Exam

N ame___________________________________

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

1) Which of the following involves adapting a firm to take advantage of opportunities in its constantly 1)
changing environment?
A) annual planning
B) media planning
C) strategic planning
D) short- range planning
E) long- range planning

2) When a firm develops and maintains a strategic fit betw een its goals and capabilities, it is 2)
performing ________.
A) mission planning
B) business- portfolio planning
C) values planning
D) operations planning
E) strategic planning

3) Which of the following is the first step in strategic planning? 3)

A) identify threats and w eaknesses
B) set objectives and goals
C) develop the business portfolio
D) define the company mission
E) plan marketing strategies

4) Which of the following is N OT a step in the strategic planning process? 4)

A) planning marketing and other functional strategies
B) designing the business portfolio
C) setting company objectives and goals
D) evaluating all members of the value chain
E) defining the company mission

5) Which of the follow ing provides an answ er to these questions: What is our business? Who are our 5)
customers? What do our customers value? What should our business be?
A) a business portfolio
B) a mission statement
C) operational strategies
D) marketing and functional strategies
E) objectives and goals

6) ________ should be market oriented and defined in terms of ________. 6)

A) Objectives; competitors' threats
B) Strategic plans; company needs
C) Mission statements; customers' needs
D) Annual plans; product needs
E) Long- range plans; company needs

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 7) A ll of the follow ing are accurate guidelines for a company's mission statement EXCEPT w hich one? 7)
A) A mission statement should be narrow .
B) A mission statement should emphasize the company's strengths in the marketplace.
C) A mission statement should be specific.
D) A mission statement should be realistic.
E) A mission statement should motivate employees.

8) A company's mission statement serves as a statement of ________. 8)

A) fact
B) purpose
C) values
D) employee commitment
E) financial goals

9) Which of the following is N OT a market- oriented business definition? 9)

A) "to bring aspiration and innovation to every athlete in the world"
B) "to make the Internet buying experience fast, easy, and enjoyable"
C) "to deliver low prices every day"
D) "to be the guardian of our customers' financial dreams"
E) "to sell tools and home repair and improvement items"

10) A ll of the following are examples of product- oriented mission statements, EXCEPT w hich one? 10)
A) "We provide online services."
B) "We run theme parks."
C) "We sell shoes."
D) "We rent hotel rooms."
E) "We sell lifestyle and self- expression; success and status; memories, hopes, and dreams."

11) Which of the following is the principle objective of a market- oriented mission statement? 11)
A) to satisfy basic supplier needs
B) to satisfy basic stockholder needs
C) to satisfy basic ow ner needs
D) to satisfy basic partnership needs
E) to satisfy basic customer needs

12) Revlon has clearly defined its "mission" of selling lifestyle and self- expression. In order for the firm 12)
to launch its strategic plan, the mission needs to next be turned into detailed ________ that guide
each level of the company.
A) supporting objectives
B) sets of promotional tools
C) sets of tactics
D) product mixes
E) sets of strategies

13) The collection of businesses and products that make up a company is called its ________. 13)
A) operational factor
B) mission statement
C) business portfolio
D) strategic plan
E) strategic business unit

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14) Which of the following can be a company division, a product line w ithin a division, or sometimes a 14)
single product or brand?
A) the BCG
B) a value delivery netw ork
C) a market
D) a PLC
E) an SBU

15) A fter management has identified the key businesses making up its company, w hat is the next step 15)
in portfolio analysis?
A) identifying SBUs
B) identifying businesses in w hich to invest
C) assessing the attractiveness of its SBUs
D) deciding w hether to harvest any businesses
E) completing short- range planning

16) The best known product portfolio planning method w as developed by ________. 16)
A) Philip Kotler
B) Harvard University
C) the Boston Consulting Group
D) James P. Hess
E) the SRI Consulting Firm

17) M ost portfolio analysis methods evaluate SBUs on two dimensions, namely ________ and 17)
________.
A) market grow th rates; profits
B) market share; strength of the SBU's position
C) market penetration; market development
D) market diversification; relative market share
E) market or industry attractiveness; strength of the SBU's position

18) In the Boston Consulting Group approach, ________ provides a measure of market attractiveness. 18)
A) market development
B) market penetration
C) relative market share
D) market grow th rate
E) market segmentation

19) In the Boston Consulting Group approach, ________ serves as a measure of company strength in 19)
the market.
A) market segmentation
B) market development
C) relative market share
D) market grow th rate
E) market diversification

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20) The BCG growth- share matrix classifies four types off SBUs. They are ________, ________, 20)
________, and ________.
A) market penetration; market development; product development; diversification
B) sales; market share; price; promotion
C) product; price; promotion; placement
D) stars; cash cow s; question marks; dogs
E) planning; implementing; leading; controlling

21) In the BCG approach, ________ are high- share, high- grow th businesses or products. They need 21)
heavy investment to finance rapid grow th. When their growth slow s dow n, they turn into
________.
A) stars; cash cow s
B) question marks; dogs
C) cash cow s; stars
D) stars; question marks
E) dogs; cash cows

22) ________ are low- grow th, high share businesses or products. They generate a lot of cash that the 22)
firm uses to pay its bills and support other SBUs that need investment.
A) Dogs
B) Cash cows
C) Stars
D) Cats
E) Question marks

23) In the BCG matrix, income from ________ can be used to help finance the company's question 23)
marks and stars.
A) dogs
B) cash cow s
C) overseas operations
D) low - share businesses
E) SBU revenues

24) The four possible strategies that can be pursued for each SBU are building, holding, ________, and 24)
________.
A) downsizing; expanding
B) developing; grow ing
C) harvesting; divesting
D) promoting; selling
E) diversifying; penetrating

25) Which of the following does N OT accurately reflect a problem w ith the BCG matrix approach? 25)
A) It is difficult to define SBUs and measure market share and grow th.
B) It can be costly to conduct.
C) It focuses on planning for the future.
D) It can be time consuming to implement.
E) It focuses on classifying current businesses.

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26) Unlike strategic- planning efforts of the past, w hich w ere conducted primarily by senior managers, 26)
today's strategic planning is ________.
A) decentralized
B) product oriented
C) limitation- free
D) centralized
E) short- term oriented

27) To enter new global markets, a company like BA SF can create new local partnerships w ithin 27)
targeted countries. These are examples of ________.
A) diversification
B) broad strategies for growth
C) value chains
D) brand experiences
E) product development

28) Which department in a company carries the primary responsibility for achieving profitable 28)
grow th?
A) human resources
B) accounting
C) operations
D) marketing
E) product development

29) Which of the following is a useful tool for identifying grow th opportunities? 29)
A) the BCG matrix
B) the product/market expansion grid
C) the value delivery netw ork
D) the value chain
E) the business portfolio

30) M aking more sales to current customers w ithout changing a firm's products is ________. 30)
A) market development
B) market attractiveness
C) diversification
D) market penetration
E) product development

31) Tim Hortons works to train people w ho come into Tim H ortons first thing in the morning for coffee 31)
and breakfast to return several times during the rest of the day. This effort by Tim Hortons
management is an example of ________.
A) market development
B) market penetration
C) product adaptation
D) product development
E) diversification

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32) While a valuable planning tool, a problem with using the BCG matrix centres is that it focuses on 32)
________
A) the future instead of the present
B) the present instead of the future
C) financial issues instead of the customer
D) the past instead of the present
E) the customer instead of suppliers

33) A common practice among marketers is to identify and develop new markets for their existing 33)
products. This practice is called ________.
A) market penetration
B) dual adaptation
C) product development
D) market development
E) market skimming

34) If Tim Hortons w ere to leverage its strong brand name onto products like sportswear that fit w ith 34)
its friendly, relaxed image, this w ould represent which strategy for grow th?
A) market development
B) diversification
C) partner development
D) market penetration
E) product development

35) Which of the following entails reducing the business portfolio by eliminating products that no 35)
longer fit the company's overall strategy?
A) market segmentation
B) the BCG approach
C) market redesign
D) product line extension
E) dow nsizing

36) Which of the follow ing is N OT a reason that a firm might w ant to abandon products or markets? 36)
A) The market has changed, making some of the products less profitable.
B) The economic environment is showing signs of recovery.
C) The firm has grown too rapidly.
D) The firm has entered areas in w hich it does not have expertise.
E) The firm has not properly researched foreign markets which it has entered.

37) Each department in a company that carries out value- creating activities can be thought of as a link 37)
in the company's ________.
A) market development
B) value chain
C) business portfolio
D) product development
E) value delivery netw ork

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38) Jack Welch, former CEO at General Electric, said that "Companies can't give job security, only 38)
________ can."
A) development
B) good strategy
C) customers
D) grow th
E) efficiency

39) M ultinationals like H onda M otor Co. and Wal- Mart stores have designed programs to w ork 39)
closely w ith their suppliers to help them reduce their costs and improve quality. This illustrates the
importance of an efficient ________.
A) business portfolio
B) value delivery netw ork
C) value chain
D) low - cost operator
E) product mix

40) Which of the follow ing is the marketing logic by which a company hopes to achieve profitable 40)
customer relationships?
A) a consistent product mix
B) marketing strategy
C) differentiation
D) price
E) the value delivery netw ork

41) Lucy Ortiz is preparing a Pow erPoint presentation of the marketing process to show at a sales 41)
meeting. ________ should appear in the centre of her diagram depicting marketing strategies and
the marketing mix.
A) Sales goals
B) Customer retention rates
C) Competitors
D) Company objectives
E) Customer value and relationships

42) A sound marketing strategy begins with which of the follow ing? 42)
A) promotion
B) SWOT analysis
C) positioning
D) differentiation
E) customer analysis

43) Your firm is attempting to divide up the total market to determine the best segments it can serve. 43)
Which is the correct order of doing so?
A) market positioning, market segmentation, target marketing
B) market segmentation, market positioning, target marketing
C) market segmentation, target marketing, market positioning
D) target marketing, market positioning, market segmentation
E) mass marketing, demographic segmentation, psychographic segmentation

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44) The process of customer- driven marketing involves w hich of the following? 44)
A) market segmentation; target marketing; differentiation; positioning
B) analysis; targeting; implementation; control
C) problem identification; information search; decision; implementation
D) marketing analysis; planning; implementation; feedback
E) product; price; promotion; adaptation

45) Which of the follow ing is the process of dividing a market into distinct groups of buyers w ith 45)
different needs, characteristics, or behaviours?
A) differentiation
B) market targeting
C) market segmentation
D) marketing strategy
E) positioning

46) Your new employer has asked you, as a new marketing graduate, to develop a group of potential 46)
customers who might respond in a similar w ay to a given set of marketing efforts. You have been
asked to develop a(n) ________.
A) market segment
B) undefined niche
C) target market
D) market strategy
E) market

