Question 1

Market niching is profitable because the company ________.

Accepted Answer

A)  copies or improves on the leader's products and programs, usually with much less investment 
B)  bears the cost of developing new products and markets, expanding distribution, and educating the market 
C)  knows the needs of the target customer segment better than other firms that casually attempt to sell to the same segment 
D)  either keeps its manufacturing costs and prices low or its product quality and services high 
E)  can achieve economies of scale much faster by selling the same product to the global market

Question 2

Although it might seem that the market leader has the most going for it, challengers often have what some strategists call a(n) ________. The challenger observes what has made the leader successful and improves upon it.

Accepted Answer

A)  "marketing myopia" 
B)  "second mover advantage" 
C)  "absolute advantage" 
D)  "blue ocean strategy" 
E)  "red ocean strategy"

Question 3

Some companies successfully pursue more than one of the three value disciplines at the same time. For example, FedEx excels at operational excellence as well as customer intimacy. However, more companies focus on excelling at a single value discipline while ________ the other two.

Accepted Answer

A)  choosing a second one to also focus on 
B)  meeting industry standards on 
C)  ignoring 
D)  achieving minimal goals on 
E)  developing plans to improve on

Question 4

Rather than challenging head on, a challenger can make a(n) ________ attack on the competitor's weaknesses or on gaps in the competitor's market coverage.

Accepted Answer

A)  bypass 
B)  frontal 
C)  indirect 
D)  guerrilla 
E)  preemptive

Question 5

Which of the following are market challenger strategies?

Accepted Answer

A)  expand total market and protect market share 
B)  expand market share and follow closely 
C)  full frontal attack and indirect attack 
D)  follow closely and follow at a distance 
E)  multiple niching and quality service

Question 6

American Express will do almost anything to build long-term customer loyalty and to capture customer lifetime value. Which of the following competitive marketing strategies is being pursued by American Express?

Accepted Answer

A)  consumer capitalism 
B)  customer equity 
C)  product differentiation 
D)  product leadership 
E)  customer intimacy

Question 7

________ involves first identifying and assessing competitors and then selecting which competitors to attack or avoid.

Accepted Answer

A)  Competitor analysis 
B)  Self-competition 
C)  Blue ocean strategy 
D)  Quantitative analysis 
E)  Perfect competition

Question 8

A runner-up firm that wants to hold its share in an industry without rocking the boat is a ________.

Accepted Answer

A)  market follower 
B)  market maven 
C)  market challenger 
D)  market nicher 
E)  market leader

Question 9

Competitors may serve less-attractive segments or lead to more product differentiation.

Accepted Answer

A) True 
 B)False

Question 10

Refer to the scenario below to answer the following question(s).
Essential-Beauty is a rapidly growing firm that manufactures women's makeup, perfumes, and nail-care products. The company has established itself as a high-end cosmetic product brand available at most national drug stores. In the past, almost all of the advertising for Essential-Beauty has been in women's fashion magazines.
The firm is now launching a new line of skin care products, ranging from facial cleansers to body lotion. These products are designed to be marketed to a broader audience, so the marketing team is exploring the effectiveness of different promotional mixes.
-Essential-Beauty e-mailed a survey to a group of its most frequent, loyal customers. The survey asked what makeup and skin care characteristics were most important to them. The company's marketing staff then ranked the performance of Essential-Beauty products in each of these categories. Essentials was conducting a(n) ________.

Accepted Answer

A)  customer lifetime value survey 
B)  entrepreneurial marketing strategy 
C)  intrepreneurial marketing strategy 
D)  customer value proposition 
E)  customer value analysis

Question 11

Samsung and Apple actively generate new ideas, relentlessly pursue new solutions, and quickly work to get new products to market. They serve customers who want state-of-the-art products and services, regardless of the costs in terms of price or inconvenience. Which of the following value disciplines is illustrated from this example?

Accepted Answer

A)  operational excellence 
B)  customer intimacy 
C)  product leadership 
D)  product activation 
E)  product binning

Question 12

Which of the following statements is true of the approaches to marketing strategy?

Accepted Answer

A)  Intrepreneurial marketing applies to companies that sometimes lose their marketing creativity and passion that they had at the start. 
B)  As small companies achieve success, they inevitably move away from more-formulated marketing. 
C)  Within a company, a single strategy exclusively applies to all different businesses and products. 
D)  Formulated marketing seldom involves developing formal marketing strategies and adhering to them closely. 
E)  Formulated marketing encourages more marketing initiative and "intrepreneurship" at the local level.

Question 13

A company can become so ________ centered that it loses its even more important focus on maintaining profitable ________ relationships.

Accepted Answer

A)  customer; competitor 
B)  competitor; customer 
C)  market; customer 
D)  market; competitor 
E)  competitor; product

Question 14

A market nicher can most likely specialize along all of the following lines EXCEPT ________.

Accepted Answer

A)  specific end users 
B)  unique products 
C)  customized services 
D)  quality-price 
E)  mass marketing

Question 15

Although competition is most intense within a strategic group, explain why there is also rivalry among groups. Give examples.

Accepted Answer

The answer of Although competition is most intense within a...

Question 16

A company's objectives indicate its satisfaction with its current situation and ________.

Accepted Answer

A)  its strength with its current management 
B)  in what areas it intends to develop further 
C)  how strong it is financially 
D)  how it might react to different competitive actions 
E)  its areas of concern, if any

Question 17

Explain how a market follower can gain advantage from a market leader.

Accepted Answer

The answer of Explain how a market follower can gain...

Question 18

Tomorrow's leading companies will succeed by seeking out unoccupied positions in uncontested market spaces. Such strategic moves, termed ________, create powerful leaps in value for both the firm and its buyers, creating new demand for new products.

Accepted Answer

A)  customer lifetime value 
B)  customer equity 
C)  value innovation 
D)  market segmentation 
E)  customer intimacy

Question 19

Discuss the steps in analyzing competitors.

Accepted Answer

The answer of Discuss the steps in analyzing competitors....

Question 20

Sears and Holiday Inn encountered difficult times because they did not stand out as the lowest in cost, highest in perceived value, or best in service of their primary target market segment. Both companies are ________.

Accepted Answer

A)  niches 
B)  jack-of-all-trades 
C)  middle-of the roaders 
D)  red oceans 
E)  laggards

Exam 18: Creating Competitive Advantage