Marketing exam 2

(9) T/F: The Value and Lifestyle Survey (VALS) conducted by Strategic Business Insights (SBI) is a widely used tool for geographic segmentation.

False

One reason auto companies spend millions on racing cars is that they offer the opportunity to test new designs and technology under extreme conditions. Using the cars in a real-use setting provides an opportunity for ________ the product. 1) pretesting 2) beta testing 3) test marketing 4) alpha testing 5) concept testing

beta testing

Marketers with successful brands sometimes hesitate to expand their brands because 1) Federal Trade Commission regulations limit the number of products that can be marketed under an individual brand name. 2) it is costly to maintain many product lines, and it might weaken the brand's meaning. 3) it is often difficult to get additional marketing communications coverage for the brand. 4) manufacturing divisions usually control brand expansion and are often in conflict with the marketing division. 5) the current economy can support only a limited number of product options.

it is costly to maintain many product lines, and it might weaken the brand's meaning.

The complete set of all products offered by a firm is called its 1) product line. 2) product categories. 3)product mix. 4) product breadth. 5) product line depth.

product mix

(13) T/F: Distributive fairness pertains to a customer's perception of the benefits received compared to the costs of the inconvenience or loss.

True

(13) T/F: The communication gap can be reduced by managing customer expectations.

True

(13) T/F: The zone of tolerance refers to the area between customers' expectations regarding their desired service and the minimum level of acceptable service.

True

(9) Fiona is trying to determine whether the segments she is considering for her day care center will be profitable. Which of the following will specifically help her in this analysis? 1) the number of children needing day care in the immediate area 2) the number of sports programs available for teenagers 3) the percentage of parents in the area who home school their children 4) the average number of school-age children in families sending a child to the day care center 5) the number of new births predicted in the next decade

the number of children needing day care in the immediate area

(9) After assessing the market growth potential in Brazil for his company's baby products, Jaime wanted to evaluate market competitiveness. To do this, Jaime would consider 1) mass marketing of distribution potential and logistical support. 2) the current size of the market and the expected growth rate. 3) ease of pricing control and number of promotional outlets. 4) the number of competitors, entry barriers, and product substitutes. 5) profitability and customer buying behavior.

the number of competitors, entry barriers, and product substitutes.

(13) T/F: In training service providers, service quality goals should be general to allow for the various needs of consumers.

False

(8) T/F: Entering into a global franchise agreement exposes a company to higher risk than if the company had entered into direct investment in the country.

False

(8) T/F: Global distribution networks that involve wholesalers, exporters, importers, and different transportation systems generally lower costs and prices for products.

False

(8) T/F: Tariffs artificially lower prices and make goods more competitive.

False

(8) Domestic firms developing a global entry strategy might consider franchising; however, the disadvantages need to be considered. Which of the following is a disadvantage of franchising? 1) A foreign nation will want to be a cofranchisee 2) The franchisee will never become a competitor 3) Franchising limits profit potential, since profits will have to be split with the franchisee 4) Franchising is the riskiest way to enter a foreign market 5) The Franchisee is tied to the agreement for the lifetime of the franchise

Franchising limits profit potential, since profits will have to be split with the franchisee

(9) T/F: For products like sugar or pepper, marketers should probably use an undifferentiated targeting strategy.

True

(9) T/F: Giant Food Stores in suburban Washington, DC, adjusts its ethnic food aisle offerings based on the ethnic groups living near each store. Giant Foods is using geodemographic segmentation.

True

The Service Gaps Model is designed to highlight those areas where 1)service providers provide the best possible service. 2) manufacturers are cutting corners on product quality. 3) customers believe they are getting less or poorer service than they should. 4) service providers know more than their customers. 5) delivered service exceeds expected service.

customers believe they are getting less or poorer service than they should

Marketers with luxury brands use brand extension cautiously in order to avoid 1) brand licensing fees. 2) exclusive cobranding arrangements. 3) diluting the core brand. 4) private-label branding disputes. 5) product line extension limitations.

diluting the core brand

(9) After assessing the market growth potential and market competitiveness in Brazil for his company's baby products, Jaime wanted to evaluate market access. To do this, Jaime would consider 1) ease of accessing or developing distribution channels and brand familiarity. 2) the current size of the market and the expected growth rate. 3) ease of pricing control and number of promotional outlets. 4) the number of competitors, entry barriers, and product substitutes. 5) profitability and customer buying behavior.

ease of accessing or developing distribution channels and brand familiarity.

