© 2012 Pearson Education, Inc. publishing Prentice Hall. Note 25 SWOT Analysis

© 2012 Pearson Education, Inc. publishing Prentice Hall. Figure Note SWOT Analysis Identifying Strengths and Weaknesses 2

© 2012 Pearson Education, Inc. publishing Prentice Hall. Customer Assessment  External forces represent opportunities or threats because of the changes they produce in the way customers meet or can possibly meet a need  Considering and continuously reconsidering customer assessment and segmentation is essential to identifying opportunities and threats 3

© 2012 Pearson Education, Inc. publishing Prentice Hall. Segment Changes  Market segments are never static  Segments grow, shrink, and change their buying habits, preferences, and buying criterion  Segments can split into subsegments or can merge or combine into a single, larger segments 4

© 2012 Pearson Education, Inc. publishing Prentice Hall. Environmental Scanning  Wherever an opportunity or threat arises, monitoring the environment is essential to feed understandings of changes, trends, and events to SWOT analyses 5

© 2012 Pearson Education, Inc. publishing Prentice Hall. Figure Note Strategic Implications of SWOT Analysis 6

© 2012 Pearson Education, Inc. publishing Prentice Hall. Conducting a SWOT Analysis  Assess the firm’s competitive advantages  Study the environment for opportunities and threats  Identify strategic alternatives and imperatives from the “fit” or match between the strengths and weaknesses and the opportunities and threats  Prioritize, plan, and act 7

© 2012 Pearson Education, Inc. publishing Prentice Hall. Figure Note Strengths and Weaknesses, Opportunities and Threats Drive Strategies 8

© 2012 Pearson Education, Inc. publishing Prentice Hall. Note 26 Targeting & Positioning

© 2012 Pearson Education, Inc. publishing Prentice Hall. Introduction  After a company has segmented its markets and has developed detailed segment profiles, two important decisions have to be made:  Should the company adopt a differentiated or undifferentiated marketing approach?  If it adopts a differentiated marketing approach, which segments should be targeted? 10

© 2012 Pearson Education, Inc. publishing Prentice Hall. Undifferentiated Versus Differentiated Marketing Approaches  Undifferentiated marketing  Ignores segment differences and applies a “one-size-fits- all” approach  This leads to benefits from economies of scale in research and development, production, advertising, distribution, and other overhead expenditures  Simplifies organizational structures 11

© 2012 Pearson Education, Inc. publishing Prentice Hall. Undifferentiated Versus Differentiated Marketing Approaches  Differentiated marketing  A company develops adapted or customized marketing mixes for different target market segments  It can better meet the segment-specific needs and requirements  Creates superior value and demand price premiums 12

© 2012 Pearson Education, Inc. publishing Prentice Hall. Undifferentiated Versus Differentiated Marketing Approaches  The downside of differentiated programs  The higher complexity of the organization and of the product portfolio  The diluted benefits of scale  The higher per-unit costs  Differentiated marketing can consist of:  Selected specialization  Segment specialization  Product specialization  Full market coverage 13

© 2012 Pearson Education, Inc. publishing Prentice Hall. Figure Note Differentiated Marketing Approaches 14

© 2012 Pearson Education, Inc. publishing Prentice Hall. Target Market Selection 15 Criteria for segment attractiveness are defined, they are weighted and evaluated Analyze whether a company has competitive advantages in the individual segments The weighted scores of segment attractiveness and competitive advantages are used to position each segment in a portfolio

© 2012 Pearson Education, Inc. publishing Prentice Hall. Target Market Selection  Additional criteria can be used:  Synergies  Core competences  Strategic objectives 16

© 2012 Pearson Education, Inc. publishing Prentice Hall. Positioning  Positioning requires a thorough understanding of:  The needs of the target market  Competitor’s positions in the target market  The firm’s own competitive advantages and points of differentiation 17

© 2012 Pearson Education, Inc. publishing Prentice Hall. Specific Tools for Positioning 18 Semantic scales Customer value maps Perceptual maps Positioning statements Relevant Distinctive Believable Feasible Communicable Sustainable

© 2012 Pearson Education, Inc. publishing Prentice Hall. Marketing concept  Marketing concept - firms will be most successful at achieving goals when they orient around the consumers’ needs and align the entire organization around satisfying those needs  Market orientation - a firm wide customer and competitor focus and coordination of activities 19

© 2012 Pearson Education, Inc. publishing Prentice Hall. Table Note Needs, Motives, Wants, and Demand 20