Module 10 - Positioning

Question 1

11 Marketers should concentrate on ____ attributes to define product space in a positioning analysis:
A.determinant.
B.common.
C.competitor.
D.perceptual.
E.defined.

Answer 1

A

Question 2

12 Once we have identified all of the relevant determinant attributes we need to:
A.incorporate as many as possible into our market communications.
B.uncover which ones lead to purchase decisions.
C.develop a new product that incorporates these attributes.
D.use the fewest number possible to avoid confusion.
E.advertise only those which are most common to competing brands.

Answer 2

D

Question 3

13 In a positioning study, the lack of brands perceived as possessing certain levels of specific attributes may indicate:
A.an opportunity for a new market entrant.
B.an impossible position to obtain.
C.an undesirable position as too few customers exist.
D.all of the above.
E.only B and C above.

Answer 3

D

Question 4

14 The problem with product positioning analysis is that:
A.it is expensive relative to other forms of market information.
B.the results are ambiguous and difficult to interpret.
C.data collection is complex and open to error.
D.few analysts are qualified to interpret this kind of analysis.
E.it does not provide information on which positions are most appealing to customers

Answer 4

E

Question 5

15 The advantage of combining a product positioning analysis with a market position analysis is that together they can identify:
A.multiple positions to exploit.
B.which brands are considered best by means of determinant attribute.
C.gaps in the product space.
D.the competitive strength of different brands in different segments.
E.all of the above.

Answer 5

D

Question 6

16 What is the most recent approach, being adopted by a growing number of firms, to writing the desired positioning for a product?
A.Positioning statement
B.Value proposition.
C.Product positioning analysis.
D.Factor analysis.
E.Multidimensional scaling

Answer 6

B

Question 7

17 Which of the following items is included in a value proposition, but not a positioning statement?
A.Product features.
B.Target market.
C.Benefits.
D.Price range.
E.Manufacturing process.

Answer 7

D

Question 8

18 Value propositions are:: I. generally written for external use II. short and succinct III. written in catch consumer language Which of the above is true?
A.I and II.
B.II and III.
C.I and III.
D.I only.
E.II only

Answer 8

E

Question 9

19 A perceptual map is also called:
A.a value proposition.
B.a determinant attribute.
C.a positioning grid.
D.a positioning statement.
E.a unique selling proposition.

Answer 9

C

Question 10

20 The first step in the positioning process is:
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.Analyse the intensity of a product’s current position.
D.Identify a relevant set of competitive products.
E.Write a positioning statement or a value proposition

Answer 10

E

Question 11

1 Positioning must be defined relative to:
A. consumer needs and competitive offerings.
B. physical dimensions and psychological dimensions.
C. price and value.
D. style and price.
E. value and durability.

Answer 11

A

Question 12

2 When a firm wants to position one of its brands what is it trying to do?
A. Get competitors to recognise its presence.
B. Provide a platform from which it can generate advertisements.
C. Get a group of consumers to perceive its brand favourably in relation to competitive brands.
D. Get a group of consumers to be familiar with the physical features of its brand.
E. Find a basis upon which to segment a market for its brand.

Answer 12

C

Question 13

2 When a firm wants to position one of its brands what is it trying to do?
A. Get competitors to recognise its presence.
B. Provide a platform from which it can generate advertisements.
C. Get a group of consumers to perceive its brand favourably in relation to competitive brands.
D. Get a group of consumers to be familiar with the physical features of its brand.
E. Find a basis upon which to segment a market for its brand.

Answer 13

E

Question 14

4 Physical product positioning analysis is especially useful in:
A. developing a promotion campaign aimed at consumers.
B. product modifications and extensions.
C. identifying and designing new-product offerings.
D. understanding how the customer views the product.
E. developing new target markets.

Answer 14

C

Question 15

5 When consumers evaluate a pickup truck on the basis of how comfortably it rides, they are evaluating it on the basis of what it:
A. should be, rather than on the basis of what it is.
B. is, rather than on the basis of what it used to be.
C. was, rather than on the basis of what it is.
D. used to be, rather than on the basis of what it is.
E. does, rather than on the basis of what it is.

