Marketing Exam Ch 2

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ORGANIZATION

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Legal entity that consists of people who share a commonmission. This motivates them to develop offerings (goods, services, or ideas) thatcreate value for both the organization and its customers by satisfying theirneeds and wants.

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3 TYPES OF ORGANIZATIONS

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1. FOR PROFIT

2. NONPROFIT

3. GOVT AGENCIES

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FOR PROFIT ORGINZATION (BUNIESS FIRM)

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Is a privately ownedorganization such as Target, Nike, or Cree that serves its customers to earn aprofit so that it can survive

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Profit

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the money left after a for-profit organiza-tion subtracts its total expenses from its total revenues and is the reward for the risk it undertakes in marketing its offerings.

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NON FOR PROFIT ORGANIZATION

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nongovernmental organization that serves its customers but does not have profit as an organizational goal.Instead, its goals may be operational efficiency or client satisfaction. Regard-less, it also must receive sufficient funds above its expenses to continue opera-tions.( TEACH FOR AMEIRCA)

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GOVT AGENCY

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a federal, state, county, or city unit that pro-vides a specific service to its constituents.

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Organizations that develop similar offerings create an______

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INDUSTRY

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STRATEGY

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an organization’slong-term course of action designed to deliver a unique customer experience whileachieving its goals

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CORPORATE LEVEL

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top management directs overall stratgey for entire organization (board of directors) and CEO

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3 levels of strategy

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1. corporate

2. strategic business unit

3. functional

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STRATEGIC BUSNIESS UNIT LEVEL

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managers set a more specific strategic direction for their businessesto exploit value-creating opportunities

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FUNCTIONAL LEVEL

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there groups of specialists actually create value for the organization (finance, research and development, marketing, manufacturing operations, human resources)

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What are examples of a functional level in an organization?

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(finance, research and development, marketing, manufacturing operations, human resources)

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LO 2-2 Describe corevalues, mission,organizationalculture, business,and goals.

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cc

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3 elements of organizational foundation

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1. core values

2. mission

3. organizational culture

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core values

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f the fundamental, passionate,and enduring principles that guide its conduct over time

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mission

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a statement of the organization’s function in society that often identifies itscustomers, markets, products, and technologies. (have a clear mission statement)

ex Red Cross: “To prevent and alleviate human suffering in the face of emer-gencies by mobilizing the power of volunteers and the generosity of donors.”1

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organizational culture

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the set of values, ideas, atti-tudes, and norms of behavior that is learned and shared among themembers of an organization.

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business

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describes the clear, broad, underlying industry or mar-ket sector of an organization’s offering.

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f Goals or objectives

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are state-ments of an accomplishment of a task to be achieved, often by a specific time. Goalsconvert an organization’s mission and business into long- and short-term performancetargets. several types of goals (profit, sales, market share, quality, costumer satisfaction)

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Market share

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the ratio of sales revenue of the firm to the totalsales revenue of all firms in the industry, including the firm itself

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marketing plan

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road map for the marketing actions of an organization for a specified future time period, such as one year or five years.

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What is the meaning of an organization’s mission?

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a statement of the organization’s function in society that often identifies its customers, markets, products, and technologies. (have a clear mission statement)

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What is the difference between an organization’s business and its goals?

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busniess - describes the clear, broad, underlying industry or mar- ket sector of an organization’s offering.

goals- are statements of an accomplishment of a task to be achieved, often by a specific time.

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marketing dashboard

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pdfbooksinfo.blogspot.com Marketing.pdf is the visual computer display of the essential information related to achieving a mar-keting objective.24

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marketing metric

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which is a measure of the quantitative pdfbooksinfo.blogspot.com Marketing.pdf value or trend of a marketing action or result.

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to see what they do best, organizations must look at its core _____

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competencies, which areits special capabilities—the skills, technologies, andresources—that distinguish it from other organizationsand provide customer value. Exploiting these competen-cies can lead to success.

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competencies

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which are its special capabilities—the skills, technologies, and resources—that distinguish it from other organizations and provide customer value. Exploiting these competen- cies can lead to success.

** should be distinctive enough to provide a COMPETITIVE ADVANTAGE

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COMPETITIVE ADVANTAGE

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unique strength relative tocompetitors that provides superior returns, often based onquality, time, cost, or innovation

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what are two techniques that allow businesses

to asses where they want to go?

