Question 1

In the total profit approach, management forecasts potential sales and costs during the life of the plan to estimate likely profitability.

Accepted Answer

In the total profit approach, management considers potential sales and costs over the entire planning period to estimate the overall profitability of the plan.

Question 2

If the risks of getting into international marketing are difficult to evaluate, it may be wise to start with exporting

Accepted Answer

Exporting is considered a relatively low-risk entry strategy compared to setting up a foreign subsidiary or joint venture. It allows companies to test the waters and gain international experience before committing to more significant investments.

Question 3

All of the following are part of the direct marketing environment except:

Accepted Answer

While the economy can have an impact on direct marketing efforts, it is not considered part of the direct marketing environment. The direct marketing environment includes factors that directly impact the company's ability to engage in direct marketing, such as competitors, customers, and the company itself.

Question 4

Which of the following is not an element of the external market environment?

Accepted Answer

The external market environment refers to the factors and variables outside of a company that can impact its operations and performance. The technological environment, legal environment, economic environment, and cultural and social environment are all examples of external market environment factors. The company environment, on the other hand, refers to the internal factors and variables within a company, such as its organizational structure, operations, and resources. Therefore, the correct answer is B) Company environment, as it is not considered part of the external market environment.

Question 5

The General Electric "strategic planning grid" forces company managers to make three-part judgments (high, medium, and low) about the business strengths and industry attractiveness of all proposed or existing product-market plans.

Accepted Answer

The General Electric "strategic planning grid" does require managers to make three-part judgments about business strengths and industry attractiveness of proposed or existing product-market plans.

Question 6

In the short run, a marketing manager usually cannot control:

Accepted Answer

In the short run, a marketing manager typically has no control over external factors such as the competitive, cultural, legal, and economic environments. These elements are considered external to the organization and require longer-term strategies to influence or adapt to.

Question 7

When planning a marketing strategy, managers have control over:

Accepted Answer

While managers do not have control over external market forces, they do have control over their response to those forces. This includes the development of marketing strategies that address changes in the market, as well as the ability to adjust tactics as necessary. While managers can influence elements of the political, legal, cultural, social, and economic environments, they do not have complete control over these factors. Additionally, while consumers are a key consideration in marketing strategy, managers cannot truly control consumer behavior.

Question 8

The "continuum of environmental sensitivity" suggests that industrial products are more sensitive to the cultural environments in which they are placed than high-style consumer products.

Accepted Answer

The "continuum of environmental sensitivity" suggests that high-style consumer products (like fashion or luxury goods) are more sensitive to the cultural environments in which they are placed than industrial products, due to their closer ties to individual identities and cultural tastes.

Question 9

The General Electric "strategic planning grid" relies on subjective judgments about business strengths and industry attractiveness.

Accepted Answer

The General Electric strategic planning grid is a tool that relies on subjective judgments about a business's strengths and the overall industry's attractiveness. It involves evaluating businesses based on two dimensions: industry attractiveness and business unit strength. Therefore, subjective judgments are essential to effectively use this tool.

Question 10

Consumer products that are linked to cultural variables tend to be lower risk when entering international markets.

Accepted Answer

Consumer products that are closely linked to cultural variables often face higher risk when entering international markets due to differences in cultural norms, values, and preferences, which can significantly affect consumer acceptance and product success.

Question 11

GE's strategic planning grid considers two dimensions-industry attractiveness and business strengths-to identify opportunities that may be growth, borderline, or no growth.

Accepted Answer

The GE strategic planning grid does indeed consider industry attractiveness and business strengths to identify growth, borderline, and no growth opportunities.

Question 12

In international markets marketing managers usually have an easier time understanding the variables in the market environment.

Accepted Answer

Understanding the variables in the market environment is not always easy, especially in international markets where there may be differences in culture, language, regulations, and competition. Marketing managers must conduct thorough research and analysis to fully understand the market environment before making marketing decisions.

Question 13

Forecasts of the probable results of implementing whole strategic plans are needed to apply quantitative screening criteria.

Accepted Answer

Forecasts of the probable results of implementing whole strategic plans are necessary to apply quantitative screening criteria, as they help to evaluate the potential impact of the strategies and determine if they are in line with the company's goals and objectives. Without such forecasts, it would be challenging to make informed decisions about the viability of the strategies and their likely outcomes. Therefore, an accurate assessment of the potential results of implementing strategic plans is critical for effective decision-making and planning.

Question 14

Most industrial products tend to be near the "insensitive" end of the continuum of environmental sensitivity.

Accepted Answer

Industrial products tend to have a lower environmental sensitivity compared to consumer products as they are mainly designed for durability, reliability, and cost-effectiveness. However, this does not mean that all industrial products are completely insensitive to the environment. Some industrial products may still have environmental impacts, especially during their production and disposal stages.

Question 15

Opportunities which fall into the red boxes in the General Electric "strategic planning grid" are growth opportunities.

Accepted Answer

Opportunities which fall into the red boxes in the General Electric "strategic planning grid" are considered low growth opportunities and might not be worth investing in. The growth opportunities are typically found in the green boxes.

Question 16

The profit potentials of alternative strategic plans can be evaluated at the same time only if the plans are very similar.

Accepted Answer

The profit potentials of alternative strategic plans cannot be evaluated at the same time if they are very similar as they would not have enough differences to make meaningful comparisons. It is important for the strategic plans to have significant differences to evaluate their respective merits and choose the most profitable one.

Question 17

Marketing managers should remember that there are many variables in the ____________ that affect strategy planning.

Accepted Answer

All of these environments (economic and technological, competitive, cultural and social, political and legal) have variables that can impact strategy planning. Marketing managers need to consider each of these environments when developing marketing strategies to ensure that they are effective and appropriate given the specific context in which they will be implemented. Failure to take into account these variables can lead to ineffective or misguided marketing strategies that do not achieve the desired outcomes.

Question 18

Using the General Electric strategic planning grid, an opportunity rated "medium" in terms of both industry attractiveness and business strengths is an opportunity that the firm should always avoid.

Accepted Answer

An opportunity rated "medium" in both industry attractiveness and business strengths on the GE strategic planning grid is typically considered a "hold and maintain" opportunity. While it may not be the most attractive opportunity, the firm's current strengths make it worth considering and maintaining. It is not an opportunity that should always be avoided.

Question 19

The GE "stop-light" evaluation method is a very objective approach because GE feels there are too many possible errors if it tries to use subjective criteria for judging "attractiveness" or "strength."

Accepted Answer

The GE "stop-light" evaluation method, while aiming to simplify the evaluation process, still incorporates subjective judgments in assessing market attractiveness and business strength, as these assessments often involve qualitative factors and managerial judgment.

Question 20

Sustainability, as a screening criteria, supports the idea of focusing completely on the company's present needs.

Accepted Answer

Sustainability as a screening criteria refers to considering the long-term impact of the company's actions on the environment, society, and economy. Therefore, it encourages companies not only to focus on their present needs but also to consider the needs of future generations.

Quiz 3: Evaluating Opportunities in the Changing Marketing Environment