Deck 18: Creating Competitive Advantage

Question 1

From an industry point of view, Universal Pictures film studio might see its competition as ________.

A) West End theatre
B) Columbia Pictures
C) Tomorrowland
D) Summerfest
E) HarperCollins

Answer 1

B

Question 2

Companies can identify competitors from one of two points of view: ________.

A) manufacturing or selling
B) engineering or producing
C) consumer or business
D) industry or market
E) unique or similar

Answer 2

D

Question 3

A competitor analysis requires the assessment of all of the following EXCEPT the competitors' ________.

A) objectives
B) organizational hierarchy
C) strategies
D) strengths and weaknesses
E) reaction patterns

Answer 3

B

Question 4

Fosters and Mason House, two major coffee brands, competed neck and neck based on their product attributes and price promotions. They were soon blindsided by the arrival of Starcoffeez, which focused more on the coffee experience rather than the coffee. This resulted in major losses for the two companies. This is an example of ________.

A) self-competition
B) competitor myopia
C) competitor backlinking
D) marketing myopia
E) perfect competition

Question 5

________ involves first identifying and assessing competitors and then selecting which competitors to attack or avoid.

A) Competitor analysis
B) Self-competition
C) Blue ocean strategy
D) Quantitative analysis
E) Perfect competition

Question 6

Each competitor has a mix of objectives. The company wants to know the relative importance that a competitor places on all of the following EXCEPT ________.

A) company history
B) current profitability
C) market share growth
D) cash flow
E) technological leadership

Question 7

The goal of performing a competitor analysis is to ________.

A) learn more about the competitors' sales structures
B) find flaws in the competitors' manufacturing processes
C) copy the best features that the competitors offer
D) find areas of potential competitive advantage and disadvantage
E) develop products in markets that the competitors are not in

Question 8

If a company identifies its competitors from an industry point of view, it must understand ________ if it hopes to be an effective player in that industry.

A) the trends in the industry
B) the primary customers
C) the impact of technological changes
D) the potential customers
E) the competitive patterns

Question 9

To plan effective marketing strategies, a company needs to find out all it can about its competitors. It must constantly compare its marketing strategies, products, prices, channels, and promotions with those of close competitors. This is an example of ________.

A) blue ocean strategy
B) competitor analysis
C) organizational evaluation
D) perfect competition
E) quantitative analysis

Question 10

The first step in initiating competitive marketing strategies is to ________.

A) balance customer and competitor orientations
B) design broad competitive marketing strategies
C) assess long-term organizational objectives
D) conduct competitor analysis
E) conduct transaction analysis

Question 11

Companies can identify competitors from a(n) ________ point of view by defining competitors as companies that are trying to satisfy the same customer need or build relationships with the same customer group.

A) customer
B) blue ocean
C) market
D) myopic
E) industry

Question 12

Strategies that strongly position a company against competitors and that give the company the best possible strategic advantage are ________ strategies.

A) competitor analysis
B) customer relationship
C) competitive marketing
D) competitive relationship
E) customer identification

Question 13

From a market point of view, Universal Pictures film studio might see its competition as ________.

A) Paramount Pictures
B) Warner Bros. Pictures
C) Walt Disney Pictures
D) 20th Century Fox
E) Broadway

Question 14

A company is guilty of ________ if the company forgets latent competitors and only focuses on current competitors.

A) perfect competition
B) self-competition
C) Cournot competition
D) competitor backlinking
E) competitor myopia

Question 15

Kodak's film business didn't lose out to direct competitor Fujifilm; it lost out to Sony, Canon, and other digital camera makers, along with a host of digital image developers and online image sharing services. This is an example of ________.

A) a blue ocean strategy
B) competitor backlinking
C) self-competition
D) competitor myopia
E) marketing myopia

Question 16

Gaining ________ requires delivering more value and satisfaction to target consumers than competitors do.

A) competitive advantage
B) first-mover advantage
C) economies of scale
D) comparative advantage
E) differentiation

Question 17

What is the LEAST relevant question to ask when assessing a firm's main competitor?

A) What are the competitor's objectives?
B) What is the competitor's strategy?
C) What are the competitor's strengths?
D) What are the competitor's locations?
E) What are the competitor's weaknesses?

Question 18

Companies can identify their competitors from both ________ points of view.

A) industry and market
B) product and customer
C) customer and location
D) location and product
E) product and strategy

Question 19

From a(n) ________ point of view, Pepsi might see its competition as Coca-Cola, Dr Pepper, 7UP, and the makers of other soft drink brands. From a(n) ________ point of view, however, the customer really wants "thirst quenching."

A) market; industry
B) market; consumer
C) industry; competitive
D) industry; market
E) company's; consumer's

Question 20

Nintendo, producer of the Wii video game console, might define its competitors as other makers of physically interactive video games. But from a(n) ________ point of view, it would include all firms making physically interactive recreational products.

A) industry
B) market
C) segment
D) niche
E) interdependent

Question 21

A company's close competitors are ________.

A) considered "bad" competitors
B) a serious threat and hence, must be attacked rather than ignored
C) those that most resemble the company's operations
D) typically ignored as they seldom pose any threat
E) the sole focus of successful companies

Question 22

If a company's offer delivers greater value by exceeding the competitor's offer on important attributes, the company can charge a higher price and ________, or it can charge the same price and ________.

A) earn lower profits; gain higher profits
B) earn higher profits; lose profits
C) earn higher profits; gain more market share
D) lose profits; gain more market share
E) lose profits; gain higher profits

Question 23

Marketers need an in-depth understanding of ________ if they want to anticipate how that competitor will act.

A) the industry
B) a competitor's mentality
C) a competitor's strengths and weaknesses
D) a competitor's business model
E) the market

Question 24

Which of the following are examples of close competitors?

A) Applebee's and Subway
B) Taco Bell and T.G.I. Friday's
C) Pizza Hut and Burger King
D) McDonald's and Taco Bell
E) McDonald's and Burger King

Question 25

A firm should compete with ________ competitors in order to sharpen its abilities. Succeeding against these competitors often provides greater returns.

A) strong
B) international
C) weak
D) distant
E) smaller

Question 26

In the context of identifying competitors' strategies, the more that one firm's strategy resembles another firm's strategy, the more likely the two firms are to ________.

A) merge
B) compete
C) globalize
D) form a partnership
E) become market leaders

Question 27

An industry often contains "good" and "bad" competitors. Good competitors ________.

A) break the rules of fair competition
B) ensure minimum competition between firms
C) play by the rules of the industry
D) typically dominate the market
E) share their marketing strategies with other firms

Question 28

An analysis conducted to determine what benefits target customers value and how they rate the relative value of various competitors' offers is known as ________.

A) customer lifetime value
B) customer value analysis
C) quantitative analysis
D) brand value proposition
E) benchmarking

Question 29

What is most likely a strategic benefit of the existence of competitors?

A) Competitors seldom lead to product differentiation.
B) Competitors help legitimize new technologies.
C) Competitors exclusively serve more-attractive segments.
D) Competitors fracture the target market.
E) Competitors decrease the total demand.

Question 30

In conducting ________, the company first identifies the major attributes that customers value and the importance customers place on these attributes. Next, it assesses its performance against competitors on those valued attributes.

A) a customer value analysis
B) benchmarking
C) entrepreneurial marketing
D) intrepreneurial marketing
E) a customer lifetime value estimate

Question 31

Companies need to know each competitor's product quality, features, and mix; customer services; pricing policy; distribution coverage; sales force strategy; and advertising and sales promotion programs. These are all the dimensions that identify ________ groups within the industry.

A) target
B) focus
C) control
D) strategic
E) experimental

Question 32

A market research firm conducts a survey of soft-drink consumers to assess Pepsi's and Coke's strengths and weaknesses in attributes valued by both company's target customers. The market research firm is using a ________.

A) customer lifetime value estimation
B) global marketing strategy
C) competitive marketing strategy
D) customer value analysis
E) blue ocean strategy

Question 33

Companies use secondary data, personal experience, and word of mouth to ________.

A) identify competitors' target customers and strategies
B) identify competitors' target locations and market share
C) learn about their competitors' strengths and weaknesses
D) select competitors to attack or avoid
E) estimate competitors' sales projections

Question 34

Country Kitchen and Perkins are both a chain of family restaurants featuring diner-like menus with reasonably priced items. These companies are in the same ________.

