Intro to Marketing, Chapter 10

What two advantages does a marketer gain by using direct distribution? (Check all that apply.) []Ability to transform its marketing mix rapidly []Close, mutually-beneficial working relationships with retailers and wholesalers []Sensitivity to shifts in customer moods []Ability to quickly convince channel members to adjust the marketing mix

*Ability to transform its marketing mix rapidly *Sensitivity to shifts in customer moods

What are two reasons an intermediary might be better suited to lead a channel than a producer? (Check all that apply.) []Because it avoids performing regrouping activities []Because it is far-removed from the final user []Because it is closer to the final user []Because it has data about the final user

*Because it is closer to the final user *Because it has data about the final user

What channel system would be best for a company to select to avoid selling to wholesalers and retailers that have a poor credit rating?

Selective

What is the best definition of place in marketing strategy?

The process of moving products from sellers to buyers Reason: Place involves the distribution of goods and services so that customers can buy them.

When channel members do not share a product-market commitment, they are involved in what type of channel system?

Traditional

True or false: When a company serves multiple target markets, it may choose to sell direct to consumers and also indirectly through intermediaries.

True Reason: A company can sell its products to different target markets by supplying an intermediary, such as a retailer and selling directly to the consumer.

True or false: A website allows small firms with narrow specializations to sell directly to customers across the globe.

True Reason: Website-based e-commerce systems and delivery services like UPS and FedEx give many firms direct access to customers whom it would have been impossible to reach in the past.

______ conflicts occur between firms at different levels in the channel of distribution.

Vertical

Which of the following is one of the fundamental Place decisions a producer must make? []Whether or not to conduct market research before beginning production []Whether or not customers will be willing to pay a higher price for the product []Whether or not customers will want the products []Whether or not to outsource distribution or handle it in-house

Whether or not to outsource distribution or handle it in-house

Which two of the following statements about market exposure are true? (Check all that apply.) []Ideal market exposure refers to offering more than enough of a product to satisfy target consumers' needs. []The amount of market exposure needed for a product to be successful differs from product to product. []Ideal market exposure makes just enough of a product available to satisfy the consumers' needs. []Maximum exposure is needed for a product to be successful.

*The amount of market exposure needed for a product to be successful differs from product to product. *Ideal market exposure makes just enough of a product available to satisfy the consumers' needs.

In an administered channel system, what types of agreements might channel members make? (Check all that apply.) []To keep ordering separate []To share inventory information []To vertically integrate []To work together on promotions

*To share inventory information *To work together on promotions

In which two instances do ethical dilemmas tend to occur in multichannel distribution systems? (Check all that apply.) []When customers' Place needs change []During the busy holiday season []When regrouping activities require all channel members to work together []When there are shifts in the competition

*When customers' Place needs change *When there are shifts in the competition

What are the four types of regrouping activities? (Check all that apply.) []Filing []Accumulating []Forwarding []Sorting []Bulk-breaking []Assorting

*accumulating *bulk-breaking *sorting *assorting

Business products are often sold through direct distribution because business customers tend to _____. (Check all that apply.) []be located in the same geographic area []purchase less frequently []purchase more frequently []place big orders []order in small quantities

*be located in the same geographic area *purchase less frequently *place big orders

What are the three types of vertical marketing systems? (Check all that apply.) []Corporate []Direct []Contractual []Competitive []Administered

*corperate *administered *contractual

What are the five approaches a firm might use to enter international markets? (Check all that apply.) []Exporting []Supply chain extension []Licensing []Joint venture []Direct investment []Management contracting []Horizontal conflict

*exporting *licensing *management contracting *joint venture * direct investment

Indirect distribution is best when an intermediary helps producers ______. (Check all that apply.) []serve customer needs better []serve multiple target markets []increase costs []lower costs

*serve customer needs better *lower costs

Jenna works for a company that manufacturers rain boots. Recently, the company started selling the boots directly to consumers online, but decided to stop this practice after receiving complaints from retailers who also sold the company's boots. What was Jenna's company hoping to accomplish by removing the online site?

Avoid conflict with the retailers

How does a licenser make money through licensing its process, trademark, patent, or other rights in international markets?

By collecting fees and royalties

Of all the approaches to entering an international market, which is the most financially risky?

Direct investment

Which of the following describes a parent firm having a division or subsidiary in a foreign market? []Licensing []Direct investment []Management contract []Joint venture

Direct investment

Which of the following refers to the difference between the quantity of products that is economical for a producer to make and the quantity final users or consumers normally want?

Discrepancy of quantity

______ distribution agreements can be affected by U.S. antimonopoly laws.

Exclusive

In addition to selling its products within the United States, a U.S. company decides to sell its products in Canada, Mexico and Costa Rica. It begins to ship surplus inventory to the other countries. What is the company's strategy to enter those foreign countries?

Exporting

True or false: The idea of a shared product-market commitment, when all channel members focus on the same target market, has traditionally been the way most firms have handled channel relationships.

False Reason: The shared product-market commitment is a new way of thinking.

______ arrangements, which competing channel members enter into, are considered illegal in the United States because they suppress market competition and negatively impact consumers.

Horizontal Reason: Competing channel members enter into horizontal arrangements which are considered illegal in the U.S.

What kinds of producers tend to lead channels?

Large producers

Before going to the book store to purchase the book, Manuel reads a review of the new novel on Amazon. What type of distribution does this represent?

Multichannel

Which factor in the marketing mix is usually the most difficult to adjust?

Place

______ decisions often have long-run effects and are harder to change than Price decisions.

Place

What part of the marketing mix concerns the distribution channels used to get a product to the consumer?

Place Reason: Place includes the movement of a product to the customer.

When domestic firms enter into partnerships with foreign firms, it is called ______.

a joint venture

Channel systems where the channel members informally agree to cooperate with each other are called ______.

administered channel systems

Some firms enlist a channel _____ to direct the activities of an entire channel. Multiple choice question.

captain

Ideally, all members of a(n) ______ should have a shared-product commitment.

channel

A manager who helps direct the activities of a whole channel and tries to avoid or solve channel conflicts is known as a(n) ______.

channel captain

Different channels can serve different target markets. This avoids ______.

channel conflict

A channel system in which the same owner owns the retailer, wholesaler, and producer is called (a)n ______ channel system.

corporate

In a(n) ______ channel system, a firm may play the role of producer, wholesaler, and retailer.

corporate

A company produces clothing and household items and sells them to customers via the Internet. This company is using a(n) _____ distribution system.

direct

Big Wave Entertainment is a newly-opened computer game developer. Although the company creates quality computer games, no intermediary will agree to distribute their products. In order to get its games to consumers, Big Wave may need to create a(n) ______ distribution system.

direct

In order to quickly clear a backlog in its beauty products inventory, Skinsation Inc. trained its sales representatives to promote these products when interacting with customers. Since Skinsation sells products during at-home parties, it uses a(n) ______ distribution system and has the ability to directly train salespeople.

direct

TaxWizard is a tax preparation company with millions of customers worldwide. Because their services are typically produced in collaboration with customers, TaxWizard may be said to use a(n) ______ channel of distribution.

direct

In some cases, a producer finds that there are no appropriate intermediaries for a product. In other cases, a producer finds that they cannot work well with existing intermediaries. In these situations, a producer may need to develop a(n) ______ distribution system.

direct Reason: An indirect system makes use of intermediaries. Without intermediaries, a producer may attempt to sell directly to its market.

Aloha Clothing is a manufacturer that promotes its products using Internet commercials and postcards that are mailed to target customers. Aloha Clothing uses _____ to reach its customers.

direct marketing

Direct communication between a seller and an individual customer using a promotion method other than face-to-face personal selling is called ______.

direct marketing

Barnum Manufacturing makes component parts for bicycles which it sells directly to companies that make the bicycles. This is an example of a ______ transaction.

direct-to-customer

Bose electronics sells its products through its own stores and website, which is known as a(n) ______ channel. Bose also offers its goods through intermediaries, such as various electronics stores. This is known as a(n) ______ channel.

direct; indirect

In order to maintain high prices, Luxe does not want its retailers to discount its watches. In addition, Luxe demands that its retailers offer only the highest level of service to its customers. The company only has one retail location in any city. Luxe uses a(n) ______ distribution system.

exclusive

When a company selects just one retailer in each geographic area to sell its product, it is using _____ distribution.

exclusive

Selling some of what the firm produces to foreign markets is called ______.

exporting

A reverse channel is a way for a company to ______.

get back its products from customers Reason: A reverse channel is used to retrieve products that customers do not want, such as in a recall situation.

Micah needs a new dishwasher and goes to the store where she seeks out a sales assistant who can provide information about the different models available. The dishwasher is an example of a _____ shopping good.

heterogeneous

Making a product available widely enough to satisfy target customers' needs but not exceed them is called ______.

ideal market exposure

Associated Farmers' Products is a new producer of fruit and vegetable products. The company uses wholesalers and retailers to get its goods to consumers. This is an example of a(n) ______ channel system.

indirect

Certain service firms can offer products only while the customer is present. Therefore these firms rarely use ___ distribution.

indirect

Camphor Inc. needed to sell more batteries. These are normally an impulse purchase; most people do not go out to a battery store on a regular basis. Camphor needs to pursue a(n) _____ distribution strategy.

intensive

Company offices prefer to have their business supplies conveniently available. This calls for producers of office supplies to choose a(n) ______ distribution strategy. Multiple choice question. exclusive

intensive

Amos & Sons used to sell its barbecue sauce only through high-end retailers. Recently, it has started selling the barbecue sauce through grocery chains as well. This is an example of moving from selective distribution to ______.

intensive distribution

Juan, a marketing manager at a company, decides to sell a product through all appropriate and willing intermediaries. Based on this choice, it is clear that Juan wants the product to have ______.

intensive distribution

Selling a product through all appropriate wholesalers or retailers who will stock or sell the product is known as ______.

intensive distribution

A woman visited a local and independent mortgage broker to secure a home loan. The independent broker was able to help her decide which one of the various mortgage products would best fit her needs. In this situation, the broker served as a(n) ______ who provided the buyer with information.

intermediary

Katrine doesn't understand all of the various aspects of automobile insurance and relies on her local independent State Farm Insurance agent to provide her with information. This agent acts as a(n) _____ for State Farm.

intermediary

There has been growth in multichannel distribution mainly because ______.

it is the way customers want to shop

In a(n) ______, the partners must work together to develop a mutually agreed upon marketing strategy for an international market.

joint venture

Selling the right to use some process, trademark, patent, or other rights for a fee or royalty is called ______.

licensing

The basic approaches for entering international markets includes exporting, management contracting, joint venture, direct investment and _____.

licensing

When shopping for homogeneous goods, consumers are most likely to focus on _____.

low price

The Blue Lagoon Corporation purchased the land, hired the building contractors, and built the facility for a seaside resort in Jamaica, but Marriott provides all of the management and marketing functions for the property. Marriott is using ______ to operate in this international market.

management contracting

When someone offers management and marketing skills and has nothing to do with production or distribution, this person is providing _____.

management contracting

Edmund and Edgar, a clothing manufacturer, sells its clothing and accessories on its website, at one Edgar and Edmund store in Los Angeles, and through the discount retailer Walmart. Edmund and Edgar is using ______ distribution to reach its customers.

multichannel

Ethical dilemmas can rise in ______ because not everyone will win.

multichannel distribution

Using several competing channels to reach the same target market is called ______.

multichannel distribution

It is more economical for Bob's Baseball Bats to produce thousands of bats each month even though consumer demand is not that high. This is an example of a discrepancy of _____.

quantity

Activities that solve discrepancies of quantity and assortment throughout an entire distribution channel are called ______ activities.

regrouping

Channels that are used to retrieve products that customers no longer want are called ______ channels.

reverse

The 80/20 rule is based on the idea that 80 percent of a company's _____ come from only 20 percent of its customers.

sales

In order to only use better-than-average intermediaries, Samson Co. uses _____ distribution.

selective

Michael Kors is a fashion designer who is best known for designing classic American sportswear for women. His company hand-picks retailers, with only a few in each town, to sell the clothing line. He uses ______ distribution to gain fairly widespread market coverage.

selective

In the early years, Nike sold its running shoes through retailers that catered primarily to the running market. Then, the company began offering products in many more retail outlets. You can now find Nike products in almost any retailer that carries footwear. Nike's distribution strategy moved from ______ to ______.

selective; intensive

An indirect channel of distribution is often the best choice because an intermediary can help a producer _____.

serve customers better at a lower cost

A multinational corporation produces many of the world's consumer product brands in the categories of food, beverages, cleaning agents, and personal care products, which are sold in many different retail stores. It would be common for this corporation to ______.

take the lead in channel relations

In 2015, Target was the second largest general merchandise retailer in the United States. As a retailer, Target has a good understanding of customer needs and purchases items from producers that they think will be popular with their customers. Therefore, it is not surprising that Target ______.

takes the lead in channel relations

In ______ channel systems, the various channel members make little or no effort to cooperate with each other.

traditional

Channel systems in which the whole channel focuses on the same target market at the end of the channel are called _____ marketing systems.

vertical

A video game retailer removed coupons meant for consumers from a new game's packaging. The producer of the game did not like this practice. The disagreement between the retailer and producer is referred to as ______.

vertical conflict