Strategic planning is
a process of developing & maintaining a fit between a company’s resources (strengths), a company’s objectives and opportunities in the environment
What is an example of strategic planning with Lululemon?
1) Luluemon’s advantage: its innovated technology for its fabric
2) Objectives: to increase profits and sales in the athletic high end market
3) Opportunities: growing demand for workout clothes/ equipment
What does the strategic plan relate to?
The PMEG ( Product Market Expansion Grid)
Product Market Expansion Grid (PMEG) is
a portfolio planning tool for identifying company growth opportunities through market penetration, market development, diversification, and product development.
Steps in Strategic Planning
1) Defining the company mission
2) Setting company objectives & goals (profits, sales, market share, ROI)
3) Designing the business portfolio (BCG/ PMEG/ SBU’s)
4) Planning marketing & other functional strategies (partnerships)
Mission statement is
a statement of the organization’s purpose- what it wants to accomplish in the larger environment
Business Portfolio is
the collection of businesses and products that make up the company (best fit of weaknesses and strengths)
Portfolio Analysis is
the process by which management evaluates the products and businesses making up the company
Strategic Business Unit (SBU) is
a unit of the company that has a separate mission and objectives and that can be planned independently from other businesses. An SBU can be a company, division, a product line within a division, or a single product/brand. Also known as stars, cows, question marks, and dogs.
Growth share matrix (BCG) is
a portfolio planning method that evaluates a company’s strategic business units in terms of their market growth rate and relative market share. SBU’s are classified as stars, cows, question marks, and dogs.
What are the 4 strategies for the BCG matrix?
1) Build- invest more money into market support (Stars and question marks)
2) Hold- keep investment levels the same
3) Harvest- slow cut back on marketing support
4) Divest- Get ride of it (sell off to another country/stop production) (dogs)
Market penetration is
create more sales/market shares with the SAME product & market
EX: Lululemon: updated their website which has new features( improvement on checkout process, target recommendations, and ability to access site on all web devices.)
Market development is
create more sales by taking on existing products and finding new markets.
EX: Lululemon: began with only a few store in Vancouver. Now they are building in Europe, Asia and recently Dubai.
Product development is
creating new products in existing markets.
EX: Lululemon is constantly creating new products such as the “Naked” yoga pants.
creating new products in new markets.
EX: Lululemon expanding to men and having an Instagram for men “Lululemon”. Lululemon’s sales have increased from this.
reducing business portfolio by eliminating products that aren’t profitable
differentiating the market offering to create superior value
Marketing mix is
set of controllable tactical marketing tools- Place, Price, Product, Promote- that the firm blends to produce the response it wants in the target market.
SWOT analysis is
S- Strengths (internal capabilities) (positive)
W- Weaknesses (internal weaknesses) (negative)
O- Opportunities (external factors) (positve)
T- Threats (current & emerging external forces that challenge the company’s performance) (negative)
Market implementation is
turns marketing strategies into actions in order to accomplish strategic marketing objectives
Marketing control is
the process of evaluating the results of marketing strategies & plans and taking corrective action to ensure that objects are achieved.
Marketing audit is
examination of company’s environment, strategies and activities to determine problem areas and recommend a plan of action to improve a company’s marketing performance.
Value chain is
the series of department that carry out value- creating activities to design, product, market, deliver and support a firm’s products.
Value delivery network is
made up of the company, suppliers, distributors, and customers who “partner” with each other to improve the performance of the entire system.
Marketing strategy is
the marketing logic by which the business unit hopes to create customer value and achieve profitable customer relationships
Market segmentation is
dividing a market into distinct groups of buyers who have distinct needs, characteristics, or behavior and who might require separate products and marketing programs
Market segment is
a group of consumers who respond in a similar way to a given set of marketing efforts
Market targeting is
the process of evaluating each market segment’s attractiveness and selecting one or more segments to enter
arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers