Deck 2: Strategic Planning for Competitive Advantage

Question 1

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

A) a reactive focus
B) marketing myopia
C) a market barrier entry
D) unempowerment

Answer 1

B

Question 2

What is the process of anticipating events and determining strategies to achieve organizational objectives?

A) portfolio evaluation
B) forecasting
C) planning
D) implementation

Answer 2

C

Question 3

General Electric has a security division that builds equipment for screening passenger luggage checked in at airports.This division comprises InVision Technologies,which manufactures CT scanners,and Ion Track,which measures luggage for trace element drugs and explosives.What is GE's security division an example of?

A) a strategic business unit
B) an organizational level
C) a business sales unit
D) a secure business unit

Answer 3

A

Question 4

In its stockholders' report,PepsiCo.states "...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 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 ..." Which of the following describes this statement?

A) a mission statement
B) a market segmentation strategy
C) a statement of economic potential
D) a marketing mix strategy

Question 5

What results when an organization creates a marketing mission that is too broad?

A) sustainable competitive advantage
B) directional marketing
C) marketing synergy
D) marketing myopia

Question 6

What does the acronym SBU refer to?

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

Question 7

According to the text,which of the following statements about a marketing plan is true?

A) The marketing plan should be viewed as a series of sequential steps.
B) A marketing plan is created so an organization can share its marketing objectives.
C) Marketing plans usually exist as oral traditions.
D) All marketing plans have exactly the same content.

Question 8

Managers at Bolsum Aerospace Company recently attended several special meetings where issues such as the creation of marketing objectives,a situation analysis,a target market strategy,and modifying components of the marketing mix were discussed.What is Bolsum Aerospace engaging in?

A) a financial analysis
B) the development of a marketing plan
C) re-engineering
D) strategic contingency planning

Question 9

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

A) functional planning
B) tactical management
C) environmental scanning
D) strategic planning

Question 10

What do strategic plans require?

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

Question 11

A popular technique for managing a large organization with different technologies and markets is to divide it into which of the following?

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

Question 12

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

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

Question 13

Compaq Computer's decision to charge customers for phone technical support to reduce the high cost of phone support and encourage customers to read documentation was a failure because consumers like the human touch.Customer rebellion forced Compaq to rethink this policy.As a result,Compaq decided to focus its resources on reaching the inexpensive home computer market segment through enhanced customer service.What is Compaq engaging in?

A) control and evaluation
B) the search for a differential advantage
C) strategic planning
D) alternative selection

Question 14

What should the focus of an organization's mission statement be on?

A) the market it wishes to serve
B) its social responsibilities
C) the products it wishes to sell
D) the desires of top management

Question 15

Which of the following is one of the elements of the marketing plan?

A) a business values statement
B) a five-year marketing strategy
C) a situation analysis
D) an advertising cost analysis

Question 16

One of the divisions of Procter & Gamble (P&G)manufactures and markets health and beauty aids.It handles products such Olay lotions and Old Spice fragrances.This part of the business has its own accounting,engineering,manufacturing,and marketing departments,separate from the rest of the organization.This division also has its own mission statement,target markets,and planning committees.What is this segment of P&G called?

A) a product market niche
B) a strategic alliance
C) a diversified division
D) a strategic business unit

Question 17

What does an SBU do?

A) has strategic planning performed back at corporate headquarters
B) competes with the same companies as the other SBUs in the family
C) usually benefits from the combined corporate raw materials purchases
D) controls its business independently of other SBUs in the organization

Question 18

By defining its business as "making movies" instead of "entertainment," what would a Hollywood movie studio have experienced?

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

Question 19

Railroads often offer their customers a trucking service for local delivery or trailers for piggybacking loads to their final destination.Which of the following statements justifies the addition of these services to the railroads' strategic plans?

A) Owning trucks is probably cheaper and easier than using a local carrier.
B) Their mission statements reflect their belief that they are transportation companies,not just railroads.
C) New business units are needed to continue growth.
D) Diversification is needed to survive.

Question 20

Marketing plans should be written to do which of the following?

