Question 1

Profitability increases as a business gains share relative to competitors in its ________.
A) higher market
B) direct market
C) secondary market
D) served market
E) valued market

Accepted Answer

The served market refers to the specific group of customers that a business is targeting with its products or services. As a business gains share within this market, it is able to achieve economies of scale and more efficiently serve these customers, which can lead to increased profitability. The other options are either unclear or do not accurately describe the market in question.

Question 2

Which of the following is a market leader strategy?
A) expanding market share
B) multiple niching
C) full frontal attack
D) following at a distance
E) following closely

Accepted Answer

Expanding market share is a market leader strategy as it involves taking actions to increase the company's share of the market and maintaining its position as the leader. Multiple niching, full frontal attack, following at a distance, and following closely are not necessarily strategies for market leaders, but rather general market strategies that can be used by any company.

Question 3

Samsung and Apple are open to new ideas, relentlessly pursue new solutions, and work to get new products to market quickly. They serve customers who want state-of-the-art products and services, regardless of the costs in terms of price or inconvenience. Which of the following value disciplines is illustrated from this example?
A) operational excellence
B) customer intimacy
C) product leadership
D) product activation
E) product binning

Accepted Answer

Samsung and Apple's emphasis on new ideas, pursuing solutions and speedy product launches illustrates their focus on product leadership - constantly staying ahead of their competitors by offering cutting-edge products and technology. This is different from operational excellence (which focuses on efficient operation and cost optimization) and customer intimacy (which prioritizes customization and personalized service for individual customers). Product activation and product binning are not relevant in this context.

Question 4

Market leaders can expand the market by ________ and more usage of the product.
A) identifying competitors
B) initiating monopolistic practices
C) developing new users
D) ensuring users adhere to higher standards
E) initiating new rules for product users

Accepted Answer

Market leaders can expand the market by developing new users through marketing campaigns or targeting new demographic segments. This can be done by identifying untapped markets or creating new uses for the product. Initiating monopolistic practices, ensuring users adhere to higher standards, and initiating new rules for product users may actually limit the market and potentially harm the company. Identifying competitors is important for any business, but does not directly expand the market.

Question 5

To remain number one, leading firms can take any of three actions. First, they can find ways to expand total demand. Second, they can protect their current market share through good defensive and offensive actions. Third, they can ________.
A) focus exclusively on divestment
B) evaluate current employees and reduce costs through downsizing
C) run smaller companies out of business, causing them to sell out to larger firms
D) try to expand their market share further, even if market size remains constant
E) shut down current company locations and reopen in highly populated areas

Accepted Answer

The passage suggests that leading firms can remain number one by taking three actions; expanding total demand, protecting their current market share, and trying to expand their market share further. The options A, B, and E are not mentioned as viable actions for leading firms. Option C is unethical and illegal, and hence not a valid choice. Therefore, the best choice is D.

Question 6

The market leader normally gains the most when ________.
A) its total market diminishes
B) it achieves expanded market share
C) its personal communication channels expand
D) the niche marketing efforts by other firms expand
E) the major global competitors enter the market

Accepted Answer

The market leader gains the most when it achieves expanded market share, which allows it to increase revenue and profits.

Question 7

Fifty percent of the market is in the hands of Company A. Another 30 percent is in the hands of Company B. Fifteen percent is in the hands of Company C, and the remaining five percent is in the hands of Company D. Based on these hypothetical numbers, Company D is the market ________.
A) leader
B) challenger
C) follower
D) nicher
E) maven

Accepted Answer

Company D is the market nicher because it only holds five percent of the market share, which makes it specialized in serving a smaller segment of the market. The market leader is Company A, the challenger is Company B, and Company C is the follower. Maven refers to a person who has expert knowledge and advises others in a particular field, but it is not relevant to the market share distribution amongst companies.

