Partnering to Build Customer Relationships

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Chapter 2

Company and Marketing Strategy:

Partnering to Build Customer Relationships

GENERAL CONTENT: Multiple-Choice Questions

1. _____ is the task of developing and maintaining an overall company strategy for long-run survival and growth.
2. Strategic planning
3. Annual market planning
4. Short-term planning
5. Long-range planning
6. Advertising

(a; p. 37;Moderate) {AACSB: Communication}

1. _____ involves adapting a firm to take advantage of opportunities in its constant changing environment.
2. Long-range planning
3. Short-range planning
4. Annual planning
5. Strategic planning
6. Environmental scanning

(d; p. 37;Moderate) {AACSB: Communication}

1. Starbucks has an annual plan in place to deal with the company’s current SBUs and their operations. However, as a growth-oriented firm, Starbucks is interested in both domestic and international markets. This requires Starbucks to constantly monitor the environment and adapt to the opportunities with which it is presented. To take advantage of its constantly changing environment, Starbucks needs a ______in place.
2. value-delivery network
3. mission statement
4. supporting objectives
5. profit analysis
6. strategic plan

(e; p. 37; Moderate) {AACSB: Reflective Thinking}

1. The first step in strategic planning is to ______.
2. set objectives and goals
3. develop the business portfolio
4. define the company mission
5. plan marketing strategies
6. identify a problem

(c; p. 37; Easy) {AACSB: Communication}

1. Which of the following is not a step in the strategic planning process?
2. defining the company mission
3. setting company objectives and goals
4. designing the business portfolio
5. planning marketing and other functional strategies
6. collaborating with suppliers on multiple fronts choice is extreme

(e; p. 37; Moderate) {AACSB: Communication}

1. The management of an organization should reexamine the organization’s mission statement ______.

1. annually
2. when the organization is drifting
3. when the organization is succeeding
4. when the market environment shifts
5. after analyzing the organization’s business portfolio

(b; p. 37; Moderate) {AACSB: Analytic Thinking}

1. Which of the following provides an answer to these questions: What is our business? Who are our customers? What do our customers value? What should our business be?
2. objectives and goals
3. mission statement
4. business portfolio
5. marketing and functional strategies
6. operational strategies

(b; p. 37; Moderate) {AACSB: Communication}

1. A vendor for Ford Motor Company received the following message from one of Ford’s marketing managers: “As we move forward during the 21st century, it is incumbent upon us to inform you that Ford is committed to building profitable customer relationships by creating environmentally better cars and getting them to market faster at lower costs.” The marketing manager is referring to Ford’s ______.
2. marketing strategy
3. market tactics
4. business portfolio
5. mission statement
6. business objectives

(d; p. 37; Moderate) {AACSB: Reflective Thinking}

1. _____ should be market oriented and defined in terms of ______.
2. Strategic plans; company needs
3. Annual plans; product needs
4. Long-range plans; company needs
5. Mission statements; customer needs
6. Objectives; customer needs

(d; p. 38; Moderate) {AACSB: Communication}

1. A ______defines a business in terms of satisfying basic customer needs.
2. market-oriented mission statement
3. product-oriented mission statement
4. technology-oriented mission statement
5. environment-oriented mission statement
6. strategic plan

(a; p. 38; Moderate) {AACSB: Communication}

1. When the makers of a ballpoint pen state they are in the communication equipment business, they are defining their mission too ______.
2. narrowly
3. realistically
4. specifically
5. broadly
6. early

(d; p. 38; Easy) {AACSB: Reflective Thinking}

1. All of the following are accurate guidelines for a company’s mission statement except which one?
2. A mission statement should be realistic.
3. A mission statement should be narrow.
4. A mission statement should fit the market environment.
5. A mission statement should be specific.
6. A mission statement should motivate employees.

