MKTG 448 Exam 1 - FLASHCARDS - Competitive Strategies in Dynamic Markets
Why is the marketing arena of today increasingly complicated?
Any minor change in strategy may lead to major consequences. With conditions (e.g., competitors, customers, public policy) changing so quickly, hindsight proves less helpful, and the importance of seeing beyond the next few moves is not debatable.
True or false: Competing in today’s markets requires awareness of a company’s resources, capabilities, as well as customers, competitors, etc.?
TRUE
True or false: Having a single-minded strategy can be dangerous because of competition for customers?
TRUE
What two things should marketing strategists excel at?
Choosing where to play (product and customer segments), and figuring out the winning strategy (e.g., short- and long-term approaches to value delivery).
True or false: In zero-sum games, players fight to win a bigger “slice” of a “pie” that doesn’t change size. Rivalries are fierce, and each player strives aggressively to beat the other. The firm with the greatest resources and capabilities generally emerges as the winner?
TRUE
True or false: most marketplace competitions are non-zero-sum games, in which players have some complementary interests, as well as some that are in conflict?
TRUE
What happens in a non zero-sum game?
In non-zero-sum games, one player’s gain or loss does not necessarily result in a corresponding loss or gain for another.
What is a positive sum game?
Game where win-win solutions - ones in which both competitors benefit - are possible.
What is the most detrimental sum game where lose-lose solutions are likely to occur?
Negative sum game.
What is defined as a business’ crucial decisions concerning its planned pattern of behavior in the marketplace to achieve (facilitate the achievement of) a competitive advantage, and thereby realize specific organizational objectives?
Marketing strategy.
What is the rationale behind market orientation?
To achieve competitive advantage and superior performance, firms should systematically (1) gather information on present and potential customers and competitors and (2) use such information in a coordinated way to guide strategy recognition, understanding, creation, selection, implementation, and modification.
What is the rationale behind a market segmentation strategy?
To achieve competitive advantage and superior performance, firms should (1) identify segments of industry demand, (2) target specific segments of demand, and (3) develop specific marketing mixes for each targeted market segment.
What is the rationale behind brand equity?
To achieve competitive advantage, and thereby, superior performance, firms should acquire, develop, nurture, and leverage an effectiveness-enhancing portfolio of brands.
What is the rationale behind a relationship marketing strategy?
To achieve competitive advantage, and thereby, superior performance, firms should identify, develop, and nurture a relationship portfolio.
What is a blue ocean strategy?
Represent untapped market space, the creation of new demand, and the resulting opportunity of highly profitable growth.
What term describes a new market with little competition, or an unknown market space that is yet to be explored?
Blue ocean.
What do blue oceans allow firms to do in regards to pricing?
- Charge a higher price than the cost leader– higher value creation
- Can lower its price below that of the differentiator because of its lower cost structure.
True or false: a blue ocean can allow a firm to charge a higher price than the cost leader– higher value creation?
TRUE
True or false: a blue ocean can allow a firm to lower its price below that of the differentiator because of its lower cost structure?
TRUE
What term describes a market or industry that is already established and has cutthroat competition?
Red ocean.
What type of ocean strategy is where costs increase, profits fall, growth shrinks, and there is commoditization of products?
Red ocean.
What are characteristics of a blue ocean strategy?
Not about technology innovation– link existing technology to buyers’ value. Very often from within the industry. Don’t use competition as a benchmark. Reduce costs while offering customers more value.
True or false: blue ocean strategies are not about technology innovation and link existing technology to buyers’ value?
TRUE
True or false: blue ocean strategies don’t use competition as a benchmark?
TRUE
True or false: blue ocean strategies reduce costs while offering customers more value?
TRUE
What is an offensive strategy of pointing out the deficiencies in rivals’ offerings or highlighting the firm’s own advantages?
Comparative advertising.
What is an offensive strategy which prioritizes being the first to market with an innovation?
First mover advantage.
True or false: In product categories with large switching costs, being first can enable a company to capture customers and keep them, owning to the stickiness of the ensuing relationship?
TRUE
What is an offensive strategy where the firm believes that it can gain an advantage by copying another business’s innovation?
Imitation.
How can price be used as an offensive strategy?
Offering a comparable product at a lower price is a quick way to steal customers from a rival, particularly in industries characterized by elastic demand and highly price-sensitive customers. But to use price as an offensive weapon, a company must be the low-cost provider in the industry.
True or false: To sustain brand equity and loyalty and protect from competitive attack, companies should maintain steadfast marketing support for their products/brands?
TRUE
Is legal protection a defensive strategy?
Yes.
What marketing strategy is this an example of: Korg the revered Japanese auto brand with a history of dating back to the 1960s, is best known for synthesizers, keyboards, and music workstations. As of this year, it is diving headfirst into a new product category: portable record players?
Market coverage.
What marketing strategy is this an example of: Unlike Google, Duck Duck Go browsers have privacy built in with best in class tracker blocking that stops cookies and creepy ads that follow you?
Comparative advertising.