47) Which of the follow ing involves evaluating each market segment's attractiveness and selecting one 47)
or more segments to enter?
A) market targeting
B) market segmentation
C) positioning
D) the market mix
E) differentiation

48) Which of the following is the place a product occupies in the consumer's mind relative to 48)
competition?
A) position
B) market segmentation
C) market targeting
D) placement
E) product promotion

49) Effective positioning begins w ith ________ the company's marketing offer in order to give 49)
consumers more perceived value.
A) aligning
B) differentiating
C) placing
D) promoting
E) pricing

50) Which of the four Ps describes the goods- and- services combination the company offers to the 50)
target market?
A) price B) package C) product D) place E) promotion

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51) In the four Ps of the marketing mix, design, packaging, services, and variety all fall under the 51)
category of ________.
A) price B) product C) position D) promotion E) place

52) Today the four Ps are compared to the four Cs. Product and place are called ________ and 52)
________, respectively.
A) communication; customer solution
B) customer solution; convenience
C) communication; convenience
D) customer cost; convenience
E) convenience; customer solution

53) In the marketing management functions, a SWOT analysis should ________ a marketing plan. 53)
A) evaluate
B) follow
C) take priority over
D) coincide with
E) precede

54) In a basic SWOT analysis the "T" stands for ________. 54)
A) threats B) tangible C) timing D) trust E) trade

55) In a basic SWOT analysis, the "S" stands for ________. 55)
A) situation
B) strategy
C) strengths
D) satisfactions
E) solutions

56) In SWOT analysis, w hich of the follow ing would be considered a strength? 56)
A) favourable factors in the environment
B) internal resources
C) trends in the market
D) factors that challenge the company's performance
E) internal limitations

57) In SWOT analysis, w hich of the follow ing refers to factors in the external environment? 57)
A) opportunities
B) w eaknesses
C) strengths
D) strategies
E) trends

58) The main section of the marketing plan presents a detailed ________ analysis of the current 58)
marketing situation.
A) competitor
B) when, w here, how
C) economic
D) who, when, w here
E) SWOT

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59) A marketing plan begins w ith an executive summary, w hich quickly overview s goals and 59)
________.
A) recommendations
B) obstacles
C) controls
D) promotions
E) budgets

60) According to the textbook, your boss is most likely referring to ________ when she mentions "doing 60)
things right."
A) strategy
B) planning
C) implementation
D) efficiency
E) objectives

61) IBM has its sales and marketing people assigned to markets in specific countries, regions, and 61)
districts. This is an example of w hich type of marketing organization?
A) product
B) functional
C) divisional
D) psychographic
E) geographic

62) Which of the following is the most common approach to marketing organization? 62)
A) functional
B) geographic
C) product management
D) divisional
E) combination

63) Berman Electric, a chain of 18 appliance stores, has a marketing organization in w hich specialists 63)
head different marketing activities. What is this type of organization called?
A) market
B) geographic
C) organic
D) product
E) functional

64) M odern marketing departments are arranged in the follow ing w ays, EXCEPT w hich one? 64)
A) market management organization
B) geographic organization
C) product management organization
D) functional organization
E) strategic management organization

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65) The ________ organizational format w as first used by Procter and Gamble in 1929. 65)
A) geographic management
B) customer management
C) product management
D) market management
E) functional

66) The ________ organizational system's main advantage is that the company is organized around the 66)
needs of specific market segments.
A) product management
B) functional
C) vertical
D) geographic
E) market management

67) A n increasingly large number of firms are changing their organizational focus from ________ to 67)
________.
A) geographic management; functional management
B) global management; regional management
C) product management; geographic management
D) product management; functional management
E) brand management; customer management

68) Evaluating the results of marketing strategies and plans and taking corrective action to ensure that 68)
objectives are attained is called ________.
A) marketing control
B) developmental control
C) strategic control
D) operating control
E) efficiency

69) The marketing control process entails the follow ing steps in order: setting goals, ________, 69)
evaluating performance, and ________.
A) evaluating goals; measuring performance
B) taking corrective action; measuring performance
C) achieving goals; measuring performance
D) measuring performance; taking corrective action
E) taking corrective action; follow ing up

70) Which of the follow ing is N OT a step in the marketing control process? 70)
A) measuring performance
B) setting goals
C) evaluating the causes of gaps between expected and actual performance
D) defining the mission
E) taking corrective action

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 71) Ensuring that the company achieves the sales, profits, and other goals set out in its annual 71)
marketing plan is the purpose of ________.
A) ROM I
B) operating control
C) a marketing audit
D) marketing control
E) strategic control

72) Which of the follow ing involves looking at w hether a company's basic strategies are w ell matched 72)
to its opportunities?
A) marketing control
B) operating control
C) portfolio analysis
D) strategic control
E) ROM I

73) Which of the following is a comprehensive and systematic analysis of a company's environment, 73)
objectives, strategies, and activities that is conducted by an outside and objective party?
A) SWOT analysis
B) a marketing plan
C) a marketing audit
D) a marketing mix analysis
E) a portfolio analysis

74) Which of the follow ing measures the profits generated by investments in marketing activities? 74)
A) marketing ROI
B) a budget
C) a marketing audit
D) an executive summary
E) SWOT analysis

75) Which of the follow ing w ould N OT be useful in determining marketing ROI? 75)
A) SWOT analysis
B) customer equity
C) market share
D) brand awareness
E) a marketing dashboard

TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false.

76) M ission statements should be realistic and general in nature. 76)

77) ABC Fortunes has just developed a formal statement of its purpose. This firm has put together a 77)
mission statement.

