Exploring Entrepreneurship
Student Resources
Chapter 6: Markets: Understanding Customers and Competitors
1. What are the missing words in the following definition: ‘The management of regular marketing can be characterized by a careful planning process which is informed by ______ to guide the selection of target markets and the composition of a marketing mix with which to position products competitively within the marketplace.’
- environmental forecasting
- market research
- product analysis
- customer understanding
Answer: B
Explanation
“The management of regular marketing can be characterized by a careful planning process which is informed by market research to guide the selection of target markets and the composition of a marketing mix with which to position products competitively within the marketplace.”
2. According to the text what are the main differences between marketing in a ‘corporate setting’ and an ‘entrepreneurial’ one?
- lack of resources; lack of brand name; difficulties in making contacts
- greater emphasis on personal selling and personal networking
- faster decision making; more personal responsibility
- better profit margins; lower costs and greater flexibility
Answer: A
Explanation
The main differences show the marketing difficulties faced by new ventures because of their newness, lack of resources and existing organization.
3. What are markets made up of?
- customers and competitors
- customers and potential customers
- customers, competitors and suppliers
- customer, competitors, suppliers and regulators
Answer: B
Explanation
Here the reference to markets focuses on customers, whether existing ones or potential customers.
4. What factors have contributed to the blurring of boundaries between different industries?
- technological innovation; political change; legal and socio-economic changes
- technological innovation
- changes amongst customers, competitors and suppliers
- none of these
Answer: A
Explanation
These are changes in the macro-environment and cover broad changes in the wider environment facing organizations.
5. According to the text, what characterizes the techniques used in entrepreneurial marketing?
- mass media, passive reception, customer resistance
- low cost, word-of-mouth
- informal, personal and strongly interactive
- guerrilla marketing and ambush marketing
Answer: C
Explanation
Option (a) refers to the characteristics of orthodox marketing undertaken by large organizations, (b) refers to marketing approaches that all types of firms may be able to use and option (d) deals with new trends in marketing.
6. New entrepreneurial ventures face the same marketing opportunities and challenges, as compared to their larger and more well-established counterparts.
- True
- False
Answer: B
Explanation
The marketing differences between the two types of organizations are, for example: entrepreneurial ventures facing a lack of resources, lack of legitimacy and more powerful incumbents.
7. One of the differences between marketing in a corporate setting and an entrepreneurial one is the reliance by the entrepreneur on personal credibility and skills in persuasive communication.
- True
- False
Answer: A
Explanation
The text cites the example of an entrepreneur who had previously benefitted from the credibility of the brand for which she worked, as a result of which potential customers would come to her. Once she had her own venture, this benefit was no longer available to her.