(9) The first step in the STP process is to 1) identify the segmentation methods to be used. 2) produce a list of strengths and weaknesses of the firm's past marketing strategies. 3) establish the overall strategy or objectives. 4) select target markets. 5) develop a marketing mix, so that an appropriate segment can later be identified.

establish the overall strategy or objectives.

Today, almost every sales representative can immediately check the company's inventory and production schedule electronically. This allows sales reps to sell what is available and make promises to customers that they can keep. This technology has improved service delivery through 1) access to a wide variety of services. 2) greater control by customers over service delivery. 3) increased zone of tolerance. 4) greater ability to obtain information. 5) saving customers time.

greater ability to obtain information

When Toyota introduced hybrid cars, there were waiting lists to buy them. Then Honda and a few other manufacturers entered the market, shifting the product life cycle for hybrid cars into the ________ stage of the product life cycle. 1) introduction 2) leveling 3) maturity 4) growth 5) decline

growth

Liam relocated to take a new job, and when he got sick he needed to find a doctor. He discovered during the visit that he didn't like the one he had chosen, and he knew he'd never go back to that doctor. From a marketing perspective, his situation highlights one of the key differences between products and services, known as 1) intangibility. 2) professional competence. 3) perishability. 4) inseparability. 5) heterogeneity.

inseperability

Barnes & Noble bookstores have computers available for associates to use to search for books requested by customers and to place special orders. These computers are an example of 1) instrumental support. 2) employee incentives. 3) emotional support. 4) line extensions. 5) the delivery gap.

instrumental support

When a product is successful in the introductory stage of the product life cycle, 1) it moves directly into the maturity stage. 2) it is most likely to begin to launch spinoffs. 3) competition becomes less important. 4) it may start to see profits toward the end of this stage. 5) marketing costs increase significantly.

it may start to see profits toward the end of this stage.

Computer game companies constantly monitor computer game-related blogs keeping track of the latest hot products, because they know that their customers crave the "latest and greatest" games. They use this information to create new products that primarily provide the benefit of 1) keeping up in a market where sales come mostly from new products. 2) satisfying the changing needs of former customers. 3) avoiding market penetration from products that have been on the market for a long time. 4) creating diversification and reducing risk. 5) taking advantage of a long product cycle.

keeping up in a market where sales come mostly from new products.

(8) When Roger evaluated the commercial infrastructure in Korcula, a small Croatian island, he considered its 1) population 2) legal, banking, and regulatory systems 3) retailing capabilities 4) per capita income estimates 5) climate and culture

legal, banking, and regulatory systems

What is a particularly important feature of sustainable packaging? 1) better protection against damage to the product 2) lowers the product cost 3) increases the ability to see the product in multiple retail outlets 4) only using recyclable materials 5) less of a negative impact on the environment

less of a negative impact on the environment

Service employees at the airlines' flight cancelation desks frequently encounter travelers who get emotional about canceled or delayed flights. The first thing these employees should do is to 1) listen to the customer. 2) contact a supervisor. 3) estimate the damage. 4) provide a fair solution. 5) resolve the problem quickly.

listen to the customer

Del Monte, Nike, Pepsi, KitchenAid, and Sony are considered famous ________ brands because they are owned and managed by the manufacturer. 1) national 2) retailer 3) international 4) premium 5) family

national

Which of the following are reasons for the high failure rate of new products? 1) properly positioning the product 2) doing too much product testing 3) targeting a narrow segment of innovators 4) overextending a firm's abilities 5) failing to introduce lower-priced alternatives

overextending a firm's abilities

Because services like cruises and car rentals are perishable, many marketers use 1) pricing strategies to match supply with demand. 2) service quality to extend the life of the product. 3) incentives to encourage staff to deliver according to standards. 4) training to standardize delivery. 5) machines to replace people for standard transactions.

