CHAPTER 2 Strategic Planning and the Marketing Process Objective : Selecting the company strategy for long-run survival and explaining the marketing management process. Strategic Planning The overall company strategy for long-run survival and growth is called strategic planning.
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Strategic Planning and the Marketing Process
Objective: Selecting the company strategy for long-run survival and explaining the marketing management process.
MarketHigh Mark growthshareLow
Cash Cow Dog
The BCG growth-share matrixRelative market share
1. invest more in the business unit in order to build (increase) its share.
2. invest just enough to hold (keep) the SBU’s share at the current level.
3. it can harvest the SBU, milking its short-term cash flow regardless of the long-term effect .
4. divest (kill) the SBU by selling it or phasing it out and using the resources elsewhere.
Existing 1. Market 3. Product
markets penetration development
New 2. Market 4. Diversification
Product/Market expansion grid is used to identify growth opportunities for the company.
PEST analysis is an examination of the uncontrollable factors; Political (e.g. taxation, tourism policy), Economic (e.g. inflation, unemployment, fuel costs), Social (e.g. workforce change, lifestyle, values, education) and Technological (e.g. new systems like reservations, home technology) changes which may affect the company and the market.
The above information should be gathered on the basis of how it affects the company.
The company should try to eliminate the negative impacts of the threats and use the opportunities in the best way. But the development of opportunities involve risk, that is why, managers must decide whether the expected returns justify the risks or not.
The company should try to emphasize its strengths and correct weaknesses to use the opportunities.