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Penetration pricing means charging a relatively low price for a product as a way to
reach the mass market. The low price is designed to capture a large share of a
substantial market. Thus, penetration pricing:
a. tends to be more effective in a less price-sensitive market.
b. tempts competitors to enter the market.
c. provides a large profit per unit sold.
d. recoups product development costs quickly.
e. tends to lower production costs.
Answer:
_____is the cost of reaching one member of the target market.
a. Cost per contact
b. Cost per thousand
c. Gross rating
d. GRP
e. Effective reach
Answer:
When a company markets several different products under the same brand name, it is
referred to as a(n)____ brand.
a. family
b. generic
c. bargain
d. dealer
e. umbrella
Answer:
Cashtown Used Cars aired a radio spot announcing, "Today only, previously owned
cars are only $200!" Meghan just wanted some kind of intown transportation. When she
went to Cashtown, the salesperson said, "We have only one $200 car left, and it's not
the kind of car I"d want my wife to drive. However, we do have some great deals on
newer models." Meghan went home with an $8,000 used car. Cashtown is probably
practicing:
a. decoy pricing.
b. deal pricing.
c. functional pricing.
d. bait pricing.
e. price pressuring.
Answer:
Each week, Jess comes to the supermarket with a list of essential items: milk, bread,
peanut butter, and chocolate. This is an example of:
a. buyer's harmony
b. situational convenience
c. routine response behavior
d. limited decision making
e. consistent decision making
Answer:
Mimi Couturier is a design company that specializes in formalwear for women. The
company is known for challenging fashion mores. The company's fashion designers use
computerassisted design software to create what it thinks women should wear. The
company regularly hires industry experts to examine its factories to find waste and
inefficiencies that can be eliminated. The company has expanded the number of
products it offers for sale many times. However, for the last two years Mimi Couturier
has lost money, and it has had to lay off some of its workforce. To avoid this occurrence
in the future, Mimi Couturier should:
a. hire more retail efficiency experts to trace down any production problems
b. increase its sales force to find more potential customers for the firm
c. have someone study its target market to see what needs and wants should be met by
Mimi Couturier
d. cut prices so that its prices will be at least 10 percent below those of its competitors
e. design more sophisticated products that use the latest computer-aided techniques
Answer:
Firms can be categorized by the type of purchasing strategy used. ____ consider
numerous, even unfamiliar, suppliers and solicit and analyze options.
a. Satisficers
b. Strivers
c. Optimizers
d. Actualizers
e. Innovators
Answer:
Apple iPhone
Apple, Inc.'s iPhone first went on sale on June 29, 2007. Apple's loyal and enthusiastic
customer base is known for rushing to purchase its new products, and the iPhone
enjoyed a tremendous amount of buzz before its introduction. As expected, the iPhone
entered the market at what many believed to be a high price ($599). However, within
weeks, the price was reduced to $399. By the end of 2007, over eight million iPhones
had sold in the U.S. marketplace. By most, if not all measures, the original iPhone was
a huge success for Apple and its then-exclusive U.S. carrier AT&T.
On July 11, 2008, Apple, Inc. released the iPhone 3G, which it advertised as being
twice as fast as the original iPhone for half the cost. However, in order to obtain an
iPhone at the new price of $199, buyers had to agree to a two-year service contract with
AT&T. This approach succeeded, and over a million iPhone 3Gs were sold during the
introductory weekend. In 2011, the iPhone 4Sthe fifth generation iPhoneled cellular
phone sales with more than 25 million units sold. Several Android-based phones
manufactured by Samsung were not far behind, however.
Refer to Apple iPhone. When Apple introduced the iPhone at a high price, it was
probably using a ____ strategyto maximize profits.
a. price bracketing
b. penetration pricing c. price lining
d. price-fixing
e. price skimming
Answer:
Lopez is the largest Hispanic-owned meat processor in the United States. To assist
retailers in marketing its products, Lopez provides point-of-sale materials and offers
special introductory discounts to retailers. Lopez uses:
a. functional marketing.
b. relationship selling.
c. consumer promotions.
d. startup marketing.
e. trade promotions.
