Deck 2: Strategic Planning for Competitive Advantage

Question 1

Developing a cost competitive advantage can enable a firm to deliver superior customer value.

Answer 1

True

Question 2

Berkshire Hathaway Inc.,a large conglomerate holding company,owns a several insurance companies,a large chain of jewelry stores,and has recently purchased the BNSF Railway.Berkshire Hathaway uses a market penetration strategy.

Answer 2

False
Berkshire Hathaway uses a diversification strategy.

Question 3

The development of a target market strategy begins with a marketing audit.

Answer 3

False
The development of a target market strategy begins with a market opportunity analysis (MOA).

Question 4

When the Internet auction company eBay opened a version of the company called eBayfrance for the French market,that was an example of market penetration.

Question 5

The company's objective is to increase sales next year.This is an example of a well-stated objective.

Question 6

The marketing plan is a written document that acts as a guidebook of marketing activities for a marketing manager.

Question 7

The Home Depot's introduction of new fuel centers at some of its stores allows the Home Depot to better serve its current customers,such as contractors with large trucks who no longer need to go somewhere else to refuel.This is an example of product development.

Question 8

A market penetration strategy entails the creation of new products for current customers.

Question 9

Environmental scanning entails the collection and analysis of information about factors that may affect the organization as well as the identification of market opportunities and threats.

Question 10

As marketers gain more experience in marketing a product,costs tend to decrease,which is an example of the maturity effect.

Question 11

The manufacturer of Macho brand martial arts products was implementing a strategic plan when it sponsored a local karate tournament for teenagers.

Question 12

Marketing strategy involves the activities of selecting and describing one or more target markets and developing and maintaining a marketing mix that will produce mutually satisfying exchanges with target markets.

Question 13

When a florist shop begins to sell burial caskets to its customers,it is engaged in product development.

Question 14

A firm's mission statement should answer the question,"What products do we produce best?"

Question 15

A production costs analysis could be a part of a company's SWOT analysis.

Question 16

A competitive advantage is the set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition.

Question 17

A portfolio matrix is a tool for allocating resources among products or strategic business units on the basis of relative market share and degree of innovation.

Question 18

A diversification strategy entails increasing sales by introducing new products into new markets.

Question 19

Niche competitive advantages are quite common.

Question 20

To be useful,marketing objectives should meet four criteria: realistic,measurable,time-specific,and based on sales.

Question 21

A written document that acts as a guidebook of marketing activities for the marketing manager is known as the _____.

A) strategy document
B) marketing plan
C) vision statement
D) mission statement
E) strategic plan

Question 22

Earl is starting a new bank.Before their opening day Earl had a meeting with all employees.He discussed their mission,defined objectives for the bank for the coming years and shared who their target market is.He talked about their product offerings and where their future branches would be located.Earl is sharing the bank's _____.

A) reengineering
B) hierarchical restructuring
C) financial analysis
D) marketing plan
E) strategic contingency planning

Question 23

_____ is the process of anticipating events and determining strategies to achieve organizational objectives.

A) Planning
B) Portfolio evaluation
C) Forecasting
D) Implementation
E) Evaluation

Question 24

A statement of the firm's business based on a careful analysis of benefits sought by present and potential customers and an analysis of existing and anticipated environmental conditions is known as a(n):

A) business audit
B) marketing plan
C) mission statement
D) environmental focus
E) portfolio matrix

Question 25

_____ occurs when a business is defined in terms of goods and services rather than by the benefits customers seek from it.

A) Synergy
B) Tunnel vision
C) Narrowcasting
D) Unempowerment
E) Marketing myopia

Question 26

The most critical element for successful strategic planning is top management's support and participation.

Question 27

PepsiCo's annual report has the following statement: "Our business is to increase the value of our shareholder's investment.We do this through sales growth,cost controls and wise investment of resources.We believe our commercial success depends upon offering quality and value to our consumers and customers; providing products that are safe,wholesome,economically efficient and environmentally sound; and providing a fair return to our investors while adhering to the highest standards of integrity." This statement is an example of PepsiCo's:

A) marketing mix strategy
B) quantifiable goal
C) mission statement
D) statement of economic potential
E) market segmentation strategy

Question 28

The _____ answers the question,"What business are we in,and where are we going?"

A) mission statement
B) financial statement
C) situation analysis
D) market strategy
E) strategic plan

Question 29

The focus of an organization's mission statement should be on:

A) the products it wishes to sell
B) the market it wishes to serve
C) its social responsibilities
D) the desires of government regulators
E) technologies it understands well

Question 30

Strategic planning is most effective when managers view it as an annual exercise.

