MKT 300 - Ch 3

AT&T reacted to the popularity of the cellular phone by adding several cellular models to its line of regular phones. Availability and popularity of cellular phones is most likely due to changes in the ____________ environments.

Technology affects marketing in two basic ways; opportunities for new products and for new processes.

Which of the following newspaper headlines would be LEAST likely to involve the political environment?

"Egg Sales Fall as Consumers Switch to Low Cholesterol Diets" would be LEAST likely to involve the political environment. It would involve the Cultural and Social Environment.

Baby boomers were born:

Baby boomers, those born between 1946 and 1964.

When conducting a competitor analysis, it is important for managers to take the viewpoint of

A competitor analysis is an organized approach for evaluating the strengths and weaknesses of competitors' marketing strategies. To identify potential competitors, it is useful to take the viewpoint of target customers. Companies may offer quite different products, but they are competitors if customers see them as offering close substitutes.

An energy company that has expertise in drilling for oil would also likely have the resources to:

A firm's expertise in drilling for oil can easily be expanded to capitalize on a new opportunity of drilling for natural gas.

Which of the following would help prevent marketing mistakes in evaluating international market opportunities?

A local citizen who knows the market environment may be able to identify an obvious problem ignored even in a careful analysis. Thus, it is very useful for the analysis to include inputs from locals.

A mission statement

A mission statement sets out the organization's basic purpose for being.

Nike claims in its Annual Report that "the reasons every NIKE employee comes to work every day is to create great product, to lead the athletic industry in innovation, and to serve the athlete." This is Nike's:

A mission statement sets out the organization's basic purpose for being. A good mission statement should focus on a few key goals rather than embracing everything.

A mission statement has the following purposes except:

A mission statement sets out the organization's basic purpose for being. A good mission statement should focus on a few key goals rather than embracing everything or providing detailed plans and goals.

A firm's product-market screening criteria for evaluating existing plans and possible new opportunities should consider:

A set of product-market screening criteria should analyze the firm's resources (for strengths and weaknesses), the environmental trends the firm faces, and the objectives of top management.

American economic and legislative thinking is based on the idea that

American economic and legislative thinking is based on the idea that competition among many small firms helps the economy.

Typically, firms need a hierarchy of objectives. Which of the following best represents a correct hierarchy of a firm's objectives?

As stated in Exhibit 3-2, firms need a hierarchy of objectives, moving from company objectives, marketing objectives, promotion objectives and then to sales promotion objectives.

Seniors and baby boomers are among the fastest-growing demographic groups on Facebook.

Baby boomers born between 1946 and 1964 are a powerful demographic force as there are large numbers of people in this group.

Regarding the current legal environment facing U.S. marketing managers:

Besides federal legislation marketers must be aware of state and local laws which vary but contain important regulations; food and drugs, and product safety are now controlled and businesses and individual managers are subject to both criminal and civil laws.

Which of the following countries is likely to see a population decline from 2010-2025?

Between 2010 and 2025, many European countries like Germany will experience declining populations.

According to projections, the population of _____ is likely to grow by 15 percent between 2010 and 2025.

Between 2010 and 2025, population growth will be about 15 percent in the United States.

Which of the following statements about the legal environment in the United States is not true?

Businesses and individual managers are subject to both criminal and civil laws. Penalties for breaking civil laws are limited to blocking or forcing certain actions—along with fines.

According to the "continuum of environmental sensitivity," which of the following types of products would be most sensitive to environmental changes?

Consumer products closely linked to other social or cultural variables are near the sensitive end of continuum of environmental sensitivity.

In which of the external environments changes usually occur most slowly?

Changes in related cultural values and social attitudes come slowly.

The economic environment

Changes in the economy are often accompanied by changes in the interest rate and inflation.

Interest rates

Changes in the economy are often accompanied by changes in the interest rate.

When a local bank in Kansas City makes loans to its small business customers, it charges them an interest rate for borrowing money. Interest rates are part of the ____________ environment

Changes in the economy are often accompanied by changes in the interest rate. This is part of the economic environment.

