Principles of Marketing Study Guide

What is a primary difference between business and consumer buyers?

Business buyers generally place larger orders than consumer buyers

The director of marketing for Duck Brand tells the rest of the management team, "When it comes to our duct tape unit, our strategy will be to use funds generated here to support our venture in the industrial bonding market." This strategy indicates that the duct tape unit falls into which one of the following classifications?

Cash cow

Which of the following describes a company hiring a foreign firm to produce a designated volume of its product to specification?

Contract manufacturing

Which category of income are marketers most interested in?

Disposable income

A firm can survive in the long run only if its products are sold below cost.

False

Why would a company use the undifferentiated strategy?

The needs of individual consumers in the target market for a specific product are similar, so the organization can satisfy most customers with a single marketing mix

Which of the following is NOT a characteristic of a consumer market?

Their purchasing decisions are always made by only one individual

Which of the following is NOT a physical surroundings factor influencing buying decisions?

Time

A customer must have a particular brand and will accept no substitutes. This is termed brand

insistence

A marketing manager for a small laptop manufacturer is analyzing the potential effects of political, legal, sociocultural, and economic forces on the firm's operations. The marketing manager is examining the ____ that influence(s) the firm's strategy.

marketing environment

Johnson Appliances owner Justin Johnson feels that his organization has access to a great deal of information generated both inside and outside the firm, but much of this information is presently going to waste. Apparently, Justin needs to develop a

marketing information system

Marketers that attempt to influence and change the various environmental forces have a(n) ____ response to these forces.

proactive

The five major stages of the consumer buying decision process, in order, are

problem recognition, information search, evaluation of alternatives, purchase, and postpurchase evaluation.

Making modifications to packaging or brand names involves the ____ component of the marketing mix.

product

If Glad expresses concern that its plastic bags and storage products are having too great an impact on the pollution of groundwater under landfills, this concern is directly related to the firm's

social responsibility.

Marketers of computer software, music, and books are particularly affected by cultural differences in

standards regarding intellectual property

Successful business organizations should take actions to convert internal weaknesses into ____ and external threats into ____.

strengths and opportunities

The step of the personal selling process in which a salesperson contacts a potential customer is called

the approach

Franchising offers all the following benefits for franchisors except

the franchisee's revenue stream is fairly consistent because franchisors pay fixed fees and royalties

Price is a key element in the marketing mix because it relates most directly to

the generation of total revenue

The target audience for an advertising campaign is the

people toward whom the advertisements are directed

____ uses the internet, mobile, and interactive channels to develop communication and exchanges with customers.

Digital marketing

Which of the following is true about characteristics of business buying?

Discussions and negotiations associated with business purchases can require considerable marketing time and selling effort

When buying materials to use in manufacturing mattresses, the purchasing agent for Casper Sleep considers a variety of factors. Which one of the following is least likely to concern this buyer?

Does the supplier consistently deliver on time?

After doing considerable shopping, Pax has just decided what brand and type of athletic shoes to buy and where he's going to buy them. In what stage of the consumer buying decision process is Pax?

Evaluation of alternatives

Although difficult to measure, brand loyalty represents the value of a brand to an organization.

False

An individual's after-tax income is called his or her discretionary income, which is used for spending and/or saving.

False

Changes in cultural values have little effect on people's needs for products.

False

Exploratory research is concerned with identifying the characteristics of markets or categorizing market activities.

False

Marketing consists primarily of selling and advertising

False

Public relations efforts are directed primarily toward external stakeholders such as customers and the media.

False

Public relations is rarely used by nonprofit organizations to achieve their goals.

False

Segmentation variables are characteristics of individuals, groups, or organizations in a total market.

False

The brands used for co-branding cannot be owned by the same company.

False

The manager of Central Market is interested in asking consumers what they think about the store's new layout and expanded produce selection. If the manager would like to obtain a high response rate and have the study conducted as quickly as possible, which data collection method would you recommend?

Telephone survey

Sellers of farm produce would be likely to use an undifferentiated targeting strategy.

True

The Federal Trade Commission would be the most likely regulatory agency to curb false advertising.​

True

The concentrated targeting strategy is one in which an organization directs its marketing efforts toward a single market segment through one marketing mix.

