Professional Documents
Culture Documents
Analysis
A firms macro
Environment
Technological
The technological environment includes factors and trends related to
innovations that affect the development of new products or the marketing
process.
These technological trends can provide opportunities for new product
development, affect how marketing activities are performed, or both.
Socio-Cultural
The social environment includes all factors and trends related to groups of
people, including their number, characteristics, behavior, and growth
projections.
Politico-Legal
In todays world economy, international political events greatly affect
marketing activities. For example the impact of the war on terrorism on the
travel and security industries.
Economic Demographic
The economic environment includes factors and trends related to income
levels and the production of goods and services.
Analytical Tools
Mapping Company Strengths /
Weakness with Environment
Characteristics
Porter's Five Forces
BCG Matrix
GE Matrix
Ansoff Matrix
SWOT Analysis
Michael Porter
An industrys profit
potential is largely
determined by the
intensity of competitive
rivalry within that
industry.
Portfolio Analysis
Strategy at the time
(1970s) was focused on two
dimensions of the portfolio
grids
Industry Attractiveness
Competitive Position
Where was
Michael Porter
coming from?
School of Economics
at Harvard
Structural reasons
why
Structural reasons
all represented barriers
to entry in certain
industries, thus allowing
those industries to be
more profitable than
others.
Barriers to Entry
large capital requirements or
the need to gain economies
of scale quickly.
strong customer loyalty or
strong brand preferences.
lack of adequate distribution
channels or access to raw
materials.
Power of Suppliers
high when
* A small number of dominant,
highly concentrated suppliers
exists.
* Few good substitute raw
materials or suppliers are
available.
* The cost of switching raw
materials or suppliers is high.
Power of Buyers
high when
* Customers are concentrated, large or
buy in volume .
* The products being purchased are
standard or undifferentiated making
it easy to switch to other suppliers.
* Customers purchases represent a
major portion of the sellers total
revenue.
Substitute products
competitive strength high
when
* The relative price of substitute
products declines .
* Consumers switching costs
decline.
* Competitors plan to increase
market penetration or
Rivalry among
competitors
intensity increases as
Summary
As rivalry among
competing firms
intensifies, industry
profits decline, in some
cases to the point
where an industry
becomes inherently
Ansoff Matrix
Growth Marketing Strategy
Most companies (ASDA, British Airways, IBM etc) want to grow
There are several alternative growth strategies proposed by Ansoff
Market Strategies on vertical axis
Market Penetration Strategy
Market Development Strategy
Ansoff Matrix
Current
Products
Current
Markets
New
Markets
New
Products
Market
Penetration
Strategy
Product
Development
Strategy
Market
Development
Strategy
Product
Diversification
Strategy
Ansoff Matrix
Market Penetration Strategy
Expanding sales from existing products in existing markets
Strategies: heavy promotions, PR, price discounts etc in Wrexham
Market Development Strategy
Entering new markets with existing products
Strategies: introductory offers, trial brochures, radio etc in Chester
Product Development Strategy
Launching new products in existing markets
Strategies: developing new products, additional features of existing products
Introductory promotion of new products etc in Wrexham
Product Diversification Strategy
Launching new products in new markets
Strategies: developing new products, additional features of existing products
Introductory promotion of new products etc in Chester
BCG Matrix
Stars
Cash Cows
Question Marks
Dogs
Market Attractiveness
Whightag
e
Rank(onascaleof1
to10)forMarket
A
Rank(onascaleof1
to10)forMarket
B
Coordinate
for
Market
A
Coordinate
for
Market
B
Growth
0.2
10
0.4
EntryBarriers
0.2
10
0.4
CompetitiveSkills
0.1
0.2
0.3
TechnologyOrientation
0.1
0.7
0.5
Size
0.2
10
0.2
Distance
0.15
10
0.6
1.5
LegalFramework
0.05
0.1
0.1
Total
5.8
5.2
SBU Strength
Whightag
e
Rank(onascaleof1
to10)forSBUA
Rank(onascaleof1
to10)forSBUB
Coordinate
for
SBUA
Coordinate
for
SBUB
FinancialStrengths
0.5
10
ManagerialSkills
0.3
10
0.6
TechnologyOrientation
0.1
0.2
0.3
BrandStregth
0.1
0.7
0.5
Total
8.9
2.4
GE Matrix
Invest
Invest
Analyze
Market Attractiveness
A
B
Invest
HOLD
MILK
Milk
Dives
t
Divest
SBU Strength