Independent off-price retailers purchase merchandise at rates that are substantially
higher than regular wholesale rates.
Answer:
Target costing starts with an ideal selling price based on customer value considerations
and then aims at costs that will ensure that the price is met.
Answer:
Demographic variables are generally more difficult to measure than most other types of
variables.
Answer:
An independent logistics provider that performs all of the functions required to get a
client’s product to market is known as a third-party logistics (3PL) provider.
Answer:
Properly designed and targeted telemarketing provides many benefits, including
purchasing convenience and increased product and service information.
Answer:
Marketing critics claim that the inevitable outcome of successful marketing is
unsustainable overconsumption.
Answer:
Direct marketing is the optimal promotion tool for building personal and long-lasting
relationships with customers.
Answer:
Shopper marketing involves focusing the entire marketing process from product and
brand development to logistics, promotion, and merchandising toward turning shoppers
into buyers at the point of sale.
Answer:
The position of a strategic business unit in the growth-share matrix typically remains
constant over time.
Answer:
Internal databases usually are more expensive to use than other market information
sources.
Answer:
Companies are adapting their promotional efforts to reflect the changing dynamics of
American families.
Answer:
Line extensions occur when a company extends existing brand names to new or
modified products in a new category.
Answer:
An organization’s mission statement should emphasize its intentions toward customers
and the customer experience the organization seeks to create.
Answer:
A brand extension gives a new product instant recognition and faster acceptance.
Answer:
Each basic consumer right has led to more specific proposals from consumerists, such
as nutritional and ingredient labeling.
Answer:
In a retailer cooperative, independent retailers band together to set up a jointly owned,
central wholesale operation and conduct joint merchandising and promotion efforts.
Answer:
Through consumer-generated marketing, consumers themselves are playing a bigger
role in shaping their own brand experiences and those of others.
Answer:
Companies like Coca-Cola and Facebook deliver customer satisfaction by spreading
happiness and connecting individuals through shared experiences.
Answer:
Since suppliers are so close to the market, they are valuable sources of information
about consumer problems, marketing opportunities, and new product possibilities.
Answer:
An abstract presentation of a product concept is likely to increase the reliability of the
concept test.
Answer:
Merchant wholesalers are the largest single group of wholesalers, accounting for
roughly 50 percent of all wholesaling.
Answer:
There is no true substitute for coffee. If the price goes from $8 to $12 for a package of
k-cups due to a coffee bean shortage, demand will remain relatively unchanged. This is
an example of demand elasticity.
Answer:
A business buyer typically makes the greatest number of decisions in a straight rebuy
situation and the fewest in a new-task situation.
Answer:
Media impact is the qualitative value of message exposure through a given medium.
Answer:
Sales managers use sales reports, personal observations, and customer surveys to assess
the performance of sales-force members.
Answer:
Companies that practice perceived obsolescence use product components that will
break, wear, rust, or rot sooner than they should.
Answer:
Demographic factors are the most popular bases for segmenting customer groups.
Answer:
Marketing critics claim that the overselling of private goods results in social costs.
Answer:
An SBU can be a company division or a product line within a division, but not a single
product or brand.
Answer:
Commissions and bonuses are variable amounts of compensation.
Answer:
The Federal Trade Commission enforces laws that prevent unfair competition in
business.
Answer:
The installation of an innovation management system allows a company to collect,
review, evaluate, and manage new product ideas.
Answer:
What are the two main types of research instruments used to collect primary data?
A) observation scales and personal interviews
B) questionnaires and mechanical devices
C) focus groups and mechanical devices
D) focus groups and questionnaires
E) personal interviews and online focus groups
Answer:
A product life cycle has five distinct stages: product development, introduction, growth,
maturity, and ________.
A) stabilization
B) rebranding
C) decline
D) progression
E) segmentation
Answer:
Koffee, a brand of instant coffee, gives away a free coffee mug with its logo imprinted
on it with every purchase of a 500g packet of its instant coffee powder. Which
promotion tool is Koffee using?
A) coupons
B) price packs
C) samples
D) advertising specialties
E) rebates
Answer:
Susan Hart, the manager of a children’s boutique, collects data from her monthly
records of sales, costs, and cash flow. In this case, Susan is making use of ________
databases.
A) external
B) secondary
C) historical
D) internal
E) dialog
Answer:
Which of the following is true of the Privacy Promise launched by the Direct Marketing
Association (DMA)?
A) It forbids all DMA members from spending excessively on digital advertising.
B) It requires all DMA members to notify customers when any personal information is
rented, sold, or exchanged with others.
C) It recommends that DMA members help each other by sharing customer
psychographic data.
D) It forbids DMA members from sending e-mail, mail, or phone offers to any
customer.
E) It encourages DMA members to create more digital content that is tailored for
children under age 13.
Answer:
Greentech is launching a line of miniature solar chargers for laptops, cellphones, and
other electronic devices. The chargers are compact, affordable and the green energy
technology is a value-added benefit for both the company and consumers. Which of the
following would qualify as an advertisement for Greentech’s new solar chargers?
A) a front-page notice of the release of Greentech’s solar chargers in all leading
newspapers
B) a press conference to discuss the various benefits, including environmental feature
C) the use of dedicated sales personnel to explain the qualities of the new solar chargers
to retailers
D) an endorsement by a national environmental organization to tout the benefits of the
new solar chargers
E) an online lottery where interested buyers have a chance to win a prize
Answer:
The aim of ________ is to make ads and brand content so engaging or useful that
people want to watch them.
A) branded entertainment
B) advertainment
C) social advertising
D) subliminal advertising
E) infotainment advertising
Answer:
Faber Motors manufactures three lines of cars: high-end security cars for government
agencies, commercial cars for consumers and individuals, and professional racing cars.
The high-end security cars are sold directly to government buyers by the company. The
consumer cars are sold through dedicated dealers who only sell Faber’s lines at their
outlets. For its professional racing cars, Faber collaborates with Radium Tires, an
innovative and renowned tire manufacturer. Faber provides the engine and body, while
Radium provides the tires and its expertise on the racing industry. Which term best
describes Faber’s channel arrangements?
A) direct distribution system
B) horizontal marketing system
C) corporate vertical franchise system
D) multichannel distribution system
E) administered vertical marketing system
Answer:
In a SWOT analysis, which of the following would be considered a weakness of a
company?
A) an unfavorable economic climate that discourages consumption
B) the exit of a competitor from the market
C) inflation that leads to higher prices of the company’s products
D) falling consumer interest in its products
E) obsolete technologies used by the company
Answer:
Which of the following types of promotion tools requires a considerable degree of
personal interaction with a customer?
A) digital advertising
B) personal selling
C) sales promotion
D) public relations
E) television advertising
Answer:
The ________ concept holds that achieving organizational goals depends on knowing
the needs and wants of target markets and delivering the desired satisfactions better
than competitors do.
A) marketing
B) product
C) production
D) selling
E) societal marketing
Answer:
Stew Leonard’s has created what has been the “Disneyland of Dairy Stores,” complete
with costumed characters, scheduled entertainment, and a petting zoo. It’s built 30
additions onto the original store, which now serves more than 300,000 customers each
week. This legion of loyal shoppers is largely a result of the store’s passionate approach
to customer service. Instead of focusing on individual transactions, Stew and his staff
are putting a priority on ________.
A) decreasing customer-perceived value
B) managing partner relationships
C) attracting “butterflies”
D) converting ‘strangers” into “butterflies”
E) capturing customer lifetime value
Answer:
Fargo Inc. is a carbonated beverage manufacturer that has many manufacturing plants
around the world. It is planning to shift from using thermal power to wind power for its
manufacturing plants in the Netherlands to decrease dependency on nonrenewable
sources of energy. This scenario depicts Fargo’s concern for its ________ environment.
A) economic
B) natural
C) demographic
D) political
E) cultural
Answer:
Coolers Inc. has decided to launch a new energy drink that will have the fewest calories
among its competitors. To understand the market potential for the new drink and the
demographics and attitudes of consumers who are likely to buy the product, Coolers
should most likely use ________.
