In order to develop competitively compelling value propositions, all of the following
should be utilized EXCEPT:
a. include customers social cost.
b. consider how value propositions will resonate with customers as well as employees.
c. include customers economic cost.
d. focus strictly on sales revenue
e. consider the resource integrating nature of your customers.
_____ involves tailoring merchandise in each store to the preferences of its
neighborhood.
a. Neighborhood targeting
b. Micromarketing
c. Target marketing
d. Benefit analysis
e. Customer targeting
_____ is paid, nonpersonal communication through various media with the intent of
informing and/or persuading members of a particular audience.
a. Publicity
b. Advertising
c. Promotion
d. Propaganda
e. Self-promotion
_____ is the ability to make rapid decisions, to render judgements, take action and
commit oneself to a course of action until completion.
a. Flexibility
b. Leadership
c. Initiative
d. Enthusiasm
e. Decisiveness
The three major types of resources customers integrate as they co-create value in their
daily lives are:
a. direct, indirect, and target.
b. market, public, and private.
c. tangible, intangible, and secondary.
d. intentional, unintentional and primary.
e. separable, inseparable and initial.
A (an) _____________ perspective can result in a standardized set of procedures,
success formulas and guidelines.
a. creative
b. administrative
c. intuitive
d. strategic
e. analytical
Which of the following is an accurate statement about the scheduling of advertising?
a. The higher the degree of habitual purchasing of a product class, the more the
advertising should precede the purchase time.
b. Advertisers should always seek to have a higher CPM than CPM-TM.
c. Advertisements should be scheduled to always run in the Sunday paper.
d. Advertisements should be scheduled without regard to the CPM-TM that is
applicable.
e. Advertisements should be concentrated during periods of lowest demand in order to
pick up additional sales.
The final step in site selection is:
a. assessing the neighboring stores.
b. obtaining financing.
c. construction of a pro forma return on asset model for each possible site.
d. conducting an analysis of demand density.
e. conducting an analysis of supply density.
Divertive competition occurs when:
a. retailer A sends its customer to retailer B to purchase any products that A had
“out-of-stock.”
b. the customer buys product A rather than product B, which was the one he/she was
shopping for.
c. a retailer intercepts and makes a sale to a customer that normally would have
purchased the product at another retail store.
d. the retailer tries to entice the customer to buy a more expensive model or brand than
wanted.
e. the customer buys a private label instead of his/her usual brand.
For purposes of evaluating sites, the_____ is not relevant.
a. Expected net profit margin
b. Expected annual sales
c. Expected market share
d. Expected return on assets
e. Expected return on equity
Which of the following is a good guideline to use when selecting fixtures for your
store?
a. Large, metal, bulky fixtures will enhance sales while more delicate fixtures reduce
sales potential.
b. When shopping for clothing, let the fixtures point out the sizes before they reveal the
color of the items.
c. Design the store so that customers can view all the fixtures holding the merchandise
by turning at a 90-degree angle from their normal path of travel.
d. Always use simple ‘earth tones.’
e. Match the fixture to the merchandise, not the merchandise to the fixture.
If a retailer’s planned BOM inventory for April is $136,000, we can assume that the
retailer’s:
a. EOM inventory for March was $136,000.
b. planned sales for the month will exceed that amount.
c. BOM inventory requirements for May will be the same.
d. BOM inventory for March was also $136,000.
e. planned sales for the next month will exceed that amount.
_____ is the extent to which potential demand for the retailer’s goods and services is
concentrated in certain census tracts, ZIP code areas, or parts of the community.
a. Demand gravity
b. Demand growth
c. Demand concentration
d. Demand density
e. Demand elasticity
A(n) _____ depicts the amount of stock to have at the beginning of each month to
support the forecasted sales for that month.
a. current asset
b. BOM inventory
c. stock-to-sales ratio
d. sales-to-stock ratio
e. EOM inventory
_____ is a merchandising method in which all stores in a retail chain stock the same
merchandise.
a. An optional stock list
b. Scrambled merchandising
c. A standard stock list
d. Automatic merchandising
e. Cross-merchandising
When a retailer’s advertising message depicts the consumer in everyday settings using
the retailer’s products, the retailer is said to be using a(n) _____ approach.
a. everyday
b. lifestyle
c. reality
d. day-to-day
e. slice-of-life
Which of the following is NOT a common buying error that may cause adjustments to
be made to the retailer’s OTB?
a. Buying the wrong type of merchandise
b. Buying merchandise at the wrong price levels
c. Having too much or too little basic stock on hand
d. Buying from very few vendors
e. Failing to identify the season’s hot items early enough in the season
Marketing institutions are classified into two categories:
a. those that take title to the goods and those that do not.
b. those that are paid a flat fee and those that work on commission.
c. those that take possession and those that do not.
d. those that are profitable and those that are not.
e. those with high margin and those with low margin.
A type of salesperson who informs, guides, and persuades the customer in order to
culminate a transaction either immediately or in the future is called a(n):
a. profit-oriented seller.
b. persuasive seller.
c. order getter.
d. task-oriented seller.
e. order taker.
Customers can ‘self-inflict’ this type of competition when a brand name is perceived as
unique and highly valued, and a retailer controls its sale.
a. Pure competition
b. Pure monopoly
c. Monopolistic competition
d. Oligopolistic competition
e. Perfect competition
Which of the following is an example of an operand resource?
a. Store merchandise.
b. Employee’s skills.
c. Employee’s knowledge.
d. Balance sheets.
e. Target market segments.
When Taco Bell requires its franchisees to purchase all their raw materials and supplies
from the franchisor in order for the franchisor to maintain quality control, it is:
a. engaging in an illegal exclusive distribution agreement.
b. enforcing an illegal tying agreement.
c. employing a dual distribution agreement.
d. violating the franchisee’s right to fair trade.
e. enforcing a tying agreement, which courts generally consider legal as long as there is
sufficient proof that these arrangements are necessary to maintain quality control.
The use of the FIFO method of inventory valuation during high inflationary periods
produces lower profits on the income statement and results in lower taxes.
Goal statements should specify “how” a retailer intends to achieve a specific level of
performance, as well as the “time period” allowed for achievement of the results.
After an individual leaves one retailer to work for another, that person no longer has
any ethical responsibility to the previous employer.
Population density creates the concentrated customer demand that enables retailers to
provide any imaginable offering.
Retailers find it useful to group consumers according to population variables because
such data is often linked to marketplace needs.