Question 1

A company's close competitors are ________.

Accepted Answer

Close competitors are those that most resemble the company's operations, as they offer similar products or services and target similar markets, making them the most direct competition.

Question 2

If a company's offer delivers greater value by exceeding the competitor's offer on important attributes, the company can charge a higher price and ________, or it can charge the same price and ________.

Accepted Answer

If a company offers greater value, it can charge a higher price to earn higher profits or charge the same price to gain more market share by attracting more customers.

Question 3

Marketers need an in-depth understanding of ________ if they want to anticipate how that competitor will act.

Accepted Answer

Understanding a competitor's mentality helps marketers anticipate their actions by providing insights into their strategic thinking and decision-making processes.

Question 4

Which of the following are examples of close competitors?

Accepted Answer

McDonald's and Burger King are both fast food chains that serve similar types of food and compete for similar customer markets. The other options include one fast food chain and one restaurant chain, which may not be as close of competitors.

Question 5

A firm should compete with ________ competitors in order to sharpen its abilities. Succeeding against these competitors often provides greater returns.

Accepted Answer

Competing with strong competitors challenges a firm to improve and innovate, allowing them to reach their full potential and achieve greater returns. Competing with weaker or distant competitors may not provide the same level of challenge and may not lead to as much growth or success. International competitors may bring unique challenges, but the level of competition may vary and may not always be the best choice for a firm. Smaller competitors may not provide enough challenge or opportunity for growth.

Question 6

In the context of identifying competitors' strategies, the more that one firm's strategy resembles another firm's strategy, the more likely the two firms are to ________.

Accepted Answer

If two firms have similar strategies, they are more likely to target the same market segments, customers, and resources, which will inevitably lead to competition between them. Therefore, the best choice is B, compete. The other options are less likely outcomes of similar strategies between two firms.

Question 7

An industry often contains "good" and "bad" competitors. Good competitors ________.

Accepted Answer

Good competitors are those who play by the rules of the industry and compete in a fair and ethical manner. They do not engage in unethical or illegal practices, and instead rely on their own strengths and advantages to succeed.

Question 8

An analysis conducted to determine what benefits target customers value and how they rate the relative value of various competitors' offers is known as ________.

Accepted Answer

This is the definition of customer value analysis, which helps companies understand what customers value most and how they perceive competing offers. Customer lifetime value refers to the total value a customer will provide to a company over the course of their relationship. Quantitative analysis is a general term that refers to using data and statistical methods to analyze a problem. A brand value proposition is a statement that communicates the unique value a brand offers. Benchmarking involves comparing a company's performance to industry or competitor benchmarks.

Question 9

What is most likely a strategic benefit of the existence of competitors?

Accepted Answer

Competitors provide market validation and acceptance for new technologies or products. This helps to establish credibility for the product or technology, which can eventually lead to greater sales and market share for the company.

Question 10

In conducting ________, the company first identifies the major attributes that customers value and the importance customers place on these attributes. Next, it assesses its performance against competitors on those valued attributes.

Accepted Answer

This describes the process of conducting a customer value analysis, where the company identifies the attributes that customers value and assesses their performance against competitors. Benchmarking involves comparing a company's performance against industry standards, while entrepreneurial marketing and intrepreneurial marketing involve innovative marketing strategies and mindset. Customer lifetime value estimate refers to the predicted revenue a customer will generate over their lifetime with a company.

Question 11

Companies need to know each competitor's product quality, features, and mix; customer services; pricing policy; distribution coverage; sales force strategy; and advertising and sales promotion programs. These are all the dimensions that identify ________ groups within the industry.

Accepted Answer

The dimensions mentioned in the statement are all related to strategic groups within the industry, as they are all factors that can impact a company's competitive strategy and positioning within the market.

Question 12

A market research firm conducts a survey of soft-drink consumers to assess Pepsi's and Coke's strengths and weaknesses in attributes valued by both company's target customers. The market research firm is using a ________.

Accepted Answer

The market research firm is using a customer value analysis, which involves assessing the strengths and weaknesses of a product in relation to its competitors based on attributes valued by customers.

Question 13

Companies use secondary data, personal experience, and word of mouth to ________.

Accepted Answer

Secondary data, personal experience, and word of mouth can provide insights into competitors' strengths and weaknesses, such as their market position, product offerings, and marketing strategies. This information can help companies to better understand their competitive landscape and develop effective strategies to compete. However, using these sources alone may not provide a complete picture of competitors' target customers, locations, sales projections, or other important details.

Question 14

Country Kitchen and Perkins are both a chain of family restaurants featuring diner-like menus with reasonably priced items. These companies are in the same ________.

Accepted Answer

Country Kitchen and Perkins are in the same strategic group, meaning they are direct competitors with similar market positioning and customer base. The other answer choices are not applicable in this context.

Question 15

Benchmarking has become a powerful tool for increasing a company's ________.

Accepted Answer

Benchmarking involves identifying best practices and comparing them to one's own practices in order to identify opportunities for improvement. Therefore, it can be a powerful tool for increasing a company's competitiveness by improving their processes, products, and overall performance.

Question 16

A company's objectives indicate its satisfaction with its current situation and ________.

Accepted Answer

The answer of A company's objectives indicate its satisfaction with...

Question 17

________ is the process of comparing the company's products and processes to those of competitors or leading firms in other industries to find ways to improve quality and performance.

Accepted Answer

The process described in the question is benchmarking. Benchmarking involves analyzing and comparing a company's products and processes to those of its competitors or leading firms in other industries to identify areas for improvement.

Question 18

In the audio equipment industry, Philips and Sony belong to the same ________.

Accepted Answer

Strategic groups refer to companies that compete in the same industry and target the same customers with similar products and pricing strategies. Philips and Sony both operate in the audio equipment industry and target similar customers with comparable products. Therefore, they belong to the same strategic group. The other options (A, C, D, and E) do not accurately describe the relationship between Philips and Sony in the industry.

Question 19

Most companies will compete with ________ rather than ________.

Accepted Answer

Close competitors are those that are in the same market, offer similar products or services, and target the same customers. These are the companies that businesses will compete with on a day-to-day basis and try to gain market share from. Distant competitors, on the other hand, operate in different markets and offer different products or services, so they pose less of a direct threat. Therefore, competing with close competitors is more important for most companies than competing with distant competitors.

Question 20

A company that pursues ________ will react much more strongly to a competitor's cost reducing manufacturing breakthrough than to the same competitor's advertising increase.

Accepted Answer

A company pursuing low-cost leadership will prioritize cost reduction and efficiency. Therefore, any move by a competitor that threatens their position as the lowest-cost provider will be seen as a significant threat and elicit a strong reaction. In contrast, an increase in advertising spending by a competitor may not affect a low-cost leader as significantly.

Quiz 18: Creating Competitive Advantage