Deck 2: Company and Marketing Strategy: Partnering to Build Customer Engagement, Value, and Relationships

Question 1

After reviewing the case in the text, the carefully crafted mission statement for Airbnb was presented as .

A) we are not a hotel.
B) belong anywhere.
C) travel adventure defined.
D) cheap rooms around the world making travel affordable.
E) connecting hosts with guests.

Answer 1

B

Question 2

When Howard Schultz returned to assume leaderships at Starbucks in 2007, the company's average transactions per store fell and same-store growth slowed. This was happening despite continued strong growth in the industry. According to the BCG model, Starbucks was a _ .

A) cash cow
B) hero
C) question mark
D) star
E) dog

Answer 2

C

Question 3

In the BCG matrix, _ refer to low-growth, high-share businesses or products.

A) question marks
B) stars
C) heroes
D) dogs
E) cash cows

Answer 3

E

Question 4

Business portfolio analysis is defined as the process in which management _ _.

A) studies the products and strategies of competitors to improve the company's own products
B) assesses the attractiveness of an SBU's market and the strength of its position in the market
C) segments the company's markets to reach target consumers effectively
D) analyzes consumer feedback in order to better position the company's brand image
E) conducts marketing research to evaluate the company's marketing strategy

Question 5

According to the BCG matrix, products or businesses with a low share of market in a high-growth industry are considered _.

A) question marks
B) value chains
C) cash cows
D) dogs
E) stars

Question 6

A _ is purposeful, specifying what an organization wants to accomplish in the larger environment.

A) mission statement
B) marketing strategy
C) market portfolio
D) marketing objective
E) strategic plan

Question 7

An organization's mission statement should emphasize its intentions toward customers and the customer experience the organization seeks to create.

Question 8

The two dimensions the BCG approach uses to evaluate and manage SBUs are _ .

A) market growth rate and market penetration
B) market growth rate and relative market share
C) market growth rate and market development
D) relative market share and market penetration
E) relative market share and product development

Question 9

Cosmetics firm SatinSilk is revamping its mission statement and advertising strategy. The CEO stresses that the new mission statement should be market-oriented rather than product-oriented. Which of the following mission statements will best suit the company?

A) to sell hypoallergenic cosmetics products made only from the finest organic ingredients
B) to give customers the complexion they dream about by providing products suited to their needs
C) to create the best possible products and sell them at the best possible prices
D) to become a market leader in every cosmetics product category
E) to increase our market share in the cosmetics segment and increase profit margins

Question 10

According to the BCG matrix, products or businesses with a high market share in a high-growth market are classified as _ .

A) question marks
B) stars
C) dogs
D) heroes
E) cash cows

Question 11

Which of the following is true of strategic planning in a firm?

A) It deals with adapting the firm to take advantage of changing marketing opportunities.
B) It focuses on the firm's internal environment rather than the external environment.
C) It involves preparing short-term investment objectives at the product level.
D) It occurs at the business-unit, product, and market levels rather than at the corporate level.
E) It deals with maintaining the company's current business ventures.

Question 12

Due to the limitations of the BCG and other formal portfolio planning models, many companies are placing responsibility for strategic planning in the hands of cross-functional teams of divisional managers who are close to their markets. In such organizations, strategic planning is .

A) purposeful
B) centralized
C) informal
D) decentralized
E) limited

Question 13

As identified in the text, what is the Starbucks mission statement?

A) Growing profits by opening new and different stores in more locations throughout the world.
B) To inspire and nurture the human spirit - one person, one cup and one neighbourhood at a time.
C) Starbucks does not believe in a mission statement as it restricts growth and limits opportunities
D) Increase sales at every store by offering new products and lower prices to aggressively gain market share
E) Offering the most delicious, ethically sourced coffee and serve it in with tasty food.

Question 14

"At CL Online, we create customer connectivity, anytime, anywhere" is a product-oriented mission statement.

Question 15

Strategic planning defined: The process of developing and maintaining a strategic fit between the organization's goals and capabilities and its changing marking opportunities.

Question 16

In the BCG growth-share matrix, question marks refer to products or businesses with a .

A) low market share in a market with high growth prospects
B) low market share in a niche market
C) low market share in a market that is set to shrink significantly
D) high market share in a market with a high growth rate
E) greater market share than all their competitors combined in a saturated market

Question 17

Vertigo is an electronics company. According to the BCG matrix, which of the following products of Vertigo would most likely classify as a question mark?

A) Electra-a home entertainment system that has a strong market share in a market that is likely to expand in the future
B) SoLo-a CD player that has a very low market share in a market that is shrinking rapidly
C) Blue-a cell phone that is designed for music lovers and has a very low market share in a market that is growing steadily
D) Kindle Fire-a children's iPad that has a high market share in a market that is not expected to grow significantly
E) SpinDrive-a car audio system that has a high market share in a market that has been growing constantly

Question 18

"At Dodson, we sell shoes" is a market-oriented business definition.

Question 19

Which of the following statements is true in the context of the BCG growth-share matrix?

A) Cash cows typically turn into stars.
B) Stars often need heavy investment to finance their rapid growth in a market.
C) The income from one SBU cannot be used to support other business units.
D) Dogs promise to be large sources of cash.
E) The positions of SBUs in the growth-share matrix rarely change over time.

Question 20

Omni Healthcare's analgesic drug Cetaprin has a 40 percent share in the analgesics market in the country of Terrania. Its closest competitor, Febex, has a 25 percent share in the market, while four other analgesic brands split the remainder. Which statement indicates that Cetaprin is a cash cow according to the BCG matrix?

A) The Terrania market for healthcare products is expanding rapidly.
B) Omni Healthcare often takes money from other strategic business units to support Cetaprin.
C) Febex is rapidly gaining market share over Cetaprin due to aggressive marketing efforts.
D) The demand for analgesic drugs in the Terrania market is expected to maintain a low-growth, high-share status
E) A customer survey shows that Cetaprin users do not prefer it to other analgesics in the market.

Question 21

A firm's decision to identify and develop new markets for existing products is a _ strategy.

A) market penetration
B) market differentiation
C) diversification
D) market development
E) product development

Question 22

McDonalds is globally recognized as a restaurant chain offering a consistent experience and similar foods. Which of the following most likely indicates that McDonalds is following a diversification strategy?

A) McDonalds increases its spending on advertising and promotion.
B) McDonalds develops a new line of pizzas targeting its current market to be sold from its existing locations.
C) McDonalds acquires another chain of fast-food restaurants.
D) McDonalds opens a restaurant in the previously untapped Bora-Bora.
E) McDonalds enters the U.S. market with a line of children's clothing.

Question 23

A strategy for company growth through starting up or acquiring businesses outside the company's current products and markets is called _.

A) diversification
B) product development
C) vertical integration
D) market penetration
E) market development

Question 24

Which of the following companies is using a divesting strategy?

A) Harlow's market share remains steady over two years, and the firm decides to maintain its share at the current level.
B) Getix Computers increases the price of its products in order to maximize short-term profits.
C) Juggernaut Bikes acquires new businesses in order to increase its market share.
D) To achieve a higher market share, LBD Inc. increases investments in advertising and promotion.
E) When sales of its clothing division decline, Blackstone sells the division to a competitor.

Question 25

Before being acquired by Restaurant Brands International in 2014, Tim Horton's focused on different approaches to company growth. In the Product/Market Expansion Grid Tim Horton's successfully applied three
Of the four approaches. The fourth approach, , was avoided.

A) market penetration
B) product development
C) product adaptation
D) market development
E) diversification

Question 26

When a company chooses to harvest a particular strategic business unit, it increases short-term cash flow despite the long-term effect.

Question 27

Both product development strategies and diversification strategies involve .

A) selling in a company's current market
B) developing a new product
C) selling in new as well as existing markets
D) leaving the current market
E) selling a company's current products

Question 28

An SBU can be .

A) a single brand
B) a company division
C) a product line within a division
D) a single product
E) all of the above

Question 29

Lululemon Athletic Wear is a Canadian retail success. While Lululemon has implemented several of these initiatives, which of the following initiatives indicates that the company is following a market development strategy?

A) Lululemon adds a line of leather purses to its offerings in the Canadian market.
B) Lululemon introduces a line of children's clothing to its current target market.
C) Lululemon employs a Ryan Reynolds for a Canadian advertising campaign.
D) Lululemon develops a line of athletic shoes for its current target market.
E) Lululemon introduces its clothing and retail experience in the Indian and Southeast Asian markets.

Question 30

Most people are aware that Mars Incorporated sells popular candy products under a number of brands including M&M's, Snickers, Starburst, Wrigley, the company generates higher sales in than their candy products.

A) dental care products
B) pet care products and services
C) coffee and tea products
D) Sara Lee cakes and desserts
E) Uncle Bens Rice

Question 31

refers to reducing the business portfolio by abandoning products that no longer fit the company's overall strategy.

A) Downsizing
B) Product line extension
C) Vertical integration
D) Market segmentation
E) Diversification

Question 32

Under Armour's recent expansion into the digital personal health and fitness tracking market through acquisitions of three fitness app companies is a strategy.

A) diversification
B) downsizing
C) market development
D) product development
E) market penetration

Question 33

Ford's performance against Toyota depends on the quality of Ford's overall value delivery network versus
Toyota's.

Question 34

Starbucks is experimenting with stand-alone boutique Princi bakery stores, taking the company beyond coffee and snack shops. This is an example of _.

A) product development
B) market development
C) downsizing
D) diversification
E) market penetration

Question 35

Both market penetration and market development strategies primarily involve .

A) modifying the company's product line
B) selling the company's current products
C) developing new products
D) selling in new as well as existing markets
E) leaving the current market

Question 36

Spin Master is a successful Canadian toy manufacturer. Which of the following indicates that the company is following a market penetration strategy?

A) It introduces a line of children's clothing in the United Kingdom.
B) It develops a new line of educational software targeted at the current market.
C) It acquires toy rights for a popular cartoon character to boost its sales.
D) It introduces toy products in the Indian and Southeast Asian markets.
E) It enters the U.S. market with a line of children's clothing.

Question 37

Under Armour increasing its advertising spending and offering an ever-increasing range of styles and colours in its original apparel line is an example of a _ strategy.

A) product development
B) product diversification
C) market development
D) market penetration
E) business harvesting

Question 38

Greyzone, a company that creates customized household furniture, is based in Terrania and is looking to enter other countries as well. The company identifies the country of Nyevka as a good option because the entry barriers for new companies are low in Nyevka. Which statement indicates that Greyzone follows a diversification strategy?

A) Greyzone leaves the Terranian market entirely in order to establish itself in the Nyevkan market with its current products.
B) Noting that Nyevka lacks well-established suppliers of office equipment, Greyzone begins to manufacture and supply office equipment.
C) Greyzone manufactures furniture in Terrania and ships it to Nyevka without setting up outlets in Nyevka.
D) Noting that production costs are lower in Nyevka, Greyzone shifts its production operations entirely to Nyevka.
E) Greyzone does not modify its products for the Nyevkan market.

Question 39

A strategy for company growth that involves increasing sales to current market segments without changing the product is known as .

A) market differentiation
B) market penetration
C) diversification
D) product development
E) market development

Question 40

Market penetration means making fewer sales to current customers without changing original products.

Question 41

A firm's marketing department must partner with other company departments to produce superior value for customers.

Question 42

Marketing department actions can increase purchasing costs, disrupt production schedules, increase inventories, and create budget headaches. Thus, other departments may the marketing department's efforts.

A) resist
B) encourage
C) support
D) develop
E) favour

Question 43

refers to the process of evaluating each market segment's attractiveness and selecting one or more segments to enter.

A) Market diversification
B) Market positioning
C) Market targeting
D) Market mixing
E) Market divesting

Question 44

Marketing needs to identify, evaluate, and select market opportunities and lay down strategies for capturing them.

Question 45

Many companies have dropped formal strategic planning models like the BCG because they can be difficult, time consuming, and costly to implement.

Question 46

The product/market expansion grid, like the BCG matrix, is used to identify growth opportunities.

Question 47

Which of the following best describes product positioning?

A) evaluating each market segment's attractiveness and selecting one or more segments to enter
B) arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products
C) identifying consumer needs and creating a product to meet those needs
D) dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviours
E) differentiating a market offering to create superior customer value

Question 48

Which component of the marketing mix refers to the goods-and-services combination a company offers to its target market?

A) price
B) place
C) position
D) promotion
E) product

Question 49

A company's customer value delivery network does not include members external to the organization.

Question 50

Explain the term "value delivery network."

Question 51

Ferrari sells only 2,200 of its very high-performance cars in North America each year at very high prices. The company is appealing to a specific _.

A) business portfolio
B) market position
C) market segment
D) value delivery network
E) value chain

Question 52

Differentiate between the BCG matrix and the product/market expansion grid.

Question 53

Companies must develop not only strategies for growing their business portfolios but also strategies for downsizing them.

Question 54

According to the Boston Consulting Group approach, how can a company classify its SBUs on a growth-share matrix?

Question 55

A _ is made up of a company, its suppliers, its distributors, and its customers who partner with each other to improve the performance of the entire system.

A) value chain
B) value delivery network
C) growth-share matrix
D) business portfolio
E) shareholder network

Question 56

True Value Hardware relies on its to coordinate and carry out activities that provide shoppers with the hardware and home improvement products they need at affordable prices along with top-notch customer service.

A) suppliers
B) internal value chain
C) distributors
D) internal supply chain
E) portfolio network

Question 57

Traxx is a newly emerging shoe manufacturing company. After extensive market research, Traxx divides its market into professional athletes, "hobbyists" or amateur players, and people who wear shoes as part of their casual attire. Each category has its own needs, traits, and marketing goals. In this scenario, Traxx has engaged in market _ .

A) segmentation
B) penetration
C) positioning
D) development
E) diversification

Question 58

Which of the following best describes market segmentation?

A) arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers
B) dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviours
C) evaluating each market segment's attractiveness and selecting one or more segments to enter
D) differentiating a market offering to create superior customer value
E) identifying consumer needs and creating a product to meet those needs

Question 59

What is a business portfolio? How does a company typically conduct a portfolio analysis?

Question 60

Which of the following best describes the value chain of a company?

A) touchpoints at which a company or brand interacts with its consumers
B) profits earned by the cash cows and stars in the company's business portfolio
C) the collection of businesses and products that make up the company
D) a network made up of the company, its suppliers, and its distributors working together to deliver customer value
E) the series of departments that design, produce, market, deliver, and support the company's products

Question 61

A company can offer greater customer value by either charging lower prices than competitors or offering more benefits to justify higher prices.

Question 62

In a SWOT analysis, which of the following would most likely be considered a strength of a company?

A) an improvement in the company's production technology
B) an increase in consumer interest in the company's products
C) a favourable economic climate that encourages consumption
D) the exit of a competitor from the market
E) higher prices of the company's products resulting from inflation

Question 63

CVS Pharmacy changed its name to CVS Health, reshaping and broadening its lines of products and services to align more appropriately with its revamped "better health" mission. For example, it stopped selling tobacco products altogether. How would this be classified in a SWOT analysis?

A) weakness
B) strength
C) barrier to entry
D) resources
E) threat

Question 64

When viewing the market from a buyer's point of view, "communication" corresponds to the component of the marketing mix.

A) product
B) promotion
C) people
D) price
E) place

Question 65

A potential trade dispute with the United States where the American government is considering restrictions that will affect your company's products represents which of the SWOT elements?

A) Strategies
B) Opportunities
C) Threats
D) Strengths
E) Weaknesses

Question 66

Packaging is an element of the component of a company's marketing mix.

A) price
B) people
C) place
D) product
E) promotion

Question 67

The four Ps model has been challenged because it omits or underemphasizes important activities such as services. It's also been criticized for taking a seller's, rather than a buyer's, viewpoint. The more recent four As framework complements the traditional model and includes .

A) acceptability, affordability, accessibility, and awareness
B) adaptability, affordability, availability, and awareness
C) acceptability, affordability, accessibility, and aptitude
D) adaptability, affordability, accessibility, and awareness
E) adaptability, affordability, availability, and aptitude

Question 68

Services, such as banking, airline, and retailing services, are products too. We call them service products.

Question 69

Nike's goal to increase sales of its running shoes by 25 percent during the first six months of the new fiscal year is an example of a _.

A) marketing objective
B) marketing strategy
C) differentiation objective
D) target market strategy
E) positioning objective

Question 70

The process that turns marketing plans into marketing actions to accomplish strategic marketing objectives is called marketing ______.

A) implementation
B) analysis
C) design
D) control
E) planning

Question 71

Discuss the four Ps of the typical marketing mix. Some people consider that there should be more than four marketing mix elements. Suggest two additional aspects that the marketing mix could include.

Question 72

Managing the marketing function begins with a complete analysis of the company's situation. A thorough guides decision making.

A) situation analysis
B) industry overview
C) portfolio analysis
D) SWOT analysis
E) internal assessment

Question 73

In the marketing mix, product refers to activities that communicate the merits of a product and persuade target customers to buy it.

Question 74

In a SWOT analysis, which of the following would be considered a weakness of a company?

A) falling consumer interest in its products
B) inflation that leads to higher prices of the company's products
C) an unfavourable economic climate that discourages consumption
D) obsolete technologies used by the company
E) the exit of a competitor from the market

Question 75

After suffering from lower occupancy rates, shrinking market share, and a tired brand, Holiday Inn successfully grew by creating specific brands (Crown Plaza, Intercontinental, Express and more) to serve different customer segments.

Question 76

In the four Ps of the marketing mix, promotion refers solely to advertising.

Question 77

In a SWOT analysis, refer to favourable factors or trends in the external environment that a company may be able to exploit to its advantage.

A) strategies
B) controls
C) strengths
D) opportunities
E) threats

Question 78

Toyota manufacturers and sells cars globally, including manufacturing and assembly plants in Cambridge and Woodstock Ontario. Once assembled at these plants, the cars are transported to Toyota dealerships to be sold. The process of shipping the cars from factory to dealership falls under which of the four P's?

A) Passage
B) Product
C) Price
D) Place
E) Promotion

Question 79

In the new four As framework, Accessibility replaces Price.

Question 80

A popular promotion offered by the Ford Motor Company often advertises employee discounts for all purchasers of Ford vehicles. While the activity is related to promotion, the marketing mix being addressed is .

A) product
B) price
C) packaging
D) place
E) public relations