Chapter 2: Developing Marketing Strategies and Plans

GENERAL CONCEPT QUESTIONS

Multiple Choice

1. A key ingredient of the marketing management process is insightful, ________

marketing strategies and plans that can guide marketing activities.
a. creative
b. measurable
c. macro
d. micro
e. niche
Answer: a Page: 35 Level of difficulty: Medium

2. According to a chapter story about H&M clothing stores, H&M is able to put
products out quickly and inexpensively by all of the following EXCEPT ________.
a. having few middlemen and owning no factories
b. buying large volumes
c. having extensive experience in the clothing industry
d. having a great knowledge of which goods should be bought from which markets
e. having total control of its distribution channel from the time the goods are
produced until the time they are sold
Answer: e Page: 36 Level of difficulty: Hard

3. The task of any business is to deliver ________ at a profit.

a. customer needs
b. products
c. customer value
d. products and services
e. improved quality
Answer: c Page: 36 Level of difficulty: Medium

4. In a hypercompetitive economy such as ours, a company can win only by fine-tuning

the value delivery process and choosing, providing, and ________ superior value.
a. communicating
b. selecting target markets with
c. composing
d. developing
e. researching
Answer: a Page: 36 Level of difficulty: Medium

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5. The traditional view of marketing is that the firm makes something and then
________ it.
a. markets
b. sells
c. distributes
d. prices
e. services
Answer: b Page: 36 Level of difficulty: Easy

6. Today, the “mass-market” is actually splintering into numerous ________, each with
its own wants, perceptions, preferences, and buying criteria.
a. micromarkets
b. market targets
c. macromarkets
d. customer cliques
e. demographic units
Answer: a Page: 37 Level of difficulty: Medium

7. The first phase of the value creation and delivery sequence is ________ that
represents the “homework” marketing must do before any product exists.
a. choosing the value
b. market research
c. target marketing
d. service consideration
e. projective thinking
Answer: a Page: 37 Level of difficulty: Medium

8. The last step in the value creation and delivery sequence is ________ the value where
the sales force, sales promotion, advertising, and other communication tools
announce and promote the product.
a. developing
b. distributing
c. communicating
d. reversing
e. researching
Answer: c Page: 37 Level of difficulty: Medium

9. The Japanese have refined the value delivery process to include a component that
emphasizes ________.
a. zero servicing
b. zero customer feedback time
c. zero promotion
d. zero dependency on intermediaries
e. zero marketing costs
Answer: b Page: 38 Level of difficulty: Medium

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10. The ________ is a tool for identifying ways to create more customer value.
a. value chain
b. customer survey
c. brand loyalty index
d. promotion channel
e. supplier database
Answer: a Page: 38 Level of difficulty: Easy

11. The ________ identifies nine strategically relevant activities that create value and
cost in a specific business.
a. value proposition
b. value chain
c. mission statement
d. annual report
e. manager’s log
Answer: b Page: 38 Level of difficulty: Medium

12. The ________ in the value chain cover the sequence of bringing materials into the
business (inbound logistics), converting them into final products (operations),
shipping out final products (outbound logistics), marketing them (marketing and
sales), and servicing them (service).
a. operations process
b. manufacturing process
c. primary activities
d. secondary activities
e. tertiary activities
Answer: c Page: 38 Level of difficulty: Medium

13. Procurement, technology development, human resource management, and firm

infrastructure are handled in certain specialized departments and are called ________.
a. materials handling
b. support activities
c. inventory activities
d. primary activities
e. benchmark activities
Answer: b Page: 38 Level of difficulty: Hard

14. The firm should estimate its competitors’ costs and performances as ________
against which to compare its own costs and performance.
a. competition
b. standards
c. challenges
d. benchmarks
e. moveable standards
Answer: d Page: 38 Level of difficulty: Easy

