MARK Chapter 14 and Short Answers

How do integrated marketing communications (IMC) build brand identity?

IMC builds brand identity and strong customer relationships by tying together all of the company's messages and images.

Explain the concept of integrated marketing communications (IMC).

IMC calls for recognizing all touchpoints where the customer may encounter the company and its brands. While implementing IMC, the company's goal should be to deliver a consistent and positive message at each contact. Integrated marketing communications ties together all of the company's messages and images. Its television and print ads have the same message, look, and feel as its e-mail and personal selling communications. And its PR materials project the same image as its Web site, online social networks, or mobile marketing efforts.

Which of the following is the first step in developing an effective integrated communications and promotion program? A) designing a message B) identifying the target audience C) determining the communication objectives D) collecting feedback E) choosing the media through which to send a message

identifying the target audience

Delia's is a clothing retailer that targets teenage girls. It runs coordinated promotions for its catalogs, Web site, and retail outlets. It uses the same models in its catalog, print ads, and Web site. Delia's works to make sure its public relations activities as well as its sales promotions harmonize with its advertising in all aspects. From this information, we can infer that Delia's is using ________. A) buzz marketing B) experiential marketing C) integrated marketing communication D) word-of-mouth marketing E) database marketing

integrated marketing communication

Today several companies are adopting the concept of ________, which carefully combines and coordinates the company's many communication channels to deliver a clear, consistent, and compelling message about the organization and its brands. A) integrated marketing communications B) pull strategy C) vertical diversification D) nonpersonal communication channels E) buzz marketing

integrated marketing communications

Which of the following statements is true regarding today's marketing communications? A) More marketers are shifting away from narrowly defined micromarkets and moving toward mass marketing. B) More customers have started relying on marketer-supplied information rather than finding out information on their own. C) Network television, magazines, newspapers, and other traditional mass media continue to increase their dominance. D) Focused marketing programs which are designed to build closer relationships with customers in more narrowly defined micromarkets are no longer used by marketers. E) Today's consumers are better informed about products and services.

Today's consumers are better informed about products and services.

Marketers can choose from two basic promotion mix strategies—push promotion or pull promotion. Compare these two strategies.

Using the pull strategy, the producer directs its marketing activities toward final consumers to induce them to buy the product; if the pull strategy is effective, consumers will then demand the product from channel members, who will in turn demand it from producers. Using a push strategy, the producer focuses instead on the channel members, persuading them to carry the product and promote it to final consumers.

Which of the following statements is true about personal communication channels? A) A magazine advertisement exemplifies the use of a personal communication channel. B) All personal communication channels are directly controlled by a company. C) Personal communication channels do not allow sending and receiving of feedback. D) Word-of-mouth influence uses a personal communication channel. E) A billboard message exemplifies the use of a personal communication channel.

Word-of-mouth influence uses a personal communication channel.

Nonpersonal communication channels include major media, ________, and events. A) sales calls B) buzz marketing C) atmospheres D) word-of-mouth influence E) phone calls

atmospheres

________ involves cultivating opinion leaders and getting them to spread information about a product or a service to others in their communities. A) Sales promotion B) Indirect marketing C) Buzz marketing D) Stealth marketing E) Public relations

Buzz marketing

Why are profound changes in marketing communications creating both exciting and scary times for marketing communicators?

In the past, marketers relied heavily on mass marketing. Today, however, mass markets have fragmented, consumers are better informed, and sweeping changes in technology have changed how companies and consumers communicate with each other. These three factors have led to a new marketing communications model that is specialized to reach smaller customer segments with messages that are more personalized. Mass marketing can no longer be solely relied upon to deliver a marketer's message. Although these changes may frighten marketing communicators, these changes afford tremendous opportunities to reach new customers and strengthen relationships with existing customers.

