BUS 350MCQ practice qns BUS350. 100% Correct Answers Indicated.

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1. Which level of strategy provides direction on the company's mission, the kinds of businesses it should be in and its growth policies? A. business-level strategy B. corporate strategy C. marketi... ng strategy D. service strategy 2. What component of strategy involves detailing the desired levels of accomplishment on one or more performance dimension over specified time periods for the organisation as a whole? A. scope of an organisation B. resource deployments C. identifying a sustainable competitive advantage D. goals and objectives of an organisation 3. What question needs to be specifically addressed while developing a business strategy? A. What business are we in? B. What business should we be in? C. What portion of our total resources should we devote to each business to achieve overall goals and objectives? D. What distinctive competencies can give the business unit a competitive advantage? 4. What is the primary focus of marketing strategy? A. decisions about the organisation's scope and resource deployments across divisions B. effective allocation and coordination of resources to meet organisational objectives within a specific product-market C. addressing which competitive advantage best matches the needs and wants of the customers in the target segment D. how a business unit competes within its industry 5. Which of the following falls within the scope of corporate strategy? A. target market definition B. vertical integration C. branding policies D. line extension6. Which observation concerning market-oriented firms is incorrect? A. They are characterised by a consistent focus on customers' needs by personnel in all departments. B. They adapt product offerings to the special needs of different target markets. C. They are slower and less willing to adapt products and functional programs to fit environmental changes. D. They adopt a variety of organisational procedures to improve the responsiveness of decision-making. 7. Why are early entrants into newly emerging industries, particularly industries based on new technologies, especially likely to be internally focused and not very market-oriented? A. strong competition during the formative years B. rapid growth in demand for the new product C. customer demand less than available supply D. resource constraints rarely an immediate threat to survival 8. The tendency for firms to automatically continue strategies that were successful in the past, even though current market conditions are changing, is referred to as: A. marketing myopia B. strategic inertia C. cognitive dissonance D. law of probability 9. Product-oriented firms: A. are primarily concerned with the marketing concept B. are likely to be internally focused C. have broad product lines D. consider credit a customer service10. Which of the following approaches characterises a production-oriented organisation? A. pricing based on perceived benefits provided B. applying new technology to satisfy customer needs C. company makes what can be sold D. primary focus on functional performance and cost 11. What characterises a market-oriented organisation? A. narrow product lines B. packaging designed for customer convenience C. technical research and focus on cost cutting in the production process D. emphasis on product features, quality and price 12. Dell attempted to maintain its long-standing low-cost position by reducing the number of technicians in its customer call centres. As a result, an increasing number of customers spent 30 minutes or more on hold before they found a technician to solve their problem. This affected Dell's customer satisfaction rating in the United States and its sales and profit growth stagnated. This scenario highlights: A. the increased importance of service B. strategic inertia C. the company's market-orientation focus D. the impact of information technology 13. Identify the incorrect statement concerning services. A. Services are the fastest-growing sector of developed economies. B. Good services improve customer loyalty over the long term. C. The intangible nature of services creates unique challenges for marketers. D. Efficient services are always tied to a physical product.14. E-tailers such as Amazon and iTunes are examples of firms in this ecommerce category: A. business-to-business B. consumer-to-business C. business-to-consumer D. consumer-to-consumer 15. Marketers have identified 4Cs critical to a good strategic marketing plan. Which of the following is not one among them? A. company B. context C. contacts D. customers 16. A distinct subset of people with similar needs, circumstances and characteristics that lead them to respond in a similar way to a particular product or service offering is known as a: A. market segment B. target market C. penetrated market D. marketing mix 18. Research indicates that the general influence of marketing managers on higher-level strategic decisions has: A. remained negligible in comparison to managers from other departments such as finance and operations B. been welcomed by governments as a move toward greater market efficiency C. increased significantly in recent years and is particularly noticeable in countries like the US D. increased significantly in recent years and is particularly noticeable in countries like Germany19. The marketing concept was originally developed by: A. Motorola B. Philip Kotler C. The American Marketing Association D. General Electric 20. Changes in the environment that are rapidly altering the way marketing strategies are planned include the following: A. globalisation and Americanisation B. globalisation and information technology C. globalisation and terrorism D. globalisation and the ageing workforce 21. What are the major parts to a marketing plan? A. assessment of current situation, strategy for coming period, financial and resource implications B. executive summary, SWOT, competitor analysis C. assessment of current situation, product development, competitor analysis D. executive summary, market audit, controls 22. Market orientation should generally be the main goal for organisations because: A. once you achieve market orientation, no other competitor can also become market-oriented B. market orientation generally provides superior performance C. market orientation protects against imports D. market orientation makes advertising your products cheaper 23. A marketing plan is vital for an organisation as the plan can be regarded as: A. protection against competitors B. a blueprint for action C. a standard practice and procedure D. a document to show customers1. What is not true of the criteria for defining a corporate mission? A. Basic customer needs tend to change over time but products endure. B. Many firms specify their domain in physical terms. C. Statements focusing only on basic customer needs can be too broad to provide clear guidance. D. Statements that specify domains in physical terms can lead to slow reactions to customer demand changes. 2. The most useful mission statements focus on being: A. functional and broad B. physical and specific C. functional and specific D. physical and broad 3. In expressing corporate objectives aimed at enhancing shareholder value, a firm combining its debt and market value of its stock and then subtracting the capital invested in the company, is using the _____ approach. A. return on capital B. economies of scale C. market value added D. cash conversion cycle 4. The profitability criterion is measured in terms of which of the following indexes? A. percentage change in sales B. return on net assets C. price/earnings ratio D. percentage cost savings from new processes5. Standard accounting measures such as earnings per share or return on investment are: A. not always reliably linked to the true value of a company's stock B. objectives that always provide adequate guidance for a firm's lower-level managers C. fool-proof tools available to evaluate the future impact of strategic actions on shareholders D. objectives that consistently set benchmarks for accurately evaluating performance 6. Standard accounting measures such as earnings per share or return on investment are: A. not always reliably linked to the true value of a company's stock B. objectives that always provide adequate guidance for a firm's lower-level managers C. fool-proof tools available to evaluate the future impact of strategic actions on shareholders D. objectives that consistently set benchmarks for accurately evaluating performance 7. A survey on customer feedback for an industrial paper company found that about 80 per cent of customers' satisfaction scores were accounted for because of order processing, delivery and post-sale services. This finding substantiates which of the following statements? A. Customer satisfaction increases due to the product-oriented approach. B. Spending more on emphasising product features creates a sustainable competitive advantage. C. Customer satisfaction is influenced by factors other than the product itself. D. Pricing is based on production and distribution costs.8. A sustainable competitive advantage at the corporate level is based upon: A. pure luck B. spending more on advertising than your competitors C. business resources that other businesses do not have, take a long time to develop and are hard to acquire D. introducing a new product every few months 9. A company trying to increase its market share for its current products is most likely to follow which of the following strategies? A. diversification B. market penetration C. market development D. product development 10. Amazon.com pursued a combination of actions, such as making service improvements and cutting costs, as well as forming alliances with web portals to expand its share of online shoppers, even though the expense of such activities postponed the firm's ability to become profitable. This is an example of expansion by: A. diversifying B. selling existing products to new segments C. developing new products for current customers D. increasing market penetration of current product 11. Telstra successfully entered the mobile phone market by initially targeting its landline customers, taking advantage of its extensive infrastructure and experience in telephony. This example illustrates the use of a: A. market penetration strategy B. diversification strategy C. product development strategy D. market development strategy12. Theatres, orchestras and other performing arts organisations often reach audiences outside major metropolitan areas by promoting matinee performances with lower prices and free public transportation to attract senior citizens and students. Identify the strategy being employed in this case. A. expansion by diversifying B. expansion by selling existing products to new segments C. expansion by developing new products for current customers D. expansion by increasing penetration of current product-markets 13. Theatres, orchestras and other performing arts organisations often reach audiences outside major metropolitan areas by promoting matinee performances with lower prices and free public transportation to attract senior citizens and students. Identify the strategy being employed in this case. A. expansion by diversifying B. expansion by selling existing products to new segments C. expansion by developing new products for current customers D. expansion by increasing penetration of current product-markets 14. A manufacturer is moving downstream in terms of product flow by launching a chain of retail outlets. Which diversification strategy is being used by the company? A. forward vertical integration B. elated diversification C. backward integration D. conglomerate diversification 15. Faced with a decline in its current business, a generic drug manufacturer is planning a foray into design, and manufacture of re-locatable modular structures. Which diversification strategy is being employed by the company? A. Related diversification B. Backward integration C. Forward vertical integration D. Unrelated diversification16. Which of the following is a limitation of the growth–share matrix? A. Since the matrix uses multiple variables as a basis for categorising a firm's business, it is complex to understand. B. Outcomes of this analysis are highly sensitive to variations in how growth and share are measured. C. The matrix is unable to analyse the impact of investing resources in different businesses on the firm's future earnings. D. The model fails to consider that firms can generate cash from businesses with strong competitive positions in mature markets. 17. Which of the following is a limitation of the growth–share matrix? A. Since the matrix uses multiple variables as a basis for categorising a firm's business, it is complex to understand. B. Outcomes of this analysis are highly sensitive to variations in how growth and share are measured. C. The matrix is unable to analyse the impact of investing resources in different businesses on the firm's future earnings. D. The model fails to consider that firms can generate cash from businesses with strong competitive positions in mature markets. 18. Cash cows are: A. businesses with a high relative share of low-growth markets B. low-share businesses in low-growth markets C. the market leaders in a high-growth industry D. businesses in high-growth industries with low relative market shares 19. Dogs are: A. businesses with a high relative share of low-growth markets B. low-share businesses in low-growth markets C. the market leaders in a high-growth industry D. businesses in high-growth industries with low relative market shares20. Identify the incorrect statement concerning alternative portfolio models. A. They are more useful for evaluating potential new product markets. B. They are multifactor models and are more detailed than the simple growth–share model. C. They provide more strategic guidance concerning the appropriate allocation of resources across businesses. D. They provide the best measures when managers must evaluate different industries on the same set of factors. 21. Identify the incorrect statement concerning alternative portfolio models. A. They are more useful for evaluating potential new product markets. B. They are multifactor models and are more detailed than the simple growth–share model. C. They provide more strategic guidance concerning the appropriate allocation of resources across businesses. D. They provide the best measures when managers must evaluate different industries on the same set of factors. 