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Trying to maximize short-run return on investment may not be compatible with a
company's other objectives.
The marketing strategies for the two shoe retailers Payless and Zappos are very
different, and Zappos' strategy is successful while Payless' strategy is not.
Because too much sales data can drown a manager, it's best to start by asking only for
breakdowns that involve customer type.
The target return figure is zero for an organization that sets a price level that will just
recover costs.
In the market introduction stage of the product life cycle, if a firm has economies of
scale and expects competitors to enter the market soon, it would be wise to adopt a
skimming pricing policy.
A virtual corporation may enjoy flexibility in operations, but often at higher cost or with
less control of quality and schedules.
Sales managers often divide sales force responsibilities based on the seniority of the
salespeople.
Human resource issues can be especially important when there is a need to implement a
new marketing plan that involves major changes in the organization.
The pushing approach recognizes the value of cooperation among firms in a distribution
channel.
Statistical packages and information systems that produce graphs and charts can make it
easier to see patterns that are hidden in a table of numbers.
A high percentage of new-product ideas survive to the commercialization step in the
new-product development process.
A firm's average fixed cost increases as its output increases.
Advertising can increase demand for the product resulting in economies of scale in
manufacturing, distribution, and sales.
The micro view of marketing is mainly concerned with the activities performed by
organizations.
Chipotle has achieved success because its customers typically view the benefits of
buying its products as greater than the costs.
Consumer products which are bought often, routinely, and without much thought are
staples.
Unfavorable trends in the domestic marketing environment may make the international
marketing environment very attractive.
According to the Hierarchy of Needs, consumers are motivated to first satisfy their
higher-order needs, then they will focus on their lower-level needs.
Profit maximization objectives lead to high prices and monopoliesand are generally not
in the public interest.
Although we talk about close "relationships" between firms in business markets, in
practice it is just the relationship between the salesperson and purchasing manager that
becomes close.
Experience shows that it doesn't make sense for marketing managers to allocate costs to
specific market segments or products.
Prospecting involves following all the leads in the target market to identify potential
customers.
If customers in other countries are interested in the products a firm offers, or could
offer, serving them may improve economies of scale.
The moral standards that guide marketing decisions and actions are called marketing
ethics.
The Internet is making even straight rebuys more competitive.
Wants are the basic forces that motivate a person to do something.
Use of the scientific method in marketing research forces researchers to use an
inflexible process.
The fastest rate of growth in GDP is occurring in the nations with the largest current
GDP.
A marketing mix consists of the uncontrollable variables which a company puts
together to satisfy a target market.
It is against the law for industrial buyers to accept promotion items from suppliers.
Franchising now accounts for about a third of all retail sales.
In 2010, half of all American households earned more than $75,442.
Attitudes are very good predictors of intention to buy.
A service is not a "Product" because services do not include any physical good.
A business buyer who uses general purpose and/or specialized search engines may
reduce the need to arrange for custom-produced items.
Most direct marketing communications are designed to prompt immediate feedback.
It would probably be a bad idea to go to work as a salaried salesperson selling
installations for a firm that didn't have any working capital.
Convenience food stores now compete with supermarkets, gas stations, and fast-food
outlets.
Eating places spend a higher percentage of their sales on advertising than do
amusement parks.
A consumer panel is a group of consumers who provide information on a continuing
basis.
Which of the following statements about customer equity is FALSE?
A. Expected losses depend on customer equity.
B. If the parts of a firm's marketing program work well together, it should increase the
firm's customer equity.
C. Expected profits depend on customer equity.
D. Customer equity benefits customers but not the company.
E. None of these statements about customer equity is FALSE.
A "marketing plan" is:
A. a marketing program.
B. a marketing strategy.
C. a marketing strategy--plus the time-related details for carrying it out.
D. a target market and a related marketing mix.
E. a plan that contains the necessary operational decisions.
A college student on her way to take an exam remembers that she doesn't have a pencil
with an eraserwhich the instructor asked everyone to bring. The store where she stops
doesn't have regular pencilsbut it does sell Scripto mechanical pencils priced at $2.95.
That is what she buys. This case illustrates the effect of:
A. personal environment.
B. culture.
C. purchase situation.
D. learned set.
E. dissonance.
Small farmers in the mountains of Peru pick coffee beans by hand, obtaining only a
bucket a day. Then they sell them to buyers who put the beans in large bags to be
shipped to processors. This regrouping activity is called:
A. Assorting.
B. Wholesaling.
C. Bulk-breaking.
D. Sorting.
E. Accumulating.
TopKnotch Mfg. Co. has a production cost of $280. It sells its product to a wholesaler
for $400. The wholesaler then sells the item to retailers for $500 and the retailers sell
the item for $1,000. Which of the following is true about this "markup chain?"
A. The wholesaler's markup is 25 percent.
B. The manufacturer is taking a markup of 30 percent.
C. The retailers' markup is 100 percent.
D. None of these alternatives is true for this markup chain.
Marie Callender has developed a new brand of frozen dinners to compete with the
well-established brands. It probably should use a marketing mix of:
A. exclusive distribution, skimming pricing, and persuasive advertising.
B. intensive distribution, introductory price dealing, selective demand advertising, and a
combined "push" and "pull" policy.
C. intensive distribution, price cutting, reminder advertising, and a "pull" policy.
D. selective distribution, penetration pricing, pioneering advertising, and a "push"
policy.
E. selective distribution, skimming pricing, selective demand advertising, and a "push"
policy.
Truck wholesalers:
A. usually sell perishable products that other wholesalers prefer not to carry.
B. don't own the products they sell.
C. usually sell in large quantities, e.g., truckloads.
D. don't stock the products they sell.
E. None of these alternatives is correct for truck wholesalers.
"MRO items" are:
A. supplies.
B. natural products.
C. modified rebuy orders.
D. accessory equipment.
E. component parts and materials.
A grocery store sprays an aerosol scent that smells like fresh baked bread near its
packaged bakery items. This is
A. a case of a manager developing a need.
B. likely to have no effect because selective retention will eliminate any effect of the
smell.
C. a case of linking a response with a drive.
D. an example of trying to link a cue with a marketing mix.
E. a violation of the selective processes.
A number of independent drugstores are working with a wholesaler to obtain economies
of scale in buying. They were organized by this wholesaler after a recent meeting to
discuss ways of competing with corporate chains. These drugstores are now part of a:
A. corporate chain.
B. voluntary chain.
C. consumer cooperative.
D. cooperative chain.
E. franchise chain.
Trucks
A. are best at moving large quantities of goods for longer distances.
B. are the most expensive of any of the modes.
C. are very slow compared to railroads, and this makes it hard to compete effectively.
D. compete aggressively with other modes for high-value shipments.
E. None of these alternatives is correct.
Rob Rose sat back to review the portfolio of products his company, Wire Products Inc.
(WPI), has in its product line. The company specializes in making various products for
consumer and industrial uses from hard laminated wirecoated with special paints.
1) WPI's "Wire Closet" products have been on the market for 10 years. Consumers
install the wire shelves and closet rods themselves. The market leader, Closetmaid, has
been selling similar products for more than 20 years, but so far the sales volume and
profits for the market continue to grow. Recently, several new competitors have come
into the market.
2) Three months ago, WPI entered the lawn and garden market with folding fences
made with laminated wire and branded as "Wire Fold-Fence." Previously, WPI had
never made fences or been a player in the lawn and garden market-although other
companies have been making products in this market for years. However, Rob Rose has
discovered that recent sales of wire garden fencing have leveled off and profits are
declining overall. Still, WPI thinks it has some cost advantages and can grow its own
sales and profits in this market.
3) WPI has just developed "Oil Wire," a new concept for the environmental cleanup
market. Oil Wire is coated with a special material that cleans up oil spills. There has
never been a product like this and WPI wants to quickly get the word out about its
benefits. The product is now being rolled out in selective markets.
4) Another business product is "Wire Locker" used for secure storage by gymnasiums
or companies. This style of locker has now gone out of fashion and most customers are
finding better materials to use for lockers. Aggressive selling has helped Wire Locker's
sales stay flat, but the total market for wire style lockers is only half of what it was 10
years ago.
5) WPI's "Wire Window" product is used as a security product to protect glass
windows. It sells to homeowners and retailers looking for additional safety. WPI's sales
of this product have dropped in recent years because competitors have introduced
maintenance-free products. However, the overall market for this type of product
continues to show good growth.
6) WPI is running concept tests of a new wire car-top carrier called "Wire Car Top."
There are other car-top carrier products on the market, but WPI plans to include options
in its carrier that will make it easier to load bikes, skis, and suitcases. "Wire Car Top" is
also very easy to put on and take off of the car because of its light weight and
ease-of-use features. The concept tests are helping WPI analysts develop rough
estimates of costs, sales, and profits.
7) Another new product idea, tentatively called "Wire Tent," is being considered. It
would use laminated wires to create a portable tent frame. This product is currently
being evaluated to determine its fit with the company's objectives and external market
trends.
Rob is thinking about the product life cycle, where each product fits, and what he
should be doing as part of his marketing plan for each of these products.
In which stage of the product life cycle is "Oil Wire"?
A. Market introduction
B. Sales decline
C. Market growth
D. Market maturity
E. Market development
Which method of data collection is typically best when you want respondents to quickly
answer a small number of fairly simple questions?
A. Telephone
B. Mail
C. Observation
D. Experiment
E. Secondary
The LATE MAJORITY:
A. make a lot of use of mass media.
B. respond more to social pressure from other late adopters than to salespeople.
C. make a lot of use of salespeople.
D. use salespeople and have much contact with the early majority.
E. have a lot of contact with early adopters.
Which of the following observations is true?
A. The break-even point can also be figured in dollars.
B. For a single price, multiple break-even points are possible.
C. Beyond the break-even point, profits will grow continually.
D. At break-even point, a firm will cover only its variable costs.
E. At break-even point, a firm will cover only its fixed costs.
"Promotion" is MAINLY concerned with:
A. obtaining a favorable corporate image.
B. telling the target market that the right Product is available in the right Place at the
right Price.
C. obtaining maximum publicityat the lowest cost.
D. informing the public about the firm's offerings to maximize sales.
E. getting people to buy a firm's producteven when it isn't needed.
Macro-marketing examines all the following challenging scenarios except:
A. Producers prefer to manufacture goods in large quantities, but consumers buy in
small quantities.
B. Consumers require a wide assortment of food items, but individual producers can
offer only a narrow assortment of food products.
C. Producers set prices to cover costs and make a profit, but consumers choose goods
based on their ability to pay.
D. Cedar Point Amusement Park would like to attract customers all year long, but its
marketing strategy is currently limited to discount season pass offers during winter
months while the park is closed.
E. Producers tend to locate where it is economical to produce, but consumers are
located in many scattered places.
______ refers to the people to whom an individual looks when forming attitudes about
a particular topic.
A. Family
B. A social class
C. An ethnic group
D. A focus group
E. A reference group
Regarding retail sales in the U.S., it is true that:
A. less than 6 percent of all retail sales are made by smaller storesthose with sales less
than $1 million a year.
B. almost 75 percent of all retail sales are made by the largest storesthose with sales
over $5 million a year.
C. corporate chains account for about 50 percent of retail sales.
D. franchising accounts for one-third of retail sales.
E. All of these alternatives are correct.
When an auto repair shop calls an auto parts wholesaler to order the parts to fix a
wrecked vehicle, the person who answers the repair shop's questions is a:
A. Missionary salesperson.
B. Technical specialist.
C. Wholesaler's order getter.
D. Supporting salesperson.
E. Wholesaler's order taker.
Which of the following statements about Place decisions is True?
A. Product classes are not related to Place objectives.
B. The product life cycle is not related to Place objectives.
C. Place decisions are short-term decisions that are easy to change.
D. Different market segments may require separate Place arrangements.
E. All of these statements about Place decisions are True.
___________ shopping products are products that the customer sees as basically the
same and wants at the lowest price.
A. Regularly unsought
B. New unsought
C. Specialty
D. Unsought
E. Homogeneous
Which of the following observations concerning different measures of national income
is TRUE?
A. GDP does not include income earned by foreigners who own resources in that
nation.
B. Using GNI can give the impression that people in less-developed countries have
more income than they really do.
C. GNI per capita is a useful figure because it gives some idea of the income level of
people in the country.
D. The less-developed nations account for the biggest share of the world's GDP.
E. GDP is the only measure of national income.
Unsought products:
A. require wide distribution but little promotion.
B. are generally unprofitable.
C. should not be marketed.
D. are products consumers want but can't find.
E. None of these alternatives is correct.
Multiple buying influence is MOST likely to occur in which of the following
purchases?
A. Note pads.
B. A voice-mail phone system.
C. A replacement for a broken chair.
D. Gasoline.
E. Paper clips.
The stage of the new-product development process in which marketers evaluate the
firm's strengths, weaknesses, and objectives is:
A. idea generation.
B. screening.
C. idea evaluation.
D. development.
E. commercialization.
A firm has just received an invoice for $1,000 with the following terms: 3/10, net 30. In
this case, the firm:
A. should not worry about earning the cash discount because the amount is small.
B. can take a 10 percent discount if it pays within 3 days, and otherwise the full amount
is due in 30 days.
C. can take a 3 percent discount if it pays the invoice on the 30th day.
D. in effect, will be borrowing at an annual rate of 54 percent if it pays the invoice in 30
days.
E. should pay $900 if it pays within 10 days.
If customers already have a positive attitude about a product, which promotional
objective would you recommend?
A. Inform.
B. Remind.
C. Persuade.
D. Educate.
E. Change position.
Ukrop's Supermarkets places the Ukrop's brand on a wide variety of products that are
only available in Ukrop's stores. The Ukrop's brand is referred to as a(n):
A. Global brand.
B. Manufacturer brand.
C. National brand.
D. Private brand.
E. Producer brand.
New products that are minor variations on existing products, and which require no
change to consumer behavior, are called _____.
A. fads
B. new products
C. second movers
D. discontinuous innovation
E. continuous innovations
At break-even point (BEP),
A. the firm's total revenue will equal its variable costs.
B. the firm's total sales will equal its total production.
C. the firm's total cost will equal its total revenue.
D. the firm's total profits will equal its total cost.
E. the firm's total variable costs equal its total fixed cost.
Data that has been collected or published already is:
A. primary data.
B. free.
C. franchised data.
D. secondary data.
E. None of these are good choices.
A manufacturer of lawn mowers pays for and provides local dealers with
professionally-produced commercials for its products. A dealer can pay to have its
name, address, and telephone number appear at the end of the commercial. The
commercials are much higher quality ads than most local lawn mower dealers could
afford by themselves. These commercials provided by the manufacturer for local use
are an example of:
A. Advertising allowances.
B. Cooperative advertising.
C. Vertical communication.
D. Horizontal integration.
E. None of these is a good answer.
The "iceberg principle":
A. explains why some firm's sales are "cooler" that others.
B. explains why some customers are more profitable than others.
C. suggests that sales will vary from one territory to another.
D. suggests that much good information may be hidden in summary data.
E. says that sales reps should never make "cold calls" on customers.
Regarding wholesalers, which of the following is the most numerous?
A. Service wholesalers.
B. Agent wholesalers.
C. Limited-function wholesalers.
D. Manufacturers' sales branches.
E. Merchant wholesalers.
