Mark Test 3
Which of the following actions, if it actually happened, would most likely support and enhance an operational excellence macro strategy?
3M Corporation implementing new software to improve communication with its suppliers
Customer retention programs are based on what concept?
Customer relationships should be viewed from a lifetime value perspective.
T/F: A mission statement describes the specific actions a firm will take to achieve its goals
False
T/F: To build a sustainable competitive advantage, companies should focus on a single strategy.
False
T/F: STP refers to segmentation, testing, and promotion
False; STP stands for segmentation, targeting, and positioning
E-books, in addition to being an alternative product form, provide __________ value creation since they can be downloaded via the Internet immediately when and where they are needed.
Place
T/F: It is not always necessary to go through all the steps in the marketing planning process.
True
T/F: Strong supplier relations and efficient supply chains help firms such as Walmart achieve operational excellence.
True
Lionel is asked to conduct an STP analysis for his firm. The first step he should perform in this analysis is to
divide the marketplace into subgroups.
As it pertains to the marketing plan, understanding the causes of performance, regardless of whether that performance exceeded, met, or fell below the firm's goals
enables firms to make appropriate adjustments.
Craig sees that his company's quarterly sales and profits are significantly above projections and says, "That's great. Let's keep doing what we've been doing." Craig is ignoring the __________ step of the marketing planning process.
evaluate performance
When firms successfully implement poor strategies (perhaps due to good luck) or do a poor job of implementing good strategies, it can be difficult to
evaluate performance and make adjustments.
If a firm wants to develop a sustainable competitive advantage, it should
examine its operations and customer relations to identify significant things competitors cannot easily copy.
Lamar owns four dry cleaning stores in the suburbs of Orlando, Florida. He recently updated his STP analysis, and has just finished adjusting his marketing mix based on the STP results. His next strategic marketing decision will most likely involve determining
how to allocate resources among his four stores.
Which of the following is the third step in the marketing planning process?
identify and evaluate opportunities
Most banks implement customer retention programs aimed at their best customers. They do this because they know that retaining customers usually results in
increased long-term profits.
Using the BCG portfolio analysis, a "dog" should be phased out unless
it complements or boosts the sales of another product.
A competitive advantage based on location is often sustainable because
it is not easily duplicated.
Some universities offer online degree programs, competing with traditional colleges based on the convenience of taking online courses. These online programs are most likely pursuing which macro strategy?
locational excellence
Which of the following is least likely to provide a sustainable competitive advantage?
lowering prices
Many states create licensing requirements for a variety of professionals (such as lawyers and accountants) designed to restrict entry into their market by professionals from other states. This strategy limits ____________ growth strategies.
market development
After defining the business mission, what should a firm do next to develop a marketing plan?
perform a situation analysis
Which of the following is the best way to build a sustainable competitive advantage using product excellence?
positioning the product using a clear, distinctive brand image
3M involves its customers in the process of developing new products. In this way, it can benefit from current customers' insights and develop new products that will meet these customers' needs. 3M is pursuing a __________ growth strategy.
product development
A(n) ___________ is a group of products that consumers may use together or perceive as similar in some way.
product line
In most companies, portfolio management is typically done at the SBU or ___________ level of the firm.
product line
Google and other search engines allow marketers to bid to have their ads shown when consumers search on keywords related to the firm's products. These marketers are attempting to create value through
promotion.
Which of the following is not one of the four major growth strategies marketers typically utilize?
segment development
When discussing the marketing planning process, STP stands for
segmentation, targeting, and positioning.
Fernando was thrilled to find out that his company had just decided to invest a great deal of money in the product he was managing. He knows that even with its recent high rate of growth and the fact that it dominates its market, he would need more money to establish it firmly. Using the BCG portfolio analysis, his product would be classified as a(n)
star
As part of her company's SWOT analysis, Valerie is assessing the company's internal environment, including
strengths and weaknesses.
When positioning products relative to competitors' offerings, firms typically are most successful when they focus on opportunities
that build on their strengths relative to those of their competitors.
Four companies dominate the cereal industry. These firms produce in large volumes, promote heavily, and control access to the supermarket shelves through "slotting allowances," which are payments to retailers in return for shelf space. Combined, these four firms have
a sustainable competitive advantage.
Zara is a women's clothing retailer headquartered in Spain, with stores located in many countries. Zara has developed a "quick response" system that allows store merchandise to be adjusted rapidly to fit changing customer preferences. Every aspect of Zara's operation is optimized for this system, making it difficult for competitors like The Gap to duplicate. Zara has established
a sustainable competitive advantage.
"Effective marketing doesn't just happen." It is
carefully planned.
In BCG portfolio analysis, products in low-growth markets that have received heavy investment and now have excess funds available to support other products are called
cash cows.
Marketers want their firms to develop excellent supply chain management and strong supplier relations so they can
create a sustainable competitive advantage.
Taking steps to encourage customer loyalty is the focus of developing the macro strategy of _______ excellence.
customer
Gerald's Tire Store sets itself apart from competitors by the extra attention it pays to retaining loyal customers by providing fast, courteous service in a clean, professional-looking environment. Gerald's has used this strategy for over 40 years, expanding to 15 outlets. Gerald's Tire Store has created a ___________ macro strategy to create and deliver value and to develop a sustainable competitive advantage.
customer excellence
Anita has gone to the same hair salon for the past 10 years. She believes that her stylist, the salon owner, does a better job of cutting and styling her hair than anyone else could. Other salons have opened closer to Anita's home, some offering more plush facilities or lower prices, but she isn't tempted to switch. Anita's attitude toward the salon is an example of
customer loyalty.
Allen is in the marketing department of a midsized firm that develops and sells communications systems. He is proud of the human resource area in the company that provides the firm with excellent employees. Allen himself really enjoys his work, but he knows the work of HR helps create an operational advantage for the firm because of all the following except
the company provides products with a high perceived value.
Some banks have begun offering special accounts designed to attract junior high school students. These kids save in such small amounts that the accounts cost banks more to maintain than they are worth. But bankers know that consumers are creatures of habit and hope that the young people they serve now will become adult customers. These banks recognize
the lifetime value of customers.
Heather has been assessing a number of her firm's products using the Boston Consulting Group (BCG) approach to portfolio analysis. She has been trying to assess the strength in a particular market and is looking at the sales of the product and the overall market as well as the sales of competitors. Heather is trying to determine
the product's relative market share.
In 2006, Ford Motor Company announced it would severely cut back its automobile production. For parts companies supplying Ford its parts, this represented a(n)
threat.
In value-based marketing, the promotion element of the four Ps communicates the ________ to customers through a variety of media.
value proposition
T/F: Duke's is a surfer-themed restaurant chain in Hawaii. Most of its customers are tourists. In a SWOT analysis for Duke's, the possibility that the recession might cut back on tourism in Hawaii would be considered a weakness
False; A recession is an external factor with possible negative results, so it is a threat
T/F: The components of a SWOT analysis are strengths, weaknesses, opportunities, and tactics
False; The components of a SWOT analysis are strengths, weaknesses, opportunities, and threats
In recent years, cellular (mobile) service providers have worked hard to eliminate "dead zones," providing customers with service wherever they travel. By working to make the network available in more locations, cellular service companies are focusing on __________ value creation.
Place
__________ involves the process of defining the marketing mix variables so that target customers have a clear, distinctive understanding of what a product does or represents in comparison with competing products.
Positioning
In 2006, Walmart announced that it would begin selling organic food products. In doing so, Walmart was most likely trying to
attract a different market segment.
Which of the following factors, listed in a situation analysis for a major U.S. auto manufacturer, is the best example of a threat?
A New York law firm has filed a $10 million class action suit against the company on behalf of car owners whose gas tanks exploded.
________ involves the process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what the product does or represents in comparison with competing products.
Market positioning
The global athletic footwear market is expected to experience only very slow growth over the next several years. Nike is the market leader. According to Boston Consulting Group portfolio analysis, how should Nike treat its athletic shoe business?
Nike's athletic shoe business still requires some investment, but is likely to produce excess resources that can be invested in other divisions of the company.
Which of the following factors, listed in a situation analysis for a major U.S. auto manufacturer, is the best example of an opportunity?
Recent consumer studies have indicated that Chinese consumers prefer American cars.
Subway is a large chain of franchise sandwich shops. Marcia owns three Subway stores in a large city. At the end of the year, she notes that sales rose from 2 to 5 percent over last year's sales at Stores 1 and 2, but fell 2 percent at Store 3. Based on this information, which of the following is the best course of action as to how Marcia should reward (or punish) her store managers?
She should seek more information about why the stores had different results before making a decision.
T/F: iTunes software is often credited with the success of the Apple iPod MP3 player, because it made the iPod easier to use than competing players and was difficult for competitors to duplicate. This is an example of a sustainable competitive advantage.
True
One example of a customer loyalty program is
a "frequent diner" card at a restaurant, offering a free appetizer for every $100 in food purchases.
A marketing strategy identifies three things: ________, a related marketing mix, and the bases on which the firm plans to build a sustainable competitive advantage.
a firm's target markets
Over the last few months, Juan and his colleagues have analyzed the current business situation and identified target markets for his firm's personal care products. Finally, they developed the products, prices, distribution, and promotion that should appeal to each of those target markets. In doing so, Juan has also identified what he believes is an advantage his competitors cannot match. Juan and his colleagues have been developing
a marketing strategy.
