Marketing Concepts Midterm Flashcards
Strategy is NOT…
A. performing different activities from competitors
B. performing similar activities in different ways
C. performing similar activities better than the way competitors perform them
D. establishing a difference that the firm can preserve
E. all of the above choices are different definitions of strategy
C. Strategy is about being different
Analyzing the 4Cs is necessary to provide the foundation for a good strategic marketing plan.
Which of the following is NOT one among them?
A. Company
B. Context
C. Customers
D. Cost
E. Competitors
D. Cost
A(n) _____________ is defined as being comprised of individuals and organizations that are
interested and willing to buy a good or service to obtain benefits that will satisfy a particular
need or want and who have the resources to engage in such a transaction:
A. industry
B. agency
C. market
D. business
E. retail department
C. A market is a set of buyers. Industry is a set of sellers.
When a company is attempting to differentiate its products to distinguish them from
competitors’ products, in which aspect of strategic management planning is the company
engaged?
A. Market segmentation strategy
B. Distribution strategy
C. Targeting strategy
D. Pricing strategy
E. Positioning strategy
E. The positioning strategy is aimed at distinguishing the brand from competitors.
The major components of the marketing environment include:
A. sociocultural, regulatory, economic, natural, and psychological.
B. technological, sociocultural, demographic, regulatory, natural, and economic.
C. national, cultural, subcultural, international, and domestic.
D. tertiary, secondary, primary, and local.
E. global, regional, national, domestic, state, and local
B. technological, sociocultural, demographic, regulatory, natural, and economic.
A major issue in a business strategy is that of:
A. sustainable competitive advantage.
B. coordinating marketing activities.
C. allocating marketing resources to accomplish the firm’s objectives.
D. creating a well-integrated program of marketing mix elements
E. specifying the target market(s) for a particular product line
A. sustainable competitive advantage.
Increased interest in healthy eating and fitness is an example of a(n) ______________ macro
trend:
A. regulatory
B. economic
C. natural
D. demographic
E. sociocultural
E. Sociocultural trends are those that have to do with the values, attitudes, and behavior
of individuals in a given society
The recent sudden reversal of policies by the Mexican government to encourage foreign
investment in Mexico is an example of which component of the macro-environment?
A. Technological environment
B. Political/legal environment
C. Natural environment
D. Demographic environment
E. Sociocultural environment
B. Political/legal environment
The aging of the world’s population is an example of a(n) ______________ macro trend
A. regulatory
B. economic
C. natural
D. demographic
E. sociocultural
D. Demographic
When a major department store chain in France, such as Carrefour, makes strong demands on
its apparel suppliers to reduce their costs so that Carrefour can reduce its need for clearance
sales, which competitive force does this represent for the apparel industry?
A. threat of new entrants
B. bargaining power of buyers
C. bargaining power of suppliers
D. threat of substitute products
E. little rivalry
B. The department store is a customer of the retailer and hence its strong demands are
manifesting the bargaining power of buyers
Brand loyalty is accomplished when consumers are _____ in the purchase process but search
for _____.A. highly involved; brand alternatives
B. highly involved; better retail prices
C. somewhat involved; little or no information
D. somewhat involved; better retail prices
E. highly involved; little or no information
E. Loyal customers don’t search for alternatives.
Dividing the market for a particular type of automobile into customers who seek style and
customers who seek durability is an example of:
A. demographic segmentation.
B. usage segmentation.
C. product differentiation.
D. demand function modification.
E. market segmentation
E. Market Segmentation
Generally, which of the following is a low-involvement purchase?
A. An automobile
B. A VCR
C. A computer
D. Cereals
E. Clothing
D. Cereals
When Hyatt Hotels announced a new marketing program which featured excursions and
social events for teenagers, at which marketing descriptor was this program aimed specifically?
A. Sex
B. Household life cycle
C. Education
D. Age
E. Income
D Targeting teenagers is obviously an age segmentation
When Ford notices that a large number of pickup trucks are sold in the Southwest U.S., on
which descriptor is it focusing?
A. Income
B. Age
C. Education
D. Occupation
E. Geography
E. Geography
Compared to physical positioning, perceptual positioning:
A. is consumer oriented.
B. is technically oriented.
C. has a large number of dimensions.
D. represents impact of product specs.
E. has direct R&D implications
A. Physical positioning starts from certain attributes that a product has, but perceptual
positioning starts from the needs of the customers and tries to distinguish itself from the rest by
working on the customer perception of the brand
When the total market for a given product category is fragmented into several groups of
people having relatively homogeneous needs, wants, and sought after benefits, these groups are
termed:
A. market fragmentation.
B. a differentiated market.
C. a counter-market.
D. a market segment.
E. market homogenization
D. A market segmentation
The first step in the product positioning process is to:
A. identify the set of determinant attributes that defines the product space.
B. collect information from a sample of customers and potential customers about perceptions.
C. analyze intensity of a product’s current position.
D. identify a relevant set of competitive products.
E. write a positioning statement or a value proposition
D. identify a relevant set of competitive products.
When a clothing retailer wants to target women between the ages of 25 to 55, earning an
annual income of $30,000 or more, in a five-mile radius of their store, they are using which
descriptor?