78) Mission statements should both emphasize the company's strengths in the marketplace and be 78)
motivating.

79) A t Zellers, "w e offer products and services that deliver superior style and value to Canadians.," is a 79)
product- oriented business definition.

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80) A t N ike, "w e sell athletic shoes and apparel" is a market- oriented business definition. 80)

81) A firm's mission should alw ays be stated as making more sales or profits. 81)

82) The major activity in strategic planning is strategic business unit planning, w hereby management 82)
evaluates the products and businesses making up the company.

83) An SBU is a company division or product line, never a single product or brand. 83)

84) The purpose of strategic planning is to find w ays in w hich your company can best use its strengths 84)
to take advantage of attractive opportunities in the environment.

85) In the BCG matrix, "dogs" are low- grow th businesses and products that do not generate enough 85)
cash to maintain themselves.

86) Question marks in the BCG matrix require a lot of cash to hold their share, let alone increase it. 86)

87) The grow th strategy of diversification involves offering modified or new products to current 87)
markets.

88) When an organization identifies and develops new markets for its current products and services, it 88)
is engaged in market development.

89) When a firm finds products or businesses that no longer fit its overall strategy, it must carefully 89)
milk, harvest, or better develop them.

90) In today's marketplace, competition increasingly takes place betw een entire value delivery 90)
netw orks rather than betw een individual competitors.

91) To improve its value delivery netw ork, a company needs to examine the value chains of its 91)
suppliers and distributors.

92) Mandros International Foods evaluates each market segment's attractiveness and selects one or 92)
more segments to enter w hen considering adding new lines of imported foods. M andros is engaged
in selective marketing.

93) The image of a product in the minds of consumers is called market segmentation. 93)

94) A market segment consists of consumers w ho respond in different w ays to a given set of marketing 94)
efforts.

95) Holiday Inn has divided the total customer market into smaller segments and selected the most 95)
promising segments. Deciding what position it w ants to occupy in these segments is called
targeting.

96) When a company positions its product, it should first identify possible customer value differences 96)
within a market segment that could be the basis of a competitive advantage for the product.

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 97) The marketing mix consists of product, price, place, positioning, and promotion. 97)

98) Guided by marketing strategy, the company designs a marketing mix made up of factors under its 98)
control: product, price, place, and promotion.

99) One valid criticism of the four Ps concept is that services are not considered. 99)

100) The four Ps concept takes the seller's view of the market. 100)

101) The four marketing management functions are: analysis, planning, implementation, and control. 101)

102) A company can divest an SBU by selling it or phasing it out and using the resources elsew here. 102)

103) A brief summary of the main goals and recommendations of the plan belongs in the Objectives and 103)
Issues section of a marketing plan.

104) The CM O heads up the company’s entire marketing operation and represents marketing on the 104)
company’s top management team.

105) The marketing audit covers all major marketing areas of a business, not just a few 105)
trouble spots.

106) In measuring financial ROI, both the R and the I are uniformly measured in dollars. But there is as 106)
of yet no consistent definition of marketing ROI.

ESSAY. Write your answer in the space provided or on a separate sheet of paper.

107) Define strategic planning. Discuss the steps involved.

108) What is business portfolio planning? Discuss how a company might use the Boston Consulting Group's product
portfolio analysis method.

109) Describe some of the problems w ith matrix approaches.

110) The BCG is a useful approach to evaluate current businesses. Describe a device that a firm could use to identify
future grow th opportunities.

111) What does the term "value- delivery netw ork" mean? Explain.

112) Define marketing strategy. Discuss the steps in formulating marketing strategy.

113) Explain w hy, according to the authors of your text, the four Ps concept of the marketing mix takes a seller's view
of the market, not the buyer's view . How should marketers consider the buyer's view ?

114) Define marketing planning. Briefly outline the major steps in a marketing plan.

115) M arketing departments are organized in several w ays. Discuss the most common forms of marketing
organizations.

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 116) Briefly discuss how marketers measure return on marketing investment, explaining w hy this figure can be
difficult to assess.

117) Discuss how Sun- Rype Products Ltd., headquartered in Kelow na, British Columbia, evolved through its use of
product- based and geographic segmentation.

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

118) NA SCAR is the number- one televised motorsport in Canada. It is a premier marketing 118)
organization that know s how to create customer value that translates into deep and lasting
________
A) market segments.
B) profit analysis
C) value chains,
D) customer relationships.
E) value delivery netw ork

119) Canadian Tire sells tools and home improvement products. The retailer defines its ________ as 119)
such: "to offer products and services to meet the everyday needs of Canadian families—today and
tomorrow ."
A) marketing development
B) value- delivery netw ork
C) business portfolio
D) strategy
E) mission

120) Google's mission statement could be, "to be the world's best search engine" , yet Google's actual 120)
statement is, "to organize the w orld’s information and make it universally accessible and useful."
This reflects the guideline that mission statements should be ________.
A) realistic
B) specific
C) narrow
D) market- oriented
E) motivating

121) A vendor for Ford M otor Company received the follow ing message from one of Ford's marketing 121)
managers: "A s w e move forw ard during the 21st century, Ford is committed to building profitable
customer relationships by creating more environmentally friendly cars and getting them to market
faster at low er costs." The marketing manager is referring to Ford's ________.
A) marketing strategy
B) mission statement
C) business portfolio
D) business objectives
E) marketing mix

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122) When the makers of a ballpoint pen state they are in the communication equipment business, they 122)
are defining their mission too ________.
A) broadly
B) specifically
C) futuristically
D) realistically
E) narrowly

