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Exam 5: Business-Level Strategy

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Question 21

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A company pursuing a focus strategy:

A) attempts to serve all market segments.
B) concentrates on building market share in one market segment.
C) typically has more resources at its disposal than a differentiator does.
D) has a greater impact on costs and revenues.
E) produce different offerings for different segments.

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Question 22

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When a company is able to pioneer process innovations that lead to value innovation, it effectively changes the game in an industry and may be able to outperform its rivals for a long period of time.

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Question 23

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All focus strategies entail serving a specific market segment using a differentiation approach.

When a company offers a wide variety of products at lower prices than its rivals, it is most likely:

The generic business-level strategies are cost leadership, differentiation, and mass marketing.

Market segmentation refers to the process of subdividing a market into clearly identifiable groups of customers with similar needs, desires, and demand characteristics.

When a company already has a low-cost structure, it has to give up a lot of differentiation in its product offering to get additional cost reductions.

In commodity markets, competitive advantage goes to the company that has the lowest costs.

An efficiency frontier shows all of the different positions that a company can adopt with regard to differentiation and cost.

A company has a competitive advantage if it can increase costs relative to rivals.

Delta Airlines used to advertise its high-quality air travel service by saying it flew "anywhere, anytime." What generic strategy is represented by this advertisement?

Nick, a professional magician, is often invited to perform magic tricks at birthday parties and other social gatherings from across the country. However, he offers his services only to clients who stay in the same city as him. He is also known to charge less than other magicians in the city. Nick is pursuing which generic business strategy?

At The Luxury Hotel in Miami, Florida, three hotel employees serve the needs of each guest. In every room, a guest can summon a chef, a maid, or a valet by pressing a button at his/her bedside. Which generic business-level strategy is The Luxury Hotel utilizing?

Companies with a differentiation advantage tend to charge a lower price for their products.

A segmentation strategy requires that a company:

Which of the following statements is true of differentiation and cost structure?

When a company decides to serve a limited number of segments, or just one segment, it is pursuing a segmentation strategy.

A market segment consists of a group of:

When a company produces a wide range of products for various customer groups, it is following a _____ strategy.

Lucy's Swimwear Boutique offers swimwear that is targeted at affluent people who can afford to buy expensive, handmade swimsuits. Which of the following approaches to market segmentation is Lucy's Swimwear Boutique using?