Deck 43: Prestige Brands Inc-Transforming the Business

Question 1

Looking at its list of OTC healthcare products,Prestige Brands,did not improve its positioning in eye care products.

Answer 1

True

Question 2

Which of the following expenses does Prestige most likely not eliminate by its reliance on acquisition over new product development?

A) R&D
B) testmarketing
C) commercialization
D) business analysis
E) none of the above

Answer 2

D
Given that Prestige calculates what brands it buys before and after acquisition,it would engage in a process analogous to a business analysis,that is,an assessment of the demand,cost,sales,and profitability of an acquired product.

Question 3

Efferdent,PediaCare,and the other products Prestige picked up from its Blacksmith acquisition should be more correctly seen as __________ rather than __________.

A) product mixes/brands
B) product lines/product items
C) product item/product lines
D) product items/brands
E) product mixes/product lines

Answer 3

B
Each of these brands will include the various product items that are categorized under a product line.

Question 4

Venerable brands such as Luden's (cough drops originally formulated over a century ago)and Efferdent (virtually synonymous with denture adhesive since the days of early television)give Prestige what important attribute?

A) brand equity
B) a major position in both segments
C) two brand marks
D) household words
E) manufacturing brands to go with its private brands

Question 5

Given some redundancy in its product mix,Prestige is not immune from cannibalization.

Question 6

The third prong of Prestige's corporate strategy involves periodically reassessing which brands are the best for the company in the long term from a portfolio standpoint and then adjusting the portfolio accordingly.Peter Drucker gave this a name.What is it?

A) product demixing
B) product line attrition
C) organized abandonment
D) periodic audit
E) organized delisting

Question 7

The acquisition of Blacksmith is called a "transformational acquisition" for what reason?

A) It made Prestige an even larger niche marketer of minor brands.
B) It addressed stockholder concerns about a lack of focus.
C) It eliminated a competitor.
D) It provided more product line depth to a core business.
E) It evened out a sales pattern that had been dependent on the cough, cold, and flu season.

Question 8

One benefit that Prestige probably does not enjoy is an extreme economy of scale in its advertising.

Question 9

One aspect of expanding a portfolio through acquisition is a new product mix.Compoz and Momentum brands have a product depth of 1.What term best describes them?

A) unsought products
B) noncore brands
C) convenience products
D) product lines
E) all of the above

Question 10

The acquisition of Blacksmith left Prestige's depth in household brands unchanged.