pricing strategies to match supply with demand

Suppose that CVS (a major drug store chain) wants to introduce its own brand of cough medicine that is similar in contents and packaging to a national brand, but at a lower cost. What kind of brand would CVS be introducing? 1) national brand 2) counterfeit brand 3) premium brand 4) private-label brand 5) manufacturer's brand

private-label brand

The ________ step in the product development process is critical, requiring tremendous resources and extensive coordination of all aspects of the marketing mix. 1) pretesting 2) product launch 3) posttesting 4) product development 5) evaluation of results

product launch

A ________ is a group of associated items that consumers tend to use together or think of as part of a group of similar products. 1) product line 2) product mix 3) product mix breadth 4) line extension 5) brand extension

product line

Firms spend millions of dollars annually to build brand equity, recognizing that brand equity contributes to 1) product mix breadth. 2) corporate stakeholder relations. 3) profitability. 4) brand liability. 5) perceived brand personality.

profitability

When choosing where to eat lunch, Bart's major service criterion is speed: being seated promptly and served his meal quickly. For Bart, ________ is the most important of the five service quality dimensions. 1) assurance 2) reliability 3) tangibles 4) responsiveness 5) empathy

responsiveness

Luis likes gourmet popcorn and will spend time trying to find his favorite brand. His girlfriend, Nanette, loves popcorn but doesn't care about brands. For Luis, popcorn is a ________ good while for Nanette it is a ________ good. 1) shopping; specialty 2) convenience; shopping 3) convenience; specialty 4) specialty; convenience 5) unique; universal

specialty; convenience

Serena is trying to sell a new line of ultrasound imaging equipment. Unlike existing technology, these machines are compact, creating the potential for general practice physicians to have and use them in their offices. Serena is trying to identify innovators in her market, knowing these customers will most likely 1) spread positive word-of-mouth to other physicians. 2) buy one for each office in their practices. 3) reposition his products. 4) create demand among the late majority. 5) not need any service or support when using the product.

spread positive word-of-mouth to other physicians

Many restaurants roll out new ideas first in Orlando, Florida, a location that attracts a vast range of diverse tourists and thus might offer insights into what various consumer groups will like. This is an example of 1) target marketing. 2) test marketing. 3) product marketing. 4) product launching. 5) premarket testing.

test marketing

On the basis of the research it has gathered on consumer perceptions, the tests it has conducted, and competitive considerations, the XYZ firm confirms its target market (or markets) and decides how its product will be positioned. Then the firm finalizes the remaining marketing mix variables for the new product, including the marketing budget for the first year. This process illustrates 1) the product launch. 2) the company's evaluation of results. 3) premarket demonstrations. 4) alpha testing. 5) beta testing.

the product launch

(9) When Curt's Catering first opened, the owner decided to target only events at resorts in its geographic region. Curt's Catering was using a(n) ________ targeting strategy. 1) Concentrated 2) Micromarketing 3) Benefit-driven 4) Differentiated 5) Undifferentiated

Concentrated

(8) Globalization refers to the processes by which goods, services, capital, people, information, and ideas 1) Are onshored and offshored 2) Flow across national borders 3) Are integrated through IMF facilitation 4) Are similar in various markets. 5) Affect corporate culture

Flow across national borders.

(8) T/F: In most European countries, retailers can't sell below cost, and in others they can't advertise "before" prices if the product hasn't been sold at that price for two weeks.

True

One important purpose of a brand is to 1) sell advertising space. 2) minimize product line depth needed to be effective. 3) increase consumer recognition and awareness of product offerings. 4) reduce product packaging. 5) meet government regulations.

increase consumer recognition and awareness of product offerings.

The Apple iPod changed the way people listen to music, but it also created an entirely new industry devoted to accessories such as cases, ear buds, docking stations, and speakers. The Apple iPod is considered a 1) pioneer product. 2) introductory product. 3) mature product. 4) diffused product. 5) early adopted product.

pioneer product

(9) What is the best situation in the Circles for a Successful Value Proposition framework? 1) The firm's benefits overlap with both customer needs/wants and competitors' benefits. 2) The firm's offering overlaps with customer needs/wants but not with competitors' offerings. 3) The firm's offering overlaps with competitors' benefits but not with customer needs/wants. 4) Customer needs/wants overlap with both the firm's benefits and competitors' benefits. 5) None of the three circles overlaps.

