Chapter 2 Flashcards
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What is the primary purpose of a value proposition?
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To increase a company’s profits.
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To communicate the key benefits a product or service offers to target customers.
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To outline a company’s internal resources and capabilities.
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To analyse the external environment.
To communicate the key benefits a product or service offers to target customers.
Which of the following is an internal factor when conducting a SWOT analysis?
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Brand name.
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Bad economy.
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High interest rates.
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Strong competitors.
Brand name.
What does a mission statement primarily define?
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A company’s marketing objectives.
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The purpose of the organisation.
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A firm’s financial goals.
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A business’s competitive strategy.
The purpose of the organisation.
What are objectives?
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The specific actions taken to execute strategies.
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A statement that summarizes the key benefits.
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What organisations want to accomplish in a given time frame.
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The means to achieve a competitive advantage.
What organisations want to accomplish in a given time frame.
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What is a market penetration strategy?
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Entering new markets with existing products.
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Creating new products for existing customers.
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Selling more of existing products to existing customers.
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Offering products unrelated to the organisation’s existing products.
Selling more of existing products to existing customers.
Which international market entry strategy involves the least risk and least expense?
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Direct investment.
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Joint ventures.
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Franchising.
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Exporting.
Exporting
What is the primary focus of corporate-level plans?
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Marketing strategies.
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The organisation as a whole.
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Functional departments.
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Strategic business units.
The organisation as a whole.
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In the BCG matrix, what is a “star” characterised by?
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Low growth and low market share.
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Low growth and high market share.
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High growth and high market share.
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High growth and low market share.
High growth and high market share.
In the context of the GE approach, what should a company do if it rates high on business strengths and the industry is very attractive?
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Harvest the business.
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Be cautious when investing.
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Invest in the business and build market share.
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Divest the business.
Invest in the business and build market share.
What is Green marketing?
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Marketing to increase profit.
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Marketing environmentally safe products and services in a way that is good for the environment.
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Marketing new products
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Marketing to diverse populations
Marketing environmentally safe products and services in a way that is good for the environment.
Which is an example of a question that competitive analysis seeks to answer?
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What is our companies mission statement
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What are the strengths and weaknesses of a direct competitor?
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What is the state of the economy?
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How can we make this product cheaper?
What are the strengths and weaknesses of a direct competitor?
What is the role of a situation analysis in strategic planning?
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To set marketing objectives.
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To assess an organisation’s internal and external environments.
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To develop a company’s mission statement.
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To formulate strategies.
To assess an organisation’s internal and external environments
Which of the following exemplifies a weakness in a SWOT analysis?
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Efficient distribution network.
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Reputation for great service.
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Lack of human resources talent.
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Strong financial position.
Lack of human resources talent
What constitutes the macro environment in an external analysis?
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Competition, suppliers, and customers.
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Economic factors, demographic trends, and technological changes.
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Marketing intermediaries.
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The company itself.
Economic factors, demographic trends, and technological changes
What is the focus of market development strategies?
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Creating new products for existing customers.
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Entering new markets with existing products.
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Increasing sales of existing products to existing customers.
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Offering unrelated products to existing products produced by the organisation
Entering new markets with existing products
Which of the following describes franchising as a market entry strategy?
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Selling products to buyers in foreign markets.
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Granting an independent operator the right to use your company’s business model, techniques, and trademarks for a fee.
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Hiring manufacturers to produce products in another country.
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Combining expertise and investments with another company.
Granting an independent operator the right to use your company’s business model, techniques, and trademarks for a fee.
At what level of an organisation do corporate-level plans take place?
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Functional level.
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Business unit level.
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Top executive level for the corporation as a whole.
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Department level.
Top executive level for the corporation as a whole
What is the primary aim of a company that decides to harvest a product?
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To increase investment in the product.
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To build market share.
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To generate short-term profits regardless of the long-term impact.
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To drop or sell the product.
To generate short-term profits regardless of the long-term impact
According to the sources, what are some key aspects of AIS’s corporate culture that contributed to their success?
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Focusing solely on financial success.
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Commitment to philanthropy, supporting “Made in USA” initiatives, and customer service focus.
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Prioritising cost control above all else.
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Ignoring diversity and equality.
Commitment to philanthropy, supporting “Made in USA” initiatives, and customer service focus
What is the meaning of competitive advantage?
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Imitating competitors easily
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Establishing and maintaining an advantage that competitors cannot imitate easily
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A focus on efficiency alone
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Ignoring customer needs
Establishing and maintaining an advantage that competitors cannot imitate easily
When is direct investment used?
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When a company wants the least control and risk
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When a company wants to share profits and losses
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When a company wants the most control but also having the most risk
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When a company wants to use contract manufacturing
When a company wants the most control but also having the most risk
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Which of the following best describes a value proposition?
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a) A financial statement outlining a company’s projected profits.
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b) A detailed marketing plan with strategies for each business unit.
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c) A brief statement summarising the key benefits a product or service offers to target customers, explaining why they should buy it.
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d) An analysis of a company’s internal strengths and weaknesses.
c) A brief statement summarising the key benefits a product or service offers to target customers, explaining why they should buy it
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A hotel chain is considering expanding into a new geographic market. Which of the following market entry strategies would represent the least risky approach?
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a) Direct investment by building a new hotel.
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b) Forming a joint venture with a local hotel operator.
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c) Franchising its brand to an independent operator.
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d) Exporting its brand by allowing foreign travel agencies to book rooms.
d) Exporting its brand by allowing foreign travel agencies to book rooms
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A company that manufactures cleaning products has noticed an increasing consumer interest in environmentally friendly products. How could this company use green marketing to their advantage?
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a) By increasing the amount of packaging used to ensure the product arrives safely.
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b) By marketing their products as environmentally safe and good for the environment.
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c) By ignoring the trend and continuing with their current marketing strategy.
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d) By lobbying the government to relax environmental regulations.
b) By marketing their products as environmentally safe and good for the environment
A local bakery is struggling to compete with a larger chain bakery that has recently opened nearby. Which of the following strategies would be most appropriate for the local bakery to implement based on SWOT analysis?
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a) Lower prices to match the larger chain, even if it means reducing profit margins.
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b) Focus on a niche market, such as gluten-free or vegan baked goods, and emphasise the use of locally sourced ingredients.
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c) Expand the bakery’s product line to include items such as sandwiches and salads.
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d) Increase advertising spending to compete with the larger chain’s marketing budget.
b) Focus on a niche market, such as gluten-free or vegan baked goods, and emphasise the use of locally sourced ingredients
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A company’s objective is “to increase customer satisfaction.” What would be a more effective way to state this objective so that it can be used in strategic planning?
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a) To increase customer satisfaction by the end of the year.
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b) To increase customer satisfaction by any means possible.
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c) To increase customer satisfaction to the highest level.
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d) To increase customer satisfaction by 15% by the end of the year, as measured by customer surveys
d) To increase customer satisfaction by 15% by the end of the year, as measured by customer surveys
A beverage company is deciding how to allocate resources among its different product lines: soft drinks, bottled water and fruit juices. According to the BCG matrix, how should the company manage a product line (such as bottled water) that has a high market share in a low-growth market?
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a) Invest heavily in the product line to increase its growth potential.
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b) Divest the product line to focus on higher-growth areas.
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c) Harvest the product line to generate cash flow, even if it means sacrificing long-term growth.
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d) Ignore the product line and focus on other areas of the business.
c) Harvest the product line to generate cash flow, even if it means sacrificing long-term growth
A car manufacturer is considering entering the electric vehicle market. Using the GE approach, what factors would they need to evaluate to determine whether to invest in this opportunity?
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a) The company’s internal strengths (such as technological expertise and financial resources) and the attractiveness of the electric vehicle industry (such as growth rate and profitability).
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b) The company’s mission statement and value proposition.
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c) The company’s past performance and current market share.
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d) The company’s organisational structure and corporate culture.
a) The company’s internal strengths (such as technological expertise and financial resources) and the attractiveness of the electric vehicle industry (such as growth rate and profitability).
A company is facing increasing competition in its existing market. Which market strategy would focus on increasing sales of existing products to existing customers?
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a) Market development.
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b) Product development.
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c) Market penetration.
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d) Diversification.
c) Market penetration
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How do functional-level plans relate to business-level and corporate-level plans within an organisation?
