Chapter 16

Which of the following is true of horizontal cooperative advertising?

A. It is sponsored by a group of retailers. Horizontal cooperative advertising is advertising sponsored in common by a group of retailers or other organizations providing products or services to the market.

What advantage does distribution of coupons through direct mail have over other forms of coupon delivery?

A. Precise reach. Direct-mail couponing has several advantages. First, the mailing can be sent to a broad audience or targeted to specific geographic or demographic markets such as teenagers, senior citizens, Hispanics, and other market segments.

Which of the following types of sales promotions are also called continuity programs?

B. Loyalty programs. One of the fastest-growing areas of sales promotion is the use of loyalty programs (also referred to as continuity or frequency programs).

Which of the following is true of allocation of the promotional budget when a brand enters the introductory stage?

B. In this stage, a large portion of the budget will be allocated to sales promotion techniques. With respect to the allocation of the promotional budget according to a brand's stage in the product life cycle, in the introductory stage, a large amount of the budget may be allocated to sales promotion techniques such as sampling and couponing to induce trial.

_____ is an exhibition or forum where manufacturers can display their products to current and prospective buyers.

D. A trade show. One important promotional activity targeted to resellers is a trade show, a forum where manufacturers can display their products to current as well as prospective buyers.

True or False. A major reason for decrease in sales promotion is that customers have become less brand loyal.

FALSE A major reason for the increase in sales promotion is that consumers have become less brand loyal and are purchasing more on the basis of price, value, and convenience.

True or False. Sales promotion activities cannot be targeted to different parties in the marketing channel.

FALSE An important point regarding sales promotion activities is that they can be targeted to different parties in the marketing channel.

_____ is advertising sponsored in common by a group of retailers or other organizations providing products or services to the market.

A. Horizontal cooperative advertising. Horizontal cooperative advertising is advertising sponsored in common by a group of retailers or other organizations providing products or services to the market.

Which of the following statements is true of slotting allowances?

A. Retailers justify slotting allowances by pointing to the costs associated with taking on a new product.

With respect to the allocation of the promotional budget, when a brand moves to the maturity stage:

B. advertising is primarily a reminder to keep consumers aware of the brand. With respect to the allocation of the promotional budget, according to a brand's stage in the product life cycle, when a brand moves to the maturity stage, advertising is primarily a reminder to keep consumers aware of the brand.

Sales promotion activities that communicate distinctive brand attributes and contribute to the development and reinforcement of brand identity are known as:

B. consumer franchise-building promotions. Sales promotion activities that communicate distinctive brand attributes and contribute to the development and reinforcement of brand identity are consumer franchise building (CFB) promotions. Consumer sales promotion efforts cannot make consumers loyal to a brand that is of little value or does not provide them with a specific benefit.

A(n) _____ is a configuration of products that occupy a shelf section in a store, offered to retailers by manufacturers.

B. planogram. Many manufacturers help retailers use shelf space more efficiently through planograms, which are configurations of products that occupy a shelf section in a store. Some manufacturers are developing computer-based programs that allow retailers to input information from their scanner data and determine the best shelf layouts by experimenting with product movement, space utilization, profit yields, and other factors.

VB Inc., a shoe manufacturer, sponsors a campaign that advertises the availability of its running shoes at Shoe Rack, a retail chain. This is an example of _____ advertising.

B. vertical cooperative. The above scenario is an example of vertical cooperative advertising. The most common form of cooperative advertising is the trade-oriented form, vertical cooperative advertising, in which a manufacturer pays for a portion of the advertising a retailer runs to promote the manufacturer's product and its availability in the retailer's place of business.

_____ marketing is a type of marketing in which a manufacturer collaborates with an individual retailer to create a customized promotion that accomplishes mutual objectives.

C. Account-specific. A major development in recent years is account-specific marketing (also referred to as comarketing), whereby a manufacturer collaborates with an individual retailer to create a customized promotion that accomplishes mutual objectives.

25. Which of the following developments has resulted in a transfer of power from manufacturers to retailers?

C. Consolidation in the grocery industry has resulted in larger chains with greater buying power and clout. One factor that has increased the power of retailers is the consolidation of the grocery store industry, which has resulted in larger chains with greater buying power and clout. Consolidation has also given large retailers more money for advancing already strong private label initiatives, and sales promotion is the next step in the marketing evolution of private label brands.

Which of the following sales promotion techniques is impacted negatively by the presence of professionals or hobbyists who take advantage of the promotion without making a purchase?

C. Contests and sweepstakes. One problem with contests and sweepstakes is the participation in them by hobbyists who submit entries but have no real interest in the product or service. Because most states make it illegal to require a purchase as a qualification for a sweepstakes entry, consumers can enter as many times as they wish.