22. In the industry attractiveness–business position matrix: A. size and growth are criteria used to determine the business's competitive position B. relative share is more important than patents C. price levels and profitability require a harvest/divest strategy D. competitive intensity and profitability are two of the factors that assist determine industry attractiveness 23. Identify a limitation of value-based planning. A. It attempts to assess the economic value a given strategy is likely to create by relying on distorted accounting measures. B. It is mainly a tool for evaluating strategy alternatives identified and developed through managers' judgments. C. It is unable to assess the shareholder value a given strategy is likely to create. D. It is unable to provide a basis for comparing the economic returns to be gained from investing in different businesses.24. Which of the following are the least desirable from a firm's portfolio management perspective? A. stars B. dogs C. cash cows D. question marks 25. A firm's ability to attract debt financing depends first and foremost on: A. its reputation B. projections of how much cash it can generate in the future C. projections of the degree of customer satisfaction it can generate D. its existing brand equity 26. A firm's ability to attract debt financing depends first and foremost on: A. its reputation B. projections of how much cash it can generate in the future C. projections of the degree of customer satisfaction it can generate D. its existing brand equity 27. A firm's ability to attract debt financing depends first and foremost on: A. its reputation B. projections of how much cash it can generate in the future C. projections of the degree of customer satisfaction it can generate D. its existing brand equity 28. Amazon.com's substantial expenditures on warehousing and order fulfilment activities were investments that earned the loyalty of existing customers. This is typical of a: A. market penetration strategy B. diversification strategy C. customer orientation strategy D. customer development strategy29. In the BCG matrix: A. the vertical axis indicates market growth rate B. the vertical axis indicates the relative market share of the business C. the horizontal axis indicates market growth rate D. the horizontal axis indicates market attractiveness 1. Strategic business units: A. are primarily alliances with other competitive firms aimed at new markets B. are components of a firm engaged in multiple industries or businesses C. adapt the same growth objectives and competitive strategies as other SBUs D. are business units that always focus on competing within their industry 2. Which of the following is not a dimension that defines the scope and mission of an individual SBU? A. technical compatibility B. similarity of competitors C. similarity of customer needs D. similarity of personal characteristics of customers in the target markets 3. A firm ensures that no two SBUs within the firm compete for the same customers with similar products. Which SBU characteristic is being discussed here? A. a homogeneous set of markets to serve with a limited number of related technologies B. controlling factors that are essential for successful performance C. a unique set of product markets D. responsibility for their own profitability4. 3M consumer product group introduced Scotch-Brite Never Rust soap pads made from recycled plastic beverage bottles. Its objective was to capture a major share of the soap pad market and maximise Never Rust's volume growth. The firm's top managers approved a major investment in a new plant and a substantial introductory advertising budget. At the same time, the consumer group maintained high profitability goals for its other established products to provide the cash required for Never Rust's introduction and preserve the group's overall profit level. Identify the business strategy employed here. A. A firm breaking down its corporate objectives into subobjectives for each SBU. B. A firm's subobjectives are consistent across the various SBUs. C. A firm's subobjectives are used only for the existing product market within the unit. D. A firm using value-based planning as a tool for evaluating alternative resource allocations. 5. According to Michael Porter, a business that avoids direct confrontation with its major competitors by concentrating on narrowly defined market niches is using the ______ strategy to gain and maintain competitive advantage. A. overall cost leadership B. differentiation C. focus D. segmenting 6. A business pursuing a prospector strategy: A. concentrates on maintaining its positions in established product markets while paying less attention to new product development B. focuses on growth through the development of new products and markets C. attempts to maintain a strong position in its core product markets but also seeks to expand into new product markets D. does not have a clearly defined strategy7. Which business strategy is followed by a business that attempts to maintain a strong position in its core product market but also seeks to expand into new— usually closely related—product markets? A. prospector strategy B. analyser strategy C. low-cost defender strategy D. reactor strategy 8. Businesses following a reactor strategy: A. attempt to maintain a stable line of products, but follow a selected set of promising new developments in its industry B. try to protect their domain by offering lower prices, higher quality or better services than competitors C. are not as willing to assume the risks of a new product or market development as its competitors D. respond rapidly to early signals concerning areas of opportunity, which often lead to new rounds of competitive actions 9. 42BELOW—a wheat vodka made by a small distillery in New Zealand—has captured a share of the prestige segment of the market, especially hotels such as the Ritz in London and El Bulli in Spain. Identify the strategy used by the firm. A. prospector strategy B. differentiated defender strategy C. low-cost defender strategy D. reactor strategy 10. Which of the following observations is not true of services? A. They can be thought of as intangibles. B. Intangibles can rarely be experienced in advance of the sale. C. They can be tested even before purchase. D. Almost all businesses are engaged in service to some extent.11. The strategic decision to reposition Emirates as a global carrier is regarded as a threat to existing global carriers because: A. air travellers can now by-pass traditional airline hubs such as London–Heathrow, Paris– CDG and Frankfurt on their way between Europe and North America. B. Emirates flies to every international airport in the world. C. Emirates will now have a monopoly on global aviation. D. Emirates provides better in-flight entertainment than competitors.12. A key strategic characteristic of Huawei is that: A. around 46% of its employees are engaged in research and development B. it out-sources research and development C. it tends to be a follower, hence does not need much research and development D. little public information is known about the amount of research and development it conducts 13. Considering scope, these businesses usually operate in broad and rapidly changing domains where neither the technology nor customer segments are well established. A. prospector B. differentiated defender C. low-cost defender D. analyser 14. Which performance dimension is usually measured by the number of successful new products introduced relative to competitors or the percentage of sales accounted for by products introduced within the last five years? A. efficiency B. effectiveness C. durability D. adaptability 15. Which of the following best describes the effectiveness performance dimension? A. the success of a business's products and programs relative to those of its competitors in the market B. the outcome of a business's programs relative to the resources used in implementing them C. the business's success in responding over time to changing conditions and opportunities in the environment D. the percentage of sales accounted for by products introduced within the last five years 16. Emerson Electric formed an operating group of several otherwise autonomous business units that make different types of electrical motors and tools. By sharing production facilities, marketing activities and a common sales force, the group was able to reduce the costs of both per-unit production and marketing. Emerson Electric is trying to: A. gain operating synergies through sharing resources B. preserve its position in established product markets C. generate excess cash to support its product and market development efforts D. devote a proportion of resources to the development of new product markets17. Which environmental factor is conducive to the prospector strategy? A. industry in early growth stage B. industry in late growth or early maturity stage C. industry in maturity stage D. industry in decline stage 18. The defender strategy is most useful: A. for business units with a profitable share of one or more major segments in a relatively mature and stable industry B. for business units that try to avoid being left behind in newly developing application segments within the market C. for well-developed units that are still experiencing some growth and change as a consequence of evolving customer needs D. for unstable units due to fewer competitors and their relative market shares that shift rapidly as new products are introduced 19. A policy of high service quality is essential for _____, as it offers a way to maintain a competitive advantage in well-established markets. A. prospectors B. low-cost defenders C. differentiated defenders D. analysers 20. Identify the correct statement concerning the distribution policies. A. Prospector's need for motivation of distribution channel members is accomplished through tight control of business-owned channels. B. Maintaining tight control over the behaviour of channel members is an appropriate policy for prospectors who rely on customer service. C. Defenders are likely to devote a larger percentage of sales to trade promotions than the prospector businesses. D. Defenders rely on trade promotion tools and other incentives to induce support from their independent channel members.21. When the Pillsbury Company rejected the proposal of their employee James D. Watkins that microwavable packaged food was too risky, it was focused on defending its strong position in the marketplace through incremental line extensions and product improvements. This is typical of a(n): A. prospector strategy B. reactor strategy C. analyser strategy D. diversification strategy 22. Which of the following are most likely to be involved in a strategy of high forward vertical integration with regards to their distribution policies? A. differentiated defenders B. diversified prospectors C. customer-oriented analysers D. All of the given answers are correct. 23. Emirates Airline has been classified as a differentiated analyser because: A. it offers a high level of customer service while charging a price premium B. it has differentiated its service offering to include hotels and resorts around the world C. it pursues both established and new markets D. it is consistently at the forefront in opening new destinations while closing down old ones 1. A(n) _____ is composed of individuals and organisations who are interested in, and are willing to buy, a good or service to obtain benefits that will satisfy a particular need. A. sector B. channel C. industry D. market 2. A micro-level analysis of market and industry attractiveness is based on: A. the industry as a whole B. the market as a whole C. environmental conditions that affect the market D. specific target customers3. Identify a demographic trend that influences market attractiveness. A. fitness and nutrition B. increased levels of immigration C. business ethics D. deregulation in a firm's operation 4. Marketers of such consumer services as health care, holiday accommodation and life insurance are capitalising on the general trend of an ageing population and are developing and implementing marketing strategies accordingly. What macro-environmental trend is acting as a catalyst here? A. technological B. ecological/natural C. sociocultural D. population/demographic 5. Identify a sociocultural environment trend that affects market attractiveness. A. declining marriage rates B. increased levels of immigration C. imbalanced population growth D. fitness and nutrition 6. Each macro-environmental trend has a distinct impact on the consumer and industrial market. Identify the scenario where industries such as check-cashing outlets and pawn shops will face a tough time staying in business. A. increased immigration B. robust economy C. deregulation D. ageing population 7. Deregulation: A. protects inefficiencies B. creates rapid growth in some markets C. creates inflationary pressures D. restricts entry by new competitors8. The rise in production of products such as hybrid gas-electric vehicles, phosphate-free detergents and high-efficiency light bulbs is indicative of the impact of which of the following macro-environmental force? A. ecological/natural environment B. technological environment C. regulatory environment D. economic environment 9. According to Porter's five competitive forces, rivalry among present competitors is greater under which of the following conditions? A. when strong economies of scale and learning effects are present B. when low switching costs exist for the buyers C. when suppliers can realistically threaten forward integration D. when strong product differentiation exists among current players 10. Porter's five competitive forces model identifies rivalry among present competitors as one competitive force. According to this concept, why would the restaurant industry face greater rivalry? A. because of the absence of a dominant firm< B. because of high investment intensity C. because of little product differentiation D. because of low switching costs for buyers 11. The problem of overcoming a cost disadvantage becomes more difficult for existing firms that share their output with their related businesses: A. if gaining distribution is particularly difficult B. when strong product differentiation exists among current players C. if the industry has strong capital requirements at the outset D. when strong economies of scale and learning effects are present12. The bargaining power of suppliers increases under all of the following conditions except: A. if the cost of switching suppliers is high B. if prices of substitutes are high C. if suppliers can realistically threaten backward integration D. if the supplier's product is a large part of the buyer's value added 13. A distribution agency was using facsimile machines to send and receive longdistance messages. This was replaced with an all-in-one printer, flatbed scanner, copier and fax device that allowed the agency to accomplish multiple tasks at the same price. For the manufacturer of the facsimile machines, this example represents the: A. entry barrier for companies B. bargaining power of buyers C. threat of substitute products D. rivalry among present competitors 14. Most companies and most goods deliver generic category benefits when: A. The offering provides customer benefits that other solutions do not B. The threat of backward integration exists C. There is little product differentiation D. The amount of fixed and working capital required to produce a dollar of sales is large. 15. Opportunities are attractive at the micro level for the industry when the company meets which of the following tests? A. The target market is likely to grow. B. The source of customer pain and ability to resolve it has been identified. C. The offering provides customer benefits that other solutions do not. D. The company possesses something proprietary that is not easily duplicable.16. Which of the following factors is considered a critical success factor in the case of retailing? A. price B. location C. promotion D. product 17. According to the opportunity/threat matrix, which of the following events should be closely monitored? A. events with a low probability of occurring and having a low impact B. events with a high probability of occurring and having a high impact C. events with a low probability of occurring and having a high impact D. events with a high probability of occurring and having a low impact 18. When large music record companies such as Sony, Warner Music and Universal decided that they would make thousands of songs available for download over the internet, this was a clear strategic response to changes in the: A. sociocultural environment B. economic environment C. technological environment D. political environment 19. What does it mean when firms create new market space? A. Firms begin to vertically integrate by acquiring their competitors, thus freeing up market space. B. Firms start looking across substitute industries or to complementary product and service offerings that go beyond what an industry has traditionally offered. C. Firms outsource their operations to low-cost labour locations in order to cut costs. D. Firms pursue a defender strategy by establishing strategic alliances with competitor firms in order to secure new market space.20. Which one of the below is not a part of the three team domains? A. mission, aspiration, and propensity risk B. ability to execute CSFs C. connectedness up, down and across the value chain D. strategic synergies between functional units within the firm 21. Consumers are prepared to pay a premium for what they believe to be ______ business practices. A. questionable B. competitive C. old-fashioned D. ethical 22. A trend towards cashless shopping is due to advances within the ______ environment. A. population/demographic B. sociocultural C. economic D. technological 23. For a business operating within a specific industry, the bargaining power of suppliers is increased when ______. A. the cost of switching suppliers is high B. there are many substitutes C. suppliers cannot threaten forward integration D. the supplier's product is only a small part of the buyer's value added 24. In the context of analysing market opportunities, ‘CSF' stands for ______. A. crucial sale figures B. critical sales forecast C. calculated sales factors D. critical success factors25. The growing tendency of businesses to champion their commitment to environmentally sustainable business practices is a result of changes and trends in the: A. technological environment B. sociocultural environment C. population/demographic environment D. economic environment1. What term is used to refer to the size of current users who are already using a particular product at the time of forecast? A. target market B. penetrated market C. market potential D. test market 2. Which of the following statements is true of the top-down approach in sales forecasting? A. A central person or persons takes the responsibility to prepare an overall forecast. B. Once each part of the firm prepares its own sales forecast, the parts are aggregated to create the forecast as a whole. C. Firms can break their anticipated demand into pieces and sum the components to create the summary forecast. D. Various combinations of market segments and/or product lines can be combined to build a business plan that looks viable. 