Which of the following statements is most likely true regarding the competitive-parity method? A) This method involves starting with total revenues, deducting operating expenses and capital outlays, and then devoting some portion of the remaining funds to advertising. B) It is based on the availability of funds rather than on opportunities. C) It wrongly views sales as the cause of promotion rather than as the result. D) In this method, promotion budgets are set to match competitors' outlays. E) This method involves setting the promotion budget at a certain percentage of current or forecasted sales.

In this method, promotion budgets are set to match competitors' outlays.

Which of the following statements is true regarding the old mass-media communications model? A) Mass-media costs are decreasing. B) Mass-media audiences are increasing. C) Many viewers are gaining control of message exposure through DVRs. D) Ad clutter is decreasing. E) Internet ad spending has stagnated and more marketers are shifting toward TV advertising.

Many viewers are gaining control of message exposure through DVRs.

An ad for Maybelline age-minimizing makeup in Ladies' Home Journal magazine featured actress Melina Kanakaredes and offered readers a $1-off coupon when they tried the new makeup. In terms of the communication model, the sender of this message is ________. A) Melina Kanakaredes B) Ladies' Home Journal C) readers who redeem the $1-off coupon D) Maybelline E) the target market to whom Melina Kanakaredes appeals

Maybelline

________ includes sales presentations, trade shows, and incentive programs. A) Direct marketing B) Sales promotion C) Personal selling D) Public relations E) Advertising

Personal selling

Under the ________ Act, sellers cannot favor certain customers through their use of trade promotions. A) Smith-Connally B) Robinson-Patman C) Walsh-Healey D) Wagner E) Sarbanes-Oxley

Robinson-Patman

Which of the following advertising slogans most likely represents a two-sided argument? A) Breakfast of champions B) Good to the last drop C) A diamond is forever D) The ultimate driving machine E) There are some things money can't buy. For everything else, there's MasterCard.

There are some things money can't buy. For everything else, there's MasterCard.

Glasis is a type of paint made specifically for use on cars. An ad in Motor Trend magazine advising consumers to request their auto body shops to use Glasis paint is an example of how a company uses ________. A) word-of-mouth influence B) public relations C) buzz marketing D) a push strategy E) a pull strategy

a pull strategy

The manufacturer of Crest toothpaste provides free samples of its toothpaste to dentists and encourages them to distribute these samples to their patients and to inform the patients about advantages of using Crest. The manufacturer of Crest toothpaste is using ________. A) sales promotion B) direct marketing C) a push strategy D) a pull strategy E) a vertical diversification strategy

a push strategy

Any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor is called ________. A) sales promotion B) advertising C) direct marketing D) personal selling E) public relations

advertising

Which of the following would be classified as bait-and-switch advertising? A) advertising a cheaper brand but making only a more expensive one available to customers B) advertising the advantages of a product by comparing it to its competitors C) providing free samples of a product D) providing discount coupons with a product E) favoring certain customers over others through trade promotions

advertising a cheaper brand but making only a more expensive one available to customers

While using the "________ method" for setting an advertising budget, a company starts with total revenues, deducts operating expenses and capital outlays, and then devotes some portion of the remaining funds to advertising. A) integrated B) moving-average C) competitive-parity D) percentage-of-sales E) affordable

affordable

Moral appeals ________. A) relate to the audience's self-interest by showing that the product will produce the desired benefits B) attempt to stir up either negative or positive emotions that can motivate purchase C) range from love, joy, and humor to fear and guilt D) are directed to an audience's sense of what is "right" and "proper" E) are based on the idea that practical benefits are more important for consumers than emotions

are directed to an audience's sense of what is "right" and "proper"

Among the buyer-readiness stages, the first stage is ________. A) preference B) knowledge C) liking D) awareness E) insistence

awareness

A large retailer advertised a sewing machine for $179. However, when consumers tried to buy the advertised machine, the seller downplayed its features, placed faulty machines on showroom floors, understated the machine's performance, and took other actions in an attempt to convince buyers to buy a more expensive machine. In this case, which of the following types of advertising is used by the retailer? A) cross-selling B) door-in-the-face C) trojan horse D) foot-in-the-door E) bait-and-switch

bait-and-switch

Display media includes ________. A) newspapers B) magazines C) television D) company Web sites E) billboards

billboards

Companies are doing less ________ and more ________ as a result of the explosive developments in communication technologies to better target smaller customer segments. A) personal selling; CSR activities B) public relations activities; CSR activities C) CSR activities; mass marketing D) broadcasting; narrowcasting E) viral marketing; word-of-mouth marketing

broadcasting; narrowcasting

A manufacturer of a variety of technological devices asked its marketing department to develop inexpensive methods of building and maintaining brand awareness and excitement. The marketing department then recruited consumers who were early adopters of technological devices to spread the word about the company's new products. This is an example of ________. A) a reverse marketing activity B) nonpersonal marketing C) buzz marketing D) sales promotion E) direct marketing

buzz marketing

To ________, a marketer would most likely ask target audience members whether they remember the message, how many times they saw it, and what points they remember. A) select a message source B) collect feedback C) select a message channel D) plan a media purchase E) design a marketing appeal

collect feedback

Which of the following methods is used by companies to set their advertising budgets based on the industry average? A) percentage-of-sales method B) affordable method C) competitive-parity method D) objective-and-task method E) regression method

competitive-parity method

Excel Enterprises uses a Web site, online social networks, and print advertisements to promote its products. Since Excel Enterprises practices integrated marketing communications, all these different brand contacts maintain ________ in design and tone. A) variety B) simplicity C) consistency D) creativity E) flexibility

consistency

Which of the following is a sales promotion tool? A) sponsorships B) billboards C) catalogs D) coupons E) posters

coupons

In order to avoid shortsightedness, today marketers are moving toward viewing communications as managing the ________ over time. A) organizational culture B) nonpersonal communication channels C) word-of-mouth influence D) customer relationship E) product life cycle

customer relationship

The FTC has adopted a three-day cooling-off rule to give special protection to ________. A) customers who purchased because of deceptive advertising B) customers who purchased because of bait-and-switch tactics C) customers who were not seeking a product D) resellers who do not receive proportionately equal treatment from manufacturers E) resellers who are not covered by the Robinson-Patnam Act

customers who were not seeking a product

In a communication process, a receiver assigns meaning to the symbols encoded by a company in its advertisements through a process known as ________. A) integrating B) reciprocating C) acknowledging D) decoding E) coordinating

decoding

In the AIDA model, the D stands for ________. A) demand B) desire C) data D) diversion E) decoding

desire

While developing an effective integrated communication, once the target audience has been defined, marketers must ________. A) determine the desired response B) collect feedback C) choose the media through which to send a message D) select the message source E) design a message

determine the desired response

Consumers today receive commercial messages from a broad range of sources. However, consumers ________ the way marketers do. A) don't distinguish between message sources B) never pay attention to sales promotions C) don't care about buzz marketing D) are not able to block out messages E) block out all media messages

don't distinguish between message sources

One of the message structure issues that a marketer must handle is whether to ________. A) draw a conclusion or not B) make a moral appeal or not C) use the pull strategy or push strategy D) diversify vertically or horizontally E) use mass marketing or niche marketing

draw a conclusion or not

An appeal which attempts to stir up either negative or positive sentiments that can motivate purchase is called a(n) ________ appeal. A) rational B) structural C) emotional D) moral E) standard

emotional

Which of the following appeals is based on the idea that consumers often feel before they think? A) emotional appeal B) rational appeal C) structural appeal D) standardized appeal E) integrated appeal

emotional appeal

HP's advertising agency assembles words and illustrations into an advertisement that convey the company's intended brand message. In the context of the communication process, HP is ________. A) messaging B) encoding C) sending D) decoding E) responding

encoding

The decision to use a cleaning genie to communicate the strength and power of "Mr. Clean" cleaning liquid represents the ________ process of the communication model. A) sourcing B) encoding C) acknowledging D) decoding E) messaging

encoding

Marketing communicators must be good at ________ messages that take into account how the target audience ________ them. A) delivering; encodes B) sending; encodes C) encoding; decodes D) retrieving; perceives E) decoding; receives

encoding; decodes

When a customer lets a producer know something about its products or advertising, the customer is providing ________. A) decoding B) noise C) feedback D) encoding E) reverse marketing

feedback

Which of the following terms best represents the communication channel which a company uses to move its advertising messages from sender to receiver? A) decoder B) media C) encoder D) communicator E) feedback loop

media

A(n) ________ is a set of symbols that the sender transmits. A) encoder B) feedback loop C) message D) media E) decoder

message

A charitable trust's appeal which states, "While you are trying to figure out what to get the man who has everything, don't forget the man who has nothing" is an example of a(n) ________ appeal. A) structural B) awareness C) rational D) moral E) standard

moral

A consumer is reading a magazine with an advertisement, but due to a loud sound he is distracted from reading the advertisement and is not able to grasp its key points. In the context of the communication process, this unplanned static or distortion is called ________. A) noise B) encoding C) feedback D) response E) decoding

noise

Which budgeting method entails defining specific promotion goals, determining the necessary tasks, and estimating the costs to determine a promotion budget? A) percentage-of-sales method B) objective-and-task method C) affordable method D) exponential task method E) competitive-parity method

objective-and-task method

Which of the following is the most logical budget-setting method? A) percentage-of-sales method B) affordable method C) competitive-parity method D) objective-and-task method E) exponential smoothing method

objective-and-task method

Which of the following is a specialized and highly targeted media that an advertiser might use to reach smaller customer segments? A) radio B) magazines C) newspapers D) network television E) online social networks

online social networks

Which of the following terms best describes the channels through which two or more people communicate directly with each other, including face to face, mail, e-mail, texting, or an Internet chat? A) unidirectional communication channel B) offline communication channel C) personal communication channel D) nonverbal communication channel E) bidirectional communication channel

personal communication channel

Extel Inc., a home appliance manufacturer, uses sales representatives to sell its products to wholesalers and individual customers. This is an example of ________. A) sales promotion B) personal selling C) public relations D) direct marketing E) advertising

personal selling

In most cases, what is the most expensive promotion tool? A) advertising B) personal selling C) mass media D) public relations E) publicity

personal selling

Which of the following promotional tools is the most effective in building up buyers' preferences, convictions, and actions? A) mass-market advertising B) personal selling C) segmented advertising D) sales promotion E) public relations

personal selling

A newspaper article announced that Connect Wireless, the sixth-largest wireless carrier in a country, was changing its name to M-Mobile and that to begin the makeover process it had replaced spokesperson Robert Garmon with Catherine Naylor. Which of the following elements of a promotion mix is represented in this example? A) sales promotion B) advertising C) public relations D) personal selling E) direct marketing

public relations

Which of the following promotion categories is most likely to use the promotion tools of press releases, sponsorships, events, and Web pages? A) sales promotion B) direct marketing C) advertising D) public relations E) horizontal diversification

public relations

Which of the following promotion tools involves building up a good corporate image and handling unfavorable stories and events? A) sales promotion B) personal selling C) direct marketing D) public relations E) advertising

public relations

Business-to-consumer companies are more likely to emphasize a ________ promotion strategy, while business-to-business companies are more likely to emphasize a ________ promotion strategy. A) pull; push B) push; pull C) pulse; pull D) blitz; pull E) push; blitz

pull; push

John Deere does very little promoting of its lawn mowers and garden tractors to final consumers. Instead, John Deere's sales force works with Lowe's, Home Depot, independent dealers, and other channel members, who in turn sell John Deere products to final consumers. According to this information, which of the following promotion mix strategies is being used by John Deere? A) public relations strategy B) direct marketing strategy C) push strategy D) blitz strategy E) pull strategy

push strategy

Under which promotional mix strategy does the producer direct its marketing activities (primarily advertising and consumer promotion) toward channel members to induce them to carry the product and promote it to final consumers? A) pull strategy B) blitz strategy C) push strategy D) buzz strategy E) pulse strategy

