Author Question: Which of the following is recommended regarding the communications budget? A) The budget should be ... (Read 60 times)

frankwu · **on:** Jun 28, 2018

Which of the following is recommended regarding the communications budget?
A) The budget should be set based on what is left over after the firm pays for operating expenses and planned profits.
B) The budget should be set based on a percentage of the previous year's sales.
C) The budget should be set based on promotional spending behavior demonstrated by the competition.
D) The firm's communication objectives should drive the budget.
E) The budget should be increased by a fixed percent every year.

Question 2

Discuss the role of the strategy canvas and the four actions framework in establishing a strategic focus for the firm's marketing strategy. Why are these approaches invaluable in today's highly competitive environment?

akpaschal · **Reply #1 on:** Jun 28, 2018

Answer to Question 1

D

Answer to Question 2

Establishing a solid strategic focus is important because it lays the groundwork for the development of marketing goals and objectives. Unfortunately, many firms struggle with finding a focus that translates into a strategy that offers customers a compelling reason for purchasing the firm's products. In their book Blue Ocean Strategy, W. Chan Kim and Renee Mauborgne outlined two tools that can be used to help develop a strategic focus: the strategy canvas and the four actions framework.

In essence, a strategy canvas is a tool for visualizing a firm's strategy relative to other firms in a given industry. The horizontal axis of a strategy canvas identifies the key factors that the industry competes on with the products that are offered to customers. The vertical axis indicates the offering level that firms offer to buyers across these factors. The central portion of the strategy canvas is the value curve, or the graphic representation of the firm's relative performance across its industry's factors. The key to using the strategy canvas (and the key to developing a compelling strategic focus) lies in identifying a value curve that stands apart from the competition. To use the strategy canvas successfully, the marketing manager must identify a value curve with two major characteristics. First, the value curve should clearly depict the firm's strategic focus. Second, the value curve should be distinctively different from competitors.

The four actions framework is a tool for discovering how to shift the strategy canvas and reorient the firm's strategic focus. The four-actions framework is designed to challenge traditional assumptions about strategy by asking four questions about the firm's way of doing business.

- Eliminate-Which of the factors that the industry takes for granted should be eliminated?

- Reduce-Which factors should be reduced well below the industry's standard?
- Create-Which factors should be created that the industry has never offered?
- Raise-Which factors should be raised well above the industry's standard?

These approaches are invaluable for two reasons. First, both tools require the firm to give up long-held assumptions about how business should be conducted. Instead, the approach requires firms to fundamentally alter their strategic logic. Second, both tools argue against the traditional approaches of benchmarking and extensive customer research. These traditional approaches tend to create a typical more for less mentality that guides the strategic focus of most firms.