Deck 2: Company and Marketing Strategy: Partnering to Build Customer Relationships

Question 1

When using a harvesting strategy for a particular strategic business unit,a company ________.

A)focuses on gaining short-term cash flow regardless of long-term concerns
B)invests more in the business unit to build its market share
C)sells off the strategic business unit and invests its resources elsewhere
D)invests just enough in the strategic business unit to keep its market share at the current level
E)gradually increases investment in the strategic business unit over time, to maximize profits

Answer 1

A

Question 2

Cosmetics firm SatinSilk is revamping its mission statement and advertising strategy.The planning team comes up with a list of options for the new mission statement.The CEO stresses that the new mission statement should be market-oriented rather than product-oriented.Which of the following mission statements should the company pick?

A)to create the best possible products and sell them at the best possible price
B)to sell cosmetics products that are hypoallergenic and made only from the finest natural materials
C)to give customers the complexion they dream about by providing a range of products suited to their needs
D)to sell affordably priced cosmetics in every cosmetics product category
E)to increase our market share in the cosmetics segment and increase profit margins

Answer 2

C

Question 3

Which of the following companies is using a divesting strategy?

A)Juggernaut Bikes aims to maintain its market share, but does not have the resources to increase its share.
B)Noting the potential for growing its market share, LBD Inc. steps up investments in advertising and promotion.
C)When sales of its clothing division decline, Blackstone's sells off the division to a competitor.
D)Getix Computers is increasing the price of its products in order to maximize its short-term profits.
E)Harlow's market share remains steady over two years even though the company does not increase investment in the product in that time.

Answer 3

C

Question 4

Which of the following products would CypressSound classify as a question mark in on its BCG matrix?

A)Cyan, a cell phone that is specially designed for music lovers, has a very low market share, though the market is growing steadily.
B)The home entertainment system offered by CypressSound has a strong market share, and the market is likely to expand in the future.
C)Xpress, an MP3 player, has a high market share, but the market for MP3 players is not expected to grow significantly.
D)AutoPlay, the company's audio product for installation in cars, has a high market share, and the market for these systems has been growing constantly.
E)Unipress, a CD player, has a very low market share in a market that is shrinking rapidly.

Question 5

Which of the following is true of the growth-share matrix?

A)A company should invest in a question mark rather than a dog.
B)The positions of SBUs in the growth-share matrix do not change over time.
C)Stars are those SBUs with a high market share in a market that does not have a high growth rate.
D)All products go through all four categories of the BCG matrix over their life cycles.
E)The most appropriate strategy for a question mark SBU is divestment.

Question 6

Which of the following criteria does the Boston Consulting Group approach use to provide a measure of the company's strength in the market?

A)relative market share
B)return on marketing investment
C)market sentiment
D)market growth rate
E)marketing return on sales

Question 7

Which of the following is true of strategic planning in a firm?

A)Strategic planning deals with maintaining the company's current business ventures.
B)Strategic planning focuses on the firm's internal environment rather than the external environment.
C)Strategic planning occurs at the business-unit, product, and market levels rather than a company-wide level.
D)Strategic planning deals with adapting the firm to take advantage of opportunities in its changing environment.
E)Strategic planning involves the formulation of supporting objectives for business units based on the company's mission statement.

Question 8

A company's increasing its sales in a particular market without modifying its products is referred to as ________.

A)market development
B)market differentiation
C)market penetration
D)product development
E)diversification

Question 9

Which of the following products would CypressSound classify as a cash cow in on its BCG matrix?

A)Cyan, a cell phone that is specially designed for music lovers, has a very low market share, though the market is growing steadily.
B)The home entertainment system offered by CypressSound has a strong market share, and the market is likely to expand in the future.
C)Xpress, an MP3 player, has a high market share, but the market for MP3 players is not expected to grow significantly.
D)AutoPlay, the company's audio product for installation in cars, has a high market share, and the market for these systems has been growing constantly.
E)Unipress, a CD player, has a very low market share in a market that is shrinking rapidly.

Question 10

Which of the following best describes a company's business portfolio?

A)the company's sources of revenue and the investments it makes in a particular year
B)the various industries in which the company operates business ventures
C)the company's products or services in a particular market category
D)the collection of businesses and products that make up the company
E)the company's strengths in terms of technology, people, products, advertising, etc.