Nordstrom, an upscale department store, has a well-known reputation for going the extra mile to serve its customers. This reputation for excellent customer service will most likely result in
a sustainable competitive advantage.
When a pharmaceutical company develops a new medication, it typically applies for a patent in order to prevent competitors from developing copycat products for several years. Pharmaceutical companies apply for patents to establish
a sustainable competitive advantage.
The idea of value-based marketing requires firms to charge a price that
captures the value customers perceive that they are receiving.
Fourteenth National Bank prides itself on offering better service than any of its competitors. If this is accurate, and if customers recognize and value Fourteenth National's superior service, the bank creates and delivers value through
customer excellence.
When Ramona, the keynote speaker at a major business leaders' conference, arrived in the middle of the night at the Ritz-Carlton, she was exhausted and her suit was wrinkled from her 10-hour plane trip. The night clerk found someone to dry clean Ramona's suit and have it ready for her morning presentation. She has been a loyal Ritz-Carlton customer ever since. In this example, Ritz-Carlton demonstrated the macro strategy of
customer excellence.
In mid-2010, Hewlett-Packard Company (HP) acquired Palm Computing Inc., a manufacturer of personal devices and smartphones. Before deciding to acquire the company, strategic planners at HP spent time thinking about how Palm and HP would "fit" together, and how the acquisition might change HP's core goals and objectives. The strategic planners were engaged in the ____________ step of the marketing planning process.
define the business mission
Sodexo is a corporation that manages school cafeterias, university dining halls, mess halls at military bases, concession stands at sports arenas, and other large-scale food service facilities. If Sodexo were to begin to sell individual frozen meals in supermarkets, it would be pursuing a __________ growth strategy.
diversification
Introducing newly developed products or services to a market segment the company is not currently serving is called
diversification.
During a SWOT analysis, a company should assess the opportunities and uncertainties of the marketplace due to changes in several factors, given the acronym CDSTEP. Which of the following is not one of these factors?
ethical
Carla has been directed by her regional marketing manager to cut prices on seasonal items, place an ad in the local paper, and tell distributors to reduce deliveries for the next month. Which step of the strategic marketing planning process is Carla engaged in?
implement marketing mix and resources
During which phase of the marketing planning process does a firm identify and evaluate different opportunities by engaging in segmentation, targeting, and positioning?
implementation phase
A regional manager at GNC, a chain of retail stores selling nutritional supplements, is reviewing sales data after a recent in-store promotion. The data show success in some stores and limited response in others. To understand the differences between stores, the manager will probably next review the company's
implementation programs, to see if the promotion was handled consistently in the different stores.
When marketers use a variety of communication disciplines—advertising, personal selling, sales promotion, public relations, direct marketing, and online marketing—in combination to communicate a value proposition to the customer, it is referred to as
integrated marketing communications.
The strategic marketing planning process
is not always sequential.
Value creation through place decisions for a consumer product involves
making sure the product is available in the stores where customers will want to find it, and that it is always in stock so they can buy it when they want to.
A __________ growth strategy employs the existing marketing offering to reach new market segments.
market development
H&R is a small, local heating and air conditioning business. The area military base is a potential source of growth, and H&R already installs and services the type of equipment the military would require, but it is difficult to get established as a certified government contractor. H&R is considering a ____________ growth strategy.
market development
Quitman Enterprises sells its business language dictionary to college students throughout the United States. Joseph Quitman, the owner, wants to start selling the book to international students abroad. Quitman wants to pursue a __________________ growth strategy.
market development
To determine how attractive a particular market is using the BCG portfolio analysis, __________ is(are) established as the vertical axis.
market growth rate
Abercrombie & Fitch, a clothing retailer, includes a "SHARE" link on the product pages of its website. This link encourages an Abercrombie customer to post a link (perhaps showing a new style of jeans) on Facebook or Twitter. Abercrombie & Fitch hopes that the customer's friends (who are probably very much like current customers) will click the link, visit the page, and make purchases. This is an example of a __________ growth strategy.
market penetration
Adrienne decides to add new sales representatives and increase advertising to increase sales in her existing market for her current line of security systems. Adrienne is pursuing a __________ growth strategy.
market penetration
Most banks now have customer relationship software that, when a customer contacts the bank, tells the service representative what types of accounts, loans, and credit cards the customer currently has. Service representatives use this information to sell some of the other services the bank currently offers to these customers. This is a ___________________ growth strategy.
market penetration
The process of dividing the market into groups of customers with different needs, wants, or characteristics is called
market segmentation.
