CMA practice question 13 of 35

Upmarket stretching mat reflect

Full set: 1,331 questions

Answer options

A: A search for greater profit margins Correct answer

B: A way to provide lower-priced products

C: A middle market firm’s move into the upmarket and the downmarket

D: A way to add products within the firm’s current range

Correct Answer:

A. A search for greater profit margins

Explanation

Up-market (upward) stretching occurs when a lower- or mid-market firm adds higher-priced items. The chief rationale is to tap higher margins and prestige at the top end of the market.

Why Incorrect

B. Down-market stretching, not up-market, provides lower-priced products.
C. Simultaneous move both directions is two-way stretching, not specifically up-market.
D. Adding products within current range is line filling, not stretching upward.

References

1. Kotler & Keller, “Marketing Management”, 15e, Ch.13, p. 328 (upward stretch for higher profit margins).

2. MIT Sloan OCW 15.810, Session 15 slide 18 (upward stretch to capture higher margin segments).

3. Shankar, V. “New Product Line Extension Strategies,” Journal of Marketing, 1999, Vol.63(2), pp.1-2 (up-market stretch drivers: higher profitability).

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