Answer 15

E

Question 16

6 Which of the following is NOT characteristic of physical positioning?
A. Consumer orientation.
B. Physical characteristics.
C. Data readily available.
D. Large number of dimensions.
E. Objective measures.

Answer 16

A

Question 17

7 Consumers who evaluate a new car on the basis of an abstract attribute would use which of the following dimensions?
A. Prestige.
B. Roominess.
C. Price.
D. Headroom.
E. Horsepower.

Answer 17

A

Question 18

8 It can be argued that perceptual product positioning is ____ for non-durable consumer goods and ____ for consumer durable goods:
A. essential; less important.
B. less important; essential.
C. essential; essential.
D. less important; less important.
E. less important; more important.

Answer 18

A

Question 19

9 Attributes are the bases upon which ____ are created. ____ attributes are the most important to communicate to a target market.
A. positions; Feature-based.
B. positions; Determinant.
C. market segments; Feature-based.
D. market segments; Determinant.
E. target markets; Feature-based

Answer 19

B

Question 20

10 Positioning analysis at the product category level examines:
A. customer perceptions about new applications for existing products.
B. customer perceptions about types of products they might consider as substitutes to satisfy the same basic need.
C. customer perceptions about a brand compared to other existing brands.
D. customer perceptions about types of products they might consider as complements to the existing product.
E. customer perceptions about new products that might fill the same need.

Answer 20

B

Question 21

What is meant by positioning?

Answer 21

• consumers choose what they buy for two reasons
• what they choose is better
• or its cheaper
• in either case, the good or service they choose is almost always different from others they could have chosen
• a company can outperform its rivals only if it can establish a difference that it can preserve
• Differentiation is what people buy

positioning allows companies to take advantage of the specific needs of a segment and be more responsive to it
differences can be physical or perceptual
creating both is what positioning seeks to accomplish

Question 22

What are the differences between physical and perceptual positioning?

Answer 22

As we saw in the previous module, customers in one market segment have wants and needs that differ in some way from those of customers in other segments. Brand positioning allows the marketer to take advantage of and be responsive to such differences and position particular goods and services so as to better meet the needs of consumers in one or more of these segments. These differences are often physical. Nike’s original waffle sole was such a difference, as we saw in Module 9. But differences can also be perceptual, as with Nike’s later products that benefited from endorsements by John McEnroe, Michael Jordan, and other famous athletes. Creating both physical and perceptual differences, using all the elements of the marketing mix – product, pricing, promotion, and distribution decisions – is what effective positioning seeks to accomplish.

Question 23

What are the limitations of physical positioning?

Answer 23

• does not provide a picture of what’s inside a customers mind
• customers attitude depends on social and psychological factors not amenable to objective comparison

Question 24

What are the steps in the positioning process?

Answer 24

Question 25

What are some of the more common types of bases used to distinguish one product or service from another?

Answer 25

positioning is based on a variety of attributes:

• features – physical attribute
• benefits – linked to features - e.g. Volvo and safety
• parentage – who makes it, prior products
• manufacturing process – time dedicated to you
• ingredients – German beer
• endorsements -experts and celebs
• comparison – Pepsi challenge
• pro-environment – portrays itself as green
• price/quality – dunnes stores
• the more attributes are used to position a product, the more confusion is caused
• must be aware of the importance attached to attributes

If all products are deemed to be the same in terms of a particular attribute, the that attribute is not a determinant attribute

to find determinant attribute, use market research

Question 26

What constraints are imposed on a brand with an intense position?

Answer 26

• attaining a position imposes constraints on future strategies
• if shift in the marketing environment reduces the importance customers attach to a current determinant attribute, it may be difficult to reposition a brand which has an embedded position
• another concern is the dilution of an existing intense position as a result of consolidation – British Leyland
• overexploiting of a intensely positioned brand may also be a danger e.g. Holiday Inn

Question 27

What are the limitations of a product positioning analysis?

Answer 27

• product positioning analysis as represented by the perceptual map does not tell marketer which attributes are important to customers
• no way of telling if there is a space for a new brand that might locate in a positioning ‘gap’ or whether consumers in other market segments might prefer brands with different attributes and positions – this is called market positioning analysis i.e. step 5 below

Question 28

In choosing a given position for a given brand, what factors should one consider?

Answer 28

• the final decision about where to position a brand should be based on both the market targeting analysis shown in module 9 and results of market positioning analysis
• the position should reflect
  
  • preferences of a market segment
  • current positions of competing brands
  • current and future attractiveness of target market – expected growth, size and environment
  • relative strengths and weaknesses of competitors
• above info plus analysis of costs required to maintain such a position allows an economic assessment of positioning options
• most products are positioned based on one or, at most, two determinant attributes
• me-too products have no differentiation and hence success is hard to achieve
• normally its good practice to write down what is intended for the product in a positioning statement or a value proposition

Question 29

Designing a marketing programme and product that a segment’s customers will perceive as desirable and that will simultaneously provide the firm with a differential advantage over current and potential competitors is known as:
A. market targeting.
B. marketing research.
C. product definition.
D. market exploration.
E. product positioning.

Answer 29

E

Question 30

In describing a car, its width, length, weight and headroom are all examples of its:
A. physical dimensions.
B. psychological dimensions.
C. psychographic dimensions.
D. lifestyle dimensions.
E. perceptual dimensions.

Answer 30

A

Question 31

A few years ago, several entrepreneurs noticed that none of the hotel chains offered room rates below $25 a night. Such prices were usually available from old, unattractive motels in inconvenient locations. Consequently, the entrepreneurs opened new franchises aimed at a price-conscious market segment. This is an example of:
A. physical product positioning analysis.
B. perceptual positioning analysis.
C. target market analysis.
D. mass-market strategy.
E. none of the above.

Answer 31

A

Question 32

Physical product positioning analysis is especially useful in:
A. developing a promotion campaign aimed at consumers.
B. product modifications and extensions.
C. identifying and designing new-product offerings.
D. understanding how the customer views the product.
E. developing new target markets.

Answer 32

C

Question 33

When Ford Motor Co. succeeded in convincing adult women through advertising that the Ford Explorer was safe, comfortable, and had off-the-road abilities, what did this result represent?
A. A perceptual position.
B. An anticipatory position.
C. A physical position.
D. A defensive position.
E. Both A and C above are correct.

Answer 33

A

Question 34

When consumers evaluate a pickup truck on the basis of how comfortably it rides, they are evaluating it on the basis of what it:
A. should be, rather than on the basis of what it is.
B. is, rather than on the basis of what it used to be.
C. was, rather than on the basis of what it is.
D. used to be, rather than on the basis of what it is.
E. does, rather than on the basis of what it is.

Answer 34

E

Question 35

Consumers view which of the following attributes as a simple physically based attribute in evaluating a new car?
A. Roominess.
B. Prestige.
C. Image.
D. Price.
E. Efficiency.

Answer 35

D

Question 36

All of the following are examples of the characteristics of physical positioning analyses EXCEPT:
A. readily available data.
B. physical attributes.
C. attitudes toward the brand.
D. direct R&D implications.
E. technical orientation.

Answer 36

C

Question 37

All of the following are examples of the characteristics of physical positioning analyses EXCEPT:
A. qualitative comparisons.
B. direct R&D implications.
C. physical characteristics.
D. physical brand properties.
E. a large number of dimensions.

Answer 37

A

Question 38

Excitement and prestige are ____ attributes influenced by ____ characteristics which share a ____ relationship:
A. physical; concrete; direct.
B. physical; concrete; indirect.
C. perceptual; concrete; direct.
D. perceptual; concrete; indirect.
E. perceptual; physical; direct.

