MKT 3305 Ch. 1-3
differentiated marketing.
Differentiated marketing involves marketing in a number of segments, developing separate marketing strategies for each.
psychographic segmentation
Dividing the market on the basis of personality and/or lifestyles is referred to as psychographic segmentation.
The American Marketing Association's original definition of marketing focused on ________ as a central concept in marketing and the use of the basic marketing activities to create and sustain relationships with customers.
EXCHANGE --- Before 2007, the American Marketing Association's definition of marketing focused on exchange as a central concept in marketing and the use of the basic marketing activities to create and sustain relationships with customers.
The main disadvantage of publicity over other forms of promotion is its high cost.
False An advantage of publicity is its low cost, since the company is not paying for time or space in a mass medium such as TV, radio, or newspapers. While an organization may incur some costs in developing publicity items or maintaining a staff to do so, these expenses will be far less than those for the other promotional programs.
The movement that began in the 1980s toward using all forms of promotion to achieve maximum communication impact was not a fad. According to the 4As' definition, what is the name of this evolving approach to coordinate promotional elements and other marketing activities?
Integrated Marketing Communications
Offersforshoppers.com is a website that provides various offers to consumers. Users can visit the website and choose the offers that they prefer, then relevant coupons that can be redeemed at the point of purchase are sent to their mobile phones. Which of the following promotional-mix elements is occurring in this scenario?
Interactive media --- Interactive media allow for a two-way flow of communication whereby users can participate in and modify the form and content of the information they receive in real time. Unlike other forms of one-way marketing communication, such as traditional media advertising, the new interactive media allow users to perform a variety of activities such as receive, alter, and share information and images, make inquiries, respond to questions, and even make purchases online.
Seth works for Don Jagoda Associates, an agency that provides promotional planning, creative research, tie-in coordination, premium design and manufacturing, and contest/sweepstakes management, among other services. What type of specialized services agency is Don Jagoda Associates?
sales promotion agency --- Services provided by large sales promotion agencies, like Don Jagoda Associates, include promotional planning, creative research, tie-in coordination, fulfillment, premium design and manufacturing, catalog production, and contest/sweepstakes management.
demographic segmentation
segmenting markets by age, gender, income, ethnic background, and family life cycle
In developing a strategic marketing plan, what should the company do immediately after evaluating the opportunities presented by various market segments?
select target market
Star Products has made protecting and preserving the environment the core business tenet of the company. They demonstrate this commitment by re-evaluating how their products and services are created, produced, and marketed to meet the needs of the current generation without compromising the ability of future generations to meet their needs. This is called building
sustainability.
According to the survey conducted by the Association of National Advertisers, which of the following is a primary qualitative criterion that is used to evaluate the performance of ad agencies?
teamwork --- According to the survey conducted by the Association of National Advertisers, among the leading qualitative performance criteria are innovation, ideas, teamwork, meeting deadlines, strategy, and implementation.
What is the 4A's?
the American Association of Advertising Agencies (the "4As")
CL Inc., a packaged goods manufacturing company, placed an advertisement in the Independent Retailer, a monthly wholesale purchasing guide for wholesalers and retailers. The advertisement contained pictures of the product and a slogan that states, "Now here's a kiddie snack that mothers will love to see at your checkout counters." Which type of advertising has been used here?
trade advertising
A cell phone ad that portrays buyers using the phone to access their Facebook, Instagram, and Snapchat accounts is using benefit segmentation.
true
An ad agency is a service organization that specializes in planning and executing advertising programs for its clients.
true
What is a market objective?
Market objectives refer to what is to be accomplished by the overall marketing program. They are often stated in erns of sales, market share, or profitability.
marketing channel
Marketing channels, the place element of the marketing mix, are "sets of interdependent organizations involved in the process of making a product or service available for use or consumption."
What is a marketing plan?
Marketing plans can take several forms but generally include five basic elements—a detailed situation analysis, specific marketing objectives, a marketing strategy and program that include selection of target market(s), decisions and plans for the four elements of the marketing mix, a program for implementing the marketing strategy, and a process for monitoring and evaluating performance and providing feedback.
a media specialist company.
Media specialist companies are companies that specialize in the buying of media, particularly radio and television time. Agencies and clients usually develop their own media strategies and hire the buying service to execute them. Some media buying services help advertisers plan their media strategies.
What is mobile marketing?
Mobile marketing is promotional activity designed for delivery to cell phones, smartphones, tablets, and other handheld devices, including apps, messaging, commerce, and customer relationship management. Social media is an online means of communication and interactions among people that are used to create, share, and exchange content such as information, insights, experiences/perspectives, and even media themselves.
What is a major tool of direct marketing?
One of the major tools of direct marketing is direct-response advertising, whereby a product is promoted through an ad that encourages the consumer to purchase directly from the manufacturer.
what is primary demand advertising?
Primary-demand advertising is designed to stimulate demand for the general product class or entire industry. It is often used as part of a promotional strategy to help a new product gain market acceptance, since the challenge is to sell customers on the product concept as much as to sell a particular brand.
Leon works for an ad agency and is responsible for understanding the advertiser's marketing and promotions needs and interpreting them to agency personnel. He also presents the agency's recommendations to the client and obtains approval from them. Leon has a strong marketing background and understands the advertising process comprehensively. What is Leon's position in the organization?
account executive
A company that aims to position a product based on its salient features is using positioning based on
benefits. --- A common approach to positioning is setting the brand apart from competitors on the basis of the specific characteristics or benefits offered. Sometimes a product may be positioned on more than one product benefit. Marketers attempt to identify salient attributes (those that are important to consumers and are the basis for making a purchase decision).
Which of the following consists of the combination of the name, logo, symbols, design, packaging, and image of associations held by consumers?
brand identity
Average Industries is finding it difficult to differentiate their products or services on the basis of functional attributes. Through advertising, Average Industries can give consumers favorable, unique images so that they make positive associations with Average Industries. This advertising will be building a
brand image
When a company has one or more additional layers of management above brand managers to coordinate the efforts of all the brand managers handling a related group of products, it is generally using a ________ system.
category management
WomensHealth.com, a website targeting women, is an example of using gender as a basis for successful ________ segmentation.
demographic
Root Inc., a manufacturer of dental hygiene products, manufactures chocolate- and strawberry-flavored toothpastes that are specifically designed for children. Which of the following bases of segmentation is the company using?
demographic segmentation --- Root Inc. is using demographic segmentation. Dividing the market on the basis of demographic variables such as age, sex, family size, education, income, and social class is called demographic segmentation.
AB Rail Inc., a private railroad firm, offers both economy-class and business-class tickets, marketing to each segment separately using individualized marketing programs. With respect to the types of market coverage alternatives, the railroad company is using
differentiated marketing.
A company that follows a centralized system and contains a separate advertising department cannot make use of an outside advertising agency.
false --- In a centralized system, the advertising manager is responsible for all promotions activities except sales. If an outside agency is used, the advertising department is relieved of much of the executional responsibility; however, it must review and approve the agency's plans.
5-Hour ENERGY positioning itself as a sugar-free energy shot is an example of positioning by product user. Group startsTrue or False
false --- This scenario is an example of positioning by attribute or benefit. Positioning by product user emphasizes identification or association with a specific group.
Fly High Airlines provides outstanding customer service, which gives it an edge over its competitors. This outstanding customer service is used to
gain a competitive advantage.
Planet Burgers Inc. is a global food chain that caters to each market it operates in by adapting its products to local tastes and preferences. For example, burgers are made from lamb in India rather than beef due to religion-based preferences. It adds more chili sauce in Mexico and so on. Planet Burgers makes use of ________ segmentation.
geograhic --- In this scenario, Planet Burgers Inc. is using geographic segmentation. In the geographic segmentation approach, markets are divided into different geographic units. These units may include nations, states, counties, or even neighborhoods. Consumers often have different buying habits depending on where they reside. Regional differences may exist in regard to food, drinks, attitudes toward foreign products, and the like.
What is the first step in the target market selection process?
identifying markets --- When employing a target marketing strategy, the marketer identifies the specific needs of groups of people, selects one or more of these segments as a target, and develops marketing programs directed to each.
Venus Corporation recognized there are many consumers with different needs and responses to their product lines. They are working with Innovation Marketers to identify opportunities to target distinct groups whose needs and responses to their products are similar. Innovation Marketers and Venus are using
market segmentation. --- It is not possible to develop marketing strategies for every consumer. Rather, the marketer attempts to identify broad classes of buyers who have the same needs and will respond similarly to marketing actions. Market segmentation is dividing up a market into distinct groups that (1) have common needs and (2) will respond similarly to a marketing action.
Fast Growing Company is performing a promotional program situation analysis. They are currently analyzing the communication process and creating objectives for sales, market share, and profitability. In the promotional planning process, these are called
marketing objectives.
Harry has joined the marketing department of KC Cola. While going through some files, he came across a document designed for a particular brand of product that contained a detailed analysis of the environmental factors and competition. It also contained a time frame within which some objectives, further divided into tasks, had to be accomplished. The document not only listed the target markets for the brand but also contained specifications about its four Ps and various methods to check the performance of the team as well as of the brand. Which document is this likely to be?
marketing plan
Television's mass audiences are changing; no longer can advertisers depend on broadcast shows like Dallas to capture a major audience who will tune in and watch commercials until they learn who shot JR. Instead, advertisers have moved to refined Internet formats such as paid search. This widely used form of online advertising is a type of
micromarketing.
What is the most widely used form of online advertising?
paid search is the most widely used form of online advertising.
Marketing channels are the ________ element of the marketing mix.
place
A well-known brand of orange juice ran an advertising campaign that touted the health benefits of drinking orange juice. This form of advertising is known as
primary-demand advertising.
Which term is also used to describe the position of a brand manager who is responsible for the total management of the brand, including planning, budgeting, sales, and profit performance?
product manager --- A brand manager is responsible for the total management of the brand, including planning, budgeting, sales, and profit performance. The term product manager is also used to describe this position.
Eve Bar Corp., a chain of restaurants in London, launches an ad campaign that is designed to attract people who enjoy the "fast-paced lifestyle." In this scenario, the chain is using
psychographic segmentation.
Causes like the Special Olympics and the American Cancer Society are examples of products, or bundles of benefits or values that satisfy the needs of consumers.
true --- A product is more than just a physical object. A product can be a service, a cause, or a person—anything that can be marketed and that can give satisfaction to the individual when used or supported.
Dividing the market on the basis of personality and/or lifestyles is referred to as psychographic segmentation. Group startsTrue or False
true --- Dividing the market on the basis of personality and/or lifestyles is referred to as psychographic segmentation.
Database development and management is becoming one of the most important services provided by direct-response agencies.
true --- Many companies are using database marketing to pinpoint new customers and build relationships and loyalty among existing customers.
Proponents of integrated marketing communications (IMC) services argue that maintaining control of the entire promotional process achieves greater synergy among the communications program elements.
true --- Proponents of integrated marketing communications (IMC) services argue that maintaining control of the entire promotional process achieves greater synergy among the communications program elements.
Grace Mode, a car manufacturer, has adopted concentrated marketing strategy by marketing its vehicles exclusively at the premium segment.
true --- This scenario is an example of concentrated marketing. Concentrated marketing is used when a firm selects one segment and attempts to capture a large share of the market.
Jane told her friend Anne that Clean-Yes, a detergent recently launched by TG & Company, was extremely good because it not only removed tough stains but was also mild on clothes. Which type of touch point is happening in this scenario?
unexpected touch point
Why is advertising valuable?
Advertising is a valuable tool to provide consumers with information as well as to influence their perception. Advertising can be used to create favorable and unique images and associations for a brand, which can be very important for companies selling products or services that are difficult to differentiate on the basis of functional attributes.
________ is a combination of many factors, including the name, logo, symbols, design, packaging, and performance of a product or service as well as the image or type of associations that comes to mind when consumers think about a brand.
Brand identity
What is brand image?
Brand image plays an important role in the purchase of many products and services, and advertising is still recognized as one of the best ways to build a brand.
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what is a communication objective?
Communication objectives refer to what the firm seeks to accomplish with its promotional program. They are often stated in terms of the nature of the message to be communicated or what specific communication effects are to be achieved. Communication objectives may include creating awareness or knowledge about a product and its attributes or benefits, creating an image, or developing favorable attitudes, preference, or purchase intentions.
The Reflective Enterprise brand is practically a household name. To protect their brand equity, Reflective Enterprises spends huge amounts in advertising to maintain their brand recognition and reputation as the highest-quality service provider in their market. Reflective Enterprises recognized the importance of investing in
Competitive advantage --- Competitive advantage can also be achieved through advertising that creates and maintains product differentiation and brand equity. Advertising proponents have been calling for companies to protect their brand equity and franchises by investing more money in advertising instead of costly trade promotions. Some companies, recognizing the important competitive advantage strong brands provide, have been increasing their investments in them.
what is sustainability?
Sustainability, which refers to development that meets the needs of the current generation without compromising the ability of future generations to meet their needs, has become a very important issue for both consumers and corporations. Companies are addressing sustainability by carefully examining the social and environmental impact of their marketing strategies. This means re-evaluating their product and service portfolios, as well as the way these products and services are created, produced, and marketed.
Which of the following is not one of the pros of integrated marketing services?
Synergy and economies of scale are difficult to achieve. --- Opponents to an integrated services approach note that synergy and economies of scale, while nice in theory, have been difficult to achieve.
What terms are used to describe the concept of integration in IMC
Synergy, new advertising, orchestration, and seamless communication are all terms used to describe the concept of integration in IMC.
Direct-response advertising encourages customers to purchase products directly from the manufacturers.
TRUE
What is promotional planning?
The promotional planning process places importance on establishing communication goals and objectives.
Traditional media, such as television, provide marketing that is more targeted when compared to the Internet.
false
what is an account executive?
The account executive is responsible for understanding the advertiser's marketing and promotions needs and interpreting them to agency personnel. He or she coordinates agency efforts in planning, creating, and producing ads. The account executive also presents agency recommendations and obtains client approval.
client
The advertisers, or clients, are the key participants in the process. They have the products, services, or causes to be marketed, and they provide the funds that pay for advertising and promotions.
What is brand identity?
The brand identity consists of the combination of the name, logo, symbols, design, packaging, and image of associations held by consumers.
Which of the following is NOT a factor driving the integrated marketing communications movement?
The growth of mass-media advertising
Media organizations provide an environment for a firm's marketing communications message.
True --- The primary function of most media is to provide information or entertainment to their subscribers, viewers, or readers. But from the perspective of the promotional planner, the purpose of media is to provide an environment for the firm's marketing communications message.
What is an unexpected touch point?
Unexpected touch points are unanticipated references or information about a company or brand that a customer or prospect receives that is beyond the control of the organization. Probably the most influential type of unexpected contact is a word-of-mouth message, which refers to a personal communication that comes from friends, associates, neighbors, co-workers, or family members.
what is trade advertising?
a type of advertising targeted to marketing channel members such as wholesalers, distributors, and retailers. The goal is to encourage channel members to stock, promote, and resell the manufacturer's branded products to their customers.
CL Inc., a manufacturing firm, decided to outsource its entire advertising function. The company launched a new product and paid for the campaign to promote the product. In this scenario, CL Inc., is
a client
What is IMC (Integrated Marketing Communications)?
a concept of marketing communications planning that recognizes the added value of a comprehensive plan that evaluates the strategic roles of a variety of communication disciplines—for example, general advertising, direct response, sales promotion, and public relations—and combines these disciplines to provide clarity, consistency, and maximum communications impact.
Under ________, the client agrees to pay the agency a fee based on the expenditure of its work plus some agreed-on profit margin, often a percentage of total costs.
a cost-plus system --- Under a cost-plus system, the client agrees to pay the agency a fee based on the costs of its work plus some agreed-on profit margin (often a percentage of total costs).
Abound Industries is a multiproduct firm. In addition to competing with outside manufacturers, each brand it produces actually competes against other brands within the company. Abound brands also compete for corporate resources, leading to unproductive rivalries. The type of approach Abound Industries has been using is called
a decentralized approach. --- In a multiproduct firm, each brand may have its own ad agency and may compete against other brands within the company, not just against outside competitors. One problem of the decentralized approach is that individual brand managers often end up competing for management attention, marketing dollars, and other resources, which can lead to unproductive rivalries and potential misallocation of funds.
Mars Inc. is a specialized agency that provides various services such as database management, infomercial production, creative services, telemarketing, research, and media services. In this scenario, Mars Inc. is
a direct-marketing agency. --- In this scenario, Mars Inc. is an example of a direct-marketing agency. Direct-marketing agencies provide a variety of services, including database management, direct mail, research, media services, and creative and production capabilities. While direct mail was traditionally their primary weapon, many direct-marketing agencies are expanding their services to include such areas as infomercial production and database management.
Firm Software Co. has audited their advertising budget for the last three years, identifying a pattern of expenses. They found that their media expenses were fairly consistent from year to year. They decided to change their compensation plan for their agency from a monthly billing to a monthly fee where media commission received by the agency will be credited against the fee. If the commissions are less than the fee, Firm Software will make up the difference in a quarterly billing cycle. This form of commission is called ________ combination.
a fee-commission --- Sometimes agencies are compensated through a fee-commission combination, in which the media commissions received by the agency are credited against the fee. If the commissions are less than the fee, the client must make up the difference.
Sum Company has depended on key people in each product line to come up with advertising to promote their individual products. This approach has not produced the results they anticipated, and the board is seeking a change in process. They are now looking for an advertising agency that offers its clients a full range of marketing, communications, and promotion services, including planning, creating, and producing the advertising, performing research, and selecting media. Sum is looking for ________.
a full-service agency --- Sum Company is struggling with brand identity. Their departmental approach was fragmented and did not produce results. Sum needs a full-service agency, which offers its clients a full range of marketing, communications, and promotion services, including planning, creating, and producing the advertising, performing research, and selecting media, to help create a brand approach.
NW Inc. specializes in buying radio, television, and newspaper space at discounted rates. Yummy Foods approaches NW Inc. to buy newspaper space at less than market rate. NW's personnel also help Yummy Foods plan their media strategies. However, they do not perform any other functions. In this scenario, NW Inc. is an example of Multiple Choice
a media specialist company.
KB Enterprises is struggling with making their projected sales quotas. They engaged a task force to review their current marketing plan and promotional program. The task force has just completed a review of the marketing plan and is now ready to conduct a situational analysis focusing on factors such as the firm's customers' characteristics and buying patterns, their decision process, and factors influencing their purchase decisions. This analysis is called
an EXTERNAL analysis --- The external analysis focuses on factors such as characteristics of the firm's customers, market segments, positioning strategies, and competitors. An important part of the external analysis is a detailed consideration of customers' characteristics and buying patterns, their decision process, and factors influencing their purchase decisions. A key element of the external analysis is an assessment of the market. The external phase also includes an analysis of the marketing environment and current trends or development that might affect the promotional program.
Joy Fruit Juices took the help of a company called Innovators Inc. to create and produce the communication message for its products and in return paid Innovators $20,000 as compensation. However, the final decisions regarding the advertising and promotional program rested with Joy Fruit Juices. In this scenario, Innovators is
an ad agency --- In this scenario, Innovators Inc. is an advertising agency. Many organizations use an advertising agency, which is an outside firm that specializes in the creation, production, and/or placement of the communications message and that may provide other services to facilitate the marketing and promotions process.
A small entrepreneurial firm for the last five years, Clear Cite industries is ready to broaden their efforts to expand beyond the tri-state area to a nationwide market. With their growth, they have identified the need for new roles in their organization. They have a number of salespeople, but their promotions effort has been lacking. They have determined a critical role with key responsibilities for coordinating input from people both inside and outside the organization to help define the advertising and promotion process. This position is called
an advertising manager. --- While many people both inside and outside an organization have some input into the advertising and promotion process, direct responsibility for administering the program must be assumed by someone within the firm, called the advertising manager.
GSI industries is looking for several dedicated services to develop and maintain their website and digital marketing. They also need support to create a strategy and media plan to refresh their brand. A medium-size company, GSI may want to engage the services of ________ to coordinate these IMC services.
an agency of record --- In this scenario, GSI industries is looking for an Agency of Record (AOR), which is a single agency that has primary responsibility for most of the IMC services that a company or brand might require, such as brand and creative strategy, media planning, development and maintenance of websites, and digital marketing.
Superagencies are:
an amalgamation of several small, medium, and large advertising agencies. --- During the late 1980s and into the 1990s, the advertising industry underwent major changes as large agencies merged with or acquired other agencies and support organizations to form large advertising organizations, or superagencies. These superagencies were formed so that agencies could provide clients with integrated marketing communications services worldwide.
What is advertising?
any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor
Which of the following is not one of the terms used to describe the concept of integration in IMC?
autonomous channels
Tom, a chocolate maker, placed ads for his chocolate bars in Magz, a magazine that is popular among the managers of large hotels. Knowing that these hotels use chocolate for desserts on a daily basis, Tom wanted to bring his product to the attention of hotels' purchasing managers. Tom is using
business-to-business advertising.
When Dole encourages consumers to "drink their fruits," claiming that eight ounces of juice is the equivalent of two whole fruits, it is positioning itself
by product class.Correct --- Often the competition for a product comes from outside the product class. Rather than positioning against another brand, an alternative strategy is to position oneself against another product category.
Blueberry Designs, a boutique, has an advertising department along with sales, marketing, and research departments. The manager of the advertising department heads and controls all the functions of that department, such as budgeting, planning media schedules, and administering the sales promotions programs for all of the company's products and services. Blueberry Designs employs a
centralized marketing system. --- In a centralized system, the advertising manager is responsible for all promotions activities except sales. In the most common example of a centralized system, the advertising manager controls the entire promotions operation, including budgeting, coordinating creation and production of ads, planning media schedules, and monitoring and administering the sales promotions programs for all the company's products or services.
One Stop Corporation has been working with Top Agency to analyze their promotional plan to include methods for creating awareness about One Stop's product attributes, methods for developing favorable attitudes, and how to better understand consumer purchase intentions. What type of goals or objectives are they creating at this stage of the integrated marketing communications plan?
communication objectives
Reflective Enterprises has depended on magazine, newspaper, and television advertising for most of their advertising efforts. They are losing market share. They recognize that they need to change their strategy to reach an audience that rarely engages in these forms of media. They are looking for a new agency partner to develop a social media campaign. To help develop the resources to support this new direction, the VP of marketing engages the services of a
digital agency --- With the rapid growth of the Internet and other forms of media, a new type of specialized marketing communications organization has evolved to meet the changing needs of marketers. Many marketers are using digital agencies that specialize in using various digital marketing tools such as website design and development, apps, search engine optimizations (SEO), banner ads, video, mobile marketing, and social media campaigns.
Advocare, Tupperware, and Mary Kay are examples of companies that choose not to use any channel intermediaries, but instead sell to their customers through
direct channels.
Over the last two decades, increased access to mobile devices, greater Internet usage, and more double-income families have meant more income but less time for shopping for many people. As a result, marketing agencies have used ________ to encourage consumers to purchase products and services directly from the manufacturer.
direct-response marketing
A type of media called ________ generates exposure for a company or brand through outside entities such as the media or the general public; the company or brand does not pay for it. One of the best examples of this type of media occurred in 2014 when the ALS Ice Bucket Challenge to promote awareness of the disease and encourage donations to research went viral.
earned media
Large organizations and firms usually spend huge sums of money on promotional activities because it guarantees the success of a product.
false
Mobile marketing is an online means of communication and interactions among people that are used to create, share, and exchange content such as information, insights, experiences/perspectives, and even media themselves.
false
Having a marketing and communications strategy to market consumer products and services adds value by strategically integrating the various communication functions into one plan versus having them operate autonomously. What is the name of the plan for coordinating efforts to avoid duplication, take advantage of synergy among promotional tools, and develop more efficient and effective marketing communication programs?
imc plan --- A fundamental reason marketers are adopting the IMC approach is that they understand the value of strategically integrating the various communication's functions rather than having them operate autonomously. By coordinating their marketing communication efforts, companies can avoid duplication, take advantage of synergy among promotional tools, and develop more efficient and effective marketing communication programs.
Money Backed Enterprises still uses an agency commission system designed in the 1990s. They say that the commission system of agency compensation is more flexible; by charging a large commission, they have the flexibility to perform other services for large clients at no extra charge. In addition, the commission system
is easy to administer. --- Defenders of the commission system argue that it is easy to administer and keeps the emphasis in agency compensation on nonprice factors such as quality of the advertising developed for clients. They also note that the system is more flexible than it appears because agencies often perform other services for large clients at no extra charge as a way of justifying the large commission they receive.
