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    Market Management Concepts

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    MARKET MANAGEMENT CONCEPTS
    Marketing is a general term used to
    describe all the steps that lead to final
    sales. It is the process of planning and
    executing pricing, promotion and
    distribution to satisfy individual and
    organizational needs.
    From this definition it is easy to see
    that marketing is more than just the
    process of selling a product or service.
    Marketing is an essential part of
    business, and without marketing, even
    the best products and services fail.
    Companies constantly fail because
    they do not know what is happening in
    the marketplace and as a result, they are
    not fully meeting their customer's
    needs. They mistakenly believe that
    with the proper amount of advertising,
    customers will buy whatever they
    are offered.
    Marketing consists of making
    decisions on the four P's:
    ? Product
    ? Place/Distribution
    ? Promotion
    ? Pricing
    Before a business owner can make
    decisions on the four P's, he/she must
    devise a plan. A plan provides a
    business with guidance on making
    decisions. This chapter includes
    directions on how to devise a plan that
    will assist in making decisions about
    the four P's. This type of plan is a sixstage
    process that is commonly referred
    to as strategic marketing; a strategic
    marketing plan is an important part of a
    business plan.
    Stage 1:
    The Mission Statement
    The first stage in strategic marketing
    is the development of a mission
    statement. A mission statement is a
    brief description of a company,
    generally no more that a few lines, that
    describes where the company is and
    where it wants to go.
    A good mission statement
    should contain:
    ? target customers/markets
    ? principal products/services
    ? core technologies used
    ? commitment to survival, growth
    and profitability
    ? key parts of the company's
    philosophy
    ? company self-concept
    ? company's desired images
    Do not expect a mission statement to
    be developed quickly. It generally takes
    various revisions before a complete
    mission statement is written.
    Stage 2: Overall
    Company Objectives
    Once a mission statement has been
    created, the company can develop
    objectives. Objectives are specific goals
    to be achieved by the business. They
    are plans that will help a company
    move toward the mission statement. A
    business normally creates both one- and
    three-year objectives. Examples of
    company objectives are:
    ? To earn at least 20% after-tax rate
    of return on our net investment
    during this year
    ? To make our cookies the best
    selling cookies in terms of units
    sold in Kansas
    Types of Objectives
    1. Profitability
    ? Net profit as a percent of sales
    ? Net profit as percent of
    total investment
    ? Net profit per share of
    common stock
    2. Volume
    ? Market share
    ? Percentage growth in sales
    ? Sales rank in the market
    ? Production capacity utilization
    3. Stability
    ? Variance in annual sales volume
    ? Variance in seasonal sales volume
    ? Variance in profitability
    4. Nonfinancial
    ? Maintenance of family control
    ? Improved corporate image
    ? Enhancement of technology or
    quality of life
    following basic criteria:
    Suitable: Do they fit with the corpor-
    ate mission?
    Measurable: What will happen
    and when?
    Feasible: Are they possible to
    achieve?
    Acceptable: Do they fit with the values
    of the company and the
    employees?
    Flexible: Can they be adapted and
    changed should unforeseen
    events arise?
    Motivating: Are they neither too
    difficult nor too easy to achieve?
    Understanding: Are they stated
    simply?
    Commitment: Are people committed
    to doing what is necessary to
    achieve them?
    Participation: Are the people
    responsible for achieving the
    objectives included in the
    objective-setting process?
    Companies need to ensure that ...

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