Answer 38

D

Question 39

Consumers who evaluate a new car on the basis of an abstract attribute would use which of the following dimensions?
A. Prestige.
B. Roominess.
C. Price.
D. Headroom.
E. Horsepower.

Answer 39

A

Question 40

A knowledgeable consumer who is familiar with this product class is likely to base her eye-shadow purchase on:
A. ease of application.
B. whether the eye shadow case has a mirror or not.
C. its perceived ability to captivate men.
D. the sexiness of the brand’s spokesperson.
E. both A and B above are correct.

Answer 40

E

Question 41

When Campbell’s positions its soups for use as dips and sauces, which attribute is it stressing in its advertising?
A. Benefits.
B. Usage.
C. Features.
D. Parentage.
E. Ingredients.

Answer 41

B

Question 42

At what level would a positioning analysis be taking place if Carnation was studying the possibility of developing a new type of instant breakfast and compared its concept idea to cereals, eggs and bacon and English muffins?
A. Product category.
B. Brand level.
C. Niche level.
D. Mass-market level.
E. Repositioning level.

Answer 42

A

Question 43

When Volvo stresses the safety features in its cars, which attribute is it stressing in its advertising?
A. Product feature.
B. Surrogate.
C. Customer benefit.
D. Use.
E. Price.

Answer 43

C

Question 44

What attribute is Pedigree stressing in advertising when they state ‘Tests prove Pedigree is more nutritious than IAMS, costs less than IAMS, and tastes great too’?
A. Price/quality.
B. Product class.
C. Ingredients.
D. Benefits.
E. Comparison

Answer 44

E

Question 45

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. analyse the intensity of a product’s current position.
D. identify a relevant set of competitive products.
E. select positioning or repositioning strategy.

Answer 45

D

Question 46

The second step in the product positioning process is to:
A. identify the set of determinant attributes that define the product space.
B. collect information from a sample of customers and potential customers about perceptions.
C. analyse the intensity of a product’s current position.
D. identify a relevant set of competitive products.
E. select positioning or repositioning strategy.

Answer 46

A

Question 47

The most significant danger in conducting only brand-level positioning analysis is that it can:
A. miss significant challenges from other competing brands.
B. position the firm’s brand incorrectly relative to the competition.
C. miss threats from possible substitutes in other products.
D. be inappropriate in the firm’s competitive environment.
E. be cost-ineffective in the sense that information gained is not justified by the cost.

Answer 47

C

Question 48

Attributes that play an important role, to at least some customers, and clearly differentiate among alternatives are known as ____.
A. common attributes.
B. market/customer factors.
C. competitive position factors.
D. relevant attributes.
E. determinant attributes

Answer 48

E

Question 49

The first step in analysing the intensity of an existing brand’s position is to assess its level of market ____.
A. acceptance.
B. strength.
C. relevance.
D. involvement.
E. awareness.

Answer 49

E

Question 50

One key constraint to consider when trying to establish an intense position in the market is that:
A. once you have established such a position, competitors will seek to take that position away.
B. once a brand has attained an intense position, it is very difficult to change that position.
C. brand intensity is very unstable, and customers are not likely to remain loyal over time.
D. brand intensity is easy to change provided the firm is willing to spend a lot of money on new promotional campaigns.
E. none of the above.

Answer 50

B

Question 51

Extending an intensely positioned brand to diverse product lines can lead to:
A. market share loss in the short term.
B. competitive responses which can do significant harm to a firm’s revenues.
C. a significant increase in consumer demand for products with that brand.
D. confusion among consumers as to what the brand stands for in each case.
E. higher marketing costs.

Answer 51

D

Question 52

An appropriate strategy for building an intense position, especially with low-involvement products (such as P&G has done with Crest toothpaste) is to associate the product with:
A. one determinant attribute and concentrate on that.
B. at least five salient attributes so that customers can pick one they are aware of.
C. at least five determinant attributes so any and all determinant attributes are conveyed to the customer.
D. a minimum of two salient attributes.
E. a competitor’s product.

