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

Question 1

Which of the following is true with regard to strategic planning?

A) At the corporate level, the company starts the strategic planning process by determining what portfolio of businesses and products is best for the company.
B) A strategic plan deals with a company's short-term goals.
C) The focus of strategic planning is to define a game plan for long-run survival and growth.
D) The strategic plan is a statement of an organization's purpose.
E) Strategic planning involves identifying segments of consumers with identical preferences.

Answer 1

C

Question 2

Mission statements should be ________.

A) meaningful and specific yet motivating
B) technology oriented
C) written solely for public relations purposes
D) focused on increasing sales or profits
E) strictly product oriented

Answer 2

A

Question 3

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

Answer 3

E

Question 4

Mission statements should be defined in terms of ________.

A) the advantages a company's products provide
B) satisfying basic customer needs
C) the value a company's products provide
D) the profitability of a company's products
E) the variety they offer to a customer

Question 5

________ is the process of developing and maintaining a crucial fit between the organization's goals and capabilities and its changing marketing opportunities.

A) Benchmarking
B) SWOT analysis
C) Market segmentation
D) Strategic planning
E) Diversification

Question 6

A ________ documents an organization's purpose-what it wants to accomplish in the larger environment.

A) vision statement
B) mission statement
C) business portfolio
D) value proposition
E) product strategy

Question 7

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."

Question 8

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."

Question 9

A company's broad mission leads to ________.

A) increasing profits and more customers
B) increasing sales and decreasing costs
C) a higher share price
D) a hierarchy of objectives, including business objective and marketing objectives
E) increased market share and increasing profitability

Question 10

Which of the following companies has a product-oriented business definition?

A) A luxury hotel, whose business definition is: "We sell out-of-the-world experiences to our guests."
B) A real estate company, whose business definition is: "We sell dreams."
C) A cosmetic company, whose business definition is: "We offer hope and self-expression."
D) A shoe manufacturer, whose business definition is: "We manufacture affordable and long-lasting shoes for all."
E) A high-technology company, whose business definition is: "We sell inspirations."

Question 11

The purpose of strategic planning is to find ways in which your company can best use its strengths to take advantage of attractive opportunities in the environment.

Question 12

A company's mission statement provides the depth needed for all segments of the company to reach their goals.

Question 13

Which of the following is the first step in strategic planning?

A) setting short-term goals
B) developing the business portfolio
C) defining the organizational mission
D) formulating the key marketing strategies
E) identifying the organization's weaknesses and the threats it faces

Question 14

Companies that define their missions in terms of products or technologies are considered myopic primarily because ________.

A) products and technologies result in low returns on investment
B) consumer preferences with regard to products and technology are difficult to predict
C) consumer preferences for different product categories vary from time to time
D) products and technologies eventually become outdated
E) most consumers are not comfortable using sophisticated technology during the buying process

Question 15

Which of the following is NOT a step in the strategic planning process?

A) defining the company mission
B) setting company objectives and goals
C) designing the business portfolio
D) planning marketing and other functional strategies
E) evaluating members of the company's value chain

Question 16

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."

Question 17

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."

Question 18

Mission statements should ________ and be defined in terms of ________.

A) be technology oriented; meeting the self-actualization needs of customers
B) be product oriented; satisfying the esteem needs of customers
C) embody the company's short-term plans; current opportunities
D) be market oriented; satisfying basic customer needs
E) address sales and profits; the net return on investments

Question 19

A mission statement serves as a ________.

A) statement of the organization's net profits
B) plan for short-term sustainability
C) statement of the organization's purpose
D) statement of the organization's current liabilities
E) reward plan for the organization's highly skilled employees

Question 20

A company's broad mission leads it to develop all of the following EXCEPT ________.

A) budget objectives
B) business objectives
C) sales objectives
D) marketing objectives
E) customer engagement objectives

Question 21

Which of the following is NOT something a company must determine when analyzing its current business portfolio?

A) which businesses should receive more investment
B) which businesses should receive less investment
C) which businesses should receive no investment
D) which businesses should be sold or closed
E) which businesses shape the future portfolio

Question 22

Most standard portfolio analysis methods evaluate SBUs on the ________.

A) potential for niche or global marketing
B) degree of product differentiation
C) strength of the market or industry position
D) accessibility to rural markets
E) number of successful business acquisitions

Question 23

Which of the following is the first step of business portfolio planning?

