Marketing Chapter 2 MC – Flashcards
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1. The process of anticipating future events and conditions and determining the best way to achieve organizational objectives is known as: a. retrospecting. b. planning. c. archiving. d. correlating.
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b. planning.
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2. Product lines, pricing decisions, selection of appropriate distribution channels, and decisions relating to promotional campaigns are____. a. fixed and unchanging b. independent of the impact of external factors c. dynamic in today's boundaryless business environment d. determined from a purely retrospective viewpoint
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c. dynamic in today's boundaryless business environment
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3. Marketing planning establishes the: a. resource base provided by the firm's strategy. b. economic impact of additional sales. c. daily and weekly schedules for individual employees. d. basis for any marketing strategy.
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d. basis for any marketing strategy.
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4. Relationship marketing can help a company: a. create long-term and cost-effective links with individual customers and suppliers for mutual benefit. b. reduce its strategic planning effort since the need for such planning is greatly diminished by relationship marketing. c. locate more effective media for use in advertising and mass marketing. d. eliminate the strategic planning process and move into tactical plans directly.
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a. create long-term and cost-effective links with individual customers and suppliers for mutual benefit.
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5. Effective relationship marketing often involves: a. inside information about competitors that is not in the public domain. b. databases to track customer preferences. c. large advertising budgets aimed solely at end-users. d. internal sources of performance-related data.
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b. databases to track customer preferences.
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6. Relationship marketing refers to a firm's effort to develop long-term, cost-effective links with individual customers and suppliers. Many companies: a. have been reluctant to adopt such initiatives because there is no evidence of their effectiveness. b. focus on relationship marketing as the sole purpose of their marketing research efforts. c. include relationship-building goals and strategies in their larger plans for the organization. d. believe that relationship marketing is just a fad and may not be sustainable or profitable in the long run.
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c. include relationship-building goals and strategies in their larger plans for the organization.
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7. Long-term plans focusing on those organizational objectives that will significantly affect a firm for five or more years are usually referred to as _____ plans. a. strategic b. marketing c. economic d. tactical
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a. strategic
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8. ADA Inc. stopped its production of oral care goods after determining apparel production to be its new primary objective. This is a direct result of the _____ planning process at ADA Inc. a. tactical b. research c. strategic d. economic
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c. strategic
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9. Strategic planning has a critical impact on a firm's destiny because it provides _____ to its decision makers. a. customer input b. individual goals c. departmental goals d. long-term direction
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d. long-term direction
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10. If an automobile manufacturer was planning to introduce a sports car powered by a hydrogen-oxygen fuel cell when the price of gasoline in the United States reached $4 per gallon, this would best be described as a direct result of its _____ plan. a. short-term b. operational c. strategic d. tactical
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c. strategic
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11. The U.S. Sports and Fitness Federation is determining where they should build their permanent training facility. They want it to be located near a populated center but it must also provide ample access to those who don't reside in cities. The federation is engaged in _____ planning. a. strategic b. short-term c. operational d. economic
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a. strategic
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12. An event management company decided to use radio advertising in order to promote an upcoming music festival. The executives of the company suggested various activities that could be used for the radio campaign. These activities are a part of the company's _____. a. tactical planning efforts b. standard operating procedures c. weekly scheduling plans d. unit-wise budgeting plans
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a. tactical planning efforts
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13. A company's plans that focus largely on its current and near-future activities and are determined by its middle level management are referred to as _____ plans. a. strategic b. long-term c. operational d. tactical
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d. tactical
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14. Preparation of quarterly and semiannual plans by personnel such as the general sales manager or advertising director would be classified as _____ planning. a. consumer b. tactical c. procedural d. operational
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b. tactical
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15. Compared to other organization personnel, more time is devoted to long-range strategic planning by the: a. middle management. b. manufacturing labor. c. top management. d. supervisory management.
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c. top management.
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16. In the planning hierarchy, plans dealing with organization-wide objectives, long-term plans, and the total budget would be classified as _____ plans. a. weekly b. tactical c. operational d. strategic
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d. strategic
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17. Employees of Popsie Inc., a small grocery store chain, are working on its tactical plans. The personnel most involved in this level of its planning process would be its: a. top management, such as the owner. b. middle management, such as the merchandising and advertising managers. c. store managers. d. supervisory management, such as shift managers and night auditors.
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b. middle management, such as the merchandising and advertising managers.