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

Question 21

Which of the following could the manufacturers of video games for Xbox and PlayStation2 do through the use of environmental scanning?

A) learn why they needed to use a team management structure
B) periodically divest themselves of low-margin products
C) determine why the market for video games is slowing
D) benefit from experience curves

Question 22

Which of the following is a statement of what is to be accomplished through marketing activities?

A) a marketing objective
B) a mission statement
C) a business plan
D) a marketing criteria

Question 23

Baths From the Past is a small company that sells reproduction sinks,bathtubs,toilets,and faucets.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.What is Baths From the Past conducting?

A) a SWOT analysis
B) a market differentiation scan
C) a marketing audit
D) an environmental scan

Question 24

Through re-engineering,Bayer hopes to increase its profit margins,improve inventory turnover,and make itself more attractive to investors.Which of the following advantages is Bayer planning on creating by restructuring and selling off SBUs that do not complement its primary product lines?

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

Question 25

What would Revlon use to identify the fact that its brand names (Revlon,Almay,and Flex)had developed a poor image with both its customers and its retailers?

A) strategic analysis
B) environmental scanning
C) environmental control
D) marketing control

Question 26

Which of the following show costs declining at a predictable rate as experience with a product increases?

A) liquidity growth curves
B) supply/demand curves
C) breakeven analyses
D) experience curves

Question 27

Which of the following is a formal study conducted by an organization to assess its current status and capabilities and its future expectations?

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

Question 28

Which of the following is a source of a cost competitive advantage?

A) production reinvention
B) experience curves
C) inefficient labour
D) breakeven analyses

Question 29

A Canadian drink company conducting a SWOT analysis of market potential in India should be aware that which of the following are potential threats?

A) a high gross national profit
B) government openness to foreign businesses
C) religious differences that could lead to terrorist acts
D) a high demand for Canadian-made products

Question 30

There are many different kinds of cheese.According to its ads,only Jarlsberg Lite has 50 percent less fat,60 percent less cholesterol,and 100 percent of the taste of other kinds of cheese.What does this advertising statement describe?

A) Jarlsberg Lite's mission statement
B) Jarlsberg Lite's tactical strength
C) Jarlsberg Lite's competitive advantage
D) Jarlsberg Lite's strategic edge

Question 31

The SWOT acronym refers to a firm's analysis of which of the following?

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

Question 32

Which of the following companies has a competitive advantage?

A) Netcentives is trying to acquire the patent on a software that allows merchants to distribute loyalty points on-line.
B) Mildred's Café makes the world's best pecan pie according to one survey.
C) DeBeers diamonds used to control 90 percent of the world's diamond mines.
D) World Wrestling Entertainment (formerly the World Wrestling Federation)holds the trademark on the names of the wrestlers who participate in the company's wrestling matches.

Question 33

All the following are environmental forces a B.C.fruit grower with both orchards and a packaging/shipping facility might consider when making marketing decisions.What factor is LEAST likely to impact its marketing decisions?

A) changes in provincial laws concerning pollution control,waste disposal,and use of pesticides
B) inflation and interest rates
C) the number of employees of a Florida state fruit grower
D) the increase in foreign shipments to Canada of a similar product

Question 34

Lori Dyer works for Star Creek,an Australian wine-producing company.She has been asked to submit recommendations for marketing objectives for the upcoming strategic planning period.Which of the following marketing objectives would be most appropriate for the company?

A) Star Creek wants to be recognized as an international winery.
B) Star Creek wants to be number one in the marketplace for all Australian wines within one year.
C) Star Creek wants 30 percent of the market for Australian wines within 24 months of the launching of its new advertising campaign.This effort will be supported by a $20 million commitment from the company's owner and president.
D) Star Creek seeks to sell more bottles of wine than its competitors during the next strategic planning period.

Question 35

For marketing objectives to be realized,which of the following criteria must they meet?

A) be extremely challenging
B) be attainable with a short time frame
C) be set within a one-year time frame
D) be consistent with organization objectives

Question 36

Which of the following is an appropriate use for carefully specified marketing objectives?