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1. business portfolio analysis

2. diversification analysis

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business portfolio analysis

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technique that managers use to quantify performance measures and growth targets to analyze their firms’ strategic business units (SBUs) asthough they were a collection of separate investments. The purpose of this tool is todetermine which SBU or offering generates cash and which one requires cash to fundthe organization’s growth opportunities. 35

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Diversification analysis

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technique that helps afirm search for growth opportunities from among current and new markets as well ascurrent and new products. there are 4 market product strategies

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Market penetration

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a marketing strategy to increase sales of current productsin current markets, such as selling more Ben & Jerry’s Bonnaroo Buzz Fair

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4 market product strategies

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1. market penetration - a marketing strategy to increase sales of current products in current market

2. Market development is a marketing strategy to sell current products to new markets (start to sell Ben J in brazil)

3. Product development is a marketing strategy of selling new products to currentmarket (BJs selling children clothing)

4. Diversification- marketing stratgey of developing new products and sellingthem in new markets (trying to sell Ben and jerry clothes in brazil)

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market devleopment

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s a marketing strategy to sell current products to new markets (start to sell Ben J in brazil)

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product development

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a marketing strategy of selling new products to current market (BJs selling children clothing)

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diversification

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marketing stratgey of developing new products and selling them in new markets (trying to sell Ben and jerry clothes in brazil)

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strategic marketing process

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an organization allocates its marketing mix resources to reach its target mar-kets. its divided into 3 phases:

1. planning

2. implementation

3. evaluation

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3 steps of the planning phase of the marketing process

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1. situation- SWOT analysis - identify actions to allow firm to grow

2. market product focus and goal analysis -- determine which products will be directed towards which costumers

3. marketing program - devloping programs marketing mix (4 Ps) and budget

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situation and SWOT analysis

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situation analysis istaking stock of where the firm or product has been recently, where it is now, and whereit is headed in terms of the organization’s marketing plans and the external forces andtrends affecting it. An effective summary of a situation analysis is a SWOT analysis,an acronym describing an organization’s appraisal of its internal Strengths and Weak-nesses and its external Opportunities and Threats.

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SWOT analysis

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Identify trends in the organization’s industry.● Analyze the organization’s competitors.● Assess the organization itself.● Research the organization’s present and prospective customers.

* goal -- identify actions to help firm grow

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SWOT

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Build on a strength. Find specific efficiencies in distribution with parent-company Unilever’s existing ice cream brands.

● Correct a weakness. Recruit experienced managers from other consumer productfirms to help stimulate growth.

● Exploit an opportunity. Develop new product lines of low-fat, low-carb frozenGreek-style yogurt flavors to respond to changes in consumer tastes.

● Avoid a disaster-laden threat. Focus on less risky international markets, such asBrazil and Argentina.

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step 2: (in the planning phase of the strategic marketing progress) Market-Product Focus and Goal Setting

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determining which products will be directed towards which costumers

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determining which products will be directed towards which costumers is based on ____

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market segmentation

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market segmentation

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involves aggregating groups of buyers into segments that f (1) have common needs and(2) will respond similarly to a marketing action. enables an organization tofocus specific marketing programs on its target market segments.

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goal setting

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involves specifying measurable marketing objectives to be achieved

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Points of difference

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are those characteristics of aproduct that make it superior to competitive substitutes.

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step 3: marketing program

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devloping programs marketing mix (4 Ps) and its budget

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step 3 marketing program example

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1. Product strategy. Offer a Champion brand heart pacemaker with only those fea-tures needed by Asian patients.

2. Price strategy. Manufacture the Champion to control costs so that it can bepriced below $1,000 (in U.S. dollars)—an affordable price for Asian markets.

3. Promotion strategy. Introduce the Champion at medical conventions across Asia to demonstrate its many beneficial features.

4. Place (distribution) strategy. Search out, utilize, and train reputable medical de- vice distributors across Asia to call on cardiologists and medical clinics.

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implementation Phase of the Strategic Marketing Process ( 4 components )

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involves carrying out the marketing plan that emergesfrom the planning phase. involves 4 components: (1) obtaining resources,

(2) designing the marketing organization,

(3) defining precise tasks, responsibilities, anddeadlines

(4) actually executing the marketing program designed in the planning phase

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marketing strategy

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the means by which amarketing goal is to be achieved, usually characterized by a specified target marketand a marketing program to reach it.

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marketing tactics

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hundreds of detailed decisions are oftenrequired to develop the actions that comprise a marketing program for an offering ( these day-to-day operational marketing actions foreach element of the marketing mix that contribute to the overall success of marketing strate-gies)

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EVALUTION PHASE step 3

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seeks to keep the marketingprogram moving in the direction set for it.

(1) compare the results of the marketing programwith the goals in the written plans to identify deviations and (2) act on these deviations—exploiting positive deviations and correcting negative ones.

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O 2-1 Describe three kinds of organizations and the threelevels of strategy in them.

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An organization is a legal entity that consists of people who sharea common mission. It develops offerings (goods, services, orideas) that create value for both the organization and its customersby satisfying their needs and wants. Today’s organizations are ofthree types: for-profit organizations, nonprofit organizations, andgovernment agencies. A for-profit organization serves its custom-ers to earn a profit so that it can survive. Profit is the money leftafter a for-profit organization subtracts its expenses from its totalrevenues and is the reward for the risk it undertakes in marketingits offerings. A nonprofit organization is a nongovernmental orga-nization that serves its customers but does not have profit as anorganizational goal. Instead, its goals may be operational effi-ciency or client satisfaction. A government agency is a federal,state, county, or city unit that provides a specific service to itsconstituents. Most large for-profit and nonprofit organizations aredivided into three levels of strategy: (a) the corporate level, wheretop management directs overall strategy for the entire organiza-tion; (b) the strategic business unit level, where managers set amore specific strategic direction for their businesses to exploitvalue-creating opportunities; and (c) the functional level, wheregroups of specialists actually create value for the organization.

