BA 370 Exam #3
When a firm has a particular profit goal as its overriding concern, it will use target return pricing to meet the profit objective.
False
A(n) _______ market legally circumvents authorized channels of distribution to sell goods at prices lower than those intended by the manufacturer.
gray
Which of the following is a true statement about distribution centers?
They enable retailers to carry less merchandise in individual stores.
The saying "leaving money on the table" is associated with
a market penetration strategy when there is an opportunity for price skimming.
Break-even analysis is useful because it allows managers to
estimate the quantity they will need to sell at a given price to break even.
The three elements of any IMC strategy are the consumer, the channels, and
evaluation of the results
The IMC communication process includes all of the following except
evaluation.
A demand curve is built on the assumption that
everything but price and demand remains the same.
A ____________ advertising schedule uses heavy advertising during some periods followed by periods of no advertising.
flighting
Tyler runs a parasailing business on Hilton Head Island, South Carolina. Tyler closes his business in winter when the water gets too cold. Tyler should use a __________ advertising schedule.
flighting
When Cynthia's Boutique receives dresses, they already have price tags and are on hangers. Cynthia's Boutique receives __________ merchandise.
floor ready
Colin has just received a delivery from the company's distribution center. He opens the containers and finds the popcorn and snacks are all bar-coded and priced and the package includes an end-of-the-aisle display rack. Colin has received a(n) __________ shipment.
floor-ready
Some retailers require their suppliers to ship merchandise ___________, thus eliminating the time and expense associated with ticketing and marking.
floor-ready
Merchandise that arrives in the delivery truck ready to be sold is considered
floor-ready.
Jordan directs her salespeople to increase the company's share of wallet. Jordan is directing her salespeople to
focus on increasing sales to their best customers.
The advertising message "People are not looking for quarter-inch drill bits; they are looking for quarter-inch holes" suggests that advertising messages need to
focus on solving problems
The most common type of contractual vertical marketing system is a
franchise.
An ad for Bud Light ran six times during a recently televised football game. When measuring IMC results for this ad, six would be the __________ for this telecast.
frequency
Yolanda asked her firm's advertising agency to estimate how often consumers saw her firm's IMC message and what percentage of the target audience was exposed to the message. Yolanda is asking for __________ data.
frequency and reach
A _______ is used in the shipment of products directly to customers.
fulfillment center
A customer who is shopping for fashionable, but relatively low-cost merchandise in a pleasant environment is shopping at a
full-line discount store.
Retailers that offer a broad variety of merchandise, limited services, and low prices are known as
full-line discount stores.
Even the best marketing communication can be wasted if the sender does not first
gain the attention of the consumer.
Full-line discount, category specialist, and specialty stores are all types of __________ retailers.
general merchandise
Yesenia is working on an advertisement to promote consumer awareness of the danger of solar radiation causing skin cancer. Yesenia's first concern will be to
get consumers' attention.
To get us to remember their ad and the product or brand in the ad, advertisers must first
get our attention
The goal of any marketing communication is to
get the right message to the right audience through the right media.
In very simple words, advertising is really about
getting consumers' attention.
What type of pricing tactic is being used when several airlines agree to charge the same fare for a single route?
horizontal price fixing
Which of the following is the most logical example of complementary products?
hot dogs and hot dog buns
Greg is planning an advertising campaign to promote his kayak tour company. The success of his ad campaign depends on
how well he can identify his target audience
Marketers advertising an artificially high "regular price" are unethically attempting to influence consumers' __________ perceptions.
reference price
The percentage of a customer's purchases made from a particular retailer is referred to as
share of wallet
Generally, which of the following media outlets relies on a mix of visual and auditory techniques and is typically very expensive?
television
Unlike product, promotion, or place, price is the only part of the marketing mix
that generates revenue.
The demand curve for prestige products generally slopes downward due to higher prices.
False
What makes a high/low pricing strategy appealing to sellers?
It attracts two distinct market segments.
Which of the following is the best example of a persuasive advertising message?
"Buy now, pay later"
Which of the following is the best example of a reminder advertising message?
"Doing business in Peoria since 1848."
Once the marketing communication has captured the interest of its target market, the goal of subsequent IMC messages should be to move the consumer from
"I like it" to "I want it"
Which of the following is the best example of puffery?
"You have tried the rest, now try the best."
Raymond estimates that the fixed costs associated with opening a new bank branch are $500,000. He expects the branch to attract 1,000 new customer accounts in the first year, each of which will cost $50 per year to service. He also expects to generate $100,000 per year in revenue. For Raymond, the total cost of opening the new branch and remaining open for one year will be
$550,000.
Jacob rents rooms in his hotel for an average of $100 per night. The variable cost per rented room is $20, to cover maid service and utilities. His fixed costs are $100,000 and his profit last year was $20,000. For Jacob, the contribution per unit is
$80.
When Apple's famous 1984 "Big Brother" ad aired during the Super Bowl, it reached an estimated 500 million viewers. It aired only once on commercial television, but was seen in later years in at least 10 television programs recalling great commercials. For its target audience, the frequency of this ad is measured as
1
Jason rents rooms in his hotel for an average of $100 per night. The variable cost per rented room is $20. His fixed costs are $100,000 and his target profit is $20,000. For Jason, to earn his target profit, he will need to rent out ________ rooms.
1500
When Yolanda asked her firm's advertising agency to estimate how often consumers saw her firm's IMC message and what percentage of the target audience was exposed to the message, she was told the reach was 40, the frequency was 4, and the competitive parity was 10. The gross rating points for her firm's campaign were
160
If the fixed costs of manufacturing a new cell phone are $10,000, the sales price is $60, and variable cost per unit is $20, the break-even point is
250 units.
From a retailer's perspective, a(n) _______ is helpful in order to know exactly what will arrive in a particular shipment from a supplier.
ASN
Personal selling is an especially important part of IMC in
B-2-B markets
Generally, less money is spent on advertising in B2B markets because
B2B marketing involves personal selling
In developing marketing strategies, why is price often the most challenging of the four Ps to manage?
Because it's the least understood element of the marketing mix
Which of the following is not true about public relations?
Because of its high cost, the use of PR has waned in recent years.
__________ refers to a potential customer's ability to recall that the brand name is a particular type of retailer, product, or service.
Brand awareness
Benton manages a building supply company. He wants to invite 20 of his most valuable building-contractor customers to a golf outing and party. Benton will likely use the firm's ___________ to identify these customers.
CRM database
_______ products are products whose demands are positively related and as such, they rise or fall together.
Complementary
__________ are combating competitive pressures by offering fresh food and healthy fast food, tailoring assortments to local markets, opening locations closer to where consumers work and shop, and adding new services.
Convenience stores
__________ is when vendors ship merchandise prepackaged in the quantity required for each store to the distribution center.
Cross-docking
__________ is when two or more firms join forces to reach a target audience in a short-term effort.
Cross-promotion
Which of the following is not an advantage of using a distribution center?
Customers know they are dealing with a more sophisticated and financially well-off operation if the firm uses a distribution center.
In addition to merchandise and payments, information flows throughout a supply chain. Which of the following is not a good characterization of the flow of information in a supply chain?
Customers will send and receive information from stores and manufacturers.
__________ refers to the process by which the receiver interprets the sender's message.
Decoding
What situation is occurring if a 1 percent decrease in price results in more than a 1 percent increase in quantity demand?
Demand is price elastic
__________ are combating competitive pressures by increasing the amount of exclusive and private-label merchandise they sell, and expanding their online presence.
Department stores
How can a company find its way out of a market characterized by pure competition?
Differentiate the product in some way, even by packaging, so customers will see it as distinct
When Walmart communicates to consumers that, for any given group of often-purchased items, its prices will tend to be lower than that of any other competitor, Walmart is exhibiting what type of pricing strategy?
EDLP
It is important to Joanne to get value for her money, but she does not want to spend time comparison shopping. Joanne will likely respond to _______ pricing, but not to _______ pricing.
EDLP; high/low
U.S.-based global marketers have often found that
EU advertising laws are more restrictive than those in the United States.
___________ means converting the sender's ideas into a message, which could be verbal, visual, or both.
Encoding
Price is the cash expenditure plus taxes that consumers have to pay for a good or service.
False
__________ are likely to target low-income consumers who demand national brands, but cannot afford to buy large-sized packages.
Extreme value retailers
__________ offer a limited assortment of general merchandise at very low prices and are often found in lower-rent locations.
Extreme value retailers
__________ reduce costs and maintain low prices by buying opportunistically from manufacturers with excess inventory, offering limited assortments of household goods and groceries, as well as health and beauty aids.
Extreme value retailers
Which of the following is not one of the federal agencies that regulate advertising activities?
FRS
The __________ is the primary enforcement agency for mass media advertising.
FTC
A demand curve shows the relationship between income and demand.
False
What is one of the drawbacks of using a price skimming strategy?
Firms must consider the high costs associated with producing a small volume of product.
George wants to increase the number of visits to his insurance firm's website, which specializes in rental insurance for college students. George decides to target Internet browsers who use the terms apartment, insurance, and student. Which of the following will be most helpful to George?
Google AdWords
_______ channel conflict occurs when there is disagreement or discord among members at the same level in a marketing channel, such as two competing retailers or two competing manufacturers.
Horizontal
_________ price fixing occurs when competitors collude to control prices, and __________ price fixing occurs within a marketing channel to control prices passed on to consumers.
Horizontal;vertical
Natalie represents a manufacturer who makes unique, high-end hats. When making a recommendation about potential retail partners, what should be Natalie's first consideration?
How likely is it for certain retailers to carry this product?
__________ appeals help consumers make purchase decisions by offering facts in advertising messages and strong arguments built around relevant issues, explaining key benefits of the firm's products and services.
Informational
Which statement best describes personal selling?
It is the two-way flow of communication between a buyer and a seller.
_______ systems are designed to deliver smaller shipments of merchandise on a more frequent basis to retailers.
Just-in-time (JIT)
________ power is based on getting a channel member to behave in a certain way because of a contractual agreement.
Legitamate
__________ pricing tactics lower the price of a product below the store's cost.
Loss leader
When a company offers consumers the ability to make purchases via a smartphone, this is known as
M-commerce
Chandra owns a pet sitting service. He recently paid a web developer to build a special version of his company website for use on smartphones. Customers will now be able to easily place orders for pet sitting on their cell phones. This is an example of
M-commerce.
_______ channels are used to reach a broad audience; _______ channels are used to reach a narrower segment of consumers
Mass media; niche media
_______ refers to the process of evaluating and selecting the _______.
Media planning; media mix
__________ is any interference in the IMC process.
Noise
________ offer an inconsistent assortment of brand-name merchandise at low prices.
Off-price retailers
__________ can purchase merchandise at substantial discounts from the original wholesale prices because they do not ask the suppliers for advertising allowances or markdown adjustments
Off-price retailers
_________ is the term used to describe the situation when retailers use some combination of stores, catalogs, and the Internet to sell merchandise.
Omnichannel retailing
In a retail supply chain, the ________ records the purchase information and electronically sends it to the corporate office.
POS terminal
A __________ is an advertisement that focuses on public welfare issues
PSA
According to your text, research has consistently shown that consumers usually rank which of the four Ps as one of the most important factors in their purchase decisions?
Price
________ must always be aligned with other elements of a retailer's strategy in order to accurately define the value of the product and a retailer's image.
Price
_______ measures consumers' sensitivity to price changes
Price elasticity of demand
__________ is the practice of colluding with other firms to control prices.
Price fixing
__________ is a particularly good advertising medium for groceries and fast food.
Radio
__________ are special incentives or excitement-building programs that encourage consumers to purchase a particular product, often used in conjunction with advertising or personal selling programs.
Sales promotions
Of the following retailers, the best example of a category killer is
Staples
_________ are subtle forms of promotion that encourage shopping in retailers' stores.
Store credit cards and gift cards
Which of the following is not a major consideration in determining an advertising budget?
The bugeting method used
Which of the following represents the best reason a manufacturer of high-end products might consider selling products in a warehouse club?
The manufacturer overestimated demand or has a great deal of returned merchandise from other retailers.
The manufacturer of Beats by Dr. Dre headphones decides to advertise in the "lifestyles" sections of big-city newspapers. However, this generates a limited response in sales. Which of the following represents a likely breakdown in the communication process here?
The message was not received by its intended audience
What is the difference between a coupon and a rebate?
The retailer handles coupons while manufacturers handle most rebates.
Because consumers are generally more sensitive to price increases than to price decreases, it is easier to lose current customers with a price increase than it is to gain new customers with a price decrease.
True
Dynamic pricing is also referred to as individualized pricing.
True
Price elasticity of demand measures how changes in a price affect the quantity of the product demanded.
True
Price is the only part of the marketing mix that does not generate costs.
True
Pricing strategies should be aligned with a firm's overall goals and objectives.
True
Rarely is the lowest-price product offering the dominant brand in a given market.
True
The key to successful pricing is to match the product with the consumer's perception of value.
True
A __________ is a 13-digit code retailers can use to track inventory
UPC
_______ channel conflict occurs when members of the same marketing channel, for example, manufacturers, wholesalers, and retailers are in disagreement or discord.
Vertical
_______ occurs when members of the marketing channel collude to control the prices passed on to consumers.
Vertical price fixing
Supercenters are large stores that combine a supermarket with a full-line discount store. _______ dominates this category with the vast majority of supercenters in the United States.
Walmart
Compared to conventional supermarkets, warehouse clubs have
a lower level of service
Assume the demand for electricity, a necessity with few substitutes, is -0.2. If the electric company raised its rates by 10 percent, we would expect
a 2% decrease in quantity demanded
The expression "3/10, n/30" means
a 3 percent discount if paid in full within 10 days, or the net amount is due in 30 days.
First Lady Michelle Obama has recorded an ad encouraging parents to teach their children good nutrition habits to stem the increase in child obesity. This message is an example of
a PSA
Because many consumers choose stores based on proximity to their workplaces or homes, great locations are
a competitive advantage that few rivals can duplicate.
As a type of retailer, category specialists are fierce competitors using
a complete assortment in a specific category at low prices.
Often, advertisers will employ a variety of media to deliver their message. When using different media, advertisers need to deliver
a consistent and compelling message.
Though advertising experts wish it were true, there is not always a direct link between a particular marketing communication and
a consumer's purchase.
Customers must see value in a product or service before they are willing to exchange time or money to obtain it, but not all customers see the same value in a product. To analyze how many units will be sold at any given price point, marketers draw on
a demand curve.
National manufacturers and retailers often pay a service provider to monitor television ads around the country, to ensure that their ads are shown in their entirety during the time frames that were purchased. This service provider is monitoring for IMC noise problems associated with
a flaw in the medium.
A pricing strategy is
a long-term approach to setting prices in a companywide integrated effort.
Yurgen is opening a financial consulting service for high-income retirees in his area. This target market is used to paying for quality and associates high quality with high prices. In this instance, Yurgen should probably not use a market penetration pricing strategy because
a low price might signal low quality.
The difference between advertising and publicity is that advertising is
a paid form of marketing communication.
Advertising agencies often provide the IMC function of comparing their customer's target audience with the viewer, listener, or reader profile of the communication channel being considered. The agency is most likely trying to avoid noise problems associated with
a poor choice of medium.
Generally, when advertising to consumers, the objective of an advertising campaign is
a pull strategy—to get the product into stores by having consumers demand it.
A pricing tactic is
a short-term approach that is often in response to a competitive threat.
If you're a manufacturer, and you want to showcase your product in a store that has a narrow but deep selection of merchandise and where sales associates can assist customers with their selections, you'd most likely choose
a specialty store.
For which of the following is demand likely to be most sensitive to price increases?
a specific brand of soft drink
Jenna has a large family and likes to stock up on large packs of basics like toilet paper, paper towels, and large bottles of condiments like ketchup. Jenna would most likely prefer to shop for these items at
a warehouse club
One advantage of a retail store that is not shared with an Internet channel is
accepting cash payments.
In the AIDA model, the do stage is the __________ stage.
action
Retailing is defined as the set of business activities that
adds value to products and services sold to final consumers.
Today, when a customer orders merchandise from an online vendor, the vendor usually sends an immediate order confirmation message by e-mail. Usually within a day or two, a second message arrives stating that the order is in the mail. This second message is a type of
advanced shipping notice
Roland has just received notification from a vendor that his clothing merchandise order has been processed and dispatched. Roland has just received a(n)
advanced shipping notice.
The proliferation of new media alternatives has led many firms to shift their promotional budgets from
advertising to direct marketing and website development.
Sally could recall the brand of toothpaste she used only when a marketing researcher mentioned the brand. This is known as
aided recall
Cheryl asked Nadia to help her buy some aftershave for her boyfriend. Nadia was going through a list of different brand names, when Cheryl stopped her and said, "I recognize that one." Marketers call this
aided recall.
Especially in the fashion industry where styles and trends change rapidly, a quick response system can
align deliveries more closely with actual sales.
Frank's Heating and Air Conditioning Company specializes in electric heat pumps. Frank keeps track of the price of natural gas, knowing that
an increase in the price of natural gas will increase demand for his electrical heating systems.
Margaret has been invited to a fancy dinner party and wants to bring a good bottle of wine as a gift for the host. Since she does not know much about wine, she will likely use the price of the wines as
an indicator of quality.
Bertone's Office Supplies has decided to branch out from its existing stores. It plans to start sending out a catalog, and also to sell its products online. Bertone's is adopting
an omnichannel strategy.
Which of the following is the least likely common emotional appeal for advertisers?
anger
A noncumulative B2B quantity discount is
based only on the amount purchased in a single order
Value-based pricing methods include approaches to setting prices that focus on the overall value of the product offering
as perceived by the consumer.
An everyday low pricing strategy stresses the continuity of retail prices
at a level between the regular price and the deep-discount sale prices of competitors.
