Question 1

The risks of a focused strategy based on either low-cost or differentiation include

Accepted Answer

A)  the chance that niche customers will bargain more aggressively for good deals than customers in the overall marketplace. 
B)  the potential for the preferences and needs of niche members to shift over time towards many of the same product attributes and capabilities desired by buyers in the mainstream portion of the market. 
C)  the potential for the segment to be highly vulnerable to economic cycles. 
D)  the potential for segment growth to race beyond the production or service capabilities of incumbent firms. 
E)  All of these. 
A)  the chance that niche customers will bargain more aggressively for good deals than customers in the overall marketplace. 
B)  the potential for the preferences and needs of niche members to shift over time towards many of the same product attributes and capabilities desired by buyers in the mainstream portion of the market. 
C)  the potential for the segment to be highly vulnerable to economic cycles. 
D)  the potential for segment growth to race beyond the production or service capabilities of incumbent firms. 
E)  All of these. B

Question 2

What are the distinctive features of a broad differentiation strategy? Under what circumstances is a broad differentiation strategy appealing?

Accepted Answer

Answer will vary

Question 3

A broad differentiation strategy generally produces the best results in situations where

Accepted Answer

A)  buyer brand loyalty is low. 
B)  buyer needs and uses of the product are diverse. 
C)  new and improved products are introduced only infrequently. 
D)  most rivals are pursuing a differentiation strategy and are seeking to differentiate their products on most of the same features and attributes. 
E)  price competition is vigorous. 
A)  buyer brand loyalty is low. 
B)  buyer needs and uses of the product are diverse. 
C)  new and improved products are introduced only infrequently. 
D)  most rivals are pursuing a differentiation strategy and are seeking to differentiate their products on most of the same features and attributes. 
E)  price competition is vigorous. B

Question 4

The essence of a broad differentiation strategy is to

Accepted Answer

A)  appeal to the high end part of the market and concentrate on providing a top-of-the-line product to consumers. 
B)  incorporate a greater number of differentiating features into its product/service than rivals. 
C)  lower buyer switching costs. 
D)  outspend rivals on advertising and promotion in order to inform and convince buyers of the value of its differentiating attributes. 
E)  be unique in ways that are valuable and appealing to a wide range of buyers. 
A)  appeal to the high end part of the market and concentrate on providing a top-of-the-line product to consumers. 
B)  incorporate a greater number of differentiating features into its product/service than rivals. 
C)  lower buyer switching costs. 
D)  outspend rivals on advertising and promotion in order to inform and convince buyers of the value of its differentiating attributes. 
E)  be unique in ways that are valuable and appealing to a wide range of buyers.

Question 5

Explain how the strategic target of a low-cost provider differs from the strategic target of a best-cost provider.

Accepted Answer

The answer of Explain how the strategic target of a...

Question 6

A company that succeeds in differentiating its product offering from those of its rivals can usually

Accepted Answer

A)  avoid having to compete on the basis of simply a low price. 
B)  charge a price premium for its product. 
C)  increase unit sales. 
D)  gain buyer loyalty to its brand. 
E)  All of these. 
A)  avoid having to compete on the basis of simply a low price. 
B)  charge a price premium for its product. 
C)  increase unit sales. 
D)  gain buyer loyalty to its brand. 
E)  All of these.

Question 7

Perceived value and signaling value are often an important part of a successful differentiation strategy because

Accepted Answer

A)  of the diversity of buyer needs and preferences. 
B)  buyers seldom will pay for value they don't perceive, no matter how real the value of the differentiating extras may be. 
C)  buyer satisfaction can be enhanced by clever ads that signal value that relates to the buyer. 
D)  differentiation is all about smoke and mirrors. 
E)  there are no other ways to differentiate a commodity product. 
A)  of the diversity of buyer needs and preferences. 
B)  buyers seldom will pay for value they don't perceive, no matter how real the value of the differentiating extras may be. 
C)  buyer satisfaction can be enhanced by clever ads that signal value that relates to the buyer. 
D)  differentiation is all about smoke and mirrors. 
E)  there are no other ways to differentiate a commodity product.

