Essential Marketing Functions and Business Strategy

Why is marketing such an important function in most organizations?

Marketing is a vital business function necessary in nearly all industries, whether the organization operates as a for-profit or as a not-for-profit entity. For the for-profit organization, marketing is responsible for most tasks that bring revenue and, hopefully, profits. For the not-for-profit organization, marketing is responsible for attracting supporters or customers.

Market Research in Management Decisions

What part can market research play in management decisions on product/service design?

Market research is the planned, systematic collection of data designed to help management take decisions about each operation and to monitor the results of those decisions to understand customer needs.

Defining Marketing Strategy

What is meant by marketing strategy? Produce an outline strategy for a company, institution, or club.

A marketing strategy is a process or model that allows a company or organization to focus limited resources on the best opportunities to increase sales and thereby achieve a sustainable competitive advantage.

This process ensures a company knows exactly what its limited resources are and how to leverage the best opportunities to increase sales and achieve a strong competitive advantage. A good example for controlling its target market is using the marketing mix (4 Ps): Product, Price, Place, and Promotion.

Competition and Product Portfolio

How important is competition as a factor in developing an organization's service/product portfolio? Example: Coca-Cola/Pepsi & Apple/Samsung.

The competitive forces on a company are very important when creating a portfolio because one must account for:

• Potential new entrants.
• Substitute products.
• The bargaining power of buyers.
• The bargaining power of suppliers.

As competition is pervasive, a company needs to strive to create a successful structure that is difficult for others to replicate. Successful companies integrate their activities in ways that are hard to copy.

Monitoring Organizational Strategy

How should an organization carry out the monitoring and review of each organizational strategy?

An organization should avoid changing its strategic direction too frequently. A change in firm strategy should only occur in extreme cases.

Applying Porter’s Five Forces

How can we use Porter’s five forces in order to analyze an industry?

These forces are used to exploit opportunities in the environment and to protect the organization against competition. The five Porter’s forces strategies involve analyzing:

1. Potential New Entrants: These face higher barriers in capital-intensive industries (like motor cars) than in service industries (like estate agencies).
2. Bargaining Power of Buyers: This power increases when buyers have access to more advertising and consumer information, meaning they know exactly what they are purchasing.
3. Bargaining Power of Suppliers: This depends on the availability of substitute suppliers.
4. Threat of Substitute Products: This threat is more powerful when viable alternatives exist for a company’s product.
5. Rivalry Among Competitors: This rivalry manifests through advertising, pricing, and product differentiation efforts.