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 ...