Question 8

Successful differentiation allows a firm to

Accepted Answer

A)  be the industry's best-cost provider. 
B)  set the industry ceiling on price. 
C)  avoid being dragged into a price war with industry rivals and not be overly concerned about whether entry barriers into the industry are high or low. 
D)  command a premium price for its product, and/or increase unit sales, and/or gain buyer loyalty to its brand. 
E)  take sales and market share away from rivals by undercutting them on price. 
A)  be the industry's best-cost provider. 
B)  set the industry ceiling on price. 
C)  avoid being dragged into a price war with industry rivals and not be overly concerned about whether entry barriers into the industry are high or low. 
D)  command a premium price for its product, and/or increase unit sales, and/or gain buyer loyalty to its brand. 
E)  take sales and market share away from rivals by undercutting them on price.

Question 9

What market conditions and circumstances make a low-cost provider strategy attractive? What are the pitfalls in pursuing a low-cost provider strategy-what can go wrong?

Accepted Answer

A low-cost provider strategy is attracti

Question 10

A competitive strategy of striving to be the low-cost provider is particularly attractive when

Accepted Answer

A)  buyers are not very brand-conscious. 
B)  most rivals are trying to be best-cost providers. 
C)  there are many ways to achieve product differentiation that have value to buyers. 
D)  buyers are large and have significant power to bargain down prices and buyers use the product in much the same ways. 
E)  most rivals are pursuing focused low-cost or focused differentiation strategies. 
A)  buyers are not very brand-conscious. 
B)  most rivals are trying to be best-cost providers. 
C)  there are many ways to achieve product differentiation that have value to buyers. 
D)  buyers are large and have significant power to bargain down prices and buyers use the product in much the same ways. 
E)  most rivals are pursuing focused low-cost or focused differentiation strategies.

Question 11

The marketing emphasis of a company pursuing a broad differentiation strategy usually is to

Accepted Answer

A)  underprice rival brands with comparable features. 
B)  tout differentiating features and charge a premium price that more than covers the extra costs of differentiating features. 
C)  out-advertise rivals and make frequent use of discount coupons. 
D)  emphasize selling direct to end-users and promoting personalized customer service. 
E)  communicate the product's ability to serve the customer's every need. 
A)  underprice rival brands with comparable features. 
B)  tout differentiating features and charge a premium price that more than covers the extra costs of differentiating features. 
C)  out-advertise rivals and make frequent use of discount coupons. 
D)  emphasize selling direct to end-users and promoting personalized customer service. 
E)  communicate the product's ability to serve the customer's every need.

Question 12

A low-cost leader can translate its low-cost advantage over rivals into superior profit performance by

Accepted Answer

A)  cutting its price to levels significantly below the prices of rivals. 
B)  either using its low-cost edge to underprice competitors and attract price sensitive buyers in large enough numbers to increase total profits or refraining from price-cutting and using the low-cost advantage to earn a bigger profit margin on each unit sold. 
C)  going all out to use its cost advantage to capture a dominant share of the market. 
D)  spending heavily on advertising to promote its cost advantage and the fact that it charges the lowest prices in the industry-it can then use this reputation for low prices to build very strong customer loyalty, gain repeat sales year after year, and earn sustained profits over the long-term. 
E)  outproducing rivals and thus having more units available to sell. 
A)  cutting its price to levels significantly below the prices of rivals. 
B)  either using its low-cost edge to underprice competitors and attract price sensitive buyers in large enough numbers to increase total profits or refraining from price-cutting and using the low-cost advantage to earn a bigger profit margin on each unit sold. 
C)  going all out to use its cost advantage to capture a dominant share of the market. 
D)  spending heavily on advertising to promote its cost advantage and the fact that it charges the lowest prices in the industry-it can then use this reputation for low prices to build very strong customer loyalty, gain repeat sales year after year, and earn sustained profits over the long-term. 
E)  outproducing rivals and thus having more units available to sell.

Question 13

Which of the following is not one of the four basic routes to achieving a differentiation-based competitive advantage?

