Strategic market management

by (European ed.)
ISBN-10 0470059869 ISBN-13 9780470059869
146 Flashcards & Notes
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Summary - Strategic market management

  • 1.1 What is a business strategy?

  • A business is generally an organizational unit that has a distinct business strategy and a manager with sales and profit responsibility.


    Four dimensions define a business strategy:


    1. The product market investment strategy; where to compete

    The scope of a business is defined by the product it offers, the market it serves, the competitors it competes with and by its level of vertical integration.

    The investment pattern will determine the future direction of the firm, conceptual choices:

    - invest to grow
    - invest only to maintain the existing position
    - milk the business by minimizing investment
    - recover as many assets as possible by liquidating or divesting the business


    2. The customer value proposition; how to compete

    CVP is the perceived functional, emotional, social, or self-expressive benefit that is provided by the organization’s offering. To support a successful strategy, the proposition should be sustainable over time and differentiate the offering from its competitors.

     

    3. Assets an competencies; how to compete
    The strategic assets or competencies that underlie the strategy provide the sustainable competitive advantage (SCA). A strategic competency is what a business unit does exceptionally well which has strategic importance to the business. A strategic asset is a resource which is strong relative to that of competitors.

    Strategic formulation must consider the cost and feasibility of generating or maintaining assets or competencies that will provide the basis for a SCA.


    4. Functional strategies and programmes; how to compete

    Functional strategies or programmes that could drive the business strategy include: manufacturing strategy, distribution strategy, brand-building strategy, communication strategy and so on. 

  • What is a business strategy?
    Long term business planning, typically a period of 3-5 years.
    Consist of where to compete?
    Geograpically Coca cola competes in the US, Mexico
    How to compete?
    Assets and competences,
    Value proposition
    Functional strategies
    Coca cola has a mass marketing strategy.
  • What is the product market investment strategy?

    Invest to grow,
    Invest to maintain position
    Milk the business by minimising investments
    Recover as many as assets as posible by liquidating the business
  • What is a customer value proposition?

    The total of benefits which a vendor promises a customer in return for the customers payment
  • Name three examples of a customer value proposition?

    1. A goof value- aldi
    2. Global presitge louis vuitton
    3.Product line breadth Gilette
  • What is a manufacturing strategy?

    Manufacturers must deal with global challenges such as increasing customer expectation and lower cost competitors
  • What is a distribution strategy?
    Making a product or service available to the consumer either directly or indirectly.
  • Name one example of an distribution strategy

    Making cocaine available tot the consumer from mexico(production)
  • What is a communication strategy?

    Designed to help you and your company communicate effectively and meet core organisational objectives.
  • What is a information technology strategy?

    Overall plan of objectives and principles relate to use of technology.
  • What is a global strategy?

    An organizations guide to globalization
  • Name one example of a global strategy

    Mc Donalds for example, anywhere mc donalds goes it ensures it offers products that will appeal to the locals the most, F.E. In India they only eat Vegetarian or chicken products.
  • What is a segmentation strategy?

    The process of dividing the market into subgroups of similar customers.
  • Name one example of an segmentation strategy

    Market--) Cars,
    Market segmentation: Families, Singles.
    Market segment Families-Flexible, safety, Singles- Young, style, more disposable income).
    Target market:Families or Singles.
  • What is the criteria to select a business strategy?

    1. Is the return on investment (ROI) attractive?
    2. Is the strategy feasible?
    3. Will the strategy fit with the other strategies of the firm?
    4.Is there a Sustainable compatible advantage?
  • What is the ROI?

    Return on investment
  • How do you calculate the ROI?

    ROI= Net profit/ Total investment*100%
  • If martha bought an Ipad voor 500 euro's and she sells it for 300 Euros what is then her ROI?

    ROI is Net profit/Total investment*100%
    500-300=200 is the net profit
    500= total investment
    200/500*100%=- 40
  • What is the SCA(sustainable competititve advantage?

