Deck 11: Dealing with Competition

Question 1

An example of a strategic group in the appliance industry would be one where ________.

A) there is a large franchised dealer system
B) a common promotional theme is used
C) competitors have broad lines, medium manufacturing costs, low service responsibility, and low prices
D) multinational operations are mandated
E) there is a value orientation rather than a cost orientation

Answer 1

C

Question 2

Once a company has identified its main competitors and their strategies,it must next ask: ________

A) What are the competitors' objectives
B) What are the competitive brand attributes
C) What are the competitive promotion schemes
D) What is the attrition rate in the market
E) What are the subtle market entrance requirements

Answer 2

A

Question 3

________ is the percentage of customers who named the competitor in responding to the statement,"Name the company from which you would prefer to buy the product."

A) Share of market
B) Share of mind
C) Share of heart
D) Share of competitive space
E) Share of psychological field

Answer 3

C

Question 4

A firm that is willing to maintain its market share and not rock the boat is known as a ________.

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

Question 5

________ competitors try to buy market share rather than earn it; take large risks; invest in overcapacity; and upset industrial equilibrium.

A) "Bad"
B) "Good"
C) Distant
D) Close
E) Strong

Question 6

Most companies aim their competitive shots at ________ competitors,because this requires fewer resources per share point gained.

A) strong
B) weak
C) distant
D) "good"
E) unacknowledged

Question 7

Wal-Mart is perhaps one of the best illustrations of the threat of ________ found in Porter's model.

A) intense segment rivalry
B) new entrants
C) substitute products
D) buyers' growing bargaining power
E) suppliers' growing bargaining power

Question 8

When entry and exit barriers are high,________.

A) profit potential is high, but firms face more risk because poorer-performing firms stay in and fight it out
B) firms easily enter and leave the industry, and returns are stable and low
C) few new firms can enter the industry, and poorly performing firms can easily exit
D) firms enter during good times but find it hard to leave during bad times, resulting in chronic overcapacity and depressed earnings for all
E) none of the above

Question 9

Using the market approach,________ are companies that satisfy the same customer need.

A) partners
B) competitors
C) entrepreneurs
D) innovators
E) followers

Question 10

The ________ in a given marketplace has the largest market share in the relevant product market and usually leads other firms in price changes,new-product introductions,distribution coverage,and promotional intensity.

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

Question 11

In selecting customers,a company should ________ those who are vulnerable and not valuable.

A) make every effort to retain
B) focus on maintaining margins on
C) encourage the departure of
D) try to improve the vulnerability of
E) try to improve the value of

Question 12

A competitor's share of industry sales is known as the firm's ________.

A) share of market
B) share of mind
C) share of heart
D) share of competitive space
E) share of psychological field

Question 13

________ is the art of learning from companies that perform certain tasks better than other companies.

A) Competition
B) Market share
C) Value delivery
D) Industry definition
E) Benchmarking

Question 14

Michael Porter has identified five forces that determine the intrinsic long-run attractiveness of a market or market segment.Which of the following would NOT be among Porter's five forces

A) Industry competitors
B) Technological partners
C) Substitutes
D) Buyers
E) Potential entrants

Question 15

The aim of benchmarking is to copy or improve on ________ either within an industry or across industries.

A) profitability
B) manufacturing
C) ideation
D) aggressiveness
E) "best practices"

Question 16

A segment is unattractive if the company's suppliers are able to raise prices or reduce quantity supplied.Which of the following is the best illustration of the threat of suppliers' growing bargaining power

A) Wal-Mart has almost no competitors in its marketspace.
B) Oil companies must purchase a significant amount of their product from OPEC.
C) McDonald's is the largest fast-food franchise and is still growing.
D) The U.S. Post Office has merged package operations with FedEx.
E) Sears unsuccessfully attempted to compete with Wal-Mart and Kmart.

Question 17

In general,a company should monitor the following variables when analyzing competitors: ________,share of heart,and share of market.

A) share of demand
B) share of profits
C) share of promotion
D) share of universe
E) share of mind

Question 18

A group of firms following the same strategy in a given target market is called a(n)________.

