Term
| The Immediate Environment |
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Definition
| Partners+Company+Competition-->all effect Consumers(Immediate Environment) |
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Term
| Macroenvironmental Factors |
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Definition
| Culture+Political/Legal+Economic+Demographics+Social Trends+Technology-->all effect consumers |
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Term
| Analyze the Market Environment |
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Definition
-$40 Billion diet industry
-increased consumption of health and diet products
-businesses responding to the demand in a variety of ways
ex)"low carb" trend, healthier fast food options, 24/7 gyms, shape up shoes, shake weight |
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Term
| Three Phases of a Strategic Marketing Plan |
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Definition
1). Mission 2). Environmental Analysis(e.g. SWOT) 3). Segmentation, Targeting, Positioning
-poorly executed plan=failure
ex) disposable diapers made diff. for males/females didnt catch on-->remade with unisex=success |
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Term
| Step One: Defining the Mission and/or Vision |
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Definition
2 questions answered:
1) In which industries/business should be operate?
2) What is our sustainable competitive advantage?
MADD mission statement: The mission of MAD is to stop drunk driving, support the victims of this violent crime and prevent underage drinking |
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Term
| Porter's Five Forces Model |
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Definition
| Michael Porter's analysis on if an industry is profitable |
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Term
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Definition
Intensity of Current Competitors
-low intensity=higher profitability
-Industry has low intensity when few firms are competing
Ex) commercial aircraft--profitable, industry with low # of competitors: OIL, wrist watch industry-->a lot of companies=not very profitable |
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Term
| Availability of Substitutes |
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Definition
Customers can choose different product as a substitute
-Few or No substitutes=higher profitability
-Examples of few/no substitutes: gas, propriety drugs, electricity
-Examples of many substitutes: fresh vegetables, technological products(from past or future technologies), substitute for beer--hard liquor, wine |
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Term
| Threat of Potential Entrants |
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Definition
High Barriers to Entry=HIgher Profitability
High Barriers to Entry exist when
-high capital requirements
-economies of scale are present
-high product differentiation(ex: wristwatch industry)
-network externalities (technological or learning curve)--ex)software, lemonade stand, internet companies that sell things, ebay
Example of Barriers: Automobile Industries
Example of network barrier: Word Processing Software
-if I enter an industry where there is no barrier to entry, if I think it is profitable, then others will see it too |
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Term
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Definition
Lower Bargaining Power of Suppliers/Buyer=Higher Profitability
-Lower Bargaining Power when...high number, low information
-Low supplier power example--computer industry(hard disk drives)
-Low buyer power example--medical services (patients)
-# of employees goes down, hurts profitability
-availability can lower price (cars) |
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Term
Boston Consulting Group growth-share matrix
**look in book** |
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Definition
*Star: high growth rate industry—4g phones
-assuming that the iphone 4g is market leader, it would be a ‘star” because it’s a market share leader in a high growth industry
*Question Mark: HTC Sprint Phone
-invest in question marks
*Dog: laundry detergent—low growth
-if you have a low market share product in low growth industry(dog)
-dogs can still make $
*Cash Cow: coca cola
-use cash from your cow to invest in question marks
-ex)disani—take money from vitamin water and invest in Bacardi or something to make it a star |
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Term
| What is Sustainable Competitive Advantage? |
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Definition
an advantage versus competition that can be maintained consistently over time
Ex) McDonalds—sustainable comp adv: cheap price and good quality, good distribution, recognizable, customer loyalty
-They say: service. (not their food, operational efficiencies, not global expansion) |
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