REVISION CH2: MARKETING STRATEGY

MAJOR QUESTIONS AND SCENARIOS QUESTIONS:

1) Which of the following is NOT a market-oriented business definition?
A) "We empower customers to realize their dreams." B) "We make high-quality consumer food products."
C) "We sell success and status." D) "We create the Hilton experience."
E) "We bring innovation to every home."

2) Orion Inc. operates in many industries, including pharmaceuticals and food products. The company's goal is to create "abundant
and affordable food for all and a healthy environment." This represents Orion's ________.
A) marketing plan B) product mix C) business portfolio D) marketing mix E) mission statement

3) Which of the following companies has a market-oriented business definition?

A) An electronics company, whose business definition is: "We produce microchips."
B) A hotel, whose business definition is: "We rent rooms."
C) An apparel company, whose business definition is: "We make and sell women's clothing."
D) A cosmetic company, whose business definition is: "We sell hope and self-esteem."
E) A pizzeria, whose business definition is: "We sell the world's most delicious thin-crust pizzas."

4) Which of the following is NOT an example of product-oriented mission statements?

A) "We are an online library." B) "We run theme parks." C) "We sell athletic shoes."
D) "We sell memorable experiences." E) "We rent hotel rooms."

5) Which of the following is a market-oriented mission statement?

A) "We empower customers to achieve their dreams." B) "We sell jumbo burgers." C) "We are an online library."
D) "We are a low-cost airline." E) "We make porcelain figurines."

6) The pharmaceuticals division of Omni Healthcare holds low market share in a high-growth market. According to the BCG matrix,
the pharmaceuticals division of Omni can be classified as a ________.
A) star B) bear C) question mark D) cash cow E) dog

7) Phoenix, a popular coffee shop chain in North America, recently opened 400 stores to cater to its rapidly increasing number of
patrons. This exemplifies ________.
A) product differentiation B) product development C) diversification D) market penetration E) market segmentation

8) Lark Inc., an American electronics company, is currently reviewing new geographical markets to sell its highly popular televisions.
By 2020, it plans to open new stores across all the major South Asian cities. Lark is most likely following a ________ strategy.
A) local marketing B) market development C) diversification D) product adaptation E) product development

9) The managers of Arrow, an American retail chain, are currently reviewing new demographic markets to sell the firm's current
products. This is an example of ________.
A) market penetration B) product development C) mass marketing D) market development E) product adaptation

10) The managers of Alfredo's Pizza, a popular pizzeria in New York City, have been increasingly encouraging senior citizens to visit
the pizzeria's numerous outlets spread across the city. Anticipating a rise in the population of senior citizens in the area, the
management of Alfredo's Pizza is seeking to tap into this promising segment that consists of retired, affluent consumers. In this
instance, the managers of Alfredo's Pizza are anticipating company growth through ___.
A) market development B) product development C) mass customization
D) niche marketing E) product differentiation

11) FencePro, a local company, has developed an entirely new mounting system for chain link fences. After acquiring a distributor,
FencePro now has the ability to market its products nationwide. FencePro is most likely following a ________ strategy.
A) market penetration B) market development C) downsizing D) product adaptation E) product development

12) Amor, a successful brand of women's clothing, recently introduced a line of fitness equipment. This is an example of __.
A) mass customization B) niche marketing C) diversification D) prospecting E) product adaptation

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13) Sunny Brews is a coffeehouse chain based in Boston. It recently introduced Eva, a mild roast, which became immensely popular.
This exemplifies ________.
A) benchmarking B) diversification C) mass customization D) product development E) downsizing

14) A women's apparel manufacturer in California recently acquired a Houston-based company that manufactures office furniture.
This is an example of ________.
A) product development B) market development C) market penetration D) diversification E) product differentiation

15) Elmo Corp., a manufacturer of personal computers and printers, recently established an office furniture exporting business. This is
an example of ________.
A) niche marketing B) local marketing C) diversification D) product adaptation E) downsizing

16) "At Joe's Diner, we serve great burgers" is a product-oriented business definition.

17) "At Trader Joe's, our mission is to provide all our customers the best food and beverage values to be found anywhere, and the
information to make informed buying decisions." This is a product-oriented business definition.

18) RedFin manufactures diving equipment that is highly regarded by customers worldwide. Each department in RedFin contributes
to its success and can be thought of as a(n) ________.
A) link in the company's internal value chain B) separate organization C) independent subsidiary of the company
D) separate market segment E) SBU

19) An American airline company started a grocery chain in Australia. This is an example of product development.

20) Rob has been asked by his manager to identify a group of potential customers who would respond in a similar way to a given set
of marketing efforts. In this instance, Rob has been asked to identify a ________.
A) new product B) market segment C) marketing intermediary D) brand E) product line

21) Paul Robinson has identified a group of potential customers who seem to respond in a similar way to a series of magazine and
radio advertisements for his company's product. Paul has identified a(n) ________.
A) target market B) market segment C) niche market D) product attribute E) product design

22) Which of the following is true with regard to a market segment?