Question 31

Strategic plans require:

A) long-term resource commitments
B) a change in organizational structure
C) the addition of new personnel
D) new product development
E) changes in prices

Question 32

Marketing plans should be written to do all of the following EXCEPT:

A) compare actual and expected performance
B) provide clearly stated activities
C) create common goals for employees to work toward
D) allow managers to enter the marketplace with an awareness of possibilities and problems
E) control the elements of the external marketing environment

Question 33

Heinz has announced that they plan to grow the company through an accelerated push into emerging markets such as China,Indonesia,and India in the next ten years.This is an example of:

A) tactical objectifying
B) contingency plan
C) strategic planning
D) marketing implementation
E) horizon planning

Question 34

Since gas prices have soared and consumers have cut back on their spending on new trucks and SUVs Ford Motor Corporation is transforming several of its plants to create small cars.Ford has engaged in:

A) benchmarking
B) tactical resource realignment
C) alternative selection
D) portfolio evaluation
E) strategic planning

Question 35

With hospitals nationwide facing budget cuts and slimmer profit margins,Dekalb County's Medical Center decided to cash in on one of the most consistently profitable services--delivering babies.It initiated a three-year project to build a $55 million state-of-the-art women's center with 18 labor and delivery suites.When the hospital decided to commit its resources to obstetrics,it was engaging in:

A) benchmarking
B) alternative problem solving
C) strategic planning
D) portfolio evaluation
E) tactical control

Question 36

Typically,the development of the marketing mix starts with determining the promotion for a product.

Question 37

All of the following are elements of the marketing plan EXCEPT:

A) business mission statement
B) situation analysis
C) target market strategy
D) marketing mix
E) portfolio analysis

Question 38

A marketing audit helps management allocate marketing resources efficiently.

Question 39

_____ is the managerial process of creating and maintaining a fit between the organization's objectives and resources and evolving market opportunities.

A) Tactical management
B) The market audit
C) Functional planning
D) Environmental scanning
E) Strategic planning

Question 40

The four Ps of the marketing mix are product,planning,promotion,and price.

Question 41

A _____ is defined as a statement of what is to be accomplished through marketing activities.

A) mission statement
B) business plan
C) marketing objective
D) goal-driven directive
E) marketing criteria

Question 42

A _____ is a study conducted by an organization to identify its internal strengths and weaknesses and also examine external opportunities and threats.

A) situation analysis
B) marketing audit
C) trend analysis
D) strategic alternative selection
E) competitive advantage audit

Question 43

Subgroups of a single business or a collection of related businesses within a larger organization are referred to as:

A) strategic marketing organizations
B) strategic subgroups
C) market segments
D) business segments
E) strategic business units

Question 44

Yildiz Holding of Turkey purchased Godiva Chocolates from Campbell's Soup Company.Campbell's sold one of its:

A) strategic business units (SBUs)
B) strategic alliances
C) action programs
D) transactional units
E) synergistic divisions

Question 45

Of the following,what is the most useful objective for Purina cat food?

A) To increase sales of Purina brand cat food by 15 percent over 2010 sales of $300 million.
B) To increase sales of Purina brand cat food between January 1,2010 and December 31,2010.
C) To increase sales of Purina brand cat food from $300 million to $345 million.
D) To increase sales of Purina Brand cat food.
E) To increase sales of Purina pet food.

Question 46

A popular technique for managing a large organization with different technologies and markets is to divide it into:

A) strategic business units
B) different technologies
C) strategic target markets
D) design matrices
E) tactical segments

Question 47

An SBU:

A) competes with the same companies as the other SBUs in the parent organization
B) shares the same mission with all the other SBUs in the parent organization
C) controls its business independent of other SBUs in the organization
D) usually benefits from the combined corporate raw materials purchases
E) still has strategic planning performed back at corporate headquarters

Question 48

Briggs and Stratton is a Southeastern company that makes small engines.The company is looking at customer trends,its competitors,and the economy to see if there are any threats or opportunities on the horizon.It has also examined its production policies and sales histories to determine its strengths and weaknesses.Briggs & Stratton is conducting a(n):

A) environmental test
B) market audit
C) trend analysis
D) situation analysis
E) competitive advantage search

Question 49

By defining its business as "printing books" instead of "empowering imaginations," a children's book publishing company would more than likely experience:

A) market synergy
B) product entropy
C) market harvesting
D) nonspecific strategic planning
E) marketing myopia

Question 50

Coca-Cola drink vending machines are found all over the world.The newest machines have an interactive screen that runs advertisements and allows users to obtain free photos of themselves and ringtones after they have bought a drink.Critics of these new vending machines are concerned that entertaining technology is being used to market sugary products.In terms of a SWOT analysis,this concern would be an example of a(n):

