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Chapter 2—Strategic Planning in Contemporary Marketing

TRUE/FALSE

1. The planning process identifies objectives and determines which actions are needed to attain
those objectives.

ANS: T PTS: 1 DIF: 1 REF: 37

OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

2. The planning process creates a blueprint that everyone in the organization must follow in order
to achieve the organizational objectives.

ANS: T PTS: 1 DIF: 1 REF: 37

OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

3. The planning process defines checkpoints at which the organization can compare actual
performance with expectations to indicate whether current activities are close to achieving
organizational objectives.

ANS: T PTS: 1 DIF: 2 REF: 37

OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

4. Marketing planning establishes the basis for a firm's overall strategy.

ANS: F PTS: 1 DIF: 2 REF: 38

OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

5. Relationship-building goals and strategies are seldom included in the plans of business firms.

ANS: F PTS: 1 DIF: 1 REF: 39

OBJ: 2-1
 NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

6. Good relationships with customers can equip a firm with vital strategic weapons.

ANS: T PTS: 1 DIF: 1 REF: 39

OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

46
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

7. Strategic planning has a critical impact on a firm's destiny because it provides short-term direction
for decision makers.

ANS: F PTS: 1 DIF: 1 REF: 39

OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

8. The strategic planning process involves allocation of necessary resources.

ANS: T PTS: 1 DIF: 1 REF: 39

OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

9. Tactical planning involves actions that focus on current and near-future activities that must
be completed in order to implement larger strategies.

ANS: T PTS: 1 DIF: 2 REF: 39

OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

10. Tactical planning usually involves the production of quarterly and semi-annual plans, along
with divisional budgets, policies, and procedures.

ANS: T PTS: 1 DIF: 2 REF: 40

OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

11. Middle and supervisory-level managers spend less time as compared to CEOs on planning activities.

ANS: T PTS: 1 DIF: 1 REF: 40

OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

12. The chief executive officer (CEO) and vice president of marketing spend a greater proportion of
their time on operational planning than do managers at other organizational levels.

ANS: F PTS: 1 DIF: 2 REF: 40

OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing administration & control
MSC: KN

47
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

13. Operational planning that involves the creation and implementation of tactical plans for the
departments within an organization is primarily the responsibility of top-level management.

ANS: F PTS: 1 DIF: 2 REF: 40

OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing administration & control
MSC: KN

14. The advertising director, marketing research manager, and other middle-level managers should be
involved in planning fundamental organization-wide strategies and the corporate budget.

ANS: F PTS: 1 DIF: 2 REF: 40

OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing administration & control
MSC: KN

15. Organization-wide objectives, fundamental strategies, long-term plans, and total budget
formulation are examples of strategic planning activities handled by top management.

ANS: T PTS: 1 DIF: 2 REF: 40

OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing administration & control
MSC: KN

16. To be most effective, the planning process should include input from a wide range of sources
both internal and external to the organization.

ANS: T PTS: 1 DIF: 1 REF: 40

OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

17. As the senior vice-president of marketing, Naomi will be closely involved in her firm’s
strategic planning.

ANS: T PTS: 1 DIF: 2 REF: 40

OBJ: 2-2
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing administration
& control MSC: AP

18. Middle-level managers tend to focus on strategic planning, which includes creating and
implementing tactical plans for their own units.

ANS: F PTS: 1 DIF: 2 REF: 40

OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

48
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

19. The planning process begins at the corporate level with the development of objectives.

ANS: F PTS: 1 DIF: 1 REF: 41

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

20. A firm's mission statement specifies its overall goals and operational scope and provides
general guidelines for future management actions.

ANS: T PTS: 1 DIF: 1 REF: 41

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

21. Organizations within the same industry usually have the same mission.

ANS: F PTS: 1 DIF: 2 REF: 41

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

22. Adjustments to a firm's mission statement typically occur during stable business environments and
unchanging management philosophies.

ANS: F PTS: 1 DIF: 1 REF: 41

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

23. A firm describes its overall goals and operational scope in its organization chart.

ANS: F PTS: 1 DIF: 1 REF: 41

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

24. In general, a mission statement can be described as a qualitative statement, whereas an objective
is often a quantitative statement.

ANS: T PTS: 1 DIF: 2 REF: 41

OBJ: 2-3
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing decision-
making processes MSC: KN

49
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

25. Statements such as “increase market share by 25 percent by 2009” or “open 50 to 75 new stores for
each of the next five years” are typically part of mission statements.