A) A market segment consists of consumers with dissimilar needs and preferences.
B) A market segment consists of consumers who respond in a similar way to a given set of marketing efforts.
C) Very few markets have segments.
D) Dividing the market into segments decreases the efficiency of the selling process.
E) Dividing the market into segments reduces composite demand.

23) Arrow is "a different kind of company, manufacturing a different kind of a car"; the RoadPro is "like nothing else." Statements
such as these reflect a firm's ________.
A) portfolio B) marketing segment C) positioning D) marketing mix E) mission statement

24) Alpha Motors offers "Green automobiles for a greener world." This refers to the ________ of Alpha automobiles.
A) brand resonance B) position C) brand equity D) pleasure value E) added value

25) Harris Brown, the marketing manager at a small retail chain, wants to assess his firm's strengths, opportunities,
weaknesses, and threats. Which of the following would be best suited for his purpose?
A) SWOT analysis B) cluster analysis C) portfolio analysis
D) regression analysis E) Porter's five forces analysis

26) Omega Inc. makes lightweight sunglasses with 100-percent UV protection for people who love to hunt, hike, and ride
bikes. The company's long-term plans include the development of lenses that, in addition to protecting users from UV
rays, would help reduce lens spotting through effective water-sheeting methods. This new feature would be valuable to
people who fish. Given the rising popularity of recreational fishing in the United States, Omega products clearly have a
huge market potential. In terms of a SWOT analysis, Omega has recognized a market ________.
A) weakness B) strength C) threat D) opportunity E) challenge

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27) Many managers think that "doing things right," or ________, is as important as, or even more important than, "doing
the right things."
A) strategy B) planning C) positioning D) implementation E) targeting

28) Berman Electronics, a chain of appliance stores in North America, caters to a wide range of customers. It has a
marketing organization in which different operational specialists head different marketing activities. Berman Electronics
is a(n) ________.
A) customer management organization B) niche marketer C) early adopter
D) functional organization E) laggard

29) Which of the following is true with regard to geographic organization?

A) It is the most common form of marketing organization.
B) Different marketing activities are headed by a functional specialist.
C) It requires salespeople to have international experience.
D) It reduces the overall efficiency of salespeople.
E) It allows salespeople to work with a minimum of travel time and cost.

30) Which of the following is a major advantage of the market organization?

A) The company is organized around the needs of specific customer segments.
B) The company exploits bleeding-edge technologies to keep ahead in the market.
C) The company has a flat organizational structure.
D) The company allows its salespeople to settle into a specific territory.
E) The company caters to a single, small market segment.

31) ________ planning involves adapting a firm to take advantage of opportunities in its constantly changing
environment.
A) media B) short-range C) annual D) long-range E) strategic

32) When a firm develops and maintains a strategic fit between its goals and capabilities, it is performing ________
planning.
A) business-portfolio B) values C) operations D) mission E) strategic

33) ________ is the first step in strategic planning.

A) Identify threats and weaknesses B) Define the company mission C) Develop the business portfolio
D) Set objectives and goals E) Plan marketing strategies

34) ________ is NOT a step in the strategic planning process.

A) Defining the company mission B) Evaluating all members of the value chain
C) Setting company objectives and goals D) Designing the business portfolio
E) Planning marketing and other functional strategies

35) Which of the following provides an answer to these questions: "What is our business?"; "Who are our customers?";
"What do our customers value?"; "What should our business be?".
A) objectives and goals B) operational strategies C) a mission statement
D) a business portfolio E) marketing and functional strategies

36) ________ should be market oriented and defined in terms of ________.

A) Mission statements; customers' needs B) Annual plans; product needs C) Strategic plans; company needs
D) Objectives; competitors' threats E) Long-range plans; company needs

37) All of the following statements are accurate guidelines for a company's mission statement EXCEPT which one?
A) It should motivate employees. B) It should be narrow.
C) It should emphasize the company's strengths in the marketplace. D) It should be specific. E) It should be realistic.

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38) A company's mission statement serves as a statement of ________.
A) values B) fact C) financial goals D) purpose E) employee commitment

39) Which of the following is NOT a market-oriented business definition?

A) "to sell tools and home repair and improvement items"
B) "to create fantasies - a place where dreams come true and the world still works the way it's supposed to."
C) "to sell life-style and self-expression; success and status; memories, hopes, and dreams."
D) "to bring aspiration and innovation to every athlete in the world"
E) "to make the Internet buying experience fast, easy, and enjoyable"

40) All of the following are examples of product-oriented mission statements, EXCEPT which one?
A) "We run theme parks." B) "We sell lifestyle and self-expression; success and status; memories, hopes, and dreams."
C) "We sell athletic shoes and apparel." D) "We rent hotel rooms." E) "We provide organic products."