A) weakness
B) strength
C) advantage
D) opportunity
E) threat

Question 51

Tub King is a small company that refinishes antique claw foot bathtubs,antique sinks,and provides training for bathtub refinishing.The company's management is currently conducting a formal study of its current strengths and weaknesses by looking at the company's profit and sales histories and searching for opportunities and threats by studying consumer trends.Tub King is conducting a(n):

A) marketing audit
B) SWOT analysis
C) environmental scan
D) market differentiation scan
E) strategic window search

Question 52

All of the following are functions served by objectives EXCEPT:

A) communicate philosophies and provide direction
B) motivate employees
C) clarify executives' thinking
D) form the basis for control
E) guarantee market performance

Question 53

Chrysler has a financial unit that is responsible for vehicle leases to consumers.It has a distinct mission,control over its resources,and plans independent of the other divisions of Chrysler.This financial unit is an example of a(n):

A) organizational level
B) SWOT
C) secure business unit
D) business sales unit
E) strategic business unit

Question 54

Smucker's purchased Folgers Coffee in 2008.The option to buy Folgers represented a(n)_____ to Smucker's.

A) opportunity
B) strength
C) weakness
D) threat
E) burden

Question 55

The acronym SBU refers to:

A) stock in business units
B) strategic business unit
C) standard business utilization
D) strategic barter units
E) samples by units

Question 56

The SWOT acronym refers to a firm's analysis of its:

A) sales,width of product mix,observations,and technology
B) situations,wealth,organizational strengths,and target markets
C) strengths,weaknesses,opportunities,and threats
D) service levels,willingness to spend,organizational culture,and total revenues
E) strategies,willingness to change,objectives,and trends

Question 57

Coca-Cola drink vending machines are found all over the world.The newest machines have an interactive screen that runs advertisements and allows users to obtain free photos of themselves and ringtones after they have bought a drink.The reason for the introduction of this new style vending machine is to "allow the company to interact more directly with its customers." According to a SWOT analysis,the technology used by these machines is an example of a(n):

A) strength because it is part of Coke's external environment
B) advantage because it is part of Coke's marketing environment
C) weakness because Coke cannot control technology
D) opportunity because it is part of Coke's external environment
E) benefit because Coke has the resources to make use of the new technology

Question 58

All of the following are characteristics of a good objective EXCEPT:

A) profitable
B) realistic
C) measurable
D) time-specific
E) consistent

Question 59

_____ is defined as the collection and interpretation of information about forces,events,and relationships in the external environment that may affect the organization or the implementation of the marketing plan.

A) Market sampling
B) An internal audit
C) Opportunity analysis
D) Environmental scanning
E) Stakeholder analysis

Question 60

Until spun off in 2007,Kraft was part of Altria Group,Inc.Kraft had its own management team,mission statement,and target markets different from Altria Group,Inc.Kraft was a _____ of Altria Group,Inc.

A) product market niche
B) diversified division
C) heterogeneous element
D) strategic alliance
E) strategic business unit

Question 61

iTunes has a(n)_____ as they have exclusive agreements with some of the most sought after music corporations that other digital music stores do not have.

A) targeted market position
B) sustainable competitive advantage
C) strategic focus
D) situational strength
E) opportunistic privilege

Question 62

An advantage that cannot be copied by the competition is called a(n)_____ competitive advantage.

A) sustainable
B) monopolistic
C) primary
D) unique
E) dominant

Question 63

Yuengling is the oldest brewery in the United States.It was founded in 1827 in a time when small breweries dotted the nation.The brewery only sells in a ten state area on the eastern seaboard.For over 170 years,this strategy has given the brewery a:

A) brand name strategy
B) niche competitive advantage
C) price differentiation advantage
D) marketing competitive advantage
E) sustainable competitive advantage

Question 64

Technol Medical Products makes specialty face masks to shield health-care workers from infection.Because it focuses on this narrow market,it is able to outsell its primary competitors--3M and Johnson & Johnson.Technol Medical Products has a(n):

A) aggregated positioning strategy
B) demarketing focus
C) heterogeneous target marketing strategy
D) cost competitive advantage
E) niche competitive advantage

Question 65

Each labor and delivery room at Dekalb County's new Medical Center has hardwood floors,soft lighting,and mission-style furniture.The facility also features a stone fireplace in the lobby,a bistro-style restaurant,and VIP suites for discerning mothers-to-be.This unique design and furnishings give the Medical Center a:

A) profit-enhanced advantage
B) competitive advantage
C) quality objectivity
D) strategic strength
E) tactical opportunity

Question 66

Zipcar is a car rental service found in many metropolitan areas.It targets people who take mass transit or carpool to work but who occasionally need a car to run errands,visit the doctor,or check on a sick child.Zipcar is one of a few companies currently providing cars that can be rented by the hour.Zipcar has created a(n)_____ advantage.

