Chapter 2 : Developing Marketing Strategies & Plans
1. A key ingredient of the marketing management process is insightful, ________ marketing strategies and plans that can guide marketing activities.
a. creative
b. measurable
c. macro
d. micro
e. niche
Answer: a
2. According to a chapter story about H&M clothing stores, H&M is able to put products out quickly and inexpensively by all of the following EXCEPT ________.
a. having few middlemen and owning no factories
b. buying large volumes
c. having extensive experience in the clothing industry
d. having a great knowledge of which goods should be bought from which markets
e. having total control of its distribution channel from the time the goods are produced until the time they are sold
Answer: e
3. The task of any business is to deliver ________ at a profit.
a. customer needs
b. products
c. customer value
d. products and services
e. improved quality
Answer: c
4. In a hyper competitive economy such as ours, a company can win only by fine-tuning the value delivery process and choosing, providing, and ________ superior value.
a. communicating
b. selecting target markets with
c. composing
d. developing
e. researching
Answer: a
5. The traditional view of marketing is that the firm makes something and then ________ it.
a. markets
b. sells
c. distributes
d. prices
e. services
Answer: b
6. Today, the “mass-market” is actually splintering into numerous ________, each with its own wants, perceptions, preferences, and buying criteria.
a. micro markets
b. market targets
c. macro markets
d. customer cliques
e. demographic units
Answer: a
7. The first phase of the value creation and delivery sequence is ________ that represents the “homework” marketing must do before any product exists.
a. choosing the value
b. market research
c. target marketing
d. service consideration
e. projective thinking
Answer: a
8. The last step in the value creation and delivery sequence is ________ the value where the sales force, sales promotion, advertising, and other communication tools announce and promote the product.
a. developing
b. distributing
c. communicating
d. reversing
e. researching
Answer: c
9. The Japanese have refined the value delivery process to include a component that emphasizes ________.
a. zero servicing
b. zero customer feedback time
c. zero promotion
d. zero dependency on intermediaries
e. zero marketing costs
Answer: b
10. The ________ is a tool for identifying ways to create more customer value.
a. value chain
b. customer survey
c. brand loyalty index
d. promotion channel
e. supplier database
Answer: a
11. The ________ identifies nine strategically relevant activities that create value and cost in a specific business.
a. value proposition
b. value chain
c. mission statement
d. annual report
e. manager’s log
Answer: b
12. The ________ in the value chain cover the sequence of bringing materials into the business (inbound logistics), converting them into final products (operations), shipping out final products (outbound logistics), marketing them (marketing and sales), and servicing them (service).
a. operations process
b. manufacturing process
c. primary activities
d. secondary activities
e. tertiary activities
Answer: c
13. Procurement, technology development, human resource management, and firm infrastructure are handled in certain specialized departments and are called ________.
a. materials handling
b. support activities
c. inventory activities
d. primary activities
e. benchmark activities
Answer: b
14. The firm should estimate its competitors’ costs and performances as ________ against which to compare its own costs and performance.
a. competition
b. standards
c. challenges
d. benchmarks
e. moveable standards
Answer: d
15. The firm’s success depends not only on how well each department performs its work, but also on how well the various departmental activities are coordinated to conduct ________.
a. core strategies
b. satellite businesses
c. core values
d. core business processes
e. core technologies
Answer: d
16. With respect to core business processes, all the activities involved in gathering market intelligence, disseminating it within the organization, and acting on the information is referred to as the ________.
a. market sensing process
b. market research process
c. target marketing process
d. market pulse process
e. deployment process
Answer: a
17. With respect to the core business processes, all the activities involved in researching, developing, and launching new high-quality offerings quickly and within budget are referred to as the ________.
a. new product process
b. new offering realization process
c. product development process
d. product launch process
e. return on investment process
Answer: b
18. With respect to the core business processes, the ________ is considered to be all the activities involved in defining target markets and prospecting for new customers.
a. customer acquisition process
b. customer relationship management process
c. fulfillment management process
d. customer prospecting process
e. customer equity process
Answer: a
19. A good way to describe the ________ would be discuss all the activities involved in building deeper understanding, relationships, and offerings to individual customers.
a. customer acquisition process
b. customer relationship management process
c. customer prospecting process
d. customer fulfillment management process
e. customer equity process
Answer: b
20. Another way to describe a value delivery network (partnering with specific suppliers and distributors) is to call it a ________.
a. teamwork group
b. cabal
c. domestic power center
d. link to relationships
e. supply chain
Answer: e
21. The key to utilizing organizational core competencies is to ________ that make up the essence of the business.
a. make the competencies pay for themselves
b. own all intermediaries who come in contact with your goods and services
c. own and nurture the resources and competencies
d. emphasize global promotions
e. segment workforces
Answer: c
22. We can say that a ________ has three characteristics: (1) It is a source of competitive advantage in that it makes a significant contribution to perceived customer benefits, (2) it has applications in a wide variety of markets, and (3) it is difficult for competitors to imitate.