A) cartel
B) cabal
C) cooperative
D) informal alliance
E) strategic group

Question 19

A segment is unattractive when there are actual or potential ________ for the product.

A) contenders
B) competitors
C) substitutes
D) unclear demand
E) profit fluctuation

Question 20

A(n)________ is a group of firms that offer a product or class of products that are close substitutes for one another.

A) industry
B) cartel
C) cooperative
D) monopoly
E) demand field

Question 21

Market broadening and market diversification are likely tactics employed in which of the following market leader defensive strategies

A) Position defense
B) Flank defense
C) Preemptive defense
D) Counteroffensive defense
E) Mobile defense

Question 22

After FedEx watched UPS successfully invade its airborne delivery system,FedEx invested heavily in ground delivery service through a series of acquisitions to challenge UPS on its home turf.This is an example of a ________.

A) position defense
B) flank defense
C) counteroffensive defense
D) contraction defense
E) mobile defense

Question 23

The "best defense is a good offense" would be a policy under which of the following market leader defensive strategies

A) Position defense
B) Flank defense
C) Contraction defense
D) Preemptive defense
E) Lateral defense

Question 24

Sony is an unusual market leader.It gives its customers new products that they have never even asked for (e.g.,Walkmans,VCRs,video cameras,CDs).This makes Sony a(n)________ firm.

A) market-driven
B) market-driving
C) operations-driven
D) vision-driven
E) virtually-driven

Question 25

A marketing manager has planned a strategy that will require the organization to erect outposts to protect its weak front-running brands.In this ________ defense,the outposts will be central to the organization's new competitive strategy.

A) position
B) flank
C) preemptive
D) counteroffensive
E) mobile

Question 26

Being a market leader is often a difficult position to maintain and defend.The firm can try to increase its market share in the face of constant market size,protect its current market share through good defensive and offensive actions,or ________.

A) be a cost leader
B) find new, innovative technologies on a monthly basis
C) strive to win promotional awards
D) find ways to expand total market demand
E) pursue markets others do not want

Question 27

Pushing for higher market share is less justified when ________.

A) there are obvious scale economies
B) attractive market segments exist
C) buyers want a single source of supply
D) exit barriers are low
E) there are few scale or experience economies

Question 28

One of the market leader strategies for expanding the total market is to focus on more usage.Two avenues are open for doing this: increasing the frequency of consumption or ________.

A) increasing adherence to everyday low pricing
B) decreasing the number of product returns
C) increasing the level or quantity of consumption
D) increasing the level of promotional expenditures relative to market share percentage
E) decreasing sales-related expenses

Question 29

________ become market leaders through superior value delivery of unmet-and maybe even unknown-consumer needs.

A) Creative marketers
B) Anticipative marketers
C) Responsive marketers
D) Market-driving firms
E) Reactive marketers

Question 30

One approach to ________ is to identify completely new and different applications for the product.For example,food product companies have long advertised recipes that use their branded products in entirely different ways.

A) amount of consumption
B) level of consumption
C) dedication to consumption
D) awareness consumption
E) frequency of consumption

Question 31

As a marketing manager,you have decided to pursue new customers with your established products.Specifically,the new customers that you want are those who might use the product but do not at present.Which of the following strategies is recommended to pursue such a customer market

A) Market-penetration strategy
B) New-market segment strategy
C) Geographical-expansion strategy
D) Needs-assessment strategy
E) Consolidation strategy

Question 32

Because the cost of buying higher market share may far exceed its revenue value,a company should consider four factors before pursuing increased market share.These include all of the following EXCEPT ________.

A) the possibility of provoking antitrust action
B) the likelihood that an award-winning promotional campaign can be generated
C) economic cost
D) pursuing the wrong marketing-mix strategy
E) the effect of increased market share on actual and perceived quality

Question 33

Market leaders are constantly under attack from large and small competitors alike.What is the most constructive response a market leader can make when defending its terrain

A) Basic cost control
B) Expanding expected benefits
C) Expanding desired benefits
D) Meet all challengers with a swift response
E) Continuous innovation

Question 34

Some market leaders have increased profitability by selectively ________ market share in weaker areas.

A) decreasing
B) increasing
C) protecting
D) sharing
E) trading

Question 35

________ defense involves occupying the most desirable market space in the minds of the consumers,making the brand almost impregnable.

A) Position
B) Flank
C) Preemptive
D) Mobile
E) Contraction

Question 36

A firm that serves small market segments not being served by bigger firms is known as a ________.

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

Question 37

Increasing ________ requires either (1)identifying additional opportunities to use the brand in the same basic way or (2)identifying completely new and different ways to use the brand.

A) amount of consumption
B) level of consumption
C) dedication to consumption
D) awareness consumption
E) frequency of consumption

Question 38

Companies successfully gaining market share typically outperform competitors in which of the following areas

A) New-product activity
B) Relative product quality
C) Marketing expenditures
D) All of the above
E) None of the above

Question 39

In ________,the market leaders stretches its domain over new territories that can serve as future centers for defense and offense.

A) counteroffensive defense
B) flank defense
C) mobile defense
D) contraction defense
E) position defense

Question 40

When the total market expands,the ________ usually gains the most.

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

Question 41

Patterns of ________ are common in capital-intensive,homogeneous-product industries,where competitors present similar offers to buyers and market shares show high stability.

A) "conscious parallelism"
B) "feature fashion"
C) "covert security analysis"
D) "supply delay"
E) "predatory pricing"

Question 42

Selective price cuts,intense promotional blitzes,and occasional legal action are commonplace in the strategic design of a(n)________.

A) frontal attack
B) flank attack
C) bypass attack
D) encirclement attack
E) guerilla warfare

Question 43

A market nicher is considered to be a(n)________ specialist if the firm specializes in producing a certain type of product or product feature such as Rent-a-Wreck that rents only "beat-up" cars.

A) end-user
B) vertical-level
C) customer-size
D) channel
E) product-feature

Question 44

As a market follower strategy,the ________ emulates the leader's products,name,and packaging,with slight variations.

A) counterfeiter
B) cloner
C) imitator
D) adapter
E) innovator

Question 45

In terms of comparisons with a market leader,whereas the market leader achieves high volume,the market nicher achieves ________.

A) high margin
B) low margin
C) high promotability
D) medium pricing
E) lower demand

Question 46

As a market follower strategy,the ________ copies some things from the leader but maintains differentiation in terms of packaging,advertising,pricing,or location.This strategy is tolerated by the market leader as long as the follower's aggressiveness does not mount.

A) counterfeiter
B) cloner
C) imitator
D) adapter
E) innovator

Question 47

In his article,"Innovative Imitation," Theodore Levitt argues that ________.

A) imitation is wrong and should be punished
B) product imitation might be as profitable as a strategy of product innovation
C) innovation is not possible without substantial imitation
D) innovation cannot begin unless dissatisfaction with imitation occurs
E) imitation should be against the law because of the intellectual property decision involved

Question 48

A market challenger must decide who to attack.All of the following are considered as likely possible targets (as per information found in the text)EXCEPT ________.

A) the market leader
B) firms its own size that are not doing the job
C) firms its own size that are underfinanced
D) a global conglomerate that is market hungry
E) small local firms

Question 49

Which of the following types of companies is characterized as being "too reactive"

A) Competitor centered
B) Customer centered
C) Service centered
D) Distribution centered
E) Niche centered

Question 50

All of the following are considered to be viable attack strategies that can be employed by a market challenger EXCEPT ________.

A) counteroffensive attack
B) frontal attack
C) flank attack
D) bypass attack
E) guerilla warfare

Question 51

The key idea in successful nichemanship is specialization.Which of the following specialists would most closely be identified with the characterization of being an organization that limits its selling to one customer

A) End-user specialist
B) Vertical-level specialist
C) Customer-size specialist
D) Specific-customer specialist
E) Quality-price specialist

Question 52

Which of the following types of companies is felt to be in a better position to identify new opportunities

A) Competitor centered
B) Customer centered
C) Service centered
D) Distribution centered
E) Niche centered

Question 53

Avon became a major cosmetics company by perfecting door-to-door selling instead of battling other cosmetic firms in conventional stores.This is an example of which of the following specific market challenger attack strategies

A) Manufacturing cost reduction
B) Intensive advertising promotion
C) Distribution innovation
D) Product innovation
E) Product proliferation

Question 54

According to attack strategies available to the market challenger,the ________ can be used when the challenger spots areas where the opponent is underperforming.

A) encirclement attack
B) frontal attack
C) flank-geographic attack
D) backwards-flank attack
E) guerilla warfare

Question 55

In a ________ company,the obsession of the company is with the customer,not the competition.

A) niche-centered
B) price-centered
C) cost-centered
D) customer-centered
E) promotion-centered

Question 56

An alternative to being a market follower in a large market is to be a leader in a small market.This type of competitor is called a(n)________.

A) marketing knave
B) market nicher
C) segment king
D) guerilla marketer
E) strategic clone

Question 57

A marketing manager has decided to "leapfrog" competition by moving into cutting-edge technologies.This indirect approach to attacking competition can be characterized as ________.

A) flank attack
B) encirclement attack
C) bypass attack
D) guerrilla warfare
E) frontal attack

Question 58

All of the following are considered market follower strategies EXCEPT ________.

A) counterfeiter
B) cloner
C) imitator
D) innovator
E) adapter

Question 59

Sally Seabrook is an up-and-coming marketing manager for a large department store chain.Ms.Seabrook has distinguished herself with bold strategies such as launching attacks on her primary competitor from several fronts,including advertising,new store openings,and new distributor alliances.Which of the following market challenger attack strategies is Ms.Seabrook using to attack her competition

A) Frontal attack
B) Bypass attack
C) Guerrilla warfare
D) Flank attack
E) Encirclement attack

Question 60

Which of the following types of companies is characterized as having a "fighter orientation"

A) Customer centered
B) Competitor centered
C) Distribution centered
D) Promotion centered
E) Niche centered

Question 61

When U.S.tobacco companies acknowledged the growing curbs on cigarette smoking and decided to move into new industries,such as beer,liquor,and soft drinks,they were employing a market broadening mobile defense.

Question 62

Firms should only ever target weak competitors in order to maximize the return on their competitive investments.

Question 63

All happy customers are profitable.

Question 64

The best defense against strong buyers is to develop superior offers that strong buyers cannot refuse.

Question 65

The aims of defensive strategy are to reduce the probability of attack,divert attacks to less-threatening areas,and lessen their intensity.

Question 66

Companies that make steady gains in mind share and heart share will inevitably make gains in market share and profitability.

Question 67

The most attractive segment is one in which the entry barriers are low and exit barriers are high.

Question 68

Share of market is the percentage of customers who named the competitor in responding to the statement,"Name the first company that comes to mind in this industry."

Question 69

An industry is a group of firms that offer a product or class of products that are close substitutes for one another.

Question 70

Because consumers generally fail to recognize when their toothbrushes need to be replaced,many new toothbrushes have a colored set of bristles that fade with wear,signaling the consumer that he or she needs to buy a new toothbrush.This is an example of increasing sales through increasing the frequency of consumption.

Question 71

Although marketers assume well-known brands are distinctive in consumers' minds,unless a dominant firm enjoys a legal monopoly,it must maintain constant vigilance.

Question 72

If a market leader follows a strategy of continuous innovation,it keeps increasing its competitive strength and value to its customers.

Question 73

Markets have become too competitive to focus just on the consumer alone.

Question 74

Companies that attempt to increase market share by cutting prices more deeply than competitors typically achieve significant gains.

Question 75

All companies seek to maximize both long- and short-term profits.

Question 76

Larger package sizes have been shown to increase the amount of product that consumers use at one time.This is an example of increasing sales through increasing the amount of consumption.

Question 77

Few industries contain a single firm that is acknowledged as the marked leader.

Question 78

Profitability always rises with market share gains.

Question 79

As a strategy for expanding the total market,a market-penetration strategy is aimed at consumers who have never used the product.

Question 80

A market is unattractive if it already contains numerous,strong,or aggressive competitors.