(b; p. 38; Moderate) {AACSB: Communication}

1. Which of the following is not a market-oriented business definition?
2. “to provide a global trading platform where practically anyone can trade practically anything”
3. “to sell tools and home repair and improvement items”
4. “to deliver low prices every day”
5. “to be the guardian of our customers’ financial dreams”
6. “to bring inspiration and innovation to every athlete in the world”

(b; p. 38; Moderate) {AACSB: Reflective Thinking}

1. Which of the following is not an example of a market-oriented mission statement?
2. “We make the Internet buying experience fast, easy, and enjoyable.”
3. “We create customer connectivity anytime, anywhere.”
4. “We create fantasies.”
5. “We hold online auctions.”
6. “We empower customers to achieve the homes of our dreams.”

(d; p. 38; Moderate) {AACSB: Reflective Thinking}

1. All of the following are examples of product-oriented mission statements, except which one?
2. “At America Online, we provide online services.”
3. “In Disney, we run theme parks.”
4. “At Nike, we sell shoes.”
5. “At Revlon, we sell lifestyle and self-expression; success and status; memories, hopes, and dreams.”
6. “At Ritz-Carlton Hotels, we rent rooms.”

(d; p. 38; Moderate) {AACSB: Reflective Thinking}

1. The current mission statement of the Girl Scouts of America reads “where girls grow strong.” The organization’s former mission statement had read “to prepare young girls for motherhood and wifely duties.” This change reflects the guideline that mission statements should ______.
2. be realistic
3. be motivating
4. be narrow
5. fit the market environment
6. be specific

(d; p. 38; Moderate) {AACSB: Reflective Thinking}

1. Revlon has clearly defined its “mission” of selling lifestyle and self-expression. In order for the firm to launch its strategic plan, the mission needs to be turned into detailed ______that guide each level of the company.
2. sets of strategies
3. sets of tactics
4. sets of product mixes
5. supporting objectives
6. sets of promotional tools

(d; p. 39; Moderate) {AACSB: Reflective Thinking}

1. The collection of businesses and products that make up a company is called its ______.
2. strategic business unit
3. mission statement
4. strategic plan
5. business portfolio
6. operational factors

(d; p. 39; Easy)

1. _____ can be a company division, a product line within a division, or sometimes a single product or brand.
2. A market
3. The BCG
4. An SBU
5. A PLC
6. A value delivery network

(c; p. 40; Moderate)

1. After management has identified the key businesses making up its company, what is the next step?
2. identify businesses in which to invest
3. assess the attractiveness of its SBUs
4. decide whether to harvest any businesses
5. complete short-range planning
6. SBU identification

(b; p. 40; Moderate)

1. The best known product portfolio planning method was developed by ______.
2. Philip Kotler
3. HarvardUniversity
4. the SRI Consulting Firm
5. the Boston Consulting Group
6. James P. Hess

(d; p. 40; Easy)

1. Most portfolio analysis methods evaluate SBUs on two dimensions, namely ______and ______.
2. market share; strength of the SBU’s position
3. market or industry growth rate; relative market share
4. market or industry attractiveness; strength of the SBU’s position
5. market growth rate; profits
6. market penetration; market development

(c; p. 40; Moderate)

1. In the Boston Consulting Group approach, ______provide(s) a measure of market attractiveness.
2. relative market share
3. SBUs
4. cash cows
5. market growth rate
6. dogs

(d; p. 40; Moderate)

1. In the Boston Consulting Group approach, _____ serve(s) as a measure of company strength in the market.
2. relative market share
3. SBUs
4. cash cows
5. market growth rate
6. market segmentation

(a; p. 40; Moderate)

1. The BCG growth-share matrix classifies four types off SBUs. They are ______, ______, ______, and ______.
2. product; price; promotion; placement
3. sales; market share; price; promotion
4. stars; cash cows; question marks; dogs
5. planning; organizing; leading; controlling
6. market penetration; market development; product development; diversification

(c; p. 40; Moderate)

