MKT 300 Exam 3

For what main reason is personal selling the single biggest promotion expense in many firms? a. Personal selling depends on direct contact with customers, which is costly as well as time consuming. b. The new technologies of personal selling require big investments in software. c. Advertising has become cheaper than personal selling over time. d. Personal selling is only effective as a follow-up to expensive advertising.

Personal selling depends on direct contact with customers, which is costly as well as time consuming.

A new boss just took over the marketing department where you work for a women's swimwear manufacturer. You hope to impress him or her with your knowledge of an important topic in your industry: How prices affect consumer perceptions of quality. You should make all of the following points except: a. Perceptions of quality may be affected by the eco-friendliness of a product. b. Supply and demand play no role in purchasing patterns when perceptions of quality are driven by price. c. It is common for consumers to define both upper and lower limits within which their quality perceptions vary. d. Perceptions of quality may be affected by both high and low prices.

Supply and demand play no role in purchasing patterns when perceptions of quality are driven by price.

You work for a local politician who has allegedly been linked to a local scandal. As the head of the politician's communications team, you are strategizing ways to address this issue, especially since it is an election year, and he or she wants to run for national office. You think that the best approach in addressing this problem is employing media marketing, but you still have to figure out which medium is best. You want to use a medium that is credible, flexible, and reaches wide audiences. You are not particularly concerned about cost because you believe that the expense is worth it. Which of the following media can best help you accomplish your goal? a. Newspaper b. Magazines c. Television d. Radio e. Billboards

Television

You have a colleague who swears by using breakeven analyses. He or she has not been on the job long enough to be able to understand the reasons why this tool isn't always reliable. Which of the following reasons should you share with him or her? a. Breakeven analysis is outdated. b. Breakeven analysis is hard to calculate; and it is difficult to explain how the results are derived. c. The company's accounting system does not clearly distinguish between fixed and variable costs. d. Not everyone in the company understands or uses breakeven analyses.

The company's accounting system does not clearly distinguish between fixed and variable costs.

Your uncle is a highly successful Ford dealer. Unlike some other dealers, he trains his salespeople to strongly encourage prospects to test drive his cars. In terms of the AIDA concept, your uncle emphasizes: a. initiating action b. securing attention and interest c. handling objections d. generating interest and desire

generating interest and desire

When the price of Product A is raised by 1 percent, its sales drop by 0.06 percent. When the price of Product B is raised by 1 percent, its sales drop by 1.5 percent. This means that demand for Product A is _______, while demand for Product B is ________. a. inelastic, elastic b. elastic, inelastic c. unelastic, inelastic d. elastic, partially elastic e. partially elastic, inelastic

inelastic, elastic

You are contemplating adding direct selling activities to your existing bricks-and-mortar retail business to increase sales. You are concerned, however, that the negative aspects of direct selling outweigh the positive. Which of the following is a negative aspect of direct selling that you must mitigate in some way to be successful? a. Products are presented at convenient locations for customers. b. It may be more expensive and time-consuming than using an intermediary. c. Customers get personal attention. d. Direct selling is a less expensive form of retailing. e. Products are presented at convenient times for customers.

it may be more expensive and time-consuming than using an intermediary.

To forecast sales for your firm's new product, you want to use a forecasting technique that is based solely on input from sources internal to the firm. Which of the following groups of techniques meets your criterion? a. survey of buyer intentions, sales force composite, and trend analysis b. jury of executive opinion, sales force composite, and trend analysis c. test markets, survey of buyer intentions, and sales force composite d. Delphi technique, jury of executive opinion, and test markets

jury of executive opinion, sales force composite, and trend analysis

After working in retail for about a decade, Lynette decided to open her own shop. For years, she had been interested in learning about handbags and collected vintage purses. Naturally, Lynette was going to open a handbag shop. Because she knows just how expensive designer bags could be, she also decided to find ways to cut the costs associated with running a store so she could increase customer bargains. Lynette's store is open five days a week from 12 noon to 6 p.m. Which of the following types of retailers accurately reflect Lynette's store? a. Department store b. Chain store c. Convenience retailer d. Mass merchandiser e. Specialty store

specialty store

As a restaurant marketer, you are responsible for setting prices on each menu item. Your new appetizer is a fruit-and-nut salad, with a total ingredient cost of $5. The industry's standard markup is 25 percent. What should you charge for this appetizer? a. $6.00 b. $5.75 c. $5.25 d. $6.25 e. $6.50

$6.25

Your temporary placement service needs to place personal selling personnel who use different communication channels according to the products they are contracted to sell. You presently have several positions to fill that require personnel experienced in various communication channels. You want to categorize the type of experience needed before you start calling your employees. Choose the statement that inaccurately categorizes its job description to the type of personal selling communication channel it utilizes. a. An insurance company needs sales representatives to place phone calls to prospective clients to sell renters' insurance over the phone. These sales representatives will use telemarketing. b. A retail outlet needs someone to sell auto repair supplies and parts to businesses and directly to customers. This outlet uses over-the-counter selling. c. Sales representatives are needed to support technicians and purchasers on a continuous basis by phone, mail, and e-mail. They will utilize inside selling. d. A soft drink distributor needs bilingual representatives to take product orders when customers call. This involves field selling.