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15. The firm’s success depends not only on how well each department performs its work,
but also on how well the various departmental activities are coordinated to conduct
________.
a. core strategies
b. satellite businesses
c. core values
d. core business processes
e. core technologies
Answer: d Page: 38 Level of difficulty: Medium

16. With respect to core business processes, all the activities involved in gathering market
intelligence, disseminating it within the organization, and acting on the information is
referred to as the ________.
a. market sensing process
b. market research process
c. target marketing process
d. market pulse process
e. deployment process
Answer: a Page: 38 Level of difficulty: Medium

17. With respect to the core business processes, all the activities involved in researching,
developing, and launching new high-quality offerings quickly and within budget are
referred to as the ________.
a. new product process
b. new offering realization process
c. product development process
d. product launch process
e. return on investment process
Answer: b Page: 38 Level of difficulty: Hard

18. With respect to the core business processes, the ________ is considered to be all the
activities involved in defining target markets and prospecting for new customers.
a. customer acquisition process
b. customer relationship management process
c. fulfillment management process
d. customer prospecting process
e. customer equity process
Answer: a Page: 38 Level of difficulty: Medium

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19. A good way to describe the ________ would be discuss all the activities involved in
building deeper understanding, relationships, and offerings to individual customers.
a. customer acquisition process
b. customer relationship management process
c. customer prospecting process
d. customer fulfillment management process
e. customer equity process
Answer: b Page: 38 Level of difficulty: Medium

20.The collaborator’s ________ involves horizontal partnerships, where companies

choose partners based on their ability to exploit related market opportunities, and
vertical partnerships, where companies choose partners based on their ability to serve
their value creation.
a. resource space
b. competency space
c. cognitive space
d. rational space
e. service space
Answer: a Page: 41 Level of difficulty: Medium

21. Business realignment may be necessary to maximize core competencies. Which of the
following would be one of the steps in this realignment process?
a. Reviewing all macro relationships.
b. Reviewing global outreach projections.
c. Redefining the business concept (the “big idea”).
d. Reviewing successes from e-commerce (if any).
e. Revamping the ethics statement.
Answer: c Page: 41 Level of difficulty: Medium

22. ________ allows the company to discover who its customers are, how they behave,
and what they need or want. It also enables the company to respond appropriately,
coherently, and quickly to different customer opportunities.
a. Network management
b. Strategic management
c. Marketing management
d. Customer relationship management
e. Total quality management
Answer: d Page: 41 Level of difficulty: Medium

23. To respond effectively and provide value delivery, the company requires ________ to
integrate major business processes (e.g., order processing, general ledger, payroll, and
production) within a single family of software modules.
a. human resource management
b. internal auditing management
c. internal resource management
d. strategic management

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e. marketing management
Answer: c Page: 41 Level of difficulty: Hard

24. With respect to value delivery, ________ allows the company to handle complex
relationships with its trading partners to source, process, and deliver products.
a. a value matrix
b. a global distribution policy
c. a business development strategy
d. business partnership management
e. total quality management
Answer: d Page: 41 Level of difficulty: Medium

25. Successful marketing requires having capabilities such as understanding ________,

creating customer value, delivering customer value, capturing customer value, and
sustaining customer value.
a. customer loyalty
b. customer perks
c. customer retention
d. customer value
e. customer benefits
Answer: d Page: 41 Level of difficulty: Easy

26. According to a McKinsey research study, which of the following is one of the main
challenges that marketing must face in the twenty-first century?
a. The threat of ethics-based lawsuits.
b. Doing more with less.
c. Hostile takeover attempts.
d. Increasing control by big government.
e. Being independent of the distribution process.
Answer: b Page: 42 Level of difficulty: Medium

27. Strategic planning in the twenty-first century calls for action in three key areas.
Which of these key areas deals specifically with devising a long-term game plan for
achieving long-run objectives?
a. Creating a viable business opportunity.
b. Producing a strategic fit.
c. Developing an investment portfolio.
d. Expanding core competencies.
e. Establishing a strategy.
Answer: e Page: 42 Level of difficulty: Medium

