Learn Smart 5 Flashcards
Large companies often employ multibrand strategies to better compete with
companies that employ a focused differentiation strategy
Which of the following allow a company to sell directly to customer effectively?
- Maintaining a direct sales staff
- conducting sales through a company website
Improving customer service or adding extra services are ways to manage the value chain to create product
differentiation
Companies can provide superior customer value by offering products with features that
are cheaper for a consumer to use
Successful differentiation strategies allow companies to
- cultivate buyer loyalty
- increase unit sales
A differentiation strategy might fall in which situations?
- When consumers see little value in the unique features of a product
- when products and services can be quickly imitated
Best-cost provider strategies are intended to provide value- conscious buyers with
-a quality product at a relatively low price
A company with a value chain system that sells directly consumer is able to
bypass the costs of distributors
What pitfalls should low cost providers avoid?
- Fixating on cost reduction to the exclusion of product features
- relying on a cost reduction approach that is easy to copy
Signaling product value as a differentiation strategy is especially important when
-the nature of the differentiation is based on intangible features
A company that employs best-cost provider strategy is vulnerable to which of the following?
- companies that employ a low-cost strategy
- companies that employ a high end differentiation strategy
Companies use differentiation strategies when consumers preferences are
- too diverse for a standardized product offering
Hotels differentiate their services by offering
- dining in the hotel
- an extensive range of guest amenities
- large rooms
T/F
if a company’s efforts to differentiate its products are met with consumer disinterest, the company puts itself at risk for lower profits
T
Focused low-cost strategies are common for companies that produce what?
-generic goods that imitate name brand products
How does Nucor corporation produce steel at a far lower cost than traditional steel mills
- a lower capital investment
- a smaller workforce
- lower operating costs
Coordinating with retailer allows a company to do which of the following?
- fill orders more accurately
- enhance the buying experience
- improve the companys image
In a market where buyer preferences are diverse, how can industry rivals differentiate their products?
-offer products that appeal to specific buyers
To achieve a cost advantage in a market niche, companies must
- use cost drivers to keep production costs low
- omit nonessential steps
If a low-cost provider has invested heavily in its current means of operating
-it will be expensive for the provider to shift to a new technology
in gaining a cost advantage over competitors, a low cost provider must offer
services and features that buyers think are essentaial
how do companies with a focused, low-cost strategy to secure a competitive advantage?
-serving niche market customer at a lower cost than rivals
which of the following companies are noted for their successful use of low-cost provider strategies?
- Bic
- Walmart
- Vizio
which of the following allow a company to sell directly to customer effectively
- maintaining a direct sales staff
- conducting sales through a company website
Nucor corporation eliminates many steps in the steel manufacturing process by using what equipment?
electric arc furnaces
which companies employ a focused low-cost strategy?
- Sleep-Inn
- Motel 6
- Super 8
Although successful low-cost providers continually look for ways to save money, they also understand the importance of spending money on
resources that further eliminate costs
As part of a differentiation strategy, what signals tell customer that the company’s products have superior value?
- ads emphasizing a products notable attributes
- higher quality sales materials
- more appealing packaging than competing products
A low-cost provider strategy is risky if a competitor
discovers a lower-cost value approach
In terms of a company strategy based on differentiation, what are the risks of offering mostly insignificant improvements in quality or service
- decreased customer loyalty
- lower company profits
which companies have a well-defined market niche?
- Tesla
- Fox News
- Blue Nile
Differentiation strategies fail when which of the following occur?
- When buyers don’t value a product of brands uniqueness
- When competitors match a company’s differentiation strategy
A particular differentiation strategy has a better chance of succeeding when
there are few rival companies using the same approach
A company that employs a focused differentiation strategy may experience intense competition if
the market segment becomes too attractive
What can a business use to reduce production costs for a cost-advantage strategy?
- automatic robotic technology
- computer -assisted design
A low-cost provider can use low prices to
persuade potential customer to switch brands
Companies can increase customer satisfaction by incorporating such tangible features as
- Improved functions
- More appealing product specifications
- Updated Styling
What methods help a company use cost drivers effectively ?
- Capturing all available economics of scale
- improving supply chain efficiency
- Operating facilities at full capacity
Focusing on a single market niche is an attractive strategy for what type of firm?
Small companies that lack the resources to pursue a broader customer base
Which of the following is one option that companies have for translating a low-cost advantage into profit performance?
- under pricing competitors
Differentiation strategies can increase a company’s profitability if
- Increased strategies are more than enough to cover the costs of differentiation
- Product prices can be raised sufficiently
A company that develops a strong relationship with its suppliers is more likely to have its supply needs prioritized
when industry supply is insufficient to meet overall demand
Online systems and advanced software can help a company achieve operating efficiency by
- Reducing parts inventories
- Cutting production times
Companies can create a differentiation-based competitive advantage by incorporating intangible features such as
appealing to buyer desires for prestige
Revamping the value chain by coordinating with suppliers can be expected to
- Speed delivery to end customers
- Speed up new product development cycles
Attempts to use low-cost advantage to attack rival companies with lower product prices can result in which of the following?
- Retaliatory price cuts
- A price war among several rivals
- Reduced profits
Which of the following are good opportunities for a company to pursue a low-cost provider strategy?
- When consumers use a product offered by rival companies in the same way
- When rivals offer virtually identical products
- When price competition among competitors is vigorous
Focused strategies differ from low-cost provider and differentiation strategies by
concentrating attention on a market niche
In terms of differentiation strategy, fast-paced technology change and quickly evolving product features can
- Help companies set themselves apart with different products
- Increase buyer interest
Which situations make it more likely that a focused differentiation strategy will be successful?
- Few rivals attempt to specialize in the same niche
- The industry has many different niches
- Industry leader choose not to compete in the niche
