Deck 7: Developing Marketing Strategy

Question 1

A successful strategy promotes coordination among functional areas of the organization.

Answer 1

True

Question 2

Basically, every firm has only one goal-profit maximization.

Answer 2

False

Question 3

The objective to be maximized is the primary objective with constraints imposed by secondary objectives.

Answer 3

True

Question 4

Ideally, objectives should have quantified standards of performance, be challenging but realistic and have a set time frame for accomplishment.

Question 5

Market development strategies are directed toward selling the current product to current customers.

Question 6

Customer expansion is a market development strategy.

Question 7

Comparative advertising is a low risk, low cost way to build market share by taking customers from competitors.

Question 8

Since 80 percent of a firm's profits are often generated by 20 percent of its products, strategic support should be targeted to heavily support those offerings.

Question 9

The core strategy, often called product positioning, defines the differential advantage to be communicated to the target market.

Question 10

The basic task of the product manager is to develop a single strategy that can be successful throughout the product's life cycle.

Question 11

Identify the INCORRECT statement pertaining to a successful strategy

A) It enhances coordination
B) It defines how resources will be allocated
C) It leads to a superior market position
D) It takes cognizance of existing and potential competitors
E) It discourages the sharing of resources

Question 12

A competitively sensible marketing strategy

A) Is something a competitor can do
B) Is something a competitor will choose to do
C) Would put competitors at a disadvantage if they do it
D) Would cause us to loose if competitors do it
E) Is never based on proprietary or technological advantage

Question 13

Which element of the marketing strategy for a product is MORE likely to establish the general direction of the strategy?

A) Customer targets
B) Competitor targets
C) The core strategy
D) Functional programs support
E) The objective(s) to be attained

Question 14

Customer targets, competitor targets and the core strategy are the elements of

A) The supporting marketing mix
B) Positioning
C) Functional programs
D) Strategy implementations
E) Objective alternatives

Question 15

How the product is to be differentiated from the competition in the minds of the target customers is known as

A) Product positioning
B) Product development
C) Market development
D) Target marketing
E) Market segmentation

Question 16

Objectives should have

A) Nonquantitative standards
B) Challenging and out of reach goals
C) No set time frame
D) A metric on which to evaluate performance
E) Ambitious and unrealistic targets

Question 17

Which of the following strategic alternative is LESS likely to be aimed at improving long-term profits through growing sales or market share?

A) Market development
B) Market penetration
C) Price increase
D) Entering new segments
E) Converting nonusers

Question 18

All of the following strategic alternatives are MORE likely to be aimed at improving efficiency and short-term profits EXCEPT:

A) Improving asset utilization
B) Market development
C) Increasing outputs
D) Decreasing inputs
E) Reducing costs

Question 19

Arm and Hammer Baking soda, marketed as being useful for cleaning and deodorizing vinyl shower curtains, BEST exemplifies a market development strategy aimed at

A) Nonusers in segments already targeted
B) Entering new markets through repositioning
C) Comparative advertising to increase user base
D) Attracting competitors' customers
E) Inducing brand switching

Question 20

Which of the following approaches to increasing sales is MOST likely to be overlooked?

A) Increasing usage rate of existing customers
B) Entering new segments
C) Developing new products
D) Developing new markets
E) Reducing prices

Question 21

Identify the INCORRECT statement about seeking growth by attracting competitor's customers.

A) It is difficult if switching costs are low
B) It may require costly sales promotion efforts
C) It may invite retaliation from larger competitors
D) It may require risky comparative advertising
E) It can incur the wrath of a competitor

Question 22

The objective of increasing profitability is LESS likely to be accomplished by

A) Increasing costs
B) Improving asset utilization
C) Concentrating on customer retention
D) Improving the sales mix
E) Reducing customer turnover

Question 23

In selecting a customer market, a manager should consider all of the following EXCEPT:

A) Size of the segment
B) Growth of the segment
C) Opportunities for obtaining competitive advantage
D) Available resources
E) That the segment is heterogeneous within

Question 24

The core strategy defines the differential advantage to be communicated to the target customers, often referred to

A) Product positioning
B) Product development
C) Market development
D) Target marketing
E) Market segmentation

Question 25

If there are many suppliers of undifferentiated commodities, market price tends to

A) Favor profit maximization goals
B) Approach marginal cost
C) Higher than in pure competition
D) Increase over time
E) Fluctuate violently

Question 26

The _____ product includes features or benefits that can be delivered now to exceed customer expectations.

A) Total
B) Generic
C) Expected
D) Augmented
E) Potential

Question 27

The _____ product contains features / benefits that can be added to a product or service at some future time.

A) Total
B) Potential
C) Augmented
D) Generic
E) Expected

Question 28

Differentiation may be achieved by focusing on all of the following EXCEPT:

A) Quality
B) Status / image
C) Branding
D) Convenience / service / distribution
E) Generic similitude

Question 29

Circumstantial loyalty is MOST likely to result from

A) Proprietary assets
B) Efficiency motive
C) Personal associations
D) Brand communities
E) Advocacy

Question 30

The strongest form of loyalty is _____, where the customer doggedly seeks out a product, often out of deference to its role in a previous situation and sometimes in an almost ritualistic manner.

A) Proprietary
B) Efficiency
C) Attachment
D) Image
E) Preference

Question 31

Brand associations, taken together, form a

A) Brand personality
B) Brand status
C) Prestige brand
D) Stable image
E) Personal image

Question 32

Which of the following is LESS likely to be a successful form of advocacy?

A) Word of-mouth
B) Joining brand communities
C) Recommending a brand
D) Acting as a brand missionary
E) Creating an artificial buzz

Question 33

Which of the following is NOT likely to be useful as a guideline for building strong brands?

A) Each brand should have an identity that cannot be modified for different segments
B) Each brand should have a unique value proposition
C) The brand's position should provide clear guidance to those implementing a communications program
D) The brands in the portfolio should be consistent and synergistic
E) Continue investing in brands even when the financial goals are not being met

Question 34

Getting new customers by market development or market penetration by capturing competitors' customers is BEST known as

A) Customer expansion
B) Customer acquisition
C) Customer retention
D) Customer deletion
E) Customer creation

Question 35

Keeping current customers satisfied via enhancing brand loyalty or through superior service BEST exemplifies

A) Customer expansion
B) Customer deletion
C) Customer retention
D) Customer creation
E) Customer acquisition

Question 36

Cross-selling and increasing usage are tactics most closely associated with which of the following strategies?

A) Customer acquisition
B) Customer deletion
C) Customer creation
D) Customer expansion
E) Customer retention

Question 37

Dropping customers that are not profitable in such a way as to not generate legal problems or public relations disasters is known as

A) Customer creation
B) Customer expansion
C) Customer deletion
D) Customer retention
E) Customer acquisition

Question 38

Identify the INCORRECT statement about a skimming strategy

A) It targets customers that are least price sensitive
B) It is useful when the cost structure of the product is largely variable
C) It assumes a product feature-based differential advantage
D) It allows a company to enter the market with a high price
E) It uses a low-price core strategy

Question 39

Which of the following statement is NOT true about a penetration strategy?

A) It uses a low-price core strategy
B) It is appropriate when fixed costs are high
C) It is more appropriate when initial sales lead to long-run customers' retention
D) It is most effective when high entry barriers exist
E) It attempts to get customers and establish a significant market share position as quickly as possible

Question 40

All of the following are first-mover advantages EXCEPT:

A) Guaranteed success
B) First access to distribution channels
C) Early to establish awareness
D) Easy opportunity to establish brand loyalty
E) First to create preferences

Question 41

Consumer electronics and industrial product companies almost always pursue a

A) Penetration strategy
B) Intensive strategy
C) Skimming strategy
D) Stability strategy
E) Negative strategy

Question 42

Typically during the growth stages of the PLC all of the following happen, EXCEPT

A) Product category sales grow
B) The number of competitors decreases
C) Promotion focuses on brand superiority
D) Price competition intensifies
E) Market segmentation begins to be a key issue

Question 43

Identify the INCORRECT statement pertaining to the maturity stage of the PLC.

A) Promotional costs are high
B) Price competition is fierce
C) Repeat purchases are critical
D) Differentiation, if it exists is based on intangibles
E) Number of new buyers enter the market

Question 44

A _____, during the maturity stage of the product life cycle, allows a gradual share decline with minimal investment to maximize short-run profits.

A) Leapfrog strategy
B) Harvesting strategy
C) Segmentation strategy
D) Skimming strategy
E) Penetration strategy

Question 45

All of the following occur during the decline stage of the PLC EXCEPT:

A) Sales decline
B) Number of competitors decline
C) Older products become obsolete
D) The last firm in the market may be profitable for some time
E) Category sales increase

Question 46

BRIEFLY identify the key outcomes of successful strategy. What are the desirable characteristics of a good strategy?

Question 47

What is the primary goal of market penetration strategies? BRIEFLY evaluate the two basic approaches for achieving that goal.

Question 48

What is meant by "positioning"? BRIEFLY evaluate the two basic ways in which this may be accomplished.

Question 49

BRIEFLY evaluate the attractiveness of quality as a differentiation strategy.

Question 50

BRIEFLY relate the four basic customer strategies to the stage of the PLC.