- SBU (Strategic Business Unit): a subsidiary, division, or unit of an organization that markets a set of related offerings to a clearly defined target market. - Each SBU has a functional level. Departments are things like marketing and finance which are specialized functions. - SBUs o o o o - Question Marks Low shares/High growth. Require large injections of cash to maintain their market share, much less increase it. Stars High shares/High growth. Need extra cash to finance their own rapid future growth. When their growth slows, they likely become cash cows. Cash Cows High shares/Slow growth. Generate large amounts of cash, far more than they can use. Have dominant shares of slow-growth markets and provide cash to cover the organization's overhead and invest in other SBUs. Dogs Low shares/Slow growth. Generate enough cash to sustain themselves, they usually are not real winners of the organization. Dropping SBUs that are dogs is required sometimes because they consume more cash than they generate especially when they have competitive or strategic alliances with other SBUs. Good marketing strategy is a mix of what customers value and what your good at SWOT - Strength Weakness Opportunities Threats The 5 C’s - - - - Customers o Self-actualization o Esteem o Love/Belonging o Safety o Physiological Company – SW of the SWOT Analysis o What does this company do? o How does it make money? o What’s our strategy for competing? Collaborators/Complementers o Key Collaborators Retail Partners Suppliers o Complementers Enjoy success when you are successful Context o Competitive, Regulatory, Economic, Social, Technological (CREST) Competitors o Are there companies that provide alternative solutions to my customers needs? o How seriously should I take these competitors? Attractiveness of a Market/Industry? - Porter’s 5 Forces • Competitors • Potential Entrants • Substitutes • Buyer Strength • Supplier Strength • Which of these factors Increases the attractiveness of an industry? (e.g., fewer competitors = more attractive) • There’s no “Utopian Industry.” Which tradeoffs are you willing to accept?