The product-management organization has several advantages. The product manager can concentrate on developing a cost-effective marketing mix for the product and can react more quickly to new products in the marketplace; the company's smaller brands have a product advocate. The disadvantages are that product managers are not given enough authority, they become experts in their product area but rarely achieve functional expertise. The product-management system is costly and brand managers normally manage a brand only for a short time. The fragmentation of markets makes it harder to develop a national strategy. In addition to this, product and brand managers focus on market share and not in building customer relationships.
Diff: 2
LO: 1.4: Illustrate how to organize and manage a modern marketing department.
AACSB: Reflective thinking
128) What is a market-management organization?
Answer: Many companies sell their products to differing markets. When customers fall into different user groups with distinct buying preferences and practices, a market-management organization is desirable. Market managers supervise several market-development managers, market specialists, or industry specialists and draw on functional services as needed. Market managers of important markets might even have functional specialists reporting to them. Market managers are staff (not line) people, with duties like those of product managers. They develop long-range and annual plans for their markets and are judged by their markets' growth and profitability. Because this system organizes marketing activity to meet the needs of distinct customer groups, it shares many advantages and disadvantages of product-management systems.
Diff: 2
LO: 1.4: Illustrate how to organize and manage a modern marketing department.
AACSB: Reflective thinking
129) Define a category-management organization.
Answer: A category-management organization is where a company focuses on product categories to manage its brands.
Diff: 2
LO: 1.4: Illustrate how to organize and manage a modern marketing department.
AACSB: Reflective thinking
130) What is a customer-management organization? When should a customer-management organization be adopted?
Answer: A customer-management organization deals with individual customers rather than the mass market or even market segments. It is suitable when a close customer relationship is advantageous, such as when customers have diverse and complex requirements and buy an integrated bundle of products and services.
Diff: 2
LO: 1.4: Illustrate how to organize and manage a modern marketing department.
AACSB: Reflective thinking
131) Which of these is NOT identified as a reason that creating a superior customer experience is now a priority for companies in nearly every industry?
A) The number of brands in the marketplace continues to grow.
B) Terms of service (TOS) contracts are now enforceable via federal mandate.
C) Consumers have more products and services to choose from.
D) Consumers are more knowledgeable about market offerings.
E) Consumers have greater ability to influence public opinion about companies and their brands.
Answer: B
Diff: 2
LO: 1.5: Explain how to build a customer-centric organization.
AACSB: Reflective thinking
132) Most companies now realize that the path to creating stakeholder value begins with which of these strategic changes?
A) Simplifying organizational structures in order to lower time-to-market
B) Simplifying product portfolios in order to put more customer-satisfaction energy behind each product.
C) Expanding into as many product and market spaces as possible to capture customers before they lock into competitors' ecosystems
D) Re-envisioning the organization as focused on creating long-term customer value
E) Lowering fixed and variable costs by automating the customer experience
Answer: D
Diff: 3
LO: 1.5: Explain how to build a customer-centric organization.
AACSB: Reflective thinking
133) Which of these groups appears at the top of the traditional organizational pyramid?
A) Service managers
B) Middle managers
C) Customers
D) Frontline employees
E) Top management
Answer: E
Diff: 2
LO: 1.5: Explain how to build a customer-centric organization.
AACSB: Reflective thinking
134) Which of these would be considered the primary job of service managers in a customer-oriented organization?
A) Support frontline employees so they can serve customers well
B) Push management priorities down through the organization
C) Coordinate with fellow middle managers