Where does retailing fall in the supply chain?
at the end
In the AIDA model, the think stage is the __________ stage.
awareness
Bill desperately needed tires for his car, and he found an ad with an incredibly low price. When he got there, he found out that those had supposedly been sold out, and he was pressured into buying tires that were more expensive than he wanted. Bill found out later that Marcelo had the same experience at the store a few weeks earlier. It's quite possible that both Bill and Marcelo had become the victim of a deceptive pricing tactic known as
bait and switch
In a __________ pricing tactic, sellers advertise very low prices and then aggressively pressure customers to purchase higher-priced versions of the product advertised with the low price.
bait and switch
The goals of IMC need to
be explicit and measurable
Brad is working on the creative design for his company's new ad campaign. This is his first major assignment. His boss reminds him that when writing a headline, it should
be short and use simple words.
As the number of communication media has increased, the task of understanding how best to reach target customers has
become more complex.
The major text portion of a print advertisement that should arouse a desire for the product and move the consumer to action is contained in the
body copy
For retailers, promotion refers to
both their in-store environment and their media communications.
Lars wants to purchase a gift for a colleague whose home he will be visiting. He decides to bring luxury chocolates, as he knows most people enjoy them. Although he is not sure about specific products, Lars heads directly for a store selling Godiva Chocolates, because he knows this is a high-end brand. Lars can be said to have
brand awareness
Sophia could not afford expensive furnishings, but wanted a stylish home. After researching many options, she went to a local Target to purchase the trendy lamps, pillows, and art featured on its ads and website. As a consumer, which retailing challenge was Sophia likely responding to?
brand image consistency
The point at which the number of units sold generates enough revenue to equal the total costs of running an operation is known as the
break-even point.
Because PSAs are a special class of advertising, FCC rules require
broadcasters to devote a specific amount of free airtime to them.
Which of the following is not one of the typical outlets used by retailers?
business-to-business requests for proposals (RFPs)
Bertone's Office Supplies has large stores resembling warehouse environments, with racks stocked from floor to ceiling with different types of office supplies. Its assortment of office supplies is the largest in town, and their prices are low. Bertone's is a(n)
category specialist
Kevin is recognized by his friends as an activist on many fronts. He prefers to buy products from firms that will donate part of the total purchase price to organizations he supports. Marketers recognize that this approach can be an important competitive tool; it is called
cause-related marketing
One of the advantages of niche media is it often allows marketers to
change and personalize messages for different audiences
Variable costs change with
changes in the quantity being produced.
Yesterday, Lorinda overheard a surprisingly unpleasant encounter between the manager of the hardware store where she works and a sales rep who sells a well-known line of tools. The rep insisted that his tools should be more prominently displayed and that a better assortment would mean more sales. The manager had other plans and told him so, and the conversation turned into a loud argument. What Lorinda observed was an example of
channel conflict.
Franchising involves a(n) __________ vertical marketing system.
contractual
Brian, an industrial equipment sales rep, purchases a quick snack to eat on the way to work. He buys lunch while on the road visiting customers, and grabs bread and milk on the way home when he stops to buy gas. Brian probably does the majority of this shopping at a
convenience store
Ted is glad his company finally converted to an RFID system. Now, he no longer needs to go through all the new goods to make sure what they ordered was what they received. Ted is responsible for __________ in his company.
checking
Yana has identified the target audience for her line of Russian jewelry. For optimum success, she is creating an advertising plan that will
clarify the specific goals that the advertising is designed to accomplish
When her company's dry goods deliveries were late for the third time, Melissa withheld payment from her supplier until it was back on schedule. This is an example of ________ power.
coercive
Which of the following is not one of the five Cs of pricing?
collaboration
A firm's marketing communication strategy is formulated specifically to
communicate the value of its products
The basic goal of integrated marketing communications is to
communicate the value proposition to the target market.
In the IMC communication process, the __________ is the medium that carries the message.
communication channel
In the IMC process, noise can occur as a result of lack of message clarity, a poor choice of medium, or
competing messages.
In many high-end resort markets, Westin hotels compete directly with Crown Plaza hotels. When it comes to pricing, Westin tends to charge its guests similar rates to what the Crown Plaza hotels charge. Westin is using a _______ pricing strategy.
competitive parity
When firms set prices similar to those of competitors, they are following a strategy of
competitive parity
Firms using a(n) _______ pricing method set their prices relative to what other firms are charging.
competitor-based
When Greenbelt Construction Company began building houses in a large subdivision with many other builders, the company priced its homes slightly higher than its competitors and promoted the added quality features found in Greenbelt's homes. Greenbelt was using a _______ pricing strategy.
competitor-based
When Ursula decides how to price new products in her gift store, she measures the value of her product offerings against those of the other stores in her area. Ursula uses a _______ pricing strategy.
competitor-oriented
Diane owns a bakery where she sells cupcakes. Two blocks down there is another bakery, CC's Bakery, that sells cupcakes for $1 less than Diane. Diane decides to lower her price and match CC's Bakery prices. What type of pricing strategy is Diane implementing?
competitor-oriented pricing
It is often difficult for retailers to distinguish themselves from their competitors through the merchandise they carry because
competitors can purchase and sell many of the same popular brands
Bill is a yacht broker in the southeastern United States. For years he has had difficulty selling large yachts locally because there were few places to dock these boats. Yachts and spaces to dock them are an example of
complementary products.
Wholesalers sell to all of the following except
consumers
Especially for marketers with new products or services, IMC is needed because
consumers are unlikely to buy products they are not aware of.
In general, prices should not be based on costs because
consumers make their purchase decisions based on perceived value.
For an advertiser, the target audience can be understood as
consumers whom its research designates as its target market.
For consumer products like toothpaste and groceries, things consumers purchase throughout the year, most advertisers would use a __________ advertising schedule
continuous
Considering what you know about their target markets and merchandise, which of the following retailers is least likely to have an online presence?
convenience stores
If a manufacturer had a full range of products, in a number of different container sizes, which kind of store would the company be least likely to choose as a retailing partner?
convenience stores
For brick-and-mortar retailers, when making decisions regarding place, a key ingredient to success is
convenient locations.
In a __________ marketing channel, none of the participants have any control over the others.
conventional
In integrated marketing communications, encoding involves
converting the sender's ideas into a message.
A __________ can be used to create positive word of mouth, help customers form a community, and develop long-term relationships between customers and the company.
corporate blog
Which of the following is most effective in building brand image, listing details about retail locations and educating customers about products and services?
corporate website
The three types of vertical marketing systems are administered, contractual, and
corporate.
In determining the price for his company's new personal computer photography printer, Raymond is assessing the total cost of owning his printer as compared to alternative products available in the market. Raymond is using _______ pricing.
cost of ownership
Milton owns a lawncare business. From experience, Milton has found that John Deere equipment lasts almost twice as long as competitors' machines. For John Deere, Milton's perception about its products makes _______ pricing a logical choice.
cost of ownership
The pricing method that considers what consumers may be willing to pay for a particular product based on the value received over the product's entire lifetime is the _______ pricing method.
cost of ownership
Compared with other methods used to set prices, _______ pricing is relatively simple.
cost-based
Yvonne estimates the average cost of her floral arrangements is $14 regardless of whether she is making 5 or 20 arrangements that day. She adds a standard markup to the $14 estimate to determine her price. Yvonne is using a(n) _______ pricing method.
cost-based
Many stores now e-mail codes to their customers that can be used on their websites or printed and brought into the store to receive discounts for products purchased. In this instance, the customer is using a _______ to receive the discount.
coupon
Retailers use _____ because they believe their use will induce customers to try new products, convert first-time users to regular users, increase purchases, and protect market share.
coupons
Which of the following is not a public relations tool?
coupons and rebates
The key to a successful emotional advertising appeal is to use the emotion to
create a bond between the consumer and the brand.
Informative advertising is used to
create and build brand awareness
In the movie Field of Dreams, one of the memorable phrases is, "If you build it, he will come." The AIDA model would suggest that after marketers "build" a product or service and create awareness among consumers, they need to
create interest among consumers, persuading them to investigate further.
Compared to other IMC alternatives, advertising is extremely effective for
creating awareness and generating interest in a product
Which of the following is not required to build a successful strategic relationship?
creation of a joint venture
After the advertiser has decided on the message, type of ad, and appeal, its attention now shifts to
creation of the advertisement
If a firm declared that it wanted to develop a strategic relationship, but was unwilling to commit funds or any effort to make it succeed, there would be an obvious lack of
credible commitments
In a __________ distribution center, merchandise moves from vendors' trucks to retailers' delivery trucks in a matter of hours.
cross-docking
When a firm sets its pricing strategy based on how it can add value to its products or services it has embraced a(n) _______ orientation to pricing.
customer
Annabeth is looking for a Michael Kors chronograph watch, and assumes she can view and try them on at Macy's. She makes a special trip to the store to look at the watches, and selects the style she likes best. Which aspect of choosing a retail partner allowed Annabeth to confidently shop for this item at a particular store?
customer expectations
A "no haggle" pricing policy is a type of _____ pricing strategy.
customer-oriented
Julia's is an upscale women's clothing store. Prices are based on customers' beliefs about the value of the clothing. The store focuses on a limited target market and provides excellent customer service. Julia's is using a _______ pricing strategy.
customer-oriented
Traditional demand curve economic theory is used by marketers to understand _______ in the five Cs of pricing.
customers
Many retail golf stores have driving ranges, some with backdrops showing famous golf courses. These driving ranges allow
customers to try before they buy.