123) Kimball Gardens is a company that operates as tw o distinct businesses: one that sells law n and 123)
garden products and one that markets booklets. Each business is called a ________.
A) strategic business unit (SBU)
B) star
C) cash cow
D) separate entity
E) business portfolio

124) The pharmaceuticals division of Omni Healthcare holds low market share in a high- grow th 124)
market. In order to increase market share, managers w ould be most likely to decide which of the
follow ing?
A) divest the SBU
B) use money from a cash cow to promote the pharmaceuticals division
C) diversify the pharmaceutical division
D) hold the pharmaceuticals division's share
E) implement a harvest strategy

125) Wal- M art, the world's largest retailer, has successfully launched its stores in M exico, Canada, the 125)
U.K., and Germany, and other nations. This is an example of how Wal- M art is pursuing ________
as a growth strategy.
A) product development
B) geographic market development
C) demographic market development
D) market penetration
E) diversification

126) Fence Patrol has developed an entirely new mounting system for chain link fences. Although they 126)
are a local company, through the acquisition of a distributor they now have the ability to market
their products nationw ide. Fence Patrol is most likely to be follow ing a ________ strategy.
A) market penetration
B) market development
C) diversification
D) product development
E) divesting

127) Tim Hortons might consider adding gas bars to complement its drive- through services. In that 127)
case, the company w ould be pursuing a ________.
A) product development strategy
B) downsizing strategy
C) market penetration strategy
D) product adaptation strategy
E) diversification strategy

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128) Acme, Inc., has slightly modified the production processes of its w idgets and gadgets in order to 128)
tap into the Eastern European market. Acme is likely following a ________ strategy.
A) market penetration
B) product development
C) market development
D) harvesting
E) diversification

129) Disney is identifying and developing new markets for its theme parks. Disney is exploring 129)
possibilities for ________.
A) market development
B) product development
C) harvesting
D) market penetration
E) diversification

130) For H yundai Corporation, customers w ho care about the price of a car and its operating economy 130)
make up one ________.
A) customer extension
B) market position
C) value network
D) market segment
E) value chain

131) Favorite M emories specializes in serving gift shoppers that major competitors overlook and ignore. 131)
Which of the following best describes Favorite M emories?
A) full market coverer
B) market challenger
C) market follow er
D) market seeker
E) market nicher

132) Saturn is "a different kind of company, different kind of a car"; the Hummer is "like nothing else." 132)
These statements reflect a firm's ________.
A) product portfolio
B) market positioning
C) strategy
D) niche
E) target markets

133) H arris, the marketing manager at a small sports retail chain, has conducted a marketing analysis. 133)
H e has investigated the company's internal resources and situational factors, as w ell as factors and
trends in the competitive sports retail chain market. Which of the following has Harris completed?
A) an executive summary
B) a SWOT analysis
C) a marketing plan
D) a business portfolio analysis
E) a marketing mix

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 134) Which of the following most accurately identifies a difference between a weakness and a threat in 134)
SWOT analysis?
A) A company is more able to change a threat than a w eakness.
B) A company can be more negatively affected by a threat than by a weakness.
C) A company can be more negatively affected by a weakness than by a threat.
D) A company is more able to change a weakness than a threat.
E) A company can more easily identify threats than w eaknesses.

135) Emerson Studios, a chain of 25 portrait stores in five states, has organized its marketing 135)
organization into groups headed by a sales manager, an advertising manager, and a
customer- service manager. What type of organization is this?
A) geographic
B) market
C) customer
D) product
E) functional

136) Juanita Castro is looking at w hether her company's strategies are w ell matched to its opportunities. 136)
Juanita is utilizing ________.
A) operating control
B) SWOT analysis
C) marketing control
D) strategic control
E) a marketing audit

137) As Starbucks continues to grow, it is faced w ith a myriad of challenges and surprises during the 137)
implementation of marketing plans. H ence, the marketing department must practice constant
________.
A) performance analysis
B) corrective action
C) environmental scanning
D) customer management
E) marketing control

SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.

138) Why should a mission statement be market oriented instead of product or technology 138)
oriented?

139) Why should a mission statement be "motivating" instead of stated in terms of sales or 139)
profits?

140) What is a strategic business unit (SBU) and how is it involved in a business portfolio 140)
analysis?

141) Into w hat BCG quadrant does a high- share, high- grow th SBU fall? 141)

142) What type of strategy should a company use to manage its cash cow s and question marks? 142)

143) How might the BCG matrix represent a life cycle? 143)

18
144) H ow might Party Planning Paradise, a company that sells a w ide range of party supplies 144)
for all occasions, implement a market development strategy?

145) According to the product/market expansion grid, w hat strategy w ould a fast- food 145)
hamburger restaurant follow if it offered a salad bar option during lunch hours?

146) Into w hat quadrant of the product/market expansion grid w ould a "new and improved" 146)
product fall?

147) H ow are partner relationship management and the value chain related? 147)

148) Explain market targeting and the guidelines marketers should use w hen choosing w hat 148)
markets to enter.

149) What makes Ferrari a market nicher? 149)

150) What role does the marketing mix play in positioning? 150)

151) Why is marketing analysis such an important part of marketing management? 151)

152) Why are many marketers today using customer- centred measures of marketing ROI? 152)

153) Why is it more strategic for Canadian Tire's mission to be about meeting the everyday 153)
needs of Canadians instead of simply to sell tools and home improvement items?

154) What are some w ays in w hich Tim H ortons' management has focused on product 154)
development as a grow th strategy?

155) What is the role of a company's Chief Marketing Officer (CM O)? 155)

156) What is the purpose of the Threats and Opportunities Analysis section in a marketing 156)
plan?

157) What is meant by a "marketing dashboard"? 157)

19
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.

Refer to the scenario below to answer the following questions.

Fun- Spot Fun Park began as a small amusement park in 1985. With nothing more than a merry- go- round, a slide, pony
rides, and an ice cream stand, Fun- Spot grew into a popular family attraction with 20 rides, a restaurant, and an outdoor
performing arts theater.
"M y w ife, Gail, and I didn't know what we w ere getting into," commented Ron H art, the ow ner. "We just knew that
w eekenders coming to the lakes in our rural area represented an untapped market."
Today, thousands of visitors flock to Fun- Spot: families, children of all ages, and even senior citizens w ho enjoy strolling
through the gardens and arbor.
"There's something here for everyone," Gail H art said w ith a smile. "Dozens of companies hold annual company picnics
here. We have welcomed class field trips. A nd w e even had one wedding here at the park!"
"H ere's the funny thing," Ron chimed in. "We really don't know w hy w e've been so successful! There is nothing else like
Fun- Spot Fun Park in the area. We w ere just lucky."
"I think it's the ambience of the park that has brought so many visitors," Gail added. We provide a ‘total package' of
entertainment. Plus, w e try to change our rides and various attractions from time to time."
Ron and Gail Hart admitted that making every visitor happy is a priority. "That has alw ays been our philosophy," they
said. "Like it says on the entrance to the park, 'We're here to make you happy!' And w e've alw ays been able to deliver on that
because w e've never allow ed ourselves to grow too big too quickly."

158) Fun- Spot's mission is ________. 158)

A) product- oriented
B) too focused on profits
C) too specific
D) technology- oriented
E) market- oriented

159) Into w hich quadrant of the BCG matrix does Fun- Spot fall? 159)
A) dog
B) question mark
C) profit centre
D) diversification
E) star

160) Ron and Gail plan to lower prices in an effort to encourage customers to stay longer, visit more 160)
often, and spend more money during each visit. What type of strategy are Ron and Gail planning?
A) market penetration
B) diversification
C) product development
D) customer development
E) market development

161) Gail and Ron strive to provide new offerings and entertainment options for their visitors. What 161)
type of strategy is this?
A) market penetration
B) customer development
C) market development
D) product development
E) diversification

20
162) Which of the follow ing w ould be classified as an opportunity in a SWOT analysis of Fun Spot? 162)
A) A new luxury hotel is being constructed in the area, with the aim of luring more
high- spending families on vacation.
B) Fun Spot employees tend to be enthusiastic and young, projecting an image of fun and
vitality at Fun Spot.
C) Gail and Ron have paid off the mortgage on Fun Spot, significantly reducing their monthly
expenses.
D) Fun Spot plans to further diversify its offerings by beginning a tw o- w eek summer camp for
elementary school students.
E) A rival amusement park announces plans to open three new rides next season.

163) Fun- Spot has grow n into a popular family attraction w ith 20 rides, a restaurant, and an outdoor 163)
performing arts theater. These products and services make up Fun- Spot's _______
A) marketing plan.
B) delivery netw ork.
C) cash cow s.
D) value chain.
E) business portfolio.

164) Gail and Ron' amusement park serves families, seniors, corporations, and students. Fun- Spot has 164)
been very successful in meeting the distinct needs of individual _______.
A) cash cow s
B) market segments.
C) market niches
D) partners
E) businesses

165) Which of the follow ing scenarios w ould mean that Fun- Spot had become a market nicher? 165)
A) Fun- Spot adds a video game arcade to attract gamers.
B) Fun- Spot develops a promotion to attract college students every Friday.
C) A ctivities for families w ith young children are reduced.
D) The restaurant is closed and replaced with a food court.
E) The park is overhauled to meet only the needs of the physically disabled.

166) "Fun- Spot is the nearby get- aw ay that offers consistently fun, but ever- changing theatre, dining, 166)
and midway experience". This is an example of a ________ strategy.
A) proposition
B) market
C) value
D) vision
E) positioning

167) It takes the unified efforts of several departments at Fun- Spot to make the amusement park a 167)
success. The purchasing department, restaurant management, theatre group, and others all w ork
in harmony to deliver a superior product. This is an example of the benefits of a strong
A) value chain
B) value delivery netw ork
C) market segment
D) marketing ROI
E) diversification strategy

21
A nsw er Key
Testname: UN TITLED2

1) C
2) E
3) D
4) D
5) B
6) C
7) A
8) B
9) E
10) E
11) E
12) A
13) C
14) E
15) C
16) C
17) E
18) D
19) C
20) D
21) A
22) B
23) B
24) C
25) C
26) A
27) B
28) D
29) B
30) D
31) B
32) B
33) D
34) B
35) E
36) B
37) B
38) C
39) B
40) B
41) E
42) E
43) C
44) A
45) C
46) A
47) A
48) A
49) B
50) C
22
A nsw er Key
Testname: UN TITLED2

51) B
52) B
53) E
54) A
55) C
56) B
57) A
58) E
59) A
60) C
61) E
62) A
63) E
64) E
65) C
66) E
67) E
68) A
69) D
70) D
71) B
72) D
73) C
74) A
75) A
76) FA LSE
77) TRUE
78) TRUE
79) FA LSE
80) FA LSE
81) FA LSE
82) FA LSE
83) FA LSE
84) TRUE
85) FA LSE
86) TRUE
87) FA LSE
88) TRUE
89) FA LSE
90) TRUE
91) TRUE
92) FA LSE
93) FA LSE
94) FA LSE
95) FA LSE
96) TRUE
97) FA LSE
98) TRUE
99) FA LSE
100) FA LSE
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A nsw er Key
Testname: UN TITLED2

101) TRUE
102) TRUE
103) FA LSE
104) TRUE
105) TRUE
106) TRUE
107) The process of developing and maintaining a strategic fit betw een the organization's goals and capabilities and its
marketing opportunities is called strategic planning. A t the outset, beginning at the corporate level, each company
must define its overall purpose and mission. What is our business? Who is the customer? What do our customers
value? A nsw ers to these questions are crucial in w riting a clear mission statement. M ission statements need to be
carefully defined in terms of customer needs. Missions should be realistic, motivating, and fit the market environment.
Missions then lead to setting business and marketing objectives/goals in the planning process. This is follow ed by
decisions regarding what portfolio of businesses and products is best for the company and how much support to give
each one. N ext, each business and product develops detailed marketing and other functional strategies. In this step,
plans are draw n at the business unit, product, and market levels in support of company w ide plans.
108) A business portfolio is the collection of businesses and products that make up a company. Business portfolio planning
entails two steps. First, there is an analysis of the company's current business portfolio, follow ed by decisions about
w hat businesses should receive more, less, or no investment. Second, planners must shape the future portfolio by
developing strategies for growth and/or dow nsizing. The Boston Consulting Group matrix evaluates SBUs on tw o
important dimensions: the attractiveness of the SBU's market or industry grow th rate and the strength of the SBU's
position or relative market share in that market or industry. The grow th- share matrix defines four types of SBUs: stars,
cash cow s, question marks, and dogs. Once each SBU has been defined, a company can determine what role each w ill
play in the firm's future, using strategies of building, holding, harvesting, or divesting each SBU.
109) The BCG and other portfolio planning approaches can be difficult to execute, time consuming, and also costly to
implement. Defining SBUs and the measurement of relative market share and grow th can be a difficult task as well. A
serious flaw w ith these approaches is that, while they are helpful for classifying current businesses, they offer little or
no advice for future planning.
110) The product/market expansion grid is a useful device for identifying grow th opportunities in the future. There are four
strategies available to companies: market penetration, market development, product development, and diversification.
M arket penetration entails making more sales to current customers without changing products. M arket development
involves identifying and developing new markets for a company's products. N ew markets include demographic
groups and geographic regions, among others. Companies can also consider product development, offering modified
or new products to current markets. Diversifying companies might consider acquiring or starting new businesses
unrelated to their core competencies. H owever, diversifying too broadly can be detrimental in the long run.
111) For decades, marketers have traditionally created value to satisfy customer needs and w ants. Today, the manufacturer
or retailer needs to look beyond its ow n value chain and into the value chains of suppliers and distributors to create
value throughout the entire supply chain. M ore companies are partnering w ith other members of the supply chain to
improve the performance of the customer value- delivery netw ork. In fact, today competition takes place between
entire value delivery networks instead of between individual competitors.
112) The marketing logic by w hich a company hopes to achieve profitable relationships is called its marketing strategy.
M arketing strategy formulation entails four specific steps: market segmentation, market targeting, differentiation, and
positioning. The process of dividing a market into distinct groups of buyers with different needs, characteristics, or
behaviour is called market segmentation. M arket targeting involves evaluating each market segment's attractiveness
and selecting one or more segments to enter. A company should target segments in w hich it can profitably generate the
greatest customer value and sustain that value over time. Effective positioning begins w ith actually differentiating the
company's marketing offer so that it gives consumers greater value. Positioning is defined as creating a distinct image
of a product in the eyes of target consumers. A product's positioning should take advantage of a competitive
advantage w ithin the market target.