28. Most large companies consist of four organizational levels: the ________, the
division level, the business unit level, and the product level.
a. board of director level
b. major stakeholder level
c. management team level

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d. corporate level
e. strategic level
Answer: d Page: 43 Level of difficulty: Easy

29. The ________ is the central instrument for directing and coordinating the marketing
effort.
a. strategic plan
b. marketing plan
c. tactical plan
d. customer value statement
e. corporate mission
Answer: b Page: 43 Level of difficulty: Medium

30. Another way to describe a value delivery network (partnering with specific suppliers
and distributors) is to call it a ________.
a. teamwork group
b. cabal
c. domestic power center
d. link to relationships
e. supply chain
Answer: e Page: 39 Level of difficulty: Easy

31 . The key to utilizing organizational core competencies is to ________ that make up

the essence of the business.
a. make the competencies pay for themselves
b. own all intermediaries who come in contact with your goods and services
c. own and nurture the resources and competencies
d. emphasize global promotions
e. segment workforces
Answer: c Page: 39 Level of difficulty: Hard

32. We can say that a ________ has three characteristics: (1) It is a source of competitive
advantage in that it makes a significant contribution to perceived customer benefits,
(2) it has applications in a wide variety of markets, and (3) it is difficult for
competitors to imitate.
a. core competency
b. business strategy
c. core technology
d. strategic business unit
e. winning strategy
Answer: a Page: 39 Level of difficulty: Medium

33. Core competencies tend to refer to areas of special technical and production expertise,
where ________ tend to describe excellence in broader business processes.
a. process benchmarks
b. distinctive capabilities

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c. core business values

d. value statements
e. mission statements
Answer: b Page: 40 Level of difficulty: Medium

34. George Day sees market-driven organizations as excelling in three distinctive

capabilities: ________, customer linking, and channel bonding.
a. target marketing
b. market research
c. fulfilling customer needs
d. market sensing
e. customer service relationships
Answer: d Page: 40 Level of difficulty: Medium

35. Competitors find it hard to imitate companies such as Southwest Airlines, Dell, or
IKEA because they are unable to copy their ________.
a. product innovations
b. distribution strategy
c. pricing policies
d. activity systems
e. logistics system
Answer: d Page: 40 Level of difficulty: Hard

36. One conception of holistic marketing views it as “integrating the value exploration,
________, and value delivery activities with the purpose of building long-term,
mutually satisfying relationships and co-prosperity among key stakeholders.”
a. value creation
b. value proposition
c. value management
d. value research
e. value chain
Answer: a Page: 40 Level of difficulty: Hard

37. Holistic marketers achieve profitable growth by expanding customer share,

________, and capturing customer lifetime value.
a. undermining competitive competencies
b. building customer loyalty
c. milking the market for product desires
d. renewing a customer base
e. inspecting all market share data
Answer: b Page: 40 Level of difficulty: Medium

38. The holistic marketing framework is designed to address three key management
questions. Which of the following is one of those questions?
a. Value claims—how does the company deal with value erosion?
b. Value proposition—how can value propositions be made profitable?

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c. Value chain—are there weak links in the company’s value chain

d. Value network—how can a company effectively network?
e. Value exploration—how can a company identify new value opportunities?
Answer: e Page: 41 Level of difficulty: Hard

39. The customer’s ________ reflects existing and latent needs and includes dimensions
such as the need for participation, stability, freedom, and change.
a. competence space
b. resource space
c. emotional space
d. relationship space
e. cognitive space
Answer: e Page: 41 Level of difficulty: Medium

40. All corporate headquarters undertake four planning activities, the first of which is
________.
a. defining the corporate mission
b. establishing strategic business units and assigning resources (SBUs)
c. assigning resources to each SBU
d. assessing growth opportunities
e. understanding target markets
Answer: a

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