3. Statistical methods are not recommended for new product managers charged with forecasting sales for a new product because: A. here is no history in their venture on which to base a statistical forecast. B. These methods tend not to base their assumption of the future on the past. C. It does not include a method to forecast the impact on consumer demand of different combinations of attributes. D. It is not based on what people actually do. 4. Company A is a tyre manufacturer and uses factors like the number and age of vehicles currently on the road in the country, predictions of GDP for the region and other relevant factors to forecast market potential. Which of the following methods is the one Company A uses for a more accurate forecast? A. analogy B. statistical method C. observation D. surveys 5. For which category of new products is the observational method of preparing an evidence-based forecast not possible? A. new product lines B. improvements in or revisions of existing products C. new-to-the-world products D. repositioning6. Honeydew, a well-known confectionery, plans to introduce a walnut fudge candy. It asks some of its regular customers to sample it and provide their opinion. In this way, the management hopes to estimate the likely number of buyers for the product, if introduced in their store. Honeydew used the _____ method of forecasting. A. survey B. judgment C. statistical D. analogy 7. Which of the following observations is not applicable to the analogy approach of forecasting sales? A. It allows for comparison of similar available historical data for any particular product. B. It uses a behavioural approach to estimate future sales patterns and likely customers. C. It is an approach often used to forecast the sales or market potential for a new product. D. It allows managers to look at the sales history of earlier introductions to forecast the sales for the new product. 8. Which of the following is not a valid reason for the decline in the use of live test markets? A. They are expensive to conduct. B. Competitors can buy checkout scanner data without bearing test marketing expenses. C. Differences exist between what people imagine about a product in a test market and what is actually delivered. D. Competitors engage in marketing tactics to mislead the company by distorting normal purchasing patterns in a category. 9. Diffusion of innovation theory allows: A. marketers to estimate how rapidly an innovation is likely to be adopted by the target market B. consumers to gauge the feasibility of product acceptance within their reference groups C. management to estimate how quickly innovation can seep into an organisational culture D. marketers to manipulate customer attitudes from the time they first hear about the new product until they adopt it 10. The speed of the adoption process is based upon all of the following except: A. relative simplicity of the new product B. ease with which the central idea of the new product is communicated C. extent to which its trial can be accomplished on a large-scale basis D. relative advantage of the new product over other products11. The late majority are individuals who: A. adopt a new product for economic or social reasons B. are more likely to be receptive to new ideas C. are the most 'local' and stubbornly resist change D. want to be sure that a new product will prove successful before adopting it 12. Nine West Retail Stores is an international operator of shoe specialty stores. Each week, all Nine West retail outlets receive information about the fastest and slowest selling items in terms of style and colour; merchandise category (e.g. dress or casual); store, area or region; and for various time periods. This is an example of the use of: A. marketing databases B. competitive intelligence systems C. internal records systems D. client contact and sales force automation systems 13. Company A uses loyalty cards to track and analyse customer buying patterns and to offer customers coupons and incentives tailored to their buying behaviour. Which of the market knowledge systems does the company use? A. marketing databases B. competitive intelligence systems C. internal records systems D. client contact and sales force automation systems 14. What system of information collection best illustrates a marketing database? A. 'cookies' or electronic signatures placed at a customer's personal computer B. detailed sales and inventory about the fastest-selling items in a particular store C. companies' annual and other financial reports, and government documents D. customer information captured from sales persons 15. Which of the following statements about competitive intelligence systems is incorrect? A. It is a systematic and ethical approach for gathering and analysing information about competitors' activities and related business trends. B. It is based on the idea that more than 80 per cent of all information is public knowledge. C. It uses online databases, government documents, etc. as its source of information. D. It allows the effective capture of customer intelligence from salespeople and account transfers.16. Sales force automation software helps companies to: A. gather and analyse information about competitors' activities and related business trends B. disseminate real-time product information to salespeople to satisfy customer needs C. record annual reports, other financial reports, online and government databases D. keep track of information about which goods or services were sold from which region 17. The design, collection, analysis and reporting of research intended to gather data pertinent to a particular marketing challenge or situation is referred to as: A. data mining B. marketing research C. marketing databases D. project research 18. ‘Primary data collected when cheaper and faster secondary data will do. Quantitative data collected without first collecting qualitative data.' These are examples of things that could go wrong in which step of the marketing research process? A. reporting results to the decision-maker B. determining data sources and types of data and research approaches required C. designing research: type of study, data collection approach, sample, etc. D. identifying managerial problem and establishing research objectives 19. Heavy deregulation in the Australian telecommunications industry has resulted in: A. a monopoly in which one major player controls the entire industry B. the growth in substitute products to compete with telecommunications C. intensified competition and ‘price wars' for telecommunications products and services D. a primary focus on augmented services such as warranties and after-sales support for telecommunications products and services20. Which of the below is not a major evidence-based method for estimating market potential and forecasting sales? A. statistical methods B. market tests C. marketing plans D. focus groups 21. Chain ratio calculations and indices are both examples of: A. mathematical approaches in forecasting B. standards used for cross-market analysis C. approaches used to assess the generic value chain D. systems applied in data-mining software to enable informed decision-making 22. When estimating market potential using indices, 'BPI' stands for ______: A. Buying Power Index B. Best Potential Index C. Brand Potential Index D. Beneficial Purchasing Index 23. Which of the following statements is correct? A. During the adoption process, interest occurs before trial. B. During the adoption process, potential buyers evaluate before developing interest. C. During the adoption process, trial is the last of the five stages. D. During the adoption process, consumers often evaluate before acquiring awareness. 24. Innovators typically account for approximately what percentage of all individuals who ultimately adopt a new product? A. the last 10% B. the middle 50% C. the first 25% D. the first 2.5%25. If you are generally the last person amongst your social group to purchase a new product, you would be regarded as a(n) ______?< A. laggard B. innovator C. learner D. late majority member 1. Identify the process by which a market is divided into distinct subsets of customers with simi needs and characteristics that led them to respond in similar ways to a particular product offering and marketing program. A. target marketing B. market segmentation C. product positioning D. diversification 2. Which of the following involves evaluating the firm's mission and capabilities to deliver what each segment wants, in order to choose which segments it will serve? A. market penetration B. market segmentation C. product development D. target marketing3. If in a certain country the population growth has slowed and more product markets are maturing, the result is most likely to be one of: A. intense competition and increase in brand extensions B. lower competition among products within a single market segment C. multimillion-dollar businesses that serve large market segments D. many new media that appeal to broad and wide interest groups 4. The competitive environment in some industries is witnessing developments such as build-to-order processes, mass-customisation of products and computer-aided design technology. What reason can be attributed to the rising importance of marketing segmentation in such an environment? A. Population growth has increased, and more product markets are maturing. B. Social and economic forces have resulted in customers with less disposable income. C. An increasing trend toward microsegmentation exists in which extremely small market segments are targeted. D. Competitive inertia during the market shakeout period as the market transitions from product maturity to the decline stage. 5. Which of the following is not an objective entailed in the market segmentation process? A. identifying a homogeneous segment that differs from other segments B. specifying criteria that define the segment C. developing strategic alliances in the decline stage of the product D. determining segment size and potential 6. All of the following are reasons why the segmentation criteria should describe the market segments clearly except: A. members can be readily identified and accessed B. marketers need to know whether a given prospective customer is or is not in the target market C. to analyse customers' likely responses to differences in the elements of the marketing mix D. to reach the prospective customer with advertising or other marketing communication messages7. Which of the following statements emphasises the impact of income in segmenting markets geographically? A. Mobile service providers are focusing attention on the 65-plus segment to improve penetration. B. Toyota has launched an online information service aimed at women as they directly influence 8 out of 10 vehicle purchases. C. Nokia has launched a subsidiary to create an ultra-exclusive mobile telephone targeting customers buying prestige products. D. The increase in the number of working women has created needs for specialised goods and services. 8. Which of the following statements about geographic segmentation is incorrect? A. It is used only in consumer markets B. It is used when customers are unwilling to travel very far to obtain the goods they require. C. It is particularly important in retailing and many services businesses. D. It is helpful as regions vary in their sales potential, customer needs, etc. 9. Market segmentation: A. is the process by which a market is divided into distinct subsets of customers with similar needs and characteristics B. should only be utilised in developed countries C. is not conducted until after targeting has been conducted D. is conducted after positioning has been conducted 10. Which of the following illustrations exemplifies behavioural segmentation? A. Uni-Marts, a convenience store operator, focuses on small towns and rural areas, thereby avoiding big competitors. B. In the United States, car companies have found ways to cater to the needs of the multicultural segment. C. The sales of certain kinds of products such as trade magazines are tied closely to occupational type. D. Over the years, Volvo has emphasised safety whereas Jaguar has emphasised styling, quickness and status.11. Consumers evaluate product or brand alternative on the basis of desired characteristics and how valuable each characteristic is. This is referred to as the: A. purchase influence for the product B. buying situation for the consumer C. choice criteria of the consumer D. centralised purchasing structure 12. Principle-oriented consumers are consumers who: A. are motivated by abstract and idealised criteria for products or services B. shop for products that demonstrate the consumer's success C. are guided by the need for social or physical activity, variety and risk taking D. provide consumer-inputs to marketers during product development 13. _____ will influence a buyer to consider all transactions with a given supplier on a global basis, to emphasise cost savings and minimise risk. A. Benefits sought B. Purchasing structure C. Average income D. Purchase influence 14. Which of the following occurs when some element, such as price or delivery schedules, has changed in a client–supplier relationship? A. straight rebuy B. new task rebuy C. modified rebuy D. new buying situation 15. All of the following are benefits managers gain from applying a common analytical framework across segments to evaluate the potential of alternative market segments except: A. to compare the future potential of different segments using the same set of criteria B. to prioritise different segments to decide which segments to target C. to analyse how resources and marketing efforts should be allocated D. to portray how different segments represent equally attractive opportunities16. Which of the following marketing questions underlines the market– attractiveness of a firm? A. Are there unmet or underserved needs we can satisfy? B. Can we perform against critical success factors? C. Stage of competing products in product life cycle: is the timing right? D. Can we differentiate? 