Accepted Answer

A)  Delivering value to customers via competencies and competitive capabilities that rivals don't have or can't afford to match 
B)  Incorporating features that raise product performance 
C)  Incorporating product attributes and user features that lower the buyer's overall costs of using the company's product 
D)  Appealing to buyers who are sophisticated and shop hard for the best, stand-out differentiating attributes 
E)  Incorporating features that enhance buyer satisfaction in intangible or non-economic ways 
A)  Delivering value to customers via competencies and competitive capabilities that rivals don't have or can't afford to match 
B)  Incorporating features that raise product performance 
C)  Incorporating product attributes and user features that lower the buyer's overall costs of using the company's product 
D)  Appealing to buyers who are sophisticated and shop hard for the best, stand-out differentiating attributes 
E)  Incorporating features that enhance buyer satisfaction in intangible or non-economic ways

Question 14

A company attempting to be successful with a broad differentiation strategy has to

Accepted Answer

A)  study buyer needs and behavior carefully to learn what buyers consider important, what they think has value, and what they are willing to pay for. 
B)  incorporate more differentiating features into its product/service than rivals. 
C)  concentrate its differentiating efforts on marketing and advertising (where almost all differentiating features are created). 
D)  have a widely known and highly respected brand name image. 
E)  provide a top-of-the-line product and sell it at premium prices. 
A)  study buyer needs and behavior carefully to learn what buyers consider important, what they think has value, and what they are willing to pay for. 
B)  incorporate more differentiating features into its product/service than rivals. 
C)  concentrate its differentiating efforts on marketing and advertising (where almost all differentiating features are created). 
D)  have a widely known and highly respected brand name image. 
E)  provide a top-of-the-line product and sell it at premium prices.

Question 15

Which one of the following generic types of competitive strategy is typically the best strategy for a company to employ?

Accepted Answer

A)  A low-cost leadership strategy 
B)  A broad differentiation strategy 
C)  A best-cost provider strategy 
D)  A focused low-cost provider strategy 
E)  There is no such thing as a "best" competitive strategy; a company's "best" strategy is always one that is customized to fit both industry and competitive conditions and the company's own resources and competitive capabilities. 
A)  A low-cost leadership strategy 
B)  A broad differentiation strategy 
C)  A best-cost provider strategy 
D)  A focused low-cost provider strategy 
E)  There is no such thing as a "best" competitive strategy; a company's "best" strategy is always one that is customized to fit both industry and competitive conditions and the company's own resources and competitive capabilities.

Question 16

Broad differentiation strategies are well-suited for market circumstances where

Accepted Answer

A)  there are many ways to differentiate the product or service and many buyers perceive these differences as having value. 
B)  most buyers have the same needs and use the product in the same ways. 
C)  buyers are susceptible to clever advertising. 
D)  barriers to entry are high and suppliers have a low degree of bargaining power. 
E)  price competition is especially vigorous. 
A)  there are many ways to differentiate the product or service and many buyers perceive these differences as having value. 
B)  most buyers have the same needs and use the product in the same ways. 
C)  buyers are susceptible to clever advertising. 
D)  barriers to entry are high and suppliers have a low degree of bargaining power. 
E)  price competition is especially vigorous.

Question 17

What is the difference between a low-cost leadership strategy and a focused low-cost strategy?

Accepted Answer

A low-cost leadership strategy and a foc

Question 18

One of the big dangers in crafting a competitive strategy is that managers,torn between the pros and cons of the various generic strategies,will opt for "stuck in the middle" strategies that represent compromises between lower costs and greater differentiation and between broad and narrow market appeal.True or false? Explain your answer.

Accepted Answer

The answer of One of the big dangers in crafting...

Question 19

What type of competitive advantage does a best-cost provider strategy aim at achieving? Explain what a company has to do to achieve this advantage.

Accepted Answer

The answer of What type of competitive advantage does a...

Question 20

Describe the two basic cost-reducing approaches a company can take to become a low-cost provider in its industry.

Accepted Answer

The answer of Describe the two basic cost-reducing approaches a...

The risks of a focused strategy based on either low-cost or differentiation include

What are the distinctive features of a broad differentiation strategy? Under what circumstances is a broad differentiation strategy appealing?

A broad differentiation strategy generally produces the best results in situations where

The essence of a broad differentiation strategy is to

Explain how the strategic target of a low-cost provider differs from the strategic target of a best-cost provider.

