I. Customers/Types a.

The ultimate customers are one that buys goods and services for their own personal use or for the household members b. The organizational customers are the one that buys goods and service for resale, inputs to the production of other goods and services and the use in day to day operations of the organization. II. Needs vs. Wants a. Needs- basic forces that drive customers to take action. Physical needs- food, water, shelter Social needs- security, belonging, love, esteem b. Wants- what gets exchanged Products- we buy things (tangible products) Services- the intangible products (cant touch them) III. Exchange create Values a. When we buy things, we buy the benefits not products. b. EX: Buying a traveling machine rather than a car or buy telling device rather than a watch. IV. The Four Cs a. Company Internal Resources- employees, financial , physical and technological b. Context (environment) social, culture, Economic, political and legal c. Customers-Meeting the needs, wants of current and potential customers d. Competitors- the relative strengths and weaknesses of competitors and trends in the competitive environment CHAPTER II I. Competitive Conditions a. Business activity or Function Product offering Product line Pricing Research Packaging Credit Promotion b. Product orientation Company sells what it can make, primary focus on functional performance and cost

 Narrow Based on production and distribution cost Tech research, focus on product improvement and cost cutting in production process Protection for the product, minimize costs A necessary evil minimize bad debt loses Emphasis on product features, quality, and price c. Market Orientation Company makes what it can sell. Focus on customers needs and market opportunities Broad Based on perceived benefits provided Market Research, focus on I.D new opportunities and application of new tech to satisfy customer needs Designed for customer convenience, promotional tool Customer service, tool to attract new customers Emphasis on product benefits and ability to satisfy customers needs or solve problems II. Components of Strategy a. Scope- number and types of industries, product lines and market segments it competes in or paln to enter. Diversification b. Goals and Objectives- what we want to achieve growth, profit contribution, or return on investment over specific time period c. Resource Support Deployments- the decision on how to utilize the limited financial and human resources in regards to d. Identification of Sustainable Competitive Advantage- how organization will compete in each business and product market within its domain. How to have an advantage over competitors. e. Synergy- when the firms businesses, product markets, resource deployments and competencies complement and reinforce one another. III. Levels of strategy a. Corporate Strategy Managers must coordinate the activities of multiple business units and in the case of conglomerates, even separate legal business entities. What business are we in, what business should we be in, and how to use total resources. b. Business Strategy

 How business unit competes within its industry is the critical focus of business level strategy. Sustainable competitive Advantage. How many and which markets segments to compete in. c. Marketing Strategy Strategy is to effectively allocate and coordinate Marketing resources and activities to accomplish the firms objectives within a specific product market. IV. Corporate Objectives a. Growth b. Competitive strength c. Innovativeness d. Profitability e. Utilization of Resources f. Contribution to owners g. Contribution to customers h. Contribution to employees i. Contribution to Society V. Allocating corporate strategy a. Question Mark- High Growth, low Market share Require large amounts of cash for expansion, and for marketing activities. b. Stars- High growth, high Market share Are net users of cash rather than suppliers c. Cash cow- low growth, High Market share Primary generators of cash and profits in corp. no additional capital investment, market stable. d. Dog- low growth, low Market share Generate low profits. VI. Corporate Growth Strategy a. Increasing Penetration of Current Products Lower costs, increase improvements, increase market share and Increase product usage b. Developing New products for current customers Intro of product line extensions, new product for existing customers. Arm and Hammer (laundry, oven cleaner, carpet cleaner) c. Selling Existing Products to New Segments Creation of MKT programs aimed at nonusers or occasional user for existing products. Geographical- new countries

d. Expansion through Diversification Forward vertical integration Backward Integration