CMA Marketing Strategy & Planning Flashcards

Which pricing strategy involves setting a high initial price for a new product and lowering it over time?

Answer: Price Skimming

Price skimming sets a high launch price to capture maximum revenue from early adopters, then gradually reduces the price to attract more price-sensitive customers.

A market analyst calculates that a company's product has a 15% share in a $500M market. What is the product's annual revenue contribution?

Answer: $75 million

15% of $500M = $75 million, calculated by multiplying the total market size by the market share percentage.

Which strategic tool maps out how value is created and delivered to customers by analyzing a company's primary and support activities?

Answer: Value Chain Analysis

Porter's Value Chain Analysis examines primary activities (inbound logistics, operations, outbound logistics, marketing, service) and support activities to identify sources of competitive advantage.

When a firm targets several market segments and designs separate offers for each, this is called:

Answer: Differentiated marketing

Differentiated (or segmented) marketing involves targeting multiple distinct market segments with tailored offerings for each, increasing total sales but also costs.

What is the key distinction between a 'mission statement' and a 'vision statement' in strategic planning?

Answer: Mission describes current purpose; vision describes future aspirations

A mission statement defines the company's current purpose and how it operates today, while a vision statement articulates what the company aspires to become in the future.

Which of the following best describes 'market development' in the Ansoff Matrix?

Answer: Selling existing products to new markets

Market development involves taking current products or services and entering new markets or new customer segments to drive growth.