1. In the BCG approach, ______are high-share, high-growth businesses or products. They need heavy investment to finance rapid growth. When their growth slows down, they turn into ______.
2. cash cows; stars
3. question marks; dogs
4. stars; question marks
5. stars; cash cows
6. dogs; cash cows

(d; p. 40; Moderate)

1. _____ are low-growth, high share businesses or products. They generate a lot of cash that the firm uses to pay its bills and support other SBUs that need investment.
2. Stars
3. Cash cows
4. Question marks
5. Dogs
6. Cats

(b; p. 40; Moderate)

1. Management must think hard about which ______it should try to build into stars, and which should be phased out.
2. stars
3. dogs
4. question marks
5. cash cows
6. cats

(c; p. 40; Moderate)

1. In the BCG matrix, income from ______can be used to help finance the company’s question marks and stars.
2. dogs
3. SBUs
4. cash cows
5. sales revenue
6. overseas operations

(c; p. 41; Moderate)

1. The four possible strategies that can be pursued for each SBU are building, holding, ______, and ______.

1. harvesting; divesting
2. promoting; selling
3. downsizing; expanding
4. diversifying; penetrating
5. developing; growing

(a; p. 41; Moderate)

1. Which of the following does notaccurately reflect a problem with the BCG matrix approach?
2. It focuses on future planning.
3. It can be costly to conduct.
4. It can be time consuming to implement.
5. It is difficult to define SBUs and measure market share and growth.
6. It focuses on classifying current businesses.

(a; p. 41; Moderate) {AACSB: Reflective Thinking}

1. Unlike strategic-planning efforts of the past, which were conducted primarily by senior managers, today’s strategic planning is ______.
2. short-term oriented
3. decentralized
4. limitation-free
5. product oriented
6. centralized

(b; p. 41; Moderate) {AACSB: Communication}

1. To increase its U.S. market share, Starbucks has stepped up efforts in the areas of product availability and promotion. These are examples of broad _____.
2. objectives
3. strategies for growth
4. goals
5. diversification
6. product development

(b; p. 42; Moderate) {AACSB: Reflective Thinking}

1. Which department in a company carries the primary responsibility for achieving profitable growth?

1. marketing
2. finance
3. operations
4. human resources
5. management

(a; p. 42; Easy)

1. Which of the following is a useful tool for identifying growth opportunities?

1. the BCG matrix
2. the business portfolio
3. the product/market expansion grid
4. the value chain
5. the value delivery network

(c; p. 42; Moderate)

1. Making more sales to current customers without changing a firm’s products is ______.
2. market development
3. market growth
4. market penetration
5. product development
6. market attractiveness

(c; p. 42; Moderate)

1. Starbucks has introduced a debit card that lets customers prepay for coffee and snacks. This effort by Starbucks management is an example of ______.
2. market development
3. product development
4. diversification
5. market penetration
6. product adaptation

(d; p. 44; Moderate) {AACSB: Reflective Thinking}

1. Wal-Mart, the world’s largest retailer, has successfully launched its stores in Mexico, Canada, the U.K., and Germany, and other nations. This is an example of how Wal-Mart is pursuing ______as a growth strategy.
2. market penetration
3. product development
4. demographic market development
5. geographical market development
6. diversification

(d; p. 44; Moderate) {AACSB: Reflective Thinking}

1. In 1999, Starbucks purchased Hear Music and began making compilation music CDs to play and sell in its stores. It has also tested new restaurant concepts, such as Circadia in San Francisco. Starbucks is implementing ______.
2. new product development
3. market development
4. diversification
5. market penetration
6. product adaptation

(c; p. 44; Moderate) {AACSB: Reflective Thinking}

1. _____ entails reducing the business portfolio by eliminating products that no longer fit the company’s overall strategy.
2. Market segmentation
3. BCG
4. Product line extension
5. Downsizing
6. Market redesign

(d; p. 44; Moderate)

1. Which of the following is not a reason that a firm might want to abandon products or markets?
2. The market environment has changed making some of the products less profitable.
3. The firm has entered areas in which it does not have expertise.
4. The economic climate is showing signs of recovery.
5. The firm has grown too fast.
6. The firm has not properly researched foreign markets which it has entered.