A) shaping the future portfolio by developing strategies for growth and downsizing
B) determining which businesses should receive more, less, or no investment
C) identifying internal strengths and weaknesses
D) identifying future opportunities
E) determining short-term goals

Question 24

Which of the following best describes a strategic business unit?

A) the internal value chain of a company
B) the supply chain of a company
C) the key businesses that make up a company
D) the key channel intermediaries of a service company
E) the key competitors of a company

Question 25

During portfolio analysis, a company ________ after identifying the key businesses that make up the company.

A) formulates a short-term marketing plan
B) assesses the attractiveness of its various SBUs
C) assesses its strengths and weaknesses
D) performs a SWOT analysis
E) assesses the effectiveness of its various channel intermediaries

Question 26

Mission statements should be market oriented.

Question 27

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

Question 28

According to the Boston Consulting Group approach, ________ serves as a measure of company strength in the market.

A) relative market share
B) product development
C) market diversification
D) product attribute
E) market segmentation

Question 29

The major activity in strategic planning is ________, whereby management evaluates the products and businesses that make up the company.

A) SWOT analysis
B) benchmarking
C) business portfolio analysis
D) breakeven analysis
E) prospecting

Question 30

Why should mission statements be market oriented instead of product or technology oriented?

Question 31

The best business portfolio is the one that ________.

A) provides the greatest opportunity for increasing profits
B) best fits the company's strengths and weaknesses to opportunities in the environment
C) ensures that the company will realize increased share of market
D) allows the company to decrease its overall costs
E) entices customers to purchase even more products from the company

Question 32

How does strategic planning benefit companies?

Question 33

Define strategic planning. Discuss the steps involved.

Question 34

A clear mission statement acts as an "invisible hand" that guides people in the organization.

Question 35

"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.

Question 36

A company's mission could appropriately be stated as "making more sales or profits."

Question 37

According to the Boston Consulting Group approach, ________ provides a measure of market attractiveness.

A) product attribute
B) product design
C) market penetration
D) market growth rate
E) market segmentation

Question 38

The collection of businesses and products that make up a company is called its ________.

A) strategic business unit
B) supply chain
C) strategic plan
D) business portfolio
E) internal value chain

Question 39

A mission statement is a document embodying an organization's short-term goals.

Question 40

Which of the following is true of the BCG matrix approach?

A) It is inexpensive to implement.
B) It does not have any limitations.
C) It considers market growth rate to be a measure of market attractiveness.
D) It describes consumer motivations and needs.
E) It does not consider relative market share to be a measure of company strength in the market.

Question 41

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

Question 42

Making more sales to current customers without changing a firm's products is known as ________.

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

Question 43

By harvesting its SBU, a company would most likely be ________.

A) milking the SBU's short-term cash flow regardless of the long-term effect
B) selling the SBU or phasing it out and using the resources elsewhere
C) investing just enough to hold the SBU's current market share
D) investing more in the business unit to build its share
E) diversifying the company's product line

Question 44

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

Question 45

Within a company, who is most likely to perform strategic planning?

A) the president and vice presidents
B) the accounting and finance departments
C) the marketing and sales departments
D) cross-functional teams of divisional managers close to their markets
E) the manufacturing and production departments

Question 46

Modern strategic planning ________.

A) exclusively consists of a company's short-term goals
B) is decentralized
C) does not involve cross-functional teams
D) does not take the overall mission of the company into consideration
E) is highly centralized

Question 47

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

Question 48

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

Question 49

The BCG matrix approach is problematic in that it ________.

A) focuses on planning for the future at the cost of ignoring the present
B) focuses solely on current businesses and provides little scope for future planning
C) tends to undermine the importance of market growth rate as a measure of market attractiveness
D) tends to undermine the importance of relative market share as a measure of company strength in the market
E) fails to classify SBUs

Question 50

Which of the following is true with regard to cash cows?

A) They are high-growth, high-share businesses or products.
B) They can be used to help finance the company's question marks and stars.
C) They require significant cash to maintain market share.
D) They are low-share businesses and products.
E) They do not promise to be large sources of cash.

Question 51

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

Question 52

Which of the following is true with regard to the product/expansion grid?