17. Possible shifts in customer needs and behaviour, the entry or exit of competitors and changes in their strategies are considered during this step of constructing a market-attractiveness–competitive-position matrix for evaluating potential target markets. A. select market-attractiveness and competitive-position factors B. project future position for each segment C. rate segments on each factor and plot results on matrices D. weigh each of the market-attractiveness and competitive-position factors 18. Identify the action point that a firm must take when the market attractiveness is moderate and the competitive position is weak. A. attempt to expand without high risk or minimise investment and focus on operations B. invest to improve position only in areas where the risk is low C. emphasise profitability by increasing productivity and build up ability to counter competition D. seek ways to increase current earnings without speeding market's decline 19. A key strategic issue in global market segmentation has been: A. to view a country as a single segment comprising all consumers, but this approach is seriously flawed B. ensuring that sales to developing countries have precedence over sales to developed countries C. to target low-population countries D. to ensure that market entry into a new country always utilises a price penetration strategy20. A strategy designed to avoid direct competition with larger businesses that are pursuing bigger segments is known as a: A. niche-market strategy B. vertical integration strategy C. broader large-market strategy D. growth-market strategy 21. The Nielsen PRIZM service is a tool used by market researchers to examine and identify which of the following? A. buying intention of teenagers B. social class C. keywords appearing in blogs and online communities D. race 22. Most successful entrepreneurial ventures target narrowly defined market segments at the outset because: A. most entrepreneurs are risk-takers who are naturally disposed to seek differentiated market opportunities B. narrowly defined market segments are increasingly attractive due to the availability of modern technology C. start-up costs are typically lower in narrowly defined markets as a result of underexposure and green field advantages D. doing so puts the nascent business in a position to achieve early success in a market segment that it understands particularly well 1. Identify the incorrect statement concerning positioning. A. It comprises both competitive and customer needs considerations. B. This concept is applicable only for an existing brand. C. It is essentially concerned with differentiation. D. Generally, it is more difficult for marketers to position services than goods successfully. Bloom's: Comprehension Difficulty: Easy Learning Objective: 7.1 Understand the concepts of positioning and differentiation. Section: Fast food turns healthy2. A company with a broad target aimed at gaining a competitive advantage through lower costs will use a: A. differentiation-based focus strategy B. differentiation strategy C. cost leadership strategy D. cost-based focus strategy Bloom's: Application Difficulty: Medium Learning Objective: 7.2 Identify generic competitive strategies. Section: Differentiation in business strategies 3. Physical positioning helps in all of the following ways except: A. It enables buyers to evaluate industrial goods and services on the basis of what it does rather than on what it is. B. It contributes to a better marketing-research and R&D interface by determining key physical product characteristics. C. It helps define the structure of competition by revealing the degree of competitiveness between various brands. D. It may indicate the presence of meaningful product gaps and thus reveal opportunities for a new product entry. Bloom's: Analysis Difficulty: Medium Learning Objective: 7.3 Appreciate the difference between physical and perceptual positioning. Section: Physical positioning 4. Michael Porter identified three generic business strategies. These are: A. cost leadership, differentiation, focus B. cost leadership, positioning, focus C. strategic intent, differentiation, cost leadership D. segmentation, targeting, positioning Bloom's: Knowledge Difficulty: Medium Learning Objective: 7.2 Identify generic competitive strategies. Section: Differentiation in business strategies5. Michael Porter's generic business strategies are based on two broad needs (attributes) and on the size of the market segment. The two broad attributes are: A. cost and differentiation B. cost and positioning C. positioning and product style D. segmentation and targeting Bloom's: Knowledge Difficulty: Hard Learning Objective: 7.2 Identify generic competitive strategies. Section: Differentiation in business strategies 6. Identify a limitation of physical positioning. A. It ignores the early stages of identifying new product offerings. B. Competitive offerings of many industrial goods and services cannot be typically evaluated on the basis of physical characteristics. C. They are rarely useful in undertaking a positioning analysis because they are based primarily on technical rather than on market data. D. Customers' attitudes toward a product are often based on social or psychological attributes. Bloom's: Evaluation Difficulty: Hard Learning Objective: 7.3 Appreciate the difference between physical and perceptual positioning. Section: Physical positioning 7. Which of the following is a characteristic of physical positioning? A. large number of dimensions B. consumer orientation C. represents impact of product specs D. represents impact of communication Bloom's: Knowledge Difficulty: Medium Learning Objective: 7.3 Appreciate the difference between physical and perceptual positioning. Section: Physical positioning8. ‘Some people will pay considerably more for Bayer aspirin than for an unadvertised private label aspirin, even though they are essentially the same product.' What does this statement signify? A. Consumers often know a lot about the essential physical attributes of many products, especially household products. B. Consumers generally understand the physical attributes well enough to use them as a basis for choosing between alternatives. C. Consumers often evaluate goods and services on factors other than physical properties, including their past experiences. D. Consumers can typically evaluate a product better on the basis of what it is than what it does. Bloom's: Analysis Difficulty: Medium Learning Objective: 7.3 Appreciate the difference between physical and perceptual positioning. Section: Perceptual positioning 9. Which of the following examples best illustrates perceptual positioning? A. Kellogg's breakfast cereal in new chocolate and honey flavours B. Volvo's latest SUV featuring 225 horsepower and a fuel efficiency of 7.65 kilometres per litre C. L'Oreal's new range of water resistant lipstick in fruit flavours D. Colgate's toothpaste with enhanced freshness of breath and sparkly teeth Bloom's: Evaluation Difficulty: Easy Learning Objective: 7.3 Appreciate the difference between physical and perceptual positioning. Section: Perceptual positioning 10. Marketing decision-makers, while seeking to win a particular position in a customer's mind, endow their product with various kinds of attributes. The speed of a computer system, the roominess of a car, and a product's or service's being user-friendly are examples of which type of categorisation based on such attributes? A. simple physically based attributes B. complex physically based attributes C. essentially abstract attributes D. price Bloom's: Application Difficulty: Medium Learning Objective: 7.3 Appreciate the difference between physical and perceptual positioning. Section: Levers marketers can use to establish positioning11. A firm is considering introducing a new product category in a highly competitive environment. The marketers obtain customer perceptions of the new product concept relative to likely alternatives on various determinant attributes the new product may contain. Based on this, infer what step of the positioning process is the firm at? A. determining customers' most preferred combination of determinant attributes B. examining the fit between preferences of market segments and current position of product C. determining product's current location in the product space and intensity D. identifying relevant set of competitive products serving a target market Bloom's: Synthesis Difficulty: Medium Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Preparing the foundation for marketing strategies: the brand positioning process 12. Volvo's emphasis on safety, Toyota's emphasis on reliability and the Holden Monaro's promise of old magic and style in motoring highlight which determinant attribute? A. features B. manufacturing process C. benefits D. endorsements Bloom's: Comprehension Difficulty: Easy Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Step 2: Identify determinant attributes 13. 'At Fidelity, you're not just buying a fund, a stock, or a bond—you're buying a better way to manage it.' Identify the determinant attribute being used here. A. parentage B. comparison C. ingredients D. pro-environment Bloom's: Comprehension Difficulty: Medium Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Step 2: Identify determinant attributes14. Which positioning concept is illustrated by a clothing manufacturer claiming that their shirts are made from pure organic cotton? A. price/quality B. endorsements C. ingredients D. features Bloom's: Application Difficulty: Medium Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Step 2: Identify determinant attributes 15. In entrepreneurial start-ups, there are two ongoing issues that are essential if whatever brand value that's been built is to be maintained and grown. These are: A. brand recall and brand reinforcement B. brand equity and brand loyalty C. brand reinforcement and brand revitalisation D. brand awareness and brand positioning Bloom's: Application Difficulty: Hard Learning Objective: 7.5 Define a unique value proposition. Section: Managing brand equity 16. A bank positions itself using its deposit safety attribute. Why would this positioning not create an impact in the consumer's mind? A. Because consumers can consider only those attributes of which they are aware. B. Because the positioning effort was kept too simple and complexity was not included. C. Because the importance attached to the deposit safety attribute is large and uniform across various consumers. D. Because all the alternative brands are perceived to be about equal on that dimension. Bloom's: Evaluation Difficulty: Hard Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Step 2: Identify determinant attributes17. Identify the incorrect statement concerning the positioning grid. A. It provides a visual representation of the positions of various products in a competitive set. B. Where more than two attributes are to be considered, multidimensional grids are produced. C. It indicates how products within a category compare on the level of as many attributes as are relevant. D. It identifies gaps that may exist either because of technical constraints or lack of prospective customers. Bloom's: Evaluation Difficulty: Easy Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Step 4: Analyse the current positions of products in the competitive set 18. ‘British Leyland was formed through a series of mergers involving a number of British car manufacturers. It did not have a clear identity because it was new and manufactured a variety of brands, including Rover, Triumph and AustinMorris.' Which constraint associated with an intense position does this example illustrate? A. Repositioning may result in alienating the product's current users despite the success with its newly targeted group. B. Success in repositioning efforts may well ensure losing the current group of users. C. The dilution of an existing intense position as a result of consolidation. D. The temptation to overexploit the position by using the brand name on line extensions and new products. Bloom's: Synthesis Difficulty: Hard Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Constraints imposed by a distinctive position 19. Customers are surveyed and asked their preferences among various real or hypothetical product configurations, each with attributes that are systematically varied. This is an example of: A. conjoint analysis B. cluster analysis C. logit analysis D. discriminant analysis Bloom's: Comprehension Difficulty: Easy Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Step 5: Determine customers' most preferred combination of attributes20. Identify the limitation of product positioning analysis. A. It does not tell the marketer which positions are most appealing to customers. B. It does not include a tool to identify gaps where an opportunity for developing a new product exists. C. It does not include a tool indicating how products within a category compare on the level of as many attributes as are relevant. D. It does not indicate how alternative products are positioned relative to one another in customers' minds. Bloom's: Comprehension Difficulty: Medium Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Limitations of product positioning analysis 21. Brand equity is the result of a firm's ability to: A. create differences that consumers find meaningful between their brands and other brands B. maintain high levels of customer service coupled with competitive pricing C. expend resources on advertising and promotion D. capitalise on a niche-market, thereby securing a unique position in relation to competitors Bloom's: Knowledge Difficulty: Easy Learning Objective: 7.6 Understand the outcome of effective positioning. Section: The outcome of effective positioning: building brand equity 22. Parentage is a determinant attribute that relates to which of the following? A. who makes the product and prior products B. safety for children C. strong brand equity and high levels of customer service D. None of the given answers are correct. Bloom's: Knowledge Difficulty: Easy Learning Objective: 7.4 Identify the seven steps used in the positioning process. Section: Step 2: Identify determinant attributes 23. Effective positioning assists in: A. building brand equity. B. product recalls. C. the research and development process. D. enabling price increases to be implemented regularly.1. Which of the following observations about pioneering firms is incorrect? A. They are always the market-share leaders as the new product categories mature. B. They must change and adapt their strategies as their products move through a life cycle. C. Capitalising on early advantage, some of them earn substantial revenues and profits. D. They can be overtaken by followers that offer better products, superior customer service or lower prices. Bloom's: Evaluation Difficulty: Medium Learning Objective: 8.8 Analyse alternative marketing programs for penetrating mass markets in terms of increasing customer awareness and purchases, and entering global markets. Section: Strategic marketing programs for pioneers 2. _____ is designed to obtain as much margin per unit as possible and also enables the company to recover its new product investments more quickly. A. Penetration pricing B. Odd-even pricing C. Skimming D. Prestige pricing Bloom's: Knowledge Difficulty: Easy Learning Objective: 8.5 Investigate and develop objectives for new product and market development. Section: Introductory stage 3. What is true of the introductory stage in a product life cycle? A. The product is easily available. B. The net adoption rate holds steady. C. Shakeout or competitive turbulence occurs at the end of this stage. D. The length of the product line typically should be relatively short. Bloom's: Comprehension Difficulty: Medium Learning Objective: 8.5 Investigate and develop objectives for new product and market development. Section: Introductory stage 4. The shake-out stage in a product life cycle is signalled by: A. an expansion of the product line to attract new segments B. limited purchase of the product due to lack of awareness C. a drop in the overall growth rate and substantial price cuts D. stability in terms of demand, technology and competition Bloom's: Knowledge Difficulty: Medium Learning Objective: 8.3 Understand marketing strategies, marketing mix implications and limitations of the PLC. Section: Sustaining competitive advantage over the product life cycle5. New-to-the-world products can be defined as: A. true innovations that are new to the firm and create an entirely new market B. a product category that is new for the company introducing it, but not new to customers in the target market C. existing products that are targeted at new applications and new market segments D. items providing improved performance brought out to replace