Answer 52

A

Question 53

When interpreting a perceptual map, what indicates that a distinct market segment exists?
A. A cluster of brands.
B. A cluster of consumer ideal points.
C. A quadrant with three or more brands.
D. A cluster of products with the same set of shared benefits.
E. Perceptual maps cannot identify market segments.

Answer 53

B

Question 54

The last 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. analyse the intensity of a product’s current position.
D. identify a relevant set of competitive products.
E. write a positioning statement or a value proposition.

Answer 54

E

Question 55

Perceptual maps provide information about all of the following EXCEPT:
A. the competitive strengths of different brands in different segments.
B. the intensity of the rivalry between brands in a given segment.
C. the opportunities for gaining a differentiated position within a specific targeted segment.

E. perceptual maps provide all of the above.

Answer 55

D

Question 56

Which dimension, when used alone, is not typically useful in positioning a product?
A. Ingredients.
B. Usage.
C. Price.
D. Features.
E. Benefits.

Answer 56

C

Question 57

What is an important criterion for defining market segments?
A. The difference in the benefits sought by different customers.
B. Learning who the competitor’s customers are.
C. Defining the company’s ideal customer.
D. All of the above.
E. None of the above.

Answer 57

A

Question 58

A typical positioning statement contains the following points, EXCEPT:
A. Brand Name.
B. Target Market.
C. Product Features.
D. Product Category.
E. Unique Product Benefit.

Answer 58

C

Question 59

What are the major differences between physical and perceptual product positioning? Under what conditions would a firm be satisfied with simply a physical-position exercise? What kinds of firms would practise this kind of positioning? What dangers are involved?

Answer 59

The major difference between physical and perceptual product positioning is that the former is based on some set of objective physical characteristics. Such position- ing can provide useful information, particularly in the early stages of designing a new product. This is especially so with industrial goods. It also helps marketing in interfacing with R&D. But a comparison of alternative offerings based only on the physical dimensions of alternative offerings does not provide a complete picture of relative positions since positioning ultimately takes place in the consumers’ minds – i.e. it depends on how the product/brand is perceived. The evaluation of many products is subjective since it is determined by factors other than physical proper- ties. Undertaking a perceptual product positioning is therefore critical.

Question 60

What exactly does perceptual positioning accomplish for a consumer goods firm? For an industrial goods firm?

Answer 60

Since many consumer goods brands are similar in their physical characteristics, it is important to undertake a perceptual product positioning study to determine if consumers perceive them as being similar or being different because of different histories, names, and consumer attitudes. It is also important to note how compet- ing brands differ, not only from each other but against the consumer’s ideal brand. For industrial groups a perceptual positioning study will reveal how various customer groups perceive a given product on the basis of both its physical and nonphysical . In some cases the latter can be extremely important (e.g., service dimensions).

Question 61

What determines the intensity of a product’s perceived position in the marketplace? What might be done to increase the intensity of the position of a brand that currently holds a relatively small market share, such as Saab in the automobile market?

Answer 61

Perhaps most important, the positioning intensity of a brand depends on how strongly customers associate it with one or more determinant attributes when deciding which to buy. In addition, another factor is how strongly customers associate the brand with the product category. Establish an intense position by focusing on one or two key determinant attributes, as P&G did with Crest when it focused on decay prevention and received the endorsement of the American Dental Association. A better option for a firm holding a small market share, however, may be to concentrate on an attribute not strongly associated with the dominant brand, and to position itself as a feasible substitute for bigger brands under certain situa- tions, or for targeting a peripheral segment of the market.

Question 62

What is meant by a determinant attribute for a given product? Explain why the identification of such attributes is so important. What would be an example of a determinant attribute for the following products and services?

a. A cruise line.
b. A laptop computer.

d. Sportswear.
e. A hospital.
f. A liberal arts college.
g. A tractor.