A) focus group
B) control group
C) strategic group
D) target group
E) experimental group

Question 35

Benchmarking has become a powerful tool for increasing a company's ________.

A) product mix
B) mass appeal
C) employee training services
D) distribution channels
E) competitiveness

Question 36

A company's objectives indicate its satisfaction with its current situation and ________.

A) its strength with its current management
B) in what areas it intends to develop further
C) how strong it is financially
D) how it might react to different competitive actions
E) its areas of concern, if any

Question 37

________ is the process of comparing the company's products and processes to those of competitors or leading firms in other industries to find ways to improve quality and performance.

A) Segmenting
B) Positioning
C) Sales promotion
D) Benchmarking
E) Publicity

Question 38

In the audio equipment industry, Philips and Sony belong to the same ________.

A) target group
B) strategic group
C) experimental group
D) control group
E) focus group

Question 39

Most companies will compete with ________ rather than ________.

A) distant competitors; close competitors
B) close competitors; distant competitors
C) benchmarkers; distant competitors
D) market challengers; market followers
E) market challengers; market nichers

Question 40

A company that pursues ________ will react much more strongly to a competitor's cost reducing manufacturing breakthrough than to the same competitor's advertising increase.

A) product differentiation
B) low-cost leadership
C) customer intimacy
D) a middle-of-the-roaders strategy
E) product leadership

Question 41

A competitive analysis involves first identifying and assessing competitors and then selecting which competitors to attack or avoid.

Question 42

The competitive intelligence system does all of the following EXCEPT ________.

A) sends relevant information to decision makers and responds to inquiries from managers
B) takes action against the competitors once the data has been analyzed
C) collects information from the field and published data
D) checks the information for validity, interprets it, and organizes it
E) identifies vital types of competitive information needed and the best sources

Question 43

At the narrowest level, a company can define its competitors as other companies offering similar products and services to the same customers at similar prices.

Question 44

The competitive intelligence system continuously collects information from the field through ________.

A) government publications
B) online monitoring
C) speeches
D) online databases
E) market surveys

Question 45

Benchmarking involves comparing the firm's products and processes to those of the competitors to identify best practices to improve quality and performance.

Question 46

"Destroying" a close competitor can actually damage a company's market share in the long run.

Question 47

Customers see competitive advantages as customer advantages.

Question 48

Refer to the scenario below to answer the following question(s).
Essential-Beauty is a rapidly growing firm that manufactures women's makeup, perfumes, and nail-care products. The company has established itself as a high-end cosmetic product brand available at most national drug stores. In the past, almost all of the advertising for Essential-Beauty has been in women's fashion magazines.
The firm is now launching a new line of skin care products, ranging from facial cleansers to body lotion. These products are designed to be marketed to a broader audience, so the marketing team is exploring the effectiveness of different promotional mixes.
Essential-Beauty considers one of its most important competitors to be Look-Lovely, another marketer of high-end makeup and skin care products sold in drug stores. Based on this, it is most accurate to say that Look-Lovely and Essential-Beauty are both ________.

A) niche marketers
B) in the same strategic group
C) distant competitors
D) overall cost leaders
E) market followers

Question 49

Rather than competing head to head with established competitors, many companies seek out unoccupied positions in uncontested market spaces. They try to create products and services for which there are no direct competitors. This is called a ________.

A) horizontal integration approach
B) commercialization process
C) guerrilla marketing technique
D) blue ocean strategy
E) lean dynamics approach

Question 50

Continuous innovation is a weak response by a company trying to protect its market share.

Question 51

To plan effective marketing strategies, the company must ignore its competitors.

Question 52

Competitive exchanges such as comparison advertisements can provide useful information to consumers and advantages from brands. However, they also might reflect negatively on the entire industry.

Question 53

A group of firms in an industry following the same or a similar strategy in a given target market is known as a strategic group.

Question 54

Refer to the scenario below to answer the following question(s).
Essential-Beauty is a rapidly growing firm that manufactures women's makeup, perfumes, and nail-care products. The company has established itself as a high-end cosmetic product brand available at most national drug stores. In the past, almost all of the advertising for Essential-Beauty has been in women's fashion magazines.
The firm is now launching a new line of skin care products, ranging from facial cleansers to body lotion. These products are designed to be marketed to a broader audience, so the marketing team is exploring the effectiveness of different promotional mixes.
Essential-Beauty e-mailed a survey to a group of its most frequent, loyal customers. The survey asked what makeup and skin care characteristics were most important to them. The company's marketing staff then ranked the performance of Essential-Beauty products in each of these categories. Essentials was conducting a(n) ________.

A) customer lifetime value survey
B) entrepreneurial marketing strategy
C) intrepreneurial marketing strategy
D) customer value proposition
E) customer value analysis

Question 55

Tomorrow's leading companies will succeed by seeking out unoccupied positions in uncontested market spaces. Such strategic moves, termed ________, create powerful leaps in value for both the firm and its buyers, creating new demand for new products.

A) customer lifetime value
B) customer equity
C) value innovation
D) market segmentation
E) customer intimacy

Question 56

An example of a company exhibiting a blue ocean strategy is ________.

A) Amazon's online shopping convenience
B) a Starbucks opening in the same vicinity of an independent coffee house
C) Nike's brand image of the "swoosh"
D) Whirlpool's full line of medium-priced, energy-saving appliances
E) the first digital tablet iPad released by Apple

Question 57

Most competitors in the music download industry see Apple's iTunes Music Store as a ________ because it created a closed system with mass appeal.

A) good competitor
B) marginal competitor
C) weak competitor
D) bad competitor
E) distant competitor

Question 58

Which of the following is the first step taken in the competitive intelligence system?

A) collect published data and information from the field
B) check, interpret, and organize gathered information
C) identify the vital types of competitive information needed
D) respond to inquiries from managers about competitors
E) create a new brand image and marketing concept for the firm

Question 59

Most companies prefer to compete against strong competitors.

Question 60

Companies in competition within a strategic group do not compete with other strategic groups.

Question 61

A good competitor plays by its own rules at the expense of the industry as a whole.

Question 62

How can companies learn about their competitors' strengths and weaknesses?

Question 63

Describe a strategic group. Name a few companies that belong to the same strategic group, and discuss why they are in the same group.

Question 64

Discuss why a company really needs and benefits from competitors.

Question 65

Discuss the steps in analyzing competitors.

Question 66

An industry often contains "good" competitors and "bad" competitors. Define each term and discuss scenarios with both "good" and "bad" competitors. How might "good" competitors choose to react to "bad" competition?

Question 67

Discuss the need to understand competitors as well as customers through competitor analysis.

Question 68

Which of the following statements is true of the approaches to marketing strategy?

A) Intrepreneurial marketing applies to companies that sometimes lose their marketing creativity and passion that they had at the start.
B) As small companies achieve success, they inevitably move away from more-formulated marketing.
C) Within a company, a single strategy exclusively applies to all different businesses and products.
D) Formulated marketing seldom involves developing formal marketing strategies and adhering to them closely.
E) Formulated marketing encourages more marketing initiative and "intrepreneurship" at the local level.

Question 69

Discuss the functions and goals of a competitive intelligence system.

Question 70

In some markets, competitors live in relative harmony.

Question 71

Marketing managers need a deep understanding of a given competitor's mentality if they want to anticipate how the competitor will act or react. Discuss the different ways competitors act or react. Why do they do so? Use examples to support your thoughts.

Question 72

Discuss the different levels at which competitors can be identified.

Question 73

What is the purpose of benchmarking?

Question 74

The competitive intelligence system of a company supplies key information to relevant decision makers about the company's competitors.

Question 75

Explain how the United States Postal Service has "competitor myopia."

Question 76

The existence of competitors in a market may cause a decrease in total demand.

Question 77

Although competition is most intense within a strategic group, explain why there is also rivalry among groups. Give examples.

Question 78

Give examples of competitor objectives and discuss the importance of knowing a competitor's mix of objectives.

Question 79

Competitors may serve less-attractive segments or lead to more product differentiation.

Question 80

The goal of a "blue ocean strategy" is to make competition irrelevant.