CHAPTER 20 Marketing Strategy: How it all Fits Together

TRUE/FALSE QUESTIONS
Answer whether the following statements are true or false

3 Undertake a thorough situation analysis

1. Heinz recognized a marketplace opportunity for coloured ketchup. This opportunity is also know as a strategic window.
true
false

4 Select strategic alternatives to match the market situation

2. An example of a "threat" which a tobacco manufacturer could use in its SWOT analysis could include impending legislation that would lessen the amount of advertising tobacco companies can do.
true
false

3. The basic strategy for a cash is to maintain market dominance by being the price leader and by making technological improvements in the product.
true
false

5 Build a marketing strategy based on customer value

4. Frito-Lay's Stuffers cheese-filled snacks had a low growth potential and eventually left the marketplace. This product is referred to as a problem child in the SBU matrix.
true
false

5. The first step in the marketing strategic planning process for the owner of Joy's Jump Ropes should be to formulate the marketing mix.
true
false

7 Implement, evaluate, and control the marketing plan

6. The control process actually begins while planning is taking place.
true
false

7. A marketing audit is a control device used primarily by large corporations to study past performance.
true
false

MULTIPLE-CHOICE QUESTIONS
Select the response that best answers the question, and write the corresponding letter in the space provided.

1 Undertake the strategic market planning that leads to the formal, written marketing plan

8. If Plan-O-Co is proceeding through the decision-making phases involved in the strategic planning process, which of the following activities is NOT being performed?

a. defining the business mission
b. conducting a situation analysis
c. developing strategic alternatives
d. designing a marketing information system to solve specific problems
e. establishing strategic business units

9. Consult-Me Consultants, Inc., has recently been engaged in several special meetings where issues such as business mission, situation analysis, market and growth alternatives, and implementation approaches have been discussed. Consult-Me is apparently engaged in:
a. target market planning
b. writing the mission statement
c. the strategic planning processes
d. business analysis
e. strategic contingency planning

10. Frito-Lay defines its business as "snack-food" rather than just "corn chips." This is an example of:
a. a marketing mix strategy
b. a mission statement
c. quantifiable goals
d. a financial statement
e. organizational accomplishment

11. Anja Lang, the senior vice president of Gardener Products, Ltd. is in the process of developing Gardener's organizational mission statement. Which of the following factors should she consider when developing such a mission statement?
a. What benefits do present customer need and want
b. What benefits will potential customers need and want
c. What existing environmental conditions will influence the choices made in the future by Gardener Products, Ltd
d. What anticipated environmental conditions will influence the choices made in the future by Gardener Products, Ltd
e. All of the above should be considered by Ms. Lang

12. By defining its business as "running department stores" instead of "providing a range of products and services that deliver value to Canadian families," Sears was engaging in:
a. market segmentation
b. marketing myopia
c. market development
d. strategic planning
e. product differentiation

13. A high tech company has the business mission of "providing high quality products at a fair price to customers." This mission statement
a. is an example of marketing myopia.
b. is too broad of a statement to be of use in serving customers.
c. could stifle creativity in discovering opportunities to serve customers.
d. is not sincere enough.
e. does not meet customer needs.

14. AT&T sells many products and services in addition to telephones. Some of these include computers, modems, fax machines, and a variety of business and home long-distance telephone services. How would this be best justified in the strategic planning process?
a. New business units are needed to continue growth.
b. Local delivery has high market attractiveness.
c. Diversification is needed to survive.
d. This mission statement recognizes the firm as a communications company, not just a telephone manufacturer.
e. It is more efficient to produce a wide variety of products.

15. Pepsico is a large conglomerate that has separate subsidiaries called Pepsi-Cola (soft drinks), Tropicana (juices), Pepsi Bottling, and Frito-Lay (snack foods). Each of these subsidiaries has its own functional departments, its own planning, its own financial goals, and its own target markets. These subsidiaries may also be called
a. product market niches
b. diversified divisions
c. strategic business units
d. strategic alliances
e. heterogeneous elements

4 Select strategic alternatives that match the market situation

16. The Organic Food Corp. has used a system to classify its various subsidiaries or divisions to determine the future expected cash contributions and the future expected cash requirements for each division. The divisions have been designated as cash cows, dogs, stars, and problem children. Organic Foods is using:
a. the portfolio matrix
b. market share analysis
c. response functions
d. the market attractiveness matrix
e. the company strength matrix

17. The baking products division of Basic Foods, Inc., is the market leader in a mature and low-growth market. The baking products division generates more dollars than is required in order to maintain market share, and in portfolio matrix terms it is known as Basic Food's:
a. green light
b. cash cow
c. star
d. dog
e. spotlight

18. In its portfolio of business subsidiaries, Brenda's Craft Shoppe has three units that are showing rapid growth but poor profit margins. Apparently, everything about these units demands more and more additional cash. In the Boston Consulting Group's portfolio matrix, these units would be classified as:
a. dogs
b. cash cows
c. problem children
d. stars
e. leeches

19. A local private college has been offering an accounting program for several years. The program has a large but declining enrollment, and the program represents the largest income earner for the business division. The recommended strategic option is to:
a. cultivate
b. divest
c. hold
d. harvest
e. build

20. Ice Cream Emporium has a moderate market share with little growth opportunity in a price-competitive market. Its financial resources are adequate, and it is returning a medium-level profit. In the market attractiveness/company strength matrix approach, the business should:
a. be maintained unless attractiveness begins to slip
b. bypass the largest competitors
c. be divested
d. require that market attractiveness be expressed quantitatively
e. make a large investment in the business

8 Identify several techniques that help make strategic planning effective

21. Effective strategic planning requires:
a. a General Electric planning matrix
b. management to stay out of the process
c. a designated single time frame during the year
d. the planner to challenge existing company assumptions
e. a stringent and narrow mission statement for guidelines

22. Noah, the owner of a hobby store, is concerned that his employees are not seriously embracing the marketing concept. You are his friend and a marketing expert. You would suggest all of the following ideas EXCEPT:
a. a clear declaration of intent and support for the new policies by Ethan
b. an increased authority for individual employees to make customer-related decisions as problems occur
c. getting everyone who will be affected by changes in policies and procedures involved in the planning process
d. slowly implementing new policies that encourage a focus on the customer
e. concentrating on creating a specific marketing department focused on this problem