Deck 2: Strategic Planning for Competitive Advantage

Question 1

When the Walt Disney Company opened Disneyland Paris for the French market,it was an example of market penetration.

Answer 1

False
Market penetration is the strategy of selling more to the existing customers.This is an example of a market development strategy,which is attracting new customers to existing products.

Question 2

A portfolio model is a tool for allocating resources among products or strategic business units on the basis of relative market share and degree of innovation.

Answer 2

False
A portfolio model is based on relative market share and market growth rate.

Question 3

In theory,an SBU should have its own resources for handling basic business functions.

Answer 3

True

Question 4

A diversification strategy entails increasing sales by introducing new products into new markets.

Question 5

When a florist shop begins to sell burial caskets to its customers,it is engaged in product development.

Question 6

A production costs analysis could be a part of a company's SWOT analysis.

Question 7

A competitive advantage is the set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition.

Question 8

The marketing plan is a written document that acts as a guidebook of marketing activities for a marketing manager.

Question 9

The harvest strategy is appropriate for all SBUs except dogs.

Question 10

Niche competitive advantages are difficult to develop and consequently are quite rare.

Question 11

Environmental scanning entails the collection and interpretation of information about factors in the external environment that may affect the future of the organization or the implementation of the marketing plan.

Question 12

In the portfolio mix,notebook computers would be an example of a star.

Question 13

To be useful,marketing objectives should be realistic,measurable,time specific,and based on sales.

Question 14

The Home Depot's purchase of Hughes Supply Company allows it to better meet the needs of its current business customers.This is an example of product development.

Question 15

In the General Electric model,SBUs that have low overall attractiveness should be avoided if the organization is not already serving them.

Question 16

A market penetration strategy entails the creation of new products for current customers.

Question 17

A firm's mission statement should answer the question,"What products do we produce best?"

Question 18

As marketers gain more experience in marketing a product,costs tend to decrease,which is an example of the maturity effect.

Question 19

The manufacturer of Macho brand martial arts products was implementing a strategic plan when it sponsored a local karate tournament for teenagers.

Question 20

Developing a cost competitive advantage can enable a firm to deliver superior customer value.

Question 21

Strategic plans require:

A) long-term resource commitments
B) a change in organizational structure
C) the addition of new personnel
D) new product development
E) changes in prices

Question 22

The development of a target market strategy begins with a marketing audit.

Question 23

Until spun off in 2007,Kraft was part of Altria Group,Inc.Kraft had its own management team,mission statement,and target markets different from Altria Group,Inc.Kraft was a _____ of Altria Group,Inc.

A) joint venture
B) diversified division
C) heterogeneous element
D) strategic alliance
E) strategic business unit

Question 24

The implementation process can be described as simply "doing what you said you were going to do."

Question 25

When properly created,an SBU has all of the following characteristics EXCEPT:

A) plans independent of the other SBUs in the total organization
B) control over its own resources
C) a distinct mission
D) no competitors
E) a specific target market

Question 26

With hospitals nationwide facing budget cuts and slimmer profit margins,Dekalb County's Medical Center decided to cash in on one of the most consistently profitable services-delivering babies.It initiated a three-year project to build a $55 million state-of-the-art women's center with 18 labor and delivery suites.When the hospital decided to commit its resources to obstetrics,it was engaging in:

A) benchmarking
B) alternative problem solving
C) strategic planning
D) portfolio evaluation
E) tactical control

Question 27

Typically,the development of the marketing mix starts with determining the promotion for a product.

Question 28

The most critical element for successful strategic planning is top management's support and participation.

Question 29

Since gas prices have soared and consumers have cut back on their spending on new trucks and SUVs Ford Motor Corporation is transforming several of its plants to create small cars.Ford has engaged in:

A) benchmarking
B) tactical resource realignment
C) alternative selection
D) portfolio evaluation
E) strategic planning

Question 30

Evaluation entails gauging the extent to which marketing objectives have been achieved during the specified time period.

Question 31

Marketing strategy involves the activities of selecting and describing one or more target markets and developing and maintaining a marketing mix that will produce mutually satisfying exchanges with target markets.

Question 32

A marketing audit helps management allocate marketing resources efficiently.

Question 33

_____ is the managerial process of creating and maintaining a fit between the organization's objectives and resources and the evolving market opportunities.

A) Tactical management
B) The market audit
C) Functional planning
D) Environmental scanning
E) Strategic planning

Question 34

Yildiz Holding of Turkey purchased Godiva Chocolates from Campbell's Soup Company.Campbell's sold one of its:

A) strategic business units (SBUs)
B) strategic alliances
C) action programs
D) transactional units
E) synergistic divisions

Question 35

The four Ps of the marketing mix are product,planning,promotion,and price.

Question 36

General Electric has a financing business called GE Capital,which has its own mission,products,services,and strategic plans separate from the parent organization.GE Capital is an example of a(n):

A) organizational level
B) SWOT
C) secure business unit
D) diversified division
E) strategic business unit

Question 37

Which of the following is a type of strategic alternative that tries to increase market share among existing customers?

A) Vertical integration
B) Product penetration
C) Divestment
D) Horizontal integration
E) Market penetration

Question 38

A subgroup of a single business or a collection of related businesses within the larger organization is called a(n):

A) conglomerate
B) joint venture
C) strategic business unit (SBU)
D) oligarchy
E) strategic alliance

Question 39

The company's marketing objective is to increase sales next year.This is an example of a well-stated objective.

Question 40

Strategic planning is most effective when managers view it as an annual exercise.

Question 41

The Hallmark Company was inspired by the popularity of Jan Karon's best-selling novels about Mitford,a fictional town in the mountains of North Carolina,to develop a new line of products for Hallmark Gold Crown Stores nationwide.Hallmark created hundreds of Mitford-inspired products that authentically bring "the little town with the big heart" into tangible reality.The products include greeting cards,partyware and gift wrap,mugs,and puzzles for Hallmark's existing customers.Hallmark used a _____ strategy.

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

Question 42

_____ is a marketing strategy that creates new products for present markets.

A) Product penetration
B) Market penetration
C) Product development
D) Market development
E) Diversification

Question 43

_____ is a strategy of increasing market share for present products in existing markets.

A) Market penetration
B) Product development
C) Market development
D) Diversification
E) Product penetration

Question 44

_____ is the strategy of increasing sales by introducing new products into new markets.

A) Product penetration
B) Product development
C) Market penetration
D) Market development
E) Diversification

Question 45

Yard Whimzees,a Statesboro,Georgia sign business,began by making wooden signs for residential use to announce births,anniversaries,and such.The company then turned to the business market by making signs for businesses.Creating signs for a new market is an implementation of a _____ strategy.

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

Question 46

Years ago,Arm & Hammer baking soda convinced millions of homemakers that their product could be effective in keeping refrigerators smelling fresh.After years of languishing sales,this campaign led to a huge increase in sales of a simple,basic product.This is a classic example of a _____ strategy.

A) market development
B) product development
C) market penetration
D) product penetration
E) divestment

Question 47

_____ is a strategy that attempts to attract new customers to existing products.

A) Product development
B) Market development
C) Market penetration
D) Product penetration
E) Diversification

Question 48

Pure Digital Technologies created the Flip,a digital camera that is priced around $150.It filled a gap between expensive digital cameras and webcams.The Flip plugs straight into your computer and the video can easily be viewed and shared instantly.Creating a new product for a new market is called _____.

A) divestment
B) segment development
C) target marketing
D) diversification
E) directed growth

Question 49

Kraft introduced Philadelphia Ready-To-Eat Cheesecake Filling for those who do not have time to make cheesecake in the traditional manner.This is an example of a _____ strategy.

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

Question 50

Kraft foods created a magazine full of recipes and coupons for customers as well as a Web site with product and recipe information.The goal was to get current customers to purchase more of Kraft's products.These activities are representative of a _____ strategy.

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

Question 51

Canon began as a camera-making company but has since become a company that produces a wide range of office equipment in addition to cameras.Canon's managers evidently believe in growth through:

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

Question 52

The company that manufactures Molson beer,which is typically consumed by males,launched an alcoholic lemonade beverage to attract more females.This launch of a new product to attract a new market for Molson's products is an illustration of a _____ strategy.

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

Question 53

Orange growers in Florida have lost millions of dollars due to hurricanes.As a result,some growers have decided to bulldoze their orange groves and put in freshwater lakes for raising shrimp,a product that has a strong popularity and is more weather-resistant.Former orange growers who are now raising shrimp are pursuing a _____ strategy.

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

Question 54

The _____ is a tool for allocating resources among products or strategic business units on the basis of relative market share and market growth rate.

A) market audit
B) portfolio model
C) experience matrix
D) market development analysis
E) market opportunity analysis

Question 55

In order to expand its sales into the U.S.market,BRL,an Australia-based winemaker,agreed to a merger with a U.S.-based wine distribution company.According to Ansoff's strategic opportunity matrix,BRL would be implementing a _____ strategy.

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

Question 56

When McDonald's introduced yogurt parfaits,entrée salads,and fruit to offer their current customers more healthy options,the company was engaging in a _____ strategy.

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

Question 57

All of the following are strategic alternatives that match products with markets EXCEPT:

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

Question 58

The marketing of organic cotton tees for Life is good's existing customers would be an example of a _____ strategy.

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

Question 59

LVMH,a maker of luxury-goods,has expanded its products offerings into China,Russia,India,and the Middle East.This exemplifies a _____ strategy.

