63) A(n) ________ system involves a single firm setting up two or more marketing channels to
reach one or more customer segments.
A) conventional distribution
B) corporate vertical marketing
C) horizontal marketing
D) administered vertical marketing
E) multichannel distribution
64) Atlas Imports and Exports sells products directly to consumers via the Atlas Web site, and
through local retailers as well. Which of the following is evident here?
A) corporate vertical marketing system
B) horizontal marketing system
C) multichannel distribution system
D) administered vertical marketing system
E) conventional distribution channel
65) Movie Giants offers DVD rentals through its Web site. It also offers DVD rentals via Star
City stores. This is an example of a(n)________ distribution system.
A) conventional
B) inclusive
C) intensive
D) extensive
E) multichannel
66) Which of the following is an advantage of adding new channels in a multichannel
distribution system?
A) limiting market complexity
B) reducing control over the system
C) expanding sales and market coverage
D) decreasing marketing needs and costs
E) minimizing mass customization of products
67) Which of the following is a disadvantage of adding new channels in a multichannel
distribution system?
A) decreasing complexity of markets
B) decreasing control over the system
C) reducing opportunities for franchising
D) lowering sales and market coverage
E) minimizing publicity needs
68) ________ occurs when product or service producers cut out intermediaries and go directly
to final buyers or when radically new types of channel intermediaries displace traditional ones.
A) Extensive distribution
B) Multichannelization
C) Disintermediation
D) Inclusive distribution
E) Cross merchandising
69) The Bookworm began delivering books directly to customers through mail instead of
selling through brick-and-mortar companies. This is an example of ________.
A) indirect marketing
B) disintermediation
C) franchising
D) exclusive distribution
E) intensive distribution
70) Which of the following is true of changes in the organization of distribution channels?
A) Developing new channels seldom causes conflict with a company’s established channels.
B) To remain competitive, product and service producers must use fewer marketing channels.
C) The growth of the Internet threatens many brick-and-mortar companies with
disintermediation.
D) Companies have fewer channel options today than they did in the past due to economic
problems.
E) Advances in technology have decreased the number of channels available to entrepreneurial
firms.
71) A marketing channel works most effectively when each channel member performs the tasks
it does best.
72) Horizontal conflicts are conflicts between different levels of the same channel.
73) Vertical conflict occurs among firms at the same level of the channel.
74) A conventional distribution channel consists of one or more independent producers,
wholesalers, and retailers; each seeking to maximize its own profits, perhaps even at the
expense of the system as a whole.
75) A non-corporate VMS integrates successive stages of production and distribution under
single ownership.
76) In a vertical marketing system, two or more companies at one level join together to take
advantage of a new marketing opportunity.
77) Disintermediation occurs when radically new types of channel intermediaries displace
traditional ones.
78) What is horizontal conflict? Illustrate your answer with an example.
79) What is vertical conflict? Illustrate your answer with an example.
80) What is a conventional distribution channel?
81) Explain power in a vertical marketing system.
82) How can a firm benefit from involvement in a contractual VMS?
83) How can a firm benefit from participating in a horizontal marketing system?
84) Give an example of a multichannel distribution system.
85) Compare a conventional distribution channel with a vertical marketing system (VMS).
86) What are the advantages of multichannel distribution systems?
87) How have changes in technology and the growth of online marketing affected the design of
marketing channels?
88) Which of the following should be a manufacturer’s first step when designing an effective
marketing channel?
A) set channel objectives
B) analyze consumer needs
C) identify channel alternatives
D) evaluate channel alternatives
E) establish strategic alliances
89) Which of the following is NOT a step in designing an effective marketing channel?
A) evaluating the channel alternatives
B) identifying major channel alternatives
C) analyzing consumer needs
D) determining pricing policy for channel members
E) setting channel objectives
90) In designing the marketing channel, a company must balance customer needs and wants
with ________.
A) the need to make a profit
B) the requirement to find channel members to fill all the steps
C) the firm’s position in the customers’ minds
D) the desire to be “the best” in all service areas
E) the firm’s resources and skills to provide all the desired services
91) The company’s channel objectives are influenced by all of the following EXCEPT
________.
A) the company’s marketing intermediaries
B) the company’s competitors
C) the age of the company
D) the nature of the company
E) the company’s products
92) Which of the following is an environmental factor that affects channel objectives and
design?
A) economic conditions
B) factory staffing
C) organizational objectives
D) interpersonal influences
E) individual motives
93) ________ distribution is a strategy in which producers of convenience products and
common raw materials stock their products in as many outlets as possible.
A) Direct
B) Intensive
C) Inclusive
D) Exclusive
E) Selective
94) For which of the following products would the intensive distribution strategy most likely be
used?
