Chapter 2

Question 1

What does a company do to start the strategic planning​ process?

Answer 1

Define its overall purpose and mission.

Question 2

Mission statements should be defined in terms of satisfying basic customer needs. In other​ words, they should be​ __________.

Answer 2

market oriented

Question 3

What are the steps in the strategic marketing process?

Answer 3

1. define company mission
2. set company objectives and goals
3. design the business portfolio
4. plan marketing and other functional strategies

Question 4

After defining its​ mission, the next step in strategic planning is to​ __________.

Answer 4

set company objectives and goals

Question 5

What is the overall focus of strategic​ planning?

Answer 5

To create a game plan for​ long-run survival and growth in consideration of changing marketing opportunities

Question 6

In portfolio​ analysis, a company must identify​ __________, which are key businesses that make up the company.

Answer 6

strategic business units (SBU)

Question 7

What are the two measurements used in the BCG matrix to classify strategic business​ units?

Answer 7

Relative market​ share; market growth rate

Question 8

The BCG matrix classifies products which have a high market share in a low growth market as​ __________.

Answer 8

cash cows

Question 9

According to the​ growth-share matrix,​ __________ are​ high-share, high-growth products. When the market growth slows these products become​ __________.

Answer 9

​stars; cash cows

Question 10

​Strategically, a company may phase out or sell an SBU. This is known as​ __________.

Answer 10

divesting

Question 11

What are the 4 strategies for each SBU?

Answer 11

1. build
2. hold
3. harvest
4. divest

Question 12

Define building an SBU

Answer 12

the company can invest more in the business unit to build its share.

Question 13

Define holding and SBU

Answer 13

invest just enough to hold the SBU’s share at the current level

Question 14

Define harvesting an SBU

Answer 14

milking its short-term cash flow regardless of the long-term effect

Question 15

To grow​ sales, Under Armour increased its spending on advertising by 35 percent to increase sales in its current markets. Which growth strategy does this​ represent?

Answer 15

Market penetration

Question 16

When Under Armour expanded its current products into global​ markets, it was pursuing which growth​ strategy?

Answer 16

Market development

Question 17

When a firm starts up or buys a business outside of its current product line and​ markets, it is pursuing which growth​ strategy?

Answer 17

Diversification

Question 18

One key role marketing plays in a​ company’s strategic planning is to​ __________.

Answer 18

provide a guiding philosophy

Question 19

To improve the performance of the​ __________, many companies today are partnering with other members of the supply chain–—​suppliers, ​distributors, and customers.

Answer 19

customer value delivery network

Question 20

What is the internal value chain?

Answer 20

marketers must must work closely with partners in other company departments to form an effective internal value chain that serves customers

Question 21

In which way does increasing customer satisfaction disrupt the internal value​ chain?

Answer 21

It can increase production​ costs, increase​ inventories, and disrupt production schedules.

Question 22

What is the overall goal of marketing​ strategy?

Answer 22

To create customer value and build profitable relationships

Question 23

In determining which customers to​ serve, a company engages in which two marketing​ activities?

Answer 23

Segmentation and targeting

Question 24

Some​ retailers, such as the Dollar​ Store, Dollar​ Tree, and Family​ Dollar, profitably focus on buyers with modest means. This is an example of​ __________.

Answer 24

market targeting

Question 25

What does a market segment consist​ of?

Answer 25

A group of consumers who respond to the marketing effort in the same way

Question 26

Effective positioning is based on​ __________.

Answer 26

differentiation

Question 27

The four Ps of the marketing mix have been redefined in​ buyer’s terms as the four As. Product design influences​ __________, price affects​ __________, place affects​ __________, and promotion influences​ __________.

Answer 27

​acceptability; affordability;​ accessibility; awareness

Question 28

What are the main components of a marketing​ plan?

Answer 28

An executive​ summary, situation​ analysis, objectives, marketing​ strategy, action​ programs, budgets and​ controls, and threats and opportunities (p.82 on pdf)

Question 29

Which of the following is not one of the five marketing management​ functions?

Answer 29

Customer service

Question 30

Name the five marketing management functions

Answer 30

—analysis, planning, implementation, organization, and control. (pdf p. 80)

Question 31

The demand for organic produce is growing. Green Acres Farms grows only organic vegetables. In a SWOT​ analysis, the rising demand for organic produce would be​ a(n) __________ for Green Acres​ Farms, and the fact that they grow only organic vegetables is​ a(n) __________.

Answer 31

​opportunity; strength

Question 32

Which of the following is a true statement regarding managing and measuring marketing return on investment​ (ROI)?

Answer 32

Marketers are increasingly using measures such as customer acquisition and​ retention, customer​ engagement, and customer equity as measures of ROI.