Answer:
When writing codes of ethics, businesses must ensure their codes deal with every
possible situation.
a. True
b. False
Answer:
The role of a domestic company that sells to an export merchant (also called a buyer for
export) is to:
a. guide the marketing actions of the merchant as the goods are sold in foreign
countries.
b. pay all transportation, warehousing, and marketing expenses.
c. sell the product to that merchant who resells the product in the foreign country
without the aid or input of the original manufacturer.
d. broker a partnership agreement such as a joint venture.
e. dictate conditions of sale in foreign countries.
Answer:
The promotional mix consists of:
a. advertising, publicity, direct marketing, and personal selling.
b. public relations, direct marketing, personal selling, and publicity.
c. product, promotion, price, and place.
d. advertising, public relations, sales promotion, personal selling, and social media.
e. advertising, telemarketing, public relations, and sales promotions.
Answer:
MethodistChurch
In 2001, the United Methodist Church, the second-largest Protestant denomination in
the United States, launched a four-year, $20 million national ad campaign. The
theologically gentle but culturally edgy ads are aimed at Americans who are
unchurched""people who know the name "Methodist" but don"t know anything else
about it. The "Igniting Ministries" ads have appeared on CBS and cable television. The
purpose of the ads is to draw more people through Methodist Church doors in a time
when mainline Protestant denominations are struggling.
Refer to Methodist Church. A news article about the Methodist Church that appeared in
the RomeNews-Tribune was an example of which promotional mix element?
a. Advertising
b. Sales promotion
c. Pull strategy
d. Public relations
e. Personal selling
Answer:
All of the following are examples of trade sales promotions EXCEPT:
a. push money
b. store demonstrations
c. premiums and coupons
d. free merchandise
e. trade shows
Answer:
Apple, Inc. used its Mac and PC guy ad in countries around the world. The company
simply modified the characters a bit to fit the culture. Apple is attempting to market the
Mac using:
a. standardized marketing practices.
b. mixed marketing.
c. character standardization.
d. global marketing standardization.
e. product invention.
Answer:
_____ occurs when consumers remember only information that supports their personal
feelings or beliefs.
a. Intermittent reinforcement
b. Selective exposure
c. Selective retention
d. Faulty selectivity
e. Selective distortion
Answer:
When a homeowner visited The Home Depot to buy what he thought he needed to fix a
leaking toilet, he gathered up materials totaling almost $70. One his way to check out,
an employee asked him what was he trying to fix. After some discussion, the employee
convinced the homeowner that a $5.99 replacement part would fix the problem better
than the materials he thought he needed and with less trouble. This sort of discussion
between employees and customers is commonplace at The Home Depot and indicates
the retail store has a(n) orientation.
a. sales
b. market
c. product
d. exchange
e. production
Answer:
Customer-centric is an internal management philosophy similar to the marketing
concept.
a. True
b. False
Answer:
NAICS data are helpful for analyzing, segmenting, and targeting markets. The system
was developed by:
a. large manufacturers in United States and Mexico that produce similar goods.
b. the North American Free Trade Agreement partners.
c. Brazil, Chile, Argentina, Canada, and the United States working together in a joint
venture.
d. the SIC committee.
e. the U.S. government.
Answer:
Through the use of automatic shipping notices, Ace Hardware is effective at removing
unnecessary costs from its supply chain. According to a VP of inventory for the retailer,
"Information gathering that used to take three or four phone calls now is available
immediately." This is an example of the use of integration.
a. relationship
b. social
c. functional
d. technology and planning
e. internal operations
Answer:
All of the following are practical ideas that marketing managers should consider when
setting social media objectives EXCEPT:
a. promoting products and services.
b. listening and learning.
c. building relationships and awareness.
d. creating static messages to reach mass audiences.
e. reaching out to unhappy customers and engaging them directly.
Answer:
Many high-end hotel chains award points for every dollar spent in one of their hotels.
Customers who earn a high number of points are given special privileges that may
include upgraded hotel rooms or several free nights. This is an example of the
leveraging of customer information to:
a. retain loyal customers.
b. reinforce competitive promotional decisions.
c. cross-sell other products and services.
d. design targeted marketing communications.
e. induce product trial by new customers.
Answer:
Interface
Interface, a manufacturer of floor covering products, has recently entered into an
agreement with Cargill, Inc. and Dow Chemical Company to develop a carpet
manufactured from corn fiber rather than the traditional nylon. Interface hopes to
develop a biodegradable carpet tile that will be sold to the public at prices only slightly
higher than nylon carpet tiles. Interface's CEO has repeatedly said the mission of his
company is to look for manufacturing materials that are renewable and not petroleum
dependent.
Refer to Interface. A consumer who was in the market for floor covering would be most
likely to locate information on the biodegradable floor tiles during which stage of the
consumer decision-making process?
a. Evaluation of alternatives
b. Internal information search
c. External information search
d. Need recognition
e. Postpurchase behavior
Answer:
Noah perceives the purchase of a tattoo to be a socially risky decision because he thinks
that people will judge him unfairly if he has a tattoo. Hayley, however, does not
perceive getting a tattoo as particularly risky behavior. As far as social risk is
concerned, getting a tattoo will be a higher-involvement activity for Noah than for
Hayley.
a. True
b. False
Answer:
Customers are on social media, and they expect their favorite brands will be there as
well.
a. True
b. False
Answer:
CallawayGolfCo.
Callaway Golf Co. has long been a leader in women's golf equipment, but it wanted to
expand its lead in this growing sector of the market. While Callaway's technical people
knew what could be done with design, they did not know exactly what women wanted
in their clubs. Callaway management decided what it needed to do was to bring the
technicians and women golfers together. Beginning about three years ago, Callaway
sent a team of researchers, designers, and golf pros out to visit with 40 women golfers
of various abilities in locations from California to Florida. In selecting the golfers to
study, Callaway decided to focus on women who were just beginning to play, as well as,
experienced, competitive golfers who wanted to own the latest equipment. Callaway
management felt that these two extreme groups of golfers had been overlooked by golf
club manufacturers. Further, Callaway felt that if enough could be learned about these
two groups, then the company would also learn enough to serve the rest of the women
golfer market. Basically, the research team observed the women playing golf and
listened to their comments and concerns. The information gathered by this research
team was built into every aspect of the design of a new golf club, including the feel of
the club, the length of the club shaft and size of the club head, and the weight of the
club. When prototypes of the new clubs were completed, they were sent to the women
golfers to get their feedback. That feedback was then used to refine the club design.
This process went on until the women said the new clubs greatly enhanced their game.
The entire process from original prototype to final product took a little less than one
year.
Refer to Callaway Golf Co. When Callaway researchers asked questions like "What
bothers you the most about your irons?" what type of questions were they asking?
a. Scaled response
b. Close-ended
c. Dichotomous
d. Open-ended
e. Multiple answer
Answer:
Which service quality component is the knowledge and courtesy of employees and their
ability to convey trust?
a. Reliability
b. Responsiveness
c. Assurance
d. Empathy
e. Tangibles
Answer:
Yield management systems can only be used by service industries.
a. True
b. False
Answer:
Novartis created the Novartis Research Institute for Tropical Diseases in Singapore. The
institute is unique because it is a not-for-profit organization that focuses on the
discovery of new drugs for the treatment of neglected diseases, such as dengue fever
and tuberculosis. Not only is this good business, it is also:
a. mandated by Supreme Court rulings
b. socially responsible
c. not ethically motivated
d. demonstrating a lack of concern for diversity
e. using environmental marketing
Answer:
Jane graduated from high school in 1978, is married, and has two teenage children.
Most of Jane's friends from high school have children who have already graduated from
college and gotten married, and some have grandchildren. Jane and her former
classmates are at different stages of the:
a. internalization phase.
b. segmentation process.
c. family life cycle.
d. psychographic cycle.
e. maturation process.
Answer:
