Marketing III

Question 1

What is “lateral diversification?

Answer 1

Production of new goods which diverge from the same process / Source or which are used as materials for the same goods.
ex. Meatseller starts selling Horns and Hides.

Question 2

Which types of Diversification do you know of?

Answer 2

• Lateral Diversification
• Horizontal Diversification
• Conglomerate Diversification
• Vertial Diversification

Question 3

What is “Horizontal Diversification”?

Answer 3

Adding parallel Products to the existing product line. Existing tech., marketing and financial expersite will be applied to the new product.

ex. food selling company starts selling kitchenware (marketing same)
ex. II. TV company starts selling Musicsystems (Tech. same)

Question 4

What is “Conglomerate Diversification” ?

Answer 4

Adding unrelated products or services to the existing products / original product portfolio:
- An automobile manufacturer starts offering financial services

Question 5

What is “Vertical Diversification”?

Answer 5

Expanding business to manufacturing / distribute which precede or succeed the process the firm is already in by two ways:

1. Backward Integration
   instead of buying supplies the firm manufactures them
   ex. Chocolate firm get a cacao farm
2. Forward Integration
   involving distribution / selling into the firm
   ex. A miller starts his own bakery

Question 6

What does the Waterfall Strategy stand for?

Answer 6

It’s a Sequence Strategy which aims to entry international markets step by step.
After the firm has experience in the domestic market, similar markets are added. (First Germany, next Austria)

+ : Low Risk, gradually gaining experience

• : Slow penetration of the international markets

Question 7

What does the Sprinkler Strategy aim for?

Answer 7

It’s a Sequence Strategy which involves entering various international markets at the same time (or in a brief period)

+ : high sales volumes can be generated
Because of many short product lifecycles there aren’t many options for step wise international market penetration

Question 8

What are the seven Ps?

Answer 8

1. Product
2. Price
3. Place
4. Promotion
5. Process
6. Physical facility
7. Personnel

Question 9

Which features are in the category “Product”?

Answer 9

• Product core
• Design
• Packaging
• Labeling
• Value-addes services
• Innovation
• Differentiation

Question 10

Which features are in the category “ Price”?

Answer 10

1. Monetary costs
   - Bonuses and discounts
   - Credits
   - Follow-up costs
2. Non-monetary costs
   - Opportunity costs

Question 11

Which features are in the category “Place”?

Answer 11

• Acquisitive
• Sales policy
• Sales channel policy
• Sales logistics
• Sales system

Question 12

Which features are in the category “Promotion”?

Answer 12

• Advertising
• Sales Promotion
• Trade fairs and exhibitions
• Product placement
• Sponsoring
• Social Media communication
• Event Marketing

Question 13

Which features are in the category “Process”?

Answer 13

• Commitment
• Integration effect
• Integration intensity
• Integration form
• Quality
• Coordination
• Flexibility

Question 14

Which features are in the category “Physical facility”?

Answer 14

• External appearance
• Internal appearance
• Architecture
• Closer and distant surroundings
• Business premises

Question 15

Which features are in the category “Personnel”?

Answer 15

• Number
• Availability
• Know-How
• External appearance
• Empathy