Which of the following is a limitation of sampling through the mail?

C. It involves extensive postal restrictions. Sampling through the mail is common for small, lightweight, nonperishable products. The main drawbacks to mail sampling are postal restrictions and increasing postal rates.

Which of the following statements describes how brand equity is affected by the increased use of sales promotion?

C. Marketing experts argue that higher spending on sales promotion is at the expense of media advertising, which leads to a decline in brand equity. Marketing experts are concerned that if the trend toward spending more on sales promotion at the expense of media advertising continues, brands may lose the equity that advertising helped create and be forced to compete primarily on the basis of price.

Which of the following statements is true of rebates?

C. Nonusers of rebates perceive the rebate redemption process as too complicated. Nonusers of rebates were particularly likely to perceive the redemption process as too complicated and to suspect manufacturers' motives. This implies that companies using rebates must simplify the redemption process and use other promotional elements such as advertising to retain consumer confidence in the brand.

Marketers who are being held accountable for strategy implementation often need concrete methods to show the effectiveness of their decision-making. Which of the following would best support a marketer in producing quick and easily measurable jump in sales?

C. Sales promotions such as coupons and price discounts. Managers who are being held accountable to produce results often use price discounts or coupons, since they produce a quick and easily measured jump in sales. It takes longer for an ad campaign to show some impact and the effects are more difficult to measure.

_____ involves a variety of procedures whereby consumers are given some quantity of a product for no charge to induce trial.

C. Sampling. Sampling involves a variety of procedures whereby consumers are given some quantity of a product for no charge to induce trial.

Which of the following is an advantage of sampling through the mail?

C. The marketer has control over where and when the product will be distributed. Sampling through the mail is common for small, lightweight, nonperishable products. A major advantage of this method is that the marketer has control over where and when the product will be distributed and can target the sample to specific market areas.

How are marketers responding to the fragmentation of the consumer market?

C. They are using more sales promotions that are tied to local events. As the consumer market becomes more fragmented and traditional mass-media-based advertising less effective, marketers are turning to more segmented, highly targeted approaches. Sales promotion tools have become one of the primary vehicles for doing this, through programs tied into local flavor, themes, or events.

A manufacturer of skis and skiing accessories provides sales personnel in ski shops with instruction classes, detailed manuals, and other tools to help them better understand how to sell the company's ski boots. This is an example of:

C. a sales training program. The above scenario is an example of a sales training program. Manufacturers provide sales training assistance to retail salespeople in a number of ways. They may conduct classes or training sessions that retail personnel can attend to increase their knowledge of a product or a product line. These training sessions present information and ideas on how to sell the manufacturer's product and may also include motivational components.

An appliance manufacturer offers a $50 payment to salespeople who work at J&J Appliance Inc., a retailer, for each sale of the company's new line of refrigerators. This payment by J&J Appliance is known as:

C. a spiff. In the above scenario, the payment made to the salespeople is known as a spiff. Manufacturers often devise incentives or contests for the sales personnel. These programs may involve cash payments made directly to the retailer's or wholesaler's sales staff to encourage them to promote and sell a manufacturer's product. These payments are also known as push money (pm) or spiffs.

NapTime Inc., a manufacturer of mattresses, gave away a Sheep plush toy to any customer who purchased a mattress from a NapTime dealer. The toy was only available for a limited period. The plush toy is an example of a:

C. free premium. In the above scenario, the plush toy is an example of a free premium. Free premiums are usually small gifts or merchandise included in the product package or sent to consumers who mail in a request along with a proof of purchase. In/on-package free premiums include toys, balls, trading cards, or other items included in cereal packages, as well as samples of one product included with another.

Packages of Vinnie's Cornmeal have coupons that can be cut out and redeemed at the time of purchase. These are called _____ coupons.

C. instant. In the above scenario Vinnie's Cornmeal uses instant coupons. One type of package coupon is the instant coupon, which is attached to the outside of the package so the consumer can rip it off and redeem it immediately at the time of purchase.

Advertising implemented by retailers and paid for, at least in part, by a manufacturer is called:

C. vertical cooperative advertising. The most common form of cooperative advertising is the trade-oriented form, vertical cooperative advertising, in which a manufacturer pays for a portion of the advertising a retailer runs to promote the manufacturer's product and its availability in the retailer's place of business. Manufacturers generally share the cost of advertising run by the retailer on a percentage basis up to a certain limit.

Which of the following is true of allocation of the promotional budget when a brand enters the decline stage?

