MARKETING 10

vertical marketing system

A ________ consists of producers, wholesalers, and retailers acting as a unified system. The system can be dominated by any one of the interdependent members.

value delivery network

A ________ is made up of a company, its suppliers, distributors, and, ultimately, customers who "partner" with each other to improve the performance of the entire system.

horizontal marketing system

A channel arrangement in which two or more companies at one level join together to follow a new marketing opportunity is referred to as a(n) ________.

the company Web site

A firm that uses direct marketing would most likely sell its products through ________.

wholesaler

A(n) ________ is considered a marketing intermediary.

information flow

All the institutions in a channel are connected by several types of flows. When a retailer conveys to a wholesaler that a new line of hip-hop clothing is not selling, this is an example of ________.

disintermediation

Changes in technology and the explosive growth of direct and online marketing are having a profound impact on the nature and design of marketing channels. One major trend is toward ________ insofar as product or service producers cut out intermediaries and go directly to final buyers or when radically new types of channel intermediaries displace traditional ones.

multichannel distribution system

Faber Motors manufactures three lines of cars: high-end security cars for government agencies, commercial cars for consumers and individuals, and professional racing cars. The high-end security cars are sold directly to government buyers by the company. The consumer cars are sold through dedicated dealers who only sell Faber's lines at their outlets. For its professional racing cars, Faber collaborates with Radium Tires, an innovative and renowned tire manufacturer. Faber provides the engine and body, while Radium provides the tires and its expertise on the racing industry. Which term best describes Faber's channel arrangements?

disintermediation

For over 10 years, Erudite, a publishing and educational company that produces college textbooks, has been selling its books online through studysmart.com, a popular online retailer that sells textbooks published by different companies. Recently, Erudite stopped selling its books through studysmart.com and set up its own Web site to sell its books. This change in channel organization is called ________.

exclusive

High-end luxury brands like Bentley for cars, Louis Vuitton for handbags, and Rolex for watches use ________ distribution, giving a limited number of dealers the sole right to sell products in a specified geographic territory.

administered vertical

In a(n) ________ marketing system, leadership over production and distribution is assumed through the size and power of one or a few dominant channel members.

a direct marketing channel

In which of the following situations is a producer guaranteed full control over product sales?

a contractual marketing system

Java Jane's first coffeehouse was very successful due to the unique flavors, on-site baked goods, and inviting ambiance. The owner, Jane Phillips, decided to franchise her operation when she was approached by several interested investors. Which type of marketing system has Java Jane's most likely adopted?

a conflict between two Greystone Motors car dealerships

Jupiter Steel is the chief provider of metals to Greystone Motors. Greystone Motors has two models of cars - one for commercial and regular consumers and another for professional car racing teams. Greystone Motors has designated dealers to sell its commercial cars to consumers, while racing cars are sold directly to the racing teams. In such a distribution channel, which of the following would be considered a horizontal conflict?

Abundon

Kevin Pinker is a freelance computer programmer who writes computer algorithms for companies such as SoftStar and BlueHill. SoftStar and BlueHill use these algorithms to make specific programs based on online market research. These programs are then sold to the online retailer, Abundon, which then sells them to individual consumers and businesses. Which of the following is a marketing intermediary in this chain?

a contractual vertical marketing system

Luccia's is a restaurant based in Illinois that exclusively sells Italian food. Luccia's sells the rights to its recipes to a British firm, Clover Trading, which then opens an outlet in London under the Luccia's brand name. Which kind of channel arrangement does Luccia's most likely have with Clover Trading?

exclusive dealing

Many athletic stadiums enter into contractual agreements with national beverage companies and food franchises to distribute only their brand-name products at the respective venues. This is an example of ________.

direct

Mary Kay Cosmetics and Amway sell their products through home and office sales parties, online Web sites, and social media. Both companies use a(n) ________ channel to distribute their offerings.

a conflict between Performance Inc. and The Sneaker Store

Performance Inc. sells its newest athletic shoe styles to The Sneaker Store and distributes dated or slightly defective merchandise through Sports Discounters. Performance Inc.'s main competitor is Topnotch Manufacturers. Performance Inc. also markets its products through the company Web site. They decide to offer a short-term online promotion to encourage consumers to buy their newest athletic shoes, promoting a 20 percent discount off current retail prices. In such a distribution channel, which of the following would be considered a vertical conflict?

intensive

Producers of convenience products and common raw materials typically seek ________ distribution - a strategy in which they stock their products in as many outlets as possible

create greater efficiency in making goods available to target markets

Producers use marketing intermediaries because they ________.

manufacturer-sponsored retailer franchise system

Rage, a leading motor vehicle manufacturer, introduces a new superbike model. It invites proposals from independent dealers who are willing to set up exclusive showrooms that only sell Rage's superbikes. Chosen dealers will sell and service the superbikes, and Rage will oversee national advertising. This is most likely an example of a(n) ________.

more than one, but fewer than all, willing intermediaries are used by a seller

Selective distribution is a strategy in which ________.

administered vertical marketing system

Sonic Shack, an audio equipment retailer, signs an agreement with PineWire, a renowned electronics company, to sell PineWire products. The deal requires Sonic Shack to provide PineWire products with superior displays, shelf space, and promotion compared to competing products. Sonic agrees to these terms as PineWire products command a huge share in the market. Which of the following types of channel arrangements do PineWire and Sonic Shack most likely have?

"demand chain"

The authors suggest that the term "supply chain" may be too limited because it takes a "make-and-sell" view of the business. They believe the term ________ is more appropriate because it suggests a "sense-and-respond" view of the market.

different levels of the same channel

Vertical conflicts in distribution channels are conflicts that occur between ________.

multichannel distribution system

Victoria's Closet, a manufacturer of bohemian-style clothing and accessories, sells its products through its online Web site, a catalogue, and specialty boutiques that target women. Which kind of channel arrangement does Victoria's Closet employ to distribute its products?

exclusive distribution

When a seller requires that only certain dealers carry its products, its strategy is known as ________.

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

Which of the following applies to a marketing intermediary who buys brand name toothpaste from 10 different manufacturers, consolidates offerings, and then resells the various brands to 500 supermarkets in Florida?

The seller's distinctive position is reinforced through customer service and the dealer obtains steady support from the seller.

Which of the following is an advantage of exclusive dealing between a seller and a dealer?

a Ford car dealer complaining that another Ford dealer is underpricing the same models

Which of the following is an example of a horizontal conflict in a distribution channel?

It has each channel member acting as a separate business unit trying to maximize its own profits.

Which of the following is true of a conventional distribution channel?

It has one channel member owning all the other channel members or has contracts with all other channel members.

Which of the following is true of a vertical marketing system?

It does not allow other producers to sell to that dealer.

Which of the following is true of an exclusive dealing arrangement between a producer and a dealer?

It strives to make products available where and when consumers want them.

Which of the following is true of an intensive distribution strategy?

a firm that provides technical expertise in the production of a product

Which of the following would be considered an upstream partner in a company's supply chain?

administered vertical marketing system

Which type of channel arrangement is a retailer like Home Depot likely to follow?

Marketing channels

________ are sets of interdependent organizations that help make the product or service of a company available for use by consumers or business users.

Selective

________ distribution typically allows manufacturers to develop good working relationships with intermediaries and expect a better-than-average selling effort. It also gives producers good market coverage with more control and less cost than intensive distribution.

Full-line forcing

________ is a practice whereby a producer agrees to sell a brand to a dealer only if the dealer agrees to sell some or all of the rest of the producer's merchandise.