MKTG522 Unit 7 Learning Activity

Solutions
Instructions

In each unit, the student may choose to complete Learning Activities. Prior to working
on the Learning Activities, he or she should read through the chapters and the unit
lesson. If a student feels comfortable with the concepts in the reading, he or she may
not need to complete all of the Learning Activities. However, working on the Learning
Activities will increase confidence with the concepts. The student should be encouraged
to complete all of the practice activities.

Prior to completing the Final Assessment, a student must submit a total of two practice
activity units. He or she can choose to submit the Learning Activities from any two units
in the course. Ideally, these activities will help the student to develop skills and
knowledge required to pass the competencies, which will be evaluated by the
assessments. The two Learning Activity units may be submitted at any time prior to the
Final Assessment, in any order. The professor and student need to communicate to
determine which two activities will be counted for credit.

Upon submission, the professor should review each practice activity, provide
constructive feedback, and give up to 50 points for successfully completing the task. The
student may submit additional activities (beyond the first two) to receive feedback.
Learning Activity units contain two, three, or four parts. All parts must be completed in
order for the student to receive points. After the first two units have been completed
and evaluated, the student may submit whichever activities he or she chooses; he or she
does not need to complete all parts in order to receive feedback. If all goes well, a
student will e-mail the professor whenever he or she has uploaded work (activities or
assessments) to the Dropbox. You should e-mail the student after the assignment has
been reviewed.
Activity 1: CO 7, Competency A

Chapter 3 Company Case: Xerox: Adapting to the Turbulent Marketing Environment

Develop a SWOT Analysis From the Case and Answer Questions 3 and 4

Synopsis

For many years, Xerox was synonymous with the word photocopy. And in certain
respects, it still is. But that has become more of a detriment than a benefit. As new

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MKTG522 Unit 7 Learning Activity
Solutions
technologies quickly and dramatically reduced the need for copying hard documents in
the late 1990s, Xerox found itself in trouble. This case illustrates how Xerox made some
bold and difficult decisions to both cut costs and redefine the nature of its business.
Today, Xerox is more about business services and solutions than it is about copying
documents. With a much broader market that has various growth opportunities, Xerox
has the potential to remain one of the top business-to-business corporations.

Teaching Objectives

The teaching objectives for this case are to do the following.

1. Identify how microenvironmental factors can affect a strong, established

business.
2. Identify how macronenvironmental factors can affect a strong, established
business.
3. Identify strategic issues in responding to environmental factors.
4. Formulate recommendations for a company in crisis.

Discussion Questions (Answers 1 and 2 provide SWOT analysis factors)

1. What microenvironmental factors have affected Xerox’s performance since the late
1990s?
Company: Xerox lost its way for a time. It took new leadership (Burns) and some fast
cost-cutting moves to avoid bankruptcy. But the biggest changes at Xerox revolved
around the question, “What business is Xerox really in?” Xerox needed to begin the
process of redefining itself in terms of the products it made and the markets where it
competed.
Marketing Intermediaries: Xerox needed a way to establish new channels in order to
get into the back office of the business world. It acquired Affiliated Computer
Services for that purpose. ACS essentially becomes a division of Xerox rather than a
true intermediary. However, ACS plays the role that intermediaries play.
Competitors: The shift in strategy took Xerox into competition with new companies,
such as HP and IBM.
Customers: One could easily argue that the nature of customer needs changed with
so many changes in the macroenvironment, as noted below. As the case points out,
“although Xerox was busy perfecting copy machines, customers were looking for

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The copyrights in these materials are owned by DeVry Educational Development Corp. and other copyright owners as
indicated herein. No part of these works may be reproduced or used, distributed, published, displayed, transmitted in any
form or by any means – graphic, electronic, or mechanical, including photocopying, recording, Web distribution or
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MKTG522 Unit 7 Learning Activity
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more sophisticated ‘document management solutions.’”

2. What macroenvironmental factors have affected Xerox’s performance during that

same period?
Economic: Just as Xerox was beginning to see signs of life, the Great Recession hit,
causing the company’s revenues and stock prices to plummet.
Technological: This is probably the biggest category for this case. With the advent of
e-mail and telecommuting technologies, documents had gone digital. With that,
there was far less need for regular old photocopies. On the positive side, Xerox has
made massive efforts to acquire and develop new technologies, such as those that
allow it to analyze real-time parking and traffic data.
Cultural: One point here might simply be to point out that in the past 10 years, the
patterns of communication for the cultures of the world have shifted. People do not
think to stick things in the mail the way they used to. They send things electronically
instead. People do more texting than talking. Shifts such as this have major
implications for the old, new, and potential businesses where Xerox competes.