"Buy one, get one free" is a __________ sales promotion.
deal
Price advertisements should never
deceive customers to the point of doing harm.
If you ever watched a television commercial and at the end of the message wondered what they were promoting, you may have had trouble __________ the IMC message.
decoding
Managers of Wendy's fast-food restaurants keep track of prices at competitors such as McDonald's, Burger King, and Arby's, knowing that a decrease in the prices at these other fast-food restaurants will
decrease demand for Wendy's products.
If the price for a product increases, the demand for the complementary product will
decrease.
If you walk into a(n) __________, you will likely find a broad variety of merchandise, deep assortment, and customer service, with everything divided into what appears to be a collection of specialty shops.
department store
Kohl's, JCPenney, and Bloomingdales are examples of
department stores.
In the "create advertisements" step when planning and executing an ad campaign, often the execution style for the ad will
dictate the type of medium used to deliver the message.
Having no intermediaries between the buyer and seller is a defining characteristic of a(n) _______ marketing channel.
direct
Trisha makes purses out of old blue jeans and sells them to customers at local craft fairs. What type of marketing channel does this represent?
direct
Brenda wants to reduce mass media IMC and to increase the use of personalized marketing communication messages. To achieve this goal, Brenda will likely increase her use of
direct marketing
Cora will be a bridesmaid next summer, and has purchased her dress online. The next time she turned on her computer, Cora was surprised to see special offers for matching accessories. This is an example of which marketing strategy?
direct marketing
In recent years, the component of IMC that has received the greatest increase in aggregate spending is
direct marketing
The increased use of customer databases has enabled marketers to identify and track consumers over time and across purchase situations, and has contributed to the rapid growth in
direct marketing
When purchasing books on Amazon.com, customers are shown other books and a message saying "Customers who purchased (your book) also purchased..." This is an example of
direct marketing
Sophie made pies and sold them from her food truck to local businesses. This is an example of a
direct marketing channel
Which of the following is the least interactive IMC strategy?
direct marketing via catalog
Which of the following is not one of the activities carried on in a distribution center?
distributing paychecks and paystubs for retail employees
A _______ is a facility for the receipt, storage, and redistribution of goods to company stores.
distribution center
The break-even point is estimated by
dividing fixed costs by contribution per unit.
A weakness associated with cost-based pricing methods is that they
don't not recognize the role consumers or competitors' prices play in the marketplace.
Betty is assessing the effectiveness of her firm's marketing communications. She knows the ultimate goal is to
drive the receiver to action
The process of charging different prices for goods or services based on the type of customer, level of demand, or time of the day, week, or season is referred to as
dynamic pricing.
Marketing channels and supply chains comprise various buying entities that form relationships with one another. The basic motivating factor in these interactions is
each party wants something from the others.
Marketers often use focus groups to learn how consumers interpret their IMC messages. Experience has shown that
each receiver decodes IMC messages in their own way.
When it comes to measuring consumers' price sensitivity, products are viewed as either
elastic or inelastic
Typically, manufacturers and retailers exchange business documents through a(n) __________ system, the computer-to-computer exchange of business documents from a retailer to a vendor and back.
electronic data interchange
After installing a(n) _______ in its JIT system, Chocolate Tree (a retail chocolate store) was able to reduce lead time for merchandise orders.
electronic data interchange system
Flora is frustrated with her company's supply chain management information system. She wants to be able to receive sales data, initiate purchase orders, send and receive invoices, and receive returned merchandise documentation. Flora needs a(n)
electronic data interchange system
Automobile manufacturers often use television advertising showing an attractive man or woman driving the manufacturer's stylish new car on a winding road along an ocean vista. These types of ads have __________ appeal.
emotional
Danielle is creating an advertising message designed to appeal to consumers' fears of having their home broken into. Danielle's message will focus on a(n) __________ appeal
emotional
An emotional appeal aims to satisfy consumers' __________, while an informational appeal speaks to consumers' __________.
emotional desires; utilitarian needs
Paul's family has owned and operated a small chain of conventional supermarkets for many years. Competition from a variety of other kinds of retailers has adversely affected the business. To address the new competitive reality, Paul wants to apply what he recently learned as a marketing major and he has recommended that his family's business should
emphasize fresh, locally sourced perishables.
Aaron has designed innovative accessories for hard-core bicycling enthusiasts. He knows where and how he will make them, and he needs to turn his attention to the getting the products to the customers. As he chooses retail partners, which of the following is least important in this process?
encouraging new bicycling enthusiasts
Amber has developed a line of organic lotions and handmade soaps with unique, herb-based scents and a touch of bee balm. She plans to sell these products to the wealthy residents of a nearby resort town. Which level of distribution intensity is probably best for this product?
exclusive
Anbinh Fashions is launching a new line of one-of-a-kind designer jewelry. Each piece is handcrafted, and production volumes will be very low. To emphasize the unique nature of this jewelry, Anbinh Fashions will most likely choose _________ distribution.
exclusive
Heartland Plantation produces organic food products like stone-ground grits and wild rice. The company has limited production capacity and wants to carefully control where its products are sold. Heartland will likely choose __________ distribution intensity.
exclusive
An ________ is a brand that is developed by a national brand vendor, often in conjunction with a retailer, and is sold exclusively by the retailer.
exclusive brand
Ryan is debating how to allocate the IMC budget for his new ski equipment store. He knows having knowledgeable salespeople in his store can simplify buyers' purchase decisions. He should also consider that, compared to other IMC alternatives, personal selling is
expensive
Production of the DeLorean car, made famous in the film Back to the Future, never got above 25,000 units during its lifetime. Automobile industry analysts estimate that production of this car needed to reach around 300,000 units to achieve the __________, which refers to a decrease in unit cost as product volume increases.
experience curve effect
The __________ occurs when unit cost drops as the quantity sold increases.
experience curve effect
Higher-income consumers visiting __________ feel like they are on a treasure hunt, searching for a bargain.
extreme value retailers
Which type of store is small and offers a limited merchandise assortment at very low prices?
extreme value retailers
Most manufacturing and retailing marketers worry constantly about whether or not their IMC efforts are paying off. They assess various forms of __________ to determine what is working and what is not.
feedback
Sales data, complaints, compliments, and redemption rates for coupons and rebates are types of __________ marketers use to assess the effectiveness of their IMC efforts.
feedback
The _____________ loop allows the receiver to communicate with the sender in the IMC process.
feedback
The sender of an integrated marketing communication
has little control over what meaning any individual receiver will take from the message.
Each time a politician or celebrity writes a book, bookstores can expect at least some customers to want the book, but whether or not it will become a best seller is less certain. The bookstore's primary inventory management challenge is
having enough books to satisfy customer demands versus the cost of having inventory.
Dan is especially price sensitive. He has been known to line up on "Black Friday" (the day after Thanksgiving) at 4 a.m. to be among the first to buy sale items. Dan would likely respond to a _______ pricing strategy.
high/low
In a(n) _______ pricing strategy, marketers rely on the promotion of sales, during which prices are temporarily reduced to encourage purchases.
high/low
If all three grocery stores in town decide to charge the same price for a gallon of milk, what type of pricing tactic is being used?
horizontal price fixing
Traditionally, retailers treated all their customers ________, but today, successful retailers ________.
identically; provide more value to their best customers
Kelly is the head of marketing for a nonprofit agency that supports the arts. She just received the go-ahead from her board of directors to conduct the agency's first-ever advertising campaign. Her first step will be to
identify the target audience.
The __________ stage of the advertising campaign planning process can be described by the question, "Whom are we trying to talk to?"
identifying target audience
Each generation of cell phones has provided greater clarity, range, security, and multifunctionality. If marketers of cell phones use these features as a basis for pricing, they would be using _______ pricing.
improvement value
In determining the price of his company's new small-business accounting software, Raymond is assessing how much better his company's software is as compared to alternative products available in the market. Raymond is using _______ pricing.
improvement value
How does a retail distribution center supporting a store channel most obviously differ from one supporting an Internet channel?
in quantity of items shipped
Retailers in expensive resort areas often find it difficult to hire quality salespeople. In a situation like this, retailers should consider augmenting or even replacing the sales and customer service functions with
in-store kiosks or self-checkout lanes
Kim wants to maximize sales to the customers who walk into her store. Of the following, Kim will most likely focus on
in-store promotions
Unusual and exciting displays like Bass Pro Shops' climbing wall and stocked aquarium are examples of
in-store promotions.
Tess is the marketing manager for a fast-food restaurant chain. She uses a target return pricing strategy because her firm's primary objective is to
increase profits
After creating awareness that the firm's products or services exist, the next goal of integrated marketing communications is to
increase the level of interest among consumers.
Internet buyers are sometimes surprised to see online retailers using information about their past purchases to customize promotions targeted to them the next time they visit the retailer's website. The retailer is using the information to
increase the share of waller from their best customers.
Retailers focusing on increasing sales to their best customers are attempting to
increase their share of wallet.
The knowledge retailers can gain from their store personnel and customer relationship management databases is valuable for developing
increased customer loyalty.
