Pricing across a product mix is difficult because various products have related demand
and costs, and products face different degrees of competition.
Profits drop during the growth stage of the PLC because per customer promotion costs
are high.
The demand for many business goods tends to change more slowly than the demand for
consumer goods.
Excess capacity leads to companies initiating an increase in price.
Product differentiation refers to the way a product is defined by consumers on
important attributes—the place the product occupies in consumers’ minds relative to
competing products.
After entering a market by using market-penetration pricing, a company can easily raise
its price and maintain its market share.
The communication effects of advertisements and ad campaigns are more difficult to
measure than the sales and profit effects.
Widespread adoption of the euro has decreased much of the currency risk associated
with doing business in Europe, making member countries with previously weak
currencies more attractive markets.
Direct and digital marketing involves engaging directly with carefully targeted
individual consumers and customer communities to both obtain an immediate response
and build lasting customer relationships.
Multibranding offers a way to establish different features that appeal to different
customer segments, lock up more reseller shelf space, and capture a larger market share.
People differ greatly in their readiness to try new products. In each product area, there
are “consumption pioneers,” also referred to as lagging adopters.
Marketing a product internationally rarely requires a product to be priced differently
depending on the country.
CAFTA-DR has eliminated all trade barriers and investment restrictions among the
United States, Canada, and Mexico.
The marketing mix refers to the set of marketing tools the firm uses to implement its
marketing strategy.
A downward-sloping experience curve is indicative of a company’s rapidly increasing
production costs.
Critics of marketing view consumer interest in material things as a natural state of mind
rather than as a matter of false wants created by marketing.
A company that makes marketing decisions by considering consumers’ wants and
long-run interests, the company’s requirements, and society’s long-run interest is said to
be practicing consumer-oriented marketing.
Search advertisers buy search terms from the search site and pay whenever the search
terms come up in the results of a consumer’s search.
Customer perceptions of the product’s value set the floor for prices.
Companies are increasingly adopting high-commission plans to make sure that
salespersons are motivated to build long-term relationships with customers.
The most common form of advertainment is product placement.
Vertical conflict occurs among firms at the same level of the channel.
One valid criticism of the four Ps concept of the marketing mix is that services are not
considered.
The inside sales force consists of salespeople who conduct business from their offices
via telephone, the Internet, or visits from buyers.
When a producer uses exclusive dealing and the use of exclusive territorial agreements
to keep a dealer from selling outside its territory, it is completely legal.
Market segmentation is the process of seeking fewer customers and reduced demand for
profit maximization only.
Social class is based on shared value systems and common life experiences and
situations.
Business norms vary from country to country. A company will likely be more
successful in expanding internationally if it understands cultural traditions, preferences,
and behaviors in the target countries.
A brief glimpse of the latest LG phone on the television series Modern Family is an
example of an advertainment.
Style is a larger concept than design. Design simply describes the appearance of a
product.
Producers motivate channel members using all of the following EXCEPT ________.
A) using strict rules to force compliance with contract terms
B) partner relationship management
C) working to sell through the intermediaries
D) persuading the intermediaries that they are first-line customers
E) convincing channel members that each will enjoy greater success working together
with a common goal
Which of the following message execution styles focuses on the company’s skill and
knowledge in making the product?
A) endorsement
B) scientific evidence
C) slice of life
D) technical expertise
E) testimonial evidence
________ analysis is an overall evaluation of the company’s strengths, weaknesses,
opportunities, and threats.
A) Porter’s five forces
B) A breakeven
C) A regression
D) A SWOT
E) A cluster
Which of the following is the first step of business portfolio planning?
A) shaping the future portfolio by developing strategies for growth and downsizing
B) determining which businesses should receive more, less, or no investment
C) identifying internal strengths and weaknesses
D) identifying future opportunities
E) determining short-term goals
________ involves gathering primary data by asking people questions about their
knowledge, attitudes, preferences, or buying behavior. It is the most widely used
method for primary data collection.
A) Experimental research
B) Causal research
C) Ethnographic research
D) Survey research
E) Exploratory research
________ is the practice of tailoring products and marketing programs to suit the tastes
of specific individuals and locations.
A) Mass marketing
B) Trigger-based marketing
C) Differentiated marketing
D) Concentrated marketing
E) Micromarketing
In a straight rebuy, ________.
A) the “in” suppliers try to maintain product and service quality to keep the business
B) the “in” suppliers feel pressured to protect an account
C) the “out” suppliers view the situation as an opportunity to gain new business
D) a company buys a product or a service for the first time
E) buyers are keen on revising product specifications
Refer to the scenario below to answer the following question(s).
Jason West, owner of A1 Cleaning, started his enterprise in 2001. Jason’s primary focus
had been on office cleaning for large corporations. But in recent months, Jason has seen
a decline in demand for his office cleaning services. Surprisingly, the competitive
environment appeared relatively stable with no new competitors. However, Jason knew
that office cleaning was a high-frequency service that is usually performed daily;
therefore, competitors must have been doing something to attract his customers.
Building a competitive advantage seemed to be the only option to offset competition.
But as Jason pondered over his dilemma, he realized that prior to building his
competitive advantage he needed to better understand how customers assessed service
quality and what they look for in a superior cleaning service.
Jason developed a research plan. First, he gathered information about his competitors,
primarily through pamphlets and Web sites, as well as through a few phone calls in
order to find out exactly what the competitors offered in their cleaning packages. In
addition, Jason obtained from the Chamber of Commerce an updated list of local
corporations. He planned on sending written questionnaires to them.
Though the list of corporations contained 141 local company names, Jason chose to
survey 75 of them. To better understand customer service expectations between both
small and large corporations, Jason divided his surveys into two categories. The survey
questions were designed to extract specific data from respondents with regard to service
quality expectations in correlation to service frequency and price.
Jason awaited the results. Though his primary focus had been on large corporations, he
was flexible and would aim his efforts differently if needed.
If Jason used mostly open-ended questions in the survey to encourage people to answer
in their own words, he is performing ________ research.
A) focus group
B) qualitative
C) experiential
D) causal
E) exploratory
Which of the following statements is true regarding the affordable method for setting a
promotion budget?
A) It is mostly used by large businesses.
B) It completely ignores the effects of promotion on sales.
C) It tends to place promotion first among spending priorities.
D) It leads to a certain annual promotion budget.
E) It almost always results in overspending.
Rachel loves fashion and is always seen wearing the trendiest fashion outfits. She
actively shares her knowledge with a wide group of friends and colleagues about where
to shop for the latest fashion at great deals. Most of her friends and colleagues follow
her fashion tips. Rachel portrays the image of a(n) ________.
A) surrogate consumer
B) lagging adopter
C) opinion leader
D) brand personality
E) social networker
The two major citizen movements to keep businesses in line are environmentalism and
________.
A) consumerism
B) protectionism
C) liberalism
D) capitalism
E) materialism
Jason Perkins has the informal power to approve the final suppliers in his organization.
In other words, Jason plays the role of a(n) ________ in his organization’s buying
center.
A) gatekeeper
B) decider
C) buyer
D) influencer
E) user
Which of the following is true with regard to price?
A) Historically, price has had the least perceptible impact on buyer choice.
B) Price is the least flexible element in the marketing mix.
C) Unlike product features and channel commitments, prices cannot be changed
quickly.
D) Price is the sum of all the values that customers give up to gain the benefits of
having a product.
E) Prices only have an indirect impact on a firm’s bottom line.
Elmo Inc., a global conglomerate, designed the ElBrush, an electric toothbrush. Sensing
market demand for the electric toothbrush, Elmo started with an ideal selling price of
$13 based on customer value considerations and then targeted costs to ensure that the
price was met. This exemplifies ________.
A) competition-based pricing
B) cost-plus pricing
C) target costing
D) everyday low pricing
E) high-low pricing
Country Kitchen and Perkins are both a chain of family restaurants featuring diner-like
menus with reasonably priced items. These companies are in the same ________.
A) focus group
B) control group
C) strategic group
D) target group
E) experimental group
________ are offers of a trial amount of a product.
A) Samples
B) Coupons
C) Premiums
D) Rebates
E) Price packs
RedFin manufactures diving equipment that is highly regarded by customers
worldwide. Each department in RedFin contributes to its success and can be thought of
as a(n) ________.
A) link in the company’s internal value chain
B) separate organization
C) independent subsidiary of the company
D) separate market segment
E) SBU
________ involves cultivating opinion leaders and getting them to spread information
about a product or a service to others in their communities.
A) Sales promotion
B) Indirect marketing
C) Buzz marketing
D) Stealth marketing
E) Public relations
Business markets are similar to consumer markets in that ________.
A) the nature of the buying unit is the same for both
B) the decision processes involved in both the markets are same
C) both involve people who assume buying roles and make purchase decisions to
satisfy needs
D) both share the same market structure
E) the types of decisions are fairly consistent in both the markets
The ________ market consists of schools, hospitals, nursing homes, prisons, and the
like that provide goods and services to people in their care.
A) government
B) consumer
C) wholesale
D) for-profit
E) institutional
Service ________ means that services cannot be seen, tasted, felt, heard, or smelled
before they are bought.
A) inseparability
B) variability
C) intangibility
D) perishability
E) heterogeneity
Refer to the scenario below to answer the following question(s).
Kimberly’s Crown sells and designs jewelry. Despite the jewelry’s popularity, products
are available only through a few shopping stores across the country.
What distribution strategy does Kimberly’s Crown use?
A) exclusive
B) intensive
C) selective
D) inclusive
E) extensive
A value marketer is most likely to ________.
A) offer consumers superior quality of goods and services at a very high price
B) offer consumers only those products that are associated with status and prestige
C) offer consumers low quality goods and services at very low prices
D) offer consumers a balanced combination of product quality at a fair price
E) deny discounts to consumers to increase profits
Which of the following is true about the product sales force structure?
A) A product sales force structure is most appropriate for a company that manufactures
a small number of simple products.
B) In a product sales force structure, each salesperson is assigned to an exclusive
geographic area and sells the company’s full line of products or services to all
customers in that territory.
C) In a product sales force structure, salespersons specialize in only a particular product
line as the company produces numerous and complex products.
D) In a product sales force structure, a single salesperson can become an expert in all
product categories.
E) In a product sales force structure, specialization is highly discouraged.
Some companies sell primarily to government buyers as prime contractors or
subcontractors. This allows these companies to ________, participate in the product
specification phase, gather competitive intelligence, prepare bids carefully, and produce
stronger communication to describe and enhance their companies’ reputations.
A) lobby elected officials to fund projects
B) anticipate government needs and projects
C) develop relationships with government procurers
D) identify cost-cutting measures
E) invest in new technologies
A company should not always target all possible customers. Which kind of customer is
not the most valuable to a company, but, can over time, contribute to the firm’s success?
A) butterflies
B) shooting stars
C) barnacles
D) true friends
E) strangers
From a market point of view, Universal Pictures film studio might see its competition as
________.
A) Paramount Pictures
B) Warner Bros. Pictures
C) Walt Disney Pictures
D) 20th Century Fox
E) Broadway
Refer to the scenario below to answer the following question(s).
The Attic Trunk opened in 1999 as an upscale dress shop in Forest Ridge’s fashionable
shopping district, catering to a wealthy, mature clientele consisting mostly of older,
first-generation Hispanics. Many other specialty shops lined the main avenue over the
next few years. But as Forest Ridge began to attract a more price-conscious, younger,
and more demographically diverse population, the once-popular shopping district was
increasingly perceived as stodgy and snobby by the new segment of customers.
By the mid-2000s, many of these specialty shops suffered financially. Most shops
attracted only tourists who enjoyed browsing through the displays of alligator belts and
shoes, piles of scented soaps, and so on, often laughing at the ridiculously high prices.
Owners of The Attic Trunk had noticed the shifts in buying behavior of customers by
the mid-2000s. In fact, the owners had observed that the once-fashionable shopping
district in Forest Ridge no longer attracted the wealthy, mature clientele. This clientele
had been replaced with price-conscious families with children, a mix of Asian and
African Americans as well as Caucasians.
Specialty items at The Attic Trunk gradually disappeared, replaced by brand-name
apparel, fashion accessories, and jewelry. Other owners followed suit in the late 2000s,
bringing restaurants, an outdoor cafe, and a day spa to the main avenue in Forest Ridge.
Many families with children are now attracted to the shopping district in Forest Ridge.
What characteristics about families as consumer groups might the owners of The Attic
Trunk want to keep in mind?
A) Though more women hold jobs outside the home today than when The Attic Trunk
first opened, husband-wife involvement in the buying process has remained relatively
unchanged.
B) Children have considerable amounts of disposable income and have a strong
influence on family buying decisions.
C) Women seldom account for any technology-related purchases.
D) Women typically account for most habitual purchases.
E) Men make all the major purchasing decisions in most families.
Which of the following is a demographic factor that a company should consider before
deciding to enter into a new country?
A) transportation structure
B) natural resources
C) political stability
D) languages
E) education
Which of the following best explains why companies are adopting the team selling
approach to service large, complex accounts?
A) Products have become too complicated for one salesperson to handle a large
company’s needs.
B) Customers prefer dealing with many salespeople rather than one sales representative.
C) Job rotation, an integral part of team selling, keeps workers motivated and boosts
their morale.
D) Team selling facilitates the evaluation of individual contributions.
E) With team selling, companies are not required to train the outside sales force any
longer.
How do marketers respond to critics’ accusations of planned obsolescence?
Describe the nature of personal selling and the role of the sales force.
What does marketing ROI measure?
Briefly describe how economic conditions impact a firm’s pricing strategies.
Why do marketers find baby boomers attractive?
Explain the factors involved in setting international pricing.
What is personal selling?
Why are more companies using team selling? What are its pros and cons?
How do salespeople qualify prospects?
What elements comprise a store’s atmosphere?
Give examples of competitor objectives and discuss the importance of knowing a
competitor’s mix of objectives.
List three variables that are used in segmenting business markets.
Describe the main objectives of reminder advertising.
Compare the three different types of industrial structures.
Briefly explain why marketers need marketing research in addition to competitive
marketing intelligence.
What factors determine the success of a company’s value chain?