The Clayton Act is NOT concerned with:

Clayton Act aims at tying contracts, price discrimination by manufacturers; exclusive dealing contracts and actions that substantially lessen competition. It does not deal with actions that encourage competition.

Company objectives

Company objectives should supply guidelines that help managers determine which opportunities to pursue.

Swanson Beverages, Inc., is using ______________ to compare the strengths and weaknesses of its current target market and marketing mix with what its competitors are doing (or are likely to do).

Competitor analysis is an organized approach for evaluating the strengths and weaknesses of current or potential competitors' marketing strategies.

The Pure Food and Drug Act:

Consumer protection laws in the United States go back to 1906 when Congress passed the Pure Food and Drug Act. The law now bans the shipment of unsanitary products. Before the law, it was assumed that the old warning "let the buyer beware" would take care of consumers.

Along with studying trends in the environment, a first step in looking for attractive opportunities is to:

Every firm has some unique resources, and opportunities come from making use of these strengths.

Which of the following is not a marketing strength for a book publisher?

Flexible production facilities is a production resource, not an marketing resource.

Gross domestic product (GDP):

GDP is the total market value of all goods and services provided in a country's economy in a year by both residents and nonresidents of that country and thus it is affected by economic conditions and the productivity of workers in the country.

Using General Electric's "strategic planning grid," an opportunity rated "medium" in terms of industry attractiveness and "high" in terms of business strengths would be evaluated as:

GE feels opportunities that fall into the green boxes of the grid are its best growth opportunities.

GE's planning grid approach .

GE's planning grid approach could be adapted by another firm which might modify the evaluation to emphasize other screening criteria depending on its objectives and the type of product-market plans it is considering.

Gross national income (GNI): .

GNI is affected by economic conditions and the productivity of workers in the country.

General Electric's "strategic planning grid":

General Electric's (GE) strategic planning grid forces company managers to make three-part judgments about the business strengths and industry attractiveness and focuses on the ability of the company to pursue a product-market plan effectively. It is a subjective, multiple-factor approach.

Generation Y refers to:

Generation X, sometimes called Gen X, refers to the generation born immediately following the baby boom—from 1965 to 1977. Generation Y, sometimes called Millennials, refers to the generation born from 1978 to 1994.

Which of the following population groups is the most techno-savvy?

Generation Y, sometimes called Millenials, grew up with technology and hence are the most techno savvy.

____ refers to the total market value of all goods and services provided in a country's economy in a year by both residents and nonresidents of that country.

Gross domestic product (GDP) is the total market value of all goods and services provided in a country's economy in a year by both residents and nonresidents of that country.

Using General Electric's "strategic planning grid," an opportunity rated "medium" in terms of industry attractiveness and "medium" in terms of business strengths would be evaluated as:

In a General Electric's "strategic planning grid," yellow businesses are borderline cases wherein opportunities are rated "medium".

In a _____________ situation, competitors offer very similar products which customers see as close substitutes, and managers just compete with lower and lower prices as profit margins shrink.

In a pure competition, competitors offer very similar products. Because customers see the different available products as close substitutes, managers just compete with lower and lower prices, and profit margins shrink.

____ refers to market situation where one firm completely controls a broad product-market.

In monopoly situations, one firm completely controls a broad product-market.

The "total profit" approach to evaluating possible product-market strategic plans:

In the short run, the me-too product will make a profit sooner and might look like the better choice, if managers consider only one year's results. The improved product, on the other hand, will take a good deal of pioneering, but over its five-year life will be much more profitable.

X-Brand Bikes, a manufacturer of off-road bicycles, carefully developed a strategy for moving into South America. The strategy had poor results after interest rates and inflation rose rapidly in most of its South American markets, demonstrating the influence of the _____ on marketing strategy.

Interest rates and inflation are part of the economic environment.

When evaluating the potential of possible opportunities (product-market strategies), a marketing manager should:

It's important to evaluate each opportunity over the life of the project, since a good strategy may not produce profitable results at first. But, over the life of the project, the product and its strategy may look like winners.

In the U.S., which population groups will fuel new opportunities in tourism, healthcare and financial services?

Looking ahead, these shifts create new opportunities in industries such as tourism, healthcare and financial services—all of which are more important to the middle-aged and retired.

In the short run at least, which of the following is usually beyond the control of the marketing manager?

Managers can't alter the above given uncontrollable variables of the market environment.

If you go into a restaurant in Vienna, Austria, and ask for a Diet Coke, the waiter may have no idea what you are ordering. This is an example of which part of the external market environment?

Many variables make up the cultural and social environment, including the types of food that different people eat.

Few people in Europe diet. So the same soft drink that PepsiCo sells in the U.S. under the brand name of "Diet Pepsi" is sold in England under the brand name of "Pepsi MAX." This is an example of which part of the external market environment?

Many variables make up the cultural and social environment. Some examples are the languages people speak; the type of education they have; their religious beliefs; what type of food they eat; the style of clothing and housing they have; and how they view work, marriage, and family.

Which of the following is an example of the cultural and social environment?

Many variables make up the cultural and social environment. Some examples are the languages people speak; the type of education they have; their religious beliefs; what type of food they eat; the style of clothing and housing they have; and how they view work, marriage, and family. Over decades, the role of women has changed significantly. More than 70 percent of women age 35—44 work outside the home.

Low consumer spending and a lack of adequate financing are conditions that arise mostly due to factors in:

Marketers that evaluate opportunities during an economic downturn can expect depressed consumer spending and a potential lack of financing from lending institutions. These considerations arise from within the economic environment.

A(n) _______ is a marketing mix that customers see as better than a competitor's mix and cannot be quickly or easily copied.

Marketing managers should actively seek sustainable competitive advantage, a marketing mix that customers see as better than a competitor's mix and cannot be quickly or easily copied.

According to the "continuum of environmental sensitivity," which of the following types of products are less sensitive to environmental changes?

Most industrial products are near the insensitive end of continuum of environmental sensitivity.

Which of the following statements about nationalism is NOT TRUE?

Nationalistic feelings can reduce sales, but not always.

The different rates of population growth are important to marketers for all of the following reasons except

Retailers in growing areas may face tougher competition but it is competition for a larger number of customers. If the area is growing then both the number of competitors and the number of consumers is growing.

Which of the following age groups saw a decline in population from 2005-2015?

See Exhibit 3-7.

Setting objectives and strategies for the whole company is a job performed by:

Setting whole company objectives is ultimately the responsibility of top management. Top management must look at the whole business, relate its present objectives and resources to the external environment, and then decide what the firm wants to accomplish in the future.

The _____ _____ prohibits monopoly or conspiracy in restraint of trade.

Sherman Act

Since IKEA is known for fashionable modern-style home furnishings, the company would be likely to screen out business opportunities in:

Since modern design is a key strength at IKEA, the company would be likely to screen out business opportunities in antique furniture reproductions.

A marketer considering a business opportunity in the U.S. health care market must first evaluate new rules and regulations originating from:

The 2010 passage of the U.S. Patient Protection and Affordable Care Act sets up thousands of new health care regulations that marketers must evaluate before deciding to pursue a new opportunity. These regulations are now part of the legal environment in the United States.

Safety standards for products such as bicycles are set by the:

The Consumer Product Safety Act (of 1972) set up the Consumer Product Safety Commission. The commission found the bicycle the most hazardous product under its control.

If Climbing High Ladder Company produced ladders that were unstable and caused many injuries, the ___ has the power to force the company to recall its product.

The Consumer Product Safety Commission has the power to force a product off the market, or require expensive recalls to correct problems.

Pill Makers Pharmaceuticals extensively tests all of its drugs to assure that it follows the ____.

The Pure Food and Drug Act requires much testing of drugs.

The business strengths dimension of the GE grid focuses on:

The business strengths dimension of the GE focuses on the ability of the company to pursue a product-market plan effectively.

The "continuum of environmental sensitivity" suggests that:

The continuum of environmental sensitivity suggests that some products are more adaptable to international markets than others.

