Deck 4: Retail Market Strategy

Question 1

How would a locally owned fitness centre develop a sustainable competitive advantage over a chain like Gold's Gym?

A) Utilize a computerized database management system to monitor visitors and out of town guests
B) Advertise in health and fitness magazines
C) Develop relationships with members by offering unique work-out programs with assigned instructors recommending specific routines to suit their needs
D) Reduce membership fees
E) Offer more classes

Answer 1

C

Question 2

Although she considers many retailers when shopping for clothes, Rosa always buys suits in Reitmans because their selection and prices are second to none. Her affinity for Reitmans best demonstrates which of the following?

A) brand familiarity
B) good vendor relations
C) unique merchandise assortment
D) brand awareness
E) customer loyalty

Answer 2

E

Question 3

A retailer's format uses the to satisfy the needs of the target market.

A) sustainable competitive advantage
B) buying plan
C) retail mix
D) demographic information
E) positioning statement

Answer 3

C

Question 4

You are about to loan a friend $10,000 to start a candy store in a central business district. Where can you find information about how he plans to build a sustainable advantage?

A) In the retail market strategy
B) In the organizational chart
C) In the organizational mission statement
D) In the marketing objectives
E) In the situation audit

Question 5

Which of the following would not be an effective way for a jewellery store to develop a sustainable competitive advantage?

A) Carry unique merchandise
B) Develop an excellent relationship with the jewellery vendor
C) Sell gold watches at lower prices than anywhere else in town
D) Develop an efficient inventory system
E) Secure a good location

Question 6

Talbots is a catalogue and a specialty store retailer. Its target market is 35-to-55-year-old women. Sixty percent of its customers are college-educated with an average family income of $75,000. Talbots offers private brands, moderate to better-priced women's classic apparel, shoes, and accessories. Its stores are located in village locations and upscale regional malls. Synergies among the store, catalogue and website operations provide a competitive advantage over other retailers. This is a description of Talbots':

A) merchandise budget plan
B) organizational structure
C) mission statement
D) retail strategy
E) marketing objective

Question 7

Which of the following is an opportunity for a retailer to develop a sustainable competitive advantage?

A) Customer loyalty
B) Unique merchandise
C) Customer service
D) Distribution systems
E) All of these are opportunities for the retailer

Question 8

Which of the following is an area in which a retailer can develop a long-term competitive advantage?

A) vendor relations
B) carry national brands
C) advertising
D) loss prevention
E) visual merchandising

Question 9

The Knotty Question is a tie store chain that is found in many airport concourses. Its ________ is business travelers who have either forgotten to pack a tie or spilled something on their tie and need a replacement.

A) retail mix
B) retail format
C) target market
D) marketing objective
E) marketing mix

Question 10

Fastlane (Sports shoe company) has decided to expand and is experimenting with various growth strategies. It first decided to purchase some Burger King (fast food franchises) and Mobay (Jamaican restaurant) stores. This move was considered a failure and now Fastlane has decided to open more Fastlane stores and to keep them open longer than their competitors. Fastlane has:

A) Abandoned a retail format development strategy and adopted a diversification strategy
B) Abandoned a market penetration strategy and adopted a retail format development strategy
C) Abandoned a diversification strategy and adopted a market expansion strategy
D) Abandoned a diversification strategy and adopted a market penetration strategy
E) Abandoned a market expansion strategy and adopted a market penetration strategy

Question 11

A retail strategy is a statement that will identify which of the following?

A) the retail market
B) price points
C) the target market
D) output measures
E) the advertising campaign

Question 12

A dry cleaner can develop a sustainable competitive advantage by:

A) develop a patented chemical that removes wine stains without harming the fabric
B) developing a coupon offering with some of the local department stores
C) developing a customer database to offer special promotions
D) securing a good location
E) doing all of these

Question 13

Starbucks is a chain of gourmet cafes that cater to coffee drinkers. Many of their customers commute from the suburbs and many of the stores are in business districts to accommodate the commuters' needs. Starbucks sells their private brand of coffees and accompanies them with fresh baked goods. They have a synergy between their stores and their website which helps to maintain an advantage over competing local coffee shops.
This is a description of Starbuck's:

A) marketing objective
B) organizational structure
C) retail strategy
D) merchandise budget plan
E) mission statement

Question 14

Zany Brainy appeals to the over-30-years old parents who have children under the age of 10 and who have annual incomes of more than $50,000. These parents are the store's:

A) retail format
B) retail mix
C) target market
D) marketing mix
E) marketing objective

Question 15

Which of the following provides the direction that the retailer plans to take to deal effectively with environmental factors?

A) merchandise budget plan
B) retail strategy
C) organizational structure
D) mission statement
E) marketing objective

Question 16

Even though there are several garages in town, Kelly gets her oil changed only at Mr. Lube. This commitment to Mr. Lube illustrates:

A) customer loyalty
B) brand acceptance
C) good customer service
D) store awareness
E) none of these

Question 17

Fingerhut is best known as a catalogue retailer selling a variety of merchandise. Their reach is over 500 million homes with a target market of households with annual incomes between $15,000 and $35,000. Fingerhut offers unique payment plans to meet the needs of their customers and has a sophisticated database management technique that targets
Marketing activities and minimizes credit risks. This is an example of a:

A) marketing segmentation
B) merchandise assortment pan
C) mission statement
D) retail strategy
E) retail classification

Question 18

Why should a retailer be concerned with building a sustainable competitive advantage?

A) It could affect merchandise planning
B) It is the final step in developing the retail strategy
C) It could result in long-term profitability
D) They should not as other retailers would just duplicate the efforts
E) The competition's advantage will stimulate the retailer's market

Question 19

Which of the following is a group of consumers with similar needs and a group of retailers using a similar format to satisfy those consumers' needs?

A) target audience
B) retail mix
C) marketing format
D) target market
E) retail market

Question 20

A SWOT analysis is often conducted during which stage of the strategic retail planning process?

A) Establishing objectives
B) Situational audit
C) Retail segmentation process
D) Evaluating strategic alternatives
E) Definition of business mission

Question 21

Developing programs to motivate and coordinate employee efforts, providing incentives, fostering an organizational culture and managing diversity are functions of the:

A) general store manager
B) human resource manager
C) district manager
D) marketing manager
E) chief executive officer

Question 22

When Starbucks opened in Seattle, it allowed store density to promote the business. Sometimes, the storefronts occupied two corners of an intersection. Only when the Seattle market was saturated did Starbucks move into other markets. Starbucks understands the value of building a competitive advantage through securing:

A) positioning
B) customer loyalty
C) database warehouses
D) good locations
E) trained servers

Question 23

How can a small town quilting supply store compete against Walmart and still thrive?

A) The shop can extend its hours
B) The shop can offer classes on quilting.
C) The store can hire part time employees
D) The store can lower prices
E) all of these

Question 24

A department store can foster customer loyalty by:

A) accepting all major credit cards
B) having a sales-oriented mission statement
C) offering free gift wrap with a $50 purchase
D) positioning itself as a store that cares as much about its customers
E) using single sourcing

Question 25

Building store loyalty by targeting customers and better meeting their needs can:

A) attract new shoppers
B) annoy occasional shoppers
C) prohibit the variety of assortments in a category
D) improve customer satisfaction
E) inhibit customer growth

Question 26

Since Walmart has an efficient distribution and information system, it is able to offer ________ to its customers.

A) lower prices
B) better locations
C) better customer service
D) a greater depth of merchandise
E) complementary services and merchandise

Question 27

The parking lot of the Chevy Café contains four vintage restored Chevrolets from the 1950s and 1960s. The café building is painted the same colour blue as used on 1964 Chevrolets. The booths inside are made to look like car bench seats. The food served is limited to burgers, hotdogs, shakes, and fries. The café's image as a retro place to eat is an example of the implementation of a/an strategy.

A) positioning
B) detailing
C) retail perception
D) response-stimulus
E) imaging

Question 28

It is difficult for retailers to develop a sustainable competitive advantage just through merchandise because:

A) competitors can purchase and sell the same national brands
B) different regions of the country carry different merchandise
C) designers specify which retailers can sell their brands
D) vendors favour the larger retailers because they buy more volume
E) distribution centres are unreliable on shipping dates

Question 29

Mary wanted to purchase a vase as a wedding gift. Pier 1 Imports offers a better assortment and slightly lower prices, but she immediately went to her local gift shop instead and passed the Pier 1. This is an example of:

A) direct competition
B) customer loyalty
C) strategic controls
D) retail perception
E) a situation audit

Question 30

After Susan spent $500 at shopsonymusic.ca she was instantly a member of Sony Music's Most Valuable Customer (MVC) program. Members receive bonus reward dollars for future purchases. The MVC program is an example of a:

A) music club
B) warehouse club
C) customer service strategy
D) loyalty program
E) marketing strategy

Question 31

The Atlantic Inn is located on Cape Breton Island. It has a 100-year history of visitors and vacationers from all over the world. The Inn exudes luxury from the moment you walk to the moment you savour the fine cuisine in its restaurant. The rooms are decorated with furniture from the early 20th century. Visitors are served beverages on the porch as they rock in the chairs and watch the port. This model of luxury is part of The
Atlantic Inn's .

A) strategy
B) positioning
C) culture
D) perception
E) marketing program

Question 32

Customer loyalty programs are part of:

A) data warehouses
B) human resource management
C) the retail concept
D) customer relationship management
E) positioning

Question 33

Having efficient distribution and information systems is vital to retailers to sustain a competitive advantage because:

A) they are able to deliver merchandise at lower costs and apply the margin to lower prices or better services
B) the information flow between vendors and stores is seamless enabling rapid replenishment
C) they are able to get the merchandise to the customer quickly and efficiently
D) they are able to get the assortments to the customer they want
E) all of these

Question 34

Customers that shop at Books-A-Million find that it has a marvellous selection of books with a helpful and friendly staff. In addition, they can enjoy a peaceful place to read while sipping a cappuccino at the in-store coffee shop. Their perception of the store
Indicates its

A) positioning
B) retail feedback strategy.
C) perceptual retailing
D) imaging
E) visual merchandising

Question 35

By using the information provided from the data warehouse, a retailer can:

A) advertise to a more marketable demographic segment
B) offer more services like gift wrap, lower interest rate credit, and same-day delivery
C) determine whether moving to a new location would attract more business
D) tailor offerings to better meet the needs of their customers
E) easily gauge price points to meet the competitor's prices

Question 36

Positioning is the process of:

A) performing a situation audit
B) acquiring a lease for a retail store in a region
C) finding a retail location site
D) negotiating the percentage-of-sales payment to the mall owners
E) creating and supporting a clear and distinct image

Question 37

is the design and implementation of a retail mix to create an image of the retailer in the customer's mind relative to its competitors.

A) Positioning
B) Competitive feedback
C) Retail perception
D) Detailing
E) Imaging

Question 38

Good human resource management is important to retailers because:

A) employees manipulate the system when there is no training
B) employees who are motivated and feel a part of a culture are more likely to build customer loyalty
C) management does not have the time to develop training programs because of their other responsibilities
D) management is not trained in labour laws
E) the goal is to develop long-term relationships with employees

Question 39

Retailers foster customer loyalty by:

A) having a generalized organizational mission statement
B) trying to attain qualitative objectives rather than quantitative ones
C) providing superior customer service
D) having no one distinct image of their brand
E) using a mass advertising strategy

Question 40

Lisa loves to stop into Winners once a week. Winners purchases overruns or out-of-season merchandise from vendors and retailers then sells them in their stores for less. With each visit, she never knows what she will find, but she feels assured it will be
A bargain. Winners store is in Lisa's mind as a retailer with varied assortments
With reasonable prices.

A) perceived
B) solidified
C) positioned
D) visualized
E) sustained

Question 41

The best way for a retailer to develop a sustainable competitive advantage is to:

A) develop a good distribution system
B) concentrate on having the lowest prices in town
C) maintain good vendor relations
D) utilize multiple approaches to build as high a wall around its position as possible
E) concentrate on finding the best location

Question 42

Which of the following are examples of growth opportunities?

A) Market penetration
B) Retail format development
C) Market expansion
D) Diversification
E) All of these are examples of growth opportunities

Question 43

When given a choice between selling a national brand of makeup and a private-label brand, a mall-based specialty store retailer might choose to develop a private-label brand:

A) to increase its merchandising flexibility
B) to limit its store traffic to qualified buyers
C) to increase its sales expenses
D) to prevent its customers from comparison shopping
E) for all of these reasons

Question 44

After Bill and Beth purchased a leather couch from The Brick, the sales associate took them to see end tables, coffee tables and lounge chairs that complement their new couch. The sales associate engaged in:

A) intradepartmental selling
B) transfer purchasing
C) customer crossover
D) cross-selling
E) bait and switch

Question 45

When J. Crew moved its stores into other countries, it increased the company's international market share. J. Crew took advantage of a opportunity.

A) retail format development
B) market divestment
C) market penetration
D) diversification
E) market expansion

Question 46

means that sales associates in one department attempt to sell complementary merchandise from other departments to their customers.

A) Transfer purchasing
B) Intradepartmental selling
C) Customer crossover
D) Bait and switch
E) Cross-selling

Question 47

A successful private-label brand:

A) develops store loyalty
B) enhances store image
C) differentiates a store from its competitors
D) increases store traffic
E) does all of these

Question 48

When Disney opened mall-based specialty stores to sell the theme park merchandise, it was exercising

A) diversification
B) market penetration as its growth strategy.
C) retail format development
D) market divestment
E) market expansion

Question 49

Which type of retail growth strategy is most closely associated to cross-selling?

A) market depletion
B) diversification
C) retail format development
D) market penetration
E) market divestment

Question 50

Why would a retail chain like La Senza want to develop private-brand labels to be sold exclusively at its stores?

A) To gain publicity for the chain
B) To develop effective distribution strategies
C) To upgrade its reputation as a lingerie boutique
D) To take advantage of its mall locations
E) To foster customer loyalty

Question 51

After Courtney purchased a swimsuit for her cruise, the sales associate took her to the cosmetics department to sell her a water-resistant sunscreen that would allow her to have fun showing off her suit without having to worry about sunburn. This is an example of:

A) transfer purchasing
B) intradepartmental selling
C) cross-selling
D) bait and switch
E) customer crossover

Question 52

Which of the following is an example of a private-label brand?

A) Kodak film
B) President's Choice coffee
C) Sony DVD player
D) Levi's jeans
E) Kellogg's cornflakes

Question 53

Kenmore refrigerators are an example of:

A) no-name brands
B) private-label brands
C) national label brands
D) multiple source advantage
E) competitive brands

Question 54

Another name for store brands is brands.

A) national
B) exclusive
C) private-label
D) unique
E) generic

Question 55

A doughnut shop that decides to open up an hour earlier every morning is taking advantage of a opportunity.

A) diversification
B) market penetration
C) market divestment
D) retail format development
E) market depletion

Question 56

What is a benefit of having strong relations with a vendor?

A) Vendors supply complementary merchandise to their most profitable supporters.
B) Strong relations mean better profits for shareholders.
C) It is easier to return to a solid relationship with a vendor when private-labels fail.
D) A retailer could receive popular merchandise in short supply.
E) Vendors determine which retailers will receive the better prices.

Question 57

Market expansion opportunities help retailers grow by using:

A) new retail formats in existing market segments
B) existing retail formats in new market segments
C) existing retail formats in existing market segments
D) proven formats in experimental markets
E) new formats in new market segments

Question 58

In order to offer consistent customer service, retailers must:

A) offer incentives for employees who offer consistent services
B) instil its importance to their employees
C) demand it from their employees
D) invest more in information systems
E) do all of these

Question 59

A opportunity involves directing efforts toward existing customers by using its present retailing format.

A) diversification
B) market divestment
C) market expansion
D) market penetration
E) retail format development

Question 60

During football season at St. Mary's University, the university bookstore sells Huskies
merchandise to the loyal fans. This strategy is an example of

A) market depletion
B) diversification
C) retail format development
D) market penetration
E) market divestment

Question 61

The situation audit for a bagel shop might include an assessment of:

A) how changes in zoning and licensing laws will affect its operation
B) how membership in a local coffee club could affect its operation
C) the type of merchandise carried by the competition
D) the location of other retailers that sell bagels
E) all of these

Question 62

Florist Bruce Penney enjoyed his retail floral business, but his real love is kites. When a store site became available near his Ottawa shop, he opened Kite Corner, a store devoted to selling kites and anything associated with kites. Both stores are doing well, and Bruce splits his time between the two establishments. Bruce recognized a/an ________ opportunity.

A) market penetration
B) horizontal integration
C) vertical integration
D) unrelated diversification
E) related diversification

Question 63

Mark's Scratch and Dent sells slightly damaged name brand appliances at lower prices to lower income families. He is considering the implementation of a growth opportunity. Which of the following would most likely build on his present competitive advantage?