A company that succeeds in differentiating its product offering from those of its rivals can usually

Perceived value and signaling value are often an important part of a successful differentiation strategy because

Successful differentiation allows a firm to

What market conditions and circumstances make a low-cost provider strategy attractive? What are the pitfalls in pursuing a low-cost provider strategy-what can go wrong?

A competitive strategy of striving to be the low-cost provider is particularly attractive when

The marketing emphasis of a company pursuing a broad differentiation strategy usually is to

A low-cost leader can translate its low-cost advantage over rivals into superior profit performance by

Which of the following is not one of the four basic routes to achieving a differentiation-based competitive advantage?

A company attempting to be successful with a broad differentiation strategy has to

Which one of the following generic types of competitive strategy is typically the best strategy for a company to employ?

Broad differentiation strategies are well-suited for market circumstances where

What is the difference between a low-cost leadership strategy and a focused low-cost strategy?

What type of competitive advantage does a best-cost provider strategy aim at achieving? Explain what a company has to do to achieve this advantage.

Describe the two basic cost-reducing approaches a company can take to become a low-cost provider in its industry.

What Is Strategy and Why Is It Important

Charting a Companys Direction: Vision and Mission, Objectives, and Strategy

Evaluating a Companys External Environment

Evaluating a Companys Resources, Capabilities, and Competitiveness

Strengthening a Companys Competitive Position: Strategic Moves, timing, and Scope of Operation

Strategies for Competing in International Markets

Corporate Strategy: Diversification and the Multibusiness Company

Ethics, Corporate Social Responsibility, Environmental Sustainability, and Strategy

Building an Organization Capable of Good Strategy Execution: People, Capabilities, and Structure

Managing Internal Operations: Actions That Promote Good Strategy Execution

Corporate Culture and Leadership: Keys to Good Strategy Execution

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Exam 5: The Five Generic Competitive Strategies: Which One to Employ

The risks of a focused strategy based on either low-cost or differentiation include

What are the distinctive features of a broad differentiation strategy? Under what circumstances is a broad differentiation strategy appealing?

A broad differentiation strategy generally produces the best results in situations where

The essence of a broad differentiation strategy is to

Explain how the strategic target of a low-cost provider differs from the strategic target of a best-cost provider.

A company that succeeds in differentiating its product offering from those of its rivals can usually

Perceived value and signaling value are often an important part of a successful differentiation strategy because

Successful differentiation allows a firm to

What market conditions and circumstances make a low-cost provider strategy attractive? What are the pitfalls in pursuing a low-cost provider strategy-what can go wrong?

A competitive strategy of striving to be the low-cost provider is particularly attractive when

The marketing emphasis of a company pursuing a broad differentiation strategy usually is to

A low-cost leader can translate its low-cost advantage over rivals into superior profit performance by

Which of the following is not one of the four basic routes to achieving a differentiation-based competitive advantage?

A company attempting to be successful with a broad differentiation strategy has to

Which one of the following generic types of competitive strategy is typically the best strategy for a company to employ?

Broad differentiation strategies are well-suited for market circumstances where

What is the difference between a low-cost leadership strategy and a focused low-cost strategy?

What type of competitive advantage does a best-cost provider strategy aim at achieving? Explain what a company has to do to achieve this advantage.

Describe the two basic cost-reducing approaches a company can take to become a low-cost provider in its industry.

What Is Strategy and Why Is It Important

Charting a Companys Direction: Vision and Mission, Objectives, and Strategy

Evaluating a Companys External Environment

Evaluating a Companys Resources, Capabilities, and Competitiveness

Strengthening a Companys Competitive Position: Strategic Moves, timing, and Scope of Operation

Strategies for Competing in International Markets

Corporate Strategy: Diversification and the Multibusiness Company

Ethics, Corporate Social Responsibility, Environmental Sustainability, and Strategy

Building an Organization Capable of Good Strategy Execution: People, Capabilities, and Structure

Managing Internal Operations: Actions That Promote Good Strategy Execution

Corporate Culture and Leadership: Keys to Good Strategy Execution

Filters