Question 1

When the Walt Disney Company opened Disneyland Paris for the French market,it was an example of market penetration.

Accepted Answer

Market penetration is the strategy of selling more to the existing customers.This is an example of a market development strategy,which is attracting new customers to existing products.

Question 2

A portfolio model is a tool for allocating resources among products or strategic business units on the basis of relative market share and degree of innovation.

Accepted Answer

A portfolio model is based on relative market share and market growth rate.

Question 3

In theory,an SBU should have its own resources for handling basic business functions.

Accepted Answer

An SBU (Strategic Business Unit) is a fully functional and separate entity within a larger organization, and thus should have its own resources for handling basic business functions such as accounting, human resources, and marketing. This allows for better decision making and autonomy within the SBU.

Question 4

A diversification strategy entails increasing sales by introducing new products into new markets.

Accepted Answer

A diversification strategy involves expanding a company's range of products or services into new markets in order to increase sales and revenue. This can be done through new product development or acquisition of other businesses.

Question 5

When a florist shop begins to sell burial caskets to its customers,it is engaged in product development.

Accepted Answer

Product development is the offering of new products to current markets.

Question 6

A production costs analysis could be a part of a company's SWOT analysis.

Accepted Answer

A production costs analysis is an important factor to consider when analyzing a company's strengths, weaknesses, opportunities, and threats. Understanding the costs associated with production can help a company identify areas where they can improve efficiency and reduce costs, thereby strengthening their position in the market.

Question 7

A competitive advantage is the set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition.

Accepted Answer

This is the definition of a competitive advantage.

Question 8

The marketing plan is a written document that acts as a guidebook of marketing activities for a marketing manager.

Accepted Answer

The marketing plan is a written document that outlines the marketing strategies, tactics, and activities to be implemented by a marketing manager. It serves as a guidebook for the marketing team to achieve the organization's marketing objectives.

Question 9

The harvest strategy is appropriate for all SBUs except dogs.

Accepted Answer

The harvest strategy is appropriate for all SBUs except stars.

Question 10

Niche competitive advantages are difficult to develop and consequently are quite rare.

Accepted Answer

The text lists several examples of how companies have created niche competitive advantages.

Question 11

Environmental scanning entails the collection and interpretation of information about factors in the external environment that may affect the future of the organization or the implementation of the marketing plan.

Accepted Answer

Environmental scanning is the process of gathering information about external factors that may impact an organization or its marketing plan in the future. This information can include economic, political, social, technological, legal, and environmental factors. The purpose of environmental scanning is to identify potential threats and opportunities, and to help the organization make informed decisions about its strategy and tactics.

Question 12

In the portfolio mix,notebook computers would be an example of a star.

Accepted Answer

A star is a market leader that is growing fast.

Question 13

To be useful,marketing objectives should be realistic,measurable,time specific,and based on sales.

Accepted Answer

The four criteria for useful marketing objectives are: realistic, measurable, time specific, and compared to a benchmark. They do not have to be based on sales.

Question 14

The Home Depot's purchase of Hughes Supply Company allows it to better meet the needs of its current business customers.This is an example of product development.

Accepted Answer

The Home Depot's purchase of Hughes Supply Company expands its product offerings and capabilities, which is an example of product development. It allows the company to better serve the needs of its existing business customers.

Question 15

In the General Electric model,SBUs that have low overall attractiveness should be avoided if the organization is not already serving them.

Accepted Answer

According to the General Electric model for portfolio analysis, SBUs with low overall attractiveness should either be divested or restructured. However, this does not mean that they should be completely avoided, especially if the organization has the capability and resources to improve their attractiveness over time.

Question 16

A market penetration strategy entails the creation of new products for current customers.

Accepted Answer

This is an example of product development strategy.A market penetration strategy in one that tries to increase market share among existing customers.

Question 17

A firm's mission statement should answer the question,"What products do we produce best?"

Accepted Answer

Mission statements should not focus on specific product offerings but on the market or markets served.

Question 18

As marketers gain more experience in marketing a product,costs tend to decrease,which is an example of the maturity effect.

Accepted Answer

This is an example of the experience curve effect, which means costs decline at a predictable rate as experience with a product increases.

Question 19

The manufacturer of Macho brand martial arts products was implementing a strategic plan when it sponsored a local karate tournament for teenagers.

Accepted Answer

Such a short-range decision is typically a tactical plan or operating decision,not a strategic plan.

Question 20

Developing a cost competitive advantage can enable a firm to deliver superior customer value.

Accepted Answer

Developing a cost competitive advantage means that a firm can produce and deliver its products or services at a lower cost than its competitors. This can enable the firm to offer lower prices to customers or invest in quality, service, or innovation, which can enhance customer value and satisfaction. Therefore, a cost competitive advantage can help a firm to achieve superior customer value, which is a key driver of business success and growth.

Quiz 2: Strategic Planning for Competitive Advantage