The firm's offering overlaps with customer needs/wants but not with competitors' offerings.

When corporate headquarters announced new service quality standards for pizza franchise owners, Donald knew he would have trouble gaining employees' support because 1) they were not involved in setting the goals. 2) perishable services were being replaced with tangible services. 3) they were not allowed to diverge from existing standards. 4) customers were required to create service quality standards. 5) the process involved both part-time and full-time employees.

They were not involved in setting the goals

(11) T/F: Sales of private-label brands continue to increase, particularly in big-box stores such as Costco and Trader Joe's.

True

(11) T/F: When Nanci selects a case of Dr. Pepper at the grocery store for her party, she is attracted by the holiday-themed box featuring green and white bells. What Nanci is seeing is referred to as the secondary package.

True

(12) T/F: The failure rate for new products is high

True

Before Segway manufactured its two-wheeled people movers, it built a prototype and had staff engineers test it for performance and stability. At this stage, Segway was involved in 1) alpha testing. 2) product launch. 3) test marketing. 4) beta testing. 5) concept testing.

Alpha Testing

(8) To reach more customers in India, which represents a vastly promising market but where the GDP is less than $2,000 per capita, Netflix offers subscription plans priced lower than those offered in the United States. This market is known as 1) Globalization 2) Glocalization 3) Purchasing Power Parity 4) Top of the pyramid 5) Bottom of the pyramid

Bottom of the Pyramid

When Procter & Gamble added teeth-whitening products under the Crest brand, the firm was engaged in 1) corporate branding. 2) brand extension. 3) brand licensing. 4) brand association. 5) perceived value branding.

Brand Extension

When Paulette shops for lipstick, she always buys Cotton Candy by Revlon. This is an example of 1) Brand loyalty 2) brand awareness 3) brand association 4) brand equity 5) perceived value

Brand Loyalty

(8) Which BRIC country's economic growth in the 21st century can largely be attributed to the expansion of its literate population and the impositions of social programs that have allowed more than half of its 201 million citizens to enter the middle class? 1) Brazil 2) Russia 3) India 4) China 5) Chile

Brazil

The basic reason manufacturers spend time and money building their own brands is to 1) Create brand awareness 2) build brand equity 3) offset the power of private-label manufacturers 4) Create positioning possibilities 5) Maximize Product line depth

Build Brand Equity

(8) Which of the following is a potential negative factor for foreign investment in China? 1) China's population is aging and is likely to continue to do so for many years 2) China drastically restricts the goods it allows U.S. companies to export to China 3) China's standard of living has dropped over the past 30 years. 4) China has imported fewer goods from the United States each year for the past decade 5) Chinese consumers are not interested in purchasing products from the United States

China's population is aging and is likely to continue to do so for many years

(8) China has three main languages, and many more dialects. This presents a particular challenge to developing a global ________ strategy. 1) Communication 2) Product 3) Cultural 4) Distribution 5) Pricing

Communication

The ________ gap can be reduced by managing consumers' expectations and promising only what can be delivered or possibly even a little less. 1) knowledge 2) communication 3) delivery 4) standards 5) empowerment

Communication

(8) Which of the following statements regarding global segmentation, targeting, and positioning is true? 1) Companies must continually adjust products and marketing strategies to meet the changing needs of global markets. 2) Global segmentation, targeting, and positioning activities are far less complicated than the same activities in the domestic market 3) When developing a global STP strategy, it is the best to define segments by geography alone 4) Segmentation, targeting, and positioning activities for global markets do not differ substantially from that of domestic markets. 5) The "golden rule" for global STP activities for firms is to never alter a firm's marketing mix to serve the needs of global markets.

Companies must continually adjust products and marketing strategies to meet the changing needs of global markets.

