Page 71 - Marketing Management

48 PART 1 UNDERSTANDING MARKETING MANAGEMENT

External
environment
(opportunity &
threat analysis)
Feedback
Business Goal Strategy Program Implementation and
mission SWOT analysis formulation formulation formulation
control
Internal
environment
(strengths/
weaknesses analysis)

|Fig. 2.3|

The Business Unit The Business Mission
Strategic-Planning
Each business unit needs to define its specific mission within the broader company mission. Thus, a
Process television-studio-lighting-equipment company might define its mission as, “To target major televi-
sion studios and become their vendor of choice for lighting technologies that represent the most
advanced and reliable studio lighting arrangements.” Notice this mission does not attempt to win
business from smaller television studios, offer the lowest price, or venture into nonlighting products.

SWOT Analysis

The overall evaluation of a company’s strengths, weaknesses, opportunities, and threats is called
SWOT analysis. It’s a way of monitoring the external and internal marketing environment.

EXTERNAL ENVIRONMENT (OPPORTUNITY AND THREAT) ANALYSIS A busi-
ness unit must monitor key macroenvironment forces and significant microenvironment factors that
affect its ability to earn profits. It should set up a marketing intelligence system to track trends and
important developments and any related opportunities and threats.
Good marketing is the art of finding, developing, and profiting from these opportunities. 30
A marketing opportunity is an area of buyer need and interest that a company has a high probabil-
31
ity of profitably satisfying. There are three main sources of market opportunities. The first is to
offer something that is in short supply. This requires little marketing talent, as the need is fairly
obvious. The second is to supply an existing product or service in a new or superior way. How? The
problem detection method asks consumers for their suggestions, the ideal method has them imagine
an ideal version of the product or service, and the consumption chain method asks them to chart
their steps in acquiring, using, and disposing of a product. This last method often leads to a totally
new product or service.
Marketers need to be good at spotting opportunities. Consider the following:
• A company may benefit from converging industry trends and introduce hybrid products or
services that are new to the market. Major cell manufacturers have released phones with
digital photo and video capabilities, and Global Positioning Systems (GPS).
• A company may make a buying process more convenient or efficient. Consumers can use the
Internet to find more books than ever and search for the lowest price with a few clicks.
• A company can meet the need for more information and advice. Angie’s List connects individ-
uals with local home improvement contractors and doctors that have been reviewed by others.
• A company can customize a product or service. Timberland allows customers to choose colors
for different sections of their boots, add initials or numbers to their boots, and choose different
stitching and embroidery.
• A company can introduce a new capability. Consumers can create and edit digital “iMovies”
with the iMac and upload them to an Apple Web server or Web site such as YouTube to share
with friends around the world.
• A company may be able to deliver a product or service faster. FedEx discovered a way to
deliver mail and packages much more quickly than the U.S. Post Office.
• A company may be able to offer a product at a much lower price. Pharmaceutical firms have
created generic versions of brand-name drugs, and mail-order drug companies often sell for less.