Answer 62

Consumers typically use a relatively small number of attributes to evaluate products and brands. Consumers first consider only those attributes they are aware of, but the importance attached to those often varies. Even an important attribute may not be a strong influence on a consumer’s preference if the alternative brands are perceived as being about equal on that dimension. A determinant attribute is one which plays a major role in helping consumers differentiate among the alternatives and determine which brand they prefer. Possible determinant attributes for the following are: (a) A cruise line – number of ports visited. (b) A laptop computer – memory capacity. (c) French wine – availability in large bottles. (d) A sportswear – loose fitting. (e) A hospital – cleanliness. (f) A liberal arts college – business courses. (g) A tractor – operator comfort.

Question 63

Exhibit 10.5 is a perceptual map of women’s-clothing retailers in Washington, DC, which shows the ideal points of a given segment of consumers. What is an ideal point and how is it determined? How can it be used in relation to the development of a strategic marketing plan?

Answer 63

To measure customer preferences requires that respondents rate their ideal product or brand within a product category and use this as the basis for rating existing products. The results will show how the various brands are positioned versus the ideal. These ideal points can be clustered for a given market segment to determine its preferences. By comparing how (and why) the competing brands differ from one another based on their distances from one another and the cluster of ideal points, a firm can decide whether a new product concept is viable or what needs to be done to reposition an existing brand which will result in greater revenues.

Question 64

For a high-quality women’s-clothing retailer like Nordstrom, what would be the best market position strategy to adopt? Why?

Answer 64

Nordstrom already has an enviable position in terms of value and fashion ability. It could improve this position slightly by moving closer to segment 4.

Question 65

In terms of positioning strategy, what is the rationale for the fact that Nabisco offers many different brands within the cracker category, each of which is perceived as being only slightly different from the others? What are the advantages and limitations of such a strategy?

Answer 65

Nabisco may wish to pre-empt a strong move by the competition by introducing a second, similar brand positioned to appeal to the same market segment.

Advantages – it is better in the long run for a firm to compete with itself than to lose customers to other firms.

Disadvantages – this move cannibalises the market of the established brand and results in higher investments and lower economies of scale.

Question 66

The Credit Bank which offers a full range of financial services to customers has recently carried out a segmentation exercise which defined four age-based segments of potential mutual fund buyers: Young Investors (21 to 35); Accumulators (36 to 50); Pre-Retired (51 to 65); and Retired.

If the bank decides to go along with this age-based segmentation approach, how should they proceed to decide what targeting and positioning approaches to follow with respect to mutual funds?

Answer 66

This question invites candidates to impart their knowledge of segmentation, targeting and positioning. The relevant modules are Module 9 on Market Segmentation and Target Marketing and Module 10 on Positioning.

1. Good answers should indicate that each segment should be substantial, measurable, accessible and respond differently to marketing variables.
2. Targeting. The Following steps are involved in analysing and prioritising potential target markets.
   
   1. Selection of market attractiveness and business strength factors. This involves identifying the relevant variables for evaluating market segments and the firm’s competitive position regarding these and to weight these in order of importance. Each segment could then be evaluated in terms of market factors, economic and technological factors and environmental factors (size, growth rate and the level of competition for example). One useful tool could be the market attractiveness/business potential matrix.
   2. These factors can then be weighted.
   3. Segments should then be rated as to market attractiveness and in relation to company strengths.
   4. Managers should take into account the effects of the possible future market position.
   5. Finally desirable segments should be chosen and resources allocated. The bank may adopt a mass market strategy; a niche market strategy, focusing on one or more segments, or a growth market strategy focusing on the fastest growing segments. Very good answers may discuss product strength versus geographic expansion.
3. Good answers will stress the links between targeting and positioning. The positioning decision occurs once a decision has been reached with respect to which market to target. For example Credit Bank may decide to focus on the pre-retired market as the result of the targeting decision process. Positioning is covered in detail in Module 10; a positioning process chart indicated in Exhibit 10.4 . This would include:
   
   1. identifying the relevant set of competing products with respect to the target market (pre-retired segment);
   2. identifying the set of determinant attributes that define the product space;
   3. collecting and analysing data on customer perceptions;
   4. determinig the product current location in the product space against competitive offerings and the ideal.