(9) T/F: Perceptual maps include positions of current brands as well as ideal points where a consumer segment would want a product to be.

True

Which of the following is included in the four product life cycle stage? 1) brainstorming 2) stagnation 3) prototyping 4) innovation 5) decline

Decline

A(n) ________ gap exists when a firm knows what it needs to do to meet customers' service expectations, but sometimes fails to do it. 1) knowledge 2) communication 3) standards 4) empowerment 5) delivery

Delivery

(8) When Nigeria's economy suffered because of a drastic fall in oil prices, the government encouraged people to buy more local products by 1) Instituting High Tarriffs 2) Developing a Social Media Campaign 3) Importing from Neighboring Countries 4) Advertising "green" options 5) Offering Family Stipends

Developing a social media campaign

(9) In a classic example of segmentation strategy, years ago Swift Meat Company transformed turkey meat into "Butterball" turkeys. In doing so, the company 1) Differentiated its product 2) Streamlined its delivery process 3) Created a new class of micromarketing 4) Defined consumers' basic needs 5) Redefined mass customization

Differentiated its product

(8) ________ offers the firm complete control over its operations in the foreign country. 1) A Joint Venture 2) Franchising 3) A strategic Alliance 4) Exporting 5) Direct Investment

Direct Investment

________ means allowing employees to make decisions about how service is provided to customers. 1) Endorsement 2) Quality control 3) Standardization 4) Empowerment 5) Authorization

Empowerment

(9) Darlene has identified four potential market segments for her Don't Do It Yourself handyman service. The next step is to 1) categorize each market segment by consumer demographics. 2) establish her overall objectives. 3) decide on a targeting strategy. 4) develop a positioning strategy 5) evaluate the attractiveness of each segment

Evaluate the attractiveness of each segment

(8) According to purchasing power parity theory, if ________ is(are) in equilibrium, products will cost the same in each country. 1) Imports and Exports 2) Consumer Spending 3) interest rates 4) Domestic Products 5) Exchange Rates

Exchange Rates

(11) T/F: A customized mailbox for your house is an example of a convenience product.

False

(11) T/F: For the average college student, a retirement account would be a shopping product.

False

(12) T/F: Although innovation strategies may not work in the long run, overriding short-term reasons compel firms to introduce new products and services.

False

(12) T/F: On the diffusion of innovation curve, the first group of buyers who want to be the first on the block to have the new product are known as early adopters.

False

(12) T/F: The maturity phase of the product life cycle is characterized by greatly reduced competition.

False

(13) T/F: All products and services are intangible.

False

Which of the following refers to variability in a service's quality? 1) heterogeneity 2) perishability 3) service gap 4) delivery gap 5) communications gap

Heterogeneity

(8) A company is assessing opportunities in the BRIC countries and determines that ________ is one of the youngest populations in the world and is increasingly adopting global attitudes. 1) Russia 2)Brazil 3) India 4) Italy 5) China

India

The ________ stage of the product life cycle is characterized by negative or low profits. 1) introduction 2) leveling 3) maturity 4) growth 5) decline

Introduction

Because customers have different needs and expectations, the key to distributive fairness in service recovery is to 1) listen to the customer. 2) contact a supervisor quickly. 3) estimate the damage. 4) provide a fair solution. 5) resolve the problem quickly.

Listen to the customer

(9) When Mario complained to his bank about the unprofessional behavior of one teller, the branch manager added a code into his accounts alerting all tellers that Mario was a valued customer and to provide whatever service he requests. The branch management included Mario in its __________ segmentation. 1) Benefit 2) Geodemographic 3) Psychographic 4) Loyalty 5) Geographic

Loyalty

(9) When airlines created frequent-flyer programs, they were among the first retailers to embrace 1) Geographic Segmentation 2) Education Segmentation 3) Lifestyle Segmentation 4) Convenience Segmentation 5) Loyalty Segmentation

Loyalty Segmentation

By changing a standard from "be nice to customers" to "greet every customer, and if possible by name," a services marketing manager has created a(n) ________ goal. 1) insurmountable 2) invisible 3) empowerment 4) measurable 5) inseparable

Measurable

(9) Which of the following is a key component of a value proposition? 1) Purchase behavior 2) Intersection of psychology and demographics 3) Offering name or brand 4) Loyalty references 5) Geographic Location

Offering Name or Brand

(8) Dartel, a former retailer, has been living in the United States for five years and wants to start a business. He does not have an existing firm or a product, and he doesn't have a lot of capital, but since he loves McDonald's food, he decides to 1) Open a McDonalds Franchise 2) Directly invest in McDonalds 3) Export McDonald's products to other countries 4) Form a strategic alliance with McDonald's 5) Form a joint venture with McDonald's

Open a McDonald's Franchise

(9) Whenever Liam calls on potential pest control customers, he emphasizes the fact that, unlike the national franchise competitors, he is a local businessperson and has been in business over 20 years. Liam is ________ his business relative to his competition. 1) Segmenting 2) Packaging 3) Positioning 4) Pricing 5) Targeting

Positioning

(9) Darlene has identified four potential market segments for her Don't Do It Yourself handyman service. She will now evaluate whether or not each segment is attractive relative to all of the following except 1) Substantial 2) Responsive 3) Profitable 4) Reachable 5) Realistic

Realistic

Private-label brands are developed and marketed by a(n) 1) individual. 2) manufacturer. 3) advertising agency. 4) marketing agency. 5) retailer.

Retailer

(8) The shift of population from rural to urban areas in countries such as India helps global marketers by 1) Decreasing pollution 2) Simplifying the supply chain needed to make goods and services available 3) Increasing the human developments 4) Decreasing competition for intellectual capital 5) Increasing nonmaterial GDP output

Simplifying the supply chain needed to make goods and services available

(8) Manufacturers would prefer to produce in a country with a trade ________, because it signals a greater opportunity to export products to more markets. 1) Surplus 2) Deficit 3) Discrepancy 4) Bonus 5) Balance

Surplus

The Broadmoor Hotel in Colorado Springs, Colorado, maintains its five-star rating by focusing on five service characteristics: reliability, responsiveness, assurance, empathy, and tangibles. The hotel has been updating rooms built in the early part of the 20th century to meet the needs of 21st-century visitors. To accomplish this, it spent millions in improvements, renovating rooms, and adding a new outdoor pool complex. These renovations focus on the ________ service characteristic. 1) empathy 2) reliability 3) assurance 4) tangibles 5) responsiveness

Tangibles

(9) Vanessa wants to position her financial services company. She can position her services according to 1) The Value Proposition 2) Neighboring retail outlets 3) Number of employees 4) An undifferentiated targeting strategy 5) Profitability

The Value Proposition

(11) T/F: Harry is a loyal Coca-Cola customer. Loyal customers like Harry require lower marketing expenditures, benefiting businesses like Coca-Cola.

True

(12) T/F: When consumers see their friends using an innovation, it often persuades them to try it too.

True

(9) T/F: When deciding how to promote his new medical oncology center, Dr. Smith decided that he did not need to throw a large grand opening reception. Instead, he promoted the center to the internal medicine doctors in the area, who were the doctors most likely to refer patients to the center. Dr. Smith was engaged in a concentrated targeting strategy.

True

T/F: To maximize potential, segments and target markets can and should be defined by more than just geography.

True

(9) Maintaining a unique ________ can be sustained in the long term only in monopoly situations or monopolistic competition situations. 1) Market Position 2) Value Proposition 3) Salient Attribute 4) Marketing Communication 5) Market Segmentation

Value Proposition

The product life cycle is theoretically ________ with regard to sales and profits. 1) U shaped 2) Y shaped 3) bell-shaped 4) circular 5) flat lined

bell-shaped

Laptop computers, personal digital assistants, and cellular phones were all readily accepted and diffused in U.S. markets where business and personal lifestyles tend to be faster-paced, compared to many other areas in the world. These products offered ________ with consumers' needs and priorities. 1) relative positioning 2) compatibility 3) observability 4) complexity 5) trialability

compatibility

________ is another term for private-label brands. 1) Store brands Off brands Manufacturer's brands National brands Experiential brands

store brands