Question 8

________ are those runner-up firms that are working to increase their market share in an industry.
A) Market leaders
B) Market challengers
C) Market followers
D) Market mavens
E) Market nichers

Accepted Answer

Market challengers are firms that are working to increase their market share in an industry, often by directly challenging the market leader. The other choices are not relevant to this definition.

Question 9

Lovelies is the leading workout and fitness center for women. The regional chain of gyms has traditionally catered to women forty and older who are interested in strength and cardio-vascular training. Lovelies has recently begun promotions to bring younger women into its gyms. This is an example of how the market leader ________.
A) competes with mature products
B) changes its product line
C) develops new rules
D) develops new users
E) increases competition

Accepted Answer

Lovelies is targeting a new demographic (younger women) to expand its customer base, which is an example of developing new users.

Question 10

Although it might seem that the market leader has the most going for it, challengers often have what some strategists call a ________. The challenger observes what has made the leader successful and improves upon it.
A) "marketing myopia"
B) "second mover advantage"
C) "absolute advantage"
D) "blue ocean strategy"
E) "red ocean strategy"

Accepted Answer

The phrase "second mover advantage" is used to describe challengers who have the opportunity to observe the leader's strategy and identify ways to improve upon it. This can give them an advantage over the market leader in terms of innovation and adapting to changing market conditions. The other options do not accurately reflect this concept. "Marketing myopia" refers to a narrow focus on short-term marketing tactics, while "absolute advantage" is a term used in economics to describe a country's ability to produce a good more efficiently than another country. "Blue ocean strategy" and "red ocean strategy" refer to different approaches to creating new market spaces, but they do not specifically relate to the advantages of being a challenger in an existing market.

Question 11

Marketers can expand markets by discovering and promoting ________.
A) subliminal points of interest
B) the deficiencies of competitors
C) subtle advantages of the product
D) new uses of the product
E) green technologies

Accepted Answer

By discovering and promoting new uses of the product, marketers can expand the market and reach new customers who may not have considered the product previously. This can also help differentiate the product from competitors and highlight its unique benefits.

Question 12

Most of the market is in the hands of the ________, the firm with the largest market share.
A) market challenger
B) market follower
C) market leader
D) market nicher
E) market maven

Accepted Answer

The market leader holds the largest market share, giving them the most control and influence over the market. The other options describe competitors who may have smaller market shares or niche focuses.

Question 13

A market challenger that matches the competitor's product, advertising, price, and distribution efforts is most likely ________.
A) creating multiple niches
B) pursuing an indirect attack
C) launching a full frontal attack
D) exiting from the current market
E) implementing a blue ocean strategy

Accepted Answer

Launching a full frontal attack means directly matching the competitor's efforts in all aspects, giving a head-on competition. This strategy can be effective if the challenger has the necessary resources and capabilities to compete.

Question 14

Firms that serve small segments not being pursued by other firms are called ________.
A) market followers
B) market mavens
C) market challengers
D) market nichers
E) market leaders

Accepted Answer

Firms that serve small segments not being pursued by other firms are called market nichers.

Question 15

Which of the following is a competitive position or role that firms play in the target market?
A) surrogate consumer
B) market analyst
C) market maven
D) market nicher
E) laggard

Accepted Answer

Market nicher is a competitive position or role that firms play in the target market. Surrogate consumer refers to a person who is hired by a consumer to make purchase decisions on their behalf, market analyst is a professional who analyzes market trends and data, market maven is an individual who has a lot of knowledge and expertise in a particular market, while laggard refers to a person who is slow to adopt new ideas or technologies.

Question 16

Which of the following is the best response a company can make to competitive threats?
A) continuous innovation
B) surrender to the competitor
C) exit from the market
D) divestment
E) globalization

Accepted Answer

Continuous innovation allows a company to stay ahead of its competition by offering new and improved products and services that meet the evolving needs of its customers. It also allows a company to differentiate itself from its competitors and build brand loyalty among its customer base. Surrendering to the competitor, exiting the market, or divesting can negatively impact a company's reputation and may lead to financial loss. Globalization may not necessarily address competitive threats in a specific market.

Question 17

A runner-up firm that wants to hold its share in an industry without rocking the boat is a ________.
A) market follower
B) market maven
C) market challenger
D) market nicher
E) market leader

Accepted Answer

A market follower is a firm that wants to maintain its market share without taking significant risks that would threaten its stability in the industry. The firm does not actively seek to challenge the market leader or change the status quo, but rather follows the trends and strategies of the market leader.

Question 18

________ can adopt one of two competitive strategies: they can challenge the leader or they can play along with competitors and not rock the boat.
A) Runner-up firms
B) Market nichers
C) Global investors
D) Localized marketers
E) Market developers

Accepted Answer

Runner-up firms are typically strong enough to challenge the leader in a market. By challenging the leader, they can try to capture more market share and increase their own profitability. However, if the runner-up firm is not strong enough to challenge the leader, playing along with competitors and not rocking the boat may be the best strategy to maintain their position in the market. The other options (B, C, D, E) do not necessarily have the same level of power or position in a market to effectively adopt either of these strategies.

Question 19

Which of the following are market challenger strategies?
A) expand total market and protect market share
B) expand market share and follow closely
C) full frontal attack and indirect attack
D) follow closely and follow at a distance
E) multiple niching and quality service

Accepted Answer

Full frontal attack and indirect attack are both market challenger strategies. Option A refers to a market development strategy and option B refers to a market follower strategy. Option D and E are not specific market challenger strategies.

Question 20

Fifty percent of the market is in the hands of Company A. Another 30 percent is in the hands of Company B. Fifteen percent is in the hands of Company C, and the remaining five percent is in the hands of Company D. Based on these hypothetical numbers, Company B is the market ________.
A) leader
B) challenger
C) follower
D) nicher
E) maven

Accepted Answer

According to the given information, Company A holds 50% of the market share which makes them the market leader. Company B holds 30% of the market share which makes them the market challenger as they are the only company with a significant market share to challenge the market leader. Company C holds only 15% of the market share which makes them a market follower. Lastly, Company D holds only 5% of the market share which makes them a market nicher.

Quiz 18: Creating Competitive Advantage

Profitability increases as a business gains share relative to competitors in its ________.

Which of the following is a market leader strategy?

Market leaders can expand the market by ________ and more usage of the product.

To remain number one, leading firms can take any of three actions. First, they can find ways to expand total demand. Second, they can protect their current market share through good defensive and offensive actions. Third, they can ________.

The market leader normally gains the most when ________.

Fifty percent of the market is in the hands of Company A. Another 30 percent is in the hands of Company B. Fifteen percent is in the hands of Company C, and the remaining five percent is in the hands of Company D. Based on these hypothetical numbers, Company D is the market ________.

________ are those runner-up firms that are working to increase their market share in an industry.

Although it might seem that the market leader has the most going for it, challengers often have what some strategists call a ________. The challenger observes what has made the leader successful and improves upon it.

Marketers can expand markets by discovering and promoting ________.

Most of the market is in the hands of the ________, the firm with the largest market share.

A market challenger that matches the competitor's product, advertising, price, and distribution efforts is most likely ________.

Firms that serve small segments not being pursued by other firms are called ________.

Which of the following is a competitive position or role that firms play in the target market?

Which of the following is the best response a company can make to competitive threats?

A runner-up firm that wants to hold its share in an industry without rocking the boat is a ________.

________ can adopt one of two competitive strategies: they can challenge the leader or they can play along with competitors and not rock the boat.

Which of the following are market challenger strategies?

Fifty percent of the market is in the hands of Company A. Another 30 percent is in the hands of Company B. Fifteen percent is in the hands of Company C, and the remaining five percent is in the hands of Company D. Based on these hypothetical numbers, Company B is the market ________.