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Entrepreneurship: Starting & Operating a Small Business, 4e (Mariotti)
Chapter 4 Exploring Your Market
1) Nike sells sneakers, but it also markets sneakers, using ________ to get its message out to
customers.
A) publicity
B) advertising and publicity
C) advertising
D) coupons
Learning Object.: 4.1 Discriminate between marketing and selling.
AACSB Category: Reflective thinking
2) Marketing is ________.
A) satisfying customers at a profit
B) the business function that identifies customers and their needs and wants
C) product, place, promotion, and price
D) All of the above.
Learning Object.: 4.1 Discriminate between marketing and selling.
AACSB Category: Reflective thinking
3) Which business function do experts agree you should focus on first when preparing to start a
business?
A) operations
B) marketing vision
C) financing
D) core concepts
Learning Object.: 4.1 Discriminate between marketing and selling.
AACSB Category: Reflective thinking
4) A ________ identifies distinctively the goods or services of one organization from others
through a design, symbol, name, term or other distinguishing features.
A) product
B) brand
C) strategy
D) positioning
Learning Object.: 4.1 Discriminate between marketing and selling.
AACSB Category: Analytical thinking
2
5) ________ is the business function that identifies customers and their needs and wants.
A) Marketing
B) Advertising
C) Selling
D) Promoting
Learning Object.: 4.1 Discriminate between marketing and selling.
AACSB Category: Reflective thinking
6) An entrepreneur's market is ________.
A) people who like your product
B) the same as competitors' markets
C) a three square-block area surrounding his or her location
D) the group of people who are current and possible future customers
Learning Object.: 4.1 Discriminate between marketing and selling.
AACSB Category: Analytical thinking
7) A business that markets is the same as a market-driven business.
Learning Object.: 4.1 Discriminate between marketing and selling.
AACSB Category: Reflective thinking
8) Explain why marketing is considered the business function that should drive all a business's
decisions.
Learning Object.: 4.1 Discriminate between marketing and selling.
AACSB Category: Analytical thinking
9) The most important thing you should do before launching your product or service is
________.
A) thoroughly research the market
B) raise enough capital
C) design your logo
D) hire the right employees
Learning Object.: 4.2 Summarize how market research prepares you for success.
AACSB Category: Reflective thinking
3
10) Research carried out indirectly through other existing resources is called ________.
A) secondary research
B) primary research
C) literature analysis
D) post-secondary research
Learning Object.: 4.2 Summarize how market research prepares you for success.
AACSB Category: Analytical thinking
11) In doing research, there are several choices to help you. Among these are ________.
A) business library
B) magazine articles
C) Internet research
D) All of the above.
Learning Object.: 4.2 Summarize how market research prepares you for success.
AACSB Category: Analytical thinking
12) Your best option in market research is generally primary rather than secondary research.
Learning Object.: 4.2 Summarize how market research prepares you for success.
AACSB Category: Analytical thinking
13) Psychographic analysis and behavioral analyses are examples of methods of ________.
A) market research
B) market segmentation
C) marketing
D) positioning
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
14) What is the third step of deciding who the potential customers are for your business?
A) understanding who might actually buy your product or service
B) understanding who needs your product or services
C) analyzing who has the authority to buy
D) analyzing the buying process that leads customers to your product or service
Learning Object.: 4.3 Choose your market segment and research it.
4
15) Which of the following aspects of a product/service is the most important to focus on when
selling?
A) benefits
B) features
C) price
D) usefulness
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Reflective thinking
16) Which of the following is a step in determining how customers decide to buy a product?
A) Determine the need it meets.
B) Analyze the buying process.
C) Think about who might actually buy it.
D) All of the above.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
17) Dividing a population on the basis of age, gender, income or education is ________.
A) marketing statistics
B) demographics
C) behavioral data
D) psychographics
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
18) Consumers who have a similar response to a certain type of marketing can be classified as a
________.
A) market segment
B) target market
C) market
D) small niche
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Reflective thinking
5
19) Which of the following is not a step in the buying process?
A) awareness
B) demographic analysis
C) information search
D) evaluation of purchase
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Reflective thinking
20) Which of the following is not a stage in the product life cycle (PLC)?
A) Competitive
B) Growth
C) Maturity
D) Decline
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
21) Dividing the market by purchase behaviors that have been observed is ________
segmentation.
A) demographic
B) behavioral
C) psychographic
D) benefits-sought
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
22) By teaching customers how to use its products, Home Depot is helping customers see the
________ of its products.
A) ramifications
B) benefits
C) features
D) utility
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
6
23) What is a focus group?
A) It is a method of market research that involves bringing together some people who might use
a product and having a researcher question them about it.
B) It is a method of market research that focuses on how the industry is performing.
C) It is a method of market research that involves collecting statistics about a group of people
who might use a product.
D) It is a method of research that uses unhappy customers.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
24) There is a subtle difference between the ________ and the ________ of a product. One is a
fact while the other is a perception.
A) revenue/costs
B) sales/marketing
C) features/benefits
D) None of the above.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Reflective thinking
25) Market research can help you get a fix on who your customers are and ________.
A) where you can reach them
B) what they want and need
C) how they behave
D) All of the above.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
26) ________ ask(s) people directly, through interviews or questionnaires, about their
perceptions of a product or service.
A) General research
B) Industry research
C) Statistical research
D) Surveys and focus groups
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
7
27) Understanding the status and trends of an industry can be aided by ________.
A) checking out the internet public library, your local Small Business Administration,
chamber of commerce, or local business school or college library
B) looking for recent articles on the industry in magazines or by using Google or other
search engines
C) looking on competitors' web sites
D) All of the above.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
28) The set of four stages that a product or market goes through from its beginning until its end
is
called the ________.
A) phases of product maturity
B) product life cycle
C) marketing cycle
D) product stages cycle
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
29) Market research is typically ________.
A) complete when the product or service is introduced
B) complete within six months after introduction
C) complete a year after product introduction
D) ongoing; you always do market research
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Reflective thinking
30) The product life cycle phases include ________.
A) introduction
B) decline
C) growth and maturity
D) All of the above.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
8
31) Smart marketers always emphasize ________.
A) benefits, not features
B) features, not benefits
C) benefits, not prices
D) None of the above.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Reflective thinking
32) The product life cycle compares gross profit to sales as a product/service moves through its
life stages.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Reflective thinking
33) Market research should be an integral part of your business.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Reflective thinking
34) Explain the difference between features and benefits and how it applies to sales.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
9
35) Explain what market segmentation is and how it applies to marketing.
Answer: If the best marketing strategies are focused on the customer, a company clearly has to
choose which customers to target. You need to figure out which segments of the market to target.
A market segment is composed of consumers who have a similar response to a certain type of
marketing. It is difficult to target two very different segments of a market. Marketers have
developed four basic ways to analyze a market:
2) Demographic segmentation - dividing a population based on a variable like age, sex, income,
3) Psychographic segmentation - dividing a population by psychological differences such as
4) Behavioral segmentation - dividing the market by purchase behaviors that have been
observed, such as brand loyalty or responsiveness to price.
If your company has very limited resources, you might choose to target only one segment. A
very large company might decide to appeal to the entire market by designing a product tailored
for each segment.
Learning Object.: 4.3 Choose your market segment and research it.
1) Awareness: The consumer realizes a need. Advertising or promotion is intended to make
2) Information search: Now that the consumer knows that she has a need or a want, she will
3) Evaluate alternatives. Now that the consumer knows of alternatives, she can evaluate which
4) Decide to purchase/buying decision: The first purchase is a test to see if this product/service
5) Evaluation of purchase: If the product or service clearly meets the need or want, then the
customer/consumer may begin to develop brand loyalty and tell others about the brand. If this
happens, you may be able to keep the customer for life.
Learning Object.: 4.3 Choose your market segment and research it.
Learning Object.: 4.3 Choose your market segment and research it.
AACSB Category: Analytical thinking
10
38) Positioning your product in the market involves ________.
A) buying advertising and obtaining publicity
B) distinguishing your product by demonstrating to customers that it is the cheapest in the
market
C) distinguishing your product from others being offered to the market segments you have
targeted
D) moving it to the top in search engine optimizing
Learning Object.: 4.4 Position your product or service within your market.
AACSB Category: Reflective thinking
39) The positioning statement for a business includes its name/brand, its competitive
industry/category, ________, and audience/target market.
A) features and points of difference
B) benefits or points of difference
C) benefits and similarities
D) pricing and distribution
Learning Object.: 4.4 Position your product or service within your market.
AACSB Category: Analytical thinking
40) A marketing plan can serve as a stand-alone document or be part of an overall business plan.
Learning Object.: 4.4 Position your product or service within your market.
AACSB Category: Analytical thinking