ANS: F PTS: 1 DIF: 2 REF: 41

OBJ: 2-3
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing decision-
making processes MSC: AP

26. The second step in the planning process is corporate development of the organization's objectives.

ANS: T PTS: 1 DIF: 1 REF: 41

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

27. Detailed organizational objectives should state specific intentions, such as "Snapple Corporation seeks to
increase its share of the non-carbonated soft drink market to 25 percent within the next two years."

ANS: T PTS: 1 DIF: 2 REF: 41

OBJ: 2-3
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing decision-
making processes MSC: AP

28. Well-phrased business objectives should specify time horizons for specific achievements, such as "It
is anticipated we will achieve our $77 million sales objective by March 31, 2009."

ANS: T PTS: 1 DIF: 2 REF: 41

OBJ: 2-3
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing decision-
making processes MSC: AP

29. The third step of the planning process is to assess an organization’s strengths, weaknesses,
and available opportunities.

ANS: T PTS: 1 DIF: 2 REF: 42

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

30. Marketing strategy is an overall company-wide program for selecting a particular target market
and satisfying consumers through a careful blend of the elements of the marketing mix.

ANS: T PTS: 1 DIF: 1 REF: 42

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

50
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

31. Each element of the marketing mix - product, price, distribution, and promotion - is a subset of the
overall marketing strategy.

ANS: T PTS: 1 DIF: 2 REF: 42

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

32. Strategies are static and, once implemented, should not be changed if the actual performance does
not meet the desired results.

ANS: F PTS: 1 DIF: 1 REF: 42

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

33. In the two final steps of the planning process, marketers put the marketing strategy into action;
then they monitor performance to ensure that objectives are being achieved.

ANS: T PTS: 1 DIF: 1 REF: 42

OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

34. Planning strategies are influenced by the elements of Porter’s Five Forces model.

ANS: T PTS: 1 DIF: 1 REF: 43

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

35. Porter’s Five Forces are potential new entrants, bargaining power of buyers, bargaining power
of suppliers, threat of substitute products, and rivalry among competitors.

ANS: T PTS: 1 DIF: 2 REF: 43

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

36. The Internet has impacted business for new firms by increasing the barriers to market entry.

ANS: F PTS: 1 DIF: 1 REF: 44

OBJ: 2-4
NAT: AACSB Technology | CB&E Model Marketing Plan | R&D Knowledge of technology, design,
& production MSC: KN

51
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 Strategic Planning in Contemporary Marketing

37. The number of suppliers available to a manufacturer or retailer affects the bargaining power of buyers.

ANS: F PTS: 1 DIF: 1 REF: 44

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Strategy | R&D Managing strategy & innovation
MSC: KN

38. Consumers can now obtain detailed pricing information on the Internet, which has increased
their bargaining power with car dealers.

ANS: T PTS: 1 DIF: 2 REF: 44

OBJ: 2-4
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Knowledge of technology,
design, & production MSC: AP

39. Apple iTunes is an example of a successful first mover.

ANS: T PTS: 1 DIF: 1 REF: 45

OBJ: 2-4
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing strategy &
innovation MSC: AP

40. Data suggests that business owners who adopt the first mover strategy will always be long-term
market winners.

ANS: F PTS: 1 DIF: 2 REF: 45

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

41. The idea of first movers being completely replaced by second movers and the resulting
disappearance of first movers from the marketplace is a myth.

ANS: F PTS: 1 DIF: 2 REF: 45

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Strategy | R&D Managing strategy & innovation
MSC: KN

42. SWOT analysis refers to examination of a firm's stability, work ethic, organizational structure,
and technological expertise.

ANS: F PTS: 1 DIF: 1 REF: 45

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

52
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

43. A SWOT analysis helps planners compare internal organizational strengths and weaknesses
with external opportunities and threats.

ANS: T PTS: 1 DIF: 1 REF: 45

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

44. Core competencies are actions done well by a firm that its customers value and competitors
find difficult to duplicate.

ANS: T PTS: 1 DIF: 1 REF: 45

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

45. Matching an external opportunity with an internal weakness produces a situation known as leverage.

ANS: F PTS: 1 DIF: 2 REF: 45

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

46. In a SWOT analysis, marketers face a problem when environmental threats attack their
organization's weaknesses.

ANS: T PTS: 1 DIF: 2 REF: 45

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

47. SWOT analysis provides an uncritical view of an organization's internal and external environments
to managers and helps them evaluate the firm's fulfillment of its basic objectives.