Question 11

In the BCG growth-share matrix,stars refer to ________.

A)products with a low market share in a niche market
B)products with a low relative market share in a market with high growth prospects
C)products that have a greater market share than all their competitors combined in a saturated market
D)products with a high market share in a market with a high growth rate
E)products with a low market share in a market that is set to decrease significantly

Question 12

Which of the following criteria does the Boston Consulting Group approach use to provide a measure of market attractiveness?

A)relative market share
B)market sentiment
C)return on marketing investment
D)market growth rate
E)marketing return on sales

Question 13

In the BCG matrix,________ refer to 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)stars
B)cash cows
C)question marks
D)dogs
E)black holes

Question 14

Omni Healthcare's analgesic drug Cetaprin has a 40% share in the analgesics market in Terrania.Its closest competitor,Febex,has a 25% share in the market,while three other drugs split the remainder.Which of the following would most indicate that Cetaprin would be classified as a star according to the BCG matrix?

A)Cetaprin is priced higher than other similar products in the market.
B)A customer survey revealed that Cetaprin has the highest brand-name recognition of any analgesic in the market.
C)The demand for analgesic drugs in the Terranian market is expected to remain stable.
D)Febex is rapidly gaining market share over Cetaprin as a result of aggressive marketing efforts.
E)The Terranian market for healthcare products is expanding rapidly.

Question 15

In the BCG matrix,________ are low-share businesses and products in a market that is not expected to grow.They may generate enough cash to maintain themselves but do not promise to be large sources of cash.

A)dogs
B)cash cows
C)black holes
D)stars
E)question marks

Question 16

Which of the following is true of company mission statements?

A)Mission statements should be defined in terms of satisfying customer needs.
B)A firm's mission statement should be product-oriented, focusing on the products the company sells.
C)Mission statements should not be specific, as this reduces the company's potential for growth.
D)A company mission statement should be directed at the company's publics rather than at its employees.
E)Mission statements should focus both on the company's product as well as the technology used to produce it.

Question 17

Omni Healthcare's analgesic drug Cetaprin has a 40% share in the analgesics market in Terrania.Its closest competitor,Febex,has a 25% share in the market,while three other drugs split the remainder.Which of the following would most indicate that Cetaprin would be classified as a cash cow according to the BCG matrix?

A)Cetaprin is priced higher than other similar products in the market.
B)A customer survey revealed that Cetaprin has the highest brand-name recognition of any analgesic in the market.
C)The demand for analgesic drugs in the Terranian market is expected to remain stable.
D)Febex is rapidly gaining market share over Cetaprin as a result of aggressive marketing efforts.
E)The Terranian market for healthcare products is expanding rapidly.

Question 18

When divesting a particular strategic business unit,a company ________.

A)focuses on gaining short-term cash flow regardless of long-term concerns
B)invests more in the business unit to build its market share
C)sells off or phases out the strategic business unit
D)invests just enough in the strategic business unit to keep its market share at the current level
E)gradually increases investment in the strategic business unit over time, to maximize profits

Question 19

In the BCG growth-share matrix,question marks refer to ________.

A)products with a low market share in a niche market
B)products with a low relative market share in a market with high growth prospects
C)products that have a greater market share than all their competitors combined in a saturated market
D)products with a high market share in a market with a high growth rate
E)products with a low market share in a market that is set to decrease significantly

Question 20

Nathan is conducting a portfolio analysis for his company.Which of the following activities would this involve?

A)studying the products and strategies of competitors in order to improve the company's own products
B)collecting consumer feedback in order to better position the company's products in the minds of consumers
C)evaluating the attractiveness of an SBU's market and the strength of its position in the market
D)segmenting the company's markets to effectively reach the target consumers
E)conducting marketing research to estimate the efficiency and effectiveness of the company's marketing strategy

Question 21

Which of the following groups is included in a company's value chain?

A)customers
B)suppliers
C)employees
D)distributors
E)competitors

Question 22

The process of dividing a market into distinct groups of buyers with different needs,characteristics,or behaviors is called ________.

A)market targeting
B)positioning
C)diversification
D)market segmentation
E)market penetration

Question 23

Ainsworth's is a toy manufacturer based in Australia.Which of the following indicates that the company is following a market development strategy?

A)Ainsworth's introduces a line of children's clothing in Australia.
B)Ainsworth's licenses toy rights for a popular cartoon character in order to boost its sales.
C)Ainsworth's introduces its toys in the Indian and South-East Asian markets.
D)Ainsworth's enters the U.S. market with a line of children's clothing.
E)Ainsworth's develops a range of educational toys and school supplies in its current market.

Question 24

Company growth through starting up or acquiring businesses outside the company's current products and markets is called ________.

A)vertical integration
B)market development
C)diversification
D)market penetration
E)product development

Question 25

Starbucks has introduced a debit card that lets its customers prepay for coffee and snacks.This effort by Starbucks management is an example of ________.

A)market development
B)product development
C)diversification
D)market penetration
E)product adaptation

Question 26

________ refers to the process of evaluating each market segment's attractiveness and selecting one or more segments to enter.

A)Divesting
B)Diversification
C)Market targeting
D)Market mix
E)Positioning

Question 27

Ainsworth's is a toy manufacturer based in Australia.Which of the following indicates that the company is following a diversification strategy?

A)Ainsworth's introduces a line of children's clothing in Australia.
B)Ainsworth's licenses toy rights for a popular cartoon character in order to boost its sales.
C)Ainsworth's introduces its toys in the Indian and South-East Asian markets.
D)Ainsworth's enters the U.S. market with a line of children's clothing.
E)Ainsworth's develops a range of educational toys and school supplies in its current market.

Question 28

Which of the following best describes the value chain of a company?

A)the collection of businesses and products that make up the company
B)the series of cash cows and stars in the company's product line-up
C)the touchpoints at which a company or brand interacts with consumers of the company's products
D)the series of departments that design, produce, market, deliver, and support a firm's products
E)the collection of all the products in a particular product line

Question 29

A ________ is made up of the company,its suppliers,its distributors,and its customers,who partner with each other to improve the performance of the entire system.

A)value chain
B)strategic business unit
C)business portfolio
D)value-delivery network
E)growth-ratio matrix

Question 30

When pursuing a market penetration strategy,a company aims to improve sales by ________.

A)entering a new market in addition to its current market
B)introducing a new variant of its product in a new market
C)increasing distribution efforts in its current market
D)introducing its product in a new market without making any changes to the product
E)selling a new product in its current market

Question 31

Which of the following groups is included in both a company's value chain and its value delivery network?

A)customers
B)suppliers
C)employees
D)distributors
E)competitors

Question 32

Acme Inc.,has modified the production processes of its widgets and gadgets in order to enter the Eastern European market.Acme is likely following a ________ strategy.

A)market penetration
B)market development
C)diversification
D)harvesting
E)product development

Question 33

Ainsworth's is a toy manufacturer based in Australia.Which of the following indicates that the company is following a market penetration strategy?

A)Ainsworth's introduces a line of children's clothing in Australia.
B)Ainsworth's licenses toy rights for a popular cartoon character in order to boost its sales.
C)Ainsworth's introduces its toys in the Indian and South-East Asian markets.
D)Ainsworth's enters the U.S. market with a line of children's clothing.
E)Ainsworth's develops a range of educational toys and school supplies in its current market.

Question 34

Greyzone,a company manufacturing office furniture,is based in Terrania,but is looking to sell its products in other countries as well.The company identifies the country of Nyevka as a good option,as the cultures and tastes of consumers in the two countries are similar.Which of the following strategies is Greyzone using?

A)market penetration
B)market development
C)downsizing
D)diversification
E)product development

Question 35

Greyzone,a company manufacturing office furniture,is based in Terrania.Greyzone aims to increase sales of its products in Terrania by increasing its advertising efforts and undertaking frequent promotional events.Which of the following strategies is Greyzone using?

A)market penetration
B)market development
C)downsizing
D)diversification
E)product development

Question 36

Greyzone,a company that creates customized furniture,is based in Terrania,but is looking to enter other countries as well.The company identifies the country of Nyevka as a good option,as the entry barriers to new companies are low.Which of the following would most indicate that Greyzone is following a diversification strategy?

