Question 1

Which of the following is most critical for successful niching?

Accepted Answer

Successful niching requires specialization, or the ability to focus on a specific area of expertise or market segment. This allows businesses to differentiate themselves from competitors and become the go-to source for that particular niche. While the other options may be important for business success in general, they are not directly related to successful niching.

Question 2

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

Accepted Answer

The "second mover advantage" refers to the idea that a challenger can observe and learn from the strengths and weaknesses of the market leader and then improve upon them to gain an advantage. This is often a successful strategy because the challenger can avoid the mistakes made by the leader and capitalize on what the leader has done well.

Question 3

Refer to the scenario below to answer the following question(s).
Essential-Beauty is a rapidly growing firm that manufactures women's makeup, perfumes, and nail-care products. The company has established itself as a high-end cosmetic product brand available at most national drug stores. In the past, almost all of the advertising for Essential-Beauty has been in women's fashion magazines.
The firm is now launching a new line of skin care products, ranging from facial cleansers to body lotion. These products are designed to be marketed to a broader audience, so the marketing team is exploring the effectiveness of different promotional mixes.
-Before deciding to launch the new line of products, Essential-Beauty conducted extensive market research to make sure the products were optimally positioned. A complete marketing plan including mobile advertising, magazine advertising, event sponsorship, and sales promotions was established long before the products themselves were ready for market. In this case, Essential-Beauty was using ________.

Accepted Answer

Essential-Beauty was using formulated marketing, which involves conducting extensive research to establish a complete marketing plan before launching a new product or service. This includes determining the optimal promotional mix and positioning strategy to reach the target market effectively.

Question 4

The market subsegment that a company exclusively caters to may dry up, or it might grow to the point that it attracts larger competitors. This is why such companies practice ________.

Accepted Answer

Multiple niching is the practice of targeting multiple, distinct market subsegments with different products or services. This strategy helps to spread out the company's risks and allows it to adapt to changes in the market without relying too heavily on any one subsegment. This makes it a good approach for companies that are vulnerable to changes in their target market.

Question 5

Entrepreneurial marketing exclusively involves developing formal marketing strategies and adhering to them closely.

Accepted Answer

Entrepreneurial marketing often involves being flexible and adapting quickly to market changes, rather than sticking strictly to a pre-determined marketing plan. It may also involve more creative and unconventional tactics to gain visibility and attract customers.

Question 6

Whereas the mass marketer achieves ________, the nicher achieves ________.

Accepted Answer

The answer of Whereas the mass marketer achieves ________, the...

Question 7

Computer mouse and interface device maker AdvTechPRO is only a fraction the size of software giant Terminal Time Software Inc. AdvTechPRO manufactures every variation of computer mouse imaginable (for left-handed people, wireless mice, shaped like actual mice, LED mice, etc.). Through skillful ________, the firm dominates the PC mouse market, with Terminal Time Software as its runner up.

Accepted Answer

The skillful "niching" of AdvTechPRO, as stated in the passage, enabled the firm to dominate the PC mouse market.

Question 8

Many large and mature companies get stuck in formulated marketing. They pore over the latest Nielsen numbers, scan market research reports, and try to fine-tune their competitive strategies and programs.

Accepted Answer

The statement mentions that many large and mature companies get stuck in formulated marketing, relying on market research reports and competitive strategies.

Question 9

Cozy Country Market entered the candle business with a unique product: a line of candles made from soy that produces less smoke and lasts up to twice as long as other candles. The firm sold this unique product exclusively to a few niches. The candles were priced at twice the cost charged for normal candles. The product was also sold online and in unconventional outlets not dominated by market leaders. In this case, Cozy Country Market was using a(n) ________ against the market leaders.

Accepted Answer

Cozy Country Market was using an indirect attack against the market leaders by creating a unique product and selling it exclusively to a few niches at a higher price point. They also sold the product in unconventional outlets not dominated by market leaders, allowing them to gain a foothold in the market without directly competing with the established leaders. This strategy is often used by smaller firms to gain a competitive advantage in a crowded market.

Question 10

Which of the following conditions would enable higher market share to produce higher profits?

Accepted Answer

When unit costs drop as market share increases, the company can lower its prices and still maintain profit margins. This results in increased demand and further growth of market share, which can lead to even lower unit costs and higher profits.

Question 11

Almost every industry includes firms that specialize in serving target subsegments called market ________.

Accepted Answer

Market niches are specific subdivisions within a larger market that companies serve by tailoring their products or services to meet the unique needs of the niche. The term "mavens" is not commonly used in marketing to describe target subsegments. "Baskets" and "mixes" have no relation to target subsegments in marketing, and "indicators" may refer to market research metrics but not subsegments.

Question 12

According to the overall cost leadership competitive strategy, the company works hard to achieve the lowest production and distribution costs.

Accepted Answer

According to the overall cost leadership competitive strategy, the company strives to achieve the lowest production and distribution costs to be able to offer lower prices and attract price-sensitive customers.

Question 13

Formulated marketing focuses on the entrepreneurial aspects of marketing.

Accepted Answer

Formulated marketing focuses on developing and implementing structured marketing strategies, rather than the entrepreneurial aspects which are more about innovation and adaptability.

Question 14

Rather than challenging head on, a challenger can make a(n) ________ attack on the competitor's weaknesses or on gaps in the competitor's market coverage.

Accepted Answer

An indirect attack targets weaknesses or gaps in the competitor's market coverage, rather than directly challenging them. This can be a more subtle and effective way to gain an advantage over the competition.

Question 15

Which of the following statements is most likely true of market follower strategies?

Accepted Answer

The answer of Which of the following statements is most...

Question 16

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

Accepted Answer

When a market challenger matches the competitor's product, advertising, price, and distribution efforts, it is pursuing a full frontal attack strategy. This strategy involves directly confronting the competitor and trying to gain market share by offering a similar product at a similar price and making its product available through similar distribution channels.

Question 17

A market nicher can most likely specialize along all of the following lines EXCEPT ________.

Accepted Answer

Mass marketing is the opposite of market niching, where a company targets a broad audience instead of a specific niche. Therefore, a market nicher would not specialize in mass marketing.

Question 18

Gary Hirshberg started the Stonyfield Farm yogurt company. His marketing strategy: building a casual bond with customers using guerilla marketing. This is an example of formulated marketing.

Accepted Answer

This is an example of grassroots marketing, not formulated marketing. Formulated marketing involves carefully planned and executed marketing campaigns, whereas guerrilla or grassroots marketing involves unconventional and often low-budget tactics to engage with customers on a personal level.

Question 19

Companies with multiple products or businesses typically choose one marketing strategy for all their different businesses or products.

Accepted Answer

Companies may choose different marketing strategies for different products or businesses depending on their target audience, competition, and other factors.

Question 20

Market niching is profitable because the company ________.

Accepted Answer

Market niching allows companies to focus on a specific target customer segment and understand their unique needs and preferences. This knowledge gives them an advantage over other firms who attempt to sell to the same segment casually. By meeting the specific needs of a narrow market, these companies can establish themselves as experts and build a loyal customer base, leading to profitability.

Quiz 18: Creating Competitive Advantage