a. core competency
b. business strategy
c. core technology
d. strategic business unit
e. winning strategy
Answer: a
23. Core competencies tend to refer to areas of special technical and production expertise, where ________ tend to describe excellence in broader business processes.
a. process benchmarks
b. distinctive capabilities
c. core business values
d. value statements
e. mission statements
Answer: b
24. George Day sees market-driven organizations as excelling in three distinctive capabilities: ________, customer linking, and channel bonding.
a. target marketing
b. market research
c. fulfilling customer needs
d. market sensing
e. customer service relationships
Answer: d
25. Competitors find it hard to imitate companies such as Southwest Airlines, Dell, or IKEA because they are unable to copy their ________.
a. product innovations
b. distribution strategy
c. pricing policies
d. activity systems
e. logistics system
Answer: d
26. One conception of holistic marketing views it as “integrating the value exploration, ________, and value delivery activities with the purpose of building long-term, mutually satisfying relationship and co-prosperity among key stakeholders.”
a. value creation
b. value proposition
c. value management
d. value research
e. value chain
Answer: a
27. Holistic marketers achieve profitable growth by expanding customer share, ________, and capturing customer lifetime value.
a. undermining competitive competencies
b. building customer loyalty
c. milking the market for product desires
d. renewing a customer base
e. inspecting all market share data
Answer: b
28. The holistic marketing framework is designed to address three key management questions. Which of the following is one of those questions?
a. Value claims—how does the company deal with value erosion?
b. Value proposition—how can value propositions be made profitable?
c. Value chain—are there weak links in the company’s value chain
d. Value network—how can a company effectively network?
e. Value exploration—how can a company identify new value opportunities?
Answer: e
29. The customer’s ________ reflects existing and latent needs and includes dimensions such as the need for participation, stability, freedom, and change.
a. competence space
b. resource space
c. emotional space
d. relationship space
e. cognitive space
Answer: e
30. The companies ________ can be described in terms of breadth—broad versus focused scope of business; and depth—physical versus knowledge-based capabilities.
a. business mission
b. core strategy
c. cognitive space
d. competency space
e. resource space
Answer: d
31. The collaborator’s ________ involves horizontal partnerships, where companies choose partners based on their ability to exploit related market opportunities, and vertical partnership, where companies choose partners based on their ability to serve their value creation.
a. resource space
b. competency space
c. cognitive space
d. rational space
e. service space
Answer: a
32. Business realignment may be necessary to maximize core competencies. Which of the following would be one of the steps in this realignment process?
a. Reviewing all macro relationships.
b. Reviewing global outreach projections.
c. Redefining the business concept (the “big idea”).
d. Reviewing successes from e-commerce (if any).
e. Revamping the ethics statement.
Answer: c
33. ________ allows the company to discover who its customers are, how they behave, and what they need or want. It also enables the company to respond appropriately, coherently, and quickly to different customer opportunities.
a. Network management
b. Strategic management
c. Marketing management
d. Customer relationship management
e. Total quality management
Answer: d34. To respond effectively and provide value delivery, the company requires ________ to integrate major business processes (e.g., order processing, general ledger, payroll, and production) within a single family of software modules.
a. human resource management
b. internal auditing management
c. internal resource management
d. strategic management
e. marketing management
Answer: c
35. With respect to value delivery, ________ allows the company to handle complex relationships with its trading partners to source, process, and deliver products.
a. a value matrix
b. a global distribution policy
c. a business development strategy
d. business partnership management
e. total quality management
Answer: d
36. Successful marketing requires having capabilities such as understanding ________, creating customer value, delivering customer value, capturing customer value, and sustaining customer value.
a. customer loyalty
b. customer per
c. customer retention
d. customer value
e. customer benefits
Answer: d
37. According to a McKinsey research study, which of the following is one of the main challenges that marketing must face in the twenty-first century?
a. The threat of ethics-based lawsuits.
b. Doing more with less.
c. Hostile takeover attempts.
d. Increasing control by big government.
e. Being independent of the distribution process.
Answer: b
38. Strategic planning in the twenty-first century calls for action in three key areas. Which of these key areas deals specifically with devising a long-term game plan for achieving long-run objectives?
a. Creating a viable business opportunity.
b. Producing a strategic fit.
c. Developing an investment portfolio.
d. Expanding core competencies.
e. Establishing a strategy.
