Essentials of Entrepreneurship & Small Business Mgmt., 7e (Scarborough)
Chapter 8 Building a Powerful Marketing Plan
1) ________ is the process of creating and delivering desired goods and services to customers
and involves all of the activities associated with winning and retaining loyal customers.
A) Marketing
B) Personal selling
C) Promotion
D) Customer service
2) For an entrepreneur, a business plan:
A) is of relatively little importance due to the dynamic nature of the marketplace.
B) is synonymous with the marketing plan.
C) tends to stress how the entrepreneur will operate rather than detailing what he/she wants to
accomplish.
D) contains both a marketing plan and a financial plan.
3) The focus of a small company’s marketing plan should be on:
A) preparing accurate financial forecasts.
B) the customer.
C) describing how its products or services are superior to those of competitors.
D) the competition.
4) Small businesses can compete with larger rivals with bigger budgets by employing
unconventional, low-cost creative techniques known as:
A) market research.
B) astonishing customer service.
C) guerrilla marketing strategies.
D) psychographics.
5) Warren Cassell, owner of Just Books, a very small book store, makes special orders for
customers at no extra charge, provides free gift-wrapping, conducts out-of-print book searches,
offers autographed copies of books, hosts “Meet the Author” breakfasts, and publishes a
newsletter for book lovers. By offering his customers lots of “extras” they do not get at larger
bookstores, Cassell has won a growing base of loyal customers. Cassell is relying on which
marketing strategy?
A) Demographic marketing
B) Transaction selling
C) Individualized marketing
D) Guerrilla marketing
6) Guerilla marketing is a marketing approach that takes an unconventional, low-cost and
creative approach to marketing that can give ________ a competitive edge over ________
competitors.
A) small companies; larger
B) larger companies; smaller
C) small companies; entrepreneurial
D) entrepreneurs; small
7) Which of the following is not one of the objectives a guerrilla marketing plan should
accomplish?
A) Determine customer needs and wants through market research.
B) Determine how the company will be able to serve all customers.
C) Analyze the firm’s competitive advantages and build a marketing strategy around them.
D) Create a marketing mix that meets customer needs and wants.
8) The specific group of customers at whom a company aims its good or services is referred to as
a:
A) market segmentation.
B) guerrilla marketing.
C) niche marketing.
D) target market.
9) Successful marketing requires a business owner to:
A) understand target customers’ needs, demands, and wants.
B) offer customers products and services that will satisfy their needs, demands, and wants.
C) provide customers with service, convenience, and value so that they will return.
D) All of the above
10) The foundation of every business is:
A) its products and services.
B) satisfying the customer through a customer-driven marketing strategy.
C) doing whatever it takes to earn a profit.
D) operating in a socially responsible manner.
11) Which of the following statements concerning a company’s target market is false?
A) Marketing experts contend that the greatest marketing mistake small companies make is
failing to clearly define the target market to be served.
B) A “shotgun approach” to marketing-trying to appeal to everyone rather than to only a small
market segment-is the most effective way to compete with large companies and their bigger
marketing budgets.
C) Small companies are usually better suited to pinpointing target markets that their larger rivals
overlook or consider too small to be attractive.
D) Most successful small businesses have well-defined portraits of the customers they are trying
to attract.
12) One of the greatest marketing mistakes small businesses make is:
A) failing to identify the target market.
B) spending too little on advertising.
C) underpricing their products and services.
D) spending too little on quality improvement.
13) Studies of shifting patterns in age, income, education, race, and other population
characteristics are the subject of:
A) psychographics.
B) demographics.
C) sociographics.
D) paleontology.
14) Tracking ________ patterns can enable entrepreneurs to adjust their strategies accordingly to
better position them to take advantage of the opportunities these trends may create.
A) population
B) demographic
C) weather
D) traffic
15) A common mistake entrepreneurs make is:
A) assuming that a market exists for their product or service.
B) taking too much time to conduct planning and research.
C) conducting informal research.
D) conducting online research, which is too impersonal and does not yield accurate information.
16) Which of the following statements concerning marketing research is false?
A) Market research is the vehicle for gathering the information that serves as the foundation for
the company’s marketing plan, helps avoid costly marketing mistakes, and can uncover unmet
customer needs the business can serve.
B) Market research involves systematically collecting, analyzing, and interpreting data pertaining
to the small company’s market, customers, and competitors.
C) Small companies are at a distinct disadvantage compared to larger ones when conducting
market research since it is so expensive.
D) Small businesses cannot afford to miss their target markets and market research can help
them focus their efforts.