A) exploratory research
B) archival research
C) causal research
D) experimental research
E) descriptive research
Answer:
________ marketing involve engaging directly with carefully targeted individual
consumers and customer communities to both obtain an immediate response and build
lasting customer relationships.
A) Undifferentiated and differentiated
B) Mass and targeted
C) Direct and digital
D) Internal and external
E) Standardized and customized
Answer:
Which of the following is a traditional right of buyers?
A) the right to charge any price for a product, provided no discrimination exists among
similar kinds of buyers
B) the right to spend any amount to promote a product, provided it is not defined as
unfair competition
C) the right to use any product message, provided it is not misleading or dishonest in
content or execution
D) the right to use buying incentive programs, provided they are not unfair or
misleading
E) the right not to buy a product that is offered for sale
Answer:
Which of the following is most likely a characteristic of firms that adopt a reactive
approach toward the marketing environment?
A) They develop strategies to change the marketing environment.
B) They take advantage of the opportunities provided by the environment.
C) They take aggressive actions to affect the marketing environment.
D) They view the marketing environment as a controllable element.
E) They do not accept the marketing environment as it is.
Answer:
Which of the following is true of strategic planning in a firm?
A) It deals with maintaining the company’s current business ventures.
B) It focuses on the firm’s internal environment rather than the external environment.
C) It occurs at the business-unit, product, and market levels rather than at the corporate
level.
D) It deals with adapting the firm to take advantage of changing marketing
opportunities.
E) It involves preparing short-term investment objectives at the product level.
Answer:
Which of the following is true about trends in wholesaling?
A) New laws prevent wholesalers from having their own retailing operations.
B) Value-added customer relationships have been replaced by control systems.
C) Merchant wholesalers are decreasing in number and relevance.
D) The demand for lower prices and higher quality has increased.
E) Bulk breaking is increasingly popular and necessary.
Answer:
Cosmetics firm SatinSilk is revamping its mission statement and advertising strategy.
The CEO stresses that the new mission statement should be market-oriented rather than
product-oriented. Which of the following mission statements will best suit the
company?
A) to create the best possible products and sell them at the best possible prices
B) to sell hypoallergenic cosmetics products made only from the finest organic
ingredients
C) to give customers the complexion they dream about by providing products suited to
their needs
D) to become a market leader in every cosmetics product category
E) to increase our market share in the cosmetics segment and increase profit margins
Answer:
JetBlue’s promise to put “You Above All” by “bringing humanity back to travel” is their
________.
A) value proposition
B) segmentation strategy
C) market offering
D) selling concept
E) production concept
Answer:
Integrating the entire distribution chain from its own design and manufacturing
operations to distribution through its own managed stores has turned Spanish clothing
chain Zara into the world’s fastest-growing fast-fashion retailer. This is an example of
a(n) ________ marketing system.
A) contractual vertical
B) corporate vertical
C) administered vertical
D) horizontal
E) direct
Answer:
Ainsworth is a toy manufacturer based in Australia. Which of the following most likely
indicates that Ainsworth is following a diversification strategy?
A) Ainsworth increases its spending on advertising and promotion.
B) Ainsworth acquires the rights to manufacture toys resembling a popular cartoon
character.
C) Ainsworth introduces its toys in the Indian and South-East Asian markets.
D) Ainsworth enters the U.S. market with a line of children’s clothing.
E) Ainsworth develops a new line of educational toys targeting its current market.
Answer:
Which of the following is a disadvantage of straight product extension?
A) It involves additional product development costs.
B) It involves changing the product to meet local requirements.
C) It requires planning a new promotional strategy to promote the product.
D) It can be costly in the long run if products fail to satisfy consumers in specific global
markets.
E) It requires making changes in the manufacturing process.
Answer:
A country in South America has large reserves of copper and tin. Mining forms the
pillar of its economy. A major part of its revenue is generated from exporting these
resources. This country is poor in many other ways. It is a good market for large
equipment, tools, supplies, and trucks. Since there are many foreign residents in this
country and a wealthy upper class, it is also a market for luxury goods. This country
most likely has a(n) ________ economy.