The direct market environment

The direct market environment includes customers, the company, and competitors.

The early antimonopoly (or "procompetition") laws passed in the United States:

The early antimonopoly laws passed in the United States include the Federal Trade Commission Act and the Clayton Act. They began with the Sherman Act in 1890. They affect the 4Ps and marketing mix planning and focus more on protecting competition, although over time, have moved toward protecting consumers.

The first and most important question to ask when evaluating product-market opportunities is:

The first thing to do when evaluating product-market opportunities is to analyze the firm's resources and the objectives of top management.

The _____ dimension of the GE grid helps managers answer the question: Does this product-market plan look like a good idea?

The industry attractiveness dimension helps managers answer the question: Does this product-market plan look like a good idea?

The median age of the U.S. population

The median age is growing because the percentage of the population in older age groups has increased.

Which of the following could serve as a firm's mission statement?

The mission statement sets out the organization's basic purpose for being. A good mission statement should focus on a few key goals rather than providing specific detailed objectives.

All of the following are examples of quantitative components of screening criteria that are used to narrow down to marketing strategies EXCEPT:

The strengths of the company are definitely important, but they are not quantitative components (like the other alternatives listed above).

Which of the following is not an element of the external market environment?

There are four areas of the external market environment: technological, economic, cultural and social, and political and legal.

Which of the following statements about the technological environment is NOT TRUE?

There is rapid transfer of technology from one part of the world to another. But technology transfer is not automatic.

How might an organization ensure that marketing objectives are compatible and aligned with top-level company objectives?

To prevent conflicting objectives from being set throughout the firm, the marketing manager should help determine the top-level company objectives.

A total profit approach to evaluating product-market strategic plans

Total profit approach can help evaluate possible plans even if they generate poor profits in some years. It may be that, over the life of a plan, it proves very profitable.

When screening for the best market opportunity for a firm, marketers should always avoid options that would combine:

When screening for opportunities, marketers must always avoid ventures that possess low industry attractiveness and expose the firm's weaknesses.

When a firm has multiple market opportunities from which to choose, marketers can use the following tool to identify the best ones:

When a firm has many possibilities to evaluate, it usually has to compare quite different ones. This problem is easier to handle with graphical approaches such as the nine-box strategic planning grid used by many companies.

According to the General Electric strategic planning grid, an opportunity which is low on the "business strengths" dimension but high on the "industry attractiveness" should be:

When an opportunity is low on the business strengths dimension but high on the industry attractiveness, GE may continue to support an existing business but will probably reject a proposal for a new one.

When marketers select criteria to help screen for new market opportunities, they should include quantitative components like:

When developing product-market screening criteria, managers should include quantitative components such as goals for sales, profit, and return on investment (ROI).

When selecting among possible product-market strategic plans,

When evaluating different plans the total profit approach requires estimates of sales, costs, and profits.

Which of the following is not a variable associated with the cultural and social environment?

While technological trends may be embraced or rejected for social-cultural reasons, technological innovation itself is a variable associated with the technological environment.

Comparing GDP for foreign countries can help a marketing manager evaluate potential markets if the manager remembers that:

when comparing GDP for foreign countries, GDP estimates may not be very accurate for very different cultures and economies.

Identify the incorrect statement pertaining to the GNI per capita.

lists the GNI per capita in the United States is $47,580 but Norway, Finland, and Switzerland have higher GNI per capita

Of the following objectives, the LAST objective(s) that a firm should specify is its ______________ objective(s).

sales promotion objectives

The Federal Trade Commission Act of 1914 is primarily concerned with

the Federal Trade Commission Act of 1914 is concerned with unfair methods of competition.

The Magnuson-Moss Act of 1975 focuses on which of the four Ps?

the Magnuson-Moss Act focuses on product which is one of the four Ps.

When Acme Tools was found guilty of giving one of its retailers lower prices on goods of "like grade and quality" without any cost justification, the firm was charged with a violation of the ___________.

the Robinson-Patman Act prohibits price discrimination on goods of "like grade and quality" without cost justification.