Strategic Marketing – Lesson 15

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Western Governors University *

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Feb 20, 2024

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KEY WORDS & DEFINTIONS Module 4 Unit 3: Strategic Marketing – Lesson 15  5% of questions on OA - to influence the overall growth of the business. They assess where and how a business can grow, what customers are most likely to buy their products, and how to communicate to those customers to help them reach a purchase decision. - Companies pursue growth strategies to increase market share and profitability. - Growth strategies can focus on new or existing products for new or existing markets. Growth Strategy:  characteristics of four growth strategies corporations can pursue to grow sales and profitability. This unit teaches four growth strategies corporations can pursue to grow sales and profitability. What is a Strategic Opportunity Matrix? (Lesson 15, Page 34)  Framework that maps the four growth strategies (market penetration, market development, product development, and diversification) to a grid based on whether they address new or existing products and markets  organizes growth strategies in a framework. It helps companies focus on different growth strategies for markets and products by examining the following: What are the two areas a company examines while focusing on growth strategies? (Lesson 15, Page 34)  New versus existing markets  New versus existing products

Ansoff opportunity Matrix or Strategic-opportunity matrix has four possible growth combination based on markets and products. What are the combinations? (Lesson 16, Page 35) 1. Market penetration: This growth strategy uses current products and current markets with the goal to increase market share. 2. Market development: This growth strategy uses existing products to capture new markets. 3. Product development: This growth strategy uses new products in the existing market. 4. Diversification: This strategy creates new opportunities for the company by creating new products and markets. To make this decision, a company needs to understand how product strength, existing customer base, appetite for risk, and capability for expansion factor into each growth strategy. Identify the characteristics of each of the growth strategies. (Lesson 16, Page 35) 1. Market penetration uses current products and current markets with the goal of increasing market share. This strategy has lower risk than some others but requires gaining customers of your competitors or convincing existing customers to use more of your product. 2. Market development uses existing products to capture new markets. This may be a good strategy if you believe in the strength of your product and its ability to attract new customer segments. Targets new customers and new segments to expand sales base 3. New product development relies on identifying a strong need for a new product among existing customers. 4. Diversification seeks to increase sales through expanding into new products and new markets. It can involve higher risk and may require new or additional resources to execute. Identify the growth strategies- (Lesson 17, Page 36) A company uses pricing, promotion, and distribution strategies to grow their market share. Market Penetration - infiltrates a market in which current products already exist. Chik-fil-A sells its signature Chik-fil-A sauce in grocery stores. Market Penetration - infiltrates a market in which current products already exist. Disneyland is now positioning their theme parks to retired couples also. Market development targets new markets to expand and grow existing products. New users can be defined as new geographic, demographic, institutional, or psychographic segments. Apple introduced iPhone 14 which is new, improved, faster version of the previous generations of iPhones. Market Penetration Amazon was created with the intention of being a book selling website, but then Amazon used its success as a book seller and went into selling electronic, movies, medicines etc. Diversification

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