A)As the lifestyles of the people in the two countries are similar, Greyzone did not need to modify its products in the new market.
B)Greyzone leaves the Terranian market entirely in order to establish itself in the Nyevkan market.
C)Noting that Nyevka lacks well-established suppliers of office equipment, Greyzone begins to supply these products.
D)Greyzone manufactures furniture in Terrania itself, and ships it to Nyevka without setting up outlets in Nyevka.
E)Noting that the production costs would be lower in Nyevka, Greyzone shifts its production operations entirely to Nyevka.

Question 37

________ refers to reducing the business portfolio by eliminating products that no longer fit the company's overall strategy.

A)Market segmentation
B)Vertical integration
C)Product line extension
D)Downsizing
E)Diversification

Question 38

The market penetration and market development strategies are similar in that ________.

A)both strategies involve selling the company's current products
B)both strategies involve selling in the company's current market
C)both strategies involve selling in new as well as existing markets
D)both strategies involve the development of a new product
E)both strategies involve leaving the current market

Question 39

Which of the following best describes product positioning?

A)actually differentiating the market offering to create superior customer value
B)identifying consumer needs and creating a product to meet those needs
C)arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers
D)the process of evaluating each market segment's attractiveness and selecting one or more segments to enter
E)dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors

Question 40

The product development and diversification strategies are similar in that ________.

A)both strategies involve selling the company's current products
B)both strategies involve selling in the company's current market
C)both strategies involve selling in new as well as existing markets
D)both strategies involve the development of a new product
E)both strategies involve leaving the current market

Question 41

Which of the following is included in the "place" component of a company's marketing mix?

A)packaging
B)sales promotion
C)brand name
D)inventory
E)discounts

Question 42

The process that turns marketing plans into marketing actions to accomplish strategic marketing objectives is called ________.

A)marketing analysis
B)marketing implementation
C)marketing control
D)marketing audits
E)marketing budgeting

Question 43

________ involves looking at whether a company's basic strategies are well matched to its opportunities.

A)Operating control
B)Task control
C)Agency control
D)Strategic control
E)Clan control

Question 44

Evaluating the results of marketing strategies and plans and taking corrective action to ensure that objectives are attained is called ________.

A)marketing control
B)marketing implementation
C)market planning
D)marketing development
E)market targeting

Question 45

In a SWOT analysis,________ refer to external factors that the company may be able to exploit to its advantage.

A)strengths
B)strategies
C)weaknesses
D)opportunities
E)controls

Question 46

In the marketing mix,design,packaging,services,and features are all included in the category of ________.

A)product
B)price
C)promotion
D)place
E)people

Question 47

Arranging for a product to occupy a clear,distinctive,and desirable place relative to competing products in the minds of target consumers is known as ________.

A)product placement
B)positioning
C)divesting
D)market penetration
E)diversification

Question 48

In a SWOT analysis,________ refer to external factors that the company may be able to exploit to its advantage.

A)strengths
B)strategies
C)weaknesses
D)opportunities
E)controls

Question 49

A group of consumers who respond in a similar way to a given set of marketing efforts is the company's ________.

A)value chain
B)market segment
C)strategic business unit
D)business portfolio
E)cash cow

Question 50

Which of the following best describes market segmentation?

A)actually differentiating the market offering to create superior customer value
B)identifying consumer needs and creating a product to meet those needs
C)arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers
D)the process of evaluating each market segment's attractiveness and selecting one or more segments to enter
E)dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors

Question 51

In a SWOT analysis,which of the following would be considered a weakness for a company?

A)an unfavorable economic climate that discourages consumption
B)the exit of a competitor from the market
C)inflation, which leads to higher prices of the company's products
D)decreasing consumer interest in its products
E)the company's competitor developing improved production technology

Question 52

In a SWOT analysis,which of the following would be considered a strength for a company?

A)a favorable economic climate that encourages consumption
B)the exit of a competitor from the market
C)inflation, which leads to higher prices of the company's products
D)increasing consumer interest in its products
E)the company developing improved production technology

Question 53

Channels,inventory,logistics,and transportation are included in the ________ component of the marketing mix.

A)people
B)price
C)product
D)place
E)promotion

Question 54

Which of the following is included in the "price" component of a company's marketing mix?

A)packaging
B)sales promotion
C)brand name
D)inventory
E)discounts

Question 55

Which of the following measures the profits generated by investments in marketing activities?

A)SWOT analysis
B)the BCG matrix
C)the growth/share matrix
D)marketing ROI
E)the product/market expansion grid

Question 56

Which of the following is a primary characteristic of strategic control rather than operating control?

A)determining the profitability of different products, territories, markets, and channels
B)ensuring that the company achieves the sales, profits, and other goals set out in its annual plan
C)checking ongoing performance against the annual plan and taking corrective action when necessary
D)looking at whether the company's basic strategies are well matched to its opportunities
E)monitoring ongoing company operations to ensure that efficiency and effectiveness are maximized

Question 57

Which of the following is true of marketing ROI?

A)Marketing ROI uses only those marketing effects that are measured in dollar terms.
B)Marketing ROI ignores customer-centered measures of marketing impact, such as customer acquisition and retention.
C)Marketing ROI is the net return from a marketing investment divided by the profit from the marketing investment.
D)Marketing ROI cannot be assessed in terms of standard marketing performance measures, such as brand awareness, sales, or market share.
E)Marketing ROI measures the profits generated by investments in marketing activities.

Question 58

Which of the following best describes the functional organizational format of marketing departments?

A)A company creates large teams, or even whole divisions, to serve large customers.
B)Market managers are responsible for developing marketing strategies and plans for their specific markets or customers and the company is organized around the needs of specific customer segments.
C)A product manager develops and implements a complete strategy and marketing program for a specific product or brand.
D)Sales and marketing people are assigned to specific countries, regions, and districts.
E)Different marketing activities are headed by specialists such as a sales manager, an advertising manager, a marketing research manager, or a customer-service manager.

Question 59

When viewing the market from a buyer's point of view,"convenience" corresponds to ________ in the four Ps according to the seller's point of view.

A)product
B)price
C)promotion
D)place
E)people

Question 60

Which of the following is a tool for monitoring strategic marketing performance?

A)a marketing plan
B)a marketing dashboard
C)BCG
D)a product differentiation
E)a value delivery network

Question 61

A company can offer greater customer value by either charging lower prices than competitors or offering more benefits to justify higher prices.

Question 62

In the BCG matrix,question marks are low-growth,low-share businesses and products that generate enough cash to maintain themselves but do not promise to be large sources of cash.

Question 63

"At America Online,we create customer connectivity,anytime,anywhere," is a product-oriented mission.

Question 64

An SBU can be a company division or a product line within a division,but not a single product or brand.

Question 65

Holiday Inn has divided the total customer market into smaller segments and selected the most promising segments.Deciding what position it wants to occupy in these segments is called targeting.

Question 66

The four Ps concept takes the seller's view of the market.

Question 67

In the marketing mix,place refers to activities that communicate the merits of the product and persuade target customers to buy it.

Question 68

In the four Ps of the marketing mix,promotion refers solely to advertising.

Question 69

The product development strategy involves offering modified or new products to new markets.

Question 70

Mission statements should be market-oriented and defined in terms of satisfying basic customer needs.

Question 71

Stars are high-growth,high-share businesses or products.

Question 72

A harvesting strategy involves selling off a low-performing SBU or phasing it out and using the resources elsewhere.

Question 73

The growth strategy of diversification involves offering modified or new products to current markets.

Question 74

Reliant Shoes has a low market share in a market poised for high growth.Reliant is considered to be a dog on the BCG matrix.

Question 75

In the marketing mix,product means the tangible goods the company offers to the target market,while promotions include the services offered.

Question 76

The strategic plan deals with a company's current businesses,while annual plans involve adapting the firm to take advantage of opportunities in the environment.

Question 77

TRX is a low-share business in a market that is set to grow significantly.TRX is considered a dog on the BCG matrix.

Question 78

"At Nike,we sell shoes" is a market-oriented business definition.

Question 79

Market development refers to making more sales without changing a company's original product.

Question 80

In SWOT analysis,strengths and weaknesses refer to a firm's external environment,while opportunities and threats refer to the internal environment.