Marketing practice questions.

A market-oriented business is one that:

• focuses mainly on its production process and technical quality
• bases its decisions on the needs and wants of customers
• ignores market research to reduce costs
• sells only to other businesses

Answer: bases its decisions on the needs and wants of customers

Market orientation puts customer needs first and uses market research to guide decisions; product orientation focuses on the product itself and its quality/innovation.

Which of the following is an example of SECONDARY market research?

• running a customer focus group
• conducting a questionnaire in the street
• observing shoppers in a store
• reading a government industry report

Answer: reading a government industry report

Secondary research uses existing data collected by others (reports, articles, statistics). Primary research (focus groups, surveys, observation) is collected first-hand for a specific purpose.

In the Boston Consulting Group (BCG) matrix, a product with high market growth but low market share is classified as a:

• star
• an established cash cow
• question mark
• dog

Answer: question mark

A question mark (problem child) is in a fast-growing market but has low share; it needs heavy investment and may become a star or fail.

In the BCG matrix, a product with low market growth but high market share is a:

• star
• cash cow
• question mark
• dog

Answer: cash cow

A cash cow has high share in a mature, slow-growth market; it generates steady cash with little investment, which can fund stars and question marks.

During which stage of the product life cycle do sales typically rise most rapidly?

• introduction
• growth
• maturity
• decline

Answer: growth

In the growth stage sales rise quickly as the product gains acceptance; in maturity sales peak and level off, and in decline they fall.

The extended marketing mix (7Ps) adds which three elements to the traditional 4Ps, and is especially useful for service businesses?

• Price, promotion and place
• Profit, productivity and profit margin
• People, process and physical evidence
• Positioning, packaging and publicity

Answer: People, process and physical evidence

The 7Ps add People, Process and Physical evidence to Product, Price, Place and Promotion, reflecting the importance of service delivery and customer experience.