A) as a way to force executives to develop their marketing skills
B) as a method for developing standards to gauge performance
C) as a motivational tool for those charged with achieving the financial objectives
D) as a method to appeal to all market segments

Question 37

Hustler Turf Equipment is a Saskatchewan-based company that makes landscaping equipment.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.What is Hustler Turf Equipment conducting?

A) a competitive advantage search
B) a situation analysis
C) a trend analysis
D) a market audit

Question 38

What is the collection and interpretation of information about forces,events,and relationships that may affect the organization?

A) environmental scanning
B) an internal audit
C) opportunity analysis
D) stakeholder analysis

Question 39

After management agrees on a mission statement,it must set objectives.Which of the following is a characteristic of a good objective?

A) It is realistic.
B) It is unmeasurable.
C) It is independent.
D) It is profitable.

Question 40

Tracey Read is designing a series of marketing activities to help her new catering company achieve its growth objectives in a highly competitive industry.What is Tracey engaged in?

A) strategic activation
B) evaluation
C) resource commitment
D) marketing planning

Question 41

Knorr,manufacturer of soup,dip,and gravy mixes,printed on-package recipes,gave out coupons to existing customers,and created a recipe booklet that could be ordered with three UPC codes from three different Knorr products.All of these activities would be representative of what type of strategy?

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

Question 42

American Express offers customers a Cobaltcard,a pre-loaded credit card,to 13- to 22-year-olds looking to make on-line purchases.While American Express had previously supplied credit cards to adults,this younger group was a market that was not being served.The Cobaltcard program is an example of which type of strategy?

A) market penetration
B) market development
C) product development
D) product penetration

Question 43

Which of the following is a type of strategic alternative that matches products and markets?

A) vertical integration
B) market redevelopment
C) product development
D) international diversification

Question 44

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

A) a cost advantage
B) market augmentation
C) a niche competitive advantage
D) a product differentiation competitive advantage

Question 45

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.What does Technol Medical products have?

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

Question 46

What is a strategy of increasing market share for present products in existing markets?

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

Question 47

The television network HBO produced the drama The Sopranos about a New Jersey mob family.It also published The Sopranos Family Cookbook: As Compiled by Artie Bucco,a collection of southern Italian-style recipes.Bucco is the name of a fictional restaurateur in the show.The creation of the cookbook to appeal to fans of the show is an example of what type of strategy?

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

Question 48

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 trend-setters in the new age beverage industry,and customers often buy the tea just for the bottle.What is the success of Arizona Tea based on?

A) re-engineering
B) a heterogeneous marketing strategy
C) a product differentiation competitive advantage
D) supply-demand curves

Question 49

Bentley automobiles are extremely expensive and are designed to appeal to consumers who equate value and quality with price.What type of competitive advantage has the manufacturer of Bentley automobiles created?

A) value enhanced
B) mass marketing
C) niche
D) social class oriented

Question 50

The company that manufactures Molson beer simultaneously launched Arctic brand in Ontario and Tornade brand in Quebec with the intention of gaining a share of the rapidly expanding alcoholic lemonade segment of the beverage industry.The separate launch strategies for the products are due to different market conditions in the two Canadian provinces.What type of strategy did Molson use to reach existing markets with its new product?

A) product development
B) market development
C) market penetration
D) product penetration

Question 51

Procter & Gamble has a website,www.pg.com,that is designed to help customers with product questions.While at the website,readers can request free samples of Olay Radiance,Pert Plus,and Folgers Latte,all new P&G products.The site also offers "More Than a Card," a feature that allows customers to buy an assortment hamper of new P&G products for less than $25.This is an example of how a company can implement which of the following strategies?

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

Question 52

In the following examples,when does market penetration occur?

A) when a Mexican distillery offers rebates to its current customers
B) when a hosiery manufacturer begins manufacturing wigs
C) when a Canadian-based company begins to sell its products in South America
D) when a supermarket chains adds another brand of ice cream to its inventory

Question 53

To market its ice cream to Chinese consumers,Unilever entered into a joint venture with Sumstar,a state-owned Chinese investment company.Unilever provided the product know-how,and Sumstar helped Unilever gain all the approvals needed from a complex Chinese bureaucracy.What type of strategy did Unilever use to reach the Chinese market?