A major factor contributing to the growth in the use of direct marketing IMC efforts is
increased use of credit and debit cards, and online shopping by consumers
Naomi is the IMC manager for a chain of regional income tax service providers. Franchisees pay a percentage of their revenue to an IMC account allocated to her. As she establishes the short-term goals for her firm's IMC efforts, her goals are likely to include
increasing inquiries, awareness, and trial of her firm's services.
Lamar is assessing the long-term effectiveness of his firm's IMC efforts. He will probably analyze the firm's success in
increasing market share, sales, and customer loyalty.
In a(n) __________ marketing channel, several independent members each attempt to satisfy their own objectives and maximize their profits, often at the expense of the other members.
independent
A local furniture store buys furniture from various manufacturers and resells the furniture to its customers. What type of marketing channel does this represent?
indirect
In a(n) _______ marketing channel, one or more intermediaries work with manufacturers to provide goods and services to customers.
indirect
Dynamic pricing is also referred to as _______ pricing.
individualized
Retailers often perform ticketing and marking functions in their distribution centers rather than in their retail stores because ticketing and marking is often
inefficient and expensive.
A study found that, among addicted smokers, a 10 percent increase in the price of cigarettes resulted in a 2 percent decrease in quantity demanded. For these consumers, cigarettes have a(n) _______ price elasticity demand.
inelastic
After identifying the target audience for the university's new advertising campaign, the advertising team needs to decide whether the advertising objective is to __________, __________, or __________ potential and/or existing students
inform, persuade, or remind
Generally speaking, all advertising messages are designed to
inform, persuade, or remind customers
Estella is trying to create an advertising message that communicates the tangible features of her company's laptop computers, telling consumers about the relative advantages of her products as compared to other offerings in the market. Estella is trying to create a(n) __________ appeal.
informational
Jamara knows that his spring break travel packages are the best deal on campus. He also knows his competitor is sloppy, often waiting until the last minute to provide the needed tickets and documents to students buying his island packages. Jamara wants to develop an advertising message that emphasizes the key benefits he provides. He will develop a(n) __________ appeal.
informational
"Now available—the latest fall fashions" is an example of a(n) __________ advertising message.
informative
Price skimming focuses on selling products to __________ and __________ in the consumer adoption process model.
innovators; early adopters
The California Raisin Advisory Board used to run ads featuring "The California Raisins," a fictitious R&B musical group composed of dancing raisins that boogied to the song "I Heard It Through the Grapevine." The ads, which were hugely popular and which gave rise to a line of raisin-themed merchandise, were designed to encourage raisin consumption. This campaign was an example of
institutional advertising
Some companies want to get their products into as many outlets as possible, understanding that the more exposure a product gets, the more it will sell. If this is consistent with the company's overall strategy, it will choose __________ distribution.
intensive
When Creative Pen Company designed a new pen that was particularly comfortable to use, it wanted to literally get the pen in the hands of as many consumers as possible. Creative Pen will probably choose __________ distribution for its new product.
intensive
Which of the following strategies is designed to place products in as many outlets as possible?
intensive distribution
Distribution intensity is commonly divided into three levels:
intensive, exclusive, and selective
Which of the following is not one of the steps from the AIDA model?
intention
As firms become more sophisticated in their communication efforts, the trend is toward company blogs becoming more
interactive
When supply chain members view their goals and ultimate success as intricately linked, or ________, they develop deeper long-term relationships.
interdependent
In the AIDA model, awareness leads to
interest, which hopefully leads to desire and then action
Carlos owns a chain of retail electronic stores. He is evaluating how he allocates his firm's IMC budget. He receives offers from a variety of advertising media, spends money on his firm's public relations efforts, and is considering electronic media alternatives. Carl must recognize that each IMC alternative
is part of the whole.
A strategy of setting prices based on how customers develop their perceptions of value can often be the most effective pricing strategy, especially if the strategy
is supported by consistent advertising and distribution strategies.
Compared to mass media advertising, a key advantage of direct marketing is
it allows for personalization of the message
One of the limitations associated with break-even analysis is that
it assumes that there is only one price.
Students of marketing often overlook or underestimate the importance of place in the marketing mix simply because
it happens behind the scenes
The observation that consumers are generally more sensitive to price increases than to price decreases suggests that
it is easier to lose customers with a price increase than to gain customers with a price decrease.
One reason marketers of new, innovative products often start out with a price skimming strategy rather than a market penetration strategy is that
it is easier to lower prices than to raise them.
One difficulty associated with using advertising as part of a marketer's IMC efforts is
it is hard to break through the clutter of other messages targeted for the same audience.
One of the difficulties associated with value-based pricing is that
it necessitates a great deal of consumer research to be implemented successfully.
Which of the following retail stores would emphasize personal selling the most as part of the firm's promotional efforts?
jewelry store
At the BMW plant in Spartanburg, South Carolina, rather than use a typical order-to-delivery process, it has suppliers deliver parts every four hours when the plant is in operation. BMW uses a _______ inventory control system.
just-in-time (JIT)
Manufacturers trying to implement a just-in-time delivery system need to start with
knowledge of customer demand
One of the difficulties in measuring the effectiveness of IMC efforts is the __________, where consumers do not act immediately after receiving a marketing communication.
lagged effect
Today, __________ dominate supply chains.
large retailers
After installing an electronic data interchange, Carmella's gift shop was able to reduce _______, the amount of time between the recognition that an order needs to be placed and the arrival of the needed merchandise.
lead time
The amount of time between the recognition that an order needs to be placed and the arrival of the needed merchandise at the seller's store to be available for sale is referred to as
lead time
Supermarkets often offer great deals on milk or eggs to get customers into their stores, knowing that many customers will also purchase items that have higher markups for the store. These supermarkets are using a _______ pricing tactic.
leader
In which of the following tactics does a consumer pay a fee to purchase the right to use a product for a specific amount of time?
lease
The primary reasons manufacturers offer seasonal discounts to retailers are to more easily plan production schedules and to
lessen inventories of finished goods.
The additional sales that can be attributed to an advertising campaign are known as
lift.
As the old cliché claims, the three most important things in retailing are
location, location, location
Which of the following is not a common business-to-business pricing tactic?
loss leader pricing
For marketers using a price skimming strategy, once the initial demand is met for new and innovative products, they will likely
lower the price to capture the next most sensitive market segment.
Which of the following is not one of the broad factors manufacturers must consider when establishing a strategy for getting their products into the hands of the ultimate customer?
lowering production costs
While JIT systems have many benefits, they
make the logistics function more complicated.
Brent is working on an advertising campaign to promote downtown businesses. He knows the increasing number of advertising communication channels available and changes in consumers' media usage
makes his job more difficult
In the past, __________ controlled supply chains.
manufacturers
Because advertising is the most visible form of marketing,
many people think of marketing and advertising as synonymous.
When a new product is not being sold at the rate originally forecasted, the retailer may reduce the price in order to reduce the inventory of the product. This reduction is known as a
markdown
Retailers use _______ to get rid of slow-moving or obsolete merchandise.
markdowns
Mario is the first retailer in town to sell games for Sony's new PlayStation 4 machine. Mario wants to quickly capture as much of the market for the new games as possible. Mario will likely use a __________ pricing strategy.
market penetration
With a __________ pricing strategy, marketers set a low initial price for the introduction of a new product or service.
market penetration
It is the responsibility of __________ to determine the ethical approach to setting prices so consumers find value and the firm can make a profit.
marketers themselves
A(n) __________ is the set of institutions that transfer the ownership of and move goods from the point of production to the point of consumption.
marketing channel
Retailers use __________ to get customers into their stores.
mass media advertising
The execution style of an advertising message must
match the medium and the objectives.
A _______ strategy involves accurately measuring all the factors needed to predict sales and profits at various price levels, so that the price level that produces the highest return can be chosen.
maximizing profits
Walmart's "Everyday low prices" selling proposition is effective primarily because it is
meaningful to the customer
Ashley was nervous about making the ___________. She knew it was likely to be the largest expense in the advertising budget.
media buy
The __________ is the combination of media used and the frequency of advertising in each medium.
media mix
When Microsoft introduces a new version of its Windows operating system, it typically uses selected magazine, Internet, and direct mail advertising. This combination of advertising outlets represents Microsoft's
media mix
Charming Charlie's, a fashion accessories retailer, encourages visitors to its stores to "check in" using a smartphone app. In return, customers receive an instant coupon toward that day's purchase. This is an example of
mobile marketing
The Salvation Army runs a campaign over the Christmas holidays called the Mobile Bell Ringer. Volunteers send text messages to their friends' cell phones asking them to donate. Which type of marketing communication does this represent?
mobile marketing
Which of the following is being used by a store owner who sends out a text message to all of her preferred customers announcing the arrival of this season's new clothing?
mobile marketing
If a firm in a purely competitive market can differentiate its product or service, it becomes part of a(n) _______ market.
monopolistic competition
In a market with _______ there are many firms providing differentiated products.
monopolistic competition
In a vertical marketing system, if the system is _______, the less likely conflict will occur.
more formal
With more frequent shipments associated with quick response (QR) systems, a retailer is
more likely to have what customers want.