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a) Functional-level plans are independent of business-level and corporate-level plans.
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b) Functional-level plans must be consistent with and help the organisation achieve its objectives at both the business and corporate levels.
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c) Functional-level plans are only relevant to the specific department or function.
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d) Functional-level plans are developed independently by each department or function.
b) Functional-level plans must be consistent with and help the organisation achieve its objectives at both the business and corporate levels.
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A furniture manufacturer sources as much material as possible from local neighbors, sharing a dedication to sourcing as much material as possible from neighbors while encouraging other businesses in New England to do the same. Which of the following concepts does this BEST represent?
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a) Distributive justice.
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b) Corporate social responsibility.
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c) Green marketing.
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d) Ethical sourcing.
b) Corporate social responsibility
Which of the following is the best example of a mission statement?
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a) “To increase sales by 15% in the next fiscal year.”
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b) “To be the leading provider of innovative solutions that transform the way businesses operate worldwide”.
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c) “To develop new products for existing customers”.
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d) “To have a high growth and a high market share”.
b) “To be the leading provider of innovative solutions that transform the way businesses operate worldwide”.
A company has a strength in its efficient distribution network. According to a SWOT analysis, how can this strength be used?
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a) To address internal weaknesses within the organisation.
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b) To capitalise on external opportunities in the marketplace.
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c) To mitigate external threats from competitors.
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d) To ignore external factors and focus on internal improvements.
b) To capitalise on external opportunities in the marketplace
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According to Porter’s Five Forces model, which of the following factors can affect a company’s strategies?
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a) The bargaining power of suppliers.
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b) The company’s internal strengths and weaknesses.
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c) The company’s mission statement.
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d) The company’s diversification strategy.
a) The bargaining power of suppliers
A beverage company is considering launching a new line of zero-sugar drinks. Which environmental factor is most likely driving this strategic decision?
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a) Political and legal regulations.
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b) Technological changes.
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c) Demographic, social, and cultural trends.
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d) The price and availability of natural resources.
c) Demographic, social, and cultural trends
Which of the following market entry strategies involves the most risk and control for a company entering a foreign market?
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a) Exporting.
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b) Licensing.
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c) Joint ventures.
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d) Direct investment.
d) Direct investment
A company is using the BCG matrix to analyse its strategic business units (SBUs). What does it mean if an SBU is classified as a “dog”?
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a) It has high growth and a high market share.
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b) It has a low share of a high-growth market.
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c) It has low growth and a low market share.
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d) It has a large share of a shrinking market
c) It has low growth and a low market share
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How does a market penetration strategy differ from a market development strategy?
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a) Market penetration involves creating new products for existing markets, while market development involves selling existing products to new markets.
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b) Market penetration involves selling existing products to new markets, while market development involves creating new products for existing markets.
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c) Market penetration involves selling more of existing products to existing customers, while market development involves selling existing products to new markets.
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d) Market penetration involves diversifying into unrelated markets, while market development involves consolidating existing market share.
c) Market penetration involves selling more of existing products to existing customers, while market development involves selling existing products to new markets
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In the strategic planning process, what is the role of situation analysis?
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a) To define the organisation’s mission statement.
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b) To assess the organisation’s internal and external environments.
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c) To set measurable objectives for the organisation.
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d) To formulate specific marketing tactics.
b) To assess the organisation’s internal and external environments
A company’s marketing department sets a goal to “increase brand awareness.” Which of the following is a more effective way to state this objective for strategic planning purposes?
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a) Increase brand awareness through social media campaigns.
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b) Achieve maximum brand awareness in the target market.
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c) Increase brand awareness by 20% among the target demographic within six months, as measured by online surveys.
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d) Enhance brand recognition to improve customer perception.
c) Increase brand awareness by 20% among the target demographic within six months, as measured by online surveys.
A CEO spearheaded a pivot from the company’s manufacturing lines to make high-quality facemasks to help fight COVID-19, launching a nationwide initiative engaging volunteers to donate over 600,000 facemasks to first responders, frontline workers, and people in need. Which of the following concepts does this BEST represent?
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a) Adaptability.
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b) Market penetration.
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c) Green marketing.
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d) Diversification.
a) Adaptability.
