Question 1

Which of the following marketing strategies requires either identifying additional opportunities to use the brand in the same basic way or identifying completely new and different ways to use the brand?

Accepted Answer

Increasing frequency of consumption involves finding more occasions or new ways for consumers to use the brand, thereby encouraging them to use it more often.

Question 2

One of the market leader strategies for expanding the total market is to focus on more usage. Two avenues are open for doing this: increasing the frequency of consumption or

Accepted Answer

Increasing the level or quantity of consumption is an effective strategy for expanding the total market. This can be achieved by encouraging customers to use more of the product or service, especially if it is consumable or can be used multiple times. This strategy can lead to increased sales and revenue for the company.

Question 3

When your competitor delivers more for less, two strategies can be employed to meet this threat. Such a situation was recently faced by Kmart. Which of the following combinations would be most appropriate to meet the challenge thrown-down by the competitor?

Accepted Answer

Differentiation is the process of distinguishing a product or service from the competition. Execution is the process of carrying out a plan or strategy. In this case, Kmart could differentiate its products or services from those of its competitor by offering unique features or benefits. Kmart could also improve its execution by improving its customer service or marketing efforts.

Question 4

In a pure ________ attack, the attacker matches its opponent's product, advertising, price, and distribution.

Accepted Answer

In a pure frontal attack, the attacker directly challenges its competitor by matching its product, advertising, price, and distribution strategies. This approach is straightforward and aggressive, aiming to confront the competitor head-on in the market.

Question 5

In general, a market leader will have about ________ of the total market in relation to other competitors.

Accepted Answer

Market leaders typically have about 40 percent of the total market share, which allows them to exert a significant influence over market trends and dynamics.

Question 6

Being a market leader is often a difficult position to maintain and defend. The market leader must protect its current market share through good defensive and offensive actions. Second, the firm can try to increase its market share, even if the market size remains constant. What is the third course of action recommended for market leaders?

Accepted Answer

The third course of action recommended for market leaders is to find ways to expand total market demand, which can lead to increased sales and profits for the firm. This can be achieved through marketing efforts, product innovation, or other strategic initiatives that stimulate consumer demand and increase overall market size. Pursuing markets others do not want or constantly seeking new technologies may not necessarily lead to long-term success, while winning promotional awards or being a cost leader are not necessarily sufficient strategies for maintaining market leadership.

Question 7

A marketing manager has decided to "leapfrog" competition by moving into cutting-edge technologies. This indirect approach to attacking competition can be characterized as ________.

Accepted Answer

The given scenario suggests that the marketing manager is not directly attacking the competition but is rather taking an indirect approach by focusing on cutting-edge technologies. This approach can be classified as a bypass attack - where a company seeks to outmaneuver competition by circumventing their strengths and entering unexplored markets.

Question 8

When a regional computer-manufacturing firm began to seek out customers who lived outside of its traditional market boundaries, the firm was employing which of the following new customer expansion strategies to expand its total market?

Accepted Answer

The regional computer-manufacturing firm is seeking customers outside of its traditional market boundaries, which suggests a geographic expansion strategy. The other strategies listed (product differentiation, latent demand, market penetration, and new market segment) do not necessarily involve expanding into new geographic markets.

Question 9

Which of the following strategies should be adopted by marketers during a recession?

Accepted Answer

During a recession, consumers are more price-sensitive and tend to cut down on their expenses. Therefore, it is important for marketers to communicate the value of their brand to consumers. This will help them differentiate their products from those of competitors and maintain customer loyalty. Focusing on price reductions and discounts (C) may attract short-term customers, but it may not be sustainable in the long run. Increasing investment on marketing existing products (A) may be difficult in a recession when companies may be facing financial constraints. Focusing on expanding the customer base (B) may not be cost-effective as it is more expensive to acquire new customers than to retain existing ones. Sticking to the budget allocations (E) adopted during the preceding years may not be feasible during a recession when the company's financial situation may have changed.

Question 10

Apex Corporation is considered to be a market follower in its industry. About what percentage of a hypothetical market structure would be controlled by market followers such as Apex?

Accepted Answer

Market followers typically control about 20 percent of a hypothetical market structure, with the rest being divided among the market leader, challengers, and nichers.

Question 11

The market nicher serves small market segments not being served by larger firms. Nichers account for about ________ of the market in relation to other competitors.

Accepted Answer

Market nichers typically account for about 10 percent of the market, focusing on small segments that larger firms overlook.

Question 12

When large companies can no longer defend all their territory, they launch a ________ defense where they give up weaker markets and reassign resources to stronger ones.

Accepted Answer

Contraction defense is the best choice as it involves giving up weaker markets and reducing the company's size to focus its resources on stronger markets. This is a common strategy used by companies when they are facing financial difficulties or when they need to refocus their business. Preemptive defense involves attacking competitors before they launch their own attack, flank defense involves focusing on a narrow market segment, mobile defense involves constantly moving and adapting to changing market conditions, and position defense involves focusing on a strong market position and defending it against competitors. None of these options fit the description of giving up weaker markets to focus on stronger ones.

Question 13

As a marketing manager, you have decided to pursue new customers with your established products. Specifically, the new customers that you want are those who might use the product but do not at present. Which of the following strategies is recommended to pursue such a customer market?

Accepted Answer

The market-penetration strategy is recommended for pursuing new customers for established products. This strategy aims to increase market share by encouraging current non-users of the product to start using it. This can be achieved by aggressive marketing and sales efforts, promotional activities, and targeted messaging that highlights the benefits of the product to potential customers.

Question 14

Benz & Frendz Corp., a manufacturer of high end consumer durables, experienced a sluggish sales growth in most of its product categories during three consecutive quarters of 2009. However, market analysis revealed that its competitors' sales had also slackened during this period. Analysts pointed out that when all firms are losing sales, it is extremely important to adopt strategies that are aimed at retaining customers. This led the firm to reduce operation costs while maintaining product quality. They also revamped their marketing strategy to focus on the values created by their products. Which of the following can be inferred from the strategies adopted by the firm?

Accepted Answer

The company's strategies of reducing operation costs, maintaining product quality, and revamping marketing to focus on product values suggest they were responding to an economic downturn affecting all firms, as indicated by the sluggish sales growth across the industry.

Question 15

A group of firms following the same strategy in a given target market is called a ________.

Accepted Answer

A group of firms following the same strategy in a given target market is called a strategic group. A strategic group consists of those firms in an industry that follow the same or similar strategies along the strategic dimensions, such as the level of product quality, pricing policy, distribution channels, degree of vertical integration, degree of diversification, etc. This concept is used to analyze industry competition and helps firms identify potential competitors and understand their competitive position in the market. A cabal is a secret political clique or faction, a cartel is a group of firms that collude to fix prices and output levels, a cooperative is a group of independent firms who work together to achieve mutual benefits, and an informal alliance is a loosely structured collaboration between firms without a formal agreement.

Question 16

When food product companies advertise recipes that use their branded products in entirely different ways, they are increasing the ________ of the brand.

Accepted Answer

By advertising recipes using their products in different ways, the company is increasing the frequency of consumption as consumers are being shown multiple ways to incorporate the product into their meals, leading to potentially more purchases.

Question 17

Once a company has identified its main competitors and their strategies, it must next ask:

Accepted Answer

Knowing what competitors are seeking (such as market share, profit margins, customer loyalty, etc.) can help a company better understand how to position themselves in the market and develop their own strategies. Understanding the competitive brand attributes and market entrance requirements can also be useful, but they are not as directly related to competitors' strategies. Attrition rate and promotion schemes may be relevant factors, but they are not the primary focus of this question.

Question 18

When "petroleum" companies such as Canadian-owned Nexen have sought to recast themselves as "energy" companies, increasing their research into the oil, coal, nuclear, hydroelectric, and chemical industries, these companies were employing a ________ strategy.

Accepted Answer

These companies were employing a mobile defense strategy by broadening their scope beyond just petroleum to include a wider range of energy sources. This approach allows them to adapt to changes in the market and protect their position by diversifying their interests.

Question 19

In a ________ defense strategy, the market leader can meet the attacker frontally and hit its flank, or launch a pincer movement so that it's forced to pull back to defend itself.

Accepted Answer

A counteroffensive defense strategy involves meeting the attacker aggressively and potentially launching a pincer movement to force them to defend themselves, which aligns with the description provided in the question.

Question 20

To counter value-based players, it will be necessary to focus on areas where their business models give other companies room to maneuver. For example, instead of directly competing with Walmart and other retailers, Shoppers Drug Mart emphasizes convenience, selection, and expert advice. Which of the following general strategies is Shoppers rug Mart using as its main competitive focus?

Accepted Answer

Shoppers Drug Mart is focusing on offering something unique and different from their competitors, by emphasizing convenience, selection, and expert advice. This is the basis of a differentiation strategy, which aims to set a company apart from its competitors by offering something that is perceived as unique and valuable by customers.

Quiz 11: Competitive Dynamics