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Selective distribution is growing in popularity because it provides 100 percent coverage
of the market.
In general, most sales presentations follow the sequence of stages in the AIDA model.
If a firm produces the right goods or services, marketing has little role to play in
creating customer satisfaction.
Prospecting involves following all the "leads" in the target market.
A "distribution center" is a special kind of public warehouse designed specifically for
storing perishable products.
A determining dimension for segmenting markets actually affects the purchase of a
specific brand in a product-market.
A mission statement sets out the strengths and weaknesses of a firm as well as the
opportunities and threats that it faces.
The length of each stage in the product life cycle is set.
A company with a successful marketing strategy has its own internal source of
fundsprofits.
Demand estimates are required for demand-backward pricing to be successful.
Publicity is the nonpersonal presentation of ideas, goods, or services which is paid for
by an identified sponsor.
In the total profit approach, management forecasts potential sales and costs during the
life of the plan to estimate likely profitability.
A basic idea in the legal environment in the United States is that attempts by business to
limit competition are considered contrary to the public interest.
Coordinating the linkages between marketing and other functional areas is likely to be
easier when a strategy involves developing a totally new product idea rather than just
modifying an existing plan and established ways of doing things.
Despite the functions they provide, the number of wholesalers in the United States has
decreased 16 percent in the last 15 years.
The three basic jobs in the marketing management process are planning,
implementation, and control.
Product warranties are regulated by the Magnuson-Moss Act.
"Pulling" a product through a channel of distribution focuses promotion efforts on
wholesalers and retailers to get them interested in a producer's marketing mix.
If a manager sells more than was expected when average-cost pricing was used to set a
price, the firm will lose money.
A firm may spend 50 percent or more of its total marketing dollars on PD activities.
Advertising objectives should be very specific, even more specific than personal selling
objectives.
Clustering is a technique that divides a large group of people into smaller groups, so
that each small group is as diverse as the large group from which it was formed.
In the example for the 7-step approach (used in the text), it's useful to consider what
people in each segment want, but it's useless to consider what they don't want because it
will have no bearing on whether that segment is profitable for the firm.
Gen X is less educated than previous generations.
Convenience products include staples, impulse products, and emergency products.
A generic market description looks at market broadly and from a customer's viewpoint.
To fully understand the nature of competition and the speed of the relevant product life
cycle, it is important not to define a market too narrowly.
In less-developed economies, retail shopkeepers typically use a one-price policy.
Market-directed economies tend to provide consumers with greater freedom of choice
than command economies.
One reason personal selling is important in promotion to intermediaries is that
marketing mixes often have to be adjusted from one geographic territory to another and
from one intermediary to another.
A sales manager who wishes to supervise and control his salespeople's activities closely
should pay them a straight salary instead of a straight commission.
Looking at the "average" satisfaction of a whole society does not provide a complete
picture for evaluating macro-marketing effectiveness.
Natural accounts show the purpose for which expenditures are made.
A distribution center is a special kind of warehouse designed to perform regrouping
activities.
The Product area of the marketing mix may involve a service and/or a physical good
which satisfies some customers' needs.
In the United States, the Consumer Product Safety Commission sets and enforces
product safety standards.
Specialized search engines like Blogdex and Google Groups can locate websites that
allow marketing managers to listen in or ask questions as customers chat about
companies and brands.
Traditional channels of distribution
A. do not perform bulk-breaking activities.
B. are usually preferred to other distribution arrangements.
C. are easier to control than corporate channel systems.
D. may involve little or no cooperation among channel members.
E. are usually controlled through strong legal contracts.
If a manufacturer in China offers a product in the U.S. market at a lower price than in
China, this may be a violation of a(n):
A. Price-fixing law.
B. Price discrimination law.
C. Truth-in-advertising law.
D. Antidumping law.
E. Monopoly law.
Kayla Jurgenson, marketing manager for Super Gaming Computers and Accessories
(SGCA), is reviewing her company's plans for the coming year.
SGCA sells its products through retail computer dealers and some specialty gaming
stores. Currently, SGCA is carried in 25 percent of all retail computer stores nationwide,
but in California is carried in only 10 percent of stores. So, Kayla has set an objective of
being in 25% of all retail computer stores in California within one year.
SGCA plans to introduce a new SuperDuperGamer model with special features that fits
its target market of teen and young adult gamers. The SuperDuperGamer uses a new
technology and is expected to be a breakthrough product, but it will be important to
build awareness for it to succeed. So, the advertising objective is for 40% of SGCA's
target market to be aware of the new SuperDuperGamer model within 3 months. SGCA
also wants to help its retailers reduce their current stock of SuperGamer computers
before the new model comes out in a month. The SuperGamer has been on the market
for two years and has been a top seller in the category. SGCA's advertising objective for
the SuperGamer computer is to reduce current dealer stock by 80% within the next
month.
SGCA is also introducing a SuperEnhancer sound card, which is designed to
significantly enhance the game-playing experience with older computers. Research with
gamers show that it is very well received, so the advertising objective for the
SuperEnhancer sound card is to gain 40% market share among all gaming-specific
sound cards in the next year. To help achieve that objective, Jurgenson is planning to
use an ad that shows the sound card and a game player being knocked off his chair by
the sound. The headline on the ad reads, "9 Out of 10 Gamers Say that the
SuperEnhancer Sound Beats All Others!"
About 10 years ago, most of SGCA's target customers did not even know what a sound
card was or that computer audio could be upgraded. What type of advertising was
needed at that time?
A. institutional advertising
B. reminder advertising
C. cooperative advertising
D. pioneering advertising
E. direct competitive advertising
Wu Chen frequently travels to Caracas, Venezuela where the only hotel he will stay at is
the Crown Prince Hotel. His level of brand familiarity toward the Crown Prince Hotel is
______
A. brand awareness.
B. brand familiarity.
C. brand rejection.
D. brand recognition.
E. brand insistence.
A product line is a set of individual products that are closely related in which of the
following ways?
A. They are sold to the same target market.
B. They are produced and/or operate in a similar manner.
C. They are priced at about the same level.
D. They are sold through the same type of outlets.
E. Any or all of these alternatives are correct.
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.
What sales presentation approach does Charlie Riggs use?
A. missionary presentation.
B. prepared sales presentation.
C. consultative selling approach.
D. selling formula approach.
E. no sales presentation approach is used because he just calls people and says what he
learned during training.
Consumers in the U.S. generate more trash per person than anywhere else on the planet
and packaging is a major contributor to this dilemma.
What basic promotion objective should be sought by a producer whose Product is very
similar to its many competitors' Products?
A. Persuading
B. Promoting
C. Communicating
D. Informing
E. Reminding
In 2010, about _______ percent of ad spending in the U.S. was for television and cable
advertising.
A. 15
B. 20
C. 25
D. 30
E. 35
The Horizons Cycle Shop bought 3 motorcycles for $2,100, and sold each one for
$1,000. The markup percent was:
A. 33 1/3.
B. 30.
C. 142.
D. 50.
E. There is not enough information to tell.
Almost any business transaction in a modern economy involves:
A. an exchange at a list price.
B. "dumping."
C. an exchange of moneythe money being the Pricefor something of value.
D. a loss of consumer surplus.
E. an exchange in which price serves as a measure of quality.
Reminder ads come under which stage of the adoption process in advertising?
A. Awareness
B. Interest
C. Evaluation and trial
D. Confirmation
E. Decision
Midwest Tools, Inc. of Indianapolis, Indiana owns a plant in Poland for manufacturing
and selling machine tools in Europe. This type of international involvement is called:
A. management contracting.
B. licensing.
C. a joint venture.
D. a direct investment.
E. multichanneling.
In the market growth stage of the product life cycle:
A. competing products become almost the same in the minds of potential consumers.
B. distribution moves from intensive to selective.
C. many competitors drop out of the market.
D. total industry sales increase very slowly.
E. total industry profits reach their peak and begin to decline.
Kelly Stich, marketing manager for Yummy Ice Cream Products, is thinking about some
of her products and her promotion plans for the coming year.
Yummy Ice Cream Products is introducing a new ice cream treat called PlanetSavers.
This treat uses ice cream produced with environmentally friendly processes that save
energy and protect the ozone. Yummy plans to send articles to magazines, local
newspapers, and environmental groups that explain the environmentally safer treat. The
product also has a unique texture and different flavor.
Stich wants to use counter cards and in-store signs to let people know about Cherry
Walrus, the company's new flavor. She is also developing sales training materials that
will teach ice cream scoopers in Yummy's ice cream stores to promote the product.
Right after Cherry Walrus is introduced each store will also hand out coupons that are
good for one day only.
Yummy Mondaes is a product that has been around for 25 years. It is Yummy's take on
the classic ice cream sundae, but white-brownie and coffee-flavored crumbles are added
to make it extra special. The company sells this product in one and two quart containers
through major grocery store chains. It relies on personal selling and price discounts to
retailers to move more of the product. The company does very little consumer
promotion for this product.
Yummy Fudge on a Stick is a new product of fudge-flavored ice cream on a stick.
Yummy plans to sell it through retail grocery stores also and is launching an aggressive
advertising program that will use television, radio, newspaper, magazines, and the
Internet. Most of its promotion will be directed at consumers.
Two years ago the company introduced Yummy Fruit on a Stick, an all-natural frozen
fruit product on a stick. The product category has been popular, continues to grow, and
is in the market growth stage of the product life cycle.
Which of the following illustrates communication "noise"?
A. A radio ad for Planet Savers is recorded at a higher volume than the music.
B. A consumer waiting in line for an ice cream cone can't see the sign promoting Cherry
Walrus because the store is so crowded.
C. A consumer who thinks that environmentally friendly ice-cream is a stupid idea
decides to try the new Planet Savers flavor anyway.
D. A TV ad for Yummy Fudge on a Stick features a large group of children singing and
eating Yummy ice cream.
E. All of these illustrate "noise."
Which of the following is NOT a true statement about traditional channel systems?
A. Channel members make little or no effort to cooperate with each other.
B. Channel members buy and sell from each other.
C. Each channel member does only what it considers to be in its own best interest.
D. Members of these channels have their independence, but they may pay for it too.
E. Control is maintained by economic power and leadership.
When a supermarket manager decides to offer online ordering at the store's website, this
is a decision about:
A. Product.
B. Place.
C. Promotion.
D. Price.
A 'skimming pricing policy":
A. should be used if a firm expects strong competition very soon.
B. is most useful when demand is very elastic.
C. is typically used during the sales decline stage of the product life cycle.
D. usually involves a slow reduction in price over time.
E. means temporary price cuts to speed new products into a market.
_____ refers to an organized way of continually gathering, accessing, and analyzing
information that marketing managers need to make ongoing decisions.
A. Active marketing
B. Manufacturing information system
C. Marketing research
D. Marketing information system
E. Target marketing
Mrs. Moreau was planning to have several guests at her home for a traditional
Thanksgiving dinner. She had cooked Shady Brook Farms fresh turkeys in the past and
had enjoyed them very much. When she went to her usual grocery store, she discovered
that the store no longer carried the Shady Brook Farms brand. She called several other
grocery stores and was finally able to locate Shady Brook Farms fresh turkeys at a
small specialty grocery store approximately 10 miles away. She drove to the store and
bought a 20-pound Shady Brook Farms turkey, even though the price per pound was
higher than what she normally paid at her usual grocery store. For Mrs. Moreau, the
Shady Brook Farms turkey was a(n):
A. Homogeneous shopping product.
B. Specialty product.
C. Heterogeneous shopping product.
D. Convenience product.
E. Unsought product.
Which of the following statements about manufacturers is true?
A. Industrial customers are concentrated in countries that are at the more advanced
stages of economic development.
B. Manufacturing output in the U.S. is shrinking.
C. Countries with cheap labor have a slow rate of growth.
D. Many factories are concentrated in rural areas of the U.S.
E. Currently, U.S. manufacturing output is at its lowest point since 1980.
Which of the following best illustrates a "breakthrough opportunity?"
A. A recording company's new CD gets unexpected national publicity on MTV and
almost every teenager wants a copy for Christmas.
B. A drug company develops a patented pill that people can take once a year and safely
avoid catching a cold.
C. A bank puts its credit card machines in convenient drive-up locations--so they will be
more convenient for customers.
D. A nurse realizes that the growing number of older people will increase the demand
for nursing home services, so she quits her job and opens a quality nursing center for
the elderly.
E. A wireless phone company introduces a new service that offers more free weekend
minutes than any other service in its market area.
Tammy works in transportation for a company that manufactures tractors and other
farm equipment in China for the U.S. market. Cost is her primary concern in getting
products to farm states in the U.S. Midwest. Which mode(s) of transportation would
you suggest?
A. Water then truck.
B. Air then rail.
C. Air then truck.
D. Air only.
E. Water then rail.
Integrated direct-response promotion has expanded beyond direct-mail advertising to
include other media.
McGovern's Supply stocks electronic repair parts and related supplies and tools from
various producers. McGovern's sells primarily to small TV and electronic repair shops
throughout the country that only want to order one or two items at a time. Orders are
usually shipped out on UPS trucks. It appears that McGovern's is a
A. single-line wholesaler.
B. manufacturers' agent.
C. drop-shipper.
D. truck wholesaler.
E. rack jobber.
The recent interest in physical fitness has forced producers of food, clothing, and other
products to reconsider their marketing strategies. Which of the following does this trend
illustrate?
A. Economic and technological environments.
B. Cultural and social environment.
C. Existing business situation.
D. Political and legal environment.
E. Resources and objectives of the firm.
A producer of high quality stereo component equipment has developed a new line of
very inexpensive, low quality "rack systems" to sell through discount stores. It probably
should not use its current ______________ brand for the new line.
A. dealer
B. licensed
C. national
D. family
E. generic
If a profit-oriented marketing manager doesn't know the exact shape of the firm's
demand curve, marginal analysis:
A. is useless.
B. may be useful anywaybecause a profitable region usually surrounds the best price.
C. will suggest the same price as break-even analysis.
D. suggests that the only sensible approach is to follow the market leader.
E. None of these alternatives is true.
Which of the following would not engage in the process of marketing?
A. The United Way
B. United States Postal Service
C. Outback Steakhouse
D. JFK International Airport
E. Sam's Club members
The Federal Fair Packaging and Labeling Act calls for all of the following EXCEPT
A. consumer goods be clearly labeled in easy-to-understand terms.
B. industry to try and reduce the number of package sizes.
C. food manufacturers to use a uniform format that allows consumers to compare the
nutritional value of different products.
D. industry to make labels more useful.
E. None of these (i.e., all of these are part of the Federal Fair Packaging and Labeling
Act).
A producer with only one product has total fixed costs of $15,000 per month. In
addition, it cost the producer $100 in variable costs to produce each unit of his product
(raw materials and direct labor cost). The producer charges his wholesalers $125 per
unit. What is the sales amount to break even?
A. $70,000
B. $75,000
C. $80,000
D. $85,000
E. $90,000
Marginal analysis:
A. can be very useful if a firm's pricing objective is profit maximization.
B. focuses on the last unit which will be sold.
C. can be used to find the most profitable price and quantity.
D. can help find the price that results in the greatest difference between total revenue
and total cost.
E. All of these alternatives are correct.
Regarding message planning and the AIDA model:
A. "getting action" is the final and easiest step in the process.
B. focusing on one unique selling proposition is one way to arouse desire.
C. a successful attention-getting device assures "holding interest."
D. "arousing desire" is the first and hardest step in the process.
E. All of these alternatives are correct.
A standard markup is often set close to the firm's
A. gross margin.
B. net profits.
C. overheads.
D. operating costs.
E. competitors' costs.