existing products Bloom's: Knowledge Difficulty: Easy Learning Objective: 8.4 Investigate variations of newness for new product development. Section: New market entries: how new is new? 6. These items may be moderately new to both the firm and the customers in its established product-markets. A. repositionings B. additions to existing product lines C. new product lines D. improvements in or revisions of existing products Bloom's: Comprehension Difficulty: Hard Learning Objective: 8.4 Investigate variations of newness for new product development. Section: New market entries: how new is new? 7. Which observation best describes new-to-the-world products? A. They are new to the company but not to the market. B. They are often not very innovative in design or operations. C. They are aimed at new customer segments or repositionings of existing products. D. They try to build primary demand by creating product awareness. Bloom's: Comprehension Difficulty: Medium Learning Objective: 8.4 Investigate variations of newness for new product development. Section: New market entries: how new is new? 8. To establish a foothold in a future new market, or pre-empt a market segment, a firm must introduce: A. new-to-the-world products; improvements or revisions to existing products B. new-to-the-world products; additions to existing product line; repositionings C. additions to or revisions of existing product line; repositionings; cost reductions D. new-to-the-world products; new product line Bloom's: Application Difficulty: Hard Learning Objective: 8.7 Investigate alternative marketing strategies and objectives for new product pioneers, including skimming, niche and mass-market penetration. Section: New market entries: how new is new?9. Improving or revising existing products, additions to existing product lines and cost reductions aim at achieving which of the following objectives? A. capitalising on distribution strengths B. maintaining position as a product innovator C. exploiting technology in a new way D. defending a current market-share position Bloom's: Evaluation Difficulty: Medium Learning Objective: 8.5 Investigate and develop objectives for new product and market development. Section: Objectives of new product and market development 10. Identify an advantage of follower strategies. A. influencing consumer choice criteria and attitudes B. making the best use of latest technology C. possibility of positive network effects D. ability to define the rules of the game Bloom's: Knowledge Difficulty: Medium Learning Objective: 8.6 Identify market entry strategies, how they differ for pioneers and followers, and advantages and determinants of success for market leaders (as opposed to followers). Section: Follower strategy 11. The pioneer's brand can become the standard of reference customers use to evaluate other brands, making it more difficult for followers to convince existing customers that their new brands are superior to the older and more familiar pioneer. Which advantage of being a pioneer does this explain? A. first choice of market segments and positions B. economies of scale and experience C. distribution advantages D. high switching costs for early adopters Bloom's: Analysis Difficulty: Hard Learning Objective: 8.6 Identify market entry strategies, how they differ for pioneers and followers, and advantages and determinants of success for market leaders (as opposed to followers). Section: Pioneer strategy12. Through product enhancement, Compaq captured a substantial share of the commercial PC market by developing faster and more portable versions of IBM's original machine. This example illustrates Compaq's ability to take advantage of the pioneer's: A. marketing mistakes B. limited resources C. positioning mistakes D. product mistakes Bloom's: Analysis Difficulty: Medium Learning Objective: 8.6 Identify market entry strategies, how they differ for pioneers and followers, and advantages and determinants of success for market leaders (as opposed to followers). Section: Follower strategy 13. Pioneers that are able to maintain their preeminent position well into the market's growth stage have supported their early entry with one or more marketing strategy elements. Identify the strategy that allows firms to expand their volumes quickly and achieve the benefits of experience-curve effects before major competitors can confront them. A. broad product lines B. heavy promotional expenditures C. large entry scale D. high product quality Bloom's: Knowledge Difficulty: Hard Learning Objective: 8.6 Identify market entry strategies, how they differ for pioneers and followers, and advantages and determinants of success for market leaders (as opposed to followers). Section: Pioneer strategy 14. Which of the following elements belongs to the successful late entrants' market strategy? A. leapfrogging the pioneer with superior product technology B. focusing on peripheral target markets or niches C. larger entry scale than the pioneer D. heavy promotional expenditures Bloom's: Knowledge Difficulty: Easy Learning Objective: 8.6 Identify market entry strategies, how they differ for pioneers and followers, and advantages and determinants of success for market leaders (as opposed to followers). Section: Determinants of success for pioneers and followers15. Identify the firm characteristic of mass-market penetration for new product pioneers. A. limited marketing skills and resources B. a prospector with good capability for continued new product innovation C. ability to shift from stimulation of primary demand to stimulation of selective demand D. limited financial resources to commit to building capacity prior to demand growth Bloom's: Knowledge Difficulty: Medium Learning Objective: 8.7 Investigate alternative marketing strategies and objectives for new product pioneers, including skimming, niche and mass-market penetration. Section: Strategic marketing programs for pioneers 16. All of the following are true of firms adopting the niche penetration marketing strategy except: A. It is appropriate when a number of different benefit segments are present in the new market. B. It is attractive when only a few barriers to the entry of major competitors exist. C. It is appropriate when the new market for the new product is more fragmented than expected. D. It is appropriate when the product category is likely to experience positive network effects. Bloom's: Evaluation Difficulty: Hard Learning Objective: 8.7 Investigate alternative marketing strategies and objectives for new product pioneers, including skimming, niche and mass-market penetration. Section: Niche penetration 17. Which of the following marketing programs is used by the niche penetration strategy to increase the customers' ability to buy? A. moving relatively quickly to expand offerings to appeal to multiple segments B. offering free trial or extended warranty policies to reduce target customers' perceived risk C. attempting to maintain margins at level consistent with value of product to early adopters D. starting with high price but bringing out lower-priced versions in anticipation of competitive entries Bloom's: Knowledge Difficulty: Medium Learning Objective: 8.7 Investigate alternative marketing strategies and objectives for new product pioneers, including skimming, niche and mass-market penetration. Section: Niche penetration18. _____ is the simplest way to enter a foreign market because it involves the least commitment and risk. A. Exporting B. Countertrade C. Franchising D. Overseas direct investment Bloom's: Analysis Bloom's: Application Difficulty: Easy Learning Objective: 8.8 Analyse alternative marketing programs for penetrating mass markets in terms of increasing customer awareness and purchases Learning Objective: 8.8 Analyse alternative marketing programs for penetrating mass markets in terms of increasing customer awareness and purchases, and entering global markets. Section: Considerations when pioneering global markets 19. Economists have noted how the value of a product or service can increase as more consumers adopt the product; in other words, as the network increases. This is referred to as: A. economies of scale B. economies of scope C. positive network effect D. increasing returns to scale Bloom's: Application Difficulty: Easy Learning Objective: 8.6 Identify market entry strategies, how they differ for pioneers and followers, and advantages and determinants of success for market leaders (as opposed to followers). Section: Considerations when pioneering global markets Section: Pioneer strategy 20. Pioneering firms often have distribution advantages over follower firms because: A. distributors are wary of the high switching costs for end-consumers B. distributors are often reluctant to take on second or third brands C. distributors are can never enjoy the positive network effect D. dollower firms are typically stuck in the middle Bloom's: Knowledge Difficulty: Easy Learning Objective: 8.8 Analyse alternative marketing programs for penetrating mass markets in terms of increasing customer awareness and purchases, and entering global markets. Section: Pioneer strategy21. The communications task is to move the potential customers through the four main stages of: A. attention, interest, discovery, adoption B. affiliation, interest, desire, affection C. affection, attention, adoption, assurance D. awareness, interest, desire, action Bloom's: Knowledge Difficulty: Hard Learning Objective: 8.4 Investigate variations of newness for new product development. Section: Marketing mix in the introductory stage 22. For industrial products, the time required to develop awareness of a product's uniqueness is often extensive. Therefore, firms selling industrial products usually engage in which of the following promotional activities? A. personal selling B. advertising on TV C. ublic relations campaigns D. product placement Bloom's: Application Difficulty: Medium Learning Objective: 8.4 Investigate variations of newness for new product development. Section: Increasing customer awareness and ability to buy 23. IT innovation and entrepreneurialism resulting in development of ebay, Facebook and Google is associated with which geographic location? A. Helium Valley B. Silicon City C. Silicon Valley D. Silicone Valley Bloom's: Knowledge Difficulty: Easy Learning Objective: 8.2 Explain new theory and practice in marketing around start-ups, gazelles and jobs to be done. Section: Marketing strategies of start-ups and gazelles24. The strength of Apple is mainly due to ______. A. innovation B. a focus upon professional management C. poor decisions by competitors D. being a follower Bloom's: Knowledge Difficulty: Easy Learning Objective: 8.1 Overview key strategic challenges and features of new market entry including being a pioneer and investing in innovation. Section: Strategic challenges addressed in chapter 8 25. ‘New' products are not all equally new. Booz Allen Hamilton suggests there are actually ______ categories of new products. A. 6 B. 5 C. 4 D. 3 Bloom's: Knowledge Difficulty: Difficult Learning Objective: 8.4 Investigate variations of newness for new product development. Section: New market entries: how new is new? 26. Products new to the company but not new to the market often present fewer challenges for R&D and product engineering. This strategy has been used effectively in the automobile sector by ______ car manufacturers. A. German B. French C. North American D. Chinese and Indian 1. All of the following are reasons why followers are attracted to rapidly growing markets except: A. It is easier to gain share when a market is growing. B. The price competition is likely to be less intense. C. The share gains are seldom worth more in a growth market than in a mature market. D. It is necessary to make sure that the firm keeps pace with the technology. Bloom's: Evaluation Difficulty: Easy Learning Objective: 9.2 Explain and investigate opportunities and risks involved in growth markets. Section: Opportunities and risks in growth markets2. Conventional wisdom suggests growing markets present attractive opportunities for future profits because: A. share gains are worth less in a growth market than a mature market B. price competition is likely to be more intense C. it is easier to gain share when a market is growing D. it is more difficult for leaders to gain share when the market is growing Bloom's: Evaluation Difficulty: Easy Learning Objective: 9.2 Explain and investigate opportunities and risks involved in growth markets. Section: Opportunities and risks in growth markets 3. Which of the following is a marketing objective for share leaders? A. delineate into niche target markets in product growth stage B. stimulate selective demand among innovators C. retain existing customers and ensure brand loyalty D. stimulate secondary demand to help speed up overall market growth Bloom's: Knowledge Difficulty: Easy Learning Objective: 9.3 Identify growth market strategies for market leaders. Section: Marketing objectives for share leaders 4. Identify a market leader's action aimed at stimulating selective demand among later adopters. A. maintaining/improving customer satisfaction and loyalty B. encouraging/simplifying repeat purchase C. differentiated positioning against competitive offerings D. reducing attractiveness of switching Bloom's: Comprehension Difficulty: Hard Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Marketing objectives for share leaders 5. The marketing action of developing a product line with features that are more appealing to a specific segment of potential customers is characteristic of the: A. market expansion strategy B. contraction strategy C. flanker strategy D. confrontation strategy Bloom's: Knowledge Difficulty: Medium Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Marketing actions and strategies to achieve share-maintenance objectives6. Which of the following statements is associated with the fortress strategy? A. leader develops a strong position when potential customers have relatively homogeneous needs B. leader develops a second brand to compete directly against the challenger's offering C. leader changes the marketing program before a suspected competitive challenge occurs D. leader defends its relative market share by expanding into a number of market segments Bloom's: Knowledge Difficulty: Hard Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Fortress strategy or position defence strategy 7. A firm can implement any combination of the given strategies to maintain its leading share position. A firm can choose the preferred combination for a particular product market based on all of the following except: A. the market's size and its customers' characteristics B. the number and relative strengths of the potential competitors in that market C. the leader's own resources and competencies D. the leader's organisational history and culture Bloom's: Knowledge Difficulty: Easy Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Marketing actions and strategies to achieve share-maintenance objectives 8. Identify the primary objective of the confrontation share maintenance strategy. A. appeal to late adopters with same attributes and benefits offered to early adopters B. improve ability to retain current customers as market fragments C. increase ability to attract new customers in selected high-growth segments by focusing resources on them D. improve ability to win new customers who might otherwise be attracted to competitor's offering Bloom's: Comprehension Difficulty: Hard Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Marketing actions and strategies to achieve share-maintenance objectives9. Which strategy has a market characteristic of a relatively homogeneous market in relation to customer needs and purchase criteria? A. fortress or position defence strategy B. market expansion strategy C. contraction or strategic withdrawal strategy D. flanker strategy Bloom's: Knowledge Difficulty: Easy Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Marketing actions and strategies to achieve share-maintenance objectives 10. What action step must a leader take to improve customer satisfaction as competition enters, or prepares to enter the market? A. Leader should take steps to improve not only the physical product but customers' perceptions of it as well. B. Leader's sales promotion emphasis should shift from building selective demand to stimulating primary demand. C. Leader should continue sales promotion efforts aimed only at stimulating trial among later adopters. D. Sales-force efforts should shift from servicing existing customers to prospecting for new accounts. Bloom's: Comprehension Difficulty: Medium Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Actions to improve customer satisfaction and loyalty 11. Toyota Motors has introduced a new line of cars aimed at creating an appeal for young car buyers looking for good quality, funky designs and low-prices. Their intent is to protect their primary brands from direct competition in the same category and from low-price competitors. What is the strategy employed by Toyota? A. confrontation strategy B. position defence strategy C. flanker strategy D. market expansion strategy Bloom's: Comprehension Difficulty: Hard Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Flanker strategy12. A firm develops line extensions, new brands or alternative product forms utilising similar technologies to appeal to multiple market segments. Identify the strategy employed here. A. flanker strategy B. fortress strategy C. confrontation strategy D. market expansion strategy Bloom's: Knowledge Difficulty: Medium Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Market expansion strategy 13. Strategic withdrawal strategy is best suited when: A. A firm is unable to defend itself adequately in all segments due to competitors having more resources. B. A firm's primary objective is to capture a large share of new customers who may prefer something different from the initial offering. C. A competitor chooses to attack the leader head to head and attempts to steal customers in the target market. D. A firm is trying to beat the attractive features of a competitor's offering only after the challenger's success has become obvious. Bloom's: Application Difficulty: Hard Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders. Section: Contraction strategy or strategic withdrawal strategy 14. What is the major marketing objective for followers? A. defend market position B. develop only a niche strategy C. attain share growth D. start discrete price wars Bloom's: Knowledge Difficulty: Medium Learning Objective: 9.6 Understand and interpret share growth strategies, objectives and actions for challengers, including capturing current customers or stimulating demand from competitors. Section: Marketing objectives for followers15. Attacking the leader within its primary target market involves which of the following strategies? A. flanker strategy B. frontal attack strategy C. encirclement strategy D. guerrilla attack strategy Bloom's: Comprehension Difficulty: Medium Learning Objective: 9.6 Understand and interpret share growth strategies, objectives and actions for challengers, including capturing current customers or stimulating demand from competitors. Section: Frontal attack strategy 16. What strategy would a challenger be pursuing if its primary objective is to capture a modest share of repeat purchases in several market segments? A. frontal attack strategy B. leapfrog strategy C. guerrilla attack strategy D. encirclement strategy Bloom's: Application Difficulty: Medium Learning Objective: 9.6 Understand and interpret share growth strategies, objectives and actions for challengers, including capturing current customers or stimulating demand from competitors. Section: Guerrilla attack 17. The primary objective of encirclement strategy is to: A. attract significant share of new customers in specialised, smaller segments B. capture a modest share of repeat purchases in several market segment C. stimulate current customers to purchase superior new offering D. capture substantial repeat purchases from target competitor's current customers Bloom's: Knowledge Difficulty: Medium Learning Objective: 9.6 Understand and interpret share growth strategies, objectives and actions for challengers, including capturing current customers or stimulating demand from competitors. Section: Flanking and encirclement strategies 18. A leader is typically: A. a laggard as they have learned from the mistakes of the first entrant B. cost conscious C. a multi-national organisation D. a pioneer, or at least one of the first entrants Bloom's: Knowledge Difficulty: Medium Learning Objective: 9.3 Identify growth market strategies for market leaders. Section: Growth-market strategies for market leaders19. A firm develops differentiated product offerings targeted at one large or several smaller segments in which no competitor currently holds a strong position. What strategy is being used here? A. frontal attack B. leapfrog C. guerrilla attack D. encirclement Bloom's: Knowledge Difficulty: Easy Learning Objective: 9.6 Understand and interpret share growth strategies, objectives and actions for challengers, including capturing current customers or stimulating demand from competitors. Section: Marketing actions and strategies to achieve share growth 20. When growth in the personal computer (PC) market slumped in 2000 due to the dot-com crash and other factors, Dell Computer decided to: A. launch a brutal price war aimed at taking more business away from competitors B. invest heavily in research and development in order to compete in new markets C. launch a superior customer service program aimed at capturing customers from competing firms in the computer industry D. invest heavily in TV advertising to convince consumers of the benefits of using computers Bloom's: Knowledge Difficulty: Medium Learning Objective: 9.2 Explain and investigate opportunities and risks involved in growth markets. Section: Gaining share is easier 21. When Samsung decided to withdraw from the most price-sensitive consumer electronics segments and from US discount retailers such as WalMart, it was engaging in a typical: A. strategic withdrawal strategy B. leapfrog strategy C. flanker strategy D. backward integration strategy Difficulty: Easy Learning Objective: 9.5 Analyse strategic defensive and offensive decisions for growth market leaders.Bloom's: Knowledge Section: Contraction strategy or strategic withdrawal strategy 22. Relative to a leader, a challenger is often at a cost disadvantage. This is mainly because of: A. the relative brand equity of the leader B. the experience curve effects established by the leader C. diminishing returns to scale experienced by the challenger D. the network effects enjoyed by the leader1. Which statement is most indicative of a maturing market? A. Total sales volume stabilises. B. First-time buyers account for a vast majority of sales volume. C. The primary objective of firms is to find new markets for existing products. D. Managers face the critical question of whether to divest or liquidate the company. Bloom's: Knowledge Difficulty: Easy Learning Objective: 10.1 Understand key strategic challenges and features of mature and declining markets in rapidly changing business environments. Section: Challenges in mature markets 2. What is true of the transition from market growth to maturity? A. often accompanied by a shakeout, during which weaker businesses fail< B. almost always followed by a period of competitive inertia C. often begins after the product has been introduced D. characterised by competitors underestimating future sales volume Bloom's: Knowledge Difficulty: Medium Learning Objective: 10.2 Analyse the stage between growth and maturity and possible strategic traps in this transition. Section: Shake-out: the transition from market growth to maturity 3. Failure in anticipating transition from growth to maturity leads to all of the following consequences except: A. Firms expand rapidly and production capacity overshoots demand as growth slows. B. Firms reduce prices or increase promotion to increase their sales volume. C. Firms experience large technological differentials as competitors leave the market. D. Firm may make overly optimistic forecasts of future sales volume. Bloom's: Knowledge Difficulty: Hard Learning Objective: 10.2 Analyse the stage between growth and maturity and possible strategic traps in this transition. Section: Shake-out: the transition from market growth to maturity4. ‘A business may survive and prosper during the growth stage even though it has neither differentiated its offering from competitors nor attained the lowestcost position in its industry, but not so in the transition period. This is true of which strategic trap? A. failure to recognise the events signalling the beginning of the shakeout period B. getting caught in the transition period without a clear strategic advantage C. failure to recognise the declining importance of product differentiation and the increasing importance of service D. giving up market share too easily in favour of short-run profit Bloom's: Comprehension Difficulty: Medium Learning Objective: 10.2 Analyse the stage between growth and maturity and possible strategic traps in this transition. Section: Shake-out: the transition from market growth to maturity 5. National Motors manufactures high-end automobiles. The attributes of their cars include excellent handling, acceleration, comfort and braking, providing the company with an advantage over its competitors. Identify the product quality dimension of these cars. A. reliability B. performance C. durability D. serviceability Bloom's: Application Difficulty: Easy Learning Objective: 10.4 Understand key methods for building a point of difference in mature markets. Section: Dimensions of product quality 6. The quality dimension of _____ refers to a customer's ability to obtain prompt and competent service when the product does break down. A. serviceability B. reliability C. brand equity D. durability Bloom's: Knowledge Difficulty: Easy Learning Objective: 10.4 Understand key methods for building a point of difference in mature markets. Section: Dimensions of product quality7. This quality dimension refers to the absence of defects: A. reliability B. durability C. brand equity and fit and finish D. conformance to specifications Bloom's: Application Difficulty: Medium Learning Objective: 10.4 Understand key methods for building a point of difference in mature markets. Section: Dimensions of product quality 8. The gap between management perceptions and service quality specifications occurs when: A. A firm's policies concerning customer service are unclear or haphazardly enforced. B. A firm does not have an accurate understanding of service evaluation by customers. C. A firm's marketing communications causes unrealistically high expectations in customers. D. A firm fails to give its employees adequate reward structures for good performance. Bloom's: Knowledge Difficulty: Medium Learning Objective: 10.4 Understand key methods for building a point of difference in mature markets. Section: Improving customer perceptions of service quality 9. A period of competitive turbulence almost always accompanies the transition from market ______ in an industry. A. growth to maturity B. maturity to decline C. peak to slowdown D. maturity to growth Bloom's: Knowledge Difficulty: Medium Learning Objective: 10.5 Analyse key methods for building a low-cost advantage in mature markets. Section: Strategic challenges addressed in chapter 10 10. The production of no frills goods to maintain a low-cost position: A. involves removing all extras from the basic product or service B. involves the use of customised component parts C. always involves short-term profits through the use of inexpensive labour D. involves replacing technology to personalised services Bloom's: Knowledge Difficulty: Medium Learning Objective: 10.5 Analyse key methods for building a low-cost advantage in mature markets. Section: A no-frills product11. Fort Howard Paper achieved a cost advantage by being the first major papermaker to rely exclusively on recycled pulp. The firm's lower cost gave it a competitive edge in the price-sensitive commercial market for toilet paper and other such products used in hotels, restaurants and office buildings. Which method of maintaining a low-cost position has the company used? A. low-cost distribution B. cheaper raw materials C. no-frills product D. innovative product design Bloom's: Analysis Difficulty: Medium Learning Objective: 10.5 Analyse key methods for building a low-cost advantage in mature markets. Section: Cheaper raw materials 12. Financial dimensions of performance are usually of greater interest than growth-oriented dimensions to defender businesses because they are concerned with: A. maximising profitability over the remaining life of their existing product markets B. creating new opportunities in one or more mature market segments C. volume increases or new product success D. passively defending their mature products Bloom's: Knowledge Difficulty: Hard Learning Objective: 10.5 Analyse key methods for building a low-cost advantage in mature markets. Section: Customers' satisfaction and loyalty are crucial for maximising their lifetime value 13. Identify the market characteristic that affirms growth extension in maturing markets through application of an extended use strategy. A. insufficient competencies to pre-empt underdeveloped applications segments B. relatively heterogeneous market with a variety of segments C. relatively high penetration but low frequency of use in one or more major segments D. relatively low penetration in one or more segments Bloom's: Evaluation Difficulty: Hard Learning Objective: 10.7 Identify key marketing strategies that can be applied in mature markets to maintain market share or catapult a late burst of growth. Section: Strategies for extending volume growth14. To develop a differentiated positioning focused on untapped segments using a market expansion strategy, a firm should: A. encourage larger volume purchases for non-perishable products B. stimulate additional primary demand by promoting new features C. develop a differentiated flanker brand with more appealing unique features D. move storage of the product closer to the point of end use by offering additional package sizes Bloom's: KnowledgeSection: Strategies for extending volume growth Difficulty: Hard Learning Objective: 10.7 Identify key marketing strategies that can be applied in mature markets to maintain market share or catapult a late burst of growth. 15. A successful increased penetration strategy depends on discovering why nonusers are uninterested in the product. Often, consumers do not perceive enough value in the product. Which of the following is not a suitable solution to enhance product value? A. Add features or benefits, usually via line extensions. B. Develop and sell integrated systems that help improve the basic product's performance or ease of use. C. Offer services that improve its performance or ease of use for the potential customer. D. Develop more convenient and accessible channels of distribution. Bloom's: Evaluation Difficulty: Easy Learning Objective: 10.7 Identify key marketing strategies that can be applied in mature markets to maintain market share or catapult a late burst of growth. Section: Increased penetration strategy 16. Which of the following is not a factor that helps determine the strategic attractiveness of declining product markets? A. time to market B. conditions of demand C. exit barriers D. intensity of future competitive rivalry Bloom's: Knowledge Difficulty: Easy Learning Objective: 10.8 Interpret and analyse strategies for declining markets. Section: Relative attractiveness of declining markets17. Conditions of demand, factors that help determine the strategic attractiveness of declining product markets, include demand characteristics such as the rate and the certainty of sales decline. What observation is true of the market conditions being affected by these characteristics? A. A slow and gradual decline allows an orderly withdrawal of weaker competitors. B. Overcapacity is more likely to become excessive and lead to predatory competitive behaviour. C. Competitors who remain are less likely to make profits than in a quick or erratic decline. D. Reduction of capacity is more likely to be erratic when industry managers believe market decline is predictable. Bloom's: Analysis Difficulty: Medium Learning Objective: 10.8 Interpret and analyse strategies for declining markets. Section: Conditions of demand 18. A harvesting strategy can be used in all the following situations except: A. when rivalry among remaining competitors is likely to be very intense B. when the market's decline is inevitable C. when the market's decline is likely to occur at a relatively slow and steady rate D. when a firm has a strong competitive position in the market at the start of the decline Bloom's: Evaluation Difficulty: Medium Learning Objective: 10.9 Identify declining markets and evaluate their important characteristics. Section: Harvesting strategy 19. The higher the ____, the less hospitable a product market will be during the decline phase of its life cycle. A. switching cost for consumers B. brand equity C. economies of scale D. exit barrier Bloom's: Knowledge Difficulty: Medium Learning Objective: 10.8 Interpret and analyse strategies for declining markets. Section: Exit barriers20. A. (A market expansion strategy is usually best suited for: B. challengers C. share leaders D. analysers E. challengers and analysers Bloom's: Analysis Difficulty: Medium Learning Objective: 10.7 Identify key marketing strategies that can be applied in mature markets to maintain market share or catapult a late burst of growth. Section: Market expansion strategy 21. Which of the following is not a method of maintaining a low-cost position? A. innovative product design B. reductions in overhead C. no-frills products D. superior customer service Bloom's: Analysis Difficulty: Easy Learning Objective: 10.3 Interpret strategic choices in mature markets. Section: Methods of maintaining a low-cost position 22. Which of the following is not a strategic trap businesses can fall into during the shake-out period? A. failure to anticipate transition from growth to maturity B. no clear competitive advantage as growth slows C. assumption that an early advantage will insulate the business from price or service competition D. not sacrificing market share in favour of short-run profit Bloom's: Evaluation Difficulty: Hard Learning Objective: 10.2 Analyse the stage between growth and maturity and possible strategic traps in this transition. Section: Strategic traps during the transition 23. A business may enhance a product's value by offering services that improve its performance or ease of use for the potential customer. Which of the following is an example of this? A. the Australian Football League in Australia including Mandarin speakers in radio broadcasts to attract other ethnic groups B. the removal of full-size spare tyres in motor vehicles C. the deletion of product features D. price increases1. E-readiness is a measure of: A. the quality of an individual marketing manager's understanding of online processes B. the ability of a firm to sell its products online rather than through conventional distribution channels C. the quality of a country's information and communication technology infrastructure and the ability of consumers, governments and businesses to use this to their benefit D. the ability of firms in a given industry to engage in online advertising strategies in order to compete with other firms in different industries Bloom's: Knowledge Difficulty: Easy Learning Objective: 11.2 Identify digital economy history and development implications for business and marketers. Section: The ‘new economy' 2. With the digital economy, the challenge is to ______. A. slow down B. introduce new products sparingly C. stay off-line as going on-line is fraught with danger D. keep up Bloom's: Knowledge Difficulty: Medium Learning Objective: 11.5 Utilise improved tools for an integrated offline–online business model that drives marketing strategy. Section: Advancing a new integrated digital business model 3. ICT stands for ______. A. Integrated Communication Technology B. Impressive Conductivity Transfer C. Interested Creativity of Technology D. Information and Communications Technology Bloom's: Knowledge Difficulty: Medium Learning Objective: 11.2 Identify digital economy history and development implications for business and marketers. Section: The ‘new economy' 4. Wikis, blogs, podcasting and RSS feeds were all early examples of: A. semantic web B. third-party applications C. e-commerce D. Web 2.0 Bloom's: Knowledge Difficulty: Medium Learning Objective: 11.5 Utilise improved tools for an integrated offline–online business model that drives marketing strategy. Section: Web 2.05. UVP stands for ______. A. Universal Value Proposal B. Unique Virtual Platform C. Universal Value Platform D. Unique Value Proposition Bloom's: Knowledge Difficulty: Medium Learning Objective: 11.5 Utilise improved tools for an integrated offline–online business model that drives marketing strategy. Section: Incorporating key marketing elements into a new integrated offline–online business model 6. The social media landscape is characterised by number of major applications. Which of the following is not a social media application? A. games B. publishing C. advertising D. sharing Bloom's: Evaluation Difficulty: Hard Learning Objective: 11.6 Acknowledge that in the digital domain, a marketer is increasingly reliant on download speeds and building social media connectivity. Section: Social media 7. ‘S&DDL' refers to: A. severe and devastating digital leaks B. service and digital-dominant logic C. service and dynamic dominant logic D. servicing and detecting dominant logic Bloom's: Knowledge Difficulty: Easy Learning Objective: 11.5 Utilise improved tools for an integrated offline–online business model that drives marketing strategy. Section: Service and digital-dominant (S&DDL) marketing 8. According to the textbook, which country has the fastest average internet connection speed? A. Korea B. Finland C. France D. Japan Bloom's: Knowledge Difficulty: Medium Learning Objective: 11.5 Utilise improved tools for an integrated offline–online business model that drives marketing strategy. Section: Powering the digital economy: why broadband and fast speeds matter9. RSS (such as in RSS feeds) is short for: A. really simple syndication B. real-time syndication services C. readable site summary D. repreadable syndication serviceslace Bloom's: Knowledge Difficulty: Hard Learning Objective: 11.6 Acknowledge that in the digital domain, a marketer is increasingly reliant on download speeds and building social media connectivity. Section: Web 2.0 10. Which of the following are typically viewed as Web 1.0 based? A. email B. search engines C. wikis D. blogs Bloom's: Knowledge Difficulty: Hard Learning Objective: 11.11 Identify how the online environment and its applications are evolving, what this means for research Section: Web 3.0, Web 4.0, quantum computing and the cloud 11. A service-dominant logic (SDL) perspective would suggest that a product such as Apple's iPad was successful because: A. It revolutionised touch-screen technology. B. Services such as third-party applications added value to the user experience. C. Apple provided extended service warranties and after-sale support. D. Customer service at the Apple Store exceeded expectations and created demand. Bloom's: Evaluation Difficulty: Hard Learning Objective: 11.7 Comprehend developments in service and digital-dominant logic (S&DDL), incorporating critical tools in information management and CRM. Section: Example of S&DDL: the Apple iPhone/iPad12. Which of the following is characteristic of a bottom-up marketing approach in the digital economy? A. start with basic transactions at the real-time trading level direct from the electronic marketing system B. start with high level broad segments and develop carefully defined segments C. direct marketing and catalogue distribution D. product management based on broadly defined segments in geographically diverse locations Bloom's: Evaluation Difficulty: Medium Learning Objective: 11.8 Acknowledge new ways of interfacing with customers through online platforms and understand that the web transforms the way marketers connect with customers. Section: Digital economy and interfacing with customers 13. In customer relationship management (CRM), there are two types of analytics used to identify, collect and report in formation. The two types of analytics are: A. soft and loose analytics B. prescriptive and soft analytics C. descriptive and predictive analytics D. syndicated and prescriptive analytics Bloom's: Knowledge Difficulty: Easy Difficulty: Medium Learning Objective: 11.8 Acknowledge new ways of interfacing with customers through online platforms and understand that the web transforms the way marketers connect with customers. Section: Digital economy and interfacing with customers Section: How do we look online? The customer interface 14. A digital marketing strategy framework begins with: A. the design of a website using Rayport and Jaworski's 7Cs of customer interface framework B. the development of mobile applications to facilitate smartphone and computer tablet integration C. investing in bandwidth and storage capabilities D. an assessment of the level and depth of digitisation Bloom's: Knowledge Difficulty: Medium Learning Objective: 11.10 Develop a digital economy marketing strategy and decision framework. Section: Developing a digital economy marketing strategy: a decision framework15. Digital disruption in an industry refers to: A. the degree to which an industry has had to transform as a result of the internet B. the degree to which an industry uses digital technology in its advertising C. the penetration of digital media within that industry D. the amount of money the industry spends on advertising using social media Bloom's: Knowledge Difficulty: Easy Learning Objective: 11.12 Acknowledge that the digital marketing terrain is a revolution that will continue to influence ongoing marketing decisions. Section: The ongoing digital marketing revolution 16. Which of the following industries have already been subjected to digital disruption? A. automobile, restaurants, health care B. airlines, newspapers, TV C. real estate, education, banking D. fashion, cinemas, fitness Bloom's: Evaluation Difficulty: Easy Learning Objective: 11.12 Acknowledge that the digital marketing terrain is a revolution that will continue to influence ongoing marketing decisions. Section: The ongoing digital marketing revolution 17. According to Nova Spivack, Web 2.0 is: A. high in both social connectivity and information connectivity B. low in social connectivity but high in information connectivity C. low in both social connectivity and information connectivity D. high in social connectivity but low in information connectivity Bloom's: Knowledge Difficulty: Hard Learning Objective: 11.11 Identify how the online environment and its applications are evolving, what this means for research Section: Web 3.0, Web 4.0, quantum computing and the cloud 18. High levels of digitisation are usually associated with: A. physical products with little information flow B. superior customer service C. information rich goods or services D. services with considerable brand equity Bloom's: Evaluation Difficulty: Easy Learning Objective: 11.10 Develop a digital economy marketing strategy and decision framework. Section: Developing a digital economy marketing strategy: a decision framework19. One of the reasons that Dell Computer found it relatively easy to migrate to the web was because: A. Dell was already established as a telephone business with effective supporting systems. B. Dell had a long-standing policy of only hiring software engineers. C. Dell's customers were already tech-savvy, which facilitated the migration to the web. D. Dell's headquarters were in Silicon Valley which gave it a strategic advantage and provided it with digital readiness. Bloom's: Application Difficulty: Medium Learning Objective: 11.2 Identify digital economy history and development implications for business and marketers. Section: Typical new economy priorities and responses for marketers 20. Which of the below is not a broadband technology? A. NBN Fibre B. SaaS C. ADSL D. WiFi Bloom's: Evaluation Difficulty: Hard Learning Objective: 11.7 Comprehend developments in service and digital-dominant logic (S&DDL), incorporating critical tools in information management and CRM. Section: Powering the digital economy: why broadband and fast speeds matter 21. Web 3.0 is based on ______. A. the metaweb connecting intelligence B. the semantic web connecting knowledge C. the web connecting information D. social software connecting people 1. What is an organisational fit? A. It refers to a firm using a highly centralised organisation structure in its early growth and effectively respond to the changes in the market. B. It is a fit between an organisation's marketing strategy and the needs of its target customers and the technological realities of the marketplace. C. It refers to a well-conceived foundation that permits effective implementation of a particular strategy. D. It is the fit between a business's competitive and marketing strategies and the organisational structures, processes and plans necessary to effectively implement them. Bloom's: Knowledge Difficulty: Medium Learning Objective: 12.1 Design appropriate administrative relationships for the implementation of different competitive strategies. Section: Strategic challenges addressed in chapter 122. The evaluation and reward systems for which strategy comprises high incentives based on sales and share growth? A. differentiated defender B. prospector C. low-cost defender D. reactor Bloom's: Knowledge Difficulty: Hard Learning Objective: 12.1 Design appropriate administrative relationships for the implementation of different competitive strategies. Section: Designing appropriate administrative relationships for the implementation of different competitive strategies 3. SBU autonomy level is moderate in which business strategy? A. differentiated defender B. prospector C. low-cost defender D. reactor Bloom's: Knowledge Difficulty: Easy Learning Objective: 12.1 Design appropriate administrative relationships for the implementation of different competitive strategies. Section: Designing appropriate administrative relationships for the implementation of different competitive strategies 4. Which of the following relates to shared programs and synergy for a low-cost defender? A. little synergy in areas central to differentiation—shared programs elsewhere B. relatively little synergy—few shared programs C. no synergy—no shared programs D. high level of synergy and shared programs Bloom's: Knowledge Difficulty: Hard Learning Objective: 12.1 Design appropriate administrative relationships for the implementation of different competitive strategies. Section: Designing appropriate administrative relationships for the implementation of different competitive strategies5. What represents the functional coordination and conflict resolution for the successful implementation of a low-cost defender strategy? A. SBU will experience moderate levels of inter-functional conflict. B. SBU will perform best on ROI and cash flow dimensions when conflict resolution mechanisms are hierarchical. C. SBU will experience high levels of inter-functional conflict. D. SBU will perform best on volume and share-growth dimensions when participative resolution mechanisms are used. Bloom's: Comprehension Difficulty: Hard Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Designing appropriate administrative relationships for the implementation of different competitive strategies 6. What does centralisation refer to? A. the location of decision authority and control within an organisation's hierarchy B. the degree to which formal rules and standard policies and procedures govern decisions and working relationships C. the degree to which organisations emphasise the managing of business processes in contrast to functional areas D. the division of tasks and activities across positions within the organisational unit Bloom's: Knowledge Difficulty: Easy Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Organisational structures 7. Prospector business units and their marketing departments are likely to perform better when: A. The decision-making authority is centralised. B. Rigid rules and policies dominate managerial discretion. C. There is a high degree of formalisation. D. They are decentralised. Bloom's: Comprehension Difficulty: Hard Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Organisational structures8. Identify the simplest and most bureaucratic organisational design. A. product management B. market management C. matrix D. functional Bloom's: Evaluation Difficulty: Medium Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Functional organisations 9. Product management organisations: A. rely primarily on hierarchical mechanisms for resolving conflicts across functional areas B. are characterised by decentralised decision-making while increasing the amount of product specialisation within the SBU C. are the most specialised type of organisation D. are the most common organisational form among entrepreneurial start-ups, including many dot-com companies Bloom's: Knowledge Difficulty: Medium Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Product management organisations 10. Identify the statement that relates to the market management organisation. A. A product manager has overall responsibility for planning and implementing a national marketing program for the product. B. This form is the least bureaucratic or centralised and the most specialised type of organisation. C. This is particularly suitable for a business facing an extremely complex and uncertain environment. D. It involves the creation of an additional organisational unit responsible for coordinating the actions of other units within the firm. Bloom's: Evaluation Difficulty: Medium Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Market management organisations11. The matrix form is the most: A. bureaucratic type of organisation B. centralised type of organisation C. specialised type of organisation D. common type of organisation Bloom's: Knowledge Difficulty: Medium Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Matrix organisations 12. Regardless of the form of worker self-management, all self-managing teams are based on this concept. A. empowerment B. joint venture C. centralisation D. hierarchy Bloom's: Knowledge Difficulty: Medium Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Recent trends in organisational design 13. Which global organisational type is especially appropriate when there is considerable variance across markets regarding product acceptance and marketing activities? A. functional B. product C. area D. process Bloom's: Evaluation Difficulty: Easy Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: An international division14. The executive summary in an annual marketing plan: A. describes actions to be taken if specific threats or opportunities materialise during the planning period B. specifies the goals to be accomplished in terms of sales volume, market share and profit C. examines the past performance of the product and the elements of its marketing program such as distribution and promotion D. presents a short overview of the issues, objectives, strategy and actions incorporated in the plan and their expected outcomes for quick management review Bloom's: Comprehension Difficulty: Easy Learning Objective: 12.3 Understand the importance of a marketing plan as the foundation for implementing marketing actions. Section: Marketing plans: the foundation for implementing marketing actions 15. Key issues in an annual marketing plan: A. Identify the main opportunities and threats to the product that the plan must deal with in the coming year. B. Summarise the overall strategic approach that will be used to meet the plan's objectives. C. Describe actions to be taken if specific threats or opportunities materialise during the planning period. D. Specify the goals to be accomplished in terms of sales volume, market share and profit. Bloom's: Comprehension Difficulty: Medium Learning Objective: 12.3 Understand the importance of a marketing plan as the foundation for implementing marketing actions. Section: Marketing plans: the foundation for implementing marketing actions 16. Which of the following is typically included in a situation analysis? A. financial objectives B. marketing objectives C. sales forecast D. maintenance strategy Bloom's: Knowledge Difficulty: Medium Learning Objective: 12.3 Understand the importance of a marketing plan as the foundation for implementing marketing actions. Section: Sales forecast and other key assumptions17. Which of the following is the most crucial part of the annual marketing plan for ensuring proper execution? A. action plans B. performance review C. objectives D. executive summary Bloom's: Comprehension Difficulty: Medium Learning Objective: 12.3 Understand the importance of a marketing plan as the foundation for implementing marketing actions. Section: Action plans 18. Which section of an annual marketing plan would contain plans to be implemented if specific threats or opportunities should occur during the planning period? A. action plan B. marketing strategy C. profit-and-loss statement D. contingency plan Bloom's: Knowledge Difficulty: Easy Learning Objective: 12.3 Understand the importance of a marketing plan as the foundation for implementing marketing actions. Section: Contingency plans 19. The ____ form is the least bureaucratic or centralised and the most specialised type of organisation. A. functional B. divisional C. matrix D. global Bloom's: Comprehension Difficulty: Easy Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Matrix organisations 20. A functional structure is likely to be appropriate when: A. Customers all tend to use a narrow range of goods or services to satisfy similar needs. B. Customer segments use goods or services in different ways. C. Customers are highly educated and know exactly what they are looking for. D. Customers are geographically spread in different locations. Bloom's: Application Difficulty: Easy Learning Objective: 12.2 Design appropriate organisational structures and processes for implementing different strategies. Section: Functional organisations21. Marketing objectives are objectives that: A. specify the changes in customer behaviour and levels of performance of various marketing program elements necessary to reach the product's financial objectives B. specify the changes in competing firm behaviour and levels of advertising of various marketing program elements necessary to reach the product's financial objectives C. specify the changes in employee behaviour and levels of performance of various marketing program elements necessary to reach the product's financial objectives D. All of the given answers are correct. Bloom's: Comprehension Difficulty: Medium Learning Objective: 12.3 Understand the importance of a marketing plan as the foundation for implementing marketing actions. Section: Objectives 22. What are the first three sections in a marketing plan? A. analysis of current situation, key issues, objectives B. analysis of current situation, objectives, marketing strategy C. analysis of current situation, marketing strategy, marketing action plans D. SWOT, key issues, objectives 1. Identify the first step in the performance measurement process. A. evaluating data B. setting performance standards C. specifying feedback D. obtaining data Bloom's: Knowledge Difficulty: Medium Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Designing marketing metrics step by step 2. At the product-market entry level, milestone achievement measures include: A. level of awareness B. reduction in marketing costs as a percentage of sales C. per cent of store stocking D. product sales by market segments Bloom's: Knowledge Difficulty: Hard Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Setting standards of performance3. This type of performance measure typically involves comparison of a firm's performance in a given area against the performance of other companies. A. balanced scorecard B. benchmarking C. scenario analysis D. cost benefit analysis Bloom's: Knowledge Difficulty: Easy Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Setting standards of performance 4. Which of the following is probably the single most important measure of performance? A. profitability B. market share C. customer satisfaction< D. productivity Bloom's: Knowledge Difficulty: Easy Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Profitability analysis 5. The costs of occupancy, general management and the management of the sales force are all _____ for a multiproduct business. A. marginal costs B. standard costs C. direct costs D. indirect costs Bloom's: Knowledge Difficulty: Medium Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Profitability analysis 6. Contribution analysis: A. Helps in obtaining an accurate picture of a product's value by allocating all costs to it. B. Involves fixed joint costs that cannot be linked directly to a single unit of analysis. C. Is helpful in determining the yield derived from the application of additional resources. D. Uses both direct and indirect costs to the unit of analysis. Bloom's: Comprehension Difficulty: Hard Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Profitability analysis7. What is activity-based costing? A. It bases costs on the different tasks involved in performing a given activity. B. It identifies costs according to various expense categories. C. It assigns both direct and indirect costs to the unit of analysis. D. It identifies costs according to various income categories. Bloom's: Knowledge Difficulty: Hard Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Profitability analysis 8. What are the basic internal sources of data? A. internet B. sales invoices or other transaction records C. syndicated marketing information services such as Nielsen D. customer comments Bloom's: Knowledge Difficulty: Medium Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Specifying and obtaining feedback data 9. What is the first and foremost objective for marketing? A. the rate of market growth B. the level of sales the company achieves C. the firm's plan of action for each product-market entry D. to make certain the company does not overspend Bloom's: Comprehension Difficulty: Hard Learning Objective: 13.3 Explain what organisations consider in designing decisions for marketing metrics. Section: Who needs what information? 10. Once a business has established its performance standards, its next step is to: A. Develop a system that provides usable and timely feedback data on actual performance. B. B. Invest substantially on customer service training to ensure service standards are met. C. Compose a marketing plan. D. Implement the steps of the action plan. Bloom's: Knowledge Difficulty: Medium Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Designing marketing metrics step by step11. Which of the following is not a variable that helps in finding useful decompositions of the sales data? A. recency B. frequency C. reliability D. monetary value Bloom's: Knowledge Difficulty: Easy Learning Objective: 13.3 Explain what organisations consider in designing decisions for marketing metrics. Section: Sales analysis by customer 12. Advertising managers track advertising costs by: A. attitude change B. new accounts C. action plans D. calls per sales person Bloom's: Knowledge Difficulty: Medium Learning Objective: 13.3 Explain what organisations consider in designing decisions for marketing metrics. Section: Taking corrective action 13. What is the first step in a typical contingency planning process? A. assigning probabilities of being right about the assumptions B. ranking the importance of each assumption C. tracking and monitoring the action plan D. identifying critical assumptions Bloom's: Knowledge Difficulty: Easy Learning Objective: 13.3 Explain what organisations consider in designing decisions for marketing metrics. Section: What contingencies should be planned for? 14. Which stage in a contingency planning process typically follows rank ordering the critical assumptions? A. assigning probabilities of being right about the assumptions B. ranking the importance of each assumption C. tracking and monitoring the action plan D. identifying critical assumptions Bloom's: Knowledge Difficulty: Hard Learning Objective: 13.3 Explain what organisations consider in designing decisions for marketing metrics. Section: What contingencies should be planned for?15. The contingency plan for a company has an alert set at sales declines of 20 per cent or more, compared to the previous month. In which stage of the contingency planning process would such an alert be set? A. specifying response options B. activating the contingency plan C. tracking and monitoring the action plan D. identifying critical assumptions Bloom's: Comprehension Difficulty: Easy Learning Objective: 13.3 Explain what organisations consider in designing decisions for marketing metrics. Section: What contingencies should be planned for? 16. What is the purpose of marketing functions audit? A. Evaluate the adequacy of the systems that develop the firm's product-market entry action plans. B. Evaluate the firm's overall structure and the extent of synergy between the various marketing units. C. Examine the profitability of the company's individual products, markets and key accounts. D. Examine, in detail, the adequacy of the firm's ability to handle each of the marketing-mix elements. Bloom's: Comprehension Difficulty: Medium Learning Objective: 13.4 Understand how important the marketing audit is as a tool for periodically monitoring marketing performance. Section: A tool for periodic assessment of marketing performance: the marketing audit 17. The _____ evaluates the profitability of the company's individual products, markets and key accounts. A. marketing productivity audit B. marketing functions audit C. control system audit D. organisation audit Bloom's: Comprehension Difficulty: Medium Learning Objective: 13.4 Understand how important the marketing audit is as a tool for periodically monitoring marketing performance. Section: Types of audits18. What would be a focus of questions relating to price while examining how adequately the firm handles each of the marketing-mix elements? A. the actions of major competitors B. cost-effectiveness C. functions performed D. sales force compensation Bloom's: Application Difficulty: Medium Learning Objective: 13.4 Understand how important the marketing audit is as a tool for periodically monitoring marketing performance. Section: Types of audits 19. Which of the following is a limitation in using profitability as the sole measure of performance? A. Profit is linked to diminishing returns to scale and is a misrepresentation of true performance. B. Profit is a short-term measure and can be manipulated by taking actions that may prove dysfunctional in the longer term. C. Profit produces externalities, which invariably have a negative effect on the environment. D. Profits cannot account for the network effects that are generated by multiple users in diverse locations. Bloom's: Knowledge Difficulty: Medium Learning Objective: 13.1 Understand how corporations design marketing metrics step by step. Section: Profitability analysis 20. Which of the following is a key issue in developing a set of marketing metrics as part of an overall performance measurement system? A. alignment of metrics with the strategy B. alignment of marketing plan with action plan C. alignment of advertising campaign with distribution D. None of the given answers are correct Bloom's: Application Difficulty: Hard Learning Objective: 13.3 Explain what organisations consider in designing decisions for marketing metrics. Section: Does your system of marketing metrics measure up?21. When implementing strategic monitoring, the key variables to monitor are of the following two types: A. those concerned with external forces, and those concerned with the effects of certain actions taken by the business to implement the strategy B. finance-based variables, product-based variables C. competitor-based variables, internal-based variables D. None of the given answers are correct. [Show More]

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