A) It classifies SBUs into four distinct categories.
B) It is a useful device for identifying growth opportunities.
C) It helps companies analyze their internal strengths and weaknesses.
D) It functions on the premise that firms should downsize to regain market share.
E) It is a useful device for segregating customers into distinct categories.

Question 53

Which of the following is a portfolio-planning tool for identifying company growth opportunities through market penetration, market development, product development, or diversification?

A) BCG matrix
B) analysis of variance
C) product/market expansion grid
D) Harris matrix
E) SWOT analysis

Question 54

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

Question 55

________ are a type of SBU that often require heavy investments to finance their rapid growth.

A) Cash cows
B) Question marks
C) Stars
D) Dogs
E) Bears

Question 56

________ are low-growth, high-share businesses/products that need less investment to hold their market share.

A) Stars
B) Cash cows
C) Question marks
D) Dogs
E) Bears

Question 57

The key businesses of Kimberley and Price consist of a division that produces and sells breakfast cereals and another that manufactures gardening tools. Each of these businesses is called a ________.

A) market segment
B) strategic business unit
C) question mark
D) prospect
E) product portfolio

Question 58

________ are low-share business units in high-growth markets that require a lot of cash to hold their share.

A) Stars
B) Dogs
C) Question marks
D) Cash cows
E) Bears

Question 59

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

Question 60

A company can ________ an SBU by selling it or phasing it out and using the resources elsewhere.

A) divest
B) promote
C) expand
D) harvest
E) hold

Question 61

Refer to the scenario below to answer the following question(s).
Fun-Spot Fun Park began as a small amusement park in 1985. With nothing more than a merry-go-round, a slide, pony rides, and an ice cream stand, Fun-Spot grew into a popular family attraction with 20 rides, a restaurant, and an outdoor performing arts theater.
"My wife, Gail, and I didn't know what we were getting into," commented Ron Hart, the owner. "We just knew that weekenders coming to the lakes in our rural area represented an untapped market."
Today, thousands of visitors flock to Fun-Spot: families, children of all ages, and even senior citizens who enjoy strolling through the gardens and the arbors. "There's something here for everyone," Gail Hart said with a smile. "Dozens of companies hold annual company picnics here. We have welcomed class field trips. And we even had one wedding here at the park!"
"Here's the funny thing," Ron chimed in. "We really don't know why we've been so successful. There is nothing else like Fun-Spot Fun Park in the area. We were just lucky." "I think it's the ambience of the park that has brought so many visitors," Gail added. "We provide a 'total package' of entertainment. Plus, we try to change our rides and various attractions from time to time for variety."
Ron and Gail Hart admitted that making every visitor happy is a priority. "That has always been our philosophy," they said. "Like the park's motto at the entrance reads, 'We're here to make you happy!' And we've always been able to deliver on that because we've never allowed ourselves to grow too big too quickly."
Ron and Gail, owners of Fun-Spot, strive to provide new offerings and entertainment options for their visitors. This type of strategy can be best described as ________.

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

Question 62

What are stars according to the BCG growth-share matrix?

Question 63

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

Question 64

What type of strategy should a company use to manage its cash cows?

Question 65

The major activity in strategic planning is business portfolio analysis, whereby management evaluates the products and businesses that make up the company.

Question 66

Define market penetration.

Question 67

Cleats, Unlimited developed a new style of soccer shoe. This is an example of ________.

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

Question 68

Refer to the scenario below to answer the following question(s).
Fun-Spot Fun Park began as a small amusement park in 1985. With nothing more than a merry-go-round, a slide, pony rides, and an ice cream stand, Fun-Spot grew into a popular family attraction with 20 rides, a restaurant, and an outdoor performing arts theater.
"My wife, Gail, and I didn't know what we were getting into," commented Ron Hart, the owner. "We just knew that weekenders coming to the lakes in our rural area represented an untapped market."
Today, thousands of visitors flock to Fun-Spot: families, children of all ages, and even senior citizens who enjoy strolling through the gardens and the arbors. "There's something here for everyone," Gail Hart said with a smile. "Dozens of companies hold annual company picnics here. We have welcomed class field trips. And we even had one wedding here at the park!"
"Here's the funny thing," Ron chimed in. "We really don't know why we've been so successful. There is nothing else like Fun-Spot Fun Park in the area. We were just lucky." "I think it's the ambience of the park that has brought so many visitors," Gail added. "We provide a 'total package' of entertainment. Plus, we try to change our rides and various attractions from time to time for variety."
Ron and Gail Hart admitted that making every visitor happy is a priority. "That has always been our philosophy," they said. "Like the park's motto at the entrance reads, 'We're here to make you happy!' And we've always been able to deliver on that because we've never allowed ourselves to grow too big too quickly."
Fun-Spot Fun Park represents a high-growth, high-share business. According to the BCG matrix, it can be classified as a ________.

