Marketing Chapter 8
In contrast to the buying center in a firm which tends to operate more on an informal basis, _____________ are formally tasked by management to engage in the decision process for risky and expensive products or services that may be purchased by the firm. Purchasing agents Purchasing managers Buying committees Buying centers Logistics managers
Buying committees
Procter & Gamble targeted Olean advertising directly at consumers when it first introduced its brand of olestra, even though the product was not available in consumer markets. P&G understood that if consumers were convinced of Olean's benefits as a substitute low fat cooking oil that could actually lower the fat content in foods, they would demand that Olean be incorporated into other products, such as chips and other snacks. This example illustrates which characteristic of organizational markets and supply chains? Demand for organization products is "derived demand" Demand tends to be price inelastic for organizational products The close relationship between buyers and sellers in supply chains The use of NAICS to characterize organizational markets
Demand for organization products is "derived demand"
Consumer demand for personal computers or smart devices ultimately determines the demand for the parts and materials involved in the manufacture of each product. This is an example of ________ . Channel management Price elasticity of demand Derived demand B2B demand None of the above
Derived demand
Which of the following is not among the types of buying decisions made within organizations? Dynamic rebuy Straight rebuy Modified rebuy New Task
Dynamic rebuy
Melissa is an engineer with Peterbuilt and regularly participates with others to determine specifications for parts and materials that will be used in Peterbuilt's production processes. Melissa' role in the buying center at Peterbuilt is that of a(an): Initiator Gatekeeper Influencer Decider Purchasing agent
Influencer
Supervisory personnel, research and design specialists, and engineers who assist in determining specifications and defining other criteria for use during the purchase decision-making process usually perform which role in the buying center? User Gatekeeper Influencer Decider Initiator
Influencer
In some cases, governmental agencies may use mailing lists of firms that have previously contacted governmental buying offices and indicated their desire to be included in future solicitations. Based on these mailing lists, ______________ are sent directly to interested firms. Request for proposals Invitations to bid Contract applications Specification summaries Invitations to quote
Invitations to bid
In which type of market do firms purchase a wide range of parts, raw materials and, often, services that are used to produce new products, Business user market Services market Government market Manufacturer market Other producers market
Manufacturer market
____________ is the upper limit of the demand for specific goods or services that exists within a particular industry. It represents the amount of a product that potentially could be sold by all firms (taken together) in an entire industry. Market demand Sales forecast Sales potential Market potential Market boundary
Market potential
A manufacturer has upgraded its assembly line to one that uses automated, robotic equipment. The decision was time consuming and complex. However, given the valuable experience decision makers compiled from this decision, future decisions to upgrade the line should not be so extensive. These future decisions probably will fall into which buy class? B2B buying decision Modified rebuy decision New task decision Straight rebuy decision B2C decisions
Modified rebuy decision
James is a purchasing agent for Peterbuilt and has responsibility for purchasing and stocking MRO items employed to maintain Peterbuilt's office facilities. James normally automatically reorders from the same vendors when supplies run low. However, the current vendor has not been performing as expected. Deliveries have been delayed and quality of some items has not been up to speed. James probably will initiate a(n): B2B buying decision Modified rebuy decision New task decision Straight rebuy decision B2C decisions
Modified rebuy decision
The US Navy when it buys new ships or other weapons systems will most likely employ which form of governmental buying? Standard bid buying Negotiated contracting Systems contracting MRO contracting None of the above
Negotiated contracting
The Central Intelligence Agency wishes to improve the security of its global communications in light of the recent extensive hacking of supposedly secure systems. There are only a few firms that are qualified to build such systems. The CIA probably will employ which form of government buying? Requests for proposals Invitations to bid Requests for bids Negotiated contracts
Negotiated contracts