(c; p. 44; Moderate) {AACSB: Analytic Thinking}

1. Each department in a company that carries out value-creating activities can be thought of as a link in the company’s ______.

1. market development
2. product development
3. business portfolio
4. value chain
5. value delivery network

(d; p. 45;Easy)

1. Multinationals like Honda Motor Co. and Wal-Mart stores have designed programs to work closely with their suppliers to help them reduce their costs and improve quality. This illustrates the importance of an efficient _____.
2. business model
3. low-cost operator
4. product mix
5. value-delivery network
6. problem-solver

(d; p. 46; Moderate) {AACSB: Reflective Thinking}

1. _____ is the marketing logic by which a company hopes to achieve profitable customer relationships.
2. Price
3. Being a low-cost operator
4. A consistent product mix
5. Marketing strategy
6. Implementing a differentiation strategy

(d; p. 47; Easy) {AACSB: Communication}

1. Lucy Ortiz has just prepared a PowerPoint presentation of the marketing process to show at a sales meeting. If you look closely, you will see that ______appear in the center.
2. sales goals
3. customer relationships
4. company objectives
5. customer retention rates
6. competitors

(b; p. 48; Moderate) {AACSB: Communication}

1. A sound marketing strategy begins with ______.

1. positioning
2. customer analysis
3. differentiation
4. promotion
5. SWOT analysis

(b; p. 48; Moderate){AACSB: Communication}

1. The process of customer-driven marketing involves ______, ______, ______, and ______.
2. product; price; promotion; adaptation
3. market segmentation; target marketing; differentiation; positioning
4. marketing analysis; planning; implementation; feedback
5. analysis; targeting; implementation; control
6. problem identification; information search; decision; implementation

(b; p. 48; Moderate) {AACSB: Communication}

1. The process of dividing a market into distinct groups of buyers with different needs, characteristics, or behaviors is called ______.
2. target marketing
3. positioning
4. marketing strategy
5. market segmentation
6. market extension

(d; p. 48; Easy) {AACSB: Communication}

1. For Hyundai Corporation, customers who care about the price of a car and its operating economy make up one______.
2. market position
3. value network
4. market segment
5. customer extension
6. value chain

(c; p. 48; Moderate) {AACSB: Reflective Thinking}

1. _____ involves evaluating each market segment’s attractiveness and selecting one or more segments to enter.
2. Market segmentation
3. Product differentiation
4. Market targeting
5. Market mix
6. Positioning

(c; p. 48; Easy)

1. Most companies today enter a new market by serving a ______, and if this proves successful, they ______.
2. single market segment; add segments
3. multitude of segments; add more segments
4. few segments; add more segments
5. niche; differentiate
6. target market; reposition

(a; p. 49; Moderate)

1. _____ is the place a product occupies in the consumer’s mind relative to competition.
2. Product placement
3. Product position
4. Market segmentation
5. Market targeting
6. Product promotion

(b; p. 49; Easy) {AACSB: Communication}

1. Saturn is “a different kind of company, different kind of a car”; the Hummer is “like nothing else.” These statements reflect a firm’s ______.
2. product portfolio
3. target markets
4. market positioning
5. strategy
6. market niche

(c; p. 49; Moderate) {AACSB: Reflective Thinking}

1. Effective positioning begins with ______the company’s marketing offer in order to give consumers more perceived value.
2. pricing
3. aligning
4. differentiating
5. promoting
6. placing

(c; p. 51; Moderate) {AACSB: Communication}

1. In the four Ps of the marketing mix, design, packaging, services, and variety all fall under the category of ______.

1. product
2. price
3. promotion
4. place
5. position

(a; p. 51; Moderate){AACSB: Communication}

1. The text suggests that instead of thinking of selling products, marketers would be wise to take the customer’s view and think of ______.

1. providing convenience
2. offering solutions to problems
3. initiating two-way communication
4. offering discounts
5. connecting services and products

(b; p. 52; Moderate) {AACSB: Analytic Thinking}

1. In the marketing management functions, an SWOT analysis should ______a marketing plan.

1. precede
2. coincide with
3. follow
4. evaluate
5. take priority over

(a; p. 52; Moderate)

1. In SWOT analysis, which of the following would be considered a strength?

1. internal limitations
2. trends in the market
3. favorable factors in the environment
4. factors that challenge the company’s performance
5. internal resources

(e; p. 52; Moderate)

1. In SWOT analysis, which of the following refers to factors in the external environment?

1. strengths
2. strategies
3. weaknesses
4. opportunities
5. trends

(d; p. 53; Moderate) {AACSB: Communication}

1. To be successful at marketing, companies must be effective at marketing planning and then ______.
2. marketing analysis
3. marketing implementation
4. marketing control
5. marketing audits
6. marketing budgeting

(b; p. 54; Moderate)

1. Which of the following is not essential for the successful implementation of a company’s marketing strategies?

1. alignment of marketing strategies with the company’s culture
2. employees with the necessary skills and motivation
3. a reward system that supports marketing strategies
4. a functional organization of the company’s departments
5. a decision-making system that supports marketing strategies

(d; p. 55; Moderate) {AACSB: Analytic Thinking}

1. Under the ______organizational format of marketing departments, different marketing activities are headed by a specialist such as a sales manager, advertising manager, marketing research manager, or customer-service manager.
2. geographic
3. product management
4. market management
5. customer-centered
6. functional

(e; p. 55; Moderate)

1. Modern marketing departments are arranged into the following ways, except which one?
2. functional organization
3. market management organization
4. product management organization
5. geographic organization
6. strategic management organization

(e; p. 55; Moderate)

1. The ______organizational format was first used by Procter and Gamble in 1929.
2. functional
3. market management
4. geographic
5. product management
6. customer management

(d; p. 56; Moderate)

1. The ______organizational system’s main advantage is that the company is organized around the needs of specific market segments.
2. product management
3. market management
4. geographic management
5. vertical management
6. functional management

(b; p. 56;Moderate) {AACSB: Communication}

1. An increasingly large number of firms are changing their organizational focus from ______to ______.
2. product management; functional management
3. product management; territory management
4. brand management; customer relationship management
5. territory management; functional management
6. global management; regional management

(c; p. 56; Moderate) {AACSB: Communication}

1. Evaluating the results of marketing strategies and plans and taking corrective action to ensure that objectives are attained is called ______.
2. marketing control
3. strategic control
4. operating control
5. developmental control
6. efficiency

(a; p. 56; Easy)

1. As Starbucks continues to grow, it is faced with myriad challenges and surprises during the implementation of marketing plans. Hence, the marketing department must practice constant ______.
2. customer management
3. corrective action
4. performance measurement
5. marketing control
6. environmental scanning

(d; p. 56; Easy) {AACSB: Reflective Thinking}

1. The marketing control process entails the following steps in order: setting goals, ______, evaluating performance, and ______.
2. evaluating goals; measuring performance
3. achieving goals; measuring performance
4. taking corrective action; measuring performance
5. measuring performance; taking corrective action
6. taking corrective action; follow-up

(d; p. 56; Moderate)

1. Which of the following is not a step in the marketing control process?
2. setting goals
3. measuring performance
4. taking corrective action
5. defining the mission
6. evaluating the causes of gaps between expected and actual performance

(d; p. 56; Moderate)

1. Ensuring that the company achieves the sales, profits, and other goals set out in its annual marketing plan is the purpose of ______.
2. marketing control
3. operating control
4. strategic control
5. anticipatory control
6. a marketing audit

(b; p. 56; Moderate)