A soft drink distributor needs bilingual representatives to take product orders when customers call. This involves field selling.

You have noticed that the most profitable diners at your restaurant are repeat customers, so you've developed a program to reward their loyalty. On every fifth visit, they will receive a free dessert and specialty coffee. Which of the following statements about this reward program is accurate? a. Its promotional objective is to create awareness of your restaurant. b. Advertising could not be used to further the same promotional objective. c. Advertising could be used to further the same promotional objective. d. It is likely to stimulate primary demand.

Advertising could be used to further the same promotional objective.

A customer comes into your rental/retail outlet because he or she wants to purchase a 26-ton hydraulic log splitter. You have some models available for daily rental but they are not the latest model that your customer is looking for. There is a 26-ton model on the floor, but it would be most beneficial to show him or her firsthand the difference between your product and other cheaper models that are on the market. What demonstration options can you consider for your customer? Select the viable demonstration option. a. Describe the splitter's major features and give the customer printed specs to take home with him or her. b. Let the customer know that there is no delivery charge on the log splitter. c. Allow the customer to rent a comparable unit for a day and waive the rental fee upon the return of the splitter on time and in good condition. d. Tell the customer about your in-house financing option, whereby he or she can complete payment in six months with no interest.

Allow the customer to rent a comparable unit for a day and waive the rental fee upon the return of the splitter on time and in good condition.

Janice works as a consultant for a tech company. In the past, the company has relied heavily on its toll-free line to sell new products, as well as its numerous distribution channels. When customers are polled via a customer satisfaction survey, 93 percent of them report that one of the primary reasons they have continued to support the company is because of its quality customer service. Janice has been asked to brainstorm strategies to increase company sales. She suggests that the company employs automatic merchandising to cut costs and boost profits. Why might automatic merchandising be a bad idea for this company? a. It is difficult to develop effective marketing strategies for automatic merchandising. b. Automatic merchandising sales are impersonal. c. Distribution for automatic merchandising is limited. d. It is too costly to maintain automatic merchandising around the clock. e. Automatic merchandising is archaic.

Automatic merchandising sales are impersonal.

Company A and Company B both raised their prices by 30 percent. While A enjoyed a substantial increase in profits, B's profits plunged downward. Based on this information, which of the following is the most likely explanation for the companies' different outcomes? a. A's product offers better value than B's. b. A has more customers than B. c. A's product is higher quality than B's. d. B's customers are more price sensitive than A's customers. e. A has a history of high prices, while B has only charged low prices.

B's customers are more price sensitive than A's customers.

Public relations refers to a firm's communications and relationships with its various publics, including customers, suppliers, the government, employees, and stakeholders. The publicity that a company garners involves unpaid placement of significant news about the company in a published medium or through favorable presentations on the radio, Internet, or television. Why are consumers more likely to believe information that stems from the marketing aspect of public relations than they are to believe claims in advertising? a. Because many consumers consider news more credible when it comes from a media organization than when it comes directly from a marketer. b. Because many consumers appreciate when news comes directly from marketers instead of being filtered through a media organization. c. Because this information tends to be nonelectronic. d. Because published information typically reflects bad news about companies, products, executives, and ideas.

Because many consumers consider news more credible when it comes from a media organization than when it comes directly from a marketer.

You planned to use trend analysis to forecast sales of the new yogurt being introduced by your dairy products firm. However, the marketing director just informed you that trend analysis is inappropriate for this purpose. Assuming he or she is correct, what is his or her most likely reason? a. Because the product is new, historical data is too expensive to obtain. b. Trend analysis cannot be applied to the dairy products market. c. Because the product is new, historical data is not available. d. Trend analysis is an outdated forecasting technique.

Because the product is new, historical data is not available.

You are a sales manager for a luxury automobile dealership where you have been employed since graduating from college. Your neighbor, who teaches a community college course on marketing, has asked you to make a presentation to his or her class as a guest speaker. After your lively presentation, you ask the students what they think is the main focus of personal selling. Which of the student answers below demonstrates an understanding of the goals of this promotional tool relative to others? a. Providing entry-level jobs to college graduates who will move on to other marketing jobs. b. Building relationships with customers that encourage them to come back. c. Making a profit for the company. d. Being the face of the company's brand.

Building relationships with customers that encourage them to come back.

You work for a weight loss company that is advertising a new weight loss smoothie. Here is a transcript of the first commercial to be aired on a local food network channel: "Do you have tenor more pounds of excess weight to shed? If so, you should be drinking Blast Berry before every meal! Blast Berry is a weight-loss supplement, and the first of its kind to be approved by the Food and Drug Administration. In a random controlled study, 75 percent of the research participants who used Blast Berry along with exercise dropped an average of 23 pounds within two months of following the program. Blast Berry costs $19.99 for a month's supply and works for those who stick to the plan. Drink one serving before each of the three major meals of the day, and see the weight come off!" Which of the following basic tasks of effective messaging does this message fail to accomplish? a. Gaining the receiver's attention b. Stimulating the receiver's needs and suggesting an appropriate way to satisfy those needs c. Communicating competitive advantage and positioning d. Achieving understanding by both the receiver and sender

Communicating competitive advantage and positioning

You work for a food-processing plant that manufactures corn tortillas. You have been asked to review the activities of upstream management to determine if costs can be cut in that area. Which activities listed below will be your concern? a. Contacting the farming cooperative to negotiate the price of corn for your upcoming contract. b. Investigating the possibility of diversifying into producing not only corn tortillas but flour tortillas as well. c. Checking the feasibility of raising the price at which corn tortillas are sold to your business customers. d. Decreasing the cost resulting from returns due to improper handling and packaging of corn tortillas.

Contacting the farming cooperative to negotiate the price of corn for your upcoming contract.

In 2014, the Golden Gate Bridge toll fee rose from $6 to $7. Beginning in 2015, the toll fee will go up by a quarter for each of the next four years. Administrators explained that fees were not keeping up with inflation because "toll revenues have remained flat." What situation are administrators counting on? Choose the correct answer. a. Crossing the bridge will remain an elastic demand. b. Crossing the bridge will change to an inelastic demand. c. Crossing the bridge will change to an elastic demand. d. Crossing the bridge will remain an inelastic demand.

Crossing the bridge will remain an inelastic demand.

The seven steps in the personal selling process should be aligned with the AIDA concept, which describes the consumer's buying decision process. Which of the following steps is misaligned with this concept? a. The demonstration step generates interest and desire. b. Getting a prospect's attention is the goal of handling objections. c. The closing of a sale brings action. d. The presentation step generates interest and desire.

Getting a prospect's attention is the goal of handling objections.

Sal is currently in the market for a new car. He considers various factors before making his purchase; for example, he considers gas mileage, power-train warranty, safety records, status, price, and convenience. He then makes a final list of six possible vehicles to purchase. However, after thinking about all these things, he dismisses them and decides instead to purchase the highest price vehicle. Based on this information, what is the most likely reason for Sal's decision? a. The list of important features to consider was too long and therefore there were too many comparisons to make easily. b. The highest price vehicle was more effectively promoted than the alternatives. c. He assumed that the highest price car must also be the most prestigious and he would like to project a high-status image. d. He neglected to set prices limits before making his decision.

He assumed that the highest price car must also be the most prestigious and he would like to project a high-status image.

You are one member of the marketing team for a wine distributor who sells exclusively through your own chain of high-volume shops. Your team wants to explore other available marketing channels, including sales over the Internet and product placement in specialty retailers. In order to come to a consensus, you want to outline some basic questions regarding distribution channels and present them to the team for discussion. The discussion should include all of the following questions except which one? a. Will selling at other retail outlets diminish control over marketing the product? b. How many intermediaries are necessary for adequate market coverage? c. What restrictions exist for shipping to communities that ban the sale of alcohol? d. How will exploring new distribution channels affect relationships with current intermediaries?

How will exploring new distribution channels affect relationships with current intermediaries?

Integrated marketing communication (IMC) requires a big-picture view of promotional planning; a total strategy that includes all marketing messages. You work for a multinational beverage company headquartered in Singapore. You have been put in charge of developing comprehensive marketing communication packages and want to ensure that you maximize the benefits for your company. To reach this goal, you work with department heads around the world to ensure that marketing and communications objectives support the corporate mission and strategies, and keep all staff informed about new developments. You also work with external partners, including advertising and PR agencies, to achieve a cohesive message for your brand and products. Which of the following statements is most likely to be true about your IMC effort? a. IMC challenges the notion that your advertising, personal selling, direct marketing, and other components of the worldwide promotion mix must stand alone. b. Developing multinational integrated marketing communication is likely to contribute to the duplication of communication efforts. c. Sending a unified positive message about your company is often not a priority. d. Your target market will be identified after the company has established an IMC strategy.

IMC challenges the notion that your advertising, personal selling, direct marketing, and other components of the worldwide promotion mix must stand alone.

Marketers are concerned with distribution intensity, which is how many intermediaries will distribute the goods in a particular market. Select the description of the general categories of market coverage that is incorrect. a. In controlled distribution, the manufacturer is forced by law to sell its own products. b. In intensive distribution, items with wide appeal are distributed through as many channels as are available in a trade area. c. In selective distribution, the manufacturer will often provide training and assistance to the limited number of dealers it chooses to distribute its product. d. In exclusive distribution, a single wholesaler or retailer is granted the right to sell a product in a given area.

In controlled distribution, the manufacturer is forced by law to sell its own products.

For the last ten years, you have been the leading sales representative in your firm. Most of the other sales reps are in awe of you because they say you make personal selling look so easy. You know better, however, because it has not always been easy nor have you always been so successful. You have learned over the years that there are some key rules of personal selling that must be followed consistently for success. One of the rookie sales reps just asked you for some tips on success in personal selling. You told him or her to give you a list of his or her thoughts on what it takes to be successful in personal selling and you will start the discussion there. Select the true statement made by the rookie sales rep about successful personal selling tactics and approaches. a. All this talk about pre-call planning is misguided. It's pointless to spend much time on it because it doesn't contribute much to sales success. b. It's impossible to anticipate a prospect's objections, so you should expect to address them on the fly. c. It's important to make sales presentations relevant and meaningful for the prospect. d. Instead of wasting time trying to get referrals, you should work on becoming a cold calling expert.

It's important to make sales presentations relevant and meaningful for the prospect.

Which of the following statements about cross-promotion is inaccurate? a. It may utilize a mix of promotional tools. b. The partners share promotional costs. c. Its effectiveness is limited to complementary products. d. Its importance in the marketing world is likely to increase over time.

Its effectiveness is limited to complementary products.

According to the Ad Age article "PennWell acquires Oil & Gas Pipeline Conference" (March 21, 2013), "The pipeline and transportation sectors of the industry are experiencing phenomenal growth due to the resurgence of exploration and drilling in North America" (retrieved from http://adage.com/article/btob/pennwell-acquires-oil-gas-pipeline-conference/288678/). Pipelines rank third after railroads and motor carriers in ton-miles transported, but most people do not recognize pipelines as a major mode of transportation. Nevertheless, pipelines are the preferred method used for transporting crude oil, diesel fuel, kerosene, and gasoline in the United States. What are some drawbacks to transporting via pipeline? a. Pipelines can only carry liquids. b. Pipelines move products quickly through a long network. c. Pipelines cannot be carried across the entire United States. d. Pipelines are undependable methods of transportation over time.

Pipelines can only carry liquids

According to the Ad Age article "PennWell acquires Oil & Gas Pipeline Conference" (March 21, 2013), "The pipeline and transportation sectors of the industry are experiencing phenomenal growth due to the resurgence of exploration and drilling in North America" (retrieved from http://adage.com/article/btob/pennwell-acquires-oil-gas-pipeline-conference/288678/). Pipelines rank third after railroads and motor carriers in ton-miles transported, but most people do not recognize pipelines as a major mode of transportation. Nevertheless, pipelines are the preferred method used for transporting crude oil, diesel fuel, kerosene, and gasoline in the United States. Why are pipelines an advantageous method of transport? a. Pipelines provide jobs for consumers because of the resurgence of exploration and drilling in North America. b. Pipelines are versatile, carrying more ton-miles than any other mode of transport over more than 2 million miles of pipeline. c. Pipelines have more locations than water carriers. d. Pipelines offer low maintenance and dependable transportation for a narrow but important range of products.

Pipelines offer low maintenance and dependable transportation for a narrow but important range of products.

A retailer is facing difficult times: Sales are down and there has been a decrease in the number of customers visiting the store. The retailer decides to lower the prices on a few items, hoping this strategy will draw more customers who will not only purchase the discounted items but will also linger in the store and buy additional items. Which type of pricing policy is the retailer using? a. Price flexibility b. Product line pricing c. Psychological pricing d. Promotional pricing

Promotional pricing

Unlike wholesalers and manufacturers, retailers represent the distribution channel to most consumers. Which of the following is not a reason for this consumer perception? a. Retailers have little contact with wholesalers and manufacturers. b. Consumers have little contact with wholesalers and manufacturers. c. Consumers rely on retailers to obtain a wide array of merchandise. d. Retailers determine merchandise selections. e. Retailers determine shopping hours and locations.

Retailers have little contact with wholesalers and manufacturers

Luca's company is a manufacturer of desk calendars and other office supplies. In the past, he has sold only through his own website; however, as his business has grown, he has decided to add a retail partner. Which of the following is not among the questions Luca should ask when he chooses a partner? a. Which retailers offer the most appropriate atmospherics for selling office supplies? b. Which retailers attract buyers for home and commercial offices? c. Should his products be sold in an office supply specialty store? d. Should his products be sold via direct mail that provides tips about how to run an office?

Should his products be sold via direct mail that provides tips about how to run an office?

You work for a multinational food corporation that specializes in breakfast foods. For the last ten years, your breakfast bars have dominated the market and been found on the tables of 65 percent of the families in the United States. In the last three quarters, however, your product has not been performing as well; you think the younger generation of parents perceives your bars, incorrectly, as high in sugar and fat and is unaware of their healthy ingredients. Your company develops a series of buy-one-get-one-free promotions and arranges for retailers to hand out samples at their stores. Despite all the resources you invest in this promotional campaign, the product's performance does not improve over time. Why is the approach to marketing described in the scenario ineffective? a. The company's promotional objective was inappropriate given its marketing needs. b. The company chose the wrong target market. c. The prices for the product were too high for young families. d. The goals for the promotional campaign were too broad.

The company's promotional objective was inappropriate given its marketing needs.

Company X is enjoying a spurt in sales of the stuffed animals it manufactures. To meet demand, the firm is spending more than ever before on cotton stuffing. However, its marketers note that they are spending less for stuffing per toy than in the past. Based on this information, what is the most likely explanation for the difference between overall spending and per-toy spending? a. Competition has increased. b. Competition has decreased. c. The factory is operating less efficiently. d. The firm is importing cotton stuffing from abroad. e. The factory is operating more efficiently.

The factory is operating more efficiently.

As a member of the marketing team for a manufacturing company, you need to be familiar with methods that are available to your company to facilitate communication about and movement of your products and goods. Your company is facing some logistics and supply chain challenges and you have been asked to help find solutions for them. Choose the statement that does not accurately identify the best management approach to deal with each management challenge. a. The business is growing so quickly that your company needs to reduce the human effort and error involved in tracking inventory and assets. Radio Frequency Identification (RFID) is the best approach. b. Your company wants to improve and streamline transportation and warehousing functions, but does not yet possess the specialized knowledge and expertise needed to do that. It should consider outsourcing some of these functions to a specialist firm. c. The manufacturing company for which you work wants to consolidate the data from among all the firm's business units. RFID is the best approach. d. The manufacturing company for which you work wants to consolidate the data from among all the firm's business units. An Enterprise Resource Planning (ERP) system is the best approach.

The manufacturing company for which you work wants to consolidate the data from among all the firm's business units. RFID is the best approach.

You work for an organization that wants to use a celebrity spokesperson to advertise its new smoking cessation programs. The company enlists the support of a local music celebrity who is well known and well liked. The celebrity has previously endorsed a local restaurant, is supporting the campaign of a local politician, and is known to partner with a local music program that works with blind children. This celebrity also is known to support awareness for lung cancer initiatives because his or her brother was a pack-a-day smoker for three decades and died of Stage IV lung cancer. Which of the following might be a drawback of working with this particular celebrity on promoting your organization's cause? a. The celebrity is not a credible source of information. b. There is marketplace confusion surrounding this celebrity. c. The celebrity's body of professional work is not impressive. d. This celebrity spokesperson is expensive and probably behaves badly.

There is marketplace confusion surrounding this celebrity.

The Ash brothers operate an online retailer that specializes in herbal teas from remote villages across the globe. A direct-response retailer, the Ash brothers' company allows customers to purchase their teas by phone, mail, or via the company's website, and then they ship the order directly to the client. The Ash brothers serve as an intermediary between product manufacturers and customers. Which of the following is an advantage that the Ash brothers have in running this online direct-response retailer? a. They are able to reach a wide base of customers and special niche markets because of the Internet. b. They generate a large number of inquiries from customers making purchase decisions. c. They sell the teas to customers at prices that are marked down. d. Most of their purchase orders come directly through the company's website. e. They completely bypass retailers and wholesalers.

They are able to reach a wide base of customers and special niche markets because of the Internet.

You are the marketing manager of a small start-up retail company. You are aware that your company's pricing strategies are an important way to communicate your firm's image to consumers. You also realize that as a start-up your company must make every effort to attract customers. After thoroughly analyzing your competitors' offerings, you decide to set the prices of your company's merchandise at odd, unusual numbers slightly below a round number. For example, instead of pricing an item at $10.00 you price it at $9.95. What is the most likely reason to employ this odd pricing strategy? a. This allows the retailer to emphasize important characteristics that differentiate product lines at different price points. b. Odd-numbered pricing adds to the perceived prestige of the company on the part of consumers. c. This makes the price seem like $9.00 plus change rather than a full $10.00. d. This allows the retailer to inconspicuously change the prices at any time.

This makes the price seem like $9.00 plus change rather than a full $10.00.

You work for a young grassroots art organization that does not have a lot of funds to invest in marketing efforts but wants to create a name for the company. As a muralist, you have considerable experience beautifying schoolyards and alleys with your paintings, and suggest to your executives that you use graffiti to spread the company's name in certain neighborhoods. Because your company specializes in art, you think this would be the perfect way to market the company and its long-term social mission to fill abandoned park walls with community art and develop community gardens. Your company agrees with the idea, so you partner with other muralists and paint the company's logo in creative ways on abandoned city walls. At first, your company receives bad publicity for the stunt, but it generates a lot of inquiries about your artwork because potential customers are intrigued by your company's level of creativity and innovation. Which of the following statements is true about the scenario described above? a. Guerilla marketing enhanced the credibility of the organization and increased its sales. b. This marketing strategy is usually effective because competitors are less likely to be using the same approach. c. Buzz marketing like the type described in the scenario is a cheap way to promote a company, but it is usually ineffective because it can offend some people. d. This form of advertising is likely to cost about the same as more traditional advertising.

This marketing strategy is usually effective because competitors are less likely to be using the same approach.

A banana supplier sells to both supermarket chains and independent food stores in the same region. The supermarket chains always generate more revenue than the independent food stores, because the supermarket chains order bananas more frequently and in bigger volume. To increase his or her profits from the independent food stores, the supplier wants to charge them more per bushel than he or she charges the chains. However, the supplier's director of marketing advises against it. Which of the following is the most likely reason for this advice? a. This pricing policy could cause a price war. b. This pricing policy must be approved by the Federal Trade Commission. c. This pricing policy might violate the Robinson-Patman Act. d. This pricing policy might violate unfair trade laws.

This pricing policy might violate the Robinson-Patman Act.

Read the following excerpt from the article, "Lines separating sales channels blur: Manufacturers, direct sellers, retailers, invade each other's turf" by Tom Collinger in Ad Age (March 30, 1998) and then choose the best answer to the question posed below. Conflict in the channels has produced a total blurring of the lines that once separated them. First, there's the blur between manufacturers and retailers. Then, there's the explosion of discount outlet malls, which proudly expose the highest image-oriented brand names to the consumer—direct from the manufacturers.... In addition, because of the proliferation of these malls as legitimate channels, sales for the brands in this channel are in the multimillion-dollar range. Finally, there is the manufacturer and direct-seller blur caused by those manufacturers that recognize the need to gain back some of the control they have lost to retailers.... Some manufacturers have mined niches in the market where they believe direct selling is somehow less objectionable to their retail partners.... Access to the consumer through the Internet will only continue to blur the manufacturer/direct-seller lines, altering the fundamental selling proposition for manufacturers forever (retrieved from http://adage.com/article/news/lines-separating-sales-channels-blur-manufacturers-direct-sellers-retailers-invade-s-turf/66410/). What type of marketing channel conflict is being discussed in the above excerpt? a. Channel cooperation b. Vertical conflict c. Horizontal conflict d. Strategic conflict

Vertical conflict

You work in the marketing department of a household cleaning products manufacturer. When the CEO found that online purchase of consumer-packaged goods had reached only 1 percent of the $666 billion in sales in 2013, he or she charged your team with devising a plan to change that picture. Your research has shown that home delivery of cleaning supplies becomes economically feasible only when the total price hits $20 to $30. Which of the following pricing objectives should the team use for its action plan? a. Volume objectives b. Prestige objectives c. Meeting competition objectives d. Profitability objectives

Volume objectives

The following statements link various changing circumstances (causes) with effects on the breakeven point. Which of these statements is inaccurate? a. When a recession cuts demand, breakeven point increases. b. When automation replaces workers, fixed cost increases while variable cost decreases; the effect on breakeven point varies. c. A price increase results in a breakeven point decrease. d. When a price war forces a price cut, breakeven point increases. e. Hiring extra staff causes breakeven point to increase.

When a recession cuts demand, breakeven point increases.

The consumer sales promotions your company is offering has increased demand slightly, but you have come to realize that another way of putting your products in front of consumers is to incentivize resellers. You decide to investigate types of trade-oriented promotions to appeal to resellers and other market intermediaries. While these promotions will cost your company money, you believe the additional incentives to resellers will convince them to continue pushing your products. Choose the trade-oriented promotion technique below with the incorrect description. a. You believe that if resellers are willing to feature your products prominently at the ends of shopping aisles, they would have a better chance of reaching their target market. You decide to provide resellers with special displays to stimulate sales of the promoted items. This illustrates POP advertising. b. You believe that retailers will stock more of your products if you offer them one free case for every dozen cases they order. This is a type of trade allowance. c. You believe that offering free samples to consumers in the flagship stores of your major resellers will convince these resellers to give your products extra shelf space. d. You believe that you can showcase your new product line by displaying it and demonstrating it to industry associates, so you plan to use trade shows.

You believe that offering free samples to consumers in the flagship stores of your major resellers will convince these resellers to give your products extra shelf space.

You are the brand manager of a major grocery store chain and have a meeting planned with your boss. You want to convince him or her to allow you to run a coupon campaign to drive sales across the soup brands you manage. Your boss is not enthusiastic about coupon campaigns, but is willing to listen to a formal presentation from you explaining how and why your coupon campaign should be approved. Select the talking point that you will use in your presentation. a. Your coupons will encourage short-term purchases of larger quantities of soup. b. As a form of trade promotion, your campaign will help build your relationships with soup wholesalers. c. High-value coupons can overcome the poor image of some of your soup brands. d. Your coupons will encourage long-term purchases of larger quantities of soup.

Your coupons will encourage short-term purchases of larger quantities of soup.

In the fall of 2014, Coca-Cola brought back Surge, its answer to PepsiCo's Mountain Dew. It had first offered Surge for sale in 1996 but had stopped production in 2002. Surge was marketed as a novelty, a revival of the brand for nostalgic consumers. Assuming that buyers would want this specialty, limited-production item quickly in order to show it off to friends, the company also featured next-day delivery, exclusively from Amazon. Which of the following price levels was most likely associated with the Surge revival? a. a value pricing level b. a reentry level c. a volume discount level d. a parity level e. a prestige item level

a prestige item level

Your family owns a commercial bakery that has always partnered with large food distributors that sell and deliver to supermarkets around the United States. You and your sister have recently taken over from the older generation and may consider other distribution options. Your sister is especially interested in shortening the distribution channel. Having more channel strategy experience than her, you explain that moving in this direction could involve all of the following actions except: a. choosing a logistics company experienced in cross-country shipping b. hiring a sales force experienced in selling baked goods c. planning a direct selling program to demonstrate the special characteristics of your packaging d. buying delivery trucks with cooling systems to retard spoilage

choosing a logistics company experienced in cross-country shipping

The vice president of marketing of a large grocery chain has determined to deemphasize the prices of the company's products and to concentrate marketing efforts on other factors such as the products' benefits and features. Which strategy is the vice president most likely to use? a. Market-minus pricing b. Skimming c. Market-plus pricing d. Penetration pricing e. Competitive pricing strategy

competitive pricing strategy

Sue runs a high-end jewelry boutique. In the past, she provided complementary gift wrapping, but there has been so much demand for this service that she has decided to start charging for it and limiting it to only one wrapped item per customer. Which of the following elements of retailing strategy is Sue about to change? a. customer amenities b. store atmospherics c. pricing d. merchandising e. customer service

customer service

Your sister recently opened a swanky three-floor cheese market, Fromagerie, which is quickly gaining attention from locals, the press, and restaurateurs in the area. Located near a college town, Fromagerie specializes in rare international cheeses; and on the top floor, there is a bistro where patrons can take cooking lessons, meet new people, dine, and sample some of the world's most savory cheeses before they make a purchase decision. The bistro element of the Fromagerie is primarily an example of your sister's retail strategy in the area of: a. merchandising b. promotion c. customer service d. atmospherics e. location

customer service

Ellie's media company will be introducing a new series of films on nutrition and exercise for adolescent health. Prior to introducing the films into the market, her company executives want to generate a buzz about the new products. So far, two of the five films have won prestigious awards at national film festivals. Ellie's superiors want to target youth-serving organizations in the Pacific Northwestern region of the United States as potential consumers of these films. They are searching for a quick way to distribute information about the products to potential customers, yet they do not want to sacrifice the personalized experiences that customers have come to associate with the company. Ellie's superiors would also like to be able to measure the performance response of whichever marketing strategy they implement. Which of the following should Ellie suggest that her superiors use to market their new products? a. Direct-response retailing b. Direct retailing c. Direct marketing d. Direct mail

direct mail

You work for a small tech company that has recently introduced a new mobile application called "Streamline" into the market. The mobile application is aimed at helping individuals keep track of all their social media accounts in one place and streamlining the flow of information from one program to the next. For instance, if you update your Facebook page, your Twitter and Instagram accounts will also update. After identifying the target market and conducting market research, the marketing team decides that its first set of ad campaigns should be Web-based in order to draw appropriate audiences. When Alexa signs into her Facebook page, a banner pops up in the center of her browser advertising Streamline, the new mobile application. After clicking on the ad, Alexa learns that she can control all of her 11 social media accounts from one place. Which of the marketing communications steps is next? a. Decoding b. Encoding c. Feedback d. Channeling

feedback

Your sales work is more of a lifestyle than a job. It often involves complex customer situations and weeks of preparation and problem solving to help find workable solutions for those situations. You enjoy it because it enables you to travel to many places and interact with people continuously. However, much of your work involves careful follow-up after your customer visits. Which personal sales channel have you chosen as a career? a. Inside selling b. Telemarketing c. Over-the-counter selling d. Field selling

field selling

All of the following are categories used to classify retailers except: a. services provided b. product lines c. shopping effort d. form of ownership e. form of financing

form of financing

The director of marketing at your company has asked you to evaluate the cost-cutting potential of using marketing intermediaries. You point out to his or her that intermediaries will save money in some, but not all, of your marketing activities. In which of the following activities would marketing intermediaries be ineffective in saving money? a. warehousing product b. maintaining inventory c. selling to multiple customers d. delivering product e. manufacturing product

manufacturing product

Which of the following is not among the three foundations of pricing strategy? a. costs b. competition c. margin d. potential demand

margin

As an industry, retail accounts for how much private-sector employment in the United States? a. less than the advertising industry b. more than the US government c. more than any other industry d. less than the direct selling industry

more than any other industry

Paul Lindsay is a logistics manager for a farm equipment manufacturer; he needs to move several tractor-trailers of farm equipment from the Midwest manufacturing plant to the East Coast distribution centers. This heavy equipment must travel a long distance—across country—and then over land to the various wholesalers that distribute them. What intermodal operation will allow Paul to combine long-hauling capacity with overland flexibility? a. Birdyback b. Run-through c. Piggyback d. Fishyback

piggyback

Mr. Cohen wants to open a hair salon and has to decide on the geographic location of the shop. He is targeting girls and young women aged 13 and older who get their hair done frequently. What sets his shop apart from other beauty salons is that all his beauticians have been trained to employ the most modern techniques and were all in the top 5 percent of their classes in their respective cosmetology schools. He wants to locate the salon within a group of similarly distinctive, upscale retailers, service providers, and department stores with high visibility in the same region. Mr. Cohen's location will be in which of the following types of shopping center? a. planned b. regional c. showroom d. multiple e. designed

planned

Selena is embarrassed. After explaining to her boss how the company's CVP (cost-volume-profit) relationship affects its pricing strategy, she realizes that she left out a key variable. Reviewing her notes, she sees that she included price, sales volume, and profit margin. What did Selena leave out? a. price sensitivity of consumers b. pricing regulations c. breakeven margin d. past pricing history

price sensitivity of consumers

You are the head of sales for an industrial machinery company. The approach you use to organizing your sales force is similar to that of many other B2B firms. This approach is: a. geographic specialization b. territory specialization c. channel specialization d. product category specialization

product category specialization

You and a coworker, Liam, are discussing the merits of different media options for placement of your firm's advertising. The options include TV, radio, direct mail, magazines, and outdoor. "I'm concerned about people's limited attention spans," says Liam. "However, its low cost is a big advantage because of our tight budget." "The short lead time for placing ads will be especially helpful, since we often change prices on short notice," you comment. "And it's great for targeting our local market." Which of the following media options are you and Liam discussing? a. TV b. magazines c. radio d. outdoor e. direct mail

radio

Which of the following is not typically a fixed cost? a. Wi-Fi access b. equipment leases c. raw materials d. rent e. insurance policies

raw materials

Ads based on fear, humor, or sex can be effective, but also face distinctive challenges. All of the following accurately describe these challenges except: a. Humor in an ad may distract consumers' attention from the brand. b. Selective perception may be a problem for humorous ads. c. People may tune out fear-based ads that seem implausible. d. Sex-based ads are tricky when used in culturally diverse markets.

selective perception may be a problem for humorous ads.

You own a mattress store called "Dream Better." Since people routinely compare your products to those offered by Sleepy's and other major competitors before making a purchase, you invest heavily in skilled salespeople and attractive displays. "Dream Better" is best classified as a: a. shopping store b. sales store c. convenience retailer d. self-service retailer e. showroom store

shopping store

You want the salespeople on your staff to perform at their best, thus you want to make sure they are properly supervised. In determining span of control—the optimal ratio of sales representatives to sales managers—you will consider all of the following factors except: a. size of bonuses b. extent of training c. each manager's ability d. complexity of work

size of bonuses

Marisol's online jewelry store originally sold only earrings and necklaces for women. After adding men's rings and cuff links, profits doubled. Given that success, Marisol may soon expand her product line to include unisex watches. Which of the following is a dimension of merchandising strategy that Marisol should consider? a. what type of repair service to offer b. the profitability of unisex watches c. when to open a brick-and-mortar outlet d. how to advertise the store

the profitability of unisex watches