____________ are used by the federal government for the purchase of complex products that must be custom designed for specialized government applications. These products often require extensive research, development, and custom tailoring to satisfy government needs. Negotiated contracts Requests for proposals Invitations to bid Invitations to quote
Negotiated contracts
Decisions in organizations for complex, high-risk, first-time purchases of major equipment and production installations fall into which buy class? Dynamic rebuy Straight rebuy Modified rebuy New Task
New Task
Acquiring information about alternative vendors and products during the organizational decision process is probably is most difficult for: B2B buying decisions Modified rebuy decisions New task decisions Straight rebuy decisions B2C decisions
New task decisions
Organizations such as churches, universities, hospitals, charities, and political parties are generally classified in which organizational market? Manufacturer Other producer Government Reseller Non-business
Non-business
Products purchased for use in business operations, or for resale to other organizations, or as a part employed in the production or another product are referred to as: Consumer products Business products Corporate products Organizational products Integrated products
Organizational products
When products are purchased that will be used to operate an organization or will be made into products, these products are called ______________ . Consumer products Business products Corporate products Organizational products Integrated products
Organizational products
When BP buys drilling equipment and ships for the exploration, extraction, and shipment of oil it is in which type of organizational market? Manufacturer Other producer Government Reseller Non-business
Other producer
Lumber companies, such as Weyerhaeuser, that buy trucks, bulldozers, and other equipment for forest harvesting and milling are engaged in the production of lumber products that will be sold commercially. Such companies are categorized as _______________ . Manufacturers Other producers or business users Service organizations Oligopolies None of the above
Other producers or business users
When total revenue (price x quantity sold) increases as price decreases, demand is said to be ____________ . Stagnant Price elastic Price inelastic Price sensitive Greater than the supply of the product in question
Price elastic
_____________ measures how much the demand for a product changes (up or down) as the price for that product increases or decreases. Price elasticity of demand Consumer price sensitivity Supply and demand ratios Market elasticity Market price responsiveness
Price elasticity of demand
Due to shortages in raw materials, all firms in the micro-chip industry increased their prices to their customers. Yet demand for chips did not change. This suggests that the demand for micro-chips is _____________ under these conditions. Price elastic Price inelastic Stable Predictable None of the above
Price inelastic
When total revenue (price x quantity sold) decreases as price decreases, demand is said to be ____________ . Stagnant Price elastic Price inelastic Price sensitive Greater than the supply of the product in question
Price inelastic
The demand for goods and services produced by an entire industry tends to be _______________ ; while the demand for goods and services produced by individual firms within that same industry tends to more ____________. Price elastic; price inelastic Price inelastic; price elastic Increasing; decreasing Price sensitive; price insensitive Price insensitive; price sensitive
Price inelastic; price elastic
Which of the following is not a role performed in a firm's buying center? Initiator Gatekeeper Influencer Decider Purchasing agent
Purchasing agent
In a firm's buying center, the deciders for products purchased on straight rebuy bases generally are _________ . Upper-level managers Engineers and research personnel Administrative assistants within departments that use these kinds of products Purchasing agents None of the above
Purchasing agents
A furniture manufacturer may choose to buy wood and other materials from a producer who, in turn, agrees to furnish its office with furniture produced by the manufacturer. This situation is an example of ___________ . Exchange partnering Reciprocity Supply chain negotiation Integrated buying and selling None of the above
Reciprocity
Governmental agencies normally use ___________to solicit qualified suppliers to submit bids for needed products and services. The request typically contains all purchasing requirements, specifications, and deadlines that must be satisfied. Requests for bids Negotiated contracts Request for quotes Requests for proposals Invitation to quote
Requests for proposals
The Department of the Navy in its efforts to better equip its SEAL teams to fight the global war on terrorism want to design a silent, maneuverable, defensible underwater delivery system. There are only a few firms that are qualified to build such systems. The Navy will probably employ negotiated contracting for the purchase and will initiate the process using: Requests for quote Request for proposals Invitations to bid Invitations to quote
