Competition and Competitive Advantages Quiz

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Questions and Answers

What is an example of indirect competition?

McDonald’s vs. Burger King

McDonald’s vs. Pizza Express (correct)

7-Eleven vs. a restaurant

7-Eleven vs. Circle K

Which of the following is a non-sustainable competitive advantage?

Lower Production Costs (correct)

Unique Selling Propositions (USP)

Servicing a Niche Market

Creating Customer Loyalty

What is a sustainable competitive advantage?

An advantage that is easy for competitors to take away

An advantage that can be maintained over competitors long-term (correct)

An advantage that is short-term and easily lost

An advantage based on creating customer loyalty

Which of the following is an example of a sustainable competitive advantage?

A company targeting a specific niche market Signup and view all the answers

What is a unique selling proposition (USP)?

Developing a benefit that the competition does NOT have Signup and view all the answers

What is an example of a sustainable competitive advantage?

Using cost-efficient, high-technology manufacturing systems Signup and view all the answers

What is one way to develop customer loyalty?

Having a very strong customer service department Signup and view all the answers

Which is a non-sustainable competitive advantage?

Highlighting the benefits that distinguish a product from the competition Signup and view all the answers

What is an example of non-sustainable competitive advantage related to placement?

Exclusive distribution in a market Signup and view all the answers

What is a non-sustainable competitive advantage related to quality?

Adding features to improve the product Signup and view all the answers

Which is a non-sustainable competitive advantage related to benefits of use?

Highlighting the benefits that distinguish a product from the competition Signup and view all the answers

What is a non-sustainable competitive advantage related to price?

Being less expensive than a competitor’s product Signup and view all the answers

What is a non-sustainable competitive advantage related to design features?

Influencing the way a product looks and what it does Signup and view all the answers

What is the major goal of promotion as a non-sustainable competitive advantage?

To aim for top-of-the-mind awareness Signup and view all the answers

What is the marketing goal for some companies related to placement as a non-sustainable competitive advantage?

To eliminate the competition Signup and view all the answers

What is the value of a product in relation to benefits of use as a non-sustainable competitive advantage?

In what the product will do for the person who buys it Signup and view all the answers

Study Notes

Competition Types

Indirect competition arises from products or services that are not the same but serve a similar purpose, such as different types of entertainment options competing for consumer attention.

Competitive Advantages

A sustainable competitive advantage provides a long-term benefit to a company, allowing it to maintain superiority over competitors through unique resources or capabilities.
Examples of sustainable competitive advantages include strong brand reputation, patented technology, or exclusive supplier relationships.

Unique Selling Proposition (USP)

A Unique Selling Proposition (USP) differentiates a product by emphasizing its unique features or benefits, making it appealing to a specific target market.

Customer Loyalty Development

Customer loyalty can be developed through exceptional customer service, rewarding repeat customers, and engaging communication that meets their needs.

Non-Sustainable Competitive Advantages

Non-sustainable competitive advantages are temporary benefits that can be easily replicated by competitors. Examples include:
- Placement strategies that rely on seasonal promotions rather than consistent retailer relationships.
- Quality improvements that can be matched by competitors quickly.
- Price reductions that are not sustainable long-term due to potential profit margin erosion.
- Design features that can be copied, offering only a brief edge until others replicate.

Promotion Goals

The major goal of promotion as a non-sustainable competitive advantage is to create awareness and generate short-term interest or demand in a crowded market.

Companies may aim to secure prime shelf space or promotional displays, which can provide temporary visibility but can be lost to competitors.

The value of a product in relation to benefits of use as a non-sustainable competitive advantage focuses on short-term benefits appealing to consumers, often leading to quick sales rather than enduring loyalty.

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Description

Test your knowledge on competition and competitive advantages with this quiz. Learn to differentiate between direct and indirect competitors, and identify types of competitive advantages. Explore real examples and plan for sustainable and non-sustainable advantages for a new product. Master the concepts to excel in the competitive business world.