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LO 2-2 Describe core values, mission, organizationalculture, business, and goals.

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Organizations exist to accomplish something for someone. Togive organizations direction and focus, they continuously assesstheir core values, mission, organizational culture, business, andgoals. Today’s organizations specify their foundation, set a di-rection, and formulate strategies—the “why,” “what,” and“how” factors, respectively. Core values are the organization’sfundamental, passionate, and enduring principles that guide itsconduct over time. The organization’s mission is a statement of its function in society, often identifying its customers, markets,products, and technologies. Organizational culture is a set ofvalues, ideas, attitudes, and norms of behavior that is learnedand shared among the members of an organization. To answerthe question, “What business are we in?” an organization de-fines its “business”—the clear, broad, underlying industry cat-egory or market sector of its offering. Finally, the organization’sgoals (or objectives) are statements of an accomplishment of atask to be achieved, often by a specific time.

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] LO 2-3 Explain why managers use marketing dashboardsand marketing metrics.

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Marketing managers use marketing dashboards to visually dis-play on a single computer screen the essential information re-quired to make a decision to take an action or further analyze aproblem. This information consists of key performance mea-sures of a product category, such as sales or market share, and isknown as a marketing metric, which is a measure of the quanti-tative value or trend of a marketing activity or result. Most or-ganizations tie their marketing metrics to the quantitativeobjectives established in their marketing plan, which is a roadmap for the marketing activities of an organization for

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LO 2-4 Discuss how an organization assesses where it isnow and where it seeks to be.

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Managers of an organization ask two key questions to set astrategic direction. The first question, “Where are we now?”requires an organization to (a) reevaluate its competencies toensure that its special capabilities still provide a competitiveadvantage; (b) assess its present and prospective customers toensure they have a satisfying customer experience—thecentral goal of marketing today; and (c) analyze its currentand potential competitors from a global perspective to deter-mine whether it needs to redefine its business. pdfbooksinfo.blogspot.com Marketing.pdf The second question, “Where do we want to go?,” requires anorganization to set a specific direction and allocate resources tomove it in that direction. Business portfolio and diversification anal-yses help an organization do this. Managers use business portfolioanalysis to assess the organization’s strategic business units (SBUs),product lines, or individual products as though they were a collec-tion of separate investments (cash cows, stars, question marks, anddogs) to determine the amount of cash each should receive. Diversi-fication analysis is a tool that helps managers use one or a combina-tion of four strategies to increase revenues: market penetration(selling more of an existing product to existing markets); marketdevelopment (selling an existing product to new markets); productdevelopment (selling a new product to existing markets); and diver-sification (selling new products to new markets).

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2-5 Explain the three steps of the planning phase of thestrategic marketing process.

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An organization uses the strategic marketing process to allocateits marketing mix resources to reach its target markets. Thisprocess is divided into three phases: planning, implementation,and evaluation. The planning phase consists of (a) a situation(SWOT) analysis, which involves taking stock of where thefirm or product has been recently, where it is now, and where itis headed and focuses on the organization’s internal factors(strengths and weaknesses) and the external forces and trendsaffecting it (opportunities and threats); (b) a market-product fo-cus through market segmentation (grouping buyers intosegments with common needs and similar responses to market-ing programs) and goal setting, which in part requires creatingpoints of difference (those characteristics of a product t pdfmake it superior to competitive substitutes); and (c) a marketingprogram that specifies the budget and actions (marketing strate-gies and tactics) for each marketing mix element.

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LO 2-6 Describe the four components of the implementationphase of the strategic marketing process.

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The implementation phase of the strategic marketing process car-ries out the marketing plan that emerges from the planning phase.It has four key components: (a) obtaining resources; (b) design-ing the marketing organization to perform product management,marketing research, sales, and advertising and promotion activi-ties; (c) developing schedules to identify the tasks that need to bedone, the time that is allocated to each one, the people responsi-ble for each task, and the deadlines for each task—often with anaction item list and Gantt chart; and (d) executing the marketingstrategies, which are the means by which marketing goals are tobe achieved, and their associated marketing tactics, which are thedetailed day-to-day marketing actions for each element of themarketing mix that contribute to the overall success of a firm’smarketing strategies. These are the marketing program actions afirm takes to achieve the goals set forth in its marketing plan.

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Discuss how managers identify and act on deviationsfrom plans.

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The evaluation phase of the strategic marketing process seeks tokeep the marketing program moving in the direction that wasestablished in the marketing plan. This requires the marketingmanager to compare the results from the marketing programwith the marketing plan’s goals to (a) identify deviations or“planning gaps” and (b) take corrective actions to exploit posi-tive deviations or correct negative ones.