A. Geography
B. Geodemographics
C. Sex
D. Age
E. Income
B. The retailer is using both geography and demographic information to target certain
customers
which strategy involves serving one or more segments that, while not the largest, consist of
a sufficient number of customers seeking somewhat-specialized benefits from a good or
service?
A. Growth market strategy
B. Niche market strategy
C. Undifferentiated market strategy
D. Peripheral market strategy
E. Differentiated market strategy
B. Niche market strategy
Coca-Cola, which also owns Minute Maid orange juice and PowerAde, an energy drink, is
using what type of branding strategy for these products?
A. Family branding
B. Multiple branding
C. No-name branding
D. Individual branding
E. Co-branding
D. Individual branding
_____ uses the same brand name to cover a group of products or product lines.
A. Individual branding
B. Family branding
C. Co- branding
D. Global branding
E. Group branding
B. Family branding
- Under which set of circumstances is family branding advisable?
A. When the brand is well known and a new product has quality problems.
B. When advertising economies of scale exist and the brand has low perceived quality.
C. When advertising economies of scale exist and the products under the brand have variable
quality.
D. When advertising economies of scale exist and the brand has high perceived quality.
E. When the brand is a well known price leader and the new product is positioned toward a high
quality, high prestige portion of the market.
D. When advertising economies of scale exist and the brand has high perceived quality.
Which branding strategy imposes the greatest risk to brand equity?
A. Co-branding
B. Global branding
C. Individual branding
D. Family branding
E. Multiple brands
D. Family branding
Kellogg’s Raisin Bran and Kellogg’s Rice Crispies are examples of:
A. individual branding.
B. distributor branding.
C. private labeling.
D. family branding.
E. no-name branding
D. family branding.
The Ford Explorer Eddie Bauer edition illustrates which branding strategy?
A. Co-branding
B. Global branding
C. Individual branding
D. Family branding
E. Multiple brands
A. Co-branding
The production of appliances for Sears by Whirlpool under its own Kenmore name is an
example of:
A. manufacturer branding.
B. national branding.
C. individual branding.
D. sale of OEM components to competitors.
E. private labeling
E. private labeling
When the product market is in the introductory or growth stage, the firm is an early entrant,
target customers are sensitive to price, and the firm is pursuing a low-cost business-unit strategy.
Which pricing objective would be most appropriate?
A. Quality or service differentiation
B. Skimming
C. Harvesting
D. Survival
E. Penetration
E. Penetration
After setting a strategic pricing objective, the next step in the price setting decision process is
to:
A. estimate demand and price elasticity of demand.
B. determine costs and their relationship to volume.
C. examine competitors’ prices and costs.
D. select a method for calculating price.
E. set a price level
A. estimate demand and price elasticity of demand.
A skimming pricing objective can be used when
A. barriers block immediate entry by potential competitors.
B. the firm is the market leader among a group of competitors.
C. competitors are already established, and the firm wants to enter the market.
D. the firm is a low-cost producer among competitors in the market.
E. the firm has a weak position relative to other competitors in the market
A. barriers block immediate entry by potential competitors.
In the typical demand curve there is a(n) _________ relationship between a product’s price
and the quantity of that product demanded by consumers; the _________ the price, the ________
consumers want to buy.
A. inverse; higher; less
B. inverse; lower; less
C. direct; higher; more
D. direct; lower; more
E. inverse; higher; more
A. inverse; higher; less
Buyers of BMW automobiles perceive such cars as higher in quality and more prestigious
than other automobiles and are willing to pay more for these cars. This is an example of the
____________ effect.
A. unique-value
B. price-quality
C. substitute-awareness
D. difficult-comparison
E. end-benefit
B. price-quality
When a small increase in price leads to a relatively large drop in the quantity demanded, the
demand for the product is known as:
A. price inelastic.
B. unitary price.
C. price neutral.
D. price elastic.
E. cost insensitive
D. price elastic.
Which of the factors which affect customers’ sensitivity to price is Duracell emphasizing
when it claims in television ads that its batteries last longer than its competitors’?
A. Total-expenditure effect
B. Sunk-investment effect
C. Unique-value effect
D. End-benefit effect
E. Shared-cost effect
C. Unique-value effect
Which of the factors which affect customers’ sensitivity to price is a restaurant in a Hawaii
using when it charges its hotel guests premium prices for food because it assumes that they are
unaware of lower-priced restaurants in the area?
