Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
Direct-response promotion usually relies on a(n) _____ database to target specific
prospects.
A. customer relationship management
B. sales force management
C. entity-attribute-value model
D. enterprise relationship management
E. multidimensional preference
Answer:
A young working couple earned $35,000 last year, and paid $10,000 in taxes. They
spent $13,000 on rent, food, insurance, and other "necessities." What is their
discretionary income?
A. $12,000
B. $35,000
C. $22,000
D. $25,000
Answer:
Sears uses a(n) _______________ brand when it uses the same brand name for several
products. In contrast, General Motors, by using different brands for each car line, uses
______________ brands.
A. individual, generic
B. generic, family
C. manufacturer, dealer
D. national, local
E. family, individual
Answer:
A live-at-home college student is watching a "Mad Men" TV program, but walks to the
refrigerator to get a soft drink during a commercial. In the traditional communication
model, the walk to the refrigerator is the:
A. Source
B. Receiver
C. Noise
D. Decoding
E. Encoding
Answer:
Sales of a producer's wax paper food-wrap are declining fast. The advertising
manager-looking for a way to attract attention to the brand-suggests changing the
package somewhat and promoting it as a "new" product. The Federal Trade
Commission
A. would allow the company to call the product "new" for only six months.
B. probably would not approve of this at all.
C. would allow the advertising campaign if it concluded that consumers thought the
different package made it new.
D. does not regulate advertising, so it would not pay any attention to this firm.
E. None of these alternatives is correct.
Answer:
A basic difference between a "generic market" and a "product-market" is:
A. whether or not sellers in the market rely on e-commerce.
B. how similar the competing sellers' products are.
C. whether customer needs are similar or different.
D. whether the market includes only buyers-or both buyers and sellers.
E. There is NO DIFFERENCE-the terms mean the same thing.
Answer:
Raymond Weil, a European manufacturer of premium watches, is trying to compete in
the U.S. market with other fine watch brands. Its corporate website contains the
following notice: "RAYMOND WEIL products are sold by official dealers only. The
RAYMOND WEIL International Guarantee is offered exclusively to consumers in
possession of a watch purchased from an official dealer." In the United States,
Raymond Weil watches are not available in every jewelry or department store. For
example, in large cities such as Boston, Washington, D.C., and San Francisco, there are
only three retailers in each city that are official Raymond Weil dealers. Raymond Weil
seems to be using:
A. intensive distribution.
B. selective distribution.
C. exclusive distribution.
D. extensive distribution.
E. limited distribution.
Answer:
_____ distribution is commonly used for convenience products and business supplies.
A. Internal
B. Intensive
C. Selective
D. Specialized
E. Exclusive
Answer:
Advertising allowances offered by producers can be ILLEGAL unless they are made
available:
A. for products of "like grade and quality."
B. to all customers on proportionately equal terms.
C. to all buyers in equal dollar amounts.
D. on all products sold by the producer.
E. within an FTC approved agreement.
Answer:
Which of the following is a demographic pattern that affects marketing strategy
planning?
A. Shrinking media budgets
B. Growth of interactive agencies
C. Slower real income growth in the United States
D. Major accounts specialization
E. Interactive bidding and proposal requests
Answer:
Trying to balance the interests of people who want to drink beer and the dangers of
drunk driving is an example of:
A. the role of a central market.
B. subsistence marketing.
C. political action.
D. the macro-micro dilemma.
E. the exchange process in marketing.
Answer:
Marketing:
A. emphasizes mass selling over personal selling.
B. allows production, rather than marketing, to determine what products to make.
C. applies to both profit and nonprofit organizations.
D. concentrates on production, rather than advertising.
E. none of these is a true statement about marketing.
Answer:
Use this information for question that refer to the United Tools case.
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 customers-a 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 option-and the distribution service levels that can be achieved-are 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.
In designing the right physical distribution system, United Tools should primarily focus
on:
A. the inventory level that its current warehouse can support.
B. the lowest cost transportation method for each of its products.
C. where customers store their inventory.
D. the desired customer service level.
E. the physical characteristics of each product.
Answer:
In the U.S., about ________ people work directly in the advertising industry.
A. 410,000
B. 460,000
C. 510,000
D. 560,000
E. 610,000
Answer:
A firm which makes special batteries that boat and motorcycle manufacturers buy and
install directly in their new boats and cycles is selling:
A. supplies.
B. component parts.
C. component materials.
D. installations.
E. accessory equipment.
Answer:
All of the following products are in the market maturity stage of the product life cycle
except:
A. laundry detergents.
B. breakfast cereals.
C. streaming video movies.
D. carbonated soft drinks.
E. gasoline-powered cars.
Answer:
New-product specialists at Whirlpool buy washing machines made by other firms and
take them apart to look for new ideas. This is called
A. reverse engineering.
B. positioning.
C. S.W.O.T. analysis.
D. concept testing.
E. clustering.
Answer:
The advertising medium of ___________ reaches local customers who are ready to buy,
but differentiation is hard because many other competitors are listed in the same place.
A. Radio
B. Yellow Pages and other directories
C. Television and cable
D. Magazine
E. Internet
Answer:
Break-even analysis usually:
A. makes it appear that any quantity can be sold at the assumed price.
B. suggests that profits will decrease rapidly as sales volume increases beyond the
break-even point.
C. is quite accurate in maximizing profit.
D. assumes a U-shaped average variable cost curve.
E. None of these alternatives is correct.
Answer:
When McDonald's corporate headquarters offers a local McDonald's franchise to a
franchisee on Bourbon Street in New Orleans, this is an example of ___________
distribution.
A. intensive
B. operational
C. selective
D. exclusive
E. administered
Answer:
Use this information to answer the following question that refer to the PSI case.
Pump Systems, Inc. (PSI) produces two major kinds of water pumps. The smaller
pumps range in price from $5-$30, and are used in drinking fountains and soft-drink
machines. Most of these pumps are bought by manufacturers of these machines and
built into their product. PSI also builds larger pumps used in swimming pools and
reservoirs. The prices of these items range from $250-$500. These are usually
purchased by contractors, who build the pools and reservoirs.
PSI sells nationally through sales reps located in the large industrial centers. These reps
handle the selling function for PSI in their geographic areas and provide market
information. They usually do the same thing for 10 to 20 similar manufacturers of
noncompeting products-and are paid on a commission basis.
There are no other producers of the smaller pumps in the United States-because PSI has
patent protection. As a result of this, management has decided to follow a policy of
pricing high-to maximize profits-while the patent lasts.
Several competitors are in the market for the larger pumps. Industry prices and profits
of these pumps have dropped in the past few years as a result of firms trying to increase
their market shares. The product design has remained fairly stable over the last few
years-and one firm dropped out as it saw that it would lose more money with its
"me-too" product. Industry sales are increasing-but at a very slow rate. The price of
these products is determined by adding a standard markup percentage to the variable
cost of the items-to cover fixed costs and profit. For instance, pump Z has variable costs
of $250 per unit, and a markup of 40 percent of this cost is added to the $250 to get its
selling price. Management has estimated that fixed costs applicable to this product are
$200,000 per year.
PSI publishes a product catalog which is revised annually. Also, it exhibits in most trade
shows. PSI follows a policy of charging the same price to all customers-so all will have
the same costs at their own plants. All purchases are shipped directly from PSI's factory
to its customers-and title passes at PSI's factory.
In the PSI case, into which product category do the small pumps (for customers who
use them to replace worn pumps in their own machines) fit?
A. Component parts
B. Raw materials
C. Accessory equipment
D. Installations
E. Supplies
Answer:
A S.W.O.T. analysis
A. seeks to reduce the risk of competitive surprises by scanning the market for 'signals,
warnings, omens, and tips."
B. focuses on what a firm plans to do to 'satisfy wishes of a target" customer.
C. summarizes a firm's 'strategy, wishes (of its customers), outlook, and tactics."
D. helps defend against potential competitors by developing a set of competitive
'safeguards, weapons, offensives, and tactics."
E. identifies a firm's 'strengths, weaknesses, opportunities, and threats."
Answer:
Mark Johnson's business card says he is a "Customer Service Representative" for
OceanView Metal Industries-a wholesaler of standardized steel components used in
construction. Mark answers customer questions about the firm's products and arranges
for routine orders to be sent to the customer's construction site. It appears that Mark is
primarily:
A. a missionary salesperson.
B. a technical specialist.
C. an order taker.
D. an order getter.
E. none of these is a good answer.
Answer:
_____ refers to reliably getting products there exactly before the customer needs them.
A. Total quality shipping
B. Effective gatekeeping
C. Just-in-time delivery
D. On-time vendor management
E. Assured outsourcing
Answer:
Information technology helps physical distribution in what ways?
A. It improves service levels, but doesn't coordinate activities.
B. While it cannot cut costs, it can coordinate activities.
C. It can cut costs and improve service levels.
D. It is overrated and generally fails to improve service levels and coordinate activities.
E. It improves service levels while raising costs.
Answer:
The Consumer Product Safety Commission
A. sets safety standards for new products, but has little power until after a consumer
accident occurs.
B. must approve every new product (including foods and drugs) before it can be sold.
C. provides product liability insurance.
D. can order costly returns of products it considers unsafe.
E. has very little power.
Answer:
Stay-at-home moms who write blogs about child-rearing and have many followers are:
A. sales promotion reps.
B. opinion leaders.
C. direct marketers.
D. laggards.
E. late adopters.
Answer:
A generic market definition includes all of the following terms EXCEPT:
A. customer needs.
B. product type.
C. geographic area.
D. customer type.
Answer:
Use this information for question that refer to the Wire Products Inc. (WPI) case.
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 wire-coated 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 "Wire Locker"?
A. Market introduction
B. Sales decline
C. Market development
D. Market growth
E. Market maturity
Answer:
Use this information to answer the following question that refer to the PSI case.
Pump Systems, Inc. (PSI) produces two major kinds of water pumps. The smaller
pumps range in price from $5-$30, and are used in drinking fountains and soft-drink
machines. Most of these pumps are bought by manufacturers of these machines and
built into their product. PSI also builds larger pumps used in swimming pools and
reservoirs. The prices of these items range from $250-$500. These are usually
purchased by contractors, who build the pools and reservoirs.
PSI sells nationally through sales reps located in the large industrial centers. These reps
handle the selling function for PSI in their geographic areas and provide market
information. They usually do the same thing for 10 to 20 similar manufacturers of
noncompeting products-and are paid on a commission basis.
There are no other producers of the smaller pumps in the United States-because PSI has
patent protection. As a result of this, management has decided to follow a policy of
pricing high-to maximize profits-while the patent lasts.
Several competitors are in the market for the larger pumps. Industry prices and profits
of these pumps have dropped in the past few years as a result of firms trying to increase
their market shares. The product design has remained fairly stable over the last few
years-and one firm dropped out as it saw that it would lose more money with its
"me-too" product. Industry sales are increasing-but at a very slow rate. The price of
these products is determined by adding a standard markup percentage to the variable
cost of the items-to cover fixed costs and profit. For instance, pump Z has variable costs
of $250 per unit, and a markup of 40 percent of this cost is added to the $250 to get its
selling price. Management has estimated that fixed costs applicable to this product are
$200,000 per year.
PSI publishes a product catalog which is revised annually. Also, it exhibits in most trade
shows. PSI follows a policy of charging the same price to all customers-so all will have
the same costs at their own plants. All purchases are shipped directly from PSI's factory
to its customers-and title passes at PSI's factory.
In the PSI case, what is the break-even point for pump Z IN DOLLARS?
A. $200,000
B. $100,000
C. $2,000,000
D. $700,000
E. $500,000
Answer:
As a product moves from the early to the later stages of the product life cycle:
A. distribution moves toward being more intensive.
B. firms either cut prices or just meet competition.
C. promotion becomes frantically competitive.
D. products tend to become more similar.
E. All of these alternatives are correct.
Answer:
A mission statement has the following purposes except:
A. to keep managers working towards a common purpose.
B. to communicate the firm's basic reason for being.
C. to help firms decide what opportunities to pursue.
D. to help firms decide what opportunities to avoid.
E. to provide detailed goals and plans.
Answer:
When a salesperson calls on a new business prospect,
A. he may have trouble identifying all of the buying center members.
B. he usually must see the purchasing manager first.
C. the probability of encountering a gatekeeper is high.
D. All of these alternatives are correct.
Answer:
HP's customers often need help installing its mini-computer systems, so HP should
support the efforts of its order getters with:
A. sales promotion specialists.
B. selling aids.
C. missionary salespeople.
D. technical specialists.
E. order takers.
Answer:
A catalog merchant wants to build a new distribution center that will improve inventory
management, storage of products, shipping, and returns. The company develops a close
relationship with UPS, its main supplier of shipping services. UPS helps the catalog
merchant design its new distribution center so that it coordinates well with the shipping
processes at UPS. This arrangement reduces shipping costs and improves service to the
catalog merchant's customers. This situation is an example of:
A. information sharing.
B. negotiated contract buying.
C. legal bonds.
D. competition.
E. relationship-specific adaptations.
Answer:
