Marketing, Final Exam
Which of the following is NOT part of the 5 steps of consumer buying decision process?
Market segmentation volume potential
An organization's business goals should be derived from its
Mission statement
Which one of the 4 P's of the marketing mix is usually seen as a "short term" method of driving sales because it can be easily copied and lowers profits?
Price
In order to determine total sales potential for a market - the maximum sales that could occur if all potential customers in that market were to buy a product - can be calculated by:
Total population x % of population that use the product or service x (price of product x # of times they use the product)
Which of the following statements about price elasticity is false?
When price is raised on a product that has an inelastic demand, then total revenue will decrease.
Which of the following is NOT part of the 3 main dimensions of determining pricing?
discounting
Total industry sales for athletic footwear was $104 billion dollars in 2017. Nike's sales for 2017 were $48 billion. What was Nike's market share of the athletic footwear industry in 2017?
48%
The state of Utah has approximately 3.2 million people. Of that total, 17% like to downhill ski. What would the market density for downhill skiers be for the state of Utah?
544,000
Apple's annual sales of smartphones was $36,000,000,000 in 2018. Total industry sales for smartphones was $487,000,000,000. What would Apple's market share be?
7.4%
A pair of Nike Air Jordan basketball shoes are priced at $190. The cost of the shoes is approximately $28.50. What is the gross margin for the shoes?
85%
Credit Suisse paid $2.6 million in fines and pleaded guilty to helping American customers evade their taxes. Which dimension of social responsibility applies to this example?
legal
Claire is beginning to wonder if she has made the right decision about purchasing a new HP laptop after she sees a friend with a new Dell. Claire's doubt whether she made the right decision occurs during the ___________ of the buying decision process.
postpurchase evaluation phase
Marketers must insure that pricing objectives they set are consistent with
the financial objectives et for the company and the marketing department
What is the best data a marketer can have?
Combination of quantitative and qualitative
All of the following conditions must be in place if accurate market segmentation is to happen EXCEPT
Competitors must be few and small in size
Jason is going to buy a new car. He has narrowed his choices down to Nissan, Ford, Chevy and Honda. These brands would represent
Consideration set
Dasani (Coca Cola bottled water brand) can be described as having a dominant share of the market but low prospects for growth. It is at a point where it generates more cash than is required to maintain market share. Based upon the BCG Matrix, how would you classify DASANI? Choose from the following options.
Cow
Stars have a dominant share of the market but low prospects for growth, and they typically generate more cash than is required to maintain market share
False
The more elastic the demand, the more beneficial it is for the seller to raise the price
False
Customers often prioritize the size of the data plan (amount of G's) (objective criteria) and their belief in the quality of the provider (subjective criteria) as the two most important criteria when selecting a data plan provider for their family. Size and perceived quality would be examples of evaluative criteria.
True
Environmental scanning is the process of collecting information about external forces in the marketing environment that may have an impact the effectiveness of marketing strategies and tactics. The scanning process can includeobservation,secondary sources - such as business, trade, government, and general-interest publications and marketing research.
True
Graco's - a manufacturer of baby furniture - failed to inform customers that several of its products contained a lead coating - a substance linked to causing cancer. This would be considered a "failure" to market ethically by Grace. True or False.
True
Market density refers to the total potential customers in a specific market.
True
Marketing ethics would be defined as "Principles and standards that define acceptable marketing conduct as determined by various stakeholders."
True
Promotion can help sustain interest in established products that have long been available.
True
Small firms can compete in industries dominated by larger players by using a market segmentation strategy.
True
Product development is a strategy of increasing sales by improving present products or developing new products for current markets.
True
The consumer buying decision process involves _______ stages. The first stage is ____________, and the last stage is _____________.
five; problem recognition; postpurchase evaluation
Cognitive dissonance is most likely to occur during which part of the decision making process?
Postpurchase evaluation
A regular size cup of coffee at Starbucks is $2.75. The cost of the coffee (cost of goods sold/COGS) is 33%. What would the gross profit be for a cup of regular coffee?
$1.84
Honda has financial objectives of generating a 25% gross margin on every car that it sells. If the cost to make the 2018 Honda Civic is $12,500, what should Honda price it at to achieve their goal of a 25% margin?
$16,700
Nike is thinking of introducing a broomball shoe in Minnesota for the broomball season. The total population of MN is 5.5 million people, roughly 15% of Minnesotans play broomball. Nike estimates that over the course of their lifetime, MN who play broomball would purchase 3 sets of broomball shoes. Nike plans to price the shoe at $78. What would the total market potential be?
$193,069,422
Jenny's Carmel Popcorn Company would like to introduce their line of sweet popcorn into grocery stores in Minnesota. What would be the sales potential given the following information? - MN population: 5.5 million - % of population that consumes sweet or flavored popcorn = 23% - Avg. price of a bag of popcorn: $4.25 - Avg customer buys sweet popcorn 6 times per year - Competitor/global impact of 70%
$22,580,250
The average price for a Dell laptop computer is $750. The gross margin is 70%. What is the cost (cost of goods sold) for the laptop?
$225
If Ben & Jerry's Ice Cream has developed a new flavor of ice cream - Double Fudge Marketeer Delight - with a cost of goods sold of $2.33 per half gallon and has a company goal of achieving a gross margin of 32% - what should they price the new product at?
$3.42
What would the best sales estimates - from the answers listed below - for the following scenario? Tide laundry detergent is developing a "Pumpkin Spice" fragrance that it will potentially introduce in the Fall to entice users to wash more frequently. Senior management requested that marketing develop a sales estimate of what this product could generate in terms of sales. Here are the variables they considered when developing their estimate: 1. Total population of detergent users: 34,000,000 2. Percent of total detergent users that like fragrances: 43% 3. Several competitors already offer a "Fall Fragrance." As a result, market research indicates that the competitor products would negatively impact the sales potential of Tide's new product by 30%. (In other words, Tide total sales could only realize 70% (1-.30) of its true potential. 4. The price of the new product will be $10.49 5. Purchase frequency for the target segment is estimated to be 4.5 times per year.
$483,095,970
The Red Cow (Professor Donaldson's favorite new burger place) will be introducing a new burger next month - known as the POM Burger - Principles of Marketing Burger - which features 1 lb patty of grass fed beef, pepper jack cheese, 3 bacon strips, sautéed mushrooms, banana peppers, lettuce, tomato and crispy onion fries. The cost of all the ingredients is $2.27. If the Red Cow wants to achieve a gross margin of 65% - what should they price the POM Burger at? Choose one of the following:
$6.48
What would the global market potential for a product be based upon the following information? - Total population: 1,250,000 - % of population that uses product/service: 35% - Avg. retail price of product/servcie: $25 - Customers who purchase use product/service purchase it 8 times per year. - Global/Competitive factor: 85%
$74,375,000
A product that demonstrates value usually provides which of the following enhancements/benefits?
A meaningful point of differentiation relative to the competition
Which of the following best defines what a marketer must consider when developing a sales estimate for a market?
All of these (potential competitor in that market, total population of the market, purchase frequency)
Which of the following criteria is frequently used to determine a target market?
All of these choice (age, lifestyle, geographic location)
Qualitative data is
Data that is descriptive about how the customer perceives the product/service but is not numerical
Which of the following is NOT part of the 5 step Market Research Process
Determining market volume potential
Marketing efforts do not involve the design and development of products.
False
_____________ (choose below) refers to minimizing the resources an organization uses to achieve a specific level of desired customer relationships.
Efficiency
Shelly wants to hire her cousin's consulting company to help her organization, but she wonders if this might violate the company's conflict of interest policy. Which dimension of social responsibility applies to this example?
Ethical
Joe is considering buying a new car. He has developed a list of most important considerations including cost of the car, color, horsepower and cars ability to handle snowy roads. Joe has developed his own opinions about various car brands and is now spending considerable amount of time reviewing reports on various manufacturers through such websites as Car & Driver and Consumer Reports. Which of the following would the review of Car & Driver and Consumer Reports be considered?
External research
(True of False) Bi-Pro - the Eden Prairie based company that manufactures and distributes a protein supplement, is thinking about launching their product in Germany. The total population of Germany is 82.6 million people. An estimated 12% of the German population currently uses/purchases protein supplements of some sort. Bio-Pro calculates that the market density for their product for the country of Germany would be 68.5 million potential customers.
False
(True of False) Purchase frequency - the number of times that a consumer buys a product - is not necessary in calculating total sales potential.
False
(True or False) The opening new restaurants in Japan, the marketing team conducted research that indicated that the preferred size of soda serving sizes in Japan were 25% smaller than in the U.S. This would be an example of an "ethical" global environment factor that McDonald's had to take into consideration when determining what size beverages to introduce in Japan.
False
(True or False) When determining sales potential of an international market, the global environmental factor is always negative.
False
A strong code of conduct that is carefully thought out and detailed should NEVER have to be reviewed or changed at all because it takes into account all situations that a company will ever encounter now and in the future.
False
Failure to inform customers about existing conditions or changes in product quality is NOT an example of unethical marketing.
False
If the demand for haircuts does not vary based upon whether a salon charges $15 per cut or $10 per cut, the demand for haircuts would be categorized as elastic.
False
In general, when marketers focus on customers chosen for their lifetime value, they earn lower profits in future periods than when they focus on customers selected for other reasons.
False
Liz is thinking of buying a new smartphone. There are seemingly hundreds of options to choose from - she is overwhelmed by all the choices and options. Her professor in Principles of Marketing suggests that she develops a prioritized list of objective and subjective product charateristics that are most important to her related to her next smartphone. These variables would be an example of Liz "consideration set."
False
Which of the following would NOT be an example of misleading or unethical marketing?
Feature a discontinued model at a discounted price
Which of the following is NOT a stakeholder group that marketers must take into consideration when considering ethics?
International advertising agencies
Why is market density important for marketers to know?
It determines the total potential customers for a product in a given market
Cheerios comes in two different "formulas" - regular Cheerios and Gluten-Free Cheerios. As a result, it has two distinct versions of packaging and two distinct advertising campaigns to support the specific formulas and benefits of each product. This would be an example of what kind of targeting strategy?
Market segmentation
Nike's marketing team develops products and marketing support campaigns by dividing up customers into groups based upon the sports they play. This would be an example of
Market segmentation
Apple continues to grow its business by developing new products (Apple Watch) and optimizing the performance of existing ones (iPhone.) Which of the following best defines Apple's growth strategy? Select one of the following:
Product development
Which of the following is most likely to have an inelastic demand curve?
Nonelective surgery
Which of the following best defines quantitative data?
Provides important information about how a customer perceives a product/service which is communicated through numbers
During which stage of the consumer buying decision process does a consumer decide from which seller he or she will buy the product?
Purchase
From the Boston Consulting Group (BCG) growth matrix - a ____________ has a small share of a growing market and generally require a large amount of cash to build market share. (choose answer from below.)
Question mark
When developing questions for an upcoming research study, which of the following IS NOT considered a best practice for insuring the optimal capture of usable data from customers?
Questions that will generate ONLY a numeric answer
Pepsi is trying to identify new beverage categories that would attract Gen Z customers. As a first step, their marketing team looks at research and data that was already conducted about Gen Z. beverage preferences by various outside companies. This would be an example of what kind of data that the marketing team reviewed?
Secondary
Which of the following is NOT a key criteria for determining whether a group of individuals should be considered a target market?
The competitors that offer they same product or service are not based in the United State.
Which of the following is a requirement for setting pricing objectives?
The objectives/goals of what the company is trying to achieve through pricing should be clearly stated.
Market density is
The potential number of customers within a unit of land area
American Airlines' frequent-flyer program awards AAdvantage Miles to passengers when they fly with its airline. When passengers accumulate a certain amount of miles, they can redeem them to get discounts on flights. Why has American Airlines adopted this frequent-flyer initiative?
To increase customer loyalty and build a positive relationship
(True of false) 5 Guys Hamburger is thinking about opening restaurants in Austria. It has calculated the total market potential of hamburger customers in this country. Hamburgeken, however, is a family owned chain of hamburger restaurants based in Austria and is extremely popular due to its special sauce, hand cut fries and long standing relationships with many communities throughout the country. These factors related to Hamburgeken would be examples of "competitor/global impact" - that can negatively impact the sales potential of a new product or service in a given market.
True
(True or False) A consumer may try to reduce cognitive dissonance by trying to return the product they purchased
True
(True or False) Marketing research is the systematic design, collection, interpretation and reporting of information designed to help marketers solve specific marketing problems or take advantage of marketing opportunities.
True
(True or False) Roy enjoys cycling. He sets out on a hundred mile ride on a warm summer day. He gathers all of his gear before setting out - helmet, gloves, sunglasses, water bottle filled with water and an "Extend Energy" bar - which is high in protein, great in taste and easy to digest when on the move - guaranteed to "boost your energy." 50 miles into the ride, Roy takes a break for some water and consumes two of the Extend Energy Bars. Rather than feeling a boost of energy, Roy actually feels weaker and a bit nauseous. At the end of the ride, Roy feels he made a bad purchase with Extend Energy Bars and wishes he had not bought an entire box of them. Roy is showing signs of cognitive dissonance.
True
(True or False) Segmentation variables are characteristics of individuals, groups or organizations used to divide a market into segments.
True
(True/False) Market research can consist of both qualitative and quantitative data.
True
A core competency is something a firm does extremely well, sometimes so well that it gives the company an advantage over its competition.
True
An undifferentiated targeting strategy is a strategy in which an organization designs a single marketing mix and directs it at the entire market for a particular product
True
At the most basic level, profits can be obtained through relationships by acquiring new customers, enhancing the profitability of existing customers, and extending the duration of customer relationships.
True
Cognitive dissonance is most likely to occur with products that are expensive and complex and require significant consumer research and evaluation.
True
Customer relationship management is the use of information about customers to create marketing strategies that develop and sustain desirable customer relationships.
True
High Gliding Air Academy is developing its marketing mix for the coming year. Its managers know that they must first select ____ which may be the most important decision they make in the planning process.
a target market
Max recently purchased a Ford F150 truck and has owned it for about a week. Earlier in the day, he received a call from Dane, the sales representative who sold him the truck. Dane called to check to see whether Max had any questions or problems with the truck and if he had learned how to navigate all the bells and whistles. Dane also reminded Max about how Ford is highly regarded as one of the best automobile brands and that the Ford truck is the #1 truck brand in the United States. What phenomenon is Dane trying to prevent by contacting her customer?
cognitive dissonance
When shopping for detergent, Josh looks at Tide, Fresh Start, Surf, and All and chooses the one that is on sale. These four brands make up his ____ set.
consideration
A recession always has a negative impact on the level of exotic vacation travel consumers partake in. A recession would be an example of which of the following envrionmental variables?
economic
Which of the following would be an example of a competitor/global factor that a marketer would have to take into consideration when determining sales potential of a given international market?
economic conditions
Of the 4 growth strategies we studies in Chapter 2 - which defines the Market Penetration Strategy?
increasing sales in current markets with current products
Tiffany is a purchasing manager of computer and software equipment for her company, which employs about 350 individuals. She subscribes to PC Magazineand several other trade publications that review computer hardware and software. In addition, Tiffany is an active user of online forums and often reads reviews that other purchasing managers post about different computer models. Tiffany spends about 1-2 hours each week reviewing information through these sources before making purchasing decisions. What stage of the consumer decision process is Tiffany most likely in?
information search
