Key Terms
Strategy
Directed course of action to achieve intended goals. Tactics: specific means by which a strategy is carried out.
Think of it this way
Strategy is the plan; tactics are the steps you take to execute it.
Note
Percentages exceed 100% because most failures have multiple causes.
Budget decisions should start with the question
What are we trying to accomplish? Not: what are competitors spending?
Formula
Marketing ROI = Revenue Generated / Marketing Cost Invested
Example
$100,000 in sales from a $10,000 campaign = ROI of 10.
Two variables
1. Current market share 2.
Market share
Percentage of total market sales held by one product or company.
Market penetration
Grow share in markets you already serve with products you already have. Lowest risk because everything is known.
Product development
Create new products for existing customers. You know the market; the risk is in the new product.
Market development
Take existing products into new markets. You know the product; the risk is in the new market.
Diversification
New product, new market; highest risk. Marketing ROI: revenue generated divided by cost invested.
Customer relationship management (CRM)
A discipline combining database and computer technology with customer service and marketing communications; seeks to cre
Customer data includes
Demographics, industry, buying history, and preferences.
Buyer persona
A fictional, generalized representation of an ideal customer; helps marketers understand current and potential customers