To qualify a lead or inquiry, the supplier contacts the potential customer via direct mail,
fax, e-mail, or telephone and asks a series of preliminary questions to confirm that the
firm has significant sales and profit opportunity
Managers have four basic choices concerning international channels and resellers:
domestic reseller-exporters, international reseller-importers, direct sales, or
countertrade.
With the workload approach, business market managers estimate the total efforts that
sales personnel must undertake to serve the entire marketplace.
In mature business markets, a large number of high-purchase-volume customers tend to
be switchers, according to the Loyalty Ladder.
“Price” and “cost” are the same thing.
Scholars have identified six influence strategies for gaining and using
powerinformation exchange, recommendations, promises, threats, legalistic pleas, and
requests.
Transaction uncertainty is inversely related to the customer’s confidence that suppliers
have easy-to-use procedures for doing business, processing orders accurately, and
providing reliable and timely deliveries.
Firms in consumer markets are more likely to market their offerings directly to
customer firms than their business market counterparts.
Because business markets are predominately about aesthetics and taste, they are
inherently more global in nature than consumer markets, which are predominately
about functionality and performance.
Integrated logistics systems entail the interfirm and cross-functional planning,
implementation, and control of the flow and storage of raw materials, in-process
inventories, finished goods, and related information from supplier firms to customer
firms.
Value assessment is the work process of obtaining the exact worth in qualitative
benefits of some past market offering.
Armed with knowledge of an offering’s requirements cycle, the business market
manager can tactically adjust its price as a function of time from introduction in order to
maximize profits.
A risk-sharing, gain-sharing agreement is the bundling of customer strategy and
processes, supported by relevant software, for the purpose of improving customer
loyalty and, eventually, corporate profitability.
The Net Promoter Score (NPS) is derived from the answers to a
willingness-to-recommend question.
Gaining new business, sustaining reseller partnerships, and managing customers are
business market process for delivering value.
Implementation considerations should inform and guide the generation of market
strategy. It is in answering the question, “How will we do it?” that the business develops
action plans, designs sales and marketing programs, takes stock of its implementation
skills, and prepares for learning and adapting
The business network is interconnections among relevant people and organizations
within which each dyadic relationship is embedded.
The managers who deploy form of hybrid channels, adaptive channels, view their
distribution channels as webs of capabilities embedded in an extended enterprise. They
realize that by sharing their resources and capabilities in novel ways, they can take
advantage of profit-making opportunities that they could not exploit alone.
The core product must be a concrete, palpable “thing” not a service.
To gain a more detailed understanding of how customer requirements and preferences
vary, business market managers use more progressive bases of segmentation, such as
application, customer capabilities and business priorities, usage situation, and customer
profitability.
A collaborative relationship between two firms is a kind of strategic alliance, which is
simply a commercial agreement between two (or more) parties to work together in
some mutually defined ways.
Customer feedback provides the supplier with a chance to remedy problems that occur
and to retain a customer’s business. It does NOT give the supplier an early warning of
changing customer requirements and preferences.
The value of a product can only be assessed relative to the next best alternative product.
A brand is a shorthand descriptor of the promised value that a market offering delivers
to targeted customers and a means of differentiating this value from that of other market
offerings.
A firm can use alpha testing, where individuals within the firm simulate the target
customer’s use of a nearly realized product. After making any necessary adjustments or
refinements, the firm proceeds with beta testing, where the firm provides select
customers with the new offering and gains feedback on it from the customers’
experiences.
Flexible market offerings are composed of a few well-chosen naked solutions, each of
which is wrapped with well-chosen options, where the supplier makes these choices
prior to offering them to customers.
Prototypes are a research tool that allows selected customers to experience in a rough
form the functionality or performance of a new offering and give feedback to the
project team.
Allocation skills refer to a manager’s expertise in budgeting time, people, and money.
The total cost of ownership (TCO) is defined as the sum of purchase price minus all
expenses incurred during the productive lifetime of a product or service minus its
salvage or resale price.
Prospecting is often called the art of creating, extracting, and delivering customer value
and communicating the value created in a timely manner.
Monitoring skills refer to a manager’s expertise in budgeting time, people, and money.
The _______ refers to the fact that supplier firms and reseller firms rely upon different
profit models that are sometimes at odds with one another.
a. law of legitimate cross-purposes
b. law of perpetual change
c. opportunism
d. alignment
Using the tools of value assessment, ________ conducts the most thorough and
demanding evaluations of suppliers.
a. supply management orientation
b. procurement orientation
c. value orientation
d. buying orientation
The efficient, low-cost transactional experience provides inexpensive, convenient,
self-service exchange relationships with minimal value-added service, often through
Internet Web sites or other direct marketing media.
The most readily available reseller diagnostics are_______. Suppliers evaluate four
categories of expenses ” customer communications, paperwork flows, physical
distribution, and financial risk assumptions ” to learn whether certain costs are under
control and to contrast the efficiency of one channel versus another.
a. partner relationship management system
b. performance and activity reports
c. expense-to-revenue ratios
d. turns x earns
The _______ adds to the core product the those services, programs, and systems a
supplier offers to meet a broader set of customer requirements and preferences, or to
exceed the customer’s expectations in ways that add value or reduce cost for the
customer of any supplier.
a. brand
b. minimally augmented product
c. augmented product
d. potential product
Trade associations and consulting firms commonly compile and publish industry
averages of diagnostic measures in _______
a. partner relationship management system
b. performance and activity reports
c. expense-to-revenue ratios
d. turns x earns
The process that addresses all aspects of identifying customers, creating customer
knowledge, building customer relationships and shaping their perceptions of the
organization and its products is _______.
a. product development management
b. supply chain development
c. customer relationship management
d. business management
The goal of _______ in the context of business channels entails the augmenting
products and services channel partners contribute to the supplier firm’s market offering.
a. market access
b. value-added
c. cost-to-serve
d. total customer experience
_______ is a means of summarizing the branding strategy by displaying the number and
nature of common and distinctive brand elements across the firm’s products, revealing
the explicit ordering of brand elements.
a. brand equity
b. branding strategy
c. brand hierarchy
d. brand loyalty
The number of resellers authorized or direct sales persons assigned per geographic trade
area is _______. By adjusting this factor, the supplier makes it more convenient for the
customer to purchase an offering.
a. exposure
b. coverage
c. distribution intensity strategy
d. total customer experience
The _________ is designed to motivate resellers to buy in large quantities and store
local inventory.
a. allowance
b. payment discount
c. quantity or volume discount
d. trade or functional discount
_______ means offering customers leading-edge products and services that consistently
enhance the customer’s use or application of the product, thereby making rivals’ goods
obsolete.
a. Product leadership
b. Customer intimacy
c. Operational excellence
d. Strategy
As a consultant, the salesperson asks a series of focused SPIN questions during calls.
Through these questions, the rep helps the customer manager uncover _______
questions to gather general background information about the customer firm.
a. implied
b. explicit
c. situation
d. problem
As a consultant, the salesperson asks a series of focused SPIN questions during calls.
Through these questions, the rep helps the customer manager uncover _______
questions, which seek to pinpoint the customer firm’s difficulties and dissatisfactions.
a. implied
b. explicit
c. situation
d. problem
_______ in a working relationship is the firm’s belief that another company will
perform actions that will result in positive outcomes for the firm, as well as not take
unexpected actions that would result in negative outcomes for the firm.
a. Bridging
b. Trust
c. Commitment
d. Guarantee
A form of electronic transaction formats that facilitate delivery of added value is the
_______ which is a hosted, though unmoderated, cyber forum where users exchange
information about a particular product or service, technology, or industry.
a. community
b. catalog
c. electronic auction
d. exchange
The value proposition _______ consists of one or two points-of-difference (and,
perhaps, a point-of-parity) whose improvement will deliver the greatest value to the
customer for the foreseeable future.
a. all benefits
b. favorable points of difference
c. resonating focus
d. operational excellence
_______ aim at inventing new science or capturing new know-how so that required
knowledge will be available for application in specific development projects.
a. Alliances and partnership projects
b. Research and advanced development projects
c. Breakthrough projects
d. Platform projects
In a _______, each salesperson is responsible for calling on customers in a defined
territory. They perform traditional selling activitiesmaking presentations, asking for
orders, and making after-sale calls. Their efforts revolve around discrete exchanges or
series of exchanges.
a. systems sales force
b. major account sales force
c. transactional sales force
d. strategic account sales force
_______ refers to selecting particular market segments and customer firms that the
supplier firm will focus its resources on serving. That is not to say that the firm will not
sell to other market segments or customer firms, but instead, targeting specifies which
segments and customer firms are of particular interest.