Special in-store displays for magazines and chewing gum are most likely to be effective if located
near the checkout counter
Developing pricing strategies for __________ is one of the most challenging tasks a manager can undertake.
new products
Pricing _______ products is especially challenging because little or nothing is known about consumers' perceptions of its value.
new-to-the-world
An advertisement for Titleist golf balls that airs on the cable television Golf Channel station is an example of what type of media channel?
niche
When comparing the various communication channels available to marketing professionals, it becomes apparent that
no single channel is better than another channel.
Though a picture may be worth a thousand words, the most important facet of encoding is
not what is sent, but rather what is received.
Julie is developing a budget for her firm's IMC program. First she sets objectives. Then she chooses media, and finally she determines the cost for each product to be promoted. Julie is using the __________ method of establishing an IMC budget.
objective-and-task
For consumers, shopping in a retail store instead of online offers the unique benefits of participating in a social experience and
obtaining immediate gratification.
Because of the way __________ buy merchandise, customers can never be confident that the same merchandise will be in stock each time they visit the store.
off-price retailers
If you were a marketer for a clothing manufacturer and you wanted to improve revenues from irregulars, production overruns, and returns, you would be attracted to using
off-price retailers.
For a price skimming strategy to work, the product or service must
offer consumers some new benefit currently unavailable in alternative products.
The commercial airline industry is considered what type of market?
oligopolistic competition
When using the objective-and-task method of IMC budgeting for multiple products and services, how often must the process be repeated?
once, for each individual product and service
Sales promotions include all of the following except
online ads
While it is relatively easy to offer customers Internet options like an FAQ page and an e-mail address to answer questions, some companies are using an interactive approach to address customers' questions while they are visiting the websites. These firms are using ___________ to provide the customer with enhanced customer service.
online chats
As an omnichannel retailing operation matures, as in the case of Walmart, what tends to happen to its organizational structure?
operational integration of all channels
Price is the _____________ a consumer is willing to make to acquire a specific product or service.
overall sacrifice
In a corporate vertical marketing system,
participants—such as warehouses, transportation companies, and retail outlets—are typically owned by a parent company to ensure harmonious relations throughout the supply chain.
Felicia had just taken over her family's business after spending ten years in the marketing department of a large corporation. She met with a representative from one of her firm's biggest customers, who told her, "We should think about how we can make the pie bigger rather than fighting over the size of the slices." She had expected a more cutthroat approach rather than this call for a
partnering relationship
The individual elements of an IMC strategy can be viewed on two axes: __________ (from the consumer's perspective) and ________.
passive and interactive; offline and online
Cross-price elasticity is the
percentage change in quantity demanded of product A compared to the percentage change in price of product B.
John used to work for a large, well-known retailer. He left that company to work for a much smaller company, and in doing so, he discovered that the channel functions were handled very differently in the smaller firm. Looking back at his experience, he noticed that larger firms
perform many different channel functions themselves
Andy purchased a number of books from Amazon.com, and he learned to trust the recommendations made to him. More than once he was pleasantly surprised at the books and authors he discovered this way. In this case, Amazon.com was creating value for Andy through
personalized offerings.
Advertising slogans such as "Don't text and drive" and "Buy flood insurance before it is too late" are examples of ads designed to
persuade consumers to take action.
P&G's Tide laundry detergent has been around since 1948 and is still a market leader. P&G has used __________ advertising to reposition Tide several times over the product's life, trying to motivate new consumer segments to use the product.
persuasive
When a product has gained a certain level of brand awareness, firms use __________ advertising to motivate consumers to take action.
persuasive
Campbell's Soup Company ran a series of radio ads tied to local weather forecasts. Before an impending storm the ads said, "Time to stock up on Campbell's Soup." During the storm the ads said, "Stay home and stay warm with Campbell's Soup." The first ad was __________ advertising, while the second ad was __________ advertising.
persuasive; reminder
Jennifer has worked for many years reviewing and approving print ads for her firm. She has memorized a checklist of key points to review. Which of the following would not be on her checklist?
photo credits
A(n) __________ is a document used by a forklift driver indicating how much of each item to get from specific storage areas.
pink ticket
Which element of the marketing mix specifically deals with supply chain management?
place
In the early stages of an ad campaign, the objectives are established. To determine if those objectives have been met, the marketer will
posttest.
A major airline sells an aggressively low priced ticket compared to a new low-fare airline which is trying to enter the market. The airline may be accused of engaging in the unethical practice of
predatory pricing
If a telecommunications company drastically cuts the price for cellular phone service in order to eliminate local competitors, the company could be charged with
predatory pricing
Sharon knew that her established customers liked her product much better than her competitor's. She was planning to expand into new markets, and she was considering pricing. She was leaning toward charging a higher price than competitors to help demonstrate that hers was a high-quality product. Sharon was considering
premium pricing.
Chet was struggling selling his golf photography outside a PGA event. When he offered a tee shirt with a golf photograph on it with any framed golf photo, sales picked up. Chet discovered the value of sales promotions—specifically _________—in encouraging customers to buy.
premiums
For which of the following is demand likely to be least sensitive to price increases?
prescription drugs
There is an old saying "If you have to ask the price of a yacht, you cannot afford it." Products like yachts are most likely to be associated with
prestige pricing
Marketers __________ an advertising campaign to ensure that various elements of the campaign will work in an integrated fashion and do what they are intended to do.
pretest
A demand curve shows the relationship between _______ in a period of time.
price and demand
Cosmetic manufacturers that sell shampoo and conditioner together as one package at a lower price rather than selling each item separately are using
price bundling
The Clayton Act and the Robinson-Patman Act forbid certain types of
price discrimination
Barry customizes Harley-Davidson motorcycles. No two cycles are alike. He notices that very few customers even ask the price of his motorcycles before they decide to purchase them. Demand for his motorcycles is probably
price inelastic
If a 1 percent decrease in price results in less than a 1 percent increase in the quantity demanded, demand is
price inelastic
Because there are many firms with similar products in purely competitive markets,
price is determined by the laws of supply and demand.
When Toyota introduced its Scion line of cars, the lowest-price model was listed for $15,000 while the highest-priced model was listed for $21,000, with two other list prices in between. Each price point represented distinct differences in the features and quality of the cars. Toyota used a ______ pricing approach.
price lining
Everyday low pricing (EDLP) provides value to consumers by
reducing their search costs.
The contribution per unit is
price minus variable cost per unit.
When Apple Computer Company introduced the iPhone—a combination phone, MP3 player, and Internet access device—in 2007, it was priced at $499, considerably higher than either the iPod or competing cell phones. Hoping to attract innovators and early adopters, Apple was most likely pursuing a __________ pricing strategy.
price skimming
Because there are only a few firms in markets with oligopolistic competition,
price wars may occur.
In omnichannel retailing, what visible element must often be adjusted because of competition faced in different channels?
pricing
Retailers' coupons, rebates, and online discounts are types of
pricing promotions.
Generally, a _______ represents either a short-term response to a competitive threat or a broadly accepted method of calculating a final price for the customer that is short term in nature.
pricing tactic
Actor Sissy Spacek once objected to a series of movie scenes that included her smoking a certain brand of cigarettes. She was probably objecting to a __________ arrangement the film company had made with an advertiser.
product placement
Personal selling is particularly important for retailers selling
products that are complicated or expensive.
At the break-even point,
profits are zero.
Henri wants customers in his specialty tobacco store to feel at home, as if they were in their personal smoking den. He uses lighting, music, and soft chairs to create a "look and feel" that will get customers to relax and return. Henri is focusing on which aspect of the marketing mix?
promotion
Integrated marketing communications represents the __________ element in the four Ps of a firm's marketing mix.
promotion
Reminder advertising is primarily used to
prompt repurchase of a product
In the United States, the regulation of advertising involves a complex mix of laws and informal restrictions designed to
protect consumers from deceptive practices.
Benefits of the traditional retail store as a channel include the ability to
provide personalized and meaningful product information.
Naomi knows she has to order her store's Christmas holiday merchandise in April to ensure delivery before the holiday season. Naomi is concerned with the supply chain management goal of
providing products at the right time.
A firm that places an emphasis on developing and maintaining positive relationships with the media is focusing on a ________ strategy.
public relations
All of the following are interactive elements of an IMC strategy except
public relations
Gretchen has just started as a fashion marketing intern for an up-and-coming design firm. She expected to begin right away implementing the four Ps she had learned about in class. Instead, she was asked to work on a project identifying important events where celebrities might wear the fashions. Gretchen soon realized that this activity was part of __________, directly related to marketing.
public relations
Whenever the major beverage companies develop a new product, they advertise it heavily using television and print media. These efforts are designed to
pull the product into retail stores through consumer demand
A ____________ advertising schedule uses a base level of advertising during some periods followed by periods of increased advertising
pulsing
Gypsy just bought a gift and jewelry store on Main Street. She knows from the previous owner that almost 60 percent of her sales take place during the Christmas holiday season, with the other 40 percent of sales evenly distributed over the rest of the year. Gypsy will probably use a __________ advertising schedule.
pulsing
In _______ many firms provide similar products that are considered substitutes for each other.
pure competition
Anne's Pita Bread Chips offers free POP (point-of-purchase) displays to retailers ordering its product. Anne's is using a __________ strategy
push
Florida Heat Pump Manufacturing Company is offering a free, all-expenses-paid trip to Las Vegas for HVAC dealers that sell at least 20 units this year. Florida Heat Pump is using a __________ promotional strategy
push
In retailing, a just-in-time delivery system is called a _______ system.
quick response (QR)
The major objectives associated with a market penetration pricing strategy are to
quickly build sales and market share.
Historically, prices were
rarely changed except in response to radical shifts in market conditions.
Julia wants her firm's gourmet snacks to be the leading brand in the U.S. market. When adopting a pricing strategy designed to gain market share, she should remember that
rarely is the lowest-price offering the dominant brand in a market.
Mary decided to purchase an electronic toothbrush priced at $100 because of a special offer from the manufacturer. By sending proof of purchase and the receipt to the manufacturer, she could receive a $40 check in return, making the final price $60. This pricing tactic is known as
rebate
Firms are willing to offer generous rebates because
rebates increase sales, but firms may not have to pay off all the rebates offered.
In the IMC communication process, the __________ is the person who reads, hears, or sees and processes the message being communicated.
receiver
Because manufacturers with JIT systems produce merchandise closer to the time of sale, they can
reduce inventories needed to satisfy retailers' demand.
Brad always buys and uses Nike brand golf balls. If he finds a Titleist or Callaway ball in the rough, he gives it away. Brand-loyal golfers like Brad allow Nike to charge a higher price and not lose many sales. By building a strong brand, Nike has effectively
reduced the price elasticity of demand for its products.
Marketers spend millions of dollars annually trying to create or reinforce brand loyalty. Brand loyalty changes the demand curve for the firm's products by
reducing the price elasticity of demand.
In determining the price for his company's new pocket digital camera, Matt determines what consumers consider the regular or original price for similar cameras available in the market. Matt is assessing the influence of __________ on pricing strategy.
reference prices
The advantage of zone pricing to the seller is the shipping charges typically
reflect more closely the cost of delivery.
For marketers to advertise a price as their __________ price, the Better Business Bureau recommends that at least 50 percent of the sales of a product occur at that price.
regular
A measure termed _______ describes how useful an ad message is to the consumer doing the search
relevance
Each year in December, Anheuser-Busch runs television ads featuring the Clydesdale horses pulling a stagecoach with an Anheuser-Busch logo. The message is low-key, wishing everyone well during the holiday season. This is an example of _________ advertising.
reminder
David manages a Shoney's restaurant. He is considering staying open later in the evening. For David, the variable costs associated with staying open longer hours will include all of the following except
rent on the restaurant building.
If marketing communications are effective, they will
result in purchases by some consumers receiving the communications.
When Costco sells to consumers directly, it acts as a _______; when it sells to other businesses, such as a restaurant owner, it acts as a _______.
retailer; wholesaler
In vendor-managed inventory systems,
retailers send sales information to the manufacturer.
A distribution center is typically operated by
retailers, manufacturers, or distribution specialists.
When Joe's Chicken Shack wants chicken delivered in smaller batches more frequently, it offers its distributors an incentive in the form of special bonuses to change their schedules. Joe's demonstrates which kind of power?
reward
Using prior sales and communication activities to determine the present communication budget describes which method of IMC budgeting?
rule-of-thumb
Gary is the marketing manager for an automobile dealership. His boss tells him the firm's primary goal is to increase its local market share from 15 to 30 percent. His firm is using a ________ orientation.
sales
Health clubs often use a low, introductory offer price to get people to join their club. These low prices represent a _______ pricing strategy.
sales orientation
Many years ago Honda's Accord and Ford's Taurus were the two top-selling cars in the United States. As the year was coming to an end, Ford cut the price of the Taurus, hoping to outsell the Accord and allow Ford to claim that "Taurus is the best-selling car in America." Ford was using a _______ pricing strategy.
sales orientation
Red Bull sends out student brand managers to distribute free samples to their peers. What form of marketing communication is this?
sales promotion
Traditionally, marketers have seen the role of __________ as generating short-term results, whereas the goal of __________ was to lead to long-term results.
sales promotion; advertising
Jim was asked to determine the ROI for a particular advertising effort. To do so, he needs to know
sales revenue and advertising cost.
Bernard's firm has set corporate direction to become one of the leaders in each of its significant market segments. It was Bernard's job to examine the firm's pricing strategy to determine how to maximize market share, even at the expense of profits in the short run. What kind of company objective would guide Bernard's effort?
sales-oriented
Customers interacting with omnichannel retailers most desire a ________ experience.
seamless
The local furniture store will purchase outdoor furniture only during the winter months because the manufacturer offers a better price to the furniture store. This type of pricing tactic is known as a
seasonal discoiunt
When Toro offers its lawn mower dealers an additional discount if they place their orders and receive delivery before April 1, prior to the lawn mowing season, Toro is offering a
seasonal discount
Price reductions offered on products and services to stimulate demand during off-peak seasons are referred to as
seasonal discounts
A __________ distribution intensity helps a seller maintain a particular image and control the flow of merchandise into an area.
selective
If a manufacturer wasn't happy with either intensive or exclusive distribution, a logical choice, which incorporates some features from both, would be __________ distribution.
selective
Stores like Home Depot and Costco act as wholesalers when they
sell to contractors or restaurant owners
In a television commercial for Chobani Greek yogurt, the manufacturer Chobani plays which role in the communication process?
sender
In which of the following categories would a dry cleaning business be placed?
sercives retailer
Carol's Studio, located in a shopping mall, offers Zumba dance classes for all ages. Carol's Studio is known as a
service retailer
Johan owns an oil-change business called Oil Only. He changes oil in cars—and that is all he does. What kind of retail business is this?
service retailer
Jackie is running errands on Saturday morning. First, she drives through CVS pharmacy to pick up a prescription, stops at the tailor to pick up a dress she had hemmed, and then heads to her manicure appointment. What kind of retailers is Jackie visiting?
service retailers
After using market research to identify the target audience for his advertising campaign, Jorge will next use this information to
set explicit and measurable objectives for the campaign.
Marlie designs and manufactures specialty furniture. She has a number of unique products but can only produce in limited quantities. Marlie will probably not use a market penetration strategy because
she could not meet a rapid rise in demand.
Janelle is shopping for a unique outfit for a benefit dinner dance. She wants it to sparkle and shine, but still feel light, silky, and comfortable. For the highest satisfaction, Janelle likely should
shop in traditional retail stores
Regina just bought a gourmet bagel store. She is working with a freelance graphic artist who is designing her logo and print advertisements. Regina is spending days looking over the various designs and color options. She needs to remember that the creative aspect of advertising design
should not overshadow the message
The most common form of a quantity discount for consumers is a
size discount
Charging a relatively high price for new and innovative products to those consumers most willing and able to pay the high price is called price
skimming
When Burroughs Wellcome introduced the first anti-AIDS drugs, it initially set the price at $10,000 for a year's supply. Burroughs Wellcome was probably pursuing a(n) __________ pricing strategy.
skimming
Fees paid to retailers simply to get new products into stores or to gain more or better shelf space for their products are called _______ allowances.
slotting
Which of the following markets is most likely to be characterized by oligopolistic competition in the United States?
smartphone service providers
Firms can use __________ to bring customers together to share experiences around the products.
social media
When developing an advertising message, the message should focus on
solving problems for consumers
Which of the following is most likely to be characterized by pure competition in the United States?
soybeans
If you are a marketer for a manufacturer, and the marketing mix for your product focuses on very specific market segments, you'd like to sell your product through
specialty stores.
Regardless of the objective of an advertising campaign, each campaign's objectives must be
specific and measurable
The head of the marketing area told Alex to find the most stringent federal regulations on advertising to create the toughest standards. "If we can pass those, we should be able to get by all regulations." One real problem is
state regulations are not always consistent with federal standards.
Ryan gave the manager of his convenience store a set of binoculars so she could see the gasoline prices charged by the other convenience store at that intersection. Ryan told the manager to always match the gasoline prices of the other store. Ryan is using a _______ pricing strategy.
status quo
Several years ago, changes in advertising restrictions allowed pharmaceutical companies to begin promoting their products through traditional media. Today, it is common to see ads on television ending with, "Ask your doctor about (our medicine)." In addition to creating awareness about their drugs, the companies are most likely hoping to
stimulate interest, persuading consumers to investigate further.
Steven managed an auto parts store in the 1990s. At that time, stockouts—failure to have the parts auto mechanics needed to do their work that day—increased the likelihood of the mechanics becoming customers of competing auto supply stores. To avoid this problem and keep his business customers, Steven most likely
stockpiled inventory, adding to the cost of providing auto parts.
Retailers address the conflict between consumers wanting or needing only one item and manufacturers wanting to produce and ship in quantity by providing
storage
TT TOYS manufactures toys. The company recently started buying paint for its toys from a Chinese firm. This Chinese company is part of TT Toys'
supply chain
Which of the following is not a communication channel used in the IMC process?
supply chain
Integrated marketing communications include all of the following except
supply chain management.
Public relations is the component of IMC that
supports other promotional efforts by generating "free" media attention.
Unlike advertising, public relations
supports promotional efforts by generating free media attention.
Sarah goes through the newspaper looking for coupons to help reduce her living expenses. Her roommate Paige doesn't read newspapers, let alone look through them for coupons. But Paige filled out a form from inside a cereal box entering her in a drawing for free exercise equipment. What kind of sales promotion reached Paige?
sweepstakes
Some consumers make it a point to go shopping the day after Christmas to stock up on discounted wrapping paper and bows for the following year. These consumers are
taking advantage of seasonal discounts
Naomi tells her sales representatives the goal is to generate at least a 20 percent return on investment for all of the industrial building supplies they sell. Naomi is using a _______ pricing strategy.
target return
Advertising in which medium relies on a mix of visual and auditory techniques?
television
Brett has developed a vitamin-enriched crouton in crazy colors that can be added to children's salads to make them more nutritious and fun. She'd like to ethically advertise the product directly to the children, so she is examining
the Better Business Bureau's Children's Advertising Review Unit guidelines.
One of the greatest constraints faced by store-based retailers—and one that the Internet channel can address—is
the amount of merchandise that can be carried in a physical store.
Loretta would like to know which, if any, of her firm's IMC efforts are working. She could use all of the following except __________ to provide feedback from her efforts.
the channel
The content of an advertising message is closely tied to
the characteristics of the media selected to carry the message.
Because market and operating conditions are different in each target market
the choice of a pricing strategy should be specific to the target market.
If you send an e-mail and include a link, you can track how many people took the desired action of clicking on the link. This is known as
the click-through rate
Jami is managing an extended advertising campaign for a local convenience store chain. The campaign includes a series of television, radio, and print messages. As part of monitoring the campaign, which of the following offers a good indicator of advertising effectiveness?
the daily and weekly sales volume
B2B quantity discounts are legal if
the discounts are available to all customers.
When a manufacturer chooses one or more retailing partners, the overriding consideration must be
the greatest possible customer convenience and satisfaction
Rodi owns Hallman's auto repair service. He has observed over the years that customers keep their high-mileage cars longer when the economy is doing poorly, creating demand for his maintenance and repair service. Rodi has observed the impact of ______________ on demand for his service.
the income effect
Sales of national brands of orange juice tend to increase when the economy is doing well, while sales of generic orange juice increase when the economy is not doing well. This is an example of how _______ impacts demand for products.
the income effect
Natalie operates on a pretty tight budget. She is a price-conscious shopper and usually buys store or generic brands to save money. Recently, however, Natalie was given a pretty substantial raise. As such, she has altered her shopping patterns and now regularly buys more expensive, name-brand goods. This is an example of
the income effect.
Retailers can gain valuable knowledge about their customers from the transaction process and from
the insights of the store personnel.
Julia is driving down Interstate 95 on her way from New England to Florida and sees a billboard saying "South of the Border Restaurant and Motel is just 100 miles away." Julia has never heard of South of the Border before. After seeing the sign, she will most likely need additional exposure to the product before deciding whether to stop at South of the Border. This is an example of
the lagged effect
According to a typical demand curve, the higher the price,
the lower the quantity consumers will buy.
Because there are many firms in monopolistic competition markets,
the many competitors will focus on product differentiation.
Reaching the right audience with marketing communications is becoming more difficult because
the media environment has become more complicated
Earl was known for driving 30 miles just to save a dollar on the price of his favorite beverage. Earl perceived price as _______ for a good or service, while most consumers recognize price as the _______ made to acquire a good or service.
the money paid; overall sacrifice
The more substitutes that exist in a market,
the more sensitive consumers will be to changes in the price of a particular product.
To estimate reach in terms of electronic media, marketers can use the click-through rate (CTR). To do so, they need to know the number of clicks and
the number of impressions
The right communication channel to use in IMC is
the one that will connect to the desired recipients.
The sender of an IMC message hopes the receivers are
the people for whom the message was originally intended.
A reference price is
the price against which buyers compare the actual selling price.
The full price of a product or service includes all of the following except
the price of alternative products and services
When a customer purchases a DVD at a Best Buy Electronics store, all of the following information flows in the supply chain are started except
the purchase is added to the customer's purchasing habit records.
Mira purchased some eyeliner from an Internet-based beauty supply house, and now she often receives online recommendations for other products from the same cosmetics line. These recommendations were probably the result of
the purchases she had made.
A reference price might be considered deceptive if
the reference price has been inflated or is fictitious.
One of the most fundamental activities of retailers is to provide __________, satisfying the needs of their target market.
the right mix of merchandise and services
In marketing's four Ps, place refers to all activities required to get
the right products to the right customer when that customer wants it
The IMC communication process begins with __________, who(which) must be clearly identified.
the sender
There are many options available to consumers when it comes to breakfast cereals. So, if Kellogg's significantly increases the price of Rice Krispies, consumers are more apt to buy alternate cereals instead. This illustrates which concept?
the substitution effect
Although conflict is likely to occur in any supply chain, it is generally more pronounced when
the supply chain members are independent entities.
One of the benefits of EDI is that it can reduce lead time, which is
the time between the decision to place an order and the receipt of the merchandise.
Manufacturers use cash discounts primarily because it allows them to benefit from
the time value of money
Cross-promotion is most successful when
the two products appeal to the same target market.
One product strategy used by retailers to differentiate themselves from competitors is
the use of the private-label brands
One problem in relying on price elasticity and demand curves when setting prices is
the way a product or service is marketed can have a profound impact on price elasticity.
Value-based pricing can be difficult to implement because
the way consumers perceive value constantly changes.
One important reason manufacturers like rebates is that
their redemption rate is lower.
In an administered vertical marketing system,
there is no common ownership, and the dominant member has significant power to impose its ideas and objectives.
Manufacturers use wholesalers and retailers because
they create value for customers through convenience and cost savings.
Gray markets can be a challenge to marketers because
they may tarnish the manufacturer's image.
The key factor distinguishing retailers from other members of the supply chain is that
they sell to customers for their personal use.
If a market penetration pricing strategy results in lower per-unit cost, competitors might be discouraged from entering the market because
they would likely need to quickly produce a large volume in order to compete.
In simple terms, the AIDA model is also known as the __________ model.
think, feel, do
Getting merchandise floor-ready entails
ticketing and marking.
Radio frequency identification tags are
tiny computer chips that transmit information about a container's contents.
Shorter lead times allow retailers
to reduce the needed level of inventories.
The highest level of awareness occurs when customers mention a specific brand name when asked about a product or service. Marketers call this
top-of-mind awareness.
Steve is working on the message to convey in his firm's advertising campaign. As a starting point, Steve should first consider
touting the key benefits of his firm's services
Thomas had conducted a thorough pretest before the new ad campaign, so he was fairly sure the elements would work together. A lot was riding on the success of the ad campaign, so he couldn't wait until the campaign was over to see how well it did. During the campaign, he will be monitoring the sales volumes on a daily basis as part of his
tracking
The effectiveness of an advertising campaign is assessed during the campaign by
tracking.
In the IMC communication process, the __________ encodes the marketing communication message.
transmitter
Leona is the logistics manager for the Barnes & Noble bookstore chain. She is weighing the many benefits of the company's JIT system, but will need to consider that just-in-time inventory management systems increase _______ costs.
transportation
Retailing is the primary activity in all of the following situations except
transporting pallets of Daisy brand dairy products.
Neville is trying to create an advertising message that tells consumers how his company's cell, pager, instant messaging, and Internet services differ from other alternatives in the market. Neville is trying to create a
unique selling proposition
Generally, the larger and more sophisticated the channel member, the less likely that it will
use supply chain intermediates.
The improvement value method and the cost of ownership method are two approaches for setting prices that are _______ methods.
value-based
A customer orientation toward pricing implicitly invokes the concept of
value.
Labor, materials, and energy are typically __________ costs.
variable
The local auto supply store gets merchandise delivered to it by its manufacturers as soon as it has a need, reducing stockouts with minimal inventory. This demonstrates the concept of
vendor-managed inventory
A __________ is a supply chain whose members act like a unified system.
vertical marketing system
To discourage consumers from buying in gray markets, some manufacturers have
warned consumers that warranties will become null and void if the product is purchased through a gray market supplier.
Knowing what customers expect is essential. Retailers need to know which manufacturers their customers prefer, while manufacturers need to know
where their target customers expect to find their products.
Today, retailers like Walmart, Home Depot, and Kroger dictate to their suppliers all of the following except
which competitors they should collaborate with.
Dawn works for a firm that buys products directly from the manufacturer and resells them to retailers, who then sell the products to consumers. Dawn works for a
wholesaler
One of the benefits of offering a size discount to consumers is they will purchase more of a marketer's product and
will be less likely to switch brands.
An advertising plan is crucial to an ad campaign because it
will later help measure the success/failure
Cost-based pricing assumes that costs
will not vary much for different levels of production.
Clark Manufactured Housing Company charges $500 for deliveries within 50 miles and $800 for deliveries 51 to 100 miles away from their factory. The company is using a _______ pricing tactic.
zone