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

Question 60

Market penetration occurs when:

A) a supermarket adds a new store
B) a U.S.-based company begins to sell its products in China
C) Motown records sells DVDs to Wal-Mart
D) Yoplait yogurt sends coupons to its existing customers
E) 3M distributes breathe-right nasal strips in Europe

Question 61

Earl is starting a new bank.Before their opening day Earl had a meeting with all employees.He discussed their mission,defined objectives for the bank for the coming years and shared who their target market is.He talked about their product offerings and where their future branches would be located.Earl is sharing the bank's:

A) reengineering
B) hierarchical restructuring
C) financial analysis
D) marketing plan
E) strategic contingency planning

Question 62

A written document that acts as a guidebook of marketing activities for the marketing manager is known as the _____.

A) strategy document
B) marketing plan
C) vision statement
D) mission statement
E) strategic plan

Question 63

Tide laundry detergent is the market leader,but overall industry growth is low in this market.Tide would be classified as a _____ in a portfolio model.

A) star
B) cash cow
C) problem child
D) question mark
E) dog

Question 64

All of the following are basic strategies resulting from classifying the company's SBUs EXCEPT:

A) harvest
B) build
C) hold
D) divest
E) milk

Question 65

In the portfolio model,a business unit that has low growth potential and a small market share is called a(n):

A) widow
B) problem child
C) cash cow
D) dog
E) bust

Question 66

Which of the following represents a business unit that shows rapid growth but poor profit margins?

A) Star
B) Cash cow
C) Problem child
D) Loss leader
E) Dog

Question 67

Marketing plans should be written to do all of the following EXCEPT:

A) compare actual and expected performance
B) provide clearly stated activities
C) create common goals for employees to work toward
D) allow managers to enter the marketplace with an awareness of possibilities and problems
E) control the elements of the external marketing environment

Question 68

Which of the following category in the portfolio model is a market leader and growing fast?

A) Star
B) Meteor
C) Cash cow
D) Shiner
E) Top dog

Question 69

In the mid-1980s,the market for teenage clothes was growing quickly,but jeans were out of fashion.Levi's re-launched their jeans,led by advertising for 501s,which had never been a fashionable jean style.Within a few months,sales factors had increased dramatically,turning a ______ into a star.

A) widow
B) cash cow
C) problem child
D) loss leader
E) dog

Question 70

A business unit that usually generates more than it needs to maintain its market share is called a(n)_____ in a portfolio model.

A) star
B) cash cow
C) problem child
D) dog
E) independent

Question 71

Which of the following strategies would be most appropriate for a dog?

A) harvesting
B) diversification
C) divesting
D) holding
E) building

Question 72

A statement of the firm's business based on a careful analysis of benefits sought by present and potential customers and an analysis of existing and anticipated environmental conditions is known as a(n):

A) business audit
B) marketing plan
C) mission statement
D) environmental focus
E) portfolio model

Question 73

If market share is maintained,stars are likely to grow into:

A) weak sisters
B) problem children
C) cash cows
D) top dogs
E) constellations

Question 74

Before Heinz sold its 9-Lives brand cat food unit,the company identified the product as having a low market share in a high-growth market.The portfolio model would classify 9-Lives as a(n):

A) star
B) exclamation point
C) problem child
D) cash cow
E) widow

Question 75

All of the following are categories used in the Boston Consulting Group's portfolio model EXCEPT:

A) cash cows
B) stars
C) problem children
D) meat eaters
E) dogs

Question 76

All of the following are elements of the marketing plan EXCEPT:

A) business mission statement
B) situation analysis
C) target market strategy
D) marketing mix
E) portfolio analysis

Question 77

The _____ answers the question,"What business are we in?"

A) mission statement
B) financial statement
C) situation analysis
D) market strategy
E) strategic plan

Question 78

Russell Athletic,which is part of Berkshire Hathaway,Inc. ,is a market leader in sports apparel,an industry that is growing rapidly.Russell Athletic is an example of a(n)_____ according to the portfolio model.

A) star
B) question mark
C) problem child
D) exclamation point
E) widow

Question 79

John R.Harland Company is best known for printing checks.Its Financial Solutions division develops software for mortgage companies,which is a growing industry.This division is currently not producing at the desired level of profitability,but Harland plans to turn the division into a success by acquiring other companies that develop similar software.Harland would be engaging in a _____ strategy.

A) harvesting
B) diversification
C) divesting
D) holding
E) building

Question 80

The annual report of Albertson's grocery has the following statement: "Guided by relentless focus on our five imperatives,we will constantly strive to implement the critical initiatives required to achieve our vision.In doing this,we will deliver operational excellence in every corner of the Company and meet or exceed our commitments to the many constituencies we serve.All of our long-term strategies and short-term actions will be molded by a set of core values that are shared by each and every associate." This statement is an example of Albertson's:

A) marketing mix strategy
B) quantifiable goal
C) mission statement
D) statement of economic potential
E) market segmentation strategy