41) The principle objective of a market-oriented mission statement is to satisfy basic ________ needs.
A) stockholder B) partnership C) customer D) owner E) supplier

42) Revlon has clearly defined its "mission" of selling lifestyle and self-expression. In order for the firm to launch its
strategic plan, the mission needs to be turned into detailed ________ that guide each level of the company.
A) supporting objectives B) product mixes C) sets of tactics
D) sets of promotional tools E) sets of strategies

43) The collection of businesses and products that make up a company is called its ________.
A) business portfolio B) operational factor C) strategic business unit D) mission statement E) strategic plan

44) ________ can be a company division, a product line within a division, or sometimes a single product or brand.
A) An SBU B) The BCG C) A market D) A value delivery network E) A PLC

45) After management has identified the key businesses making up its company, what is the next step in portfolio
analysis?
A) identifying businesses in which to invest B) assessing the attractiveness of its SBUs
C) deciding whether to harvest any businesses D) identifying SBUs E) completing short-range planning

46) The best known product portfolio planning method was developed by ________.
A) Harvard University B) the SRI Consulting Firm C) the Boston Consulting Group
D) Philip Kotler E) Gary Armstrong

47) Most portfolio analysis methods evaluate SBUs on two dimensions, namely ________ and ________.
A) market share; the strength of the SBU's position B) market growth rates; profits
C) market penetration; market development D) market or industry attractiveness; the strength of the SBU's position
E) market diversification; relative market share

48) In the Boston Consulting Group approach, ________ provides a measure of market attractiveness.
A) market growth rate B) market segmentation C) market development
D) relative market share E) market penetration

49) In the Boston Consulting Group approach, ________ serves as a measure of company strength in the market.
A) market development B) market segmentation C) market diversification
D) market growth rate E) relative market share

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50) The BCG growth-share matrix classifies four types off SBUs. They are ________, ______, ______, and ________.
A) planning; implementing; leading; controlling
B) sales; market share; price; promotion
C) stars; cash cows; question marks; dogs
D) market penetration; market development; product development; diversification
E) product; price; promotion; placement

51) In the BCG approach, ________ are high-share, high-growth businesses or products. They need heavy investment to
finance rapid growth. When their growth slows down, they turn into ________.
A) stars; cash cows B) stars; question marks C) question marks; dogs D) dogs; cash cows E) cash cows; stars

52) ________ are low-growth, high share businesses or products. They generate a lot of cash that the firm uses to pay its
bills and support other SBUs that need investment.
A) Question marks B) Cats C) Dogs D) Stars E) Cash cows

53) In the BCG matrix, income from ________ can be used to help finance the company's question marks and stars.
A) SBU revenues B) overseas operations C) low-share businesses D) dogs E) cash cows

54) The four possible strategies that can be pursued for each SBU are building, holding, ________, and ________.
A) promoting; selling B) developing; growing C) diversifying; penetrating
D) harvesting; divesting E) downsizing; expanding

55) Which of the following statements does NOT accurately reflect a problem with the BCG matrix approach?
A) It is difficult to define SBUs and measure market share and growth. B) It can be time consuming to implement.
C) It can be costly to conduct. D) It focuses on classifying current businesses.
E) It focuses on planning for the future.

56) Unlike strategic-planning efforts of the past, which were conducted primarily by senior managers, today's strategic
planning is ________.
A) product oriented B) centralized C) short-term oriented D) limitation-free E) decentralized

57) Through a wide variety of sandwiches and a series of acquisitions and joint ventures, the Mo'men brothers were able
to expand gradually throughout the Arab world.These are examples of ________.
A) diversification B) product development C) brand experiences
D) broad strategies for growth E) value chains

58) Which department in a company carries the primary responsibility for achieving profitable growth?
A) operations B) accounting C) human resources D) product development E) marketing

59) The ________ is a useful tool for identifying growth opportunities.

A) BCG matrix B) product/market expansion grid C) value delivery network
D) value chain E) business portfolio

60) Making more sales to current customers without changing a firm's products is ________.
A) market penetration B) market attractiveness C) diversification
D) market development E) product development

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 ANSWERS:

1) B 11) B 21) B 31) E 41) C 51) A

2) E 12) C 22) B 32) E 42) A 52) E
3) D 13) D 23) C 33) B 43) A 53) E
4) D 14) D 24) B 34) B 44) A 54) D
5) A 15) C 25) A 35) C 45) B 55) E
6) C 16) TRUE 26) D 36) A 46) C 56) E
7) D 17) FALSE 27) D 37) B 47) D 57) D
8) B 18) A 28) D 38) D 48) A 58) E
9) D 19) FALSE 29) E 39) A 49) E 59) B
10) A 20) B 30) A 40) B 50) C 60) A