    A company needs a competitive advantage to protect them from going bankrupt(recession), It prevents competitors to take the advantage of a company.
  • Name three examples of a SCA


    1. PAtent (to protect the brand
    2. Monopoly- Free to set their own prices
    3. Switching- Not handy, difficult (windows- apple)
  • What is an external analysis?

    1. Customer analysis
    2. Competitor analysis
    3.. Environmental analysis
    4. market analysis
    5. Environmental analysis
  • What is an Internal analyis?

    Performance analysis
    Determants of strategic options
  • What consist in a strategic analysis?

    Internal/external analysis
  • Name the strategic options

    Innovation
    Focus
    Global
    Quality
    Product quality
  • What are the trends in strategies?

    External market orientation
    Pro-active strategies
    Knowledge management

  • Why strategic management?

    Precipate(neerslaan) the consideration of strategic choices
    Force a long range view
    Help a business cope with change
    Provide both horizontal and vertical communication systems
  • What is a pro-active company?

    Forward thinking strategy planning
  • What is a reactive company?

    Deal with problems as they arise, approach opportunities as they arise
  • What are strategic uncertainties?

    What will be the sales profile of hybrids in the upcoming years?
    How many will be sold?
    What will be the direct competitors?
    What will be the future deman?
  • Name two strategic decisions?

    Investment in product management
    Investment in technology
  • What is a customer analysis?

    Who are the biggest customers?
    How could the market be segmented in groups?
    What are the customer motivations/objectives
    What are the customers unmet needs?
  • What is the 5 W model?

    Who, What, When, Where, WHy
  • How should segments be defined?

    -Price sensitivity
    -Loyalty
    -Applications
  • What are customer characteristics?

    Geographic
    Size
    Sex
    Age
  • What are product related approaches?

    Price sensitivity
    -Competitor
    -Brand loyalty
  • What is a customer motivation analysis?

    Indentify motivations
    2. Asses motivation
    3. Assign strategic roles to motivations

  •  What is the customer as an active partner?

    - Encourage active dialogue
    -Current, potential competitors
  • What is a competitor analyis?

    Identifying current/potential competitors
  • What are the two ways of identifying current competitors:

    The customer based approach
    In strategic groups
  • What is a strategic group?

    A group that has similar competitive strategies
    Have similar characteristics
    Have similar assets and competences
  • How do potential competitors emerge?

    Through
    Market expansion
    Product expansion
    Backward and forward integration

  • What is the checklist for a SWOT?

    manufacturing
    innovation
    Management
    Marketing
  • How can you obtain information on competitors?

    Company website
    Search engines on the internet
    Telephone survey
  • What makes a  competitor vulnerable?

    -Marketing factors-low market share
    -Financial factors: High cost
    - Product/market factors: slow/poor growth
    -Managerial factors, inflexibility, loosing touch with customers

  • What are the dimensions of a market analysis?

    -Emerging submarkets
    -Trends and development
    -Key succes factors
  • What are the porters 5 forces?

    Threat of new entrants
    Threat of substitute products
    Bargaining power of suppliers
    Bargaining power of customers
    Rivalry of competitors
  • E-Business and high profitability ? What is the key?

    The key is product differentiation,
    For example google to dominate the web search
  • What is it when we talk about the boiled frog?

    Dramatically changing environment
  • What are the three ways to react on a dramatically changing environment?

    To ignore what is happening
    To respond quickly or slowly but reactively
    To try to predict the nature of the changes and then manage them proactively.
  • What is the PESTLE/DESTEP?

    D-demographic-
    E-Economic
    S-Social cultural
    T-Techhnological
    E-Ecological
    P-Political
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Example questions in this summary

What is the product market investment strategy?
2
If martha bought an Ipad voor 500 euro's and she sells it for 300 Euros what is then her ROI?
2
What is a business strategy?
1
What is a customer value proposition?
1
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