push strategy

A message showing a product's quality, economy, value, or performance is an example of a(n) ________ appeal. A) structural B) rational C) emotional D) moral E) standard

rational

In the communication process, the reaction of the receiver after being exposed to a message is called the ________. A) response B) disturbance C) noise D) code E) distortion

response

Which of the following is one of the four major communication functions? A) coordination B) distribution C) noise D) response E) preference

response

Suppose Amazon.com has offered you free shipping on your next purchase of more than $35. This offer is an example of ________. A) sales promotion B) personal selling C) a public relations strategy D) horizontal diversification E) a pull strategy

sales promotion

The use of short-term incentives to encourage the purchase or sale of a product or service is called ________. A) direct marketing B) sales promotion C) personal selling D) public relations E) publicity

sales promotion

Which of the following promotion categories is most likely to include the use of displays, discounts, coupons, and demonstrations? A) sales promotion B) direct marketing C) horizontal diversification D) public relations E) advertising

sales promotion

Today's consumers do not need to rely on marketer-supplied information about products and services because they can use ________ to seek out a wealth of information. A) push strategies B) direct marketing C) the Internet D) personal selling E) public relations

the Internet

Sam, the owner of a small company, learned that a competitor was planning to spend $150,000 on promotion in the next financial year. As soon as he learned this, Sam called his finance manager and said, "I want to spend $150,000 on promotion next year." In this case, which method of promotional budgeting is used by Sam? A) the objective-and-task method B) the percentage-of-sales method C) the competitive-parity method D) the bottom-up method E) the pull-push method

the competitive-parity method

In the communication process, an actual HP printer/fax machine advertisement would be considered ________. A) encoding B) decoding C) the product D) the message E) the medium

the message

Integrated marketing communications require a company's mass-market advertisements, Web site, e-mail, and personal selling communications to all have ________. A) equal portions of the advertising budget B) independent communications directors C) separate marketing objectives D) the same target audience E) the same message, look, and feel

the same message, look, and feel

Discuss the advantages and disadvantages of advertising.

Advertising can reach masses of geographically dispersed buyers at a low cost per exposure, and it enables the seller to repeat a message many times. Beyond its reach, large-scale advertising says something positive about the seller's size, popularity, and success. Because of advertising''s public nature, consumers tend to view advertised products as more legitimate. Advertising is also very expressive; it allows the company to dramatize its products through the artful use of visuals, print, sound, and color. Advertising also has some shortcomings. Although it reaches many people quickly, advertising is impersonal and lacks the direct persuasiveness of company salespeople. For the most part, advertising can carry on only a one-way communication with an audience, and the audience does not feel that it has to pay attention or respond. In addition, advertising can be very costly.

A company's marketing communications mix—also called its promotion mix—blends five different components. List and define these components.

Advertising is any paid-for or nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor. Sales promotion includes short-term incentives to encourage the purchase or sale of a product or service. Public relations includes building good relations with the company's various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, or events. Personal selling includes a personal presentation by the firm's sales force for the purpose of making sales and building customer relationships. Direct marketing includes direct connections with carefully targeted individual consumers to obtain an immediate response and cultivate lasting customer relationships.

Discuss direct marketing.

Although there are many forms of direct marketing—direct mail and catalogs, online marketing, mobile marketing, and others—they all share four distinctive characteristics. Direct marketing is less public: The message is normally directed to a specific person. Direct marketing is immediate and customized: Messages can be prepared very quickly and can be tailored to appeal to specific consumers. Finally, direct marketing is interactive: It allows a dialogue between the marketing team and the consumer, and messages can be altered depending on the consumer's response. Thus, direct marketing is well suited to highly targeted marketing efforts and building one-to-one customer relationships.

Why should a company be concerned about integrating communications from different sources within the company?

Customers won't separate conflicting or varying messages from different sources within a company, so failing to integrate communications could lead to blurred consumer brand perceptions.

________ refers to the process of putting thought into symