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The sequence of markups firms use at different levels in a channel is referred to as a
A. market sequence.
B. markup chain.
C. markup margin.
D. standard markup.
E. markup channel.
Terry Harter is marketing manager for United Tools and Mike O'Reilly is the firm's
logistics manager. They work together to make decisions about how to get United's
hand and power tools to its customersa mix of manufacturing plants and final
consumers (who buy United tools at a hardware store). United Tools does not own its
own transport facilities and it works with wholesalers to reach its business customers.
Together, Harter and O'Reilly try to coordinate transporting, storing, and product
handling activities to minimize cost while still achieving the customer service level
their customers and intermediaries want. This usually requires that United keep an
inventory of most of its products on hand, but demand for its products is fairly
consistent over time so inventory is easy to manage.
Harter has identified four options for physical distribution systems she could use to
reach two of her key wholesalers, Ralston Supply and Ricotta Tool Co. The total cost
for each optionand the distribution service levels that can be achievedare as follows:
Ralston Supply expects a very high level (90 percent) of distribution customer service.
Ricotta Tool Co. is willing to settle for a 70 percent customer service level, even if that
means some products will occasionally be out of stock, if it gets products at a lower
price.
For its large retail hardware customers (like Home Depot), United regularly ships
smaller orders directly to individual stores or in some cases to the retail chain's
warehouses. Cross-country shipments usually go by rail while regional shipments
usually go by truck.
To help in managing excess inventory, United Tools would most likely use:
A. a private warehouse.
B. a public warehouse.
C. piggyback mode.
D. a distribution center.
E. All of these would help in managing excess inventory.
A virtual corporation:
A. does all of its production "in house".
B. looks for capable suppliers who can meet the specs it lays out.
C. acts primarily as a producer.
D. needs to have a good marketing plan.
E. looks for capable suppliers who can meet the specs it lays out and needs to have a
good marketing plan only.
Which of the following is NOT a psychological variable?
A. Attitudes
B. Social class
C. Motivation
D. Learning
E. Perception
Charissa works at a computer software company where it is her responsibility to
determine the blend of promotion methods in a strategy decision. Which of the
following would most likely be her job title?
A. Marketing manager
B. Sales promotion manager
C. Advertising manager
D. Public relations manager
E. Sales manager
As a project for her marketing class, Emily Washington is researching how five local
businesses price their products. The following are brief sketches of what she has learned
about each company.
At Bella Computers, Emily has discovered that the company earned a 6 percent return
on investment this year and wants to increase it to 9 percent next year. To its retailer
customers, Bella Computers gives cash discount terms of 2/10, net 30. It also gives
retailers a 3% reduction on the invoice amount for advertising Bella products locally.
Bella gives retailers' salespeople 2% of the sale price for each Bella Computer they sell.
At Ross Pharmaceuticals, she learned that the company has invested heavily in
developing a new product that recently received a patent. Because cash is tight, the
company wants to achieve a rapid return on its investment. The new patented product is
badly needed in the market, so a very inelastic demand curve is expected.
Digital Imaging makes photographic prints for wedding photographers. It is very
concerned about competitor reactions to its pricing, so it has selected prices that will not
draw the attention of the competition and not start a price war. Digital Imaging offers
customers an 8% discount if their purchases exceed $20,000 a year.
Jack's One Hour Cleaners recently opened for business. The company invested a lot of
money in new equipment, and feels that it has to quickly get "at least 10% market share
to stay in the game." This need obviously influences the company's pricing decisions.
Jack's also plans to offer customers 20% discounts on any order over $20.
National Printing Equipment (NPE) produces equipment that helps to print newspapers
and magazines. The company sells directly to printers and through wholesalers. Its
salespeople negotiate prices with individual customers and often have to match
competitors' prices. NPE has a new product, the Gutenberg NP201, with some
competitive advantages now, but competitors are expected to follow quickly with
similar products. The new product is being introduced into a market with elastic
demand. In regard to freight charges for its equipment, NPE's invoice reads, "Seller
pays the cost of loading equipment onto a common carrier. At the point of loading, title
to such products passes to the buyer, who assumes responsibility for damage in transit,
except as covered by the transportation agency."
Bella Computers' pricing objective is best described as:
A. target return.
B. status quo oriented.
C. profit oriented.
D. sales oriented.
E. None of these is a good answer.
Consumer buying behavior is affected by:
A. opinion leaders.
B. social class.
C. physiological, safety, social, and personal needs.
D. reference groups.
E. All of these affect consumer buying behavior.
With the ___________ approach, the sales rep begins by making some general benefit
statements to get the customer's attention and interest.
A. Prepared sales
B. Fixed sales
C. Selling formula
D. Consultative selling
E. Differentiated value
A retailer's target market consists of people who usually will not consider a new idea
until others have tried itand liked it. These potential customers have a lot of contact
with mass media and salespeople, but usually are not opinion leaders. These target
customers are:
A. early adopters.
B. laggards.
C. innovators.
D. the early majority.
E. the late majority.
Producers can positively manage channel conflict using all the following tactics except:
A. offer different products through different channels.
B. serve different market segments through different channels.
C. limit channel member relationships to buying and selling activity.
D. compensate participating channel members when conflict exists.
E. identify a channel captain.
______________ means potential customers won't buy a brandunless its current image
is changed.
A. Brand preference
B. Brand rejection
C. Brand insistence
D. Brand recognition
E. Brand nonrecognition
Whether a macro-marketing system is fair or effective depends on
A. goods and services being evenly distributed across the population.
B. discrepancies of quantity.
C. the emphasis given to military spending.
D. the marketing orientation of individual firms.
E. the objectives of the society.
World Tennis Ball Co. (WTB) makes tennis balls and sells them only in the U.S. Raul
Fernandez, the firm's marketing manager, is comparing his firm's distribution with two
major competitors.
1) WTB sells its products through four regional distributors who then sell to 22 sporting
goods wholesalers. The wholesalers sell to a total of 7,000 retail outlets. From its
website, WTB also sells directly to any customer who will purchase a minimum
quantity of 24 tennis balls. WTB cooperates with members of its channel, but maintains
some control through its economic power and leadership. It helps to direct the activities
of the whole channel and tries to avoid or resolve channel conflicts.
2) American Tennis Ball (ATB) is a competitor that sells through two distributorseach
with half the country. The distributors then sell through 6 sporting goods wholesalers,
and they, in turn, sell to 1,000 retail outlets (split between two national sporting goods
chains and two general merchandise stores). ATB and its channel make little effort to
work together. However, because of a relatively low level of competition between the
distributors, the wholesalers, or the retail stores, each member of the channel gives the
product special attention.
3) National Tennis Ball (NTB) sells its products through only three tennis specialty
wholesalers that sell only to tennis clubs. NTB actually owns the wholesale firms that
handle its products. NTB's balls are only available at certain tennis clubs and NTB
limits coverage to only one club in a particular geographic area.
Which of these companies uses a corporate channel of distribution?
A. World Tennis Ball.
B. American Tennis Ball.
C. National Tennis Ball.
D. Both World Tennis Ball and National Tennis Ball use a corporate channel.
E. There is not enough information to tell which company uses a corporate channel of
distribution.
Integrated direct-response promotion:
A. got its start when the introduction of TV made it possible for firms to use broadcast
advertising to reach mass markets.
B. is an alternative to integrated marketing communications, which are used when
direct-response is not required.
C. takes many forms, but it always involves the use of mail advertising.
D. is usually part of a pushing effort rather than part of a pulling approach.
E. None of these alternatives is true for integrated direct-response promotion.
_________ are countries that limit the use of cartoon characters in advertising to
children.
A. USA and New Zealand
B. Japan and USA
C. France and Japan
D. New Zealand and France
E. Switzerland and USA
The direct market environment
A. includes customers, the company, and competitors.
B. consists of variables that can be controlled.
C. is broader in scope than the external environment.
D. includes economic and technological environments.
E. is made up of the political, legal, and social environments.
In the United States, the federal regulatory agency that has the power to control
deceptive advertising and require corrective advertising is the:
A. Securities and Exchange Commission.
B. Federal Trade Commission.
C. Office of Consumer Affairs.
D. Fair Trade Committee.
E. Consumer Product Safety Commission.
Regarding supplies,
A. new-task buying is typical with most purchases.
B. only one supplier is generally available.
C. branding is not important for maintenance and small operating supplies.
D. breadth of assortment is important, but dependability is not.
E. None of these alternatives is correct.
Which of the following is NOT true about retailing in different nations?
A. New retailing ideas rarely spread to other countries.
B. Mass-merchandising requires mass markets.
C. Retailers in slow growth developing countries have looked abroad for growth.
D. Cultural differences influence preferences for online shopping.
E. Less-developed countries often don't have the income to support mass distribution
retailers.
To reduce conflicts in channels, a firm should:
A. Offer different products through each channel.
B. Provide some compensation to members of the older channel.
C. Treat channel partners fairly even when one partner is more powerful.
D. Focus on segments not currently served by existing channels.
E. All of these alternatives are correct.
Break-even charts usually assume that:
A. total cost and total revenue curves are straight lines.
B. profits will grow continually beyond the break-even point.
C. the break-even point is reached when total cost just equals total revenue.
D. any quantity can be sold at the assumed price.
E. All of these are assumptions of break-even charts.
A retailer's target customers are skeptical and cautious about new ideas. Strong social
pressure from their own peer group may be needed before they adopt a new product.
These target customers are:
A. the early majority.
B. laggards.
C. innovators.
D. early adopters.
E. the late majority.
The Garland Advertising Agency provides promotional assistance to small and
medium-sized firms that cannot afford to pay the fees charged by large national
advertising agencies. Garland would fall into which of the following business product
classes?
A. Components.
B. Installations.
C. Professional services.
D. Raw materials.
E. Supplies.
When a company hires a consulting firm to do a complete annual review and analysis of
its marketing plans and financial performance, this process is a:
A. Marketing audit.
B. Performance analysis.
C. Performance index.
D. Full-cost approach.
E. Contribution-margin approach.
A new product idea is more likely to move quickly through the early stages of the
product life cycle when:
A. the product is easy to use.
B. the product is compatible with the values and experiences of target customers.
C. the product can be given a trial.
D. the product's advantages are easy to communicate.
E. All of these alternatives are correct.
"Good" market segments are those which are:
A. heterogeneous between.
B. operational.
C. substantial.
D. homogeneous within.
E. All of these choices are correct.
American Tourister, Inc.a producer of luggageis planning to introduce a new product
line. The marketing manager is having her sales force call on retailers to explain
American Tourister's consumer advertising plans, the unique features of the new
luggage, how the distributors can best promote it, and what sales volume and profit
margins they can reasonably expect. This is an example of:
A. a "pulling" policy.
B. intensive distribution.
C. selective distribution.
D. a "pushing" policy.
E. exclusive distribution.
With the ___________ approach, the salesperson assumes that a customer faced with a
particular stimulus will say yes to his request for an order.
A. Selling formula
B. Consultative selling
C. Prepared sales
D. Fixed sales
E. Differentiated value
When Greenpeace sends a mail request for a financial contribution to someone who has
donated to its causes in the past, this is an example of:
A. direct marketing.
B. integration.
C. publicity.
D. indirect-response promotion.
E. mass selling.
In 2009, 100 percent of this country's population was in urban areas.
A. United States
B. Singapore
C. United Kingdom
D. Germany
E. Italy
Marketing should
A. begin with the production process.
B. make decisions about product design and packaging, prices or fees.
C. not need to coordinate with production, accounting, and financial activities.
D. provide input, but let production determine what goods and services are to be
developed.
E. focus on getting customers to make a final purchase.