D. In this stage, all the promotional support for the brand will be removed. With respect to the allocation of the promotional budget, according to a brand's stage in the product life cycle, when a brand enters the decline stage of the product life cycle, most of the promotional support will probably be removed and expenditures on sales promotion are unlikely.

Which of the following is true of allocation of the promotional budget when a brand enters the growth stage?

D. In this stage, promotional dollars must be used primarily for advertising to stress brand differences. With respect to the allocation of the promotional budget according to a brand's stage in the product life cycle, in the growth stage, promotional dollars may be used primarily for advertising to stress brand differences and keep the brand name in consumers' minds.

Which of the following is true of the increase in sales promotion by brand managers?

D. Sales promotions are typically used by brand managers to meet quarterly goals. Brand managers use sales promotions routinely, not only to introduce new products or defend against the competition but also to meet quarterly or yearly sales and market share goals.

An advantage of coupons is that they:

D. allow a marketer to offer a price reduction only to consumers who are price sensitive. Coupons make it possible to offer a price reduction only to those consumers who are price-sensitive. Such consumers generally purchase because of coupons, while those who are not as concerned about price buy the brand at full value.

Slotting allowances are also called _____.

D. street money. Slotting allowances, also called stocking allowances, introductory allowances, or street money, are fees retailers charge for providing a slot or position to accommodate the new product.

The sales promotion tool that critics contend is most guilty of detracting from brand equity and at the same time being detrimental to a brand franchise is:

D. trade promotions. Trade promotions receive the most criticism for being nonfranchise building. Many specialists in the promotional area stress the need for marketers to use sales promotion tools to build a franchise and create long-term continuity in their promotional programs.

True or False. The use of newspapers and magazines as couponing vehicles has increased dramatically since the introduction of FSIs.

FALSE The use of newspapers and magazines as couponing vehicles has declined dramatically since the introduction of FSIs as only 1 percent of coupons is distributed via newspapers and magazines.

True or False. Sales promotion involves some type of inducement that provides an extra incentive to buy.

TRUE Sales promotion involves some type of inducement that provides an extra incentive to buy. This incentive is usually the key element in a promotional program; it may be a coupon or price reduction, the opportunity to enter a contest or sweepstakes, a money-back refund or rebate, or an extra amount of a product.

True or False. Sampling through the mail is common for small, lightweight, nonperishable products.

TRUE Sampling through the mail is common for small, lightweight, nonperishable products. A major advantage of this method is that the marketer has control over where and when the product will be distributed and can target the sample to specific market areas.

A package of Confident razor blades contains a 75 cent-off coupon for Confident Foamy shaving cream. This is an example of a(n) _____ coupon.

A. cross-ruff. The above scenario is an example of a cross-ruff coupon. A type of in/on-pack coupon is the cross-ruff coupon, which is redeemable on the purchase of a different product, usually one made by the same company but occasionally through a tie-in with another manufacturer.

The in-store sampling approach can be very effective for food products because:

A. customers get to taste the sample. The in-store sampling approach can be very effective for food products, since consumers get to taste the item and the demonstrator can give them more information about the product while it is being sampled. Demonstrators may also give consumers a cents-off coupon for the sampled item to encourage immediate trial purchase.

Some retailers have demanded payment for new products that do not reach a minimum sales target. These payments are called:

A. failure fees. A failure fee is demanded by retailers if a new product does not hit a minimum sales level within a certain time. The fee is charged to cover the costs associated with stocking, maintaining inventories, and then pulling the product.

According to attribution theory, a consumer who purchases a product on promotion may not repurchase it because the:

A. purchase behavior is attributed to an external incentive. According to the attribution theory, consumers who consistently purchase a brand because of a coupon or price-off deal may attribute their behavior to the external promotional incentive rather than to a favorable attitude toward the brand.

Money that must be paid to a retailer so it will take on a company's new product is known as:

A. slotting allowances. Slotting allowances, also called stocking allowances, introductory allowances, or street money, are fees retailers charge for providing a slot or position to accommodate the new product.

_____ is advertising supported by raw materials manufacturers to help establish end products that include a company's materials.

B. Ingredient-sponsored cooperative advertising. Ingredient-sponsored cooperative advertising is supported by raw materials manufacturers; its objective is to help establish end products that include the company's materials and/or ingredients.

_____ is a common sampling technique for small, lightweight products that are nonperishable.

B. Sampling through the mail. Sampling through the mail is common for small, lightweight, non-perishable products. A major advantage of this method is that the marketer has control over where and when the product will be distributed and can target the sample to specific market areas.

_____ is generally considered the most effective method for generating trial of a new product.

B. Sampling. Sampling is generally considered the most effective way to generate trial, although it is also the most expensive. As a sales promotion technique, sampling is often used to introduce a new product or brand to the market.

Which of the following is true of self-liquidating premiums?

B. They require customers to pay for the mailing costs. Self-liquidating premiums require the consumer to pay some or all of the cost of the premium plus handling and mailing costs. The marketer usually purchases items used as self-liquidating premiums in large quantities and offers them to consumers at lower-than-retail prices.

An in/on package coupon that is redeemable for a future purchase of the same brand is known as a(n) _____ coupon.

B. bounce-back. An in/on-pack coupon that is redeemable for the next purchase of the same brand is known as a bounce-back coupon. This type of coupon gives consumers an inducement to repurchase the brand.

Which of the following is true of consumer franchise-building promotions?

A. They are designed to increase long-term brand preference. Consumer franchise-building promotions are designed to build long-term brand preference and help the company achieve the ultimate goal of full-price purchases that do not depend on a promotional offer.

Coupons, bonus packs, premiums, and samples are promotional offers that are targeted toward:

A. end users. Activities involved in consumer-oriented sales promotion include sampling, couponing, premiums, contests and sweepstakes, refunds and rebates, bonus packs, price-offs, frequency programs, and event marketing. These promotions are directed at consumers, the end purchasers of goods and services, and are designed to induce them to purchase the marketer's brand.

Which of the following is true of consumer franchise building (CFB) promotions?

B. CFB promotions cannot make consumers loyal to a brand that is of little value. Consumer franchise-building promotions are designed to build long-term brand preference and help the company achieve the ultimate goal of full-price purchases that do not depend on a promotional offer.

Every time Beth buys a book at The Venus Bookstore, she presents her Venus card, and the sales associate enters her purchase in a database. When she has purchased five books at regular price, she is sent a coupon for a free book to be picked out on her next visit to the store. This is an example of a:

B. frequency program. The above scenario is an example of a frequency program. Many packaged-goods companies and others have recently introduced continuity programs (also known as loyalty and frequency programs) that offer consumers the opportunity to accumulate points for continuing to purchase their brands; the points can be redeemed for gifts and prizes.

Which of the following is an example of a nonfranchise-building promotion?

C. Price-off deals. Price-off deals, bonus packs, and rebates or refunds are examples of non-FB sales promotion techniques. Trade promotions receive the most criticism for being nonfranchise building—for good reason.

A(n) _____ is an offer of an item of merchandise or services, either free or at a reduced price, that is used to provide an extra incentive to purchase.

C. premium. A premium is an offer of an item of merchandise or services, either free or at a low price, that is an extra incentive for purchasers. Many marketers are eliminating toys and gimmicks in favor of value-added premiums that reflect the quality of the product and are consistent with its image and positioning in the market.

Programs involving cash payments directly to the sales force to reward them for selling the manufacturer's products involve the use of:

C. push money. Manufacturers often devise incentives or contests for the sales personnel. These programs may involve cash payments made directly to the retailer's or wholesaler's sales staff to encourage them to promote and sell a manufacturer's product. These payments are known as push money.

Samples would be an appropriate promotional strategy:

C. to introduce a new product into the marketplace. As a sales promotion technique, sampling is often used to introduce a new product or brand to the market. However, sampling is also used for established products as well.

Planet Beverage's heavy financial involvement with freestyle skiing competitions and support of beach volleyball tournaments are examples of:

D. event marketing. The above scenario is an example of event marketing. Event marketing is a type of promotion where a company or brand is linked to an event or where a themed activity is developed for the purpose of creating experiences for consumers and promoting a product or service. Marketers often do event marketing by associating their product with some popular activity such as a sporting event, concert, fair, or festival.

True or False. Which of the following elements of the integrated marketing communications program is designed to provide an extra incentive to consumers to purchase a brand?

E. Sales promotion Sales promotion involves some type of inducement that provides an extra incentive to buy. This incentive is usually the key element in a promotional program; it may be a coupon or price reduction, the opportunity to enter a contest or sweepstakes, a money-back refund or rebate, or an extra amount of a product.

True or False. Event sampling is where a package is attached to another item.

FALSE On-package sampling, where a sample of a product is attached to another item, is a common sampling method.

True or False. Promotion programs cannot be developed to coincide with peak sales periods for certain products and services.

FALSE Promotion programs also can be developed to coincide with peak sales periods for certain products and services.

True or False. Sampling is generally considered the least effective way to generate trial.

FALSE Sampling involves a variety of procedures whereby consumers are given some quantity of a product for no charge to induce trial. Sampling is generally considered the most effective way to generate trial, although it is also the most expensive.

True or False. A major reason for the increase in spending on sales promotion is that the promotion industry has matured over the past several decades.

TRUE A major reason for the increase in spending on sales promotion is that the promotion industry has matured over the past several decades.

True or False. A strategy for increasing sales of an established brand is to use promotions that attract nonusers of the product category or users of a competing brand.

TRUE A strategy for increasing sales of an established brand is to use promotions that attract nonusers of the product category or users of a competing brand.

True or False. An objective for consumer-oriented promotions is to enhance or support the integrated marketing communications effort for a brand or company.

TRUE An objective for consumer-oriented promotions is to enhance or support the integrated marketing communications effort for a brand or company. While building and/or maintaining brand equity was traditionally viewed as something that was done through media advertising, it has also become an important goal for marketers as they develop their sales promotion programs.

True or False. Cross-cuff coupons are redeemable on the purchase of a different product, usually one made by the same company but occasionally through a tie-in with another manufacturer.

TRUE Cross-cuff coupons are redeemable on the purchase of a different product, usually one made by the same company but occasionally through a tie-in with another manufacturer.

True or False One of the most important uses of sales promotion techniques is to encourage consumers to try a new product or service.

TRUE One of the most important uses of sales promotion techniques is to encourage consumers to try a new product or service.

True or False. The oldest, most widely used, and most effective sales promotion tool is the cents-off coupon.

TRUE The oldest, most widely used, and most effective sales promotion tool is the cents-off coupon.

Which of the following have the highest redemption levels of all types of coupons?

C. Instant coupons. Instant coupons have the highest redemption levels of all types of coupons, averaging around 20 percent for food products and 27 percent for nonfood items. However, the redemption level is much lower for instant cross-ruff coupons, as it averages around 8 percent.

_____ is a sampling method in which the product is delivered directly to the prospect's residence.

D. Door-to-door sampling. Door-to-door sampling, in which the product is delivered directly to the prospect's residence, is used when it is important to control where the sample is delivered.

One reason for consumers' increased sensitivity to sales promotions is:

D. that they save money. An obvious reason for consumers' increased sensitivity to sales promotion offers is that they save money. Another reason is that many purchase decisions are made at the point of purchase by consumers who are increasingly time-sensitive and facing too many choices.

Which of the following sampling methods, featuring media tie-ins, is the fastest-growing and the most popular?

A. Event sampling. Event sampling has become one of the fastest-growing and most popular ways of distributing samples. Many marketers are using sampling programs that are part of integrated marketing programs that feature events, media tie-ins, and other activities that provide consumers with a total sense of a brand rather than just a few tastes of a food or beverage or a trial size of a packaged-goods product.

Why have frequency programs become so popular with marketers?

A. Frequency programs support the goal of customer retention. There are a number of reasons why loyalty programs have become so popular. Marketers view these programs as a way of encouraging consumers to use their products or services on a continual basis and as a way of developing strong customer loyalty and retention.

How has the view of sales promotions changed during the past decades?

A. Sales promotions are now considered an essential part of an organization's branding strategies. In the past, sales promotion specialists would be brought in after key strategic branding decisions were made. However, many companies are now making promotional specialists part of their strategic brand-building team, a move that puts sales promotion on par with media advertising.

Which of the following promotions is targeted toward the trade rather than consumers?

A. Spiffs. Manufacturers often devise incentives or contests for the sales personnel. These programs may involve cash payments made directly to the retailer's or wholesaler's sales staff to encourage them to promote and sell a manufacturer's product. These payments are also known as push money (pm) or spiffs.

Which of the following is a disadvantage of bounce-back coupons?

A. They do not attract nonusers of a particular brand. The main limitation of bounce-back coupons is that they go only to purchasers of the brand and thus do not attract nonusers.

50. The oldest, most widely used, and most effective sales promotion tool is:

A. cents-off coupons. The oldest, most widely used, and most effective sales promotion tool is the cents-off coupon. Coupons have been around since 1895, when the C. W. Post Co. started using the penny-off coupon to sell its new Grape-Nuts cereal.

Yummy Oats cereal included tubes of ToothFairy Junior toothpaste inside each of its boxes. This is an example of a:

A. free premium. The above scenario is an example of free premiums. Free premiums are usually small gifts or merchandise included in the product package or sent to consumers who mail in a request along with a proof of purchase. In/on-package free premiums include toys, balls, trading cards, or other items included in cereal packages, as well as samples of one product included with another.

The most popular method for distributing coupons is through:

A. newspaper freestanding inserts. Distribution through newspaper freestanding inserts (FSIs) is by far the most popular method for delivering coupons to consumers, accounting for 90 percent of all coupons distributed. An FSI is a four-color multipage printed advertising booklet that contains consumer packaged goods coupon offers delivered with newspapers (usually in Sunday editions).

Which of the following statements is true of couponing?

B. Coupons are often used by consumers who are already loyal to the brand. A problem associated with using coupons to attract new users to an established brand is that it is difficult to prevent the coupons from being used by consumers who already use the brand. Rather than attracting new users, coupons can end up reducing the company's profit margins among consumers who would probably purchase the product anyway. However, they can help retain users.

On the inside of its pizza box, Joe's Pizza places a $1-off coupon, which can be redeemed at the next purchase. In this scenario, Joe's is using a(n) _____ coupon.

B. bounce-back. In the above scenario Joe's Pizza uses bounce-back coupons. An in/on-pack coupon that is redeemable for the next purchase of the same brand is known as a bounce-back coupon. This type of coupon gives consumers an inducement to repurchase the brand.

Sweepstakes and contests:

B. can be used to generate excitement and involvement with a popular and timely event. Contests and sweepstakes are an increasingly popular consumer-oriented promotion. Marketers are attracted to contests and sweepstakes as a way of generating attention and interest among a large number of consumers.

Account-specific marketing is also known as:

B. comarketing. A major development in recent years is account-specific marketing (also referred to as comarketing), whereby a manufacturer collaborates with an individual retailer to create a customized promotion that accomplishes mutual objectives.

A _____ is a promotion where consumers compete for prizes and/or money on the basis of skills or ability.

B. contest. A contest is a promotion where consumers compete for prizes or money on the basis of skills or ability. The company determines winners by judging the entries or ascertaining which entry comes closest to some predetermined criteria (e.g., picking the winning teams and total number of points in the Super Bowl or NCAA basketball tournament).

Pluto Inc. places a 50 cent-off coupon for another brand, Krispies maple syrup, on the outside of boxes of its Pluto Rice Cereal. This is an example of a(n) _____ coupon.

B. cross-ruff. The above scenario is an example of a cross-ruff coupon. A type of in/on-pack coupon is the cross-ruff coupon, which is redeemable on the purchase of a different product, usually one made by the same company but occasionally through a tie-in with another manufacturer.

Brand equity is also known as:

B. customer franchise. Brand equity, or consumer franchise, is an intangible asset of added value or goodwill that results from consumers' favorable image, impressions of differentiation, and/or strength of attachment to a brand.

Spring Supermarket gives its customers VIC (very important customer) cards, which give customers additional discounts on certain products and notifications of special, customer-only sales. In addition, customers can accrue points each time they present their cards while making a purchase. These points can be used to purchase cookware, dishes, and other similar hard goods. Spring Supermarket is using a:

B. frequency program. In the above scenario, Spring Supermarket is using a frequency program. Many packaged-goods companies and others have recently introduced continuity programs (also known as loyalty and frequency programs) that offer consumers the opportunity to accumulate points for continuing to purchase their brands; the points can be redeemed for gifts and prizes.

Bonus packs:

B. help marketers provide extra value to consumers without having them do anything more than purchase the product. Bonus packs give marketers a direct way to provide extra value without having to get involved with complicated coupons or refund offers.

Promotional activities designed to accelerate the purchase process and generate an immediate increase in sales without communicating information about a brand's unique features or benefits are known as:

B. nonfranchise-building promotion. Nonfranchise-building (non-FB) promotions are designed to accelerate the purchase decision process and generate an immediate increase in sales. These activities do not communicate information about a brand's unique features or the benefits of using it, so they do not contribute to the building of brand identity and image.

Consumers must pay the manufacturers' cost-price or a _____ premium.

B. self-liquidating. Self-liquidating premiums require the consumer to pay some or all of the cost of the premium plus handling and mailing costs. The marketer usually purchases items used as self-liquidating premiums in large quantities and offers them to consumers at lower-than-retail prices.

A _____ is a promotion where winners are determined purely by chance.

B. sweepstakes. A sweepstakes is a promotion where winners are determined purely by chance; it cannot require a proof of purchase as a condition for entry. Entrants need only submit their names for the prize drawing.

Another term used for push money that is given to retailers' or wholesalers' sales staff to encourage them in promoting and selling a company's product is:

C. a spiff. Manufacturers often devise incentives or contests for the sales personnel. These programs may involve cash payments made directly to the retailer's or wholesaler's sales staff to encourage them to promote and sell a manufacturer's product. These payments are known as push money or spiffs.

A discount or deal offered to a retailer or wholesaler to encourage them to stock, promote, or display a manufacturer's product is known as:

C. a trade allowance. Trade allowance is a discount or deal offered to retailers or wholesalers to encourage them to stock, promote, or display the manufacturer's products. Types of allowances offered to retailers include buying allowances, promotional or display allowances, and slotting allowances.

Dewy, a fruit juice manufacturer, offers its retail accounts a $3.00 per case discount on all purchases of cranberry juice during the month of May. This discount will be deducted straight from the bill. This is an example of:

C. an off-invoice allowance. The above scenario is an example of an off-invoice allowance. Off-invoice allowance means a certain per-case amount or percentage is deducted from the invoice.

Got Game, a sports store, ran a promotion campaign in which it offered a box of fifteen Pyramid golf balls at the price of twelve. This is an example of a:

C. bonus pack. The above scenario is an example of a bonus pack. Bonus packs offer the consumer an extra amount of a product at the regular price by providing larger containers or extra units. Bonus packs result in a lower cost per unit for the consumer and provide extra value as well as more product for the money.

With reference to the various sampling methods, _____ is used when it is important to control where the sample is delivered and when the products are of a perishable nature.

C. door-to-door sampling. Door-to-door sampling, in which the product is delivered directly to the prospect's residence, is used when it is important to control where the sample is delivered. This distribution method is very expensive because of labor costs, but it can be cost-effective if the marketer has information that helps define the target market and/or if the prospects are located in a well-defined geographic area.

One of the main types of on-package coupons is the _____ coupon, which is attached to the outside of the package so the consumer can rip it off and redeem it at the time of the purchase.

C. instant. A type of package coupon is the instant coupon, which is attached to the outside of the package so the consumer can rip it off and redeem it immediately at the time of purchase. Instant coupons have the highest redemption levels of all types of coupons, averaging around 20 percent for food products and 27 percent for nonfood items.

Which of the following statements about event sponsorships and event marketing is true?

D. Event sponsorship objectives are often part of an organization's public relations activities. An event sponsorship is an integrated marketing communications activity where a company develops actual sponsorship relations with a particular event and provides financial support in return for the right to display a brand name, logo, or advertising message and be identified as a supporter of the event. Decisions and objectives for event sponsorships are often part of an organization's public relations activities.

Which of the following is a limitation of door-to-door sampling?

D. It involves high labor costs. Door-to-door sampling, in which the product is delivered directly to the prospect's residence, is used when it is important to control where the sample is delivered. This distribution method is very expensive because of labor costs, but it can be cost-effective if the marketer has information that helps define the target market and/or if the prospects are located in a well-defined geographic area.

Kiddo Inc., a toy manufacturer, teamed with Game On, a retailer, to create direct-mail booklets offering discounts on Kiddo toys only at Game On stores. This is an example of:

D. account-specific marketing. The above scenario is an example of account-specific marketing. A major development in recent years is account-specific marketing (also referred to as comarketing), whereby a manufacturer collaborates with an individual retailer to create a customized promotion that accomplishes mutual objectives.

In _____ sampling, a marketer hires temporary demonstrators who set up a table or booth within an outlet, prepare small samples of a product, and pass them out to shoppers.

D. in-store. In in-store sampling, a marketer hires temporary demonstrators who set up a table or booth, prepare small samples of the product, and pass them out to shoppers. The in-store sampling approach can be very effective for food products, since consumers get to taste the item and the demonstrator can give them more information about the product while it is being sampled.

100. Payments offered by manufacturers to retailers for merchandising products or running special in-store programs are called:

D. promotional allowances. Manufacturers often give retailers allowances or discounts for performing certain promotional or merchandising activities in support of their brands. These are known as promotional allowances. These merchandising allowances can be given for providing special displays away from the product's regular shelf position, running in-store promotional programs, or including the product in an ad.

Which of the following is an advantage of the sampling method of sales promotion?

E. Consumers gain a greater appreciation for a product's benefits. Sampling generates much higher trial rates than advertising or other sales promotion techniques. Getting people to try a product leads to a second benefit of sampling: Consumers experience the brand directly, gaining a greater appreciation for its benefits. This can be particularly important when a product's features and benefits are difficult to describe through advertising.

True or False. When a brand moves to the maturity stage, advertising is primarily used as a reminder to keep consumers aware of the brand.

TRUE When a brand moves to the maturity stage, advertising is primarily a reminder to keep consumers aware of the brand.

_____ coupons are in/on-pack coupons that are redeemable on the purchase of a different product, usually one made by the same company, but occasionally through a tie-in with another manufacturer.

B. Cross-ruff. One of the in/on-pack coupons is the cross-ruff coupon, which is redeemable on the purchase of a different product, usually one made by the same company but occasionally through a tie-in with another manufacturer.

Which of the following is true of in-store couponing?

B. It is typically distributed through checkout counters. One popular way to distribute in-store coupons is through electronic devices such as kiosks or at the checkout counter. When the specified product, such as a competitive brand, is purchased, the consumer receives a coupon at the checkout for the company's brand.

75. Which of the following is a limitation of using in-store sampling?

B. It requires the cooperation of retailers. In-store sampling is increasingly popular, especially for food products. The marketer hires temporary demonstrators who set up a table or booth, prepare small samples of the product, and pass them out to shoppers. While this sampling method can be very effective, it can also be expensive and requires a great deal of planning, as well as the cooperation of retailers.

Which of the following is an example of a trade-oriented sales promotion activity?

D. Dealer contests. Trade-oriented sales promotion includes dealer contests and incentives, trade allowances, point-of-purchase displays, sales training programs, trade shows, cooperative advertising, and other programs designed to motivate distributors and retailers to carry a product and make an extra effort to push it to their customers.

Electronically dispensed checkout coupons:

D. are cost-effective and can be targeted to specific categories of consumers. Major advantages of electronically dispensed checkout coupons are that they are cost-effective and can be targeted to specific categories of consumers, such as users of competitive or complementary products.

In a(n) _____ sampling, a multiproduct firm attaches the sample to an existing item of the firm.

D. on-package. In an on-package sampling, a multiproduct firm attaches a sample of a new product to an existing item of the firm. This procedure can be very cost-effective.

When reductions from the regular price of a product are offered at the point-of-purchase through specially marked packages, a marketer is using a:

E. price-off deal. Price-off reductions are typically offered right on the package through specially marked price packs. Typically, price-offs range from 10 to 25 percent off the regular price, with the reduction coming out of the manufacturer's profit margin, not the retailer's. Keeping the retailer's margin during a price-off promotion maintains its support and cooperation.

Some businesspeople think that the packaged-goods brand management system has contributed to marketers' increased dependence on:

E. sales promotion. Many businesspeople believe the increase in sales promotion is motivated by marketing plans and reward systems geared to short-term performance and the immediate generation of sales volume. Some businesspeople think that the packaged-goods brand management system has contributed to marketers' increased dependence on sales promotion. Brand managers use sales promotions routinely, not only to introduce new products or defend against the competition but also to meet quarterly or yearly sales and market share goals.

True or False. In order to integrate advertising and sales promotion programs successfully, the theme of consumer promotion need not be tied in with the positioning platform for the company and/or its brand.

FALSE In order to integrate the advertising and sales promotion programs successfully, the theme of consumer promotion should be tied in with the positioning platform for the company and/or their brand wherever possible.

True or False. Media support for a sales promotion program is typically considered optional.

FALSE Media support for a sales promotion program is critical and should be coordinated with the media program for the ad campaign.

True or False. Sales promotions are typically not considered a part of the IMC planning process.

FALSE While sales promotion has been part of the marketing process for a long time, its role and importance in a company's integrated marketing communications program have increased dramatically over the past decade.

True or False. A sales promotion spiral can result when several competitors use promotions extensively.

TRUE A potential problem with consumer-oriented promotions is that a sales promotion trap or spiral can result when several competitors use promotions extensively.

Which of the following serves as a reason for the increase in sales promotion?

A. Growing power of retailers. There are a number of other factors that have led to the increase in the importance of sales promotion and the shift in marketing dollars from media advertising to consumer and trade promotions. Among them are the growing power of retailers, declining brand loyalty, increased promotional sensitivity, brand proliferation, fragmentation of the consumer market, the short-term focus of many marketers, increased accountability, competition, clutter, and the growth of digital and social media.

Which of the following is a disadvantage of couponing?

A. It can be difficult to estimate how many consumers will use a coupon and when. There are a number of problems with coupons. First, it can be difficult to estimate how many consumers will use a coupon and when. Response to a coupon is rarely immediate; it typically takes anywhere from two to six months to redeem one.

Which of the following is a limitation of using on-package sampling?

A. It will not reach nonusers of the carrier brand. On-package sampling, where a sample of a product is attached to another item, is a common sampling method. This procedure can be very cost-effective, particularly for multiproduct firms that attach a sample of a new product to an existing brand's package. A drawback is that since the sample is distributed only to consumers who purchase the item to which it is attached, the sample will not reach nonusers of the carrier brand.

Several different manufacturers of personal computers (PCs) have joined to create and sponsor ads that promote both the computer and the microprocessor by sharing the cost of advertising. The PC manufacturers are using:

A. cooperative advertising. In the above scenario, the PC manufacturers are using cooperative advertising. One form of trade-oriented promotion we examine is cooperative advertising, where the cost of advertising is shared by more than one party.