Suppose your university made a sizable investment in its career services—additional counselors, increased efforts to bring in recruiters, and other services aimed at helping students find jobs. This investment would enhance the university's _____________ in an attempt to create value for students and recent graduates.
product value
For many years, Southwest Airlines distinguished itself as the low-cost airline. Now, many other low-cost competitors have entered the market. Similarly, Southwest was one of the first airlines to offer online ticketing. Now, all airlines have online ticketing. These examples suggest that
no single strategy is likely to be sufficient to build a sustainable competitive advantage.
Because it was able to deliver merchandise overnight, in the required quantities, and at a lower delivered cost than its competitors, Joe's Sports Shack was given exclusive rights to sell clothing with school logos for the school district. Joe's demonstrates ________ excellence.
operational
Firms achieve ___________ through efficient procedures and excellent supply chain management.
operational excellence
Samantha is charged with assessing her company's external environment as part of a SWOT analysis. Samantha will study her company's
opportunities and threats.
For U.S. businesses with strong export capabilities, expansion of U.S. trade agreements with other countries creates
opportunities.
In a SWOT analysis, increasing gasoline prices would represent a potential __________ for manufacturers of electric cars.
opportunity
Delta Airlines is among the companies experimenting with selling products and services on their Facebook pages. The idea is to make purchasing even easier for customers who may spend large portions of the day with Facebook active on their computers or mobile devices. There is no need even to navigate to Delta's website—users can book a trip in Delta's "Ticket Agent" application without ever leaving Facebook. Which element of the marketing mix does this represent?
place and value delivery
When conducting a SWOT analysis, in what phase of the strategic marketing process is an organization presently engaged?
planning
Which of the following is not one of the four overarching strategies to create and deliver value and to develop sustainable competitive advantages?
planning excellence
LeBron James, Alex Rodriguez, and other athletes are paid huge sums of money by companies for celebrity endorsements. If endorsements by these athletes create a clear understanding among consumers of the companies' products in comparison to competing products, they can help with the firm's __________ strategy.
positioning
A former advertising campaign for GEICO Insurance used the slogan "So easy, even a caveman could do it" to emphasize the ease of buying insurance on GEICO's website. This campaign was part of GEICO's
positioning strategy.
Many small businesses whose competitors are national franchises advertise "we are locally owned" or "we have been here since 1951." This is part of these firms'
positioning strategy.
In 2007, Apple Computer introduced its new iPhone, adding a cellular telephone, a camera, and Internet access to its iPod. The company was pursuing a(n) __________ strategy.
product development
Marketers who design and offer new products and services to their existing customers are pursuing a _________ growth strategy.
product development
Maryam phoned her auto insurance agent to renew her policy. The agent told her about new types of insurance now available—to cover her apartment, or even the engagement ring she just got from her fiancé. The agent was pursuing a ___________ growth strategy.
product development
Singapore Airlines seeks to differentiate itself from competing airlines, in part through innovative design of its airplane seats and in-flight entertainment systems. Through continuous innovation in these areas, Singapore Airlines is pursuing a(n) __________ macro strategy.
product excellence
A product that is in a high-growth market but has a low market share would be classified as a ________ on the BCG matrix.
question mark
After conducting STP analysis for her custom auto parts store and developing strategies for each of the four Ps, Monique now has to make _____________ decisions.
resource allocation
The first objective in the evaluate performance phase of the marketing planning process is to
review implementation programs and results using metrics.
When pursuing a market development strategy, expanding into international markets is generally
riskier than expansion in domestic markets.
Even when large discount retailers enter a market, a few small, local retailers survive and prosper. These small retailers have probably developed a(n) ________ that allows them to survive.
sustainable competitive advantage
The automobile manufacturing industry closely watches annual consumer satisfaction surveys. For years, Japanese car companies consistently had the highest levels of customer satisfaction, creating a(n) ________ for these companies.
sustainable competitive advantage
For years, when considering new products, marketers at Celestial Seasonings asked themselves, "What would Stacy think?" Stacy was a fictional character representing 25- to 50-year-old educated, upper-income women who rarely watched television but did a lot of reading. "Stacy" represented Celestial's primary
target market segment.
After identifying various market segments that her company could pursue, Lisa evaluated each segment's attractiveness based on size, income, and accessibility. Lisa was involved in
target marketing.
All of the following statements regarding marketing metrics are true except
they cannot be used to project the future.
Manufacturers that use just-in-time manufacturing systems coordinate closely with suppliers to ensure that materials and supplies arrive just before they are needed in the manufacturing process. While just-in-time systems can offer major advantages in terms of inventory costs, they must be carefully managed. If a firm found that its just-in-time system was badly managed, leading to frequent manufacturing delays due to missing parts, this would represent a(n) __________ in a SWOT analysis.
weakness