Exam One Study Guide Chapters 1, 2, 3, and 4

Chapter One Part I. What is one characteristic of the sequence of the market-driven planning approach? Market research occurs at what two points in the process of the market-driven planning approach? A nonmarket-driven planning approach can best be described by what limitation? In a market-driven planning approach, how is the differential advantage determined? In what stage of marketing evolution is the primary goal to ensure that the market recognizes the high-quality services an organization provides that provide great value to the community? How does the market-driven approach help minimize costs? A good target market is one that can be described as what? What is the most challenging stakeholder group for an organization to identify? Groups that provide necessary infrastructure, such as the media, but that do not engage in transactions with an organization are considered what? What is a major disadvantage when hospitals organize in a product line management approach? In a clinical co-management structure, a hospital contracts with a group of physicians to provide daily management for an inpatient or outpatient component of a particular service line. What is the benefit of this type of structure? (Hint: read under heading: Organizing for Marketing) A hospital that develops a structure that is organized around referral physicians, corporations, and employee assistance personnel is called what? What are some of the hallmarks of a market-driven culture? What benefits does an engaged customer offer to an organization? In the relationship paradigm versus the traditional marketing paradigm, the sales focus is on what? Some marketing experts have suggested that there is a fifth P to marketing, which could be what?

Chapter Two Part I. True/False? The mission statement for an organization sets the broad direction for an organization. True/False? A foundation for resource and financial-based planning is developed through a SWOT analysis. True/False? The cost-based differential advantage is the hardest differential advantage to regain once it is lost. True/False? Trust is an essential differential advantage in the customer believing the price is fair. True/False? Invisible value is the value that is built into a product or service. True/False? Sustaining innovations are those that might be viewed as incrementally new products or services. True/False? The three attributes that are common to distributive innovations are that they tend to be cheaper, easy to get, and somewhat more expensive than existing alternatives. True/False? Large, established firms with the financial resources to innovate are the organizations that typically bring disruptive innovations to the market. True/False? When Intel places a sticker on computers showing that their chip is inside, they are demonstrating their visible value. True/False? Evidence management is an organized approach to presenting capabilities. True/False? Increasing sales of present products to present markets is a product development strategy. True/False? Taking new products to new markets is a diversification strategy. True/False? Taking existing products to new markets is a market penetrations strategy. True/False? John Hopkins is working with a private hospital in China to establish a new cancer center. This approach is an example of the market penetration strategy. True/False? A market penetration strategy can occur through a more aggressive pricing strategy or distribution strategy than a competitor. True/False? Many womens hospitals are now establishing specialized services for men as a market penetration strategy. True/False? A medical group deciding to build a hospital is an example of backwards vertical integration. True/False? A health system has decided to create its own accountable care organization and be responsible for the health status of a group of patients. This is an example of a product development strategy. True/False? In the pharmaceutical industry, one company often licenses its products to another so that the second firm can market the drug. This is referred to as a strategic affiliation. True/False? Reducing the number of services in the service line is referred to as divestment. True/False? A multispecialty group has many satellite locations. As the market changes in population distribution, the group decides to close some clinic locations. This strategy is referred to as retrenchment. True/False? Harvesting is allowing a product to gradually decline by withdrawing support until there is little or no market demand. True/False? In the BCG matrix, the underlying assumption is that cash flow and rate of return are closely related to sales volume. True/False? When growth is low but present value is high, the product is a cash cow. True/False? Problem children have great growth potential but low market share. True/False? Revenues generated by stars should go to the cash cows. True/False? Revenue that the cash cows generate should go to the problem children. True/False? A key factor in the Five Forces Model is the threat of new technology. True/False? When the cost of switching among providers is low, competition can be intense. True/False? In health care, nurse practitioners and pharmacists represent the threat of new entrants. True/False? The Five Forces Model and the Blue Ocean strategy perspective both consider strategy in light of existing competitors. True/False? Red Oceans represents the blood of companies fighting for market share among existing competitors. True/False? In terms of the Blue Ocean perspective, new service innovations differ on two dimensions of the types of benefits offered and the price level. True/False? A market concentration strategy focuses on the most geographically concentrated group of customers. True/False? Hospital ROI has been found to be related to market share. True/False? Specialty hospitals can be said to follow a niche strategy. True/False? Specialty hospitals could be said to follow a concentrated strategy. Part II. Johns Hopkins, a major academic healthcare organization located in Baltimore, Maryland, has multiple satellite clinics throughout the wider Washington D.C. metropolitan area. This is what type of strategy? Many womens hospitals are now offering specialized programs for men. This approach is an example of what type of strategy? Scott & White Clinic in Texas and Aultman Hospital in Ohio have developed their own insurance products. These organizations have decided to pursue a strategy of what? Sharp Health Care has partnered with the CVS retail pharmacy chain to offer its services within CVS retail locations. This is an example of which marketing strategy? In a backward integration strategy, an organization becomes what? When growth in existing markets is slow or regulatory changes make it risky to remain in existing markets, organizations tend to pursue which of the growth strategies? IBM has increasingly partnered with healthcare organizations interested in applying the Watson cloud technology for healthcare applications to assist physicians and researchers. For IBM, this approach is an example of which type of growth strategy? Strategic alliances in which both corporate entities hold an equity position are defined as what? When there is a weak fit between a core business and a particular business line, organizations will typically follow what particular strategy? Increasingly, many hospitals are having to close service lines when the market is too small or costly to serve, such as the case in mental health. This is an example of which type of strategy? A pharmaceutical vice president has decided to gradually withdraw marketing and promotional support from a particular drug. She has instructed her sales force to no longer spend any time with physicians discussing this particular script, nor will any promotional support be provided. The number of generics competing against this formulary has increased, and the margins have declined precipitously. This is an example of what marketing strategy? In the BCG matrix, a marketing person can affect one of the two dimensions of this matrix as a function of their strategy. Which dimension could they possibly affect? In the BCG matrix, revenues generated by stars should be reinvested into which of the quadrants? A product would be considered a cash cow if what happened with market share and market growth? Which of the following is true of a service that is a problem child? What are the four factors that affect the intensity of competition in Porters Five Forces Model? In terms of Porters Five Forces Model, the formation of physician/hospital networks is an attempt to do what? What is the foundation of the 7-S framework? Suppliers can become a significant threat when they are able to do what? On a continuum of strategic perspectives, the Blue Ocean strategy is most dissimilar to which marketing strategy model? Mass marketing is when an organization decides to treat the entire market as what type of group? Boutique medical practices in which patients pay a significant amount upfront to ensure that they have personalized concierge service with their doctor is an example of which marketing strategy? In health care, it has been found that hospitals with higher profitability tend to be those with what type of market share?

Chapter Three Part I. True or False? Environmental assessment involves the acquisition and use of information about events, trends, and relationships in the environment. True or False? The decline in buying power when prices rise faster than income is called inflation. True or False? By the end of this decade, healthcare spending will reach almost 50% of the U.S. gross domestic product (GDP). True or False? Healthcare spending in the United States is higher than in all Western countries except Germany, and health outcomes are higher. True or False? Higher healthcare expenditures in the United States are attributed to technology, the fragmented health insurance system, and pharmaceutical costs. True or False? Although almost half of all adults search the Internet for health information, most still seek out medical attention after doing so. True or False? The vast majority of states are doing well in terms of either price or quality transparency information provided to consumers. True or False? The reviews of hospital quality provided on social media sites such as Yelp do not relate in any way to real, objective hospital quality ratings. True or False? As more women have entered the medical profession, the compensation gap between the genders has decreased substantially. True or False? The majority of the U.S. population is now composed of people of color. Part II. What happens when price levels rise faster than income? _______ is the money a consumer has remaining after taxes and paying for necessities. Healthcare costs as a percentage of the gross domestic product (GDP) is how much of the GDP? Compared to other Western economies, the United States spends more on health care. What is the outcome of this high spending on health care? What is consumer income composed of? The amount of money a consumer has left after paying for food, clothing, and shelter is referred to as what? What are surprise medical bills? Geotechnology will increasingly allow what? (Hint: read under structural responses to the senior market) In many metropolitan markets, the insurance provider competitive scenario could best be described as? Accountable health plans are a value-based model based on what?

Chapter Four Part I. True or False? After women search for healthcare information, they engage in conversations with their physicians regarding their findings as it affects their own care and that of their families.

2. True or False? Physicians have been under increasing pressure to provide care that they deem inappropriate in order to receive positive ratings in the post purchase evaluations patients post on the websites of the doctors institutions and in social media forums.

3. True or False? Almost half of all Google-related searches are health related.

4. True or False? A parent has taken her child to a new pediatric group. After leaving, she wonders if she made the right choice in going to this particular medical practice. This would be an example of the parent experiencing cognitive dissonance.

5. True or False? Some healthcare organizations have started alumni organizations for their past patients. This approach is a strategy to reduce psychological risk.

6. True or False? Choosing between two competing alternatives where the one not chosen is priced slightly lower, but the one chosen is slightly higher in quality is referred to as cognitive dissonance.

7. True or False? Decision freedom is the principle of being able to choose from many competing brands and not being restricted to just a few.

8. True or False? Journey maps are created from the perspective of the organization to map how it delivers care to the patient or customer.

9. True or False? Deciding which surgeon to choose for a triple-bypass procedure would be considered a limited decision-making process.

10. True or False? Choosing a health plan for ones family can be a high-involvement decision.

11. True or False? Routine decision-making can involve both low- and high-involvement purchase situations.

12. True or False? Because of the complexity of healthcare situations, consumers often rely on heuristic cues for decision making.

13. True or False? Brand loyalty is when the consumer chooses the same product or service for high-involvement situations.

14. True or False? When physicians were tiered on the lower level by the insurance company, it had the dramatic effect of damaging patient loyalty to those doctors.

15. True or False? Men use their social networks and their families in complex decision-making situations for health care.

16. True or False? Architecture of participation refers to patients who willingly participate in clinical trials and share their experiences on a website that others can read.

17. True or False? Nudging is a core tactic in the Health Belief Model.

18. True or False? Over-the-counter pharmaceutical purchases can be characterized as a limited decision-making situation.

19. True or False? Wellness programs would be positioned as a lower order in Maslows hierarchy of needs.

20. True or False? Attitudes are ones enduring cognitions or feelings.

21. True or False? It is essential for marketers to understand consumers attitudes because individuals always act on their attitudes.

22. True or False? VALS measures consumers value systems and is a useful tool for assessing social values.

23. True or False? In the VALS system, achievement-oriented individuals are heavily influenced by the actions and approval of others.

24. True or False? Birds of a feather flock together is the principle behind the Potential Rating Index by Zip Marked (PRIZM) system.

25. True or False? PRIZM is like VALS and is based on attitudes.

26. True or False? The foundation of PRIZM is demographics, media habits, and psychographics.

27. True or False? The changes in a persons behavior as a result of past experiences are referred to as learning.

28. True or False? Learning occurs as a result of stimulus, drive, cue, response, and reward.

29. True or False? Delineation is the ability to determine differences between stimuli.

30. True or False? A patient has a positive experience in a hospitals emergency department and then assumes that the inpatient care may also be good. This is an example of a generalization.

31. True or False? A consumer pays attention only to the advertisements for the medical group that they go to on a regular basis. This is an example of selective comprehension.

32. True or False? Interpreting information consistent with ones attitudes and beliefs is selective comprehension.

33. True or False? Financial, social, performance, and physical risks can all be perceived risks in the purchase of a product.

34. True or False? Trust in ones physician can reduce the risk or fear a person may have in a situation.

35. True or False? The family life cycle for most everyone is a static process where individuals go through six distinct steps from when they are single as young adults to when they are widows or widowers.

36. True or False? The modified family life cycle is the stages a person passes through from birth through the death of a spouse.

37. True or False? In syncratic decision making, the woman tends to dominate the decision making for family-related issues.

38. True or False? An example of an autonomous decision-making framework is when a husband or wife makes decisions independently.

39. True or False? Social class divisions in society are relatively unstable.

40. True or False? A dissociative reference group is one that an individual used to belong to but no longer does.

41. True or False? Physicians in solo practice tend to adopt new drugs quicker than those in group practices.

42. True or False? The more visible a product or service is in use, the more influential the reference group influence is on consumer choice.

43. True or False? Hispanics make up the largest ethnic minority group in the United States.

44. True or False? The Hispanic population continues to grow because Latinos continue to come from Mexico at an increasing rate.

45. True or False? The largest concentrations of Hispanics are in California and Florida.

46. True or False? As company size increases, the likelihood of offering health insurance to their employees is increasingly likely to decline.

47. True or False? Industrial buyer behavior differs from consumer behavior because the demand is derived.

48. True or False? In derived demand, the demand for one product or service is correlated with another product or service.

49. True or False? In industrial markets demand tends to be price elastic.

50. True or False? Industrial markets often differ from consumer markets in that the buyers are more geographically concentrated and have greater total sales volume.

51. True or False? The major difference between consumer buyers and industrial buyers is that in industrial buying there are purchasing requirements.

52. True or False? Industrial buyers often have a buying center that requires many people across the organization to be involved in the purchase.

53. True or False? Organizations buy as frequently as consumers.

54. True or False? In industrial buying situations, the initiator is usually the key decision maker in the buying group.

55. True or False? New task buying in industrial situations is similar to modified problem solving in consumer decision making.

56. True or False? A company buying paper clips or other office supplies would be doing a straight rebuy buying process.

57. True or False? The buying center typically has individuals playing the following roles: users, influencers, gatekeepers, controllers, and deciders.

58. True or False? Influencers are individuals both inside and outside the organization who affect the final decision of the buying center.

59. True or False? Gatekeepers are individuals who control information flow to the buying center.

Part II. 1. In what type of industry is the internal search process often sufficient for the consumer to move on to the purchase stage?

2. Purchases that involve significant risk, such as the selection of a neurosurgeon, are typically referred to as being what?

3. An extended search is often warranted in which type of decision situation?

4. In health care, limited decision making often occurs in which type of purchase situation?

5. Which of the following would be an effective strategy for a medical group to reduce post purchase dissonance?

6. The Health Belief Model is based on which two factors?

7. What is true about loss aversion? (Hint: Read under consumer decision models)

8. An example of _______ is when individuals turn to sites like diabetesconnect.com that harness collective intelligence.

9. The goals or needs that propel an individual to action are consider what?

10. Maslow developed his hierarchy of needs to explain what?

11. What is a true statement of consumer attitudes?

12. What tool is used to develop geodemographic profiles of consumers?

13. Learning is the result of which five factors?

14. Past reinforced behavior extended to other stimuli is referred to as?

15. Because of _______, consumers are exposed to a large number of messages but do not attend to all of them.

16. Interpreting information from advertisements in a manner that is consistent with ones beliefs is:

17. Repetition in advertising is implemented to counter the problem of what? (hint: read under psychological influences on decision making)

18. In health care, taking medications for treatment of epilepsy has been a problem that relates directly to which concept of risk?

19. Adherence to treatment by a patient is affected by?

20. In the traditional family life cycle, over time, family decision making becomes?

21. In the traditional family life cycle, as the wifes income rises, her influence in family decision making tends to do what?

22. What are the three ways in which a reference group can affect a person?

23. The reference group to which one does not wish to belong to is referred to as?

24. A reference groups influence is most significant when what happens?

25. The more necessary a product is, the less or more of what?

26. In industrial markets, demand is often derived, which means that demand for the product or service is derived how?

27. An insurance company decided to decrease insurance premiums. It saw no significant increase in the number of subscribers. In this instance, the demand might be described as?

28. A major complexity of trying to market a product or service to an organization with a buying center is that:

29. In industrial purchasing situations, straight rebuy is often handled by whom in the buyer behavior process?