ANS: F PTS: 1 DIF: 2 REF: 45

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

48. A strategic window represents an extended period of time during which the key requirements of
a market and the particular competencies of a firm best fit together.

ANS: F PTS: 1 DIF: 2 REF: 46

OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

53
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

49. A customer-driven organization begins its marketing strategy with a detailed description of its
target market.

ANS: T PTS: 1 DIF: 1 REF: 47

OBJ: 2-5
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

50. A target market is a group of customers toward whom a firm directs its marketing efforts.

ANS: T PTS: 1 DIF: 1 REF: 47

OBJ: 2-5
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

51. Diversity in the U.S. population plays an increasing role in targeting markets.

ANS: T PTS: 1 DIF: 1 REF: 48

OBJ: 2-5
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

52. Technology is changing the distribution methods of traditional print media. If corporations change
their strategic plans to account for distribution variables in the marketing mix, there will be changes
to the remaining three variables in the marketing mix, as well.

ANS: T PTS: 1 DIF: 3 REF: 48

OBJ: 2-5
NAT: AACSB Technology | CB&E Model Distribution | R&D Managing logistics & technology
MSC: AP

53. The Barnes & Noble Web site, which sells books, CDs, and DVDs is an example of a
traditional retailer responding to distribution opportunities afforded by new technologies.

ANS: T PTS: 1 DIF: 2 REF: 49

OBJ: 2-5
NAT: AACSB Reflective Thinking | CB&E Model Distribution | R&D Managing logistics &
technology MSC: AP

54. The ability to download Microsoft and IBM software products directly from the Internet is part of
each firms' pricing strategy.

ANS: F PTS: 1 DIF: 2 REF: 49

OBJ: 2-5
NAT: AACSB Reflective Thinking | CB&E Model Distribution | R&D Managing logistics &
technology MSC: AP

54
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

55. As part of the communication link between buyers and sellers, organizations may communicate
promotional messages directly through salespeople or indirectly using advertisements and promotions.

ANS: T PTS: 1 DIF: 2 REF: 49

OBJ: 2-5
NAT: AACSB Analytic | CB&E Model Promotion | R&D Knowledge of media communications &
delivery MSC: KN

56. Pricing strategy is an area of marketing that is not closely regulated or subject to public scrutiny.

ANS: F PTS: 1 DIF: 2 REF: 50

OBJ: 2-5
NAT: AACSB Analytic | CB&E Model Pricing | R&D Managing strategy & innovation
MSC: KN

57. Fred’s Wholesale Club sends emails and catalogs to all members. Additionally, in-store pamphlets
promote the benefits of certain products. All of these materials are part of the integrated marketing
communications intended to send a consistent and unified promotional message.

ANS: T PTS: 1 DIF: 2 REF: 50

OBJ: 2-5
NAT: AACSB Reflective Thinking | CB&E Model Promotion | R&D Knowledge of media
communications & delivery MSC: AP

58. The five dimensions of the marketing environment are competitive, political-legal,
economic, technological, and social-cultural.

ANS: T PTS: 1 DIF: 1 REF: 50

OBJ: 2-6
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing the task environment
MSC: KN

59. Marketers make decisions about target markets and marketing mix variables in a vacuum, without
taking into account the dynamic nature of the five dimensions of the marketing environment.

ANS: F PTS: 1 DIF: 2 REF: 50

OBJ: 2-6
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing the task environment
MSC: KN

60. Toyota’s introduction of the hybrid-powered Prius is an example of how it has turned public
concerns and legal issues about the natural environment into an opportunity.

ANS: T PTS: 1 DIF: 1 REF: 51

OBJ: 2-6
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing the task
environment MSC: AP

55
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

61. The rule of three states that the third company in an industry has little chance of survival.

ANS: F PTS: 1 DIF: 1 REF: 51

OBJ: 2-6
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Knowledge of general business
functions MSC: KN

62. One reason for organizing into strategic business units (SBUs) is to help a company make decisions
about which product lines warrant commitment of additional resources and which should be
removed from the firm's portfolio.

ANS: T PTS: 1 DIF: 2 REF: 53

OBJ: 2-7
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing strategy &
innovation MSC: AP

63. Strategic business units (SBUs) of a diversified firm have common managers, resources,
objectives, and competitors.

ANS: F PTS: 1 DIF: 1 REF: 53

OBJ: 2-7
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

64. Each (strategic business unit) SBU in a firm prepares its plans in collaboration with other units in
the organization.

