Ch3 Exam Prep Elements Of Marketing Strategy, Planning, And

Marketing Management, 3e (Marshall)

Chapter 3 Elements of Marketing Strategy, Planning, and Competition

1) From a customer's perspective, value is the ratio of the bundle of benefits a customer receives from an offering compared to the costs incurred by the customer in acquiring that bundle of benefits.

2) Value is some type of utility that a company and its products provide for customers.

3) Starbucks is known to have shops located in close proximity to enable customers to shop conveniently. It appears that the coffee shop chain is offering place utility.

4) Samsung's first value proposition when the brand was launched in the United States was price and functionality.

5) When a firm communicates the value proposition of its products to customers, the value message only includes the benefits of the product.

6) For firms interested in building long-term customer relationships, having satisfied customers is enough to ensure the relationship is going to last.

7) Outbound logistics refers to the distribution of products.

8) As long as all activities in the value chain are working well, managers do not need to be concerned with aligning the activities.

9) The last element in the value chain is margin, which refers to profit made by the firm.

10) At the strategic level, marketing (little m) serves as the driver of business strategy.

11) According to the BCG matrix, a business that is classified as a star has high growth and low market share.

12) According to the BCG matrix, a business that is classified as a dog has high growth and high market share.

13) The GE Business Screen portfolio model evaluates businesses on the dimensions of market attractiveness and business position.

14) In the GE Business Screen model, the business position dimension looks at factors like government regulations, sensitivity to economic trends, and size of the market.

15) A mission statement does NOT include a discussion of the firm's strategic vision.

16) Goals are broad statements of generally desired accomplishments in support of the firm's mission statement.

17) Strategy has two key phases: formulation and execution.

18) Companies in some business cultures based outside the United States seem to have less pressure to achieve high levels of growth.

19) A firm's competitive strategy leads it to decide if it can grow and if not, how to survive through stability or retrenchment.

20) Internal environmental factors are all under the firm's control.

21) Market penetration strategies allow the firm to introduce new products to new customers, often including international markets.

22) Market development strategies allow a firm to invest additional resources to have existing customers consume new products.

23) When Christy developed her marketing plan for her new store, she kept in mind that conditions can change, so her plan would also change. This demonstrates the importance of staying strategic, but also staying on top of the tactical, in the tips for a successful marketing planning experience.

24) Joelle bought a new Coach purse for herself as a birthday present. She had never spent that much on a purse, but decided it was worth it because it was so elegant. This demonstrates how a customer's perception of ________ can influence buying behavior.

A) exchange

B) utility

C) place

D) competition

E) value

25) Form utility is ________.

A) marketing's task in creating an offering that has value

B) production's task in creating an offering that is desired by the market

C) the firm's task in deciding where to distribute the product

D) created when products are available to customers at a convenient location

E) that which allows for transfer of the product ownership from seller to buyer

26) Although Michael knew he couldn't really afford the Mercedes, he wanted it anyway. The want-satisfying power of a good is called ________.

A) exchange

B) value

C) necessity

D) strategy

E) utility

27) Utility created when a firm converts raw materials into finished products that are desired by the market is called ________ utility.

A) time

B) form

C) place

D) ownership

E) price

28) Which of the following is TRUE of utility?

A) The three utilities—form, price, and ownership—are created by marketing.

B) Utility is defined as a ratio of benefits to costs, as viewed from the eyes of the beholder.

C) Form utility is created when products are available to customers at a convenient location.

D) The four major kinds of utility are form, time, place, and ownership.

E) Place utility is created when the firm converts raw materials into finished products that are desired by the market.

29) The concept of the value chain was created by ________.

A) Fred Wiserma

B) Michael Porter

C) Jim Collins

D) Peter Drucker

E) David Hunger

30) Which of the following is NOT one of the five primary activities in the value chain?

A) inbound logistics

B) operations

C) technology procurement

D) outbound logistics

E) marketing and sales

31) A window manufacturer has trouble getting glass for its high-end windows. Of the five primary activities in the value chain, this problem is most likely to occur in ________.

A) inbound logistics

B) operations

C) outbound logistics

D) marketing and sales

E) service

32) Sean attributes the success of his video game arcade to advertising on the most popular website for gamers. Recently, the website raised ad prices, so Sean has cut his advertising in half. He believes that positive word-of-mouth will be enough now that his game is well established. However, sales are slipping. Of the five primary activities in the value chain, this problem is most likely to occur in ________.

A) inbound logistics

B) operations

C) outbound logistics

D) marketing and sales

E) service

33) Dave is a close-up magician who is famous for his card tricks. He creates and sells DVDs of his magic tricks. Lately he has been having some trouble getting the DVDs produced in a timely manner. Of the five primary activities in the value chain, this problem is most likely to occur in ________.

A) inbound logistics

B) operations

C) outbound logistics

D) marketing and sales

E) service

34) Mark and Gregory are partners in a manufacturing firm that employs over 1,500 people. Recently, employees have been complaining that they were not told of changes in health insurance coverage and premiums. To which of the following support activities of the value chain can this problem be attributed?

A) firm infrastructure

B) human resource management

C) technology development

D) inbound logistics

E) procurement

35) Mammoth Foods, a major agricultural corporation, recently purchased MJS Organic Foods Co. MJS was established six years ago and has become a major supplier to restaurants in the northeastern United States. The organic herbs, vegetables, and fruit market is expected to have a double-digit growth rate over the next decade. Under the Boston Consulting Group (BCG) Growth-Share Matrix, MJS would most likely be classified as a ________.

A) star

B) cash cow

C) dog

D) problem child

E) top gun

36) In the BCG matrix, ________ are characterized by high share and low growth and are the key sources of internal cash generation for a firm.

A) stars

B) cash cows

C) dogs

D) problem children

E) top guns

37) In the BCG matrix, firms categorized as problem children are characterized by ________.

A) high share and high growth

B) low share and low growth

C) high share and low growth

D) low share and high growth

E) moderate share and moderate growth

38) Lately the demand for building materials has dropped due to the slowdown in new housing construction. Woods Corp. is thinking of closing its fine wood division that produces mahogany and cherry lumber for building cabinets and other applications. Under the Boston Consulting Group Growth-Share Matrix, the fine wood division would most likely be classified as a ________.

A) star

B) cash cow

C) dog

D) problem child

E) top gun

39) Hot and Cold Corp. makes disposable coffee and soft drink cups for use in fast-food restaurants, hospitals, convenience stores, and the like. The company is working on a sturdy new product that will biodegrade within five years of being put in a landfill. According to the BCG matrix, this promising new product line would most likely be classified as a ________.

A) star

B) cash cow

C) dog

D) problem child

E) question mark

40) Green Scene Co., a struggling start-up firm that needs a huge cash injection, has an environmentally friendly pesticide that is approved for use by commercial organic farmers. The pesticide is made from all-natural ingredients and has great potential. A small investment firm has injected cash in Green Scene. In the context of the BCG matrix, Green Scene is most likely considered a ________.

A) star

B) cash cow

C) dog

D) question mark

E) top gun

41) Mega-Big Corp. has a small strategic business unit (SBU) that produces a component vital to the manufacturers of automobiles and has been extremely profitable for 18 years. The SBU acts as a key source of income for the firm. In the context of the BCG matrix, Mega-Big Corp. is most likely considered a ________.

A) question mark

B) cash cow

C) dog

D) problem child

E) top gun

42) Mega-Big Corp. is interested in buying Soft works, a medical software firm. Soft works is highly regarded by medical practices for ease of use, but hasn't sold well. Two software engineers started the company, but they have made risky financial and poor management decisions. Mega Corp. believes that with proper management the software firm will become an industry leader. In the context of the BCG matrix, Soft works is most likely considered a ________.

A) star

B) cash cow

C) dog

D) problem child

E) top gun

43) Which of the following is NOT included in the business position factors of the GE Business Screen?

A) organization

B) growth

C) patents

D) governmental regulations

E) marketing

44) A ________ articulates an organization's reason for existence and defines the unique purpose that sets it apart from competitors and identifies the scope of the company's operations, products, and markets.

A) mission statement

B) functional-level plan

C) value chain

D) marketing strategy

E) value proposition

45) Which of the following is considered an objective?

A) to deliver the best customer service

B) to practice responsible financial management

C) to increase revenue by 15 to 20 percent in each of the next five years

D) to hire the best people

E) to minimize waste

46) Which of the following is most likely to be considered a goal rather than an objective?

A) to improve customer satisfaction ratings to 95 percent

B) to increase ROI by 20 percent

C) to be the leader in one's field

D) to reduce the cost of scrap material to less than one percent of total manufacturing cost

E) to get five new distributors

47) Growth, stability, and retrenchment refer to a firm's position relating to its ________ strategy.

A) specific

B) generic

C) future

D) diversification

E) differentiation

48) The Hernandez brothers manufacture trailers that are used by lawn service companies. The company was started in Texas by their father with one production site and four sales and service locations. Since the sons took over, they have expanded in the last 12 years to include 26 sales and service centers throughout the southeast. In this case, the company is most likely using a generic business strategy based on ________.

A) retrenchment

B) stability

C) product differentiation

D) diversification

E) growth

49) Go Fish Sushi restaurants are primarily located in malls. The restaurants had rapid growth in their first seven years. The owner realizes that adding more restaurants would make it impossible to monitor operations. Therefore, he decides to continue current activities without making major changes. In this case, the owner is most likely pursuing a generic strategy of ________.

A) retrenchment

B) stability

C) diversification

D) growth

E) differentiation

50) Zenith Homebuilders used to purchase many building lots and erect spec homes (i.e., it gambled that the demand for new houses would be so high that they would sell easily). Since the real estate slowdown, it builds homes only when owners are under contract. In this case, the company is most likely pursuing a generic business strategy of ________.

A) retrenchment

B) stability

C) diversification

D) growth

E) differentiation

51) The activities a firm does better than its competitors are known as ________.

A) core competencies

B) strategic alignment

C) distinctive competencies

D) growth indicators

E) competitive indicators

52) Which of the following is NOT one of the four strategic types of firms proposed by Miles and Snow?

A) prospectors

B) analyzers

C) defenders

D) reactors

E) compromisers

53) Today many retailers create apps that customers can download to their smartphones or tablets to be up-to-date on the company's offerings. In the context of situation analysis, which of the following macro-level external environmental factors does this exemplify?

A) Economic factors

B) Natural factors

C) Technological factors

D) Political, legal, ethical factors

E) Sociocultural/demographic factors

54) According to the 2010 U.S. Census, Asian Americans are a high-income, fast-growing racial group in America. In the context of situation analysis, under which of the following macro-level external environmental factors will this be included?

A) natural factors

B) legal and ethical issues

C) technological advancements

D) sociocultural/demographic factors

E) firm structure and systems

55) Automobile manufacturers must comply with regulations set by the National Transportation and Safety Board. In the context of situation analysis, which of the following macro-level external environmental factors does this exemplify?

A) sociocultural/demographic

B) firm structure and systems

C) political, legal, and ethical

D) firm resources

E) threat of new entrants

56) In the context of situation analysis, which of the following is a category for analysis in the internal environment?

A) political, legal, and ethical

B) technological

C) firm resources

D) threat of new entrants

E) sociocultural/demographic

57) What can impact the competitive nature of an industry through the ability to raise prices or affect the quality of inbound goods and services?

A) suppliers

B) buyers

C) new entrants

D) substitute products

E) retailers

58) Which of the following competitive forces is NOT addressed directly by Michael Porter?

A) threat of new entrants

B) threat of substitute products

C) relative power of other stakeholders

D) bargaining power of suppliers

E) rivalry among existing firms

59) Which of the following is NOT a major category for analysis in the internal environment?

A) firm resources

B) firm leadership

C) firm culture

D) rivalry among existing firms

E) firm structure and systems

60) A SWOT analysis of a firm is least likely to ________.

A) reveal weaknesses

B) look at internal strengths

C) include external analysis

D) identify potential opportunities and threats

E) suggest solutions to problems

61) The best place in a SWOT analysis to identify problems with hurricanes, earthquakes, major snowfalls, and other natural phenomena is ________.

A) external opportunities

B) external threats

C) internal opportunities

D) internal strengths

E) internal weaknesses

62) The best place in a SWOT analysis to list the availability of credit for a firm seeking to expand through new construction of real estate is ________.

A) external opportunities

B) external threats

C) internal opportunities

D) internal strengths

E) internal weaknesses

63) The best place in a SWOT analysis to list a highly-competent workforce is ________.

A) external opportunities

B) external threats

C) internal opportunities

D) internal strengths

E) internal weaknesses

64) The best place in a SWOT analysis for an airline to identify the possibility of acquiring a competitor is ________.

A) external opportunities

B) external threats

C) internal opportunities

D) internal strengths

E) internal weaknesses

65) The best place in a SWOT analysis for a wristwatch manufacturer to identify the presence of competitive substitute products is ________.

A) external opportunities

B) external threats

C) internal opportunities

D) internal strengths

E) internal weaknesses

66) Goals and objectives should be set ________.

A) at the beginning of marketing planning

B) at the end of the situation analysis

C) after marketing strategies are fixed

D) after completion of market research, situation analysis, and competitor analysis

E) during SWOT analysis while identifying external opportunities and threats

67) Victor Inc., a producer of headphones used with cell phones and MP3 players, uses contract manufacturing overseas. The firm is concerned that tariffs may be increased. Under which component of situation analysis will an examination of this issue be found?

A) economic factors

B) natural factors

C) competitive factors

D) political, legal, and ethical factors

E) logistical factors

68) Malala, the marketing manager of an automobile dealership, is crafting a SWOT analysis. In this case, she should include the downturn in the U.S. economy and tightening of the credit markets under ________.

A) strengths

B) threats

C) opportunities

D) strategies

E) weaknesses

69) Maria, the marketing manager of an automobile dealership, is crafting a SWOT analysis. In this case, she should list competitors that have gone bankrupt under ________.

A) strengths

B) threats

C) opportunities

D) strategies

E) weaknesses

70) Lin Wai's company, New Home Builders Corp., specializes in designing homes that have wide hallways and walk-in showers that could accommodate the need to use a wheelchair or walker, and other amenities that allow couples to remain in their homes as they age. The company's strong value proposition has allowed it to maintain steady market share in a weak housing market. In the context of SWOT analysis, a discussion of this relative advantage would be included under ________.

A) strengths

B) threats

C) opportunities

D) strategies

E) weaknesses

71) Open Sesame is a chain of Thai restaurants located in the western United States. The marketing manager has discovered that there is a growing demand for Spanish food, and the appetite for Asian food is declining. In the context of SWOT analysis, this information would be included under ________.

A) strengths

B) threats

C) opportunities

D) strategies

E) weaknesses

72) The marketing manager at Little Red Architects, a firm that specializes in the design of school buildings, discovered a glitch in the software that the firm uses. As a result, some of its most recent projects will come in over budget. In the context of SWOT analysis, a discussion of this would be included under ________.

A) strengths

B) threats

C) opportunities

D) strategies

E) weaknesses

73) Time Express, a well-established North American delivery service, wants to expand service into Central and South America. According to Igor Ansoff's Product-Market Matrix, this is classified as the ________ strategy.

A) market diversification

B) product differentiation

C) market penetration

D) product development

E) market development

74) Biz Solutions has 12 call centers worldwide handling customer service issues for a variety of companies. The firm is considering the purchase of a software firm that serves the oil and gas industry. According to Igor Ansoff's Product-Market Matrix, this is an example of the ________ strategy.

A) market diversification

B) product differentiation

C) market penetration

D) product development

E) market development

75) When Sunshine Inc., a cosmetics manufacturer, introduced an additional line of perfumes, the response from its existing customers was good. According to Igor Ansoff's Product-Market Matrix, this is an example of the ________ strategy.

A) market diversification

B) product differentiation

C) market penetration

D) product development

E) market development

76) Bliss Massage Therapy Center maintains a database of over 700 clients and sends each one a special discount offer in the month of his or her birthday. Managers hope that as existing customers use the discount, they will see an overall growth in sales. According to Igor Ansoff's Product-Market Matrix, this is an example of the ________ strategy.

A) market diversification

B) product differentiation

C) market penetration

D) product development

E) market development

77) Gabriel, vice president of marketing for Big Screen Televisions, wants the company to offer a DVD player, a product the company doesn't offer now. He thinks that the firm has many brand-loyal customers who would buy it. According to Igor Ansoff's Product-Market Matrix, this is an example of the ________ strategy.

A) market diversification

B) product differentiation

C) market penetration

D) product development

E) market development

78) Inga, marketing manager at Sunshine, a professional preschool center, thinks the firm should start an after-school program for its current clients. This makes sense as she wants to extend the trusting relationship already established with parents and children. According to Igor Ansoff's Product-Market Matrix, this is an example of the ________ strategy.

A) market diversification

B) product differentiation

C) market penetration

D) product development

E) market development

79) Jamal's boss wants him to travel to Canada to do some research on good locations for their retail stores, which they are planning to open in Montreal and Ottawa. The firm currently operates 278 stores in the United States. According to Igor Ansoff's Product-Market Matrix, the extension into a new geographic region is an example of the ________ strategy.

A) market diversification

B) product differentiation

C) market penetration

D) product development

E) market development

80) The process of measuring marketing results and adjusting the marketing plan as needed is called marketing ________.

A) control

B) metrics

C) management

D) strategy

E) planning

81) Which of the following are often described in terms of a separate plan for a worst-case, best-case, and expected-case performance against the forecast?

A) action plans

B) operational plans

C) functional-level plans

D) contingency plans

E) strategic plans

82) In a marketing plan, every strategy must include an implementation element. These are sometimes called ________.

A) strategic plans

B) marketing metrics

C) value propositions

D) action plans

E) marketing channels

83) Which of the following is LEAST likely to be included under action plans?

A) timing

B) forecasts and budgets

C) individuals responsible for various aspects of implementation

D) resources necessary to make the strategy happen

E) separate plans for worst-case performance against the forecast

84) One part of a marketing plan should identify what to do if things go wrong. This section is called ________ planning.

A) contingency

B) strategic

C) operational

D) action

E) tactical

85) Which of the following helps avoid scrambling to decide how to adjust marketing strategies when performance against a forecast is higher or lower than expected?

A) marketing metrics

B) product development strategies

C) core competencies

D) support activities

E) contingency plans

86) Teel is a plumbing fixture manufacturer's salesperson. He sells to wholesalers, homebuilders, and retailers. His marketing plan calls for going to four trade shows a year. He recently found out that there would be a new Home Show aimed at consumers in his territory and he wants to attend. His boss gives him permission to attend the additional show. Which of the following concepts in successful marketing planning is exemplified in this scenario?

A) Stay flexible.

B) Utilize input, but don't become paralyzed by information and analysis.

C) Don't underestimate the implementation part of the plan.

D) Stay strategic, but also stay on top of the tactical.

E) Give yourself and your people room to fail and try again.

87) Mary's firm has delayed making a decision on acquiring a new product line because her marketing team members took more than three months to analyze the numbers. Which of the following tips for successful marketing planning experience did the firm fail to use?

A) Stay inflexible.

B) Utilize input, but don't become paralyzed by information and analysis.

C) Don't underestimate the implementation part of the plan.

D) Stay strategic, but also stay on top of the tactical.

E) Give yourself and your people room to fail and try again.

88) Tyler's event planning company hired a new marketing assistant who focuses only on long-term organizational goals and objectives, ignoring the functional or operational level aspects of planning. For having a successful marketing planning experience, in which concept should the new assistant be trained?

A) Stay flexible.

B) Utilize input, but don't become paralyzed by information and analysis.

C) Don't underestimate the implementation part of the plan.

D) Stay strategic, but also stay on top of the tactical.

E) Give yourself and your people room to fail and try again.

89) Describe the four support activities and the five primary activities in Porter's value chain.

90) Explain the Boston Consulting Group Growth-Share Matrix. What are the strengths and weaknesses of this method? Give examples of each of the four cells and their strategy recommendations.

91) What are the major categories for analysis within the external environment? Give an example of each.