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The "battle of the brands" hurts consumers by driving up prices.
Sales reps often must plan whole marketing strategies for their own geographic
territories.
Unless the problem is precisely defined, research effort may be wasted on the wrong
problem, and may lead to costly mistakes.
It is useful to think of the marketing strategy planning process as a process that begins
with a narrow focus but then broadens to embrace unlimited opportunities and options.
The idea behind a pulling policy is that customer demand helps to pull the product
through the channel.
When a variety of information sources are readily available in new-task buying, a buyer
is much less likely to use a trusted source.
Areas with small populations may still be attractive target markets for some
firmsbecause there may be less competition.
Promotion is composed of personal selling, advertising, publicity, and sales promotion.
Both the birthrate and the buying power of ethnic groups in the U.S. are increasing.
Sales promotion refers to those promotion activities--other than advertising, publicity,
and personal selling--that stimulate interest, trial, or purchase by final customers or
others in the channel.
Less than 6 percent of all retail sales are made by smaller storesthose with sales of less
than $1 million a year.
Capital comes from external sources and working capital comes from internal sources.
Average-cost pricing works well if the firm actually sells the quantity which was used
in setting the price, but losses may result if actual sales are much higher than were
expecteddue to higher total variable costs.
Positioning issues are especially important when competitors in a market appear to be
very similar.
Because packaged products are regularly seen in retail stores, a good package may give
a firm more promotion effect than it could possibly afford with advertising.
Business product classes are based on the way that buyers shop for and buy products,
because there is much more shopping for business products compared to consumer
products.
Place decisions are easier to change in the short-run than Product, Price, and Promotion
decisions.
Fashion-related products tend to have short life cycles.
In the United States, the West and the South are growing faster than the Northeast and
the North Central areas.
Even though marketing managers might like more information, they must balance the
high cost of good research against its probable value to management.
Asian Americans are the largest and fastest-growing ethnic group in the United States.
It is usually more difficult to provide consistent quality for goods as opposed to
services.
Mass-merchandisers emphasize "hard goods" while discount houses emphasize 'soft
goods."
Customer value is the difference between the benefits a customer sees from a market
offering and the costs of obtaining those benefits.
Competitive rivals are always easy to identify.
During the market introduction stage of the product life cycle, the basic promotion
objective is informing.
One way to increase customer equity is to find cost-effective ways to serve current
customers so they buy more.
Developing goodwill and stimulating demand are tasks performed by missionary
salespeople.
In the market growth stage of the product life cycle, firms usually earn smaller profits
than they did in the market introduction stage because new competitors enter the
market.
The profit potentials of alternative strategic plans can be evaluated at the same time
only if the plans are very similar.
E-commerce refers to exchanges between individuals, but not exchanges between
organizations.
When the cost of borrowing is high, firms should wait before implementing a marketing
plan.
Heavy, bulky goods requiring long distance movement are usually carried by railroads.
The text credits Chipotle's success to its offering good customer value.
When evaluating possible strategies, a marketing manager shouldn't have to worry
about screening based on financial criteria because the finance area's main job is to get
the capital needed to implement the firm's marketing plan.
Marketing means "promotion and selling."
Aggressive, market-oriented intermediaries are almost always available and eager to
handle the distribution of innovative, new products.
_____ is a manager who helps directs the activities of a whole channel and tries to
avoid or solve channel conflicts.
A. A channel executive
B. A channel captain
C. A distribution manager
D. Channel coordinator
E. Distribution leader
An automobile plant is capable of manufacturing 40 sport utility vehicles in 24 hours.
This details the manufacturing plant's _____.
A. task transfers
B. production capacity
C. mass customization strategy
D. working capital
E. natural accounts
Which of the following expenses involves the working capital a company needs for
operation?
A. The money required to purchase land in order to set up a plant
B. The money required to purchase equipment necessary to begin operations
C. The money required to pay the salary of employees
D. The money required to acquire a competing firm
E. The money required to set up the power grid for a new manufacturing plant
Wilson Alvaro graduated with a marketing degree almost a year ago. Like many of his
friends, he took a job in sales and really enjoys it. A description of Wilson's job and
those of some of his friends are noted below.
Wilson Alvaro loves biking and has his dream job. He works for a wholesale company
that sells mountain bikes for a manufacturer. He works with a small group of people
who call on the buying offices for two large retail chains, Wal-Mart and Toys R Us. The
group includes a finance person and a production person, and they all work together to
meet the specific needs of these two big accounts; for example, sometimes they
recommend a model of bike that will be available from only that retailer's stores.
However, Wilson's main job focuses on building relationships and solving customer
problems. Only occasionally is he expected to try to persuade the retailers to buy more
bikes.
Amy Bowden sells life insurance. She calls on new parents and persuades them to buy
insurance products. It is difficult for a manager to control Amy's work, but she has
incentive to work hard because her job security and income depend on getting sales.
She is a confident self-starter, so she likes it that way.
Ben Peterson works for a fashionable men's clothing store. He enjoys spending time
with customers who come in, learning about their fashion needs, and helping them pick
clothes that really work for them. While the store manager can easily observe and direct
Ben's activities, the manager wants Ben to have the incentive to increase customer
purchases and satisfaction.
Emily Winters handles inside sales for a major industrial distributor. She deals with a
regular set of established customers, most of whom know what they want. Emily talks
to them on the phone and answers questions about products, delivery time, and pricing.
She sometimes works with outside sales reps who visit customers and help introduce
new products. Emily is the first person her customers call when there's a problem with a
purchase, so she spends a lot of time dealing with customer problems. As an inside
salesperson, Emily's work is easily supervised by a sales manager-and she has little
influence on how much her customers buy.
Melissa Tran works for a company that sells paper products (like napkins, paper towels,
and paper plates) primarily through small independent grocers. Most of the grocers are
regular customers, but sometimes she makes cold calls to new grocery stores. Melissa's
job is to develop goodwill and try to increase sales. For example, she often sets up
special promotional displays in stores. Her compensation plan gives her income
security, but she also can receive a bonus for sales growth in her territory.
Charlie Riggs is a telemarketer for an Internet service provider. He calls people on a list
provided by his firm and tries to sign them up for Internet service. Charlie relies heavily
on a presentation he learned during his training. Charlie is very good at what he does
and loves that the more success he has the more he earns.
Which salesperson does the most customer service?
A. Charlie Riggs
B. Melissa Tran
C. Emily Winters
D. Ben Peterson
E. Amy Bowden
Regarding bid pricing:
A. the same overhead charges and profit rates should apply to all bidsto avoid legal
problems.
B. most firms should try to bid for as many jobs as possibleto spread risk.
C. all business buyers are legally required to accept the lowest bidif they ask for bids.
D. the big problem for sellers is estimating all the costsincluding the variable and fixed
coststhat apply to a particular job.
E. All of these alternatives are correct.
Air express companies place many small packages into specially designed cylinders
that conform to the interior dimensions of a cargo airplane. This practice protects the
smaller packages and helps to reduce distribution costs. The air express companies are
practicing:
A. Containerization.
B. Piggybacking.
C. Freight forwarding.
D. Cylinderization.
E. None of these choices is correct.
Advertising agencies:
A. usually require advertisers to sign long-term contracts.
B. prefer to work with local advertisers rather than national advertisers.
C. compete against the national media for the business of big advertisers.
D. do little more than sell media time or space to advertisers.
E. are specialists in planning and handling mass selling details.
In the marketing mix, the customer is:
A. one of the four components of the marketing mix.
B. the entity that selects the marketing mix.
C. the target market for the marketing mix.
D. the "place" in the four Ps of the marketing mix.
E. the "person" in the four Ps of the marketing mix.
Ravi Singh is working his way through college as an independent distributor of the
Rapier Knife Co. The Rapier product line includes kitchen knives, hunting knives, and
other special-purpose cutlery. Ravi makes sales presentations to potential customers in
their homes. If a customer wants to make a purchase, Ravi buys the knives from Rapier
and sells them to the customer at a markup. For example, Rapier's most popular knife is
a chef's knife that Ravi buys for $25 and resells to the consumer for $50. Ravi:
A. Is part of a direct-to-customer channel.
B. Is engaged in direct marketing.
C. Is engaged in direct selling, but is part of an indirect channel.
D. None of these alternatives is correct.
Dealer brands make up almost ______ percent of the products in U.S. grocery stores.
A. 10
B. 20
C. 30
D. 40
E. 50
The main reason that vertical marketing systems are becoming more common is:
A. firms realize that working independently has advantages for channel members.
B. firms increasingly understand that competition among channel members is
profitable.
C. it's easy for multiple firms to coordinate a single marketing mix for a common target
market.
D. firms recognize that coordination among channel members can increase sales for
each channel member.
E. only vertical marketing systems perform activities that adjust the quantities or
assortments of products handled at each level in a channel of distribution.
Sales analysis:
A. requires more information than is available from traditional accounting reports.
B. can be done in different waysthere is no single "best way."
C. often studies how sales patterns change over time.
D. All of these are true.
Fresh Farm Produce Co. has examined transportation costs and found that shipping its
fruits and vegetables by rail to distant markets would cost them only $89,000, while
airfreight would cost $250,000. Because the costs of the actual fruits and vegetables are
the same for each transportation mode, Fresh Farm Produce should
A. try to determine other physical distribution costs before deciding on whether to use
airfreight.
B. immediately switch to rail to save money.
C. conduct marketing research to determine which fruits and vegetables customers want
most.
D. immediately switch to airfreight because it is clearly a faster mode of transportation.
E. ship with airfreight and store the fruits and vegetables in warehouses.
Why can't marketing managers be satisfied just planning present activities?
A. Markets are dynamic.
B. Consumers' needs keep changing.
C. The environment keeps changing.
D. Competitors often change.
E. All of these are reasons why marketing managers can't be satisfied just planning
present activities.
Which of the following statements explains why marketers use focus groups to conduct
research?
A. People may not feel free to express their honest thoughts in groups.
B. Some individuals may dominate group discussion.
C. 6 to 10 people provide feedback to marketing questions in a single event.
D. The results cannot be measured objectively.
E. Conclusions reached from a session usually vary depending on the viewpoint of the
researcher.
Which of the following is NOT a current trend affecting marketing strategy planning?
A. growth of interactive agencies.
B. shrinking media budgets.
C. growth of MIS and DSS systems.
D. declining use of interactive bidding and proposal requests.
E. aging of the baby boomers.
Gabriella Sax believes that customers in her dress shop find certain prices very
appealing. Between these price levels, all prices are seen as roughly the sameand price
cuts in these ranges generally do not increase the quantity sold (i.e., the demand curve
tends to drop vertically within these price ranges). Therefore, Sax prices her items as
close as possible to the top of each such price range. This is:
A. bait pricing.
B. prestige pricing.
C. leader pricing.
D. psychological pricing.
E. odd-even pricing.
Department stores:
A. are basically a group of limited-line stores under one roof.
B. are decreasing in number, average sales per store, and share of retail business.
C. usually aim at customers seeking shopping products.
D. are usually strong in customer service.
E. All of these alternatives are true for department stores.
Which of the following statements about S.W.O.T. analysis is true?
A. It is a useful aid for identifying relevant screening criteria and for zeroing in on a
feasible strategy.
B. S.W.O.T. is simply an abbreviation for the first letters of the words: strengths,
weaknesses, opportunities, and threats.
C. It identifies and lists the firm's strengths and weaknesses and its opportunities and
threats.
D. It helps managers focus on a strategy that takes advantage of the firm's strengths and
opportunities while avoiding its weaknesses and threats to its success.
E. All of these statements about S.W.O.T. analysis are true.
The standardization and grading function of marketing involves:
A. promoting goods and services.
B. collection, analysis, and distribution of marketing information.
C. sorting products according to size and quality.
D. looking for and evaluating goods and services.
E. movement of goods from one place to another.
Which of the following statements best explains the "iceberg principle"?
A. Several salespeople in a sales force usually meet their quotas while many others
don't.
B. Many salespeople don't make their quotas because they only try to sell to large
customers.
C. Most consumer decisions are at the 90 percent pre-conscious level.
D. Ten percent of a firm's customers usually account for 90 percent of its sales.
E. Good performance in some areas may hide poor performance in other areas if only
averages are evaluated.
Zippo is pursuing _____ opportunities with its Multi-Purpose Lighter that is designed to
light candles, fireplaces, grills, and more.
A. market penetration
B. market development
C. product development
D. diversification
E. channeling
The fact that our eyes and minds seek out and notice only information that interests us
is called:
A. conscious cognition.
B. selective exposure.
C. selective retention.
D. preconscious perception.
E. selective perception.
_____ refers to the way an economy organizes to use scarce resources to produce goods
and services and distribute them for consumption by various people and groups in
society.
A. Resource utilization
B. Socio-economic policy
C. The way a firm measures value
D. Separation of values
E. Economic system
Which of the following statements is(are) TRUE regarding government's role in
regulating advertising?
A. Canada bans any advertising targeted directly at children.
B. Japan limits the use of cartoon characters in ads to children.
C. Switzerland does not allow an actor to represent a consumer in an ad.
D. New Zealand limits political ads on TV.
E. All of these statements are TRUE.
Which of the following statements about marketing's impact on the economy is False?
A. Companies force consumers to buy products at exorbitant prices.
B. When new products are introduced, the prices of old products often drop.
C. Rising profits lead to increased investments and further economic growth.
D. Increased profits attract competition.
E. Profits begin to drop as new competitors enter a market with similar products.
_________ concerns the extent to which data measures what it is intended to measure.
A. Conformance
B. Reliability
C. Depth
D. Validity
E. Penetration
Since music, movies, books, and TV programs now exist in digital form, such products:
A. have the same distribution methods as physical products.
B. have lower distribution costs.
C. do not require "intermediaries."
D. do not need distribution.
E. do not face discrepancies of quantity or assortment.
Which of the following statements is NOT TRUE?
A. Good implementation builds relationships with customers.
B. Implementation ignores external matters.
C. Implementation is especially critical in mature and highly competitive markets.
D. Effective implementation means that plans work as intended.
E. Implementation has its own objectives.
Identify the true statement pertaining to publicity.
A. It is any paid form of nonpersonal presentation of ideas, goods, or services by a
sponsor.
B. It is the main form of mass selling which includes only the use of traditional media.
C. If a firm has a really new message, publicity may be less useful than advertising.
D. Posting videos on YouTube and writing blogs are both ways a company can use
publicity to its advantage.
E. It tries to attract attention to the firm and its offerings by paying substantial media
costs.
Gradual "rollouts" are characteristic of which step of the new-product development
process?
A. Idea generation
B. Development
C. Idea screening
D. Idea evaluation
E. Commercialization
The observing method in marketing research:
A. uses personal interviews.
B. may require customers to change their normal shopping behavior.
C. is used to gather data without consumers being influenced by the process.
D. is not suitable for obtaining primary data.
E. None of these alternatives is correct.
_____ means setting a fair price level for a marketing mix that really gives the target
market superior customer value.
A. Uniform pricing
B. Target pricing
C. Consumer surplus
D. Value pricing
E. Status quo pricing