A) reengineering
B) experience curve
C) service differentiation competitive
D) alternative market
E) sustainable competitive

Question 67

Arizona Tea is marketed by Vultaggio & Sons.Vultaggio & Sons took a basic drink and put it into unusual bottles with elaborate designs.The wide-mouthed,long-necked bottles are now considered to be trendsetters in the new age beverage industry,and customers often buy the tea just for the bottle.The success of Arizona Tea is based on:

A) supply-demand curves
B) reengineering
C) a product differentiation competitive advantage
D) a cost competitive advantage
E) a heterogeneous marketing strategy

Question 68

Which of the following is NOT a type of competitive advantage?

A) management structure
B) cost
C) product/service differentiation
D) niche strategies
E) all of these choices are types of competitive advantages

Question 69

Which of the following is a strategic alternative?

A) vertical integration
B) product penetration
C) divestment
D) horizontal integration
E) market penetration

Question 70

As a customer entered the Hornady store,which sells muzzle loading rifles,a salesperson approached her and said,"Hornady lead round balls are the musket balls you ought to buy.They are the most uniform in size and shape,and they are made of pure lead.Our shot is used by the Muzzle Loading World Champion." The salesperson was describing Hornady's:

A) competitive advantage
B) strategic strength
C) tactical opportunity
D) opportunity mission
E) quality objective

Question 71

Fujisawa is Japan's seventh-largest pharmaceutical company.It sells drugs for organ transplant patients to increase the probability the new organ will operate efficiently and not be rejected.Currently,the only products Fujisawa makes are these organ transplant drugs,which it sells worldwide.Its patents protect it from competitors.Fujisawa has a:

A) brand name advantage
B) niche competitive advantage
C) cost competitive advantage
D) marketing competitive advantage
E) complete competitive advantage

Question 72

_____ show costs declining at a predictable rate as experience with a product increases.

A) Liquidity growth curves
B) EOQ graphs
C) Breakeven analyses
D) Experience curves
E) Supply/demand curves

Question 73

WalMart realizes a _____ using its relationships with suppliers to give customers low prices and good customer service.

A) brand name strategy
B) niche competitive advantage
C) cost competitive advantage
D) marketing competitive advantage
E) synergistic competitive advantage

Question 74

Jiffy Mixes do not do any type of traditional advertising or use fancy packaging in marketing their products.They store their own wheat and make their own flour and their little blue boxes,too.Jiffy is an example of a low cost strategy based on:

A) efficient labor
B) no-frills goods and services
C) government subsidies
D) product design
E) reengineering

Question 75

Aldi is a no-frills grocery chain.It sells grocery staples right out of crates and boxes with emphasis on low-priced,private-label brands.Aldi stores are typically about one-third the size of the traditional supermarket.By controlling expenses,Aldi enables its customers to save 30 to 50 percent compared to Kroger customers.The chain targets bargain hunters who are willing to rent a cart and bag their own groceries.Aldi has a(n)

A) market-homogeneous focus
B) cost competitive advantage
C) product aggregation strategy
D) revenue-based competitive advantage
E) profit-enhanced advantage

Question 76

Land O'Lakes makes a light butter with Canola oil that has sixty percent less cholesterol and fifty percent less fat and calories than butter.This marketing gives the product a _____.

A) strategic edge
B) competitive advantage
C) tactical strength
D) marketing mix
E) mission statement

Question 77

The set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition is known as a(n):

A) environmental advantage
B) experience curve
C) competitive advantage
D) market segment
E) strategic business unit

Question 78

Patents on prescription medications give pharmaceutical companies that own the patents a(n)_____ for 17 years until the patent expires.

A) targeted market position
B) sustainable competitive advantage
C) strategic focus
D) situational strength
E) opportunistic privilege

Question 79

Everyone knows the brand name Kleenex.Kleenex is what many consumers think of when they think of tissues.This widely recognized brand name is a source of:

A) a product differentiation competitive advantage
B) a cost advantage
C) market augmentation
D) a niche competitive advantage
E) none of these things

Question 80

All of the following are sources of a cost competitive advantage EXCEPT:

A) reengineering
B) experience curves
C) break-even analyses
D) efficient labor
E) production innovations