BUAD479: Final Exam

True or false: A consumer hears pleasing background music and recognizes the celebrity sponsor for a fast-food company. After seeing this ad, she has a more positive attitude about this company. This is an example of the company using the central route to persuasion in the ELM model.

False

True or false: A supplier should use only one distribution channel structure or configuration (e.g., supplier to wholesaler to retailer) for optimal performance.

False

True or false: Humor is attention grabbing and entertaining, but it is not as effective as fear appeals in increasing purchase intent.

False

True or false: Using a one-price policy (i.e., where all buyers pay the exact same) is the only fair approach to pricing. In the United States, it is illegal for companies to customize prices.

False

True or False: Iron Man 3 is a good example of an umbrella brand

False. Iron Man 3 is a brand extension, or the use of an existing brand name on a new product in a related or different category.

True or false: Profit is the difference between the total revenue generated and COGS

False. Profit is total revenue-total costs

True or false: The best approach to distribution strategy is sequential. Design a channel structure first, then manage the behavior of channel members.

False. The notion of channel stewardship is that channel design and channel management should be approached in an integrated, rather than sequential, fashion.

True or false: In advertising, the use of sexual appeals works in almost all buying contexts as long as the advertising uses innuendos instead of explicit, sexual imagery and narratives.

False. The rule is "Sex sells, under some conditions". Sexual appeals generate higher recall, more positive attitudes, and higher purchase intent-- but only among low-involvement consumers.

True or false: True economic value (TEV) is reduced when a customer is not aware of all the features or benefits that a product claims to offer.

False. The value-pricing approach to product pricing is driven by specific factors, one of which is the "objective value" that the product delivers to the consumer. Also called true economic value (TEV), objective value is a measure of the benefits, relative to other products, that the product delivers to the consumer, regardless of whether the consumer recognizes those benefits.

True or false: An aspect of product performance that is mission-critical, such as safety for an automobile, increases price sensitivity.

False. When an aspect of product performance is mission-critical, such as safety for an automobile, price sensitivity is suppressed because of the importance of the factor.

All of the following are examples of commonly used market research procedures for assessing price sensitivity EXCEPT:

Focus groups (qualitative, not projectable to larger audiences)

What are the reasons cost-plus pricing is so popular?

It is easy to justify to various stakeholders, it simplifies an otherwise complex pricing process. It is easy to measure or estimate.

Which of the following is an example of a retailer using mobile marketing to enrich the customer's shopping experience at the same time that they stimulate buying?

Lacey's department store uses a virtual tour app of Paris to promote a week-long celebration revolving around French-themed clothing, jewelry, and fragrances in their stores.

_______ might appear anywhere on an Internet user's screen when a user is browsing through an article, and they are often related to the information being viewed.

Online display ads

________ might appear anywhere on an Internet user's screen when a user is browsing through an article, and they are often related to the information being viewed.

Online display ads

One role of marketing communications in the problem recognition stage of the purchase decision-making process is to:

remind consumers of existing needs.

A company using a press release to explain the resignation of its former CEO who was involved in a scandal is an example of a company using __________ to maintain its company image.

Public relations

In an arm's length channel system where the supplier/steward exerts little direct control over channel intermediaries, the channel steward may have to resort to performing value-adding activities itself, such as TV advertising, consumer promotions, and so on, so that even before the consumer enters the store, she or he is looking only for the supplier's brand. Which promotional strategy does this discussion describe?

Pull

Gustaves Electronics are a leading brand in kitchen appliances. Recently, the company released a new line of blenders called Amalgee. But the sales of Amalgee did not meet the expected figures. To boost sales, Gustaves decided to give scratch-and-win coupons to all buyers, with a chance to win a three-day trip to the Carribean for the lucky buyer. Which of the following elements of the promotion mix did Gustaves utilize to boost Amalgee's sales?

Sales promotion

What branding lesson can be derived from the "Wedge of Lime" video?

The importance of understanding and listening to consumers to match brand personality to the targeted audience.

Several factors are driving the rise of online channels. Online music distribution and online book sales are two examples. Which factor below is a contributor to the increase in online distribution?

The product is easily digitized.

True or false: Some contemporary models of communications have reconceptualized the classic Think-Feel-Do model to the Do-Think-Feel model to reflect more accurately actual communications effects given a particular type of product or purchase occasion.

True

True or false: Tide laundry detergent uses an indirect distribution channel, and the reason it does so is because its market is fragmented and dispersed.

True

A channel steward uses power to influence, motivate, and manage channel partners. An example of a channel steward's use of hard power is a:

brand's unique product design

Most executives agree that brand strategies must be engineered across the entire marketing mix and throughout the life cycle of a product. Which of the following is NOT a component of that marketing mix? (A) Pricing. (B) Market research (C) Production (D) Innovation

B, C, and D

Marketers often use which of the following technique to determine the impact of a price change?

Breakeven analysis

You are working with Starbucks to increase consumer landings on the company's web pages, which promote and sell Starbucks' at-home coffee-brewing systems. One way to increase such landings is to work for better organic search engine results through search engine optimization (SEO). Which of the following tactics should you follow in your SEO program for Starbucks?

Build the site's authority by determining ways to garner more mentions on other, nonaffiliated websites.

All of the following are inputs to any value-pricing decision

COGS, TEV, and perceived value

True or false: Channel stewardship is the same as channel management.

Channel management is only part of channel stewardship. Channel stewardship is about setting the rules that govern the daily behavior of the supplier and channel partners, whereas stewardship is the integration of channel management and channel design.

Owned media encompasses various types of media such as:

Company-owned retail stores, company-owned social media channels, employee uniforms and truck signage, and product catalogs.

Research indicates that which of the following plays the greatest role in the product purchase decision process?

Customer reviews/recommendations

According to Halligan, digital marketers are making bad inbound marketing choices. Which of the following choices is one of them?

Dabbling in inbound marketing and not going fully in. Not measuring effectiveness well. Not realizing that the role of the sales rep has changed.

Which function below is NOT one of a channel intermediary's functions?

Developing the brand's national TV advertising campaign

Four pillars of BAV

Differentiation, Esteem, Knowledge, and Relevance

As a marketer, your goal is to use one type of digital marketing tool to both spur consumers to immediate action and to increase brand awareness. Which of the following digital marketing tools would you use?

Display ads

Ralph Lauren Cosmetics gives a limited number of dealers the sole rights to distribute the company's products in their territories. Such a distribution strategy is called _________ distribution.

Exclusive

Which of the following distribution decisions is NOT part of channel coverage?

Expand internationally

A major challenge in designing marketing communications is being able to grab the attention of the target audience in a crowded media field. Which of the following factors contribute to creating this challenge?

Fragmentation of mass media. Proliferation of alternative ways to reach consumers. Increasing skepticism of consumers in receiving marketers' messages. Desire of consumers to co-create the meaning of brands.

Betty's Bargain Bags sells gently used, pre-owned designer handbags. On its website it compares the manufacturer's suggested retail price (MSRP) for new designer handbags to the Betty's price for its handbags. In this example, customers' price sensitivity should be __________ as compared to situations in which customers cannot easily compare prices.

Higher. The ease at which prices can be compared heightens price sensitivity.

Sue has been shopping for a new computer, and she has diligently researched the various available brands. After evaluating the alternatives, she is considering purchasing a Dell computer. Which of the following is an example of marketing communications that Dell might use to prompt Sue in the net stage of her decision making-- the purchase decision?

In-store signage announcing a $500 rebate with the purchase of a Dell computer.

A means of orchestrating the tools of the marketing communications mix, so that audiences perceive a single, consistent, unified message whenever they have contact with a brand, is referred to as ________.

Integrated Marketing Communications (IMC)

Which of the following choices is NOT one of the reasons cost-plus pricing is so popular?

It captures the full price that customers might be willing to pay for a product.

Where on the Y&R BAV Power Grid would a product with high brand recognition but low differentiation and relevance likely reside?

Lower right quadrant/commodity or eroded brand.

Marketers may choose among various approaches to attribute accurately the role of a particular digital ad in a purchase. Identify the approach that uses existing data on consumer interactions with each ad or search along the consumer's purchasing path to estimate the effect of each interaction.

Model-based

Your manager has asked you to increase the effectiveness of your company's digital display advertising for the wallets that your firm sells with built-in RFID (radio-frequency identification) protection. She asks you to avoid sites that already cater to men's fashion because those sites are currently your primary website choice for advertising. She also warns you not to come up with any ideas that may irritate your customers or potential customers. What type of ads would you recommend to your boss?

Morphing ads

Paid placements in magazines/websites that appear directly in-line with other articles, posts, or editorial content and are formatted to look like the website/magazine content is known as ________________.

Native Advertising

Marketers use copy testing to assess the potential effectiveness of their marketing communications message. Which of the following measures comprises copy testing?

Pre- and postviewing purchase interest. In copy testing, respondents are exposed to a message in a simulated or real media environment.

One of the four forces affecting channel strategy is channel power and influence. Which of the following is NOT a source of power or influence in a distribution channel?

Premium pricing

HubSpot CEO Brian Halligan discusses inbound marketing in Video 2: Interview with HubSpot CEO Brian Halligan about Inbound Marketing 2.0 in the Core Reading. According to Halligan, digital marketers are making bad inbound marketing choices. Which of the following choices is NOT among them?

Spending more time creating content and less money on placement.

True or false: A famous influencer tweets out a picture of herself at a restaurant for which she was paid by the restaurant. This is an example of paid media.

True

True or false: Native advertising is being studied by both industry associations and US federal government regulators, who are concerned with the blurring of lines between editorial content and advertising.

True

True or false: Price customization is the primary way that many organizations improve price realization. For example, service companies such as hotels and airlines have been able to increase profitability through dynamic pricing implemented through yield-management systems.

True. Dynamic pricing refers to an approach to pricing in which the posted price varies according to the current level of market demand.

True or false: In many business-to-business (B2B) transactions, the highly technical nature of products requires a long selling cycle that in turn requires a direct channel of distribution.

True. Highly technical products require a lot of education and explanation, which is best accomplished by the supplier's own dedicated sales force. With a long selling cycle the customer will think of questions and objections that supplier's sales force is best equipped to handle.

True or false: Brand equity can be positive or negative

True. Negative brand equity causes customers to react less favorably to promotion of a product or service when the brand of that product or service is identified; positive brand equity causes customers to reach more favorably to a product or service when the brand is identified.

Horizontal channel conflict can arise for a variety of reasons. An example would be a toy manufacturer selling its toys through toy stores, discount stores, department stores, and even drugstores. Which factor cited below contributes to horizontal channel conflict?

Undifferentiated products and variable prices in the various channels

Which of the following best describes brand promise?

What a company wants a consumer to do/gain/feel by using the product.

Two of the key benefits of creating a perceptual map of a product are

a better understanding of the competitive environment and identification of points of differentiation.

Auto-play ads and pop-up ads

are typically found to be irritating by consumers.

Objectives of display ads

can be used to spur immediate actions and/or to increase brand awareness

Morphing ads

change for individuals algorithmically based on known traits for each individual as learned from his or her actions on the web. For instance, matching ads to consumers' inferred cognitive style, based on which ads the consumer chose to look at, doubled click-through rates. Morphing ads would not have to go on the web pages that the firm already uses. They are also less likely to irritate consumers, who are not always aware that the ad they're seeing is based on their past behaviors.

To manage brands effectively, marketers must understand the meaning and utility of brands for

consumers, producers, and competitors. For consumers, brands can serve as symbols that express values and identities. For producers, brands can increase consumer awareness and emotional engagement. For competitors, brands can create competitive advantages and barriers to entry.

A pull strategy is when a manufacturer

directs the promotional mix at ultimate consumers to encourage them to ask retailers for the product.

Product indicators of sensitivity to price include all of the following

easy comparability, low differentiation alternatives, and performance as expected.

To measure the effectiveness of marketing communications, marketers assess message delivery. Two common message delivery metrics that measure how much of the target market is exposed to the advertisement and the number of times they are exposed are:

effective reach and frequency

Burger King's restaurants are independently owned, yet their managers adhere strictly to the policies laid out by the brand owner. This channel structure is called a(n):

franchised distribution network

Starbucks offers a variety of types of coffee to its customers at various price points based on the quality of the coffee beans and where the coffee is grown. This is an example of:

good-better-best

elaboration likelihood model

helps explain how consumers differentially process and respond to persuasive messages and the effects these different processing paths have on their attitudes.

Quality Scores are based on all of the following factors

landing page quality, potential click-through rates, consumer relevance

Merging and milking brands are examples of

liquidating brands from a product portolio

Retargeting ads

often seen as stalking, so they too would be irritating to consumers.

A consumer's incentive to purchase is equal to:

perceived value minus price

A firm's incentive to sell is equal to:

product price - COGS

A pharmaceutical manufacturer offers monetary incentives to its sales representatives to promote a new drug to the medical professionals in their respective geographic territories. This is an example of a ________ strategy.

push

A brand consists of

the logo, brand name, symbol, and tagline and all four P's

A customer is shopping for spices in a US supermarket. She pauses as she compares the Goya brand of cinnamon to the McCormick brand. She opts for the McCormick cinnamon, judging it to be of better quality. This instinctual bias is known as

the provenance paradox

From the economic system's point of view, the role of marketing intermediaries is to ________help the company develop a direct channel selling system

transform the assortments of products made by producers into the assortments wanted by consumers

Elaboration (system 2 thinking)

triggers a central route to persuasion in which consumers invest a high level of cognitive effort to process the message.

Contextual ads

would not meet the requirement that you avoid sites that cater to men's fashion because contextual ads would place the wallet ads on such sites.