MKGT Exam 4

The Bentley Agency places $2,500 in radio spots and $17,500 in television spots for Darnell Insurance in June. For its efforts this month, the agency "traditionally" would receive ____ in compensation.

$3,000

Tim O'Brien gets the invoice for a load of gravel he purchased last week. The price of the gravel was $55, and the terms are 2/10, n/45. If Tim pays the invoice in five weeks, he will owe

$55.00.

____ provide businesses with copywriters, artists, production coordinators, media experts, researchers, and other highly skilled specialists.

Advertising agencies

Which of the following is the best example of the promotional objective of combating competitive promotional efforts?

After Ford promotes the towing capacity of its F-series trucks, DaimlerChrysler soon emphasizes the towing capacity of its Dodge trucks.

The owner of Big Bike Motorcycles is opening a new retail location. Which of the following is most likely to be a fixed cost for Big Bike Motorcycles?

Building Rent

Provisions of the Robinson-Patman Act, as well as those of the ____, limit the use of price differentials.

Clayton Act

If PepsiCo sets its twelve-pack price to match the price charged by Coca-Cola, Pepsi is using which of the following pricing methods?

Competition-based

Disney decided to run its new commercials for all of its theme parks several times a day for three weeks and then not at all for two weeks. It will then run the commercials again for three more weeks. Disney is using a ____ schedule for its advertising.

Fighting

Advertising that encourages customers to send in reply cards for additional information aids salespeople in achieving which goal of personal selling?

Finding prospects

Which of the following is an example of a trade sales promotion method?

Free merchandise

If Wrigley set its pricing objective as attaining 38 percent of the chewing gum market, what else would be needed to make this a true pricing objective?

Identification of a time period for accomplishment

Rob is working on the promotional plan for a new bicycle helmet that has added technology to sense when a bicycler has fallen and had a head injury. The technology then releases an audible signal that will help others know that there is an injury which needs treatment. This is considered to be a new product that is in the introduction stage of the product life cycle. Which type of promotion should Rob focus on?

Pioneer

When an organization uses an advertising agency, who usually develops the advertising campaign?

The firm and the agency working jointly

Rachel is considering advertising her new restaurant on the radio to attract more customers. She knows that in order to attract listeners' attention on the radio it will be important for her to

be both informal and conversational in tone.

Marketers generally view ____ as the minimum price a product can be sold for.

costs

A television advertisement for Miracle-Gro lawn fertilizer indicates that the product is available at Kmart and Walmart. This form of sales promotion is called a(n)

dealer listing.

A graph of the quantity of products marketers expect to sell at various prices if other factors remain constant is a

demand curve.

If General Motors determines that it wants to sell 200,000 Chevrolet Acadias and sets the price at $29,500 because it knows that at that price it will reach that goal, the firm would be using a ____ pricing method.

demand-based

A schedule in which advertisements run for set periods of time, alternating with periods in which no ads run is known as

flighting.

The two main reasons for criticism of promotional activities are that promotion

has some flaws, and it pervades our daily lives.

Public relations

is an element of promotion that should be handled on a continuous basis.

A product is a price leader when

it is sold at less than cost in the hope that sales of other products will increase.

Head nodding, winking, hand gestures, and arm motions are all forms of ____ communication.

kinesic

The Presto Company manufactures several types of household appliances, including blenders, waffle makers, and home deep fryers. Presto sells its products to retail stores such as Kohl's, Macy's, and J.C. Penney's, through its own salesforce. Kerry Wilson is one of Presto's salespeople, and is responsible for stores headquartered in Region 1 of the U.S. Kerry has just come from a monthly meeting where she has been informed about the new stovetop grill that will be part of next season's lineup. Presto's marketing department has developed a promotional plan for the new grill and outlined that plan for the sales staff in the meeting. The promotional plan for the next 60 days will include television commercials which demonstrate the new grill, in-store rebates, and a customer contest for the best grilled sandwich recipe. In addition, Kerry and other members of the salesforce will be given a free grill for their own home use so they can become more familiar with the product. Presto is also offering a free trip to New York City for their staff salesperson who has the highest dollar in sales to his or her stores. To encourage the retail stores to push this product, Presto will offer the retail store a $5 discount for each grill that the store purchases after the 60-day promotion is over. ​ Refer to Scenario 18.2. Kerry and the other salesforce members are best described as a ____ sales force.

missionary

Recruiting and selection of salespeople should include enough steps to yield the information needed to make accurate selection decisions. However, the stages of the process should be sequenced so that the more expensive steps are

near the end.

Justin, a sales representative for Serta Mattress manufacturers, phones Kirk of Southside Furniture to inform him that if he will increase his recent order of 15 mattress sets to 20, he will receive a 14 percent price reduction. This offer is due to a recent overstock condition at the factory and will not be available in the future. The discount offered here is

noncumulative.

Yolanda's job is to find new customers for her company's telecommunication services. She encourages existing customers to add more services and finds customers who are completely new to the company. Yolanda would best be classified as a(n)

order getter.

Dylan is a sales person for Whole Foods. In his position, he is primarily responsible for seeking repeat sales. Dylan is most likely a(n)

order taker.

If Samsung uses _____ pricing for its newest version of laptops, it is probably most interested in obtaining market share; and it is assuming

penetration pricing; that other competitors could enter the market easily.

The target audience for an advertising campaign is the

people toward whom the advertisements are directed.

Tropicana orange juice has a television commercial where a young boy is drinking orange juice at dinner. He remarks that he likes the great taste of Tropicana anytime. The element of the commercial that focuses on drinking orange juice at dinner would be best classified as ________, while the focus on the great taste of Tropicana would be best classified as ___.

pioneer advertising; competitive advertising

Advertising, personal selling, sales promotion, and public relations are called

promotion mix ingredients.

Price leaders, comparison discounting, and special-event pricing are applications of

promotional pricing.

If REVO sets the price for its sunglasses at $240, it is most likely using _____pricing to convey ______.

psychological; prestige.

When marginal cost is equal to marginal revenue, the firm should

stop producing additional units to maximize profits.

As their meeting concludes, Jamal rises and thanks Gina for taking the time to come by and explain her firm's new line of industrial fasteners. A handshake, which is best described as a form of _____ communication, concludes the session.

tactile

Ryan Amerson leads his company's clients through the installation procedure of their new industrial equipment. He also helps answer their questions about product characteristics and system design both before and after their purchases. Ryan is a

technical salesperson.

Brian and Tiffany are discussing the media plan for the opening of their new bar/laundromat called Soap and Suds. He tells her that while he agrees that ____ has tremendous impact, he does not feel that the upfront costs for such a campaign are in the modest budget that presently exists.

television

Price is a key element in the marketing mix because it relates directly to

the generation of total revenue.

A price-skimming strategy assumes that

the initial demand is highly inelastic.

At the breakeven point,

the money a company brings in from selling products equals the amount spent producing the products.

Marketers improve their ability to establish prices appropriately when

they know prices charged for competing brands.

In the long run, the J. F. Smucker Company must view ____ as the absolute lowest price for its Jif brand peanut butter.

total costs

Laura Spangler, of North Central Novelties, reduces the price of games sold to Robertson's Entertainment by 10 percent to allow for expenses associated with Robertson's promoting the games to consumers. This is an example of a ____ discount.

trade

Suppose Tommy Hilfiger is introducing a new line of men's ties. The designer believes that the target market for these ties comprises men who are very status-conscious. In keeping with this assessment, department stores selling the ties should

use price symbolically.

You are the head of marketing for a major oil company based in the United States. Recently, your company was involved in a major oil spill off the coast of Texas where millions of barrels of crude oil were accidentally released into the Gulf of Mexico. The negative publicity for your company has been fast and furious since the spill occurred. However, your company took a very proactive approach in managing the disaster and the resulting publicity. Now your CEO wants to assess how effective the company has been in repairing its image. Which of the following would you recommend to the CEO?

​A public relations audit

Which of the following statements is true about coupons?

​Coupons win back former product users.

Which of the following is true about price?

​It is the only marketing mix variable that can be changed quickly to respond to shifts in demand.

Which of the following basis for pricing is most commonly used by retailers?

​Markup pricing

Public relations materials include which of the following?

​Newsletters

You and a partner have are planning to open a dollar discount store in your hometown. You plan to sell the majority of the items in the store for one dollar unit price. You have seen this concept work well in other cities and you believe the demographics of your hometown are a good fit for this retail concept. Which of the following types of customers are you expecting to frequent your store?

​Price-conscious customers

​Which of the following statements is true about salespeople?

​They are often the knowledge experts for their firm.

The percentage of consumers in the target audience actually exposed to a particular advertisement in a stated period of time is the definition of​

​reach.

The overall role of promotion is to ________________and to build and enhance relationships with current and potential customers.

​stimulate product demand

Under Armour is establishing a ______ pricing objective to maintain or increase its product's sales in relation to total industry sales.

Market Share

If Pacific Power and Light increased its rates by 10 percent and experienced a 2 percent reduction in the demand for power, the demand would be

inelastic.

Parisian Dry Cleaners airs a series of radio ads that claim, "We are the fastest dry cleaners in town." This campaign would best be described as ____ advertising.

institutional

If FedEx decided to outsource all of its marketing efforts to the MaxPro Company, which specializes in advertising, sales promotion activities, and public relations, FedEx would likely be striving to practice

integrated marketing communications.

What a price means or what it communicates to customers is called

interpretation.

When encoding the message, the source should use signs that have

meanings that the target market will understand.

The limitations in using publicity-based public relations tools stem primarily from the fact that

media personnel control the content of the communication.

Jake is a sales representative for General Mills. Each week he uploads his plans for visiting clients out in the field to a routing and scheduling decisions system. Eric knows that one of the primary goals of routing and scheduling decisions in personal selling is to

minimize non-selling time.

Jin Xiao, a trained engineer, is a salesperson for a chemical manufacturer. He provides current customers with advice about a product's characteristics and applications. He is a(n)

missionary salesperson.

Sellers that emphasize distinctive product features to encourage brand preferences among customers are practicing

nonprice competition.

If a firm's promotional budget were extremely limited, for which of the following reasons would it be more likely to rely on personal selling as its main promotional tool?

It is easier to measure a salesperson's effects on sales than advertising's effects on sales.

Brian is responsible for the promotions and public relations of his firm, which produces rubber tires. A recent development in technology may change the way in which the rubber for tires is produced, allowing it to be sourced from the roots of dandelion plants. Brian would like to have a story run on the evening news or in the local newspaper about this development, but he knows that this story is likely to be rejected by media personnel because the material is

Not newsworthy

____ is a broad set of communication efforts used to create and maintain favorable relationships between a company and its stakeholders.

Public relations

Recently the local television station communicated a news story about the new specialized medical mart opened by Cleveland Clinic. The story provided information about the various services that the new medical mart would offer and how to get in touch with the service providers. This story is most likely an example of

Publicity.

Nate is preparing to evaluate one of his sales representatives, Julie Hill. His evaluation of her performance for the prior year led to his conclusion that she often lacked key product information at sales presentations. At their upcoming session, he will most likely do which of the following?

Recommend that she attend a training program.

Newspaper ads for Blue Haven Pools offer discounted prices during October and discounted cleaning supplies for hot tubs in March, are examples of which of the following uses of promotion?

Reducing sales fluctuations

Which of the following involves building mutually beneficial long-term associations with a customer⎯usually a business customer⎯through regular communications over prolonged periods of time?

Relationship selling

Which of the following prohibits price discrimination that lessens competition among wholesalers and retailers?

Robinson-Patman Act

Albott Laboratories offers ceramic coffee mugs to its physician customers when it promotes a new drug. This example illustrates Albott's use of which one of the following elements of the promotion mix?

Sales Promotion

The advertising department for the Pennzoil Corporation is working on a print advertisement for a new product. At this point, the layout contains a phrase to attract attention, an additional phrase to provide an explanation, an illustration to show the product, and a paragraph to explain the advantages and benefits of the product. What other important element should be included?

Signature

Which pricing objective de-emphasizes price and can lead to a climate of nonprice competition in an industry?

Status quo

Jose Suarez has been hired as sales manager at a new firm and is trying to come up with a sales force compensation method. He would like to have selling expenses relate directly to sales resources, an aggressive sales force, and minimization of non-selling tasks. What compensation method(s) would best fulfill his requirements?

Straight commission

Olivia is the manager of Human Resources for Zappos.com. She is currently reviewing the sales force compensation method used at Zappos.com to determine if there is a better way to manage compensation. Olivia knows that the ____ method is easy to administer, yields more predictable selling expenses, and provides sales managers with a large degree of control over salespeople.

Straight salary

Which of the following is particularly appropriate for pricey high-tech business products, such as jet aircraft and medical equipment?

Team selling

Which of the following is true about the target market's evaluation of price?

The importance of price depends on the type of product.

At what point does a firm maximize profit?

The point at which marginal cost equals marginal revenue

Companies tend to view promotion from many vantage points. Which of the following alternatives is most accurate?

The role of promotion is to stimulate product demand.

What type of discount is given to a business purchaser for performing activities such as transporting, storing, and selling?

Trade

The Palasi Candy Company is a small business located in the northeastern United States. The owner of Palasi Candy is calculating the projected costs for the coming year. There is rent for the building, salaries for the retail employees, raw materials of sugar, chocolate, and other ingredients, wrappers for packaging of individual pieces of candy, boxes, and radio advertising. Palasi's ______ are most likely to be the raw materials of sugar, chocolate, and other ingredients, as well as the wrappers.

Variable costs

Which of the following are personal informal exchanges of communication that customers share with one another about products, brands, and companies?

Word-of-mouth communication

Advertising agencies typically receive

a 15 percent commission paid by the media from which it makes purchases.

A dealer loader is

a gift to a retailer who purchases a specified quantity of merchandise.

When Levi's agrees to pay JC Penney's money for providing television advertising and Sunday newspaper sales fliers emphasizing Levi's jeans, Levi's is offering

a merchandise allowance.

Odd-even pricing is

a psychological pricing strategy.

Ralph Lauren is planning a promotion where it will showcase all of its clothing lines to buyers at retail stores. It also plans to develop a direct marketing campaign that will use social media to introduce its new seasonal styles. Ralph Lauren is using ___ with the retail showcase and ___ with the social media campaign.

a push policy; a pull policy.

One of the biggest problems associated with ____ as an element of promotion is the high absolute dollar outlay often required.

advertising

The total amount of money a marketer allocates for advertising for a specific time period is the

advertising appropriation.

Threatt Production makes low-priced, convenience products that are widely available. It is most likely to focus its promotion efforts on

advertising.

When a company promotes its position on a public issue, this is specifically referred to as ____ advertising.

advocacy

An advertising campaign is typically developed by an individual or a few persons within the firm, an advertising department within the organization, or

an advertising agency.

Hannah is a retail salesperson for Crate and Barrel in Chicago. She is most likely classified as

an inside order taker.

Effective motivation of a sales force is best achieved through

an organized set of activities performed continuously.

Creating a favorable impression and developing rapport with prospective customers is a critical part of the ____ step of personal selling.

approach

If Roberts Electronics finds that the average total cost of its radar detectors and the marginal cost of its radar detectors are both $85, then

average total cost is at its lowest level.

The BASF Chemical Company in Germany has developed a new rubberized coating. The product has an application for cell phones and other hand-held electronic devices that gives them protection from falls and scratches. BASF plans to market the product directly to businesses that manufacture the casings for these types of products. BASF currently uses a system of salespeople headquartered in Germany, while its primary business customers are in China. ​ Refer to Scenario 19.2. If BASF were to employ pricing that includes the price at the factory plus freight charges from a chosen point nearest the buyer, this would be an example of ____ pricing.

base-point

Glenwood Pet Hospital is considering implementing a new pricing strategy for its veterinarian services. After reviewing the previous three years' revenue, Glenwood finds that most of its customers bring their pets in for the required annual vaccinations and then only if the animal is ill. Glenwood's objective is to generate more income per customer on an annual basis. The hospital has previously priced its services by charging a flat fee for the office visit, a fee for each vaccine, and a fee for each type of examination beyond the basic office visit. Most customers pay the flat office fee and a fee for a rabies vaccine. Glenwood is now considering a new plan where the pet owner would pay one fee that would cover an office visit, the required rabies vaccine, and additional vaccines that prevent heartworm, kennel-cough, and fleas. Glenwood hopes to encourage the pet owners to view their pet's health as part of a prevention program, rather than a one-time annual visit. ​ Refer to Scenario 20.2. Glenwood's new pricing strategy is an example of ____ pricing.

bundle

When Mia and Shane are planning their honeymoon, their travel agent tells them that if they buy a special package, their trip to Paris will include meals, tickets to the theater, and a rental car in addition to airfare and a hotel. This is an example of the use of

bundle pricing.

An attempt to create a trend or acceptance of a product through word-of-mouth communication is called

buzz marketing.

Maintaining or increasing market share

can be achieved even if industry sales are flat or decreasing.

A major benefit of using event sponsorship is that it

can provide large amounts of free media coverage.

Promotion tends to

capitalize on existing needs.

Each communication channel has a limit on the volume of information it can handle effectively. This limit is called

channel capacity.

For many consumers, the pages near the back of magazines with dozens of very small black and white advertisements exceed their

channel capacity.

Radio and television signals as well as ink on the paper of a magazine or newspaper are all considered

communication channels.

A sharing of meaning defines

communication.

Coors advertises that its beer is the only one that is kept cold from the brewery to the store. This type of advertising is called

competitive.

Heinz uses various techniques such as coupons, free samples, and consumer contests to encourage consumers to try its products. All of these marketing activities are considered

consumer sales promotion methods.

The difference between consumer sales promotion methods and trade sales promotion methods is

consumer sales promotions focus on getting consumers to buy their products, whereas trade sales promotions focus on getting wholesalers and retailers to buy.

Often when a company introduces a new product or line extension, its promotion will focus on ____ in order to initiate the product-adoption process.

creating awareness

The BASF Chemical Company in Germany has developed a new rubberized coating. The product has an application for cell phones and other hand-held electronic devices that gives them protection from falls and scratches. BASF plans to market the product directly to businesses that manufacture the casings for these types of products. BASF currently uses a system of salespeople headquartered in Germany, while its primary business customers are in China. ​ Refer to Scenario 19.2. BASF has decided to offer discounts to its businesses customers in the form of the following: For each order of $100,000 or more during the next 90 days, the buyer will receive a rebate of 5 percent. This type of pricing would be an example of ____ discounts.

cumulative

A deduction from list price for purchasing large quantities aggregated over a stated period of time is a

cumulative quantity discount.

Order-getting activities are divided into two categories:

current-customer sales and new-business sales.

When better market conditions prevail or when company growth occurs, a company may suffer if it

cut back the size of its sales force.

During July and August, Lakewood Links Golf Course, located in South Carolina, offers weekday rates of $13 for a round of golf with a cart. During the rest of the year, the weekday rates are between $25 and $35. This is an example of the use of

demand-based pricing.

After the advertising budget is determined, the next step in creating an advertising campaign is

developing the media plan.

The fact that senior citizens are charged a lower price at movie theaters than younger adults is an example of ____ pricing.

differential

A firm can identify changes in public opinion that affect it by conducting

environmental monitoring.

The last stage in the development of any advertising campaign is

evaluating the effectiveness of advertising.

When Hamburger Helper introduced its Oven Varieties, it gave special offers to supermarkets to purchase the new product and supplemented these offers with consumer advertising. Hamburger Helper's primary objective is to

facilitate reseller support.

A sales representative for Coca-Cola travels to various restaurants to determine how much syrup the customer needs for the coming period. This sales representative would be classified as a(n)

field order taker.

Doug travels around to various established customers to see what new office supplies they need. His customers have come to depend on him to check their supplies. Doug is a(n)

field order taker.

In recent years the proportion of promotional dollars spent on sales promotion has

increased relative to advertising.

Glenwood Pet Hospital is considering implementing a new pricing strategy for its veterinarian services. After reviewing the previous three years' revenue, Glenwood finds that most of its customers bring their pets in for the required annual vaccinations and then only if the animal is ill. Glenwood's objective is to generate more income per customer on an annual basis. The hospital has previously priced its services by charging a flat fee for the office visit, a fee for each vaccine, and a fee for each type of examination beyond the basic office visit. Most customers pay the flat office fee and a fee for a rabies vaccine. Glenwood is now considering a new plan where the pet owner would pay one fee that would cover an office visit, the required rabies vaccine, and additional vaccines that prevent heartworm, kennel-cough, and fleas. Glenwood hopes to encourage the pet owners to view their pet's health as part of a prevention program, rather than a one-time annual visit. ​ Refer to Scenario 20.2. Glenwood's closest competitor, The Hearthstone Pet Hospital, currently charges $60 for each basic office visit. If Glenwood were to price its basic office visit at $45, it would most likely be employing which of the following?

penetration pricing.

Before contacting prospects, a salesperson for an industrial cleaning equipment company analyzes information about the prospects' product needs, feelings about brands, and personal characteristics. This process is called

preapproach.

Breyer's produces a variety of ice cream flavors and lines of varying qualities. The higher quality ice cream varieties are priced higher than the basic ones. Breyer's is using ____ to price its ice cream.

premium pricing

To increase sales of Chex cereals, Ralston Purina offered a free pound of bananas to customers who bought the large-size box. This form of sales promotion is called a

premium.

French Quarter Inns drops the price of a suite from $225 to $195 per night and experiences a reduction in the quantity of rooms demanded of an average of five per night. This is an indication that suites at this hotel are apparently an example of a(n) ____ product.

prestige

Buyers who focus on purchasing products that signify prominence and status are

prestige-sensitive buyers.

General Mills used a panel of consumers to evaluate its Cheerios campaign featuring children who read the cereal box and try to persuade their parents to watch their cholesterol. These consumers judged the advertisements prior to the execution of the advertising campaign. This is an example of a(n)

pretest.

A measure of sensitivity of demand in relation to changes in price is

price elasticity of demand.

If Norelco introduced a new electric razor that sonically removes hair and priced it first at $175 and then at $150 before reducing the price to $100, the firm's initial pricing strategy is known as

price skimming.

Advertisements for Suave shampoos emphasize that other shampoos may cost more but don't work any better than Suave. In this example, Suave is competing on the basis of

product price.

Westin Hotels, Inc. has an objective of achieving a 25 percent return from its overall sales. This is an example of a ____ pricing objective.

profit

If the push policy is used in promoting a product, the firm

promotes only to the next marketing institution down the marketing channel.

Kendra has been doing research for a smartphone manufacturing company. She has just been reviewing the results of several focus groups and has found that for customers, value is a function of the product's

quality attributes.

A marketer is most likely to set prices according to a cash-flow objective when a

quick return on investment is desired.

If a business decides to reduce its prices once in a while on an unsystematic basis, it is using

random discounting.

The primary goal of a media planner is to

reach the largest number of people in the target market within the budget constraints.

An advertisement from a ski lodge extolling the benefits of a summer getaway in the mountains uses promotion to

reduce sales fluctuations.

An ad for a multivitamin that claims, "We still bring you everything you need to get through your day in one vitamin," would most likely be considered ____ advertising.

reminder

Use the following to answer the questions. ​ The manufacturers of Whizz, a new laundry detergent, are developing their promotional plan for the first year. They know they want to use an integrated communications strategy and are considering the use of advertising through TV and magazines, coupons, public relations, sales promotion, and viral marketing. They are not sure when to use each of these methods however, and have asked for your advice. ​ Refer to Scenario 16.2. If the manufacturers of Whizz were to partner with Whirlpool to place a bottle of Whizz in each new washer that is purchased during the first year, this would be an example of

sales promotion.

When a marketer makes an effort in promotion to point out the strengths and benefits of a specific brand, it is an attempt to build ____ demand.

selective

When individuals' behaviors are tracked from television sets to checkout counters using equipment provided by the marketer, this is known as

single-source data.