A. Shared-cost effect
B. Sunk-investment effect
C. Substitute-awareness effect
D. Unique-value effect
E. End-benefit effect
C. Substitute-awareness effect
Which of the factors which affect customers’ sensitivity to price is a car dealer using when it
charges a premium price for a car stereo which is installed in a luxury sedan?
A. Shared-cost effect
B. Substitute-awareness effect
C. Inventory effect
D. End-benefit effect
E. Unique-value effec
D. End-benefit effect
According to the price elasticity of demand, the _________ the proportion of price-sensitive
customers in a product’s market, the _________ sensitive overall demand is to a change in the
price of the product.
A. larger; more
B. larger; less
C. smaller; more
D. smaller; same
E. lesser; same
A. larger; more
When the price of gas skyrocketed during the 1970s, the sales of large cars made in the U.S.
plummeted. This event illustrates that consumers’ demand for gas was _________ while their
demand for luxury-sized automobiles was __________.
A. elastic; inelastic
B. highly elastic; highly inelastic
C. inelastic; elastic
D. strong; weak
E. either a or b above are correct
C. inelastic; elastic
Differential pricing involves a firm selling the same product at _________ to take advantage
of different market segments’ ____________.
A. multiple prices; price sensitivities
B. a higher than normal price; price inelasticity
C. a higher than normal price; price elasticity
D. multiple prices; price expectancies
E. a lower than normal price; price insensitivities
A. multiple prices; price sensitivities
Which one captures the “chasm” in the adoption of innovative products:
A. The difficulty in getting “early adopters” interested in the product after “innovators” have
already adopted the product.
B. Getting “late majority” and the “laggards” on board.
C. Having saturated the “visionary” market, trying to convince “pragmatists” to buy.
D. Getting from “early majority” to “late majority”
E. Getting from “late majority” to “laggards”
C. Having saturated the “visionary” market, trying to convince “pragmatists” to buy.
What is the best way to “cross the chasm”?
A. Focus on one segment (also called the beachhead segment), and try dominating that segment
by offering a “whole product” (a complete solution).
B. Focus on multiple segments and try to diversify the offerings.
C. Offer different solutions to different market segments.
D. Be content with innovators and early adopters.
E. Do market research on what makes early majority customers buy a product.
A. Focus on one segment (also called the beachhead segment), and try dominating that segment
Which one is not one of the potential issues with the positioning of Planters Nuts?
A. Women were not represented as a significant target market.
B. Only focused on a specific age range.
C. Some of their ads indicated special occasions as the most relevant time to use.
D. Their brand image was more established than their competitors.
E. Their competitors had easier-to-remember associations, such as heart-healthy, as their
positioning
D. Their brand image was more established than their competitors.
Which one could be a potential issue with Sports drink/Energy drink segmentation used for
Crescent Pure?
A. Not big enough segments compared to healthy drinks.
B. Not healthy product segments to be in.
C. Industry product categorizations rather than true market segments coming from real
differences between consumers.
D. None of the above.
E. All of the above
C. Industry product categorizations rather than true
Which one is not true about Amazon’s investments in different product categories?
A. A major reason behind producing content in the form of movies and TV series is keeping
Prime users engaged and growing.
B. Kindle is the razor product where the bulk of the profits comes from the blades (books).
C. AWS is recently developed with the focus on prime customers.
D. Whole Foods was purchased with the idea of making Amazon the one-stop shop for
everything including groceries.
E. All of the above are true
C. AWS is recently developed with the focus on prime customers.
Which one is not one of the potential challenges following Chase Sapphire Reserved card’s
product launch?
A. the 100,000 point sign-on bonus was expensive to retain, going forward.
B. churners would abuse the sign-on bonus and dilute the profitability of the product portfolio by
leaving early.
C. retention of the acquired customers throughout the next year would be an issue.
D. millennials were attracted to the card.
E. none of the above
D. millennials were attracted to the card.
What was the production era attitude and date?
Attitude: A good product will sell itself
Date: prior to 1920s
What was the sales era attitude and date?
Attitude: creative advertising and selling will overcome consumers resistance to buy and persuade them to buy
Date: prior to 1950s
What was the marketing era attitude and date?
Attitude: the consumer rules, find a need and fill it
Date: since 1950s
What was the relationship era attitude and date?
Attitude: long term relationships with costumers and other partners lead to success
Date: Since 1990s
what is market?
individuals and organizations who are interested and willing to buy a particular product to obtain benefits that will satisfy a need or want
What is a marketplace?
Where the products or services are sold
What is strategy?
A fundamental pattern of present and planned objectives,
resource deployments, and interactions of an organization with markets,
competitors, and other environmental factors.
What: (objectives to be accomplished)
Where: (on which industries and product-markets to focus)
How: (which resources and activities to allocate to each product-market to
meet environmental opportunities and threats and to gain a competitive
advantage)
