PORTER’S VALUE CHAIN

Core competencies
• A source of competitive advantage and makes
a significant contribution to perceived
customer benefits
• Applications in a wide variety of markets
• Difficult for competitors to imitate
• Competitive advantage also accompanies
distinctive capabilities or excellence in
broader business processes.
 CORE COMPETENCY EXAMPLES
• Innovation expertise
• Superior product development skills
• Strong analysis and database skills
• Industry/market knowledge and expertise
• Experts in marketing communications
• Fast or friendly customer service
• Streamlined and efficient processes
• Logistics expertise
 Central role of strategic planning
• Managing the businesses as an investment
portfolio

• Assessing the market’s growth rate and the

company’s position in that market

• Establishing a strategy
 The Marketing Environment
• The marketing environment includes the
actors and forces outside marketing that
affect marketing management’s ability to
build and maintain successful relationships
with customers.
• Micro Environment
• Macro Environment
 The Marketing Environment
• The microenvironment/internal environment
consists of the actors close to the company that
affect its ability to serve its customers:
• The company
• Suppliers
• Marketing intermediaries
• Customers
• Competitors
• Publics
The Company’s Microenvironment
 The Company
Internal environment includes:
• Top management
• Finance
• R&D
• Purchasing
• Operations
• Accounting
 Suppliers
• Provide the resources to produce goods and
services
• Treated as partners to provide customer
value
 Marketing Intermediaries
• Help the company to promote, sell, and
distribute its products to final buyers
• Include:
• Resellers
• Physical distribution firms
• Marketing services agencies
• Financial intermediaries
 Marketing Intermediaries
• Resellers are the distribution channel firms
that help the company find customers or make
sales to them. These include:
• Wholesalers
• Retailers
• Physical distribution firms are the distribution
channel firms that help the company to stock
and move goods from their points of origin to
their final destination.
 Marketing Intermediaries
• Marketing service agencies are the:
• marketing research firms
• advertising agencies
• media firms and
• marketing consulting firms that help the
company target and promote its products to
the right markets.
 Marketing Intermediaries
• Financial intermediaries include:
• banks
• credit companies
• insurance companies, and
• other businesses that help finance
transactions or insure against the risks
associated with the buying and selling of
goods.
 Customers
• Customer markets consist of individuals and
households that buy goods and services for
personal consumption.
• Business markets buy goods and services for
further processing or for use in their production
process.
• Reseller markets buy goods and services to
resell at a profit.
• Government markets buy goods and services to
produce public services or transfer goods and
services to others who need them.
• International markets consist of buyers in other
countries including consumers, producers,
resellers, and governments.
 Competitors
• Firms must gain strategic advantage by
positioning their offerings against
competitors’ offerings.
• Each firm should consider its own size and
industry position compared to those of its
competitors.
 Publics
• Any group that has an actual or potential
interest in or impact on an organization’s
ability to achieve its objectives:
• Financial publics influence the company’s
ability to obtain funds—banks, investment
houses, and stockholders.
• Media publics carry news, features, and
editorial opinion—newspapers, magazines,
and radio and television stations.
• Government publics influence product safety
and truth in advertising.
 Publics
• Citizen-action publics include consumer
organizations, environment groups, and
minority groups
• Local publics include neighborhood residents
and community organizations
• General publics influence the company’s
public image
• Internal publics include workers, managers,
volunteers, and directors