Chapter 2: Strategic Planning and the Marketing Process
Multiple Choice


Strategic planning is useful to all organisations because it:

Encourages management to think systematically
Forces management to sharpen its objectives and policies
Helps with performance standards for control
Helps the company to anticipate and respond quickly to environmental changes
All of the above


A clear ______ acts as an invisible hand that guides people in the organisation so that they can work independently and yet collectively toward overall organisational goals.

Company objective
Company goal
Mission statement
Business portfolio


Mission statements should be:

Specific, realistic, motivating
Specific, realistic, simplistic
Realistic, motivating, simplistic
Motivating, simplistic, specific
None of the above


Which of the following is a good objective for a company?

Increase our market share
Increase our market share by 15% over the next 2 years
Increase our market share by 15%
Increase our market share over the next 2 years
Increase our market share indefinitely over the next 2 years


André owns a fishing, tackle and grocery store. Sales in the fishing equipment have been booming, however, the store merchandise is not moving and there is substantial waste. He decides to drop the grocery products to concentrate on the fishing and tackle trade. André has used ____________ to make this decision.

Strategic business unit
Business portfolio
Portfolio analysis
Strategic business planning
Clarify company goals and objectives


Procter & Gamble is a large multinational organisation specialising in many different products. As can be expected it is comprised of many different strategic business units (SBU). Which of the following would qualify as a SBU?

Beauty products division
Bounty towels
South American division
1 and 3
All of the above


___________ often require heavy investment to finance their rapid growth.

Cash cows
Question marks
New products


Which of the following is NOT a problem with a matrix approach to strategic planning?

They provide little direction with respect to future planning
They can be time consuming
They can be costly to implement
They can be misleading with respect to consumer value
They can be difficult to define


Reebok is developing many new products for different segments of the market. They have especially designed a new marketing campaign for seniors and children. Which quadrant of the product/market expansion grid are they focusing on?

Market penetration
Market development
Product development
Product expansion


Perfect Balance is a small accounting company with limited resources but a huge potential to succeed and grow in the future if they focus their efforts correctly. They have decided it is in their best interest to limit the amount of customers they serve by limiting their services provided. They are focusing on:

Market segmentation
Market segments
Market positioning
Market targeting
Market strategies


In the past 3 years, the city of Winnipeg has been flooded with new bagel stores opening up on every corner. These new stores are following the ____________ approach to a marketing strategy.



Through ___________ the company turns the strategic and marketing plan into actions that will achieve the company's strategic objectives.



Which of the following is NOT a marketing department organisation?

Product management
Market management


Typically, answers to the questions, "Who is our customer?" "What is our business?" and "What should our business be?" are found in which of the following?

The product concept
The company mission statement
The company goals and objectives
The organisational culture
The personnel manual


Which of the following in not a component of industry attractiveness under the GE portfolio planning system?

Market size
Market growth rate
Amount of competition
Relative market share
None of the above


All of the following statements about formal portfolio planning tools are true except:

It is sometimes difficult to measure market share and market growth
Portfolio approaches classify current businesses not future ones
Portfolio approaches alleviate the need for managers to use their judgement in determining what resources to give each SBU
Formal planning approaches can lead management to place too much emphasis on market-share
None of the above


In terms of business functions, the marketing department seeks to take the consumer's point of view. But this can create conflicts with other departments. The types of problems marketing creates for other departments includes:

Increased production costs
Disrupted production schedules
Increased inventories
1 and 2
All of the above


To successfully communicate and deliver the company's desired position to the consumer the company:

Must emphasise advertising in support of its positioning strategy
Must focus its promotional efforts on personal selling
Must place its greatest efforts on producing the desired product efficiently
Must focus the entire marketing program in support of the chosen positioning strategy
Must split the focus between the personal selling and product efficiency


One limitation of the perspective taken by the "4 P's" is:

They exclude such controllable variables as the economy, competition, and government regulation
They represent the seller's view of the marketing tools used to influence buyers, not the view of the consumers
They are impossible to apply to a new product
They exclude the most important "P" in business, profits
They cannot be adaptable to different geographic regions


When you are starting a small business or you currently own a small business, all the following situations can be remedied or even prevented by developing and actually implementing a sound strategic plan except:

You have taken on too much debt
Your growth is exceeding your production capacity
Your engineering design is not stable and does not meet industry standards
If you are losing market share to a competitor with a lower price
All of the above can be solved with a proper strategic plan


Which of the following is not considered a step in the process by which small firms create their strategic plans?

Identify the major elements of the business environment
Purchase all necessary resources in order to compete successfully
Describe the mission of the organisation in terms of its nature and function
Develop a set of long-term objectives that will identify what the organisation will become in the future
Identify the major driving force that will direct the organisation in the future


In a solid marketing plan, all the following areas are covered in the current market situation except:

Information about the market
A product review
A review of the competition
A review of the distribution
All of the above are covered


Ideally the best company mission statements will be:

Product oriented
Production oriented
Market oriented
Employee oriented
Company oriented


In setting marketing objectives to reach goals, which of the following is true?

Increasing sales is a better strategy than increasing profits
Marketing strategies must be developed to support marketing objectives
Increasing profits is best achieved by reducing costs
Increasing profits is a better strategy that increasing sales
Customer satisfaction is the priority, not sales or profits


Under the BCG growth-share matrix, the market growth rate provides:

A measure of market attractiveness
A measure of the company's strength in the market


Heinz has decided their new hot dog sauce division has not been performing well and is using too many resources. They decide to phase this SBU out and use the resources to develop a new product. This move would be considered a _________ strategy.



The General Electric strategic business-planning grid evaluates business on the basis of:

Macro- and microenvironmental factors
Market share and growth ratings
Industry attractiveness and business strength
Profit margins and demographic trends
Tangible and intangible products


Nike has just introduced into the market its first ever orthopaedic sandal for seniors or people with arthritis. This situation is considered:

Product development
Market penetration
Market development
None of the above


Nike has decided to bring back the "flip-flop" sandal. They will cater their advertising to seniors, as this is a comfortable shoe that is easy to put on. This situation is considered:

Product development
Market penetration
Market development
None of the above


Levi's realises they have very different markets with very different needs, characteristics and behaviours. The process of dividing up the different markets is refereed to as:

Demand forecasting
Market segmentation
Market targeting
Market positioning
Market segments


Leander Cosmetics is attempting to generate additional sales of its present products by promoting them more aggressively to its present consumers. Leander Cosmetics is engaging in:

Market penetration
Market development
Product development
Both 1 and 2


Selecting target markets involves decisions in all but which of the following areas:

Market positioning
Market segmentation
Market mix
Market targeting
Demand measurement and forecasting


A marketing opportunity must fit the firm's __________ and _____________ .

Resources and target market
Market mix and target market
Resources and market mix
Resources and objectives
Objectives and target market


A strategic business unit (SBU) is one which:

Has a distinct mission
Has its own competition
Controls its own resources
Can be planned independently of the other businesses
All of the above


The collection of businesses and products that make up the company comprise its:

Business portfolio
Business plan
Strategic plan
Planning portfolio
Financial portfolio


Marketing __________ is the logic by which the business unit hopes to achieve its marketing objectives.



The Alsace Corporation wants to evaluate the effectiveness of its total marketing program. It is likely to use:

Annual plan control
Sales analysis
Expense-to-sales analysis
Marketing audit
Profitability control


Which of the following should not be considered a controllable element of a firm's marketing strategy?

Development of marketing mix
Selection of a target market
An individual consumer that is part of the target market
Both 1 and 2
All of the above


A (n) _____________ is an attractive arena for a company marketing action in which a particular company would enjoy a competitive advantage.

Marketing plan
Marketing opportunity
Target market


______________________ is a system of values and beliefs shared by the people of an organisation that constitute the company's collective identity and meaning.

Company culture
Managerial climate
Company mission
Company morale
Human resources

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