Mktg 351- Cousley (Ch 2)
According to the text, the 80/20 rule suggests that
80 percent of profits come from 20 percent of customers.
Which of the following is false with regard to customer lifetime value?
All customers have equal value to a firm.
The director of marketing for 3M tapes tells the rest of the management team, "When it comes to our transparent packaging tape unit, our strategy will be to use funds generated here to support our venture in the industrial bonding market." This strategy indicates that the packaging tape unit falls into which one of the following classifications?
Cash cow
What focuses on using information about customers to create marketing strategies that develop and sustain desirable customer relationships?
Customer relationship management
Identifying and analyzing a target market and developing a marketing mix to satisfy individuals in that market are essential elements of which of the following parts of strategic planning?
Developing a marketing strategy
Kate is upset because the bank did not credit her account with a deposit, which resulted in a returned check to Kate's landlord. When she was told the branch manager was on vacation, Kate resigned herself to waiting two weeks to have the matter resolved. To her surprise, though, the receptionist apologized for the error and drafted a letter to Kate's landlord while Kate waited. The bank was engaging in which type of decision-making strategy?
Employee empowerment
___________ involves giving customer-contact employees the authority and responsibility to make marketing decisions without seeking the approval of a supervisor.
Empowerment
A firm's organizational goals should be derived from its opportunities.
F
A firm's organizational mission should be derived from its goals.
F
A functional organization works effectively for large, decentralized companies
F
A long-term view, or vision, of what the organization wants to become is called a mission proclamation.
F
A marketing objective need not be consistent with the firm's overall objectives.
F
A marketing strategy is a written document that specifies the activities to be performed to implement and control a firm's marketing activities.
F
A strategic business unit is not self-supporting in terms of sales, markets, production, and other resources.
F
A strategic window results from the right combination of circumstances and timing, allowing a firm to take action to reach a particular target market.
F
Cash cows are market leaders that are growing fast, with substantial reported profits.
F
Empowerment refers to the measurement and evaluation of the quality of an organization's goods, services, or processes as compared with the best-performing companies in the industry
F
Internal management refers to the coordination of internal exchanges between the organization and its employees to achieve successful external exchanges between the organization and its customers
F
Marketing mix decisions must have two characteristics: consistency and timeliness.
F
Marketing planning consists of two major components: marketing objectives and a control process
F
Marketing planning establishes an organizational mission and goals, corporate strategy, marketing objectives, marketing strategy, and a marketing plan.
F
Marketing strategies should be established before marketing objectives are decided.
F
Question marks exist at a cost disadvantage and exhibit few opportunities for growth at a reasonable cost.
F
Stars are profitable products that usually generate more cash than is required to maintain share.
F
The concept of customer lifetime value includes only the customer's likelihood to engage in purchases.
F
The long-term health of the firm depends solely on having products that generate cash and provide acceptable reported profits.
F
The marketing control process does not monitor the activities of external sources of marketing assistance.
F
The primary way to reduce the discrepancy between planned and actual performance is to rewrite the performance standard.
F
The realized strategy is the one management decided upon during the planning phase and wants to implement.
F
Which of the following is a characteristic of a marketing objective?
It is consistent with both business-unit and corporate strategy.
Which of the following statements about the marketing mix is incorrect?
Once a marketing mix has been created for a particular target market, it cannot be changed until a new strategic window opens.
If you were a marketing manager, under which type of organizational structure would you most likely be working if your firm were a large business with centralized marketing operations?
Organization by function
Which of the following is not a component of a marketing plan?
Product
Stratford Manufacturing is interested in total quality management and wants to learn more about its principles. Which of the following elements will Stratford not address in its investigation of TQM?
Purchasing lowest-cost materials
Sayid's employer is currently developing a new marketing strategy. The top managers have developed the marketing strategy and have given it to Sayid so that he can now develop an implementation plan. Sayid's company will most likely end up with which type of strategy?
Realized
Which of the following is not a purpose of the marketing plan?
Serve as a contract with the customer
Which of the following statements is incorrect?
Strategic planning begins at the marketing level and proceeds through business-unit and corporate levels.
A competitive advantage is created when a company matches its core competency to the opportunities it has discovered in the market.
T
A core competency is something a firm does extremely well—sometimes so well that it gives the company an advantage over its competition.
T
A large company that markets products throughout the nation could use a regional type of organization.
T
A market is a group of individuals and/or organizations that have needs for products in a product class and have the ability, willingness, and authority to purchase these products.
T
A marketing unit can be organized according to functions, products, regions, or customers
T
A sustainable competitive advantage is one that cannot be copied by a firm's competitors.
T
An organization's goals focus on the ends or results that the firm seeks.
T
Corporate strategic planners focus on dimensions such as competition, diversification, differentiation, environmental focus, and interrelationships among SBUs.
T
Corporate strategy determines the means for utilizing resources in the functional areas of business to reach the organization's goals.
T
Customer Relationship Management strives to build satisfying exchange relationships between buyers and sellers by gathering useful data at all customer-contact points.
T
Each of the marketing mix elements must work together with the others.
T
Firms that truly adopt the marketing concept develop a distinct organizational culture based on a shared set of beliefs that makes customers' needs the pivotal point of the firm's decisions about strategy and operations.
T
In a traditional organization, marketing decisions are generally centralized at the top levels of the organization.
T
Internal marketing may involve market segmentation, product development, research, distribution, public relations, and sales promotion.
T
Marketing managers can classify a firm's products into four basic types: stars, cash cows, dogs, and question marks.
T
Marketing objectives should be stated in such a way that the degree of accomplishment can be measured accurately.
T
Marketing objectives state what is to be accomplished through marketing activities.
T
Marketing planning and implementation are inextricably linked in successful businesses
T
Marketing plans may be developed for strategic business units, product lines, individual products or brands, or specific markets
T
Organization by types of customers can work well for a firm that has several groups of customers with different needs and problems.
T
Performance standards are established as part of the marketing control process.
T
Product organization is appropriate for a firm that produces and markets a diverse set of products.
T
Sometimes the information required to control marketing activities is available but too costly.
T
The Boston Consulting Group approach is based on a philosophy that a product's market growth rate and its market share relative to competition should be helpful in determining its marketing strategy.
T
The Boston Consulting Group's model serves as a diagnostic tool to spotlight strategic business units that have an opportunity to grow rather than as a guide for making strategy prescriptions.
T
The analysis of strengths and weaknesses focuses on internal factors that give the organization certain advantages and disadvantages in meeting the needs of its target markets
T
The decisions made in creating a marketing mix are only as good as the organization's understanding of the target market.
T
The strategic planning process begins with a detailed analysis of the organization's strengths and weaknesses and the identification of opportunities and threats within the marketing environment
T
The time lag between the performance of marketing activities and the effects of such activities limits a marketing manager's ability to measure the effectiveness of marketing activities.
T
Through the process of strategic planning, a firm establishes an organizational mission and goals, corporate strategy, marketing objectives, marketing strategy, and a marketing plan
T
When properly implemented, a good marketing strategy enables a company to achieve its business-unit and corporate objectives.
T
Which of the following statements best describes total quality management?
The coordination of efforts directed at improving customer satisfaction, increasing employee participation, forming and strengthening supplier partnerships, and facilitating continuous quality improvements
According to the textbook, which of the following statements is most accurate?
There is no single approach to organizing a marketing unit that works well in all businesses.
The information in EXperience Limited's database could be best used to develop
a CRM program
According to the text, a market is defined as
a group of individuals and/or organizations that have needs for products in a product class and have the ability, willingness, and authority to purchase these products.
In response to the increase in demand for organic foods, Wegmans, Inc., a regional supermarket, recently created organic food departments within their large stores. The creation of these departments was a result of
a market opportunity
After determining that consumers had concerns about fat and carbohydrates, Sardino's Pizza began offering a low-fat, low-carb pizza product. The creation of this new product was the result of
a market opportunity.
When Opryland Hotel wants to have at least 90 percent of its customers indicating they had a memorable and satisfying experience at the hotel, this is an example of
a marketing objective
High Gliding Air Academy is developing its marketing mix for the coming year. Its managers know that they must first select _________, which may be the most important decision they make in the planning process.
a target market
A strategic window is
a temporary period of optimum fit between the key requirements of a market and the particular capabilities of a firm competing in that market.
The marketing plan is
a written document detailing activities to be performed to implement and control marketing actions.
Customer relationship management is facilitated by gathering useful data from
all customer-contact points.
The fact that college enrollments have been increasing at a fast rate the past few years is an example of _____ and creates a _______ for EXperience Limited.
an environmental factor; marketing opportunity
The strategic planning process begins with
analysis of the marketing environment.
Business decisions made in creating a marketing mix
are only as good as the organization's understanding of the needs of the target market.
Jason, a 17-year old high school student, wants to buy a pack of Marlboro Lights. He has the money to purchase them, but he is still not considered to be a market for the product due to his lack of _____ to buy.
authority
If Apple measured and evaluated the quality of its goods, services, and processes as compared with those of the best-performing companies in the computer industry, it would be employing
benchmarking
The term "______" describes measuring and evaluating a firm's quality in products and processes against industry leaders.
benchmarking
According to the Boston Consulting Group, marketers may classify their products as all of the following except
cash contributors.
According to the BCG matrix, the hang-gliding and bungee jumping tours have been a ____ for EXperience Limited, while the skydiving and motorcross tours represent a_____________.
cash cow; question mark
The Boston Consulting Group classifies products that have a dominant market share but low prospects for growth and that generate more cash than is required to maintain market share as
cash cows.
At Mrs. Fill's Cookie Co., top-level managers delegate very little authority to lower-level employees. Mrs. Fill's is a(n) ___________ organization.
centralized
In a traditional organization, marketing decisions are likely to be
centralized at the top levels of the organization.
A __________ is created when a company matches its core competency to opportunities it has discovered in the marketplace.
competitive advantage
Microsoft's marketing, technical skills, and continuing investment in improving its software systems give it a(n) ___________ because it makes computers easier to use.
competitive advantage
Southwest's low fares, dependability, and its on-time flights represent its
competitive advantage
All marketing mix decisions must have two characteristics: ___________ and ___________.
consistency; flexibility
Gucci Group, a marketer of high-fashion products, achieved a company turnaround by ensuring that its brand had the same image and proper display around the world. It also lowered prices on some items, like handbags, to be more competitive. This illustrates a company working to develop a marketing mix that is both _______ and _______.
consistent; flexible
Marketing managers can take each of the following corrective actions for reducing a discrepancy between established performance standards and actual performance except
coordinating a new step in performance analysis.
A __________ is something that an organization does extremely well and may give a company an advantage over its competition.
core competency
The reputation and well-known brand name of Rolex watches represents a ________ for Rolex.
core competency, market opportunity
___________ strategy determines the means for utilizing resources in the functional areas of marketing, production, finance, research and development, and human resources to achieve the organization's goals.
corporate
A firm's unique symbols, personalities, and philosophies comprise its
corporate identity.
Resource deployment and coordination of functional areas of business are determined by
corporate strategy.
Electronic marketing has greatly improved the ability of marketers to target individual customers. As a result, many feel that marketing's emphasis is shifting from share of market to share of
customer
Borders Books uses technology to help them identify specific customers, establish interactive dialogues with them to learn about their needs, and combine this information with their purchase histories to customize products to meet those needs. Borders Books is using the _____ approach.
customer relationship management
Using information about customers to create marketing strategies that develop and sustain desirable long-term customer relationships is known as
customer relationship management
When managers at Logistics Pro are developing their strategic plan, they use a market orientation as a guide to ensure that ________ is an integral part of the process.
customer satisfaction
The Acme Corporation is expanding operations into countries outside the United States. To improve local managers' responsiveness to local conditions, Acme's senior management has decided to delegate decision-making authority further down the chain of command. Acme is
decentralizing
Key factors in determining the best organizational structure for a marketing unit are the
diversity of the firm's products and the characteristics and needs of the people in the target market.
A server in a fine restaurant has the authority to give a complimentary dessert to a dissatisfied customer when the customer complains about the meal or service. This is an example of
empowerment.
The first step in the marketing control process is to
establish performance standards.
The marketing control process consists of
establishing performance standards, evaluating performance, and reducing the differences between desired and actual performance
One way that Saturn evaluates its product and service level is by how well it ranks on the J. D. Power & Associates Sales Satisfaction Survey. In doing so, Saturn is
evaluating actual performance.
A marketing plan usually begins with a(n)
executive summary.
A competitive advantage exists when a
firm matches a core competency to opportunities it has discovered in the marketplace
Ford has centralized marketing operations with personnel who direct marketing research, distribution, sales, advertising, and so forth reporting directly to the top-level marketing executive. Ford's marketing department is organized by
function
According to the Boston Consulting Group, question marks are characterized as products
having a small share of a growing market and requiring large amounts of cash to build market share
Meredith knows that whether she decides to interact with her customers in person, on the telephone, online, or by fax, that ________ should ultimately drive the marketing strategy.
her customers
To formulate a marketing strategy, one must
identify and analyze a target market and develop a marketing mix to satisfy individuals in that market.
In essence, all organizations have two types of strategy: ___________ is the strategy that the organization decides on during the planning phase, and ___________ is the strategy that actually takes place.
intended strategy; realized strategy
The employees of Zingerman's Deli are its ______ customers.
internal
For marketing implementation to be successful, the needs of _________ customers must be met.
internal and external
Starbucks provides training and support to its employees, including health care benefits. Through these ____________ efforts Starbucks is better able to deliver quality products and service to its customers.
internal marketing
A disadvantage of organizing a firm's marketing unit by products is that
it can be rather expensive.
The time lag between the performance of marketing activities and their results
limits the marketing manager's ability to measure the effectiveness of marketing activities.
A group that has the willingness, ability, and authority to buy a product is a
market
Realizing that consumers have begun to seek vehicles that use less gasoline, Toyota heavily promotes its hybrid automobiles to capitalize on this __________ while the strategic window is open.
market opportunity
When the right combination of circumstances occurs at the right time to allow an organization to take action toward a target market, the firm is faced with a
market opportunity.
The percentage of a market which actually buys a specific product from a specific company is referred to as that product's
market share
Which of the following is the most specific and detailed type of business strategy?
marketing
The process of putting marketing strategies into action is called
marketing implementation.
Hallaway's Corp.'s new shampoo, VS2, is faltering badly in the market. Hallaway's marketing personnel are unsure who is responsible for various marketing tasks, when these tasks are to be completed, or what resources have been allocated. Hallaway Marketing Director Carolyn Willis said that the problem is that VS2 has the most poorly written ___________ she has ever seen.
marketing plan
CyberCycle Inc., is preparing a written document specifying the activities to be performed to implement and control its marketing activities. This document is called the
marketing plan.
Starbucks is presently involved in a process of assessing marketing opportunities and resources, determining marketing objectives, re-defining marketing strategies, and developing guidelines for implementation and control. Thus, Starbucks is involved in
marketing planning.
Safeway Food Stores is involved in identifying and analyzing a target market. The firm then develops a marketing mix to satisfy individuals in that market to gain long-term competitive advantages. Based on this example, Safeway is creating a
marketing strategy
Organizing a marketing unit by regions works well for a company that
markets products throughout the nation.
An organization's business goals should be derived from its
mission statement.
When an organization attempts to control its marketing activities, it may find it difficult to
obtain the necessary information
Favorable conditions in the marketplace environment that could produce business rewards for the organization if acted upon properly are called
opportunities
Maintaining the current culture of "fun" for Southwest Airlines' employees is most likely a(n)
overall organizational objective.
Morris Business Products Co. has established a monthly sales quota of $150,000. This is a(n)
performance standard
An expected level of performance against which actual performance can be compared is a
performance standard.
The Boston Consulting Group's matrix is based on the
philosophy that a product's market growth rate and its market share are important determinants of its marketing strategy.
Procter & Gamble, like many firms in the consumer packaged-goods industry, is organized by
product
A firm that markets diverse products would most likely base the organization of its marketing department on
products
A marketing plan
provides a framework for implementing and controlling marketing activities.
The _________ strategy in an organization often does not live up to marketing planners' expectations.
realized
Suppose a customer calls Ann's office at Frito-Lay in Atlanta. The customer has a friend in Seattle who was just telling her about a new snack Frito-Lay has introduced that is selling rapidly. Ann's office does not market this product, and at the present knows very little about it. Based on this information, this firm is most likely organized according to which of the following?
region
A firm that wants to put more senior management personnel into the field, to get closer to customers, and to enable the company to respond more quickly and efficiently to competitors would probably organize its marketing unit on the basis of
regions
Customer relationship management systems cannot be effective unless they are developed as
relationship-building tools
The most important component of customer relationship management is
relationships with customers
The Texas Pitt Barbecuem Corporation has conducted a SWOT analysis of its competition, and sees a marketing opportunity for its new Texas Pit Barbecue restaurant. It has developed its marketing plan to include the type of products it will sell, the location for the restaurant, and the pricing it will use. Their plan includes a marketing objective to make a profit of 5% the first year of operation. So far, the owners of the restaurant have eliminated a key piece of the marketing plan, which is ______.
specifying how they will achieve their marketing objective
Based on the work by the Boston Consulting Group, products with a dominant share of the market and good prospects for growth are
stars
Kraft purchased the Duracell Battery Company and now operates this division as a separate profit center within the firm. In this example, Duracell is a(n) ___________ unit of Kraft.
strategic business
Within a business organization, a profit center that is self-supporting in terms of sales, markets, production, and other resources is known as a
strategic business unit.
Managers at the Littlefield Corporation are engaged in a complex process of revising their organization's mission and goals and developing corporate strategy, marketing objectives, marketing strategy, and, eventually, a marketing plan. This process is called
strategic planning
The fact that Southwest Airlines has a history of being able to retain its employees is a ___ in its SWOT analysis.
strength
John Deere's strong name recognition and solid customer demand for its farm and garden equipment are two elements of the firm's
strengths
An analysis of ___________ examines internal factors that give the organization certain advantages and disadvantages in meeting the needs of its target markets.
strengths and weaknesses
Successful business organizations should take actions to convert internal weaknesses into ___________ and external threats into ___________.
strengths; opportunities
A competitive advantage that cannot be readily copied by the competition is referred to as a(n) __________ advantage.
sustainable
Because of its highly efficient and low-cost distribution system, Walmart has a _________ advantage over Kmart.
sustainable competitive
Harley-Davidson's Harley Owner's Group (HOG) helps to foster strong relationships between riders and their motorcycles, giving it a(n) _____ over other motorcycle manufacturers.
sustainable competitive advantage
The college-aged student represents EXperience Limited's _____, and the tours its operates represent the ______ element of the marketing mix.
target market; product
Marketing managers at Consolidated Equipment Corporation are involved in establishing marketing performance standards, evaluating performance, and reducing the differences between actual and desired performance. These marketing managers are engaged in
the marketing control process.
A market opportunity results from
the right combination of circumstances and timing that permit an organization to take action to reach a particular target market.
In Southwest Airlines' SWOT analysis, the rising gas prices are a(n) ____, while the fact that other airlines are charging for all checked baggage may create a(n) ________,
threat; opportunity
A marketing unit can be organized according to functions, products, regions, and
types of customers
An appliance manufacturer that sells to large retail stores, wholesalers, and institutions would probably organize its marketing unit on the basis of
types of customers