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Apple's Genius Bar is a good example of a company offering its customers "branded
services."
Firms that are described by NAICS code 3152 are more similar than firms described by
NAICS code 31.
The marketing concept cannot be applied to nonprofit organizations because they are
not profit-oriented.
Although the customer should be the target of all marketing efforts, customers are not
part of a marketing mix.
Marketing functions are performed by producers, consumers, and a variety of marketing
specialists.
The adoption curve shows when different groups will accept new ideas, assuming that
the promotion effort should stay the same for all groups.
Loading truck trailers on railcars for shipment closer to the trucks' destination points is
called "piggyback service."
Telephone selling (telemarketing) to consumers is still extremely popular despite the
National Do Not Call Registry.
Cost considerations usually favor more aggregating and larger market segments, but
smaller segments may be required to satisfy needs more exactly.
Examples of packaging's role of protecting include its link to promotion and its role in
conveying product information.
Big data involves data sets too large and complex to work with typical database
management tools.
A low stockturn decreases inventory carrying cost and frees up working capital.
A good situation analysis is usually inexpensive compared with more formal research
efforts, such as a large scale survey.
Integrated marketing communications means the intentional coordination of every
communication from a firm to a target customer to convey a consistent and complete
message.
From a micro view, marketing activities are performed only by profit-oriented
organizations.
Dimensions that should be looked at when segmenting consumer markets are:
geographic location and other demographic characteristics, behavioral needs, urgency
to get needs satisfied, and willingness to compare and shop.
Limited-function wholesalers provide only some of the wholesaling functions.
The total cost of mass media may force a small firm to use promotion alternatives that
are more expensive on a per contact basis.
Competitive barriers are the conditions that make it possible for a firm to compete in a
market.
In the pushing effort, an intermediary is likely to pay more attention to the producer that
offers it the best profit potential.
Capital is the financial term for the amount of money invested in a firm.
A sales-oriented pricing objective seeks some level of unit sales, dollar sales, or share
of marketwithout referring to profit.
The more narrowly we define a product-market, the shorter the product life cycle
because improved product ideas come along to replace the old.
A wholesaler might help a producer by reducing the producer's need to carry large
inventory stocks.
"Economies of scale" prevent a company from taking advantage of mass production.
An effective macro-marketing system overcomes discrepancies of quantity and
discrepancies of assortment by using the universal functions of marketing.
The General Electric 'strategic planning grid" relies on subjective judgments about
business strengths and industry attractiveness.
Any contractual channel systemby definitionis also an administered channel system.
A firm with a "competitive advantage" has a marketing mix that the target market sees
as better than a competitor's mix.
With the observation method, the researcher skillfully engages the subject in
conversation.
Consumer products which offer really new ideas that potential customers don't know
about yet are new unsought products.
Customer lifetime value is the expected earnings stream (profitability) of a firm's
current and prospective customers over some period of time.
An economic system is the way an economy organizes to use scarce resources to
produce goods and services and distribute them for consumption among various people
and groups in the society.
A product that is new in any way for the company concerned is a new product,
according to the text.
The basic strategy planning decisions for advertising, publicity, and sales promotion are
the same regardless of where in the world the target market is located.
The U.S. population is over 310 million people and the world population is more than 7
billion people.
Put the steps of the personal selling process in order: Prospect for new customers;
Select target customer; Preplan sales call and presentation; Make sales presentation;
______________; and Follow up after the sales call.
A. Create interest
B. Open sale
C. Overcome objections
D. Close sale
E. Contact buyer
Macro-marketing:
A. is concerned with the activities performed by individual business organizations.
B. tries to match heterogeneous supply capabilities with heterogeneous demands for
goods and services.
C. is concerned with how effectively and fairly an individual business organization
performs.
D. assumes that the effectiveness and fairness of all macro-marketing systems must be
evaluated in terms of the same social objectives.
A good marketing manager knows that:
A. the costs allocated to functional accounts during a marketing cost analysis should
equalin totalthose in the natural accounts.
B. functional accounts usually are needed for determining the profitability of customers.
C. functional accounts usually are needed for determining the profitability of products.
D. All of these are true.
E. Only functional accounts usually are needed for determining the profitability of
customers; and functional accounts usually are needed for determining the profitability
of products; are true.
Regarding the family life cycle, singles and younger couples without children
A. are more willing to try new products and brands.
B. tend to be carefree shoppers who are not very price-conscious.
C. often wait to buy basic durable goods until they have children.
D. feel more financially squeezed than couples with young children.
E. All of these are correct for singles and younger couples without children.
A potential customer watches a TV ad for the new BMW 7-series sedan during the
highly-rated Academy Awards program. In the traditional communication model, the
TV is the:
A. Source.
B. Message channel.
C. Receiver.
D. Encoder.
E. Decoder.
_____ means trying to increase sales by selling present products in new markets.
A. Differentiation
B. Market development
C. Product development
D. Diversification
E. Market penetration
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.
United's shipments to international markets often rely on containerization. The likely
reason for this is that
A. the tools are shipped by airfreight.
B. it makes it easier to move shipments between different transportation modes.
C. containerization is very useful for small, frequent shipments.
D. containerization allows a firm to carry less inventory.
E. All of these are benefits of containerization.
Which of the following criteria should a marketing manager use when segmenting a
broad product-market?
A. The segments should be operationali.e., only quantitative dimensions are useful.
B. The people in different segments should be as heterogeneous as possible with respect
to their likely response to marketing mix variables.
C. The people within a market segment should be as heterogeneous as possible with
respect to their likely response to marketing mix variables.
D. The market segments should be substantiali.e., big enough to minimize the firm's
costs.
E. All of these criteria would be useful.
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."
What is Digital Imaging's pricing objective?
A. status quo oriented.
B. sales oriented.
C. profit oriented.
D. target return.
E. None of these is a good answer
Strategy "Place" decisions would NOT include:
A. type of physical distribution facilities.
B. type of channel of distribution.
C. degree of market exposure desired.
D. distribution customer service level.
E. how to train wholesalers' salespeople.
Capitol Periodical Distributors is a wholesaler providing assistance to retailers that want
to carry books and magazines. A retailer provides Capitol with a certain amount of floor
space, and Capitol uses the space to install display racks. Capitol fills the racks with
magazines and books that would be suitable for the retailer's target market. Every week
a representative from Capitol comes in to remove any outdated publications and refill
the racks. This practice helps the retailer serve its customers better than if the retailer
tried to manage the books and magazines itself. Capitol Periodical Distributors is a:
A. Specialty wholesaler.
B. Drop-shipper.
C. Catalog wholesaler.
D. Rack jobber.
E. Cash-and-carry wholesaler.
Which of the following is not an element of the external market environment?
A. Technological environment.
B. Company environment.
C. Legal environment.
D. Economic environment.
E. Cultural and social environment.
With respect to buyer-seller relationships in business markets,
A. relationships benefit sellers, but not customers.
B. some customers simply are not interested in a close relationship with a supplier.
C. customer firms are better off selecting suppliers with competitive bids rather than
establishing a relationship with a single vendor.
D. None of these alternatives is true.
Each of the following types of businesses could most likely be part of both the supply
chain and the distribution channel for a cosmetics retailer EXCEPT:
A. A warehouse that stores finished cosmetic products before shipping.
B. A storage company that coordinates both storage and transport.
C. A research and development firm focused on cosmetics testing.
D. An air freight company that transports the cosmetic line overseas.
E. A ground parcel service that ships wholesale orders to retail stores.
A company where the marketing people do both short-run and long-range planning is
operating in the
A. marketing company era.
B. sales era.
C. simple trade era.
D. marketing department era.
E. production era.
Committee buying in large retail chains
A. makes the buyers work as a group and thus lower costs.
B. allows a sales rep to avoid a difficult buyer.
C. makes it difficult for the seller to see a buyer personally.
D. reduces the impact of a persuasive sales rep.
E. All of these alternatives are correct.
Brand recognition, brand preference, and brand insistence are various levels of _____.
A. brand rejection
B. branding
C. brand familiarity
D. brand equity
E. brand marks
In spite of high cost, high value, low-weight goods like high-fashion clothing and parts
for the electronic industry are often shipped long distances by ____
A. rail.
B. water.
C. air.
D. pipeline.
E. truck.
Jan Alvarez works for a cable TV company in a large city. She makes telephone calls
during the early evening and tries to sell cable services to nonsubscribers. Jan is
A. a technical specialist.
B. a sales promotion specialist.
C. an order taker.
D. an order getter.
E. a customer service rep.
The price that maximizes profit is the one that results in the greatest difference between
A. total cost and total fixed cost.
B. total revenue and total cost.
C. average cost and average variable cost.
D. total revenue and average variable cost.
E. total revenue and average fixed cost.
Regarding product life cycles, good marketing managers know that:
A. all competitors lose money during the sales decline stage.
B. they are getting longer.
C. industry sales reach their maximum during the market growth stage.
D. firms earn their biggest profits during the market introduction stage.
E. industry profits reach their maximum during the market growth stage.
In a firm that has a total company effort in implementing the marketing concept:
A. There are "fences" around individual departments.
B. Not all departments impact customer satisfaction.
C. The firm lacks a central focus.
D. Departmentseven very specialized onesare guided by what customers want.
E. The firm is more production-oriented than marketing-oriented.
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 of the following is true about Melissa Tran's sales position?
A. Recruiting for this job would not require a job description.
B. It involves major account management.
C. The job would not require product trainingonly sales training.
D. It involves missionary sales.
E. None of these alternatives is true for Melissa's sales position.
According to the Federal Trade Commission (FTC), a new product:
A. Is only new for twelve months.
B. Is only new for two months.
C. Is entirely new or changed in a functionally different or substantial respect.
D. Is something that is new in any way for the company concerned.
E. None of these is a good answer.
A professional salesperson:
A. is only expected to "get rid of the product."
B. has only one basic jobto communicate the company's story to customers.
C. may be given a title such as field manager or market specialist.
D. is expected to overcome the customer's objectionwhatever it may be.
E. None of these alternatives is correct.
A producer of electrical components combined electrical supply wholesalers and
manufacturers of electrical equipment into the same market segmentone of several
segments it was targeting. Soon it lost the manufacturers' business to a competitor. It
seems that the firm failed to consider the risk of
A. too much aggregating.
B. insulting the manufacturers by putting them in the same market segment with the
wholesalers.
C. picking market segments based on qualifying dimensions.
D. selecting market segments that were not substantial.
E. using too many segmenting dimensions.
A straight rebuy
A. involves setting product specifications and evaluating sources of supply.
B. occurs when an organization has a new need and the customer wants a great deal of
information.
C. is an in-between process where some review of the buying situation is done.
D. occurs when an organization has a new need but the customer wants only minimal
information.
E. is a routine repurchase that may have been made many times before.
Intermediaries in indirect channels of distribution:
A. Often perform functions that producers cannot perform efficiently by themselves.
B. Do not provide additional convenience to consumers.
C. Increase the need for producers to make large investments in distribution facilities
and personnel.
D. Make it necessary for producers to carry more inventories.
E. None of these alternatives is correct.
In the market maturity stage
A. sales promotion may be targeted at channel members to get them interested in selling
the new product.
B. mass selling becomes more economical.
C. business products require less aggressive personal selling.
D. mass selling and sales promotion may dominate the promotion blends of consumer
products firms.
E. the main job is to persuade customers to buy, and keep buying, the company's
product.
A macro-marketing system should:
A. provide everyone with the same goods and services.
B. be part of a market-directed economy, not a command economy.
C. accomplish a particular society's objectives, whatever they are.
D. depend solely on a society's political institutions.
You have just been asked by your manager to compile data on firms in California that
have a specific 4-digit NAICS code. You should know
A. that there are no 4-digit NAICS codes.
B. that there is only one firm to find, since each firm has its own 4-digit NAICS code.
C. that it is possible that no data will be available, even if there is one large firm in
California in that 4-digit industry.
D. that she is talking about the New Auto Industry Classification Survey.
E. that none of these alternatives is correct.
When getting information for marketing decisions, the marketing manager:
A. may use both internal and external sources of information.
B. may need to make some decisions based on incomplete information.
C. may need to rely on his or her own instincts to make some decisions.
D. should have access to ongoing information about business performance.
E. All of these alternatives are correct.
______________ segmenting dimensions are those which actually affect a person's
purchase of a specific product type or brand in a product-market.
A. Operational
B. Qualifying
C. Customer-related
D. Determining
E. Situation-related
The "80/20 rule" says that:
A. only 20 out of every 100 firms use formal accounting controls.
B. a firm should hire 20 sales reps for every 80 customers.
C. marketing accounts for 80 percent of a typical consumer's dollar.
D. even though a firm is showing a profit, 80 percent of its business might be coming
from only 20 percent of its customers.
E. usually about 20 percent of a firm's customers are unprofitable.
Which of the following is most likely to increase a firm's customer equity?
A. The firm offers a more costly marketing mix that attracts more customers.
B. The firm offers customer value that is at least as good as what is offered by
competitors.
C. The lifetime value of the firm's individual customers increases.
D. The competition in the firm's market increases.
E. The firm cuts costs by reducing promotion efforts.