17) Which of the following techniques does marketing consultant Faith Popcorn recommend to
small business owners interested in tracking market trends?
A) Hire a top-10 market research firm to track trends for you.
B) Watch what the large corporations in your industry are doing.
C) Read as many current publications as possible.
D) Talk with two to three people at random each week to hear what they are buying and why.
18) Entrepreneurs can find the right match based on trends, their products or services, and the
appropriate target markets through:
A) expecting “more of the same” for the future.
B) looking back and not forward.
C) following their intuition.
D) market research.
19) Your friend has decided to conduct market research to assist in making informed decisions
for his small business. What should you recommend as the first step in the market research
process?
A) Collect data
B) Define the objective
C) Design the research
D) Determine the relevant information
20) An individualized (one-to-one) marketing campaign requires business owners to:
A) collect information on their customers, linking their identities to their transactions.
B) calculate the long-term value of their customers so they know which ones are most desirable
and most profitable.
C) practice “just-in-time marketing” by knowing what their customers’ buying cycle is and time
their marketing efforts to coincide with it.
D) All of the above
21) Which of the following is not a primary market research source?
A) Customer surveys
B) Focus groups
C) Daily transactions
D) All of the above are sources of primary market research.
22) Which of the following is not a secondary source of market research data?
A) Census data
B) Trade publications
C) Focus groups
D) Magazines
23) A process in which computer software that uses statistical analysis, database technology, and
artificial intelligence finds hidden patterns, trends, and connections in data so that business
owners can make better marketing decisions and predictions about customers’ behavior is know
as:
A) guerilla marketing.
B) data mining.
C) individualized marketing.
D) total quality management.
24) One “natural” advantage small businesses have over large businesses, which can be a
significant competitive advantage, is:
A) by building a community with customers and connecting with them on an emotional level.
B) their ability to conduct market research.
C) their lower costs.
D) their ability to serve many highly diverse target markets.
25) Which of the following guerrilla marketing tactic(s) allow a small company to utilize
relationship marketing successfully?
A) Keep in close contact with customers with “thank yous” and other personal communication
techniques.
B) Organize and sponsor a service- or community-oriented project.
C) Launch a loyalty or frequent buyer program .
D) All of the above
26) The marketing approach that is most effective today for a small business is:
A) mass marketing.
B) market segmentation.
C) niche marketing.
D) individualized (one-to-one) marketing.
27) Which of the following was not identified as one of the guerrilla marketing principles in your
text?
A) Strive to be like everyone else so that your company “fits in.”
B) Create an identity for your business.
C) Connect with customers on an emotional level.
D) Do not just sell-entertain.
28) A combination of news covered by the media that boosts sales without having to pay is best
described by the term:
A) guerilla marketing
B) entertailing
C) public relations.
D) data mining
29) A marketing concept designed to draw customers into a store by creating a kaleidoscope of
sights, sounds, smells, and activities, all designed to entertain-and of course, sell, is:
A) entertailing.
B) entertaining.
C) retailing.
D) branding.
30) Some of the most successful companies interact with their customers regularly, intentionally,
and purposefully to create meaningful and lasting:
A) relationships.
B) sales.
C) obligations.
D) memories.
31) A key customer benefit of a product or service that sets it apart from the competition answers
the critical questions every customer asks: “What’s in it for me?” and is known as:
A) its brand identity.
B) the unique selling proposition (USP).
C) total quality management (TQM).
D) branding.
32) The unique selling proposition (USP) focuses on:
A) a feature that is unlike others found in competing products that answers the question: What is
different?
B) a unique customer benefit that answers the question: What’s it in for me?
C) a premier priced product that answers the question: What product offers the highest quality?
D) emulating the most successful products in the industry.
33) A ________ is a company’s “face” in the marketplace and communicates a key message to
the target market.
A) blog
B) logo
C) unique selling proposition (USP)
D) brand
34) ________ is the process of communicating a company’s unique selling proposition to its
target customers in a consistent and integrated manner.
A) Branding
B) Selling
C) Entertailing
D) Marketing
35) Examples of ________ include a presence on Facebook, LinkedIn and Twitter.
A) Web sites
B) blogging
C) social media marketing
D) online advertising
36) ________ can be an effective part of a guerrilla marketing strategy, enabling an entrepreneur
to economically communicate with large numbers of customers.
A) Frequent emails
B) Brand awareness
C) Direct mail
D) Blogging
37) An effective approach to creating effective online videos is to take an ________ approach to
present information in an entertaining way.
A) “entertainment”
B) “edutainment”
C) “entertailing”
D) “entrepreneurial”
38) Most customers never complain to the business; in fact, for every complaint that a company
receives, there are ________ other complaints that go unspoken.
A) 2
B) 7
C) 10
D) 17
39) How can a company achieve stellar customer service and satisfaction?
A) Listen to customers and define superior service.
B) Set standards and measure performance.
C) Hire the right employees and treat them with respect.
D) All the above
40) The majority of customers who stop patronizing a particular store do so because:
A) its prices are too high.
B) its quality is too low.
C) an indifferent employee treated them poorly.
D) it failed to advertise enough.
41) A recent survey reports that ________ percent of customers say that they will return to a
business after a negative customer service experience if the company offers an apology, a
discount, or proof that its customer service will improve.
A) 32
B) 52
C) 72
D) 92
42) A study by the National Science Foundation concluded that when pay is linked to
performance, employees’ motivation and productivity climb by as much as ________ percent.
A) 36
B) 56
C) 63
D) 75
43) Research shows that repeat customers spend ________ percent more than new customers.
A) 5
B) 52
C) 67
D) 97
44) In your training program, you stress to all new employees the importance of customer
satisfaction, citing the fact that ________ of the average company’s sales come from present
customers.
A) a small amount
B) about one-half
C) a majority
D) an undetermined percentage
45) A global customer loyalty consulting firm reports that a company must land ________ to
________ new customers to offset the impact of one lost loyal customer.
A) 2; 12
B) 6: 18
C) 12: 20
D) 20; 30
46) Companies with a customer focus typically ask their customers all but which of the
following questions?
A) What are we doing right?
B) What have we done wrong?
C) What can we do in the future?
D) What have our competitors done wrong?
47) The philosophy of producing a high-quality product or service and achieving quality in every
aspect of the business and its relationship with the customer, with a focus on continuous
improvement in the quality delivered to customers is.
A) total quality management, or TQM.
B) time compression management, or TCM.
C) guerilla marketing.
D) customer experience management, or CEM.
48) The process of systematically creating the optimum experience for customers every time
they interact with the company is:
A) total quality management (TQM).
B) time compression management (TCM).
C) customer experience management (CEM).
D) guerilla marketing.
49) Which of the following is not a suggestion of a means of focusing on the customer?
A) Seeing the customer’s point of view.
B) Get total commitment to superior customer service from everyone in the organization.
C) Carefully select and train everyone who will deal with the customer.
D) Actually, all of the above are suggested as a means of focusing on the customer.
50) Which of the following is a way to improve customer service?
A) Encourage customers to complain.
B) Ask employees for feedback on improving customer service.
C) Develop a service theme that communicates the importance of customer service in the
company.
D) All of the above
51) The total quality management (TQM) concept:
A) strives to achieve quality not just in the product or service itself, but in every aspect of the
business and its relationship with the customer.
B) relies on quality inspections through an army of quality control inspectors.
C) focuses on reducing the time it takes to fulfill a customer’s request for a product.
D) None of the above
52) Companies with strong reputations for quality follow certain guidelines, such as:
A) establishing long-term relationships with suppliers.
B) fostering individual effort and pride of workmanship.
C) securing employees’ commitment to the quality philosophy; it is not important to secure top
management’s full support, as the employees are the ones who work more closely with the
products and the customers.
D) All of the above
53) ________ pay the bills: without them, you have no business.
A) Accountants
B) Employers
C) Employees
D) Customers
54) Location, delivery services, effective use of easy-to-use technology and multiple
communication options are examples of:
A) convenience.
B) customer service.
C) blogging.
D) social media marketing.
55) A marketing strategy that relies on three principles to speed products to market, shorten
customer response times in manufacturing, and deliver and reduce the administrative time
required to fill an order is:
A) total quality management (TQM).
B) time compression management (TCM).
C) customer experience management (CEM).
D) guerilla marketing.
56) ________ is the key to future success and small companies can detect and act on new
opportunities faster than large companies.
A) Innovation
B) Speed
C) Convenience
D) Technology
57) What can a company do to achieve stellar customer service and satisfaction?
A) Listen to customers with the help of suggestion boxes, focus groups, surveys, and other tools.
B) Define what “superior service” means so that customers and employees know exactly what to
expect and what to provide.
C) Hire friendly, courteous sales and service representatives.
D) All of the above
58) The key ingredient in the superior customer service equation is:
A) state-of-the-art equipment.
B) standards and measurements of customer service.
C) the support of managers.
D) friendly, courteous, well-trained people delivering customer service.