A) subsistence
B) raw material exporting
C) emerging
D) developed
E) industrial
Answer:
The ________ concept specifically focuses on future company needs, but not the future
welfare of customers.
A) societal marketing
B) strategic planning
C) sustainable marketing
D) global marketing
E) cause marketing
Answer:
Which of the following statements is true of shopping centers?
A) Most shopping centers function at the regional level rather than at the neighborhood
level.
B) Shopping centers typically contain only those stores that target a niche market
segment of high income groups.
C) Shopping centers are groups of retail businesses built on a site that is planned,
developed, owned, and managed as a unit.
D) Shopping centers usually contain exclusive brands and specialty stores rather than
convenience stores or department stores.
E) Shopping centers are huge superstores that offer a deep assortment of a particular
product line.
Answer:
A ________ consists of producers, wholesalers, and retailers acting as a unified system.
The system can be dominated by any one of the interdependent members.
A) direct marketing system
B) horizontal distribution channel
C) lateral marketing system
D) conventional distribution channel
E) vertical marketing system
Answer:
Which of the following is an example of a horizontal conflict in a distribution channel?
A) a Nike shoe dealer complaining that the shoes provided to the dealer are defective
B) a Ford car dealer complaining that another Ford dealer is underpricing the same
models
C) a FedEx agent complaining that a DHL agent is cutting off his business
D) a Walmart executive complaining to a Pepsi executive for not replenishing stocks on
time
E) a Gucci executive complaining to Gucci’s suppliers of delays in shipping
consignments
Answer:
Which of the following is a desirable quality for a brand name?
A) The name should be unique and difficult to pronounce to ensure legal protection.
B) The name should be a common word rather than a distinctive one.
C) The name should not suggest anything about the product quality.
D) The name should translate easily into foreign languages.
E) The name should not be extendable.
Answer:
What is value selling? Explain its importance and requirements.
Answer:
Watson Insurance is an insurance company that provides coverage for personal property
and bodily injury. The company offers customized policy options for individual
customers. High levels of interaction with customers are needed so that the company
can provide the best customized service possible. What kind of promotional tool will
best help Watson Insurance to sell its policies to its target customers?
Answer:
What are the different ways of finding sales prospects?
Answer:
Shopard publishes FBerry, America’s longest running fashion magazine, from one
central location in Los Angeles. FBerry is the only product that Shopard handles. The
magazine is bought by millions of readers in the United States and Europe. Which type
of sales-force structure is most appropriate for Shopard? Why?
Answer:
What are marketing dashboards? How do they benefit marketers?
Answer:
Explain how an inside sales force should provide support to an outside sales force.
Answer:
Explain how wholesalers have been able to use technology to cut costs.
Answer:
Explain the four major steps in designing a customer-driven marketing strategy.
Answer:
Define marketing planning. Briefly outline what a company should cover in its
marketing plan.
Answer:
Describe product stewardship, design for environment (DFE), and cradle-to-cradle
practices.
Answer:
Why is it beneficial for a firm to coordinate its marketing and sales efforts? What
actions can a company take to bring its marketing and sales functions closer together?
Answer:
Compare the four types of products in the societal classification of products. Provide
examples of each type to illustrate your answer.
Answer:
Internet marketing practices have raised a number of ethical and legal questions. Why is
invasion of privacy perhaps the number-one online marketing concern?
Answer:
Differentiate between the three types of franchises and provide examples of each type.
Answer:
How has the new communications model changed the face of today’s marketing
communications?
Answer:
What are the main forms of direct and digital marketing?
Answer:
What is neuromarketing? How is neuromarketing used by marketers?
Answer:
Compare and contrast the product and production concepts.
Answer:
Jazz is a costume jewelry manufacturing company based in the United States. The
company decides to sell its products abroad, but it faces the major problem of price
escalation. What is price escalation? How can Jazz overcome this problem?
Answer:
Draw a comparison between the reactive and proactive approaches a company can take
toward a changing marketing environment.
Answer: