Transcript BUSI 160 Principles of Marketing

BUSI 406
PRINCIPLES OF MARKETING:
EVALUATING OPPORTUNITIES IN THE CHANGING
MARKET ENVIRONMENT
CHAPTER 3
Today’s Agenda
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Answer any questions
Team Assignments
If you have any questions/issues with your team, please see
me ASAP – the longer you wait, the less I can help you…
 Team Assignments are for all 3 Case Assignments and major
project
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Review Guidelines for Marketing Cases
Let’s Review
Discuss material you read in Chapter 3 of your
textbook
Guidelines for Marketing Cases
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Due date for first case assignment – Waimate Springs Lodge (pg. 628) is
Wednesday, February 1
Prepare an original team 2 page max plus exhibits (12 pt. font, reasonable margin,
double spaced text) write-up of the case based only on your own work focusing on:
 Current situation
 Analysis of the situation (3Cs, SWOT)
 Assess possible strategy options, including no change, and recommend an overall
strategy, explain why you recommend this strategy
 Specific action plan and implementation (Target Mkt, 4 Ps)
 Highlights from three to five year annual financial pro forma – BEP?
Exhibits are good, but optional – may be used for SWOT or 3 to 5 year annual
financial pro forma and other material, highlight within 2 page text
Biggest piece of advice – do not focus on what is already in the case…tell me
something new!
Let’s Review
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Marketing strategy planning & marketing strategy
3 C’s SWOT, Target marketing & 4 P’s in a marketing
mix
Attractive Opportunities
Breakthrough opportunities
 Competitive Advantage
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Four Generic Growth Strategies
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Market Penetration, Market Development, Product
Development, Diversification
Today’s Goals
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Examine two of the 3 C’s
 Company
objectives & mission statements
 Competitive environment
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Review the major trends in the External Market
Environment
 Economic
environment
 Technological environment
 Political/Legal environment
 Cultural/Social environment
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Screening opportunities using the GE Planning Grid
and the BCG Growth/Share Matrix
What is Marketing Strategy Planning? Finding attractive opportunities
and developing sustainable marketing strategies, and being rewarded
financially for doing so.
Marketing Strategy Planning involves:
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3C’s: Company, customers, competitors SWOT analysis
Marketing Strategy: Specifying a target market and a related marketing
mix
Target Market: a fairly homogenous group of customers to whom a
company wishes to appeal
Marketing Mix: the controllable variables (4 P’s) the company puts
together to serve this target group
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Product
Place
Price
Promotion and communication
Pro forma Budget: A plan without a budget is not a plan, show me the
numbers, expected revenues against expected expenses, plus other outcome
metrics
Marketing Strategy Planning Process
Marketing Strategy Planning, Competitors, Company,
& External Market Environment (See page 522)
Company
•Objectives
•Resources
Competitors
•Current
•Prospective
External Marketing Environment
•Economic
•Technological
•Political & Legal
•Cultural & Social
Evaluating Multiple Opportunities
•Screening criteria
•Planning grids
Best opportunities to pursue
The Marketing Environment (See page 522 in text)
Customers
Resources
and Objectives
of the Firm
Direct Marketing
Environment
Cultural and
Social
Environment
Political and
Legal Environment
Competitive
Environment
Economic
Environment
External Marketing
Environment
Technological
Environment
Mission Statement
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A mission statement helps set the course and basic
purpose for being.
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The whole firm should work toward these same objectives.
Company Resources May Enable or Limit Pursuit of
Opportunities
Financial Strength
Producing Capability and
Flexibility
Marketing Strengths
The Competitive Environment -- Analyzing
Competition
Competitor
Analysis
Competitive
Advantage
Key
Concepts
Competitive
Barriers
Competitive
Rivals
Competitive Barriers
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Entry Barriers: how difficult is it to enter the industry?
Mobility Barriers: once you’ve entered the industry,
there may be some segments that are hard to access.
Exit Barriers: how difficult is it to leave the industry?
The Economic Environment
Global
Economy
Rapid Change
Key
Economic
Forces
Interest Rates
Technological Environment
The Political and Legal Environment – See Exhibit 3-4
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Key Antimonopoly
Laws
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Consumer Protection
Agencies
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Sherman Antitrust Act (1890)
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Federal Trade Commission (FTC)
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Clayton Act (1914)
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Food and Drug Administration (FDA)
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Federal Trade Commission
(1914)
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Robinson-Patman Act (1936)
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Wheeler-Lea Amendment (1938)
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Antimerger Act (1950)
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Magnuson-Moss Act (1975)
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Consumer Product Safety Commission
(CPSC)
Federal Communications Commission
(FCC)
Environmental Protection Agency
(EPA)
Keeping Competitive in the Changing Cultural &
Social Environment
Keeping Competitive in the Changing Cultural &
Social Environment
Population Trends
Increasing Density
Increasing Urbanization
NC and Southeastern population growth is expected
to continue, as is the Southwestern US
2010 Population (in millions)
Percent Change by State, 2000–2010
US Growth Trends
Key Trends
Graying of America
Gen X – fewer in number;
Gen Y – tech savvy
Diversity Explosion
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Whose Population is Aging the Fastest?
Median Age
Country
Japan
Germany
Italy
France
United Kingdom
1970
28.9
34.3
33.1
32.5
34.2
2010
44.7
44.3
43.3
40.1
39.9
2050
55.1
51.7
50.5
44.8
42.5
Russia
United States
China
Thailand
Brazil
30.6
28.2
19.7
17.7
18.6
38.1
36.6
34.2
33.2
29.0
44.0
41.7
45.2
41.4
45.6
Indonesia
Mexico
Vietnam
India
Philippines
18.9
16.6
18.0
19.2
17.1
28.2
27.6
28.5
25.0
23.2
41.1
43.9
42.4
38.4
35.0
Source: United Nations Population Division. World Population Prospects, the 2008 Revision.
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Japan: Face of the Future
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Source: New York Times, September 2, 1997.
“Diversity Explosion” (William Frey, Brookings Institute, 2014) and the “Next
America” (Paul Taylor, PEW Research Center, 2016) highlight how the America of
tomorrow will look different from the America of the past…
Screening Criteria Narrow Down Strategies
Product-Market
Screening Criteria
Qualitative “Fit”
Criteria
Quantitative
“Data” Criteria
GE’s Strategic Planning Grid Helps Evaluate a
Portfolio of Opportunities
Industry Attractiveness
Medium
Low
Medium
No Growth
Low
Business Strengths
High
High
Borderline
Growth
Analyzing the Current Business Portfolio of Strategic
Business Units (SBUs) Using BCG’s Growth Share Matrix
Boston Consulting Group’s Growth Share Matrix
H
Market Growth Rate
Star ???
Cow Dog
L
H
L
Relative Market Share
Summary
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Marketing does not take place in a vacuum!
 Success
depends on anticipating changes (both
opportunities and threats) in the marketing environment.
 Marketing can be “reactive or proactive” - which do
you want to be?
For Next Class…
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Please read Chapter 4 “Focusing Marketing Strategy
with Segmentation and Positioning”