materials,
efficiently produce item, having easily
manufactured products
Costs reduced through:
7. Product Innovations – make production easier
8. New Methods of Service Delivery – online
ordering
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Competitive Advantage: unique features make
product superior to competitors
B. Product /Service Differentiation Competitive
Advantage – longer lasting advantage, providing
value beyond low price eg. Brand names based
on quality
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Competitve Advantage: unique features make
product superior to competitors
C. Niche Competitive Advantage – target and
serve single market
-usually for smaller companies with limited
not able to compete with larger competitors
eg. Serve only certain age group, geographical
area
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Competitve Advantage: unique features make
product superior to competitors
A Sustainable Competitive Advantage – cannot
be copied by competitors, consumers have no
reason why to patronize competitors eg. Rolex
-created through:
1. skills – superior customer service
2. assets – patents, superior
-imitation by competitors indicates lack of
competitive advantage
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Result of SWOT and identification of a
Competitive Advantage is ability of evaluate
strategic direction of firm
◦ Next step in marketing planning is selecting a
strategic alternative
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Selecting a strategic alternatives
To discover marketing opportunities management must
identify alternatives
Ansoff Matrix develops alternatives by matching
products with markets through four options:
1.Market penetration – increase market share among
EXISTING CUSTOMERS
2.Market development – attracting NEW CUSTOMERS
3.Product development – create new products for
existing customers eg. Green cars
4.Diversification – introducing new products into new
markets eg. Davidoff cigarettes makes cologne
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Selecting a strategic alternatives
Threats:
External threats arise from political, economic,
social, technological (PEST) forces. Technological
developments may make your offerings obsolete.
Market changes may result from the changes in the
customer needs, competitors' moves, or
demographic shifts. The political situation
determines government policy and taxation
structure.
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Marketing Strategy involves selecting and
describing market segments
Market Segment: group sharing
characteristics with similar product needs eg.
Students
A target marketing strategy involves using a
market opportunity analysis which is the
description and estimation of size of market
and sales potential, assessment of
competitors in segment
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Marketing Mix: blend of product,
place/distribution, promotion, pricing (four
P’s) to bring about maximal value of
exchange
-use to gain advantages over competitors
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Marketing Mix:
Product – package, warranty, after sales
support, image
Place – making products available when and
where customers want them
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Marketing Mix:
Promotion – advertising, public relations,
sales promotion, personal selling
– informing, education and
persuading
Pricing – what buyer must give up to get
product
- quickest to change
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
Implimentaition: turns marketing plan into
action to accomplish plan’s objectives
-involves:
-detailed job assignments
-timelines
-budgets
Evaluation and Control – after marketing plan
implimentation
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Evaluation: gauging the extent to which
marketing objectives have been achieved
Common reasons for failing to achieve
objectives:
1.Unrealistic
objectives
2.Inappropriate marketing strategies
3.Poor implimentation
4.Changes in the environment
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Control: correcting actions that do not help
organization help achieve objectives
done through...
Marketing Audit: periodic
evaluation of the objectives and performance
of organization
-manage marketing resources
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Marketing Audit characteristics:
a) comprehensive coverage of marketing
issues, good and bad
b) Systematic and orderly
c)Independantly conducted to be objective
d)Periodicly carried out on a scheduled
timeline not only during crisis
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Strategic planning: requires continual
attention, creativity, and management’s
commitment
-should be an ongoing process because
environment is continually changing and
resources continually evolving
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