ANS: F PTS: 1 DIF: 1 REF: 53

OBJ: 2-7
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

65. Each strategic business unit (SBU) of a diversified company pursues the company mission; it has
no specific mission of its own.

ANS: F PTS: 1 DIF: 1 REF: 53

OBJ: 2-7
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

66. Strategic business units (SBUs) focus the attention of company managers so they can
respond effectively to changing consumer demand within limited markets.

ANS: T PTS: 1 DIF: 2 REF: 53

OBJ: 2-7
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

56
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

67. According to the BCG matrix, stars represent units with high market shares in high-growth markets.

ANS: T PTS: 1 DIF: 1 REF: 54

OBJ: 2-7
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

68. According to the BCG matrix, marketers seek to rid themselves of their cash cows because
those products hold low market shares in low-growth markets.

ANS: F PTS: 1 DIF: 1 REF: 54

OBJ: 2-7
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

69. According to the BCG matrix, question marks achieve high market shares in high-growth markets.

ANS: F PTS: 1 DIF: 1 REF: 54

OBJ: 2-7
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

70. Using the market share/market growth approach to portfolio performance analysis, dogs are SBUs that
promise poor future prospects and provide excellent candidates for abandonment at the earliest
feasible moment.

ANS: T PTS: 1 DIF: 1 REF: 54

OBJ: 2-7
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

MULTIPLE CHOICE

1. The process of anticipating future events and conditions and determining the best way to
achieve organizational objectives is known as:
a. researching.
b. planning.
c. controlling.
d. managing.
ANS: B PTS: 1 DIF: 1 REF: 37
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

57
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

2. Product lines, pricing decisions, selection of appropriate distribution channels, and decisions
relating to promotional campaigns all depend on:
a. the technology available to the firm.
b. plans made in the accounting department.
c. plans formulated within the marketing organization.
d. industry-wide planning programs.
ANS: C PTS: 1 DIF: 2 REF: 38
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

3. Marketing planning establishes the:

a. resource base provided by the firm's strategy.
b. economic impact of additional sales.
c. tactical plans that must be implemented by the entire organization.
d. basis for any marketing strategy.
ANS: D PTS: 1 DIF: 1 REF: 38
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

4. Relationship marketing can help a company:

a. create long-term, cost-effective links with individual customers and suppliers for mutual
benefit.
b. reduce its strategic planning effort since the need for such planning is greatly diminished.
c. find more effective media for use in advertising and mass marketing.
d. cut through the planning process and move into tactical plans.
ANS: A PTS: 1 DIF: 2 REF: 39
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

5. Effective relationship marketing is based in part on the use of:

a. inside information about competitors.
b. databases to track customer preferences.
c. large advertising budgets.
d. information about changing economic conditions.
ANS: B PTS: 1 DIF: 1 REF: 39
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

58
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 Strategic Planning in Contemporary Marketing

6. Relationship marketing refers to a firm’s effort to develop long-term, cost-effective links

with individual customers and suppliers. Many companies:
a. have been reluctant to adopt such initiatives.
b. use relationship marketing for the sole purpose of marketing research.
c. include relationship-building goals and strategies in their plans.
d. believe this is just a fad, and may not be sustainable in the long run.
ANS: C PTS: 1 DIF: 2 REF: 39
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

7. Within the last few years, IBM has decided to sell off its desktop PC business. This decision was
the result of planning.
a. tactical
b. marketing
c. strategic
d. economic
ANS: C PTS: 1 DIF: 2 REF: 39
OBJ: 2-1
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing strategy &
innovation MSC: AP

8. Best Buy wanted to open a new store in Rogers, Arkansas, but instead decided to renovate a closed
Kmart. This decision was the result of planning.
a. tactical
b. marketing
c. strategic
d. economic
ANS: A PTS: 1 DIF: 2 REF: 39
OBJ: 2-1
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing strategy &
innovation MSC: AP

9. Strategic planning has a critical impact on a firm’s destiny because it provides for its
decision makers.
a. customer input
b. individual goals
c. departmental goals
d. long-term direction
ANS: D PTS: 1 DIF: 2 REF: 39
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

59
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

10. Long-term plans focusing on those organizational objectives that will significantly affect a firm
for five or more years are usually referred to as plans.
a. strategic
b. marketing
c. economic
d. tactical
ANS: A PTS: 1 DIF: 1 REF: 39
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

11. If Chevrolet was planning to introduce a sports car powered by a hydrogen-oxygen fuel cell when the price
of gasoline in the United States reached $4 per gallon, this would best be described as a(n)
plan.
a. economic
b. technological
c. strategic
d. tactical
ANS: C PTS: 1 DIF: 2 REF: 39
OBJ: 2-1
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing strategy &
innovation MSC: AP

12. The U.S. Sports and Fitness Federation is determining where they should build their permanent
training facility. They want it near a populated center but one that is rural enough to provide ample
room. The federation is engaged in planning.
a. strategic
b. SWOT
c. marketing
d. economic
ANS: A PTS: 1 DIF: 2 REF: 39
OBJ: 2-1
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing strategy &
innovation MSC: AP

13. A company’s plans that focus largely on current and near-future activities are referred to as
plans.
a. strategic
b. marketing
c. economic
d. tactical
ANS: D PTS: 1 DIF: 1 REF: 39
OBJ: 2-1
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

60
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

14. Preparation of quarterly and semi-annual plans by personnel such as the general sales manager
or advertising director would be classified as planning.
a. consumer
b. tactical
c. strategic
d. managerial
ANS: B PTS: 1 DIF: 1 REF: 40
OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

15. In the planning hierarchy, plans dealing with organization-wide objectives, long-term plans, and
the total budget would be classed as plans.
a. annual
b. tactical
c. operational
d. strategic
ANS: D PTS: 1 DIF: 1 REF: 40
OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

16. Compared to other organization personnel, more time is devoted to long-range strategic planning by:
a. middle management.
b. manufacturing labor.
c. top management.
d. supervisory management.
ANS: C PTS: 1 DIF: 1 REF: 40
OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing administration & control
MSC: KN

17. SuperSavers Market, a small grocery store chain, is working on its tactical plans. The personnel
most involved in this operational planning process would be:
a. top management, such as the owner.
b. middle management, such as the merchandising and advertising managers.
c. store managers.
d. supervisory management, such as shift managers and night auditors.
ANS: B PTS: 1 DIF: 2 REF: 40
OBJ: 2-2
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing administration
& control MSC: AP

61
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

18. Operational planning:

a. should be used to establish the fundamental strategies of the organization.
b. is used to determine departmental rules and procedures.
c. is the responsibility of the top management.
d. should be completed at the same time the total budget is prepared.
ANS: B PTS: 1 DIF: 1 REF: 40
OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing administration & control
MSC: KN

19. Tactical planning should be done:

a. by supervisory personnel.
b. on a weekly basis.
c. to set divisional budgets, policies, and procedures.
d. by CEOs and CFOs.
ANS: C PTS: 1 DIF: 2 REF: 40
OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

20. Christopher, the chief marketing officer of an organization, was invited to speak at a seminar on
the marketing planning process. While explaining the concept, he stated that “if the planning
process includes inputs from suppliers, customers, and employees, it becomes .”
a. inconsequential
b. more effective
c. complicated
d. unrealistic
ANS: B PTS: 1 DIF: 2 REF: 40
OBJ: 2-2
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: AP

21. When General Electric’s NBC division acquired Universal Studios, the highest executive who approved
this acquisition was most likely , with the decision being the result of planning.
a. GE’s CEO; tactical
b. GE’s CEO; strategic
c. the head of NBC; tactical
d. the head of NBC; strategic
ANS: B PTS: 1 DIF: 3 REF: 40
OBJ: 2-2
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing strategy &
innovation MSC: AP

62
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

22. The planning process begins with:

a. writing the mission statement.
b. establishing organizational objectives.
c. formulating a marketing plan.
d. hiring a senior planner.
ANS: A PTS: 1 DIF: 1 REF: 41
OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

23. Which of the following best represents a mission statement?

a. U.S. Army: Be all that you can be
b. Bass Pro Shop: To be the leading merchant of outdoor recreational products,
inspiring people to love, enjoy, and conserve the great outdoors
c. Kellogg's: Breakfast cereals at a price everyone can afford
d. Wal-Mart: Stores big enough to make shopping interesting for every family member
ANS: B PTS: 1 DIF: 2 REF: 41
OBJ: 2-3
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing decision-
making processes MSC: AP

24. Which of the following is the last step in the marketing planning process?
a. Assessing organizational resources
b. Evaluating environmental risks and opportunities
c. Implementing the marketing strategy
d. Monitoring and adapting strategies based on feedback
ANS: D PTS: 1 DIF: 2 REF: 41
OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

25. All of the following are company objectives except:

a. increase sales by 10 percent per year
b. reduce product errors to less than 1 percent
c. to be regarded as the market leader of the worldwide hotel industry
d. to achieve a 25 percent market share in less than three years
ANS: C PTS: 1 DIF: 3 REF: 41
OBJ: 2-3
NAT: AACSB Reflective Thinking | CB&E Model Marketing Plan | R&D Managing decision-
making processes MSC: AP

63
Copyright ©2013 by South-Western, a division of Cengage Learning. All rights reserved.
 Strategic Planning in Contemporary Marketing

26. The basic objectives or goals of an organization are derived from its:
a. strategic plan.
b. tactical plan.
c. corporate strategy.
d. mission statement.
ANS: D PTS: 1 DIF: 1 REF: 41
OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

27. What is the third step in the marketing planning process?

a. Obtaining necessary financing
b. Defining the organization’s mission and vision
c. Assessing strengths, weaknesses, and opportunities
d. Establishing organizational objectives
ANS: C PTS: 1 DIF: 1 REF: 42
OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing decision-making processes
MSC: KN

28. The is the organizational program for selecting a target market and satisfying customers in
that market through the marketing mix.
a. operational plan
b. marketing strategy
c. relationship marketing approach
d. strategic plan
ANS: B PTS: 1 DIF: 2 REF: 42
OBJ: 2-3
NAT: AACSB Analytic | CB&E Model Strategy | R&D Managing strategy & innovation
MSC: KN

29. All planning strategies have the goal of creating:

a. sustainable competitive advantage.
b. bargaining power.
c. a strategic window.
d. barriers to market entry.
ANS: A PTS: 1 DIF: 1 REF: 42
OBJ: 2-4
NAT: AACSB Analytic | CB&E Model Marketing Plan | R&D Managing strategy & innovation
MSC: KN

64
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Dom Fernando, 212, 213, 235

Dom Luiz, 212-213

Dom Pedro, Emperor of Brazil, 243-244-245-246

Doré, Gustave, 234-235

Dowdeswell, Admiral, 231

Drunkenness in Russia, 141-142

Duc de Croy, the, a Belgian and an Austrian subject, 53

Dué, M., Swedish Minister to Russia, 128

Dufferin, Marchioness of, 88-89, 129, 139, 154, 159, 160

Dufferin, Marquis of, Ambassador to Petrograd, 88 sqq., 128, 129, 153; his
diplomatic methods, 156-157-310

Easter Supper in Russia, the, 109

Easy-going Austria, 49

Edinburgh, Duchess of, 125

Edinburgh, Duke of, 123

Elector of Brandenburg, 52

Emperor Frederick, 34, 79

Emperor William I, 32-33

Empress Marie, 208

Empress Elisabeth, 63-64

Empress Frederick, 33, 79

England, "Junker" Party's hostility to, 20

Environs of Berlin, 70 sqq.

European Courts, disappearance of, 13

Exciting salmon fishing, 166-167

Expensive entertainment, an, 153

Exquisite Russian church music, 92

Extradition Treaty between Great Britain and Paraguay, 204

Ferdinand of Saxe-Coburg, Prince, 212

Finland, 164-165 sqq.

Footman as entomologist, the, 246-247

Formosa, 277

Fortress Church, Petrograd, 89, 90

Francis II, last of the Holy Roman Emperors, 50-51

Franz Josef of Austria, 52, 308

Frederick Charles of Prussia, Princess, 34

Frederick Count of Hohenzollern, 52

Frederick the Great, 27, 36, 74-75

Frederick William I, 74

French Ambassador's ball at Moscow, unusual incident at, 190-191

Gapon, Father, 348

Gargantuan dinner, a, 187-188

Gatchina Palace, 208; children's play-room at, 209-210

George V, 186

German "door-politeness," 219

Germany, disappearance of the Court, 13

Germany, music in, 22-23

Ghika, Prince, Roumanian Minister to Russia, 128

Giers, M. de, Russian Minister for Foreign Affairs, 103, 202, 203, 204

Gigantic Court Pages, 40

Gonçalves, 241

Gortchakoff, Prince, and the Congress of Berlin, 1878, 66, 67

Gourmet, an ecclesiastical, 41-45

Gran Chaco, the, 268

Groote Constantia, 197

Gulf between Russian nobility and peasants, 147

>H

Harraka Niska, 164 sqq.

Henry the Navigator, Prince, 237

Hilarious funeral, a, 127-128

Hohenzollerns ever a grasping race, 52

"Holy Roman Emperor," the, 50

Hooveny M. van der, Netherlands Minister to Russia, 128

Howard, Dick, 207, 281, 285

Humbert, King, 326

Hungary, invasion of, by the Turks in 1683, 56

>I

Ice-boating on the Gulf of Finland, 176

India, 186

Indoor games, Russians' love for, 177

Inelegant palaces, 75

Inquisitive peasant, an, 135

"Intelligenzia," the, 104

Irritating customs in Vienna, 54-55

Ismail, Khedive of Egypt, 201

Ivan III, 184

Japan, 317-330, 343 sqq.

Japanese advertising, 338

Japanese politeness, 334

Jardine, Captain, 284 sqq.

Jena, 16

Jomini, Baron, 103

"Junker" Party, hostility of, towards England, 20

Karolyi, Countess, Austrian Ambassadress in Berlin, 38, 63

Katheodory Pasha and the Congress of Berlin, 1878, 66

Kiderlin-Waechter, Baron von, 306-307

King Edward attends Alexander II's funeral, 162

King of Prussia proclaimed German Emperor at Versailles, 15

Kingsley, Charles, 345

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Koltesha, 167-168-169

Koltesba, shooting at, 168 sqq.

Königgrätz, 15

Kremlin, the, 182 sqq.; the Great Palace, 185

Kyoto, the Emperor's palace, 321

Ladies' unchangeable Court fashions in Russia, 117

Lapp encampment on the Neva, 112-113

Lawson, Sir Wilfrid, 307

Lazareff and the great Orloff diamond, 124

Leopold I, 52

"Les Bals des Palmiers," 120

Leuchtenberg, Duchess of, see Beauharnais

Liebknecht, Herr, 29

Lisbon, 211

Lisbon, beauty of, 229

Lister, Lord, 192

Liszt, 26
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Lobkowitz, Prince, 59

Lopez, Francisco, 277

Lorraine, 15

Louis XIV, 52

Louis XVI, 57

Louise Margaret of Prussia, Princess, 43

Louise, Queen, of Prussia, 30-31

Lovendal, Count, Danish Minister in Petrograd, 306-307

Luncheon in pyjamas, 154

Luxembourg Palace, the, 36

"Making the Circle," trying ordeal of Prussian Princesses, 43

Margherita, Queen, 326

Maria II, Queen, 212

Marie Antoinette, 57

Mendelssohn, 31

Midnight drive, an exciting, 150-151

Militarism in Germany, 15 sqq.

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Mitsu, Count, 333

Mitsu, Countess, 334, 337

Moltke, Field-Marshal von, 30

Montebello, Comte de, French Ambassador, 189-190

Montebello, Comtesse de, 189

Montferrand, M., Architect of St. Isaac's, Petrograd, 91

Moscow, beauty of, 181-182 sqq.

Moscow cathedrals, three famous, 183

Moscow, Imperial Treasury at, splendour of, 184

Music, Germans as lovers of, 22

"Musical chairs" in Japan, 319

Napoleon I, 16; coronation of, 50-51; bribes electors of Bavaria,

Württemberg, and Saxony, 51

"Napoleon III," 36-37

Narrow escape from drowning of William II, 73

Natural beauties of Brazil, 246

Neva, blessing of the, 121

Newspaper enterprise, 316

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Nicholas II, 158, 189, 347 sqq.

Nihilist friends, 104 sqq.

Nikko river, Japan, 331

Nondescript waiters, 184

Novel form of sport, a, 171-172 sq.

Old Schloss, Berlin, 34-35; comparison with Buckingham Palace, 39-40

Opera in Lisbon, 221

Organ Mountains, the, 245, 248

Oriental traits in Russian character, 101

Orloff diamond, the, 124

Paget, Sir Augustus, 327

Palaeologus, Sophia, wife of Ivan III, 184

Paraguay, 276 sqq.; Extradition Treaty between Great Britain and, 204

Paraguayan race meeting, a, 281

Paraguayan women, attractive, 282

Parana river, the, 277

Patiño Cué, 285 sqq.

Peace Congress between Russia and Turkey in Berlin, 1878, 66 sqq.

Peasant's house in Russia, a, 131-132 sqq.

Pernambuco, 240

Peter the Great, 51, 95, 102-103 sq.

Peterhof, 196; its charming park, 197; a plethora of palaces round, 198

Petrograd, transference to, 76; a disappointing capital, 86; English Embassy

at, 89; Palace ball, 119; balls at, peculiarities of, 178; famous Society
beauties of, 179; inclement climate of, 193; revisited, 340 sqq.

Petropolis, diversions at, 245-246, 248

Pombal, Marquis de, 230

Portugal, two Kings of, 212

Portuguese bull-fights, bloodless, 214 sqq.; comparison of with Spanish,

216

Portuguese coinage, 228

Portuguese politeness, 220

Potemkin, 343

Potsdam, 71-72 sqq.

Potsdam Palaces, 74-75

Prussian militarism, 15 sqq.

Prussian Princesses, a trying ordeal, 43

"Princesse Château," 95 sqq., 180

Pugnacious Court Pages, 40-41

Quebec, 300

Queen Alexandra attends Alexander II's funeral, 162

Queen Victoria, queenly dignity of, 116

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Quirinal at Rome, the, 14

Radziwill, Princess William, 39

"Rag-time" and Rubinstein, 25-26

Rasputin, 348

Rauch, 31

Red-bearded priest, the, 110

Richter, Gustav, 30

Richter, Mme., 31

River Plate, the, 299

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Rio de Janeiro, beauty of, 240

Rome, the Quirinal, 14

Rubinstein and "Rag-time," 25-26

Russia, disappearance of the Court, 13

Russia and Turkey, Peace Congress in Berlin, 66

Russian frontier police, 84

Russian gipsies, 149-150; their fascinating singing, 151-152

Russian illusions, 198-199

Russian Imperial Yacht Club, the, 100

Russian ladies' unchangeable Court fashions, 117

Russian language, difficulties exaggerated, 94

Russian limitations, 102

Russian police, 77

Russian village habits, 146

Russians really Orientals, 101

Sadowa, 15

St. Isaac's church, Petrograd, 91; midnight Easter Mass at, 105 sqq.
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Scandalized governess, a, 155

Schleinitz, Mme. de, 25

"Schlüssel-Geld," an unpopular tax, 55

Schouvaloff, Count Peter, and the Peace Congress in Berlin, 1878, 66; 180

Schouvaloff, Countess Betsy, 179-180

Secret Police in Russia, the, 99

Seven Weeks' War, the, 15

Shah Jehan, 186-196

Shennan, Mr. David, 261-262

Sigismund, 52

Ski-ing, 168 sq.

Skobeleff, General, 179

Slovenly Russian uniforms, 118

Sobieski, John, King of Poland, routs the Turks, 56

Spanish and Portuguese bull-fights, difference between, 216

Sport in Russia, 128-129

Strauss, Johann, 58; an exacting conductor, 59

"Street of toleration," the, 126

Strousberg, Herr, railway magnate, 31

Stürmer, M., destroyer of the Russian Empire, 158

Sullivan, Sir Arthur, in Petrograd, 93

Talleyrand, 50

Tel-el-Kebir, 204

Tetschen, 48

Teutonic Knights, the, 16

Tewfik, 201

Tigre, the, 299

Toboganning in Finland, 174-175 sq.

Tokugawa dynasty, 320

Tokyo, 317

Tokyo, Uyeno Park at, 325; 332

Trinidad, 345

Tsarskoe Park, curiosities in, 193

Tsarskoe Selo, 191 sqq.

Turkey and Russia, Peace Congress in Berlin, 66

Turks, invasion of Hungary, by, in 1683, 56

Turks routed by John Sobieski in 1683, 56

 U

Ultimatum to Russia, a young man's, 202

Unusual occupants of a palace, 126

Urbain, the cook, 42

Van der Stell, Governor, 197

Vasco de Gama, 237

Victoria, Queen, 42

Victor Emmanuel, 14

Vienna, 48 sqq.

Vienna, delightful environs of, 64

Viennese Court entertainments, 62

Viennese orchestras, 55 sq.

Viennese restaurants and orchestras, excellence of, 55

Viennese women, comeliness of, 57

Villages in Russia, similarity of, 131-132

Vladimir, Grand Duke and death of Alexander II, 159

 W

Waddington, M., and the Congress of Berlin, 1878, 67

Wagner, the "Ring" in Berlin, 23-24, 25

Waitresses, aristocratic, 24-25

Water-throwing at Buenos Ayres Carnival, 249

Wends, the, 16

William IV, 72

Winter Palace, Petrograd, the, 114-122 sqq.

Wolseley, Sir Garnet, 204

Wolves as fellow travelers, 131

Yellow fever at Rio de Janeiro, 241-242-243

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