79) Mail order selling, catalog sales, telemarketing, interactive media, and televised home
shopping are all examples of
A) direct marketing channels.
B) indirect marketing channels.
C) multimedia marketing channels.
D) virtual marketing channels.
E) personal selling.
80) When you order a sweater from an L.L. Bean mail order catalog, what type of marketing
channel are you and the company using?
A) cash and carry marketing channel
B) intensive distribution channel
C) selective distribution channel
D) indirect marketing channel
E) direct marketing channel
81) The blending of different communication and delivery channels that are mutually reinforcing
in attracting, retaining, and building relationships with consumers who shop and buy in
traditional intermediaries and online is referred to as
A) direct marketing.
B) indirect marketing.
C) intensive marketing.
D) multichannel marketing.
E) electronic marketing.
82) Multichannel marketing is the blending of different ________ that are mutually reinforcing
in attracting, retaining, and building relationships with consumers who shop and buy in
traditional intermediaries and online.
A) pricing channels
B) media channels
C) communication and delivery channels
D) direct and indirect channels
E) development channels
83) ________ seeks to leverage the value-adding capabilities of both electronic marketing and
traditional delivery. Catalogs can serve as shopping tools for online purchasing, and websites can
help consumers do their homework before visiting a store.
A) Direct marketing
B) Indirect marketing
C) Intensive marketing
D) Multichannel marketing
E) Automated marketing
84) Multichannel marketing
A) can leverage the value-adding capabilities of different channels.
B) creates greater elasticity of demand for a firm’s products.
C) creates greater inelasticity of demand for a firm’s products.
D) allows a firm to legally circumvent paying taxes on revenue generated by online sales.
E) allows customers to avoid shipping and handling charges.
85) An arrangement whereby a firm reaches different buyers by employing two or more different
types of channels for the same basic product is referred to as
A) a strategic channel alliance.
B) multiple level selling.
C) parallel distribution.
D) dual distribution.
E) recursive distribution.
86) Dual distribution refers to
A) a level of distribution density whereby a firm selects a few retailers in a specific geographical
area to carry its products.
B) an arrangement whereby a firm reaches different buyers by employing two or more different
types of channels for the same basic product.
C) the blending of different communication and delivery channels that are mutually reinforcing
in attracting, retaining, and building relationships with consumers who shop and buy in
traditional intermediaries and online.
D) professionally managed and centrally coordinated marketing channels designed to achieve
channel economies and maximum marketing impact.
E) a practice whereby one firm’s marketing channel is used to sell another firm’s products.
87) In some instances, firms pair multiple channels with a multibrand strategy. The purpose of
this strategy is to ________ of the firm’s family brand and differentiate its marketing channels.
A) create greater perceived value
B) maximize channel profits
C) minimize cannibalization
D) generate awareness
E) create a “backup” channel
88) Pharmaceutical companies sell some of their products to hospitals and clinics directly. They
also market other products to large retail chains such as Walgreens that distribute them to their
stores across the nation. In addition, they sell products to drug wholesalers that sell to the
remaining independent drugstores in the United States. What method of distribution best
describes the method used by pharmaceutical companies in this example?
A) dual distribution
B) vertical distribution
C) horizontal distribution
D) direct distribution
E) exclusive distribution
89) Rather than compete with large greeting card companies for shelf space in supermarkets,
several smaller card companies place their cards in pack-and-ship stores where the customer can
mail a card on the spur of the moment, and in racks in car washes where customers who are
waiting for their cars can browse and purchase cards. This is an example of which type of
marketing channel strategy?
A) a strategic channel alliance
B) multichannel distribution
C) parallel distribution
D) dual distribution
E) direct distribution
90) A practice whereby one firm’s marketing channel is used to sell another firm’s products is
referred to as
A) dual distribution.
B) cooperative distribution.
C) an integrated channel alliance.
D) a multichannel venture.
E) a strategic channel alliance.
91) A strategic channel alliance refers to
A) an arrangement whereby a firm reaches different buyers by employing two or more different
types of channels for the same basic product.
B) a practice whereby one firm’s marketing channel is used to sell another firm’s products.
C) the blending of different communication and delivery channels that are mutually reinforcing
in attracting, retaining, and building relationships with consumers who shop and buy in
traditional intermediaries and online.
D) an arrangement whereby companies reduce distribution costs by sharing facilities, equipment,
and transportation.
E) a practice whereby consumers can interact with various advertising media to buy products
without a face-to-face meeting with a salesperson.
92) Which type of marketing channel arrangement is especially good for a firm to use in global
marketing where the creation of marketing channel relationships is expensive and time–
consuming?
A) dual distribution
B) cooperative distribution
C) strategic channel alliance
D) global distribution alliance
E) multichannel distribution
93) Nestlé and General Mills have ________ to distribute General Mills products like Cheerios
under the Nestlé brand name in about 140 markets worldwide.
A) multichannel distribution
B) a direct marketing channel
C) a cooperative distribution channel
D) a strategic channel alliance
E) a dual distribution agreement
94) Kraft Foods distributes Starbucks coffee in U.S. supermarkets and internationally. These
firms are most likely using ________ strategy.
A) multichannel distribution
B) a direct marketing channel
C) a cooperative distribution channel
D) a strategic channel alliance
E) a dual distribution agreement
95) In an example of ________, Kraft Foods uses the distribution system of Ajinomoto, a major
Japanese food company, to market its Maxwell House coffee in Japan.
A) a direct marketing channel
B) an industrial distribution system
C) a dual distribution system
D) a franchising operation
E) a strategic channel alliance
96) CPW (Cereals Partners Worldwide) is a ________ designed from the start to be a global
business. It joined the cereal manufacturing and marketing capability of General Mills with the
distribution clout of Nestlé.
A) dual distribution partnership
B) multichannel distribution system
C) cooperative distribution channel
D) strategic channel alliance
E) bilateral trade cooperative
97) Professionally managed and centrally coordinated marketing channels designed to achieve
channel economies and maximum marketing impact are referred to as
A) integrated marketing systems.
B) horizontal marketing systems.
C) vertical marketing systems.
D) functional marketing systems.
E) cooperative marketing systems.
98) Vertical marketing systems are
A) professionally managed geographically dispersed marketing channels designed to achieve
channel economies and maximize marketing impact.
B) professionally managed and centrally coordinated marketing channels designed to achieve
channel economies and maximum marketing impact.
C) retailer-sponsored cooperatives where small, independent retailers form an organization that
operates a wholesale facility cooperatively.
D) professionally managed geographically dispersed marketing channels that are controlled
through strategic channel alliances.
E) channel partnerships that share responsibility for ordering and physically distributing each
other’s products.
99) The three major types of vertical marketing systems are contractual, corporate, and
A) integrated.
B) cooperative.
C) delegated.
D) manufacturer-dominated.
E) administered.
100) Corporate vertical marketing systems are
A) small, independent retailers that form an organization that operates a wholesale facility
cooperatively.
B) professionally managed geographically dispersed marketing channels that are controlled
through strategic channel alliances.
C) the combination of successive stages of production and distribution under a single ownership.
D) professionally managed and centrally coordinated marketing channels designed to achieve
channel economies and maximum marketing impact.
E) a contractual arrangement between a parent company and an individual or firm that allows the
individual or firm to operate a certain type of business under an established name and according
to specific rules.
101) The combination of successive stages of production and distribution under a single
ownership is referred to as
A) a contractual vertical marketing system.
B) a corporate vertical marketing system.
C) an integrated marketing system.
D) a corporate horizontal marketing system.
E) a contractual horizontal marketing system.
102) Which of the following statements regarding corporate vertical marketing systems is most
accurate?
A) Corporate vertical marketing systems can use either forward integration or backward
integration but not both.
B) Corporate vertical marketing systems increase distribution costs.
C) Corporate vertical marketing systems increase investment but decrease fixed costs.
D) Corporate vertical marketing systems are only effective with low-end consumer products.
E) Corporate vertical marketing systems offer more control over supply sources or resale of
products.
103) Which of the following statements regarding corporate vertical marketing systems is most
accurate?
A) Corporate vertical marketing systems combine successive stages of production and
distribution under shared ownership with all links in the marketing chain sharing title to the
goods.
B) Corporate vertical marketing systems can incorporate both forward and backward integration.
C) Corporate vertical marketing systems increase distribution costs.
D) Corporate vertical marketing systems increase investment increases but decrease fixed costs.
E) Corporate vertical marketing systems are only effective with low-end consumer products.
104) A large company produces paint and other home decorating products. Its goal is to choose
the marketing channel arrangement that will give it the most control over supply sources. Which
marketing channel system should this company choose?
A) a contractual vertical marketing system
B) an administered vertical marketing system
C) a corporate vertical marketing system
D) an integrated marketing system
E) a corporate horizontal marketing system
105) Cessna is considered the volume leader in the executive jet market. It has been described as
“almost totally vertically integrated.” This quote means that Cessna
A) does not fall under the jurisdiction of any federal regulatory agency.
B) owns several of the entities that would make up the traditional marketing channel.
C) has eliminated economies of scale.
D) has achieved a high level of social responsibility.
E) uses outsourcing for all component parts and materials.
106) 21st Century Fox is the name for Fox’s broadcast/cable TV networks and TV/movie studios.
Since most of the shows produced at its TV production unit and many of the movies made at its
studio are only televised on its cable TV networks, 21st Century Fox is an example of
A) a corporate vertical marketing system.
B) an integrated marketing system.
C) a contractual vertical marketing system.
D) a corporate horizontal marketing system.
E) a contractual horizontal marketing system.
107) When a producer owns an intermediary at the next level down in the marketing channel, it
is referred to as
A) horizontal integration.
B) forward integration.
C) parallel integration.
D) lateral integration.
E) backward integration.
108) Forward integration refers to
A) a retailer that owns a manufacturing operation.
B) a wholesaler that owns a manufacturing operation.
C) retailers that form a strategic channel alliance with manufacturers to purchase products at
better prices since they are able to place much larger orders.
D) a producer that owns an intermediary at the next level down in the marketing channel.
E) channels in which all members own stock in the manufacturer’s company.
109) Apple now operates over 400 Apple retail stores around the world to sell its innovative
products such as the iPhone and Apple Watch. Apple uses
A) dual distribution.
B) backward integration.
C) forward integration.
D) horizontal integration.
E) strategic channel alliances.
110) When a retailer owns a manufacturing operation, it is referred to as
A) forward integration.
B) lateral integration.
C) a joint venture.
D) horizontal integration.
E) backward integration.
111) Tiffany & Co. manufactures about half of the fine jewelry items for sale in its stores and
boutiques worldwide. Tiffany & Co. practices
A) backward integration.
B) forward integration.
C) vertical integration.
D) joint venturing.
E) horizontal integration.
112) A contractual vertical marketing system is an arrangement whereby
A) privately owned distributors and retailers integrate their efforts, on a contractual basis, to
obtain greater functional economies and marketing impact than they could achieve alone.
B) independent production and distribution firms integrate their efforts, on a contractual basis, to
obtain greater functional economies and marketing impact than they could achieve alone.
C) a manufacturer offers a limited number of franchise licenses to restrict the number of
franchisees within a given geographical region.
D) a firm reaches different buyers by employing two or more different types of channels for the
same basic product.
E) a firm formally designates by contract one channel member—whether producer, wholesaler,
or retailer—to coordinate, direct, and support all other channel members.
113) There are three variations of contractual systems: wholesaler-sponsored voluntary chains,
retailer-sponsored cooperatives, and
A) franchising.
B) service-oriented voluntary chains.
C) channel-dominated voluntary chains.
D) distributorship cooperatives.
E) direct marketing.
114) A vertical marketing system that involves a contractual relationship between a wholesaler
and small independent retailers to standardize and coordinate buying practices, merchandising
programs, and inventory management efforts is referred to as
A) a service-sponsored retail franchise system.
B) a retailer-sponsored cooperative.
C) an administered vertical marketing system.
D) a manufacturer-sponsored retail franchise system.
E) a wholesaler-sponsored voluntary chain.
115) IGA and Ben Franklin variety and craft stores are examples of
A) service-sponsored retail systems.
B) wholesaler-sponsored voluntary chains.
C) retailer-sponsored cooperatives.
D) administered cooperative systems.
E) manufacturer-sponsored cooperatives.
116) Which type of contractual vertical marketing system involves small independent retailers
forming an organization that operates a wholesale facility cooperatively?
A) retailer-sponsored cooperative
B) service-sponsored retail system
C) administered cooperative system
D) manufacturer-sponsored cooperative
E) wholesaler-sponsored voluntary chain
117) A retailer-sponsored cooperative refers to
A) small, independent retailers forming an organization that operates a wholesale facility
cooperatively.
B) a vertical marketing system that involves a contractual relationship between a wholesaler and
small independent retailers to standardize and coordinate buying practices, merchandising
programs, and inventory management.
C) an agreement among small, privately owned manufacturers to pool their resources by sharing
installations, heavy equipment, and warehousing they would be unable to afford on their own.
D) an agreement among retailers to pool their resources by purchasing services such as signage,
snow removal, and trash removal that affects the physical space (strip mall, etc.) they all share.
E) small, independent retailers that pool their resources to finance store expansion programs.
118) Ace Hardware is a national ________ that allows its members, retailers of paint and
hardware products, to concentrate their buying power through wholesalers and plan collaborative
promotional and pricing activities.
A) service-sponsored retail system
B) administered cooperative system
C) retailer-sponsored cooperative
D) manufacturer-sponsored cooperative
E) wholesaler-sponsored voluntary chain