Answer: e
39. Most large companies consist of four organizational levels: the ________, the division level, the business unit level, and the product level.
a. board of director level
b. major stakeholder level
c. management team level
d. corporate level
e. strategic level
Answer: d
40. The ________ is the central instrument for directing and coordinating the marketing effort.
a. strategic plan
b. marketing plan
c. tactical plan
d. customer value statement
e. corporate mission
Answer: b
41. The ________ lays out the target markets and the value proposition that will be offered, based on an analysis of the best market opportunities.
a. organizational plan
b. strategic marketing plan
c. corporate tactical plan
d. corporate mission
e. customer value statement
Answer: b
42. In which of the following plans would we most likely find directions for implementing and addressing daily challenges and opportunities in product features, pro motion, merchandising, pricing, sales channels, and service areas.
a. The tactical marketing plan.
b. The target marketing plan.
c. The deployment plan.
d. The product launch plan.
e. The product development plan.
Answer: a
43. If you wanted to find out more about target markets and the organization’s value proposition, which of the following types of plans would most likely contain information that might be useful to you in your quest?
a. The marketing plan.
b. The organizational plan.
c. The strategic marketing plan.
d. The tactical marketing plan.
e. The marketing mix plan.
Answer: c
44. The ________ process consists of corporate, division, business, and product planning.
a. implementing
b. controlling
c. innovation
d. planning
e. competitive
Answer: d
45. All corporate headquarters undertake four planning activities, the first of which is ________.
a. defining the corporate mission
b. establishing strategic business units and assigning resources (SBUs)
c. assigning resources to each SBU
d. assessing growth opportunities
e. understanding target markets
Answer: a
46. A clear, thoughtful mission statement provides employees with a shared sense of purpose, direction, and ________.
a. profitability
b. target market feasibility
c. opportunity
d. continuous improvement
e. quality products
Answer: c
47. Mission statements are at their best when they reflect a ________.
a. market
b. strength
c. competency
d. vision
e. value
Answer: d
48. Which of the following terms matches to the phrase “it is a single business or collection of related businesses that can be planned separately from the rest of the company”?
a. Strategic business unit.
b. Diverse business unit.
c. Growth business unit.
d. Niche market unit.
e. Specialized business unit.
Answer: a
49. Market-penetration, product-development, and market-development strategies would all be examples of ________ strategies.
a. concentric
b. conglomerate
c. horizontal
d. intensive growth
e. integrative growth
Answer: d
50. A(n) ________ is when a company might seek new businesses that have no relationship to its current technology, products, or markets.
a. concentric strategy
b. conglomerate strategy
c. horizontal strategy
d. intensive growth strategy
e. integrative strategy
Answer: b
51. Which of the following terms most closely matches to “the shared experiences, stories, beliefs, and norms that characterize an organization”?
a. Organizational dynamics.
b. A business mission.
c. An ethical/value statement.
d. Customer relationships.
e. Corporate culture.
Answer: e
52. The first step in the business unit strategic-planning process deals with which of the following?
a. Goal formulation.
b. Business mission.
c. Strategy formulation.
d. Program formulation.
e. SWOT analysis.
Answer: b
53. When a business gets to know market segments intimately and pursues either cost leadership or differentiation within the target segment it is referred to as a ________.
a. defined strategy
b. focused strategy
c. value-added strategy
d. competitive advantage strategy
e. customer-focused strategy
Answer: b
54. If a firm pursues a ________ strategy, it must be good at engineering, purchasing, manufacturing, and physical distribution.
a. differentiation
b. overall cost leadership
c. focus
d. domestic customer relationship
e. market share
Answer: b
55. To keep their strategic alliances thriving, corporations have begun to develop organizational structures to support them and have come to view the ability to form and manage partnerships as core skills. This is called ________.
a. value managed partnership
b. synergistic partnership
c. centralized partnership
d. partner relationship management
e. win-win relationship management
Answer: d
56. Traditionally, most businesses focused on stockholders. Today, the focus is on what are called ________.
a. stakeholders
b. partners
c. regulators
d. consumer triads
e. supply-chain relationships
Answer: a
57. A ________ is a written document that summarizes what the marketer has learned about the marketplace and indicates how the firm plans to reach its marketing objectives.
a. strategic plan
b. marketing plan
c. sales plan
d. target market plan
e. competitive analysis plan
Answer: b
58. Which of the following permits senior management to grasp the marketing plan’s major thrust?
a. The situation analysis.
b. The marketing strategy.
c. The executive summary and table of contents.
d. Financial projections.
e. Implementation and controls.
Answer: c
59. Most marketing plans cover ________.
a. one year
b. two years
c. three years
d. four years
e. five years
Answer: a
60. The most frequently cited shortcomings of current marketing plans, according to marketing executives, are lack of realism, insufficient competitive analysis, and a ________ focus.
a. long-term
b. profit
c. short-run
d. product
e. price
Answer: c
Chapter 3 : Gathering Information and Scanning The Environment