A) open a used furniture shop for the same target market
B) open an Internet store
C) extend the hours that the store is open
D) open a thrift store on the same block
E) open a similar store in a nearby community

Question 64

When Chapters.ca launched a website to sell its merchandise to its present customers, it
was taking advantage of a

A) market expansion
B) market penetration
C) diversification
D) market divestment
E) retail format development

Question 65

A ______ opportunity involves offering a new retail format to present customers.

A) market divestment
B) market penetration
C) diversification
D) retail format development
E) market expansion

Question 66

The _ of Gifts to Go is "to be the leading retailer of higher-priced gifts in Saint John and provide a stable income of $100,000 per year for the owner."

A) strategic plan
B) situation audit
C) strategic implementation
D) mission statement
E) organizational objectives

Question 67

The first step in the strategic retail planning process is to:

A) identify strategic opportunities
B) define the business mission
C) conduct the situation audit
D) develop a retail mix
E) assess the strengths and weaknesses of the business relative to its competition

Question 68

Arthur had trouble locating the top quality tomatoes that his customers wanted in their marinated tomato salads. When he could find no vendor to supply the tomatoes necessary for the salads, he invested in a farm in southern California to produce the tomatoes. Arthur engaged in:

A) horizontal integration
B) market expansion
C) market penetration
D) vertical integration
E) co-operative buying

Question 69

In terms of retailing strategy, what is a situation audit?

A) A decision-making process used by store buyers
B) An inventory control method
C) A daily plan for store operation
D) A weekly commentary on fashion
E) An analysis of the retail environment

Question 70

Jack runs a gallery that specializes in neon art with emphasis on vacation icons like flamingos, dolphins and palm trees. Since demand was high, and supplies were low, he decided to buy an old warehouse and hire craftspeople to work there to produce the art. He would provide them with all of the supplies they needed, and he would be their only customer. Jack engaged in:

A) market penetration
B) vertical integration
C) market expansion
D) co-operative buying
E) horizontal integration

Question 71

Florist Gail Duffy ran a small flower shop and sold plants and flowers to people in British Columbia. She believed that she could sell more flowers if she had means to use the Internet. Thus, she borrowed money and invested in creating a website called
Bloom.com where she sells flower arrangements to people all over the world using various flower delivery services. Gail has realized a/an opportunity.

A) market penetration
B) vertical integration
C) unrelated diversification
D) horizontal integration
E) related diversification

Question 72

Canadian Tire exploited a opportunity when it opened canadiantire.ca to sell its present line of merchandise to the same target market through a new retail format.

A) market expansion
B) retail format development
C) diversification
D) market penetration
E) market divestment

Question 73

Which of the following opportunities is least likely to exploit a retailer's competitive advantage?

A) retail format expansion
B) market expansion
C) diversification
D) market penetration
E) vertical integration

Question 74

After developing a mission statement and setting objectives, the next step in the strategic planning process is to:

A) implement the strategy
B) conduct a situation audit
C) allocate resources
D) contemplate competitive factors
E) evaluate the process and be willing to make adjustments

Question 75

When Burger King bought Tim Hortons, it was taking advantage of a(n) ________ opportunity.

A) related diversification
B) market divestment
C) market penetration
D) unrelated diversification
E) retail format development

Question 76

A opportunity involves an entirely new retail format directed toward a market segment that is not presently being served.

A) market expansion
B) market divestment
C) market penetration
D) diversification
E) retail format development

Question 77

In developing the mission statement for a retail chain, managers need to answer certain questions. Which of the following is one of those questions?

A) What is the scope of our planned activities?
B) What business are we in?
C) Who are our customers?
D) What are our objectives?
E) All of these

Question 78

Which of the following opportunities is most likely to exploit a retailer's greatest competitive advantage?

A) diversification
B) market penetration
C) retail format expansion
D) market expansion
E) vertical integration

Question 79

Which of the following is an example of diversification?

A) market penetration
B) retail format development
C) cross-selling
D) vertical integration
E) market expansion

Question 80

The retail plan. is the set of steps that a retailer should go through to develop a strategic

A) strategic retail control process
B) situation audit
C) strategic retail planning process
D) strategic retail implementation
E) tactical retail implementation