A) high-end cameras
B) luxury cars
C) lawn mowers
D) soft drinks
E) furniture
95) Whitelight sells its toothpastes in many convenience stores across the country. This is an
example of ________ distribution.
A) exclusive
B) selective
C) hybrid
D) intensive
E) normal
96) With which of the following strategies would a company give only a limited number of
dealers the right to distribute its products in their territories?
A) exclusive distribution
B) extensive distribution
C) moderate distribution
D) primary distribution
E) intensive distribution
97) For which product would a company use an exclusive distribution strategy?
A) luxury cars
B) newspapers
C) chewing gum
D) dairy products
E) soft drinks
98) Ocean Spray sells its air fresheners only through Ray’s Drugs. This is an example of
________ distribution.
A) exclusive
B) selective
C) intensive
D) indirect
E) corporate
99) ________ distribution involves the use of more than one but fewer than all of the
intermediaries who are willing to carry a company’s products.
A) Exclusive
B) Selective
C) Intensive
D) Indirect
E) Corporate
100) Craftsman Furniture Company offers its bedroom and living room furniture through
independent and smaller chain furniture stores, not through every store that sells furniture. It
uses ________ distribution.
A) intensive
B) direct
C) corporate
D) selective
E) exclusive
101) Which of the following is true of the exclusive distribution strategy?
A) It makes products available to everybody, everywhere.
B) It is used primarily for convenience items.
C) It helps promote a brand’s luxury image.
D) It gives producers no control over their products.
E) It enlists all of the intermediaries willing to carry a company’s products.
102) When the seller allows only certain outlets to carry its products, this strategy is called
________.
A) exclusive distribution
B) subjective dealing
C) selective distribution
D) exclusive pricing
E) disintermediation
Refer to the scenario below to answer the following question(s).
Giant Beanstalks is a company based in Maryland that processes and cans vegetables. It has
contracts with several large farms in Riverdale, 80 miles away from the factory, that agree to
sell their produce to Giant Beanstalks. The company’s products are available to the public only
through Greenleaf, a grocery chain with 38 stores in the country.
103) What distribution strategy does Giant Beanstalks use?
A) inclusive distribution
B) exclusive distribution
C) selective distribution
D) intensive distribution
E) extensive distribution
104) Which of the following is NOT a criterion a company will use to evaluate the major
channel alternatives?
A) adaptability
B) control
C) commitment
D) sales and costs
E) likability
105) Why do firms have difficulty accessing potential market areas in developing countries,
such as China and India?
A) inadequate distribution systems
B) anti-globalization efforts
C) highly centralized rural markets
D) limited manpower
E) high operating costs
106) Multichannel marketing occurs when a single firm sets up two or more marketing
channels to reach one or more customer segments.
107) Marketing channel design calls for analyzing consumer needs, setting channel objectives,
identifying major channel alternatives, and evaluating those alternatives.
108) Producers of convenience products and common raw materials typically seek exclusive
distribution, a strategy in which they stock their products in as many outlets as possible.
109) Under the strategy of intensive distribution, the producer gives only a limited number of
dealers the exclusive right to distribute its products in their territories.
110) The producer informs each channel member what its responsibilities are, and what the
terms of business are.
111) Describe the types of products that are intensively distributed and provide examples.
112) Describe the types of products that are exclusively distributed and provide examples.
113) Describe the types of products that are selectively distributed and provide examples.
114) Compare the three distribution strategies that producers use, providing examples of
products for each type of distribution.
115) ________ management calls for selecting, managing, and motivating individual channel
members and evaluating their performance over time.
A) Inventory
B) Marketing channel
C) Brand image
D) Customer experience
E) Brand content
116) To help recruit, train, organize, manage, motivate, and evaluate relationships with channel
partners, companies are now installing integrated high-tech ________ systems.
A) advertiser funded programming
B) customer segmentation network
C) brand content management
D) partnership relationship management
E) closed loop marketing
117) Producers motivate channel members using all of the following EXCEPT ________.
A) using strict rules to force compliance with contract terms
B) partner relationship management
C) working to sell through the intermediaries
D) persuading the intermediaries that they are first-line customers
E) convincing channel members that each will enjoy greater success working together with a
common goal
118) When a seller requires its dealers to abstain from handling competitors’ products, it is
called ________.
A) subjective distribution
B) exclusive dealing
C) selective distribution
D) exclusive pricing
E) disintermediation
119) A strategy of exclusive dealing is most likely considered legal if ________.
A) the industry is newly developed
B) both parties have large territories
C) competition is not substantially lessened
D) the dealer agrees to promote the competitor’s products
E) the dealer receives a steady source of supply and support