MARK ch. 2
Which of the following actions, if it actually happened, would be the most likely to support and enhance an operational excellence macro strategy?
3M Corporation, implementing new software to improve communication with its suppliers
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.
Customer retention programs are based on what concept?
Customer relationships should be viewed from a lifetime value perspective.
The global athletic footwear market is expected to experience only very slow growth over the next several years. Nike is the market leader, with a market share of approximately 33 percent. 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 two to five percent over last year's sales at Stores 1 and 2 but fell two percent at Store 3. Based on this information, how should Marcia reward (or punish) her store managers?
She should seek more information about why the stores had different results before making a decision.
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
Nordstrom's, an upscale department store, has a well-known reputation for going the extra mile to serve its customers. This reputation for excellent customer service has probably resulted in
a sustainable competitive advantage
When a pharmaceutical company develops a new medication, it typically applies for a patent to prevent competitors from developing copycat products for several years. Pharmaceutical companies apply for patents to establish
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
In 2006, Walmart announced that it would begin selling organic food products. In doing so, Walmart was probably trying to
attract a different market segment
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
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 ten-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
Anita has gone to the same hair salon for the past ten 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
In mid-2010, Hewlett-Packard Company (HP) acquired Palm Computing, Inc., a manufacturer of personal devices and smart phones. 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
Many of today's college graduates will make their living providing goods and services to baby boomers, the large group of Americans born in the period after World War II. Baby boomers are a _________________ market segment.
demographic
Introducing newly developed products or services to a market segment the company is not currently serving is called
diversification
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
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
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 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 opportunities
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
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. The manager will probably next review the company's
implementation programs, to see if the promotion was handled consistently in the different stores.
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
The strategic marketing planning process
is not always sequential
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 pursuing which macro strategy?
locational excellence
Which of the following is LEAST likely to provide a sustainable competitive advantage?
lowering prices
Gerald's Tire Store sets itself apart from competitors by the extra attention it pays to 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 ___________________ to create and deliver value and to develop a sustainable competitive advantage.
macro, or overarching, strategy
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
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
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 established as one 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 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 which, 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
When pursuing a market development strategy, expanding into international markets is generally
more risky than expansion in domestic markets
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
Firms achieve ___________ through efficient procedures and excellent supply chain management.
operational excellence
For U.S. businesses with strong export capabilities, expansion of U.S. trade agreements with other countries creates
opportunities
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
In a SWOT analysis, increasing gasoline prices would represent a potential __________ for manufacturers of electric cars.
opportunity
After defining the business mission, what should a firm do next to develop a marketing plan?
perform a situation analysis
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
In recent years, cellular (mobile) service providers have worked hard to eliminate dead zones, providing customers with service wherever they traveled. By working to make the network available in more locations, cellular service companies were focusing on __________ value creation.
place
Delta Airlines is among the companies experimenting with selling products and services on its 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
Effective marketing doesn't just happen. It is
planned
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
Coca-Cola sells two zero-calorie versions of Coke: Diet Coke and Coke Zero. It has chosen to attempt to appeal to men with Coke Zero. In addition to launching an ad campaign featuring men enjoying Coke Zero, Coca-Cola also designed a masculine looking can for Coke Zero, with bold red lettering on a black background. This specially designed can is an example of
positioning
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
__________ 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
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
Imagine that you are in a convenience store choosing your favorite comfort food instead of being in a classroom taking this test. You might notice the packaging, colors, labels, even the fonts used on labels. All of these efforts are part of the marketer'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
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
For many years, because of the size of the U.S. economy, domestic companies ignored international markets, preferring instead to develop new product offerings for existing customers. These companies were pursuing a ________________ strategy.
product development
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 called her auto insurance agent to renew her policy. The agent told her about new types of insurance that are 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
When Nike, the prominent athletic shoe manufacturer, branched out from selling only athletic shoes to also offering athletic clothing and gym bags, what type of growth strategy did this represent?
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(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
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 to find jobs. This investment would enhance the university's _____________ in an attempt to create value for students and recent graduates.
product value
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
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.
Which of the following is NOT one of the four major growth strategies marketers typically use?
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
Taking steps to encourage customer loyalty is one way to
sustain an advantage over competitors
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 25-50-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
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
Allen is in the marketing department of a mid-sized firm that develops and sells communications systems. He is proud of the Human Resources 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 of 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 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 automobile production. For parts companies supplying Ford Motor, this represented a(n)
threat
In its discussion of Nike and adidas, two major athletic shoe manufacturers, the text mentions that Nike has purchased Umbro, a sports brand that has appealed mainly to soccer (European football) enthusiasts in the past. This action suggests that Nike intends to compete head to head with adidas, which got its start designing soccer shoes. On a SWOT analysis for adidas, how should Nike's acquisition of Umbro be categorized?
threat
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
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.
Over the past 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
The idea of value-based marketing requires firms to charge a price that
captures the value customers perceive that they are receiveing
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.
n value-based marketing, promotion communicates the ________ to customers through a variety of media.
value proposition
Kathy reviews her division's quarterly results and sees that some units exceeded goals while others did not. Next, she will attempt to determine why performance of the different units varied, and whether the variation
was due to factors within or outside the firm's control.
Manufacturers who 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