a. Targeting
b. Positioning
c. Operational excellence
d. Strategy
________ focuses on reducing total cost of ownership, not simply price, and is another
way to cooperate.
a. Integrative negotiation
b. Target costing
c. Target pricing
d. Standardization
The difference between value of the product and price of the product represents the
_______. In business markets, the value provided will likely exceed the price or else the
customer will be indifferent.
a. cost-plus pricing
b. competition-based pricing
c. value-based pricing
d. customer incentive to purchase
A(n) ________ captures the extent to which goal congruence exists among partner
firms’ self-interests and the degree to which complementary resources and capabilities
enable the partner firms to capitalize on marketplace opportunities.
a. reseller partnership
b. sustaining reseller partnerships
c. alignment
d. transforming channels
_______ is the application of disciplined tactics that predict customer behavior at the
micromarket level and that optimize product availability and price to maximize revenue
growth. It is applicable to market offerings that include perishable products and
opportunities, and markets featuring seasonal or periodic demand.
a. Revenue management
b. IMC planning
c. Situation analysis
d. Value cycle
_______ is NOT a criterion for judging the validity of a segmentation scheme.
a. Measurable
b. Profitable
c. Actionable
d. Applicable
_______ are initiatives that realize small advances in the firm’s current offerings or
production processes, such as making cost reductions in existing products, providing
product line extensions by adding or subtracting secondary features, and devising
incremental improvements for an existing production process.
a. Aggregate project plans
b. Derivative projects
c. Breakthrough projects
d. Platform projects
Estimates of a set of _______ such as sales growth rate, operating profit margin,
working capital investment and cost of capital, are used to calculate the present value of
forecasted cash flows and the residual value of the business after the forecast period.
a. value drivers
b. customer value
c. marketing value
d. shareholder value
The _______ are current or prospective customers who are experiencing problems or
needs that will become widespread in the market in the foreseeable future. They would
derive significant value immediately from an innovative solution.
a. lead-users
b. leap-froggers
c. alpha-testers
d. prototypes
_______ is (are) leads and inquiries that the supplier firm has qualified as having
significant sales and profit potential.
a. Leads
b. Inquiries
c. Prospects
d. Prospecting
_______ entails the related activities of internally generating leads from databases,
prompting and gathering inquiries externally from the marketplace, and qualifying leads
and inquiries as significant prospects.
a. Leads
b. Inquiries
c. Prospects
d. Prospecting
Explain lead-user customers.
When designing an integrated logistics systems system, business market managers
conduct what four tasks?
As a steel supplier preparing to bid business on a major aviation corporation, how will
the purchasing orientation of the buyer affect your bid? Include the three common
purchasing orientations in your response.
Briefly explain residual variation in the product and service requirements of a market
segment.
Explain the law of legitimate cross-purposes and law of perpetual change.
Explain the role of correspondent banking units (CBUs) role in doing business across
borders.
What are the Net Promoter Score and the three clusters of customers?
In his book on mass customization, consultant Joe Pyne instructs managers that
“when constructing market offerings, managers must realize that sometimes
moreis better while other times lessis better.” How does Mr. Pyne’s admonition
relate to our class discussions and the textbook chapter “Managing Market
Offerings”?
Based on the location of customers on the loyalty ladder against the supplier’s
cost-to-serve, explain the four types of customers created: most valuable customer,
partner, switcher, and undesirable customer.
How can positioning statements aid in focusing a project team throughout the
realization process?
Describe each of the following terms or phrases in your own words and give an
example.
Business Process
Transactional Relationship
Collaborative Relationship
Gives & Gets
Business Network Actor
Business Network Activities
Business Network Resources
Network Identify
Lead Operator
Explain marketplace equity, reseller equity, brand equity, and channel equity.
Describe one value assessment method and discuss under what circumstances you
would likely use it when assessing the value of a market offering to customers.
Contrast the two views about thinking of the core product as a tangible item or a
service, as discussed in the text.
Explain a channel positioning matrix.
Explain the importance of promoting honest and open communication between
suppliers and customers.
List the key points of parity between the Precision 2000 and the GLM 7Z84.
Explain business strategy as an overarching strategy.
Identify the four ways suppliers make commitments to assist reseller firms in delivering
value.