True

The four requirements of a market are that the individuals in the market must have a need for the product and the ability, willingness, and authority to buy it.

True

The strength of one's buying power depends partially on the state of the economy.

True

Which of the following uses tools and methods—including software to track, store, and analyze data—to measure and interpret the effectiveness of a firm's marketing activities?

Marketing analytics

Recognition and recall tests are posttest methods based on

Memory

Nike manufactures athletic shoes, shorts, shirts, and a variety of other athletic products. These products make up Nike's product

Mix

One of the most important benefits of e-marketing is the ability of marketers and

One of the most important benefits of e-marketing is the ability of marketers and

United Airlines introduced a new "basic economy" seat category to better compete with discount airlines like Southwest and Spirit. Which of the following aspects of the marketing mix is United likely altering?

Price

A potato chip company advertises that its newly launched product can lower cholesterol, although the company cannot provide evidence to substantiate this claim. This situation involves an ethical issue related to which element of the marketing mix?

Promotion

During which stage of the consumer buying decision process does a consumer decide from which seller he or she will buy the product?

Purchase

Quality Tools, Inc., purchases air hammers, wrenches, and other hardware items from a variety of manufacturers and sells them to hardware stores at a price that includes a profit for Quality Tools, Inc. The company would be part of what type of business market?

Reseller

Which of the following consumer decision-making processes will probably be used in purchasing toothpaste?

Routinized response behavior

A market is a group of people who, as individuals, have needs for products in a product class and have the ability, willingness, and authority to purchase such products.

True

A target market is a specific group of customers on whom an organization focuses its marketing efforts.

True

Brand recognition exists when a customer is aware that the brand exists and views it as an alternative to purchase if the preferred brand is unavailable or if the other available brands are unfamiliar to the customer.

True

Customer advisory boards are small groups of actual customers who serve as sounding boards for new product ideas and offer insights into their feelings and attitudes toward a firm's products, promotion, pricing, and other elements of marketing strategy.

True

Environmental analysis helps managers identify potential threats and opportunities linked to environmental changes.

True

Factors affecting pricing decisions can include demand, distribution, and the way in which the product is promoted.

True

Many laws that directly influence marketing activities were enacted either to preserve a competitive atmosphere or to protect consumers.

True

When a firm's management is making the final selection of specific target markets to enter, it should consider whether the organization has the financial resources, managerial skills, expertise, and facilities needed to effectively compete in the selected segments.

True

Why should a benchmark statement be included in advertising objectives?

Without a reference point, it is difficult to determine to what degree objectives have been accomplished

If a marketing researcher is interested in observing group interaction during an informal, unstructured, and open-ended data collection process, he or she should use

a focus-group interview

A business partnership between a domestic firm and a foreign firm is known as

a joint venture

The Foreign Corrupt Practices Act of 1977 makes it illegal for U.S. firms to

attempt to make large payments or bribes to influence policy decisions of foreign governments

The effectiveness of an advertising campaign can be measured

before, during, and after the campaign through the use of pretests, inquiries, and posttests

Because most ethical choices pertaining to marketing decisions are jointly made, an organization must ensure its ____ reflects the organization's values, beliefs, and norms.

organizational or corporate culture

The ____ stage of the personal selling process is when the salesperson asks the prospect to buy the product.

closing

If Woody's Inc., a producer of home siding, decking, and other wood products, focused its marketing efforts to home construction companies only, it would be using a(n) ____ strategy. If it sold the same products to both construction companies and DIY retailers such as Home Depot, it would be using a(n) ____ strategy

concentrated and differentiated

A junior marketing executive at HealthyStart Cereals suggests increasing the package size and price of its best-selling brand without increasing the amount of cereal inside the box. Her superior warns that this might be a bad idea because HealthyStart's long-term survival, like most companies, depends on

creating and maintaining satisfying exchange relationships

Research that is conducted to clarify the characteristics of certain phenomena to solve a particular problem is called ____ research.

descriptive

Consumers buying products online have dramatically affected the ____ variable of the marketing mix.

distribution

The Ethan Allen furniture company collects information about a wide variety of competitive, economic, political, legal and regulatory, technological, and sociocultural forces that affect its marketing activities. This process is called

environmental scanning.

Suppose that marketers at Unilever are trying to determine whether the use of free samples of Axe body spray was the reason for a sales increase in a particular store. The type of research conducted to answer this question is

experimental

The extent of Jaimie's participation in global business is selling the batteries it manufactures to companies in Spain. In this case, Jaimie is a(n

exporter

The forces that other people exert on one's buying behavior are called social influences. These come from reference groups and opinion leaders, digital influences, social classes, culture and subcultures, roles, and

family

Burke Marketing Research is concerned about using surveys to conduct a marketing research project because

fewer people are willing to participate.

Marketers generally view ____ as the minimum price a product can be sold for.

fixed costs

A special form of licensing in which one company grants another company the right to market its product and name in accordance with its standards in exchange for a financial commitment is called

franchising

As Mateo reads the copy for South Beach Hotel's upcoming magazine ad in Miami Style, he worries that no one will spend the time to read all the details of the facilities his resort has to offer. Wanting to have the greatest impact, Mateo focuses his creative efforts on the

headline

Organizations should define themselves not according to the products they produce but according to

how they satisfy customers.

If Kyrgyzstan levied a duty on all goods purchased from the United States and other countries outside its borders that were brought into Kyrgyzstan, its businesses and citizens would be paying a(n)

import tariff

Madison goes to Kmart to purchase school supplies for her two children. As she is approaching the checkout counter, she sees a vase she just has to have and buys it immediately. Madison's purchase of the vase is an example of

impulse buying

A target market

is a specific group of customers on whom an organization focuses its marketing efforts.

A major disadvantage of personal selling is that it

is very expensive per contact

If Caterpillar wished to reach the market in Malaysia but was leery of a direct investment in the country, it might provide a Malaysian operation with the knowledge to produce and market its products in exchange for a commission. This type of arrangement is called

licensing

During the introduction stage of a successful product, profits are usually

negative and increasing

Favorable conditions in the marketplace environment that could produce business rewards for the organization if acted upon properly are called

opportunities.

McDonald's supports and funds Ronald McDonald houses for the families of terminally-ill children to stay in to be near their loved ones. McDonald's action demonstrates the fulfillment of ____ responsibility.

philanthropic

Business markets are typically divided into four categories. These categories are

producer, reseller, government, and institutional

If India, in an attempt to bolster the sales of its own auto manufacturers, decided to limit the number of automobiles that could be brought in from other countries, India would be using a(n)

quota

The percentage of consumers in the target audience actually exposed to a particular advertisement in a stated period of time is the definition of

reach

Wegmans Food Markets is revising its marketing plan for the upcoming quarter. Wegmans typically focuses on its wide variety of products and its high-quality customer service, having very few weekly "sales." However, during the upcoming quarter, Wegmans plans to focus on price and value, and promote weekly "values" instead. Wegmans is most likely operating in which stage of the business cycle?

recession.

Marketing ethics

refers to principles and standards that define acceptable conduct in marketing.

The three purposes for which individuals or groups can use products in order for it to be considered a business market are

resale, use in daily operations, and direct use in producing other products

Individuals and business organizations that buy finished goods and resell them to make a profit without changing the physical characteristics of the product are classified as ____ markets.

reseller

Thomas Holden runs a successful wholesale business that sells equipment to restaurants throughout the Southwest. He is considering purchasing his own fleet of trucks to deliver the equipment instead of relying on a shipper as he is currently doing. This most closely represents

the best way to distribute his products.

The cost per thousand (CPM) indicator shows

the cost to expose 1,000 people to a one-page magazine advertisement

Coca-Cola has in recent years developed or acquired new non-cola products to appeal to changing consumer preferences for less sugar in their products. The most likely factor in this change is changes in

the sociocultural forces of the marketing environment.

Marketing research is best defined as

the systematic design, collection, interpretation, and reporting of information to help marketers solve specific marketing problems or take advantage of market opportunities.

During the personal selling process, a salesperson, if possible, should handle objections when

they arise

In today's marketing environment, competitors can take on many forms. For example, a Starbucks latte can be seen as a competitor to an issue of The New York Times. In this circumstance, these two products are described as ____ competitors.

total budget

All of the following are steps in the marketing research process except

understanding your customer

A trading company acts like a ______, taking on much of the responsibility of finding markets while facilitating all marketing aspects of a transaction.

wholesaler