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18. Operational planning: a. should be used to establish the fundamental strategies of the organization. b. is used to determine departmental rules and procedures. c. is the primary responsibility of the top management. d. should be completed at the same time the total budget is prepared.
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b. is used to determine departmental rules and procedures.
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19. Which of the following statements is true of tactical planning? a. It is conducted exclusively by the supervisory personnel. b. It is used to generate weekly plans, unit budgets, departmental rules and procedures. c. It is designed to determine annual budgets and long-range strategic goals. d. It is performed to substitute the strategic planning process in large organizations.
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c. It is designed to determine annual budgets and long-range strategic goals.
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20. General Electric's NBC division acquired Universal Studios and the highest executive who approved this acquisition was most likely GE's CEO. This decision is the direct result of _____ planning process at GE. a. tactical b. strategic c. operational d. technological
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b. strategic
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21. The first step of the marketing planning process involves: a. writing the mission statement. b. establishing organizational objectives. c. formulating a marketing plan. d. hiring a senior planner.
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a. writing the mission statement.
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22. Which of the following best represents a mission statement? a. U.S. Army: Be all that you can be b. Bass Pro Shop: To be the leading merchant of outdoor recreational products, inspiring people to love, enjoy, and conserve the great outdoors c. Kellogg's: Breakfast cereals at a price everyone can afford d. Walmart: Stores big enough to make shopping interesting for every family member
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b. Bass Pro Shop: To be the leading merchant of outdoor recreational products, inspiring people to love, enjoy, and conserve the great outdoors
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23. Which of the following defines an organization's mission? a. Process of anticipating future events and conditions b. Companywide program for scaling down the product-lines that are low on profitability c. Essential purpose that differentiates one company from others d. Collection of limited periods during which key requirements of a market and a firm's particular competencies best fit together
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c. Essential purpose that differentiates one company from others
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24. A company can modify a strategy when its actual performance is not in line with expected results by: a. redefining the firm's mission. b. focusing exclusively on long-range strategic issues. c. putting the marketing strategy into action and monitoring performance. d. interpreting the mission, vision, and values of the company differently.
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c. putting the marketing strategy into action and monitoring performance.
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25. The basic objectives or goals of an organization are derived from its: a. standard operating procedures. b. operational plans. c. supervisory management strategy. d. mission statement.
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d. mission statement.
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26. The _____ is the organizational program for selecting a target market and satisfying customers in that market through the marketing mix. a. operational plan b. marketing strategy c. relationship marketing approach d. short-term plan
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b. marketing strategy
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27. All planning strategies have the goal of creating: a. sustainable competitive advantage. b. undifferentiated markets. c. a market with no distinct segments. d. barriers to market entry.
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a. sustainable competitive advantage.
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28. Business strategist Michael E. Porter identified five competitive forces that influence _____ in a model called Porter's Five Forces. a. planning strategies b. corporate social responsibility c. consumer behavior d. sustainable development
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a. planning strategies
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29. Which of the following is a dimension of Porter's Five Forces model? a. Bargaining power of buyers b. Existence of second-movers c. Existing firms in the business environment d. Rivalry among strategic business units
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a. Bargaining power of buyers
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30. Promotional schemes like frequent shopper programs provide incentives to loyal buyers. Considering Porter's Five Forces model, such offers will: a. reduce the threat of new entrants. b. decrease the rivalry among competitors. c. decrease the bargaining power of the supplier. d. increase the threat of substitute products.
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a. reduce the threat of new entrants.
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31. Business strategies are impacted by the widespread use of the Internet. Which of the following is true with respect to its impact? a. The Internet has eliminated all forms of substitution threats. b. The Internet has reduced barriers to market entry. c. The Internet has reduced the bargaining power of end-users. d. The Internet has reduced consumer awareness about the differences among competitors.
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b. The Internet has reduced barriers to market entry.
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32. An automobile manufacturer is dependent on a single supplier for tires. Based on this information, which of the following statements is true? a. The barriers to market entry are low. b. The buyer has greater bargaining power. c. The threat of new entrants is high. d. The supplier has significant bargaining power.
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d. The supplier has significant bargaining power.
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33. A shoe manufacturer has multiple suppliers for leather. Based on this information, which of the following statements is true? a. The suppliers have lesser bargaining than the buyer. b. The barriers to market entry are high. c. The rivalry among competitors is low. d. The buyer has lesser bargaining power than the suppliers.
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a. The suppliers have lesser bargaining than the buyer.
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34. Which of the following conditions would lead a company's marketers to find a new market, change prices, or compete in other ways to maintain an advantage? a. When the bargaining power of suppliers is low b. When the bargaining power of buyers is low c. When the threat of substitute products is high d. When the threat of new entrants it low
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c. When the threat of substitute products is high
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35. In addition to the four forces of the Five Forces Model, which of the following influences rivalry among competitors? a. Decreased availability of information of competitors b. Decreased consumption during a lull in the economy c. Lack of differentiation between products d. Lack of major differences in pricing strategies
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c. Lack of differentiation between products
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36. Bell Weddings was the company that pioneered the wedding planning industry. The owners realized that customizing weddings to the wishes of the families, taking charge of the responsibilities, and creating a day that is memorable for clients was an incredible business venture. The case of Bell Weddings illustrates the value of _____. a. organizational vulnerabilities b. the first mover strategy c. operating plans d. portfolio analysis
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b. the first mover strategy
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37. Which of the following statements is indicative of a second mover strategy? a. Entering new markets with existing products b. Making significant innovations that turn old products into new ones c. Observing closely the innovations of first movers and then improving on them d. Entering new markets with new products before any other entrants
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c. Observing closely the innovations of first movers and then improving on them
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38. Atari, a consumer electronics and video games company, observed the innovations of Nintendo Co., the most powerful video game company at that time, and destroyed the market share of Nintendo eventually. This implies that Atari: a. followed a first-mover strategy. b. created a new product indigenously. c. remained uninfluenced by Nintendo. d. applied a second-mover strategy.
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d. applied a second-mover strategy.
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39. Core competencies are capabilities that customers value and competitors: a. can easily copy. b. tend to overestimate. c. find difficult to duplicate. d. undervalue.
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c. find difficult to duplicate.
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40. A certain social networking corporation has the highest number of users in the social networking industry. This is an example of the firm's: a. opportunity. b. constraint. c. strength. d. threat.
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c. strength.
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41. A SWOT analysis is designed to reveal, among other things, a firm's core competencies, which reflect its: a. threats. b. strengths. c. opportunities. d. vulnerabilities.
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b. strengths.
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42. Matching an internal strength with an external opportunity produces a situation known as: a. leverage. b. constraint. c. vulnerability. d. plateau.
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a. leverage.
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43. An example of a firm's strength discovered by a SWOT analysis might be: a. ownership of valuable patents. b. a narrow current product line. c. changing buyer tastes in the marketplace. d. existing government policies favoring the industry.
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a. ownership of valuable patents.
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44. In SWOT analysis, situations where organizations are unable to capitalize on opportunities because of internal limitations are referred to as: a. strategic windows. b. threats. c. constraints. d. leverages.
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c. constraints.
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45. Which of the following would qualify as an example of a firm's weakness? a. A bill passed by the government regarding the work timings of all organizations b. A competitor planning to open a new branch close to the firm's place of operations c. The firm's failure to pay its taxes on time leading to a poor reputation in the market d. A ban imposed on the use of animals for testing cosmetics
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c. The firm's failure to pay its taxes on time leading to a poor reputation in the market
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46. DK Motors' difficulty in competing with other car makers due to its lack of responsiveness to changing consumer preferences constitutes a: a. strategic window. b. leveraged situation. c. threat from the environment. d. constraint on its activity.
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d. constraint on its activity.
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47. Assume that a firm would like to expand its product line. A complete expansion would cost $100 million, but the firm can only raise $75 million in financing. This is best classified as a(n): a. constraint. b. opportunity. c. threat. d. instance of leverage.
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a. constraint.
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48. Which of the following would qualify as an example of a firm's weakness? a. Changing buyer tastes in the marketplace b. The presence of modern production facilities c. Inadequate financing capabilities d. An addition to the current product line
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c. Inadequate financing capabilities
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49. An example of a threat to a firm discovered by a SWOT analysis might be: a. the presence of cost advantages due to advanced technology. b. the chance to acquire firms with the needed technology. c. the entry of new competitors in the industry. d. the narrow product line produced by the firm.
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c. the entry of new competitors in the industry.
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50. The limited occasions when the key requirements of a market and the particular competencies of a firm best fit together are referred to as: a. barriers to entry. b. strategic windows. c. question marks. d. threats.
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b. strategic windows.
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51. At a time when computer users were having trouble storing, sending, and displaying photos, Apple introduced the iMac computer, which was equipped with a digital camera interface and photo-handling software. This product was a result of Apple recognizing its: a. economies of scale. b. competitive constraints. c. strategic window. d. second-mover benefits.
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c. strategic window.
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52. When a massive fuel hike affected the expenses of users of Cadmia significantly, Flare Inc. introduced automobiles that run on solar energy. The introduction of such automobiles indicates that Flare Inc.: a. switched over to less sustainable fuels. b. recognized its competitive constraints. c. applied a second-mover advantage. d. made the best of a strategic window.
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d. made the best of a strategic window.
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53. Jose is part of a team that is analyzing current demographic trends. The team will make a recommendation concerning the groups of consumers toward whom the firm should direct its new marketing effort. Jose's team is involved in which of the following elements of the firm's marketing strategy? a. Target market b. Distribution c. Product d. Promotion
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a. Target market
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54. The group of people to whom a firm directs its marketing efforts and ultimately its merchandise is known as its _____ market. a. undifferentiated b. unsegmented c. mass d. target
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d. target
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55. The term marketing mix describes: a. a composite analysis of all environmental factors inside and outside the firm. b. a series of business decisions that aid in selling a product. c. the relationship between a firm's marketing strengths and its business weaknesses. d. a blend of the four strategic marketing elements to satisfy specific target markets.
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d. a blend of the four strategic marketing elements to satisfy specific target markets.
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56. In marketing, the term product: a. refers only to tangible items that can be seen, tasted, or touched. b. refers to a broad concept encompassing the satisfaction of consumer needs. c. limits itself to include goods alone. d. excludes package design, brand name, or warranty from its purview.
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b. refers to a broad concept encompassing the satisfaction of consumer needs.
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57. Jenny has been appointed the marketing manager for Spark Cleaning Products. Her job focuses on decisions involving customer service, package design, brand names, and warranties. In this scenario, Jenny is closely associated with the _____ dimension of the marketing planning. a. product strategy b. resource valuation and pricing c. retailing and distribution d. target market
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a. product strategy
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58. Decisions relating to the product strategy primarily revolve around _____. a. the promotional offers that would increase the visibility of the product in the market b. the features of the products being released in the market c. the choice of high/low or everyday low pricing by the company d. the selection of wholesalers and retailers to transport the stock to the market
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b. the features of the products being released in the market
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59. Decisions involving transportation, warehousing, inventory control, and order processing relate to the _____ strategy component. a. pricing b. competitive c. product d. distribution
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d. distribution
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60. Decisions about distribution strategy primarily involve challenges such as: a. how to advertise the product. b. how to position a product. c. when to raise prices to cover costs. d. which marketing channels to adopt.
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d. which marketing channels to adopt.
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61. Maxwell has been promoted to an upper-level management position at QVC. He will be involved in matters relating to transportation media, order processing, and development of marketing channels. Maxwell is involved in developing _____ strategies for the marketing team. a. product b. distribution c. promotional d. test marketing
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b. distribution
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62. Which of the following best describes the activity of promotion? a. Making new products available to meet consumer demand b. Finding a convenient location to sell the products in c. Maintaining a high level of regulation in production d. Communicating between buyers and sellers
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d. Communicating between buyers and sellers
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63. Newsletters, catalogs, and invitations to company-sponsored events are most closely associated with the marketing mix activity of: a. product pricing. b. product distribution. c. product development. d. product promotion.
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d. product promotion.
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64. Many companies use an approach called _____ to coordinate all promotional activities so that the consumer receives a unified and consistent message. a. intra-organizational communications b. internal marketing strategies c. integrated marketing communications d. corporate communications
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c. integrated marketing communications
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65. The marketing mix decisions which are closely regulated and subject to public scrutiny usually relate to a company's _____ strategy. a. short-term b. resource c. distribution d. pricing
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d. pricing
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66. A bill passed by the government stipulates the mandatory use of revised engine mapping and particulate filters in the automobile industry. Which of the following factors of the marketing environment has affected the automobile industry in this scenario? a. competitive b. political-legal c. economic d. social-cultural
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b. political-legal
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67. The rule of three states that the three leading firms in an industry will control _____ percent of the market. a. less than 25 b. less than 50 c. between 70 and 90 d. 100
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c. between 70 and 90
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68. An international apparel manufacturer changed its pricing strategy as it entered a new market where recessionary trends are being observed. This implies that the _____ factors of the marketing environment led the firm to change its pricing decisions. a. legal b. political c. environmental d. economic
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d. economic
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69. Carmen is a marketer for a global consumer products company. She is designing a promotional campaign for a foreign market and wants to ensure that the promotional campaign is clearly understood by the target consumers. She is also taking special care to see that the campaign is free from controversies and does not inadvertently offend anyone. In this scenario, Carmen is specifically trying to take into account variables of the country's _____ environment. a. social-cultural b. political-legal c. competitive d. economic
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a. social-cultural
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70. As chief executive of Stalwart Shipfitting Company, a diversified producer of marine supplies and equipment, John needs a method for spotting promising product lines that warrant commitment of additional resources, as well as those that should be removed from the firm's product portfolio. A good choice for this firm at this stage would be to use: a. computer models. b. strategic business units. c. a marketing audit. d. an industry analysis.
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b. strategic business units.
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71. The strategic business unit (SBU) concept is best identified as a: a. planning tool that separates tactical and operational issues for analysis. b. strategic approach used primarily to separate marketing costs from production expenses. c. marketing planning tool that best suits the needs of large, diversified organizations. d. marketing approach appropriate for small enterprises producing a single product.
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c. marketing planning tool that best suits the needs of large, diversified organizations.
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72. Which of the following is true of a strategic business unit? a. A strategic unit directly adopts the mission of its parent organization. b. Each strategic unit depends on plans of the other units in the organization. c. A strategic unit has its own managers, resources, objectives, and competitors. d. A strategic unit is a key business unit within a small company that does not differ significantly from the parent company.
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c. A strategic unit has its own managers, resources, objectives, and competitors.
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73. In a(n) _____, firms evaluate their products and divisions to determine the strongest and weakest. a. organizational appraisal b. market analysis c. utilization analysis d. portfolio analysis
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d. portfolio analysis
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74. The performance framework developed by the Boston Consulting Group (BCG) plots: a. market share against market growth potential. b. market attractiveness against number of product lines. c. current market conditions against past trends. d. performance in test markets before a full-scale rollout.
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a. market share against market growth potential.
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75. The quadrant of the BCG market share/market growth matrix that represents both a high market share and a high rate of market growth represents the: a. cash cows. b. innovators. c. stars. d. strivers.
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c. stars.
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76. Microsoft Windows generates considerable income for its parent company but is expensive to support. However, the expense is acceptable because Windows is the world's dominant operating system. Based on this information, Windows would be categorized under the BCG market share/market growth matrix as a: a. star. b. cash cow. c. question mark. d. dog.
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a. star.
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77. According to the BCG market share/market growth matrix, the SBU that produces strong cash flows which can be used to finance the growth of other SBUs is the: a. dog. b. question mark. c. cash cow. d. laggard.
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c. cash cow.
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78. According to the BCG market share/market growth matrix, the revenues earned from cash cows should be used to finance the growth of: a. question marks and dogs. b. dogs and stars. c. stars and question marks. d. question marks and cash cows.
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c. stars and question marks.
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79. One of General Electric's business units produces a variety of light bulbs and generates healthy revenue. The revenues of this business unit are used to finance the growth of other business units with higher growth potentials. How would this unit be classified on the BCG market share/market growth matrix? a. Cash cow b. Star c. Question mark d. Dog
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a. Cash cow
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80. The BCG market share/market growth matrix classifies products with a low relative share of a high-growth market as _____. a. stars b. question marks c. cash cows d. dogs
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b. question marks
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81. In terms of the BCG Matrix, which of the following SBUs are characterized by earning only low market shares in low-growth markets? a. Stars b. Question marks c. Dogs d. Cash cows
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c. Dogs
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82. YOU Inc., a radio cassette manufacturer, sold its business due to poor market shares. According to the BCG Matrix, the firm sold its business because the business had become a _____ as seen in its poor prospects and performance. a. star b. question mark c. cash cow d. dog
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d. dog
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83. According to the BCG market share/market growth matrix, _____ typically require more cash than they generate. a. cash cows b. stars c. question marks d. achievers
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c. question marks
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84. The product manager for a line of mousetraps informs the board of directors at the company's annual meeting that the product has been classified as a 'dog' according to the BCG market share/market growth matrix. This means the product: a. requires a "go/no go" decision within the next several years. b. has low market share of a high-growth rate market. c. should be withdrawn from the market or sold off as quickly as possible. d. needs heavy investment to make it a star.
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c. should be withdrawn from the market or sold off as quickly as possible.