A) star
B) question mark
C) bear
D) cat
E) dog

Question 69

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

Question 70

Companies may want to downsize their business portfolios for all but which of the following reasons?

A) The firm may have grown too fast.
B) The firm may have entered areas where it lacks experience.
C) The customers may have purchased all they need.
D) The market environment might change.
E) The products might simply age.

Question 71

Market development involves company growth by identifying and developing new market segments for current company products.

Question 72

On the BCG matrix, "question marks" are high-growth, high-share businesses or products.

Question 73

Refer to the scenario below to answer the following question(s).
Fun-Spot Fun Park began as a small amusement park in 1985. With nothing more than a merry-go-round, a slide, pony rides, and an ice cream stand, Fun-Spot grew into a popular family attraction with 20 rides, a restaurant, and an outdoor performing arts theater.
"My wife, Gail, and I didn't know what we were getting into," commented Ron Hart, the owner. "We just knew that weekenders coming to the lakes in our rural area represented an untapped market."
Today, thousands of visitors flock to Fun-Spot: families, children of all ages, and even senior citizens who enjoy strolling through the gardens and the arbors. "There's something here for everyone," Gail Hart said with a smile. "Dozens of companies hold annual company picnics here. We have welcomed class field trips. And we even had one wedding here at the park!"
"Here's the funny thing," Ron chimed in. "We really don't know why we've been so successful. There is nothing else like Fun-Spot Fun Park in the area. We were just lucky." "I think it's the ambience of the park that has brought so many visitors," Gail added. "We provide a 'total package' of entertainment. Plus, we try to change our rides and various attractions from time to time for variety."
Ron and Gail Hart admitted that making every visitor happy is a priority. "That has always been our philosophy," they said. "Like the park's motto at the entrance reads, 'We're here to make you happy!' And we've always been able to deliver on that because we've never allowed ourselves to grow too big too quickly."
Fun-Spot's mission is ________.

A) product oriented
B) technology oriented
C) market oriented
D) design oriented
E) narrowly focused on profits

Question 74

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

Question 75

Company growth through diversification involves offering modified or new products to the company's current markets.

Question 76

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

Question 77

Market penetration involves offering modified or new products to current markets.

Question 78

Refer to the scenario below to answer the following question(s).
Fun-Spot Fun Park began as a small amusement park in 1985. With nothing more than a merry-go-round, a slide, pony rides, and an ice cream stand, Fun-Spot grew into a popular family attraction with 20 rides, a restaurant, and an outdoor performing arts theater.
"My wife, Gail, and I didn't know what we were getting into," commented Ron Hart, the owner. "We just knew that weekenders coming to the lakes in our rural area represented an untapped market."
Today, thousands of visitors flock to Fun-Spot: families, children of all ages, and even senior citizens who enjoy strolling through the gardens and the arbors. "There's something here for everyone," Gail Hart said with a smile. "Dozens of companies hold annual company picnics here. We have welcomed class field trips. And we even had one wedding here at the park!"
"Here's the funny thing," Ron chimed in. "We really don't know why we've been so successful. There is nothing else like Fun-Spot Fun Park in the area. We were just lucky." "I think it's the ambience of the park that has brought so many visitors," Gail added. "We provide a 'total package' of entertainment. Plus, we try to change our rides and various attractions from time to time for variety."
Ron and Gail Hart admitted that making every visitor happy is a priority. "That has always been our philosophy," they said. "Like the park's motto at the entrance reads, 'We're here to make you happy!' And we've always been able to deliver on that because we've never allowed ourselves to grow too big too quickly."
Ron and Gail plan to lower Fun-Spot's prices in an effort to encourage customers to stay longer, visit more often, and spend more money during each visit. What type of strategy are Ron and Gail planning?

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

Question 79

What is a strategic business unit (SBU)?

Question 80

The major activity in strategic planning is product innovation.