Requests for quote
Wholesaling middlemen and retailers are considered to be part of the _____________ organizational market. Reseller Producer Government "Non-Business" Supply chain
Reseller
__________ normally do not transform products in any way. Usually, products are sold to the next supply chain member without any modification. Manufacturers Resellers Business users Government Non-profit organizations
Resellers
During which stage of the organization decision process for products is a supplier most likely to deliver a formal presentation to the organization? Problem recognition Identify specifications Searching for and qualifying vendors Soliciting proposals Analyzing proposals
Soliciting proposals
Decisions for organizational products that are usually made by purchasing agents and for which the purchase order may simply be placed with existing vendors that usually supplies these products is the: Dynamic rebuy Straight rebuy Modified rebuy New Task
Straight rebuy
James is a purchasing agent for Peterbuilt and has responsibility for purchasing and stocking MRO items employed to maintain Peterbuilt's office facilities. James normally automatically reorders from the same vendors when supplies run low. This is an example of what type of organization purchase decision? B2B buying decision Modified rebuy decision New task decision Straight rebuy decision Vendor acquisition decision
Straight rebuy decision
With the searching for and qualifying vendors stage of the organizational decision process, vendors are often selected from pre-approved vendor lists. This probably is most often encountered with: B2B buying decisions Modified rebuy decisions New task decisions Straight rebuy decisions B2C decisions
Straight rebuy decisions
___________ are comprised of linked organizations through which products are sourced, manufactured or assembled, and finally, transported, inventoried, delivered and ultimately sold to end-use consumers. Supply chains Supply pipelines Product pipelines Reseller systems Reseller chains
Supply chains
Organizational buyers often seek to purchase "total solutions" to their procurement problems by contracting with a single vendor who, may in turn, subcontract aspects of the contract to other vendors. This trend is called __________ . Solutions contracting System buying Solutions procurement Systems selling Solutions selling
System buying
When the US Navy contracts with a single weapons system manufacturer for a new complex carrier defense system and that manufacturer subcontracts production of some components of the system to other manufacturers, the Navy is engaging in ________________ . Solutions contracting System buying Solutions procurement Systems selling Solutions selling
System buying
Organizational buyers benefit from __________ because it substantially reduces the cost of maintaining inventory of MRO items, reduces the time spent on supplier selection decisions, and offers price protection over the term of the contract. Systems contracting Systems buying Systems selling MRO contracting MRO solutions buying
Systems contracting
UNT typically procures its entire supply of Maintenance, Repair, and Operating (MRO) items, requiring that the supplier track inventory and automatically restock items as required. UNT has engaged in: Systems contracting Systems buying Systems selling MRO contracting MRO solutions buying
Systems contracting
_______________ applies to marketing supplies of Maintenance, Repair, and Operating (MRO) items. Firms contract with suppliers of these items to provide for their entire MRO needs. Systems contracting Systems buying Systems selling MRO contracting MRO solutions buying
Systems contracting
Assume the US Navy contracts with a single weapons system manufacture for a new complex carrier defense system and that manufacturer subcontracts production of some components of the system to other manufacturers. Manufacturers that provide these contracting services to the Navy are said to be engaged in: Solutions contracting System buying Solutions procurement Systems selling Solutions selling
Systems selling
Organizational buyers often seek to purchase "total solutions" to their procurement problems by contracting with a single vendor who, may in turn, subcontract aspects of the contract to other vendors. Vendors who provide such services are said to be engaged in: Solutions contracting System buying Solutions procurement Systems selling Solutions selling
Systems selling
Which of the following would not be considered as an example of an organizational market? A farmer purchases a tractor for use on his or her farm Exxon purchases the services of professional divers to service its oil rigs in the Gulf The Defense Intelligence Agency contracts with L3, a firm that specializes in security services, to provide personnel for night-time security in its headquarters facility in Virginia The CEO of Home Depot buys appliances for his personal residence Best Buy contracts with Apple computer to provide repair services for Apple products as part of its Geek Squad service.