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

Question 54

Anbac Financial Group,Inc.is the second-largest insurer of municipal bonds in the world.Anbac is expanding its insurance services from governmental accounts to include private developers of sports stadiums and similar large multi-use facilities.According to Ansoff's strategic opportunity matrix,what type of strategy would Anbac be implementing?

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

Question 55

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

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

Question 56

In order to expand its sales into the U.S.market,BRL,an Australian-based winemaker,agreed to a merger with a U.S.-based wine distribution company.According to Ansoff's strategic opportunity matrix,what type of strategy would BRL be implementing?

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

Question 57

What strategy attracts new customers to existing products?

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

Question 58

Yuengling is the oldest brewery in the United States.It was founded in 1827 in a time when small breweries dotted the nation.It has survived by severely limiting sales of the beer and creating a mystique about the brand.In areas where the beer is sold,its brand name is used the same way Kleenex is used by many to represent all types of tissues.Although its competitors all wanted to expand their markets.Yuengling's strategy was "To do nothing." For over 170 years,what has this strategy given the brewery?

A) a brand name strategy
B) a sustainable competitive advantage
C) a niche competitive advantage
D) a marketing competitive advantage

Question 59

Until the patent expires,what do patents on allergy relief medications such Allegra and Claritin give the pharmaceutical companies that own the patents?

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

Question 60

Research has shown that people below the age of 15 prefer using other colours than the familiar red ketchup.To capture this market,Heinz markets blue-,purple- and green-coloured ketchups.The ketchups have an exotic look,which Heinz hopes will appeal to this market.It still tastes like the red variety.Since this is not really a new product,just an attempt to reach a new target market,what type of strategy does it exemplify?

A) product development
B) product expansion
C) market development
D) market penetration

Question 61

Brickheads Ltd. ,located in Newmarket,Ontario,is the leading building materials manufacturer specializing in the manufacture of bricks for housing in the greater Toronto market.Tracey Dyer,Brickheads' Vice President Marketing,remarked to a board meeting that "Brickheads wished that it had an operation in lower mainland BC to capitalize on the housing boom currently being experienced there.But the overall profit picture here for us is excellent despite a slow and steady market." Brickheads would be classified by the BCG model as which of the following?

A) a star
B) a cash cow
C) a problem child
D) a dog

Question 62

In 1969,Alberto-Culver in Canada,a hair care products company,entered the food product industry and introduced Sugar Twin,currently the best-selling sugar substitute in the Canadian marketplace.This product introduction was an example of which type of growth strategy?

A) diversification
B) integrative
C) market penetration
D) market development

Question 63

What describes and estimates the size and sales potential of market segments of interest to the firm,and assesses key competitors in these market segments?

A) market opportunity analysis
B) environmental scan
C) marketing mix audit
D) target market strategy

Question 64

CentralPulse is Europe's largest manufacturer of hip and knee replacement joints.Which of the company's strategies would identify the surgeons and hospitals as two market segments on which CentralPulse will focus its marketing efforts?

A) strategic business unit
B) marketing sample
C) sales unit
D) target market

Question 65

Hallmark was inspired by the popularity of Jan Karon's best-selling novels about Mitford,a fictional town in the mountains of North Carolina,to develop a new line of products for Hallmark Gold Crown Stores.Hallmark created hundreds of Mitford-inspired products that authentically bring "the little town with the big heart" into tangible reality.The products include greeting cards,partyware and gift wrap,mugs,and puzzles for Hallmark's existing customers.What type of strategy did Hallmark use?

A) market development
B) product development
C) product penetration
D) market penetration

Question 66

Which strategy increases sales by introducing new products into new markets?

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

Question 67

Clay Market began as a retailer of terra cotta pots and garden figures imported from Turkey and Mexico.It has since added Turkish rugs and fabrics,leather-trimmed purses,and a line of women's clothes for its customers.This activity is indicative of which type of strategy?