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113) In today's day and age of customer relationship marketing, the four Ps can be described as the four Cs from the
customer's point of view. In lieu of product, there is customer solution; that is, customers buy solutions to their
problems or look for value in products. Customers are more interested in the total costs of obtaining, using, and
disposing of a product. That is, customer cost replaces price in customer relationships. The place element of the
marketing mix focuses on convenience. Convenience in availability is the central focus of customers. Finally, customers
and marketers want tw o- way communication. M arketers should use the four Cs as a base for the four Ps of their
marketing mix.
114) M arketing planning involves deciding on marketing strategies that will help the company achieve its overall strategic
objectives. A detailed marketing plan is needed at the business, product, or brand level. An executive summary is the
first step in the plan. It contains a brief summary of the main goals and recommendations of the plan for management
review . The main section of the plan presents a detailed SWOT analysis of the current marketing situation, along w ith
potential threats and opportunities. The plan then states major objectives for the brand and outlines the specifics of a
marketing strategy for achieving them. In addition, action programs for implementing the marketing strategy along
with the details of a supporting marketing budget are presented. The final section outlines the controls used to monitor
progress and corrective action.
115) Some common forms of marketing department organization include functional organization, geographical
organization, product management organization and market management organization. Under a functional
department organization, a functional specialist, such as a sales manager, advertising manager, or market research
manager, is responsible for all marketing activities. Under a geographic organization, sales and marketing people are
assigned to specific countries, regions, and districts. Product management organization first appeared at P& G in 1929.
Under this approach, a product manager develops and implements a complete strategy and marketing program for a
specific product or brand. Under a market or customer management organization, the company is organized around
the needs of specific customer segments. In firms that use this organization, one product line is sold to many different
types of markets and customers that have different needs and preferences. Finally, large companies that produce many
products sold in many geographic areas typically use some combination of these organizational forms.
116) Marketing ROI (return on investment) is the net return from a marketing investment divided by the costs of the
marketing investment. In other words, ROI is a measure of the profits generated by investments in a marketing
activity. M arketing ROI can be difficult to assess because the benefits of marketing are not alw ays easily translated in
dollar amounts. H ow ever, marketing ROI can be assessed in terms of brand aw areness, sales, or market share. Some
companies are now using marketing dashboards, w hich are single displays show ing several sets of marketing
performance measures. And beyond standard performance measures, many marketers are using customer- centred
measures such as customer acquisition, retention, and lifetime value.
117) Most companies enter a new market by serving a single segment, and if this proves successful they add more
segments. Sun- Rype began as a regional player, and thus it’s not surprising that the Sun- Rype brand is the
number- one player in Western Canada, holding a 55 percent share of the pure apple juice category in that region.
Over the years, Sun- Rype has added other related products—more juice varieties and other fruitbased products, such
as its Fruit to Go and Energy to Go products.Sun- Rype has also expanded its share of central and eastern Canadian
marketplaces, and its Fruit to Go and Energy to Go bars command a 31 percent share of this broader market.
118) D
119) E
120) D
121) B
122) A
123) A
124) B
125) B
126) C
127) E
128) C
129) A
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130) D
131) E
132) B
133) B
134) D
135) E
136) D
137) E
138) A market- oriented mission statement defines the business in terms of customer needs; products and technologies
become outdated, but basic market needs may last forever.
139) Sales and profits are only a rew ard for undertaking a useful activity; a company's employees w ill be more dedicated to
the company's mission if they feel that their w ork is significant.
140) A n SBU is a key part of a company–w hether a product, product line, department, or an entire division–that has its own
mission and objectives. Identifying and analyzing a company's SBUs are the first tw o steps in business portfolio
analysis.
141) It falls into the "star" category.
142) A company should invest in the more promising question marks to make them stars and to maintain the stars so that
they w ill become cash cows as their markets mature. Income from cash cows will help finance a company’s question
marks, stars, and dogs.
143) A s time passes, SBUs change their positions in the grow th- share matrix. Many SBUs start out as question marks and
move into the star category if they succeed. They later become cash cow s as market grow th falls, then finally die off or
turn into dogs tow ard the end of their life cycle. The company needs to add new products and units continuously so
that some of them w ill become stars and, eventually, cash cows that w ill help finance other SBUs.
144) Party Planning Paradise might attempt to identify and develop new markets for its current products, looking for
different demographic markets and geographical markets that might have a need its products w ould satisfy.
145) In this scenario, the restaurant w ould be follow ing a product development strategy.
146) The "new and improved" product w ould fall into the product development quadrant.
147) Marketers must w ork closely and coordinate activities with partners in other company departments to form an
effective value chain, with each department executing value- creating activities to design, produce, market, deliver,
and support the company's products.
148) M arket targeting involves evaluating each market segment’s attractiveness and selecting
one or more segments to enter. A company should target segments in w hich it can profitably
generate the greatest customer value and sustain it over time.
149) Ferrari sells only 1500 of its very high performance cars in N orth America each year, but at very high prices—from an
eye- opening US$190 000 for its Ferrari F430 model to an astonishing US$2 million for its FXX super sports car, w hich
can be driven only on race tracks. A nicher serves only one or a few special segments or “ market niches.”
150) The marketing mix components of product, price, place, and promotion are the tools that a company can use to
differentiate its products from competitors' and to achieve strong positioning in a target market.
151) This function allow s the marketer to analyze internal strengths and w eaknesses as well as environmental opportunities
and threats w hich, in turn, allow s the marketer to match the company's strengths to opportunities to pursue. From this
starting point, the market can continue w ith planning, implementation, and control.
152) Companies are looking at marketing expenditures as investments in profitable customer relationships, w ith the goal of
increasing individual customer lifetime values and overall customer equity.
153) A company's mission should be market- oriented instead of just product- oriented. It must be defined in terms of
satisfying basic customer needs. Products and technologies eventually become outdated, but basic market needs may
last forever.
154) Tim H ortons’ management has focused on product development by offering modified
or new products to current markets. Tim H ortons introduced cappuccino, bagels,
sandw iches, and soup to get consumers to see it as more than just a doughnut shop.

26
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155) The CM O heads up the company’s entire marketing operation and represents marketing on the company’s top
management team. The CM O position puts marketing on equal footing w ith other C- level executives, such as the chief
executive officer (CEO) and the chief financial officer (CFO).
156) The Threats and Opportunities A nalysis assesses major threats and opportunities that the product might face, helping
management anticipate important positive or negative developments that might have an impact on the firm and its
strategies.
157) A company can assess return on marketing in terms of standard marketing performance
measures, such as brand awareness, sales, or market share. M any companies are assembling
such measures into marketing dashboards—meaningful sets of marketing performance measures in a single display used
to monitor strategic marketing performance. Just as automobile dashboards present drivers w ith details on how their
cars are performing, the marketing dashboard gives marketers the detailed measures they need to assess and adjust
their marketing strategies.
158) E
159) E
160) A
161) D
162) A
163) E
164) B
165) E
166) E
167) A

27