Principles of Marketing and Strategic Management

Study Notes

Marketers should not just talk to consumers, but work with them throughout the marketing process.
Consumers should be given a reason to participate in online forums and engage with the brand.
Monitor blogs and social media platforms for customer feedback and insights.
Marketers should listen to and engage in online conversations about their company and industry.
Avoid controlling online conversations and allow them to flow freely.
Employ "marketing technologists" with expertise in marketing, technology, and social interaction.

Market Segmentation allows companies with limited resources to successfully compete by targeting specific customer groups.
EPS/EBIT analysis is a commonly used technique to assess whether debt, equity, or a combination of both is the best way to raise capital for strategy implementation.
Limitations of EPS/EBIT analysis include:
- Flexibility in capital structure
- Control issues due to debt financing
- Fluctuation in interest rates
- The impact of high leverage on debt financing
- Assumptions about stock price, tax rates, and interest rates remaining constant.
Structure Dictates How Resources will be Allocated
- Customer-based structure allocates resources by customer group.
- Functional structure allocates resources by business function.

Advantages:
- Simple and inexpensive
- Leverages specialized business activities
- Minimal need for elaborate control system
- Allows for rapid decision-making
Disadvantages:
- Accountability centralized at the top
- Limited delegation of authority and responsibility
- Weak career development opportunities
- Low employee and manager morale
- Inadequate planning for products and markets
- Promotes short-term, narrow thinking
- Leads to communication problems

Divisional by Geographic Area: Suitable for companies requiring strategies tailored to specific geographic needs and customer characteristics.
Divisional by Product or Service: Suitable for companies with various product lines or services, permitting each division to focus on specific offerings.
Divisional by Customer Type: Suitable for companies serving distinct customer groups, allowing each division to cater to specific customer needs.

The most complex organizational structure.
Combines both vertical and horizontal flows of authority and communication.
Results in higher overhead costs due to additional management positions.
Advantages:
- Clear project objectives
- Employees can see the outcomes of their work

Production Processes often comprise more than 70% of a firm's total assets and play a significant role in the strategy implementation process.

Reasons for increased strategy evaluation difficulty:
- Increasing complexity of the business environment
- Difficulty in accurately predicting the future
- Growth in the number of variables impacting businesses
- Rapid obsolescence of plans
- Surge in domestic and global events affecting organizations
- Shortened time horizons for reliable planning
- Consonance refers to the need for a strategy to align with and adapt to changing external and internal environments.
- Feasibility ensures that a strategy can be executed within the company's physical, human, and financial resources.