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

Question 68

Bee-Clean Industries is a start-up company specializing in office building janitorial services in Victoria.Bee-Clean has experienced rapid growth of clients and has been rapidly hiring new employees to service this new business.As most employees are new to their tasks,their productivity has been below industry standard.As a result,the company's profit picture has not been pretty.According to the BCG,what would Bee-Clean be classified as?

A) a cash cow
B) a question mark
C) a star
D) a dog

Question 69

Juniper Group,which operates film distribution,health care,and Internet businesses,purchased shoemaker Tags Golf (Tags makes Bobby Jones-brand golf shoes)to create its sports division.What type of strategy did Juniper Group use?

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

Question 70

Vendarama,a specialty manufacturer of DVD and CD vending machines located in Hamilton,Ontario,has experienced meteoric growth over the past couple of years.Demand for its innovative and unique vending machines has been strong in major urban areas of the country and internationally.Vendarama has approached TJ Associates for a business loan to assist with expansion.According to the BCG model,how would TJ view Vendarama?

A) as a dog
B) as a star
C) as a problem child
D) as a cash cow

Question 71

Which strategy creates new products for present markets?

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

Question 72

Shortly after the start of the new century,Wrigley,the largest chewing gum manufacturer in the world,bid $12 billion for Hershey chocolate.Wrigley was unable to acquire Hershey,but its acquisition attempt would have expanded Wrigley's product lines to include many forms of baking and eating chocolate.Since Wrigley did not produce any chocolate at the time of the takeover bid,this acquisition would be an example of which of the following?

A) segment development
B) diversification
C) target marketing
D) divestment

Question 73

Fit,a health and fitness magazine,describes its readers as being female,18 to 25 years of age,single,high school graduates,and earners of above-average income.What would have identified this market segment?

A) the magazine's target market strategy
B) the magazine's market development strategy
C) the magazine's environmental audit
D) the magazine's statement of purpose

Question 74

Due to recent hurricanes,orange growers in Florida have lost millions of dollars.As a result,some growers have decided to bulldoze their orange groves and put in freshwater lakes for raising shrimp,a popular product that is more weather-resistant.What type of strategy are former orange growers who are now raising shrimp pursuing?

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

Question 75

Wacker Ltd.a large profitable manufacturer of mouse pads located in Moose Jaw,Saskatchewan,has been the sole supplier of mouse pads for 10 large corporations in the United States.However,recent developments have included several lost contracts for business in the United States and the entrance of more large Asian specialty manufacturers specializing in producing computer peripherals and supplies.Looking at Wacker's strategic position from a potential investor's position,and according to the BCG,what is Wacker?

A) a problem child
B) a dog
C) a star
D) a cash cow

Question 76

Which of the following terms would be used to describe Hispanic males between the ages of 12 and 19?

A) exchange mixers
B) a diversified market
C) a market segment
D) a sustainable market

Question 77

What is the unique blend of product,distribution,promotion,and pricing strategies designed to produce mutually satisfying exchanges with a target market?

A) marketing mix
B) product line
C) product mix
D) market portfolio

Question 78

ConAgra Foods,Inc.has decided to sell all of its meat-processing plants and get out of its meat-processing business in order to raise the company's net profits.Which of the following statements describes how the sale of the processing plants will affect ConAgra's marketing mix?

A) It will have no effect on ConAgra's marketing mix.
B) It will not affect the promotion or distribution elements of the ConAgra marketing mix.
C) It will affect all of ConAgra's marketing mix elements,either directly or indirectly.
D) It will affect only the product element of ConAgra's marketing mix.

Question 79

Tootsie Roll Industries has been in the candy business for over 100 years.Each year it produces 37 million Tootsie Roll candies and 16 million Tootsie Pop candies.During its 100+ years of operation,it has bought out 17 different candy brands.What type of strategy was it implementing?

A) market development
B) product development
C) diversification
D) integrative growth

Question 80

Blockbuster rents and sells DVDs.When the retailer entered into the music retailing business,what type of strategy did it implement?

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