The CEO of Home Depot buys appliances for his personal residence
Which of the following is least characteristic of the purchasing decisions classified as new task? Product under consideration are high risk, first time purchases of major equipment Members of the buying center lack significant experience with the specific products or services under examination Much information and a number of alternative products and vendors are usually examined The decision process is generally quick and often dominated by purchasing agents The decision is likely to be delegated to a buying committee
The decision process is generally quick and often dominated by purchasing agents
Which of the following is not true of the NAICS coding system? The system was established by states to allow each individual state to classify businesses within its borders Divides all business organizations into 20 industry sectors NAICs is replacing the older SIC system NAICS codes can contain 5 or more digits NAICS codes can help marketers identify potential customers for their products.
The system was established by states to allow each individual state to classify businesses within its borders
Which of the following is least likely true of straight rebuy decisions in organizations? Tend to be simple, recurring purchases of office supplies, parts and materials, and utilities Top management directs the decision process Firms generally possess substantial past experience for guiding how decisions should unfold Fewer people tend to be involved Decisions may be made by purchasing agents
Top management directs the decision process
During the Identify Specifications stage of the organizational decision process products and their component parts may be critically evaluated by both the firm and its suppliers with respect to function and design in order to improve quality and, at the same time, lower production and parts/ material costs. This process is known as: Cost engineering Value analysis Component optimization Cost optimization Cost analysis
Value analysis
___________ is employed by manufacturers and their suppliers to reduce or control the costs of component parts and other materials via a careful study of how processes, procedures, and parts might be redesigned and/or standardized across a range of products the manufacturer may produce. Cost analysis Process innovation Value analysis Marketing research None of the above
Value analysis
Bill works at Peterbuilt on the assembly line producing truck frames. Bill is exceptionally knowledgeable about the equipment needed to do his job and often makes recommendations to management on the specifications for and alternative suppliers of needed equipment. Given Bill's position on the assembly line as an operator, he probably functions in the buying center at Peterbuilt as a(n): User Initiator Influencer Decider a, b, and c above
a, b, and c above
Organizational buyers are more likely to buy direct from the manufacturers of products when: The products are essentially supplies used up in daily operations The same products are available from a large number of competing sellers The products are complex and expensive pieces of equipment that may require custom design and installation. The organizational buyer purchases in very large volumes c and d above
c and d above
For routine purchases, such as purchases of office supplies and cleaning supplies, lists of approved buyers may exist based on prior experience with these sellers. Government agencies may directly purchase from firms on these lists without soliciting additional bids. However, the size of the order is generally limited to under __________ for the federal government. $10,000 $5,000 $3,000 $2,500 $2,000
$2,500
The stage of the organizational decision process in which proposals are compared against one another and against the specifications is the __________ stage. Problem recognition Identify specifications Searching for and qualifying vendors Soliciting proposals Analyzing proposals
Analyzing proposals
With respect to the buying center in a firm, personnel who actually operate equipment that may be purchased probably perform which role in the buying center? User Gatekeeper Influencer Decider a and c above
a and c above
Best Buy provides its "Geek Squad" service to support sales of its computers and software. Providing such "value-added" to customers helps accomplish which of the following? Helps differentiates Best Buy from competing resellers Provides Best Buy with a source of competitive advantage Generates added sales revenue Allows Best Buy to better compete with Internet resellers All of the above
All of the above
The fact that both SIC and NAICS codes group similar companies together allows marketers to use these codes to: Treat some SIC and NAICS categories as market segments for their products To directly target individual firms possessing a given code by cross-referencing SIC or NAICs with lists of companies possessing those codes obtained from other secondary data sources To estimate the market potential for their products by combining data from SIC or NAICS with data from other secondary data sources that identify specific firms possessing the proper SIC or NAICS codes. All of the above Only b and c above
All of the above
Which of the following is characteristic of the modified rebuy in organizational purchasing? A limited number of alternative products and/or vendors will be considered The decision is generally triggered by a change in some environmental event "Out suppliers" may try to trigger the modified rebuy by attempting to get buyers to consider the merits of their offerings over the merits of products currently used Can evolve from purchases that previously were new task or straight rebuy All of the above
All of the above
Which of the following should be done by marketers wishing to become suppliers of goods and services to organizational buyers? Getting listed in trade directories that serve the buyer's industry Employing aggressive promotion in media targeted to buyers in the industry to ensure their presence is made known Employing aggressive B2B sales programs that complement other promotion initiatives Promoting positive word-of-mouth, which is best generated by keeping existing customers satisfied All of the above
All of the above
The role in the buying center that typically arranges the specific details of the purchase, potentially negotiates specific terms of the contract, processes the paper work, monitors progress on delivery, and engages in any expediting that may be required is a(n): Buyer Gatekeeper Influencer Decider Purchasing agent
Buyer
The ____________ in organizations consists of all people involved in the decision making process, formally or informally, for products and services that may be purchased by the firm. urchasing agents Purchasing managers Buying committees Buying centers Logistics managers
Buying centers
What publication produced by the federal government is used to provide information to prospective suppliers on potential upcoming contracts for which they can bid? Federal Contract Register Commerce Business Daily General Services Administration Bulletin Contract Opportunities with Federal Agencies Wall Street Journal
Commerce Business Daily
Products purchased by individuals for their own personal or household use are called: Consumer products Business products Corporate products Organizational products Integrated products
Consumer products
Melissa is a member of management with Peterbuilt and regularly participates with others to evaluate and choose among alternative vendors being considered as suppliers of equipment, parts, and materials. Melissa' role in the buying center at Peterbuilt is that of a(an): Initiator Gatekeeper Influencer Decider Purchasing agent
Decider
Individual firms in an industry usually cannot successfully raise prices for their products if other firms in the industry do not follow suit. If only one firm raised its prices it probably would result in buyers of the firm's products shifting their purchases to competing sellers. Any single firm that raises price will suffer a decline in sales. This scenario reflects the fact that: Demand at the industry level tends to be price inelastic while demand for the products made by individual firms in that industry is price elastic Demand at the industry level tends to be price elastic while demand for the products made by individual firms in that industry is price inelastic Supply of products in the industry is greater than the demand for those products Demand for the products produced by firms in the industry is greater than the supply of those products
Demand at the industry level tends to be price inelastic while demand for the products made by individual firms in that industry is price elastic
Monsanto targeted NutraSweet advertising directly at consumers when it first introduced the product in the early 1980s, even though the product was not available in consumer markets. Monsanto understood that if consumers were convinced of NutraSweet's benefits as a substitute for sugar, they would demand NutraSweet in other products. This example illustrates which characteristic of organizational markets and supply chains? Demand for organization products is "derived demand" Demand tends to be price inelastic for organizational products The close relationship between buyers and sellers in supply chains The use of NAICS to characterize organizational markets
Demand for organization products is "derived demand"
__________ means that the demand for organizational goods and services is ultimately a function of the demand for consumer goods and services. Channel management Price elasticity of demand Derived demand B2B demand None of the above
Derived demand
Which of the following is not considered a type of organizational market? Resellers who buy products for resale to others Manufacturers who buy goods and services for producing other products "Business users" who buy products to aid in running the operations Governmental agencies buying goods and service to maintain government operations. Employees of non-profit organizations who buy products for personal consumption.
Employees of non-profit organizations who buy products for personal consumption.
Sellers of organizational products generally try to ultimately target key decision makers with their sales presentations. However, they must first get through the various clerks, administrative assistants, and lower-level purchasing personnel who are performing which role in the buying center? User Gatekeeper Influencer Decider Initiator
Gatekeeper
The role in the buying center that tends to control the flow of information between personnel in the buying center is: User Gatekeeper Influencer Decider Initiator
Gatekeeper
Value analysis is most likely to occur at which stage in the organizational decision process for products? Need recognition Identification of specifications Search for vendors Analyzing proposals Supplier selection
Identification of specifications
With respect to straight rebuy decision for office or janitorial supplies, all that may be required is identification of quantities needed. Which stage of the purchasing decision process is implied? Need recognition Identification of specifications Search for vendors Analyzing proposals Supplier selection
Identification of specifications