3. By focusing on the business services industry, has Xerox pursued the best strategy?
Why or why not?
It is clear that Xerox had to do something. Any company that sticks with a business
model as the market changes because that is what it has always done will sooner or
later face extinction (consider Kodak). The In-N-Out case for Chapter 1 illustrates a
company that has had great success on its model of “no change.” But that’s because
its customers still need and want what it sells. If anything were to happen that led
society to shun beef, In-N-Out would have a problem.

There may not be an easy answer to this question, because it certainly implies
subjectivity. However, there are a couple of things that provide justification that
Xerox did the best thing. First, business services was an area of growth at the time.
With so many changes in technology, businesses were desperate for companies to
help them manage the parts of their businesses that didn’t relate to their actual
products and services. Second, business services and solutions offered a step that
built upon Xerox’s background and strengths. They were essentially a document
company. They just had to break out from the parameters of a traditional photocopy
machine.

© 2015 DeVry Educational Development Corp. All rights reserved.

The copyrights in these materials are owned by DeVry Educational Development Corp. and other copyright owners as
indicated herein. No part of these works may be reproduced or used, distributed, published, displayed, transmitted in any
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MKTG522 Unit 7 Learning Activity
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4. What alternative strategy might Xerox have followed in responding to the first signs
of declining revenues and profits?
As noted above, “riding out the storm” really wasn’t an option. At least, it was not
an option that would have led to any kind of future for the company. Students may
have various suggestions for this. One option might have been to take its core
imaging technologies and find new uses in other markets, such as the medical field
or digitally archiving the libraries and documents of the world. However, both of
those options are mature and full of competition.

Teaching Suggestions

As a business-to-business case, this one may be a bit more difficult for students to relate
to. Start by having students visit (during or prior to class) www.xerox.com. Have them
browse the Services and Products sections to become familiar with the nature of Xerox’s
current business world.
Activity 2: CO 7, Competency B

Chapter 18 Video Case: Umpqua Bank—watch the Umpqua Video case (The link is
located on the Unit 7 Assignments page under Video for the Learning Activities section.)

Video Summary

The retail banking industry has become very competitive. And with a few powerhouses
that dominate the market, how is a small bank to thrive? It can do so by differentiating
itself through a competitive advantage that the big guys can’t touch.

That’s exactly what Umpqua has done. One step inside a branch of this Oregon-based
community bank and it is immediately apparent that this is not your typical Christmas-
club-savings-account-and-free-toaster bank. Umpqua has created a business model that
has transformed banking from retail drudgery to a holistic experience. Umpqua has
created an environment where people just love to hang out. It not only has its own
music download service featuring local artists, but it even has its own blend of coffee.

But under all these bells and whistles lies the core of what makes Umpqua so different:
a rigorous service culture where each employee in each branch gets measured on how
well he or she serves customers. That’s why every customer feels like they get the help
and attention they need from employees.

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The copyrights in these materials are owned by DeVry Educational Development Corp. and other copyright owners as
indicated herein. No part of these works may be reproduced or used, distributed, published, displayed, transmitted in any
form or by any means – graphic, electronic, or mechanical, including photocopying, recording, Web distribution or
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MKTG522 Unit 7 Learning Activity
Solutions

Questions and Answers

1. With what companies does Umpqua compete?

The video does not directly address this information. But because of the banking
services offered by Umpqua, it follows that its primary competitors are other
banking organizations. One might recognize that the primary competition may
come from regional banks and credit unions. People who are more likely to prefer
a nonglobal, large corporation would be more open to choosing Umpqua. But
there is also a strong case for such banks as competitors, given that Umpqua’s
competitive advantage offers a drastic alternative to the business-as-usual
approach of such banks.

2. What is Umpqua’s competitive advantage?

Banking has been fundamentally the same for 500 years. Umpqua has
differentiated itself as a service organization, not a banking organization. It has
taken best practices from industries like restaurants and hospitality and applied
them in the banking environment. Not only is this rooted in how each employee
treats and serves customers, but it is based on the experience the customer has
when he or she engages in Umpqua’s customer interface. This includes all the
aspects that make Umpqua’s retail outlets feel like a place that customers want
to hang out as well as those “nonbanking” features on Umpqua’s Website.

3. Do you think that Umpqua will be able to maintain this advantage in the long
run? Why or why not?
Based on the information in the case, Umpqua should be able to maintain its
competitive advantage. A couple of things that are typically considered when
assessing the longevity of a competitive advantage are below.
Can the competitive advantage be copied? Although it might seem likely that
someone else would copy this, the root of Umpqua’s success with its holistic
strategy is in the corporate culture. No company could pull something like this off
without a culture that is completely entrenched in the concept. This makes it less
likely to be copied.
Can the company continue the competitive advantage without running into
cost issues? According the video, Umpqua’s strategy doesn’t cost any more than
any other strategy. It’s simply a matter of choice, design, and execution.
Will the customer environment change such that customers are no longer

© 2015 DeVry Educational Development Corp. All rights reserved.

The copyrights in these materials are owned by DeVry Educational Development Corp. and other copyright owners as
indicated herein. No part of these works may be reproduced or used, distributed, published, displayed, transmitted in any
form or by any means – graphic, electronic, or mechanical, including photocopying, recording, Web distribution or
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MKTG522 Unit 7 Learning Activity
Solutions
drawn to the competitive advantage? This is always an uncertainty, but it is
probably safe to say that banking customers would rather step into an
environment like that at Umpqua than that at traditional banks and that there is
no foreseeable reason that this would change.
Activity 3: CO 7, Competency C

Chapter 20 Applications and Cases: Marketing Technology—Compostable Packaging

Corn-based packaging is hitting the shelves for everything from bottles to bags. But one
such endeavor had unintended consequences. Frito-Lay came out with a 100%
compostable bag for its Sun Chip line of chips. The package, made from 100% polylactic
acid (PLA), a corn-based biopolymer that fully decomposes within 14 weeks, had one
drawback—it was terribly noisy. An Air Force pilot posted a video on YouTube showing
the sound reaching 95 decibels when the bag was touched, leading him to claim it was
“louder than the cockpit of my jet.” Others likened the sound to “revving motorcycles”
or “glass breaking.” The package soon became the butt of jokes, even resulting in a
Facebook group called “SORRY BUT I CAN’T HEAR YOU OVER THIS SUN CHIPS BAG”
(Frito-Lay relented and reintroduced a less noisy bag).

Reference

Vranica, S. (2010, August 18). Snack attack: Chip eaters make noise about a crunchy bag.
The Wall Street Journal. Retrieved from
http://www.wsj.com/articles/SB10001424052748703960004575427150103293906

1. Search the Internet for more examples of compostable packaging. Discuss three of
them.

Answer

Some examples include Stonyfield Farm yogurt in corn-based packaging, as well as

other packages made from banana peels and potato skins (see
www.eatingwell.com/food_news_origins/green_sustainable/waste_less_packaging)
. Students can Google “examples of corn-based packaging” to find more examples.

2. Is corn-based compostable packaging a sustainable solution to replace petroleum-

based plastic packaging? Discuss the pros and cons of this alternative.

© 2015 DeVry Educational Development Corp. All rights reserved.

The copyrights in these materials are owned by DeVry Educational Development Corp. and other copyright owners as
indicated herein. No part of these works may be reproduced or used, distributed, published, displayed, transmitted in any
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MKTG522 Unit 7 Learning Activity
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Answer

For a comprehensive discussion of this material, see

www.smithsonianmag.com/science-nature/plastic.html?c=y&page=1. This article
explains the product and discusses the pros and cons of using this material.

There are several pros of this type of packaging: It’s made from a renewable
resource (corn); it’s growing cheaper than petroleum-based packages as the price of
oil increases; it’s compostable given the right conditions; and producing it uses 65%
less energy, produces fewer greenhouse gases, and involves no toxins compared to
producing petroleum-based plastic.

There are downsides to this using this type of packaging. The major one is that it is
only compostable under “controlled composting conditions” that require the
temperature to be maintained at 140 degrees for 10 days, which most consumers do
not have access to. One study found the package was unchanged after 6 months in a
typical home composter. Moreover, the 113 available composting sites in the
country cannot handle large truckloads; indeed, that quantity could be detrimental
to the composting system. Plus, the PLA material should not be put with petroleum-
based material, which means they would have to be separated from other refuse
before composting. Ironically, another criticism comes from environmentalists. They
question the wisdom of making packaging from foodstuffs when so many people in
the world are hungry. Also, the cultivation of corn uses fertilizer and creates other
environmental concerns.
References

Learning Activity Materials:

Kotler, P., & Armstrong, G. (2014). Principles of marketing (15th ed.). NJ: Pearson.

© 2015 DeVry Educational Development Corp. All rights reserved.

The copyrights in these materials are owned by DeVry Educational Development Corp. and other copyright owners as
indicated herein. No part of these works may be reproduced or used, distributed, published, displayed, transmitted in any
form or by any means – graphic, electronic, or mechanical, including photocopying, recording, Web distribution or
information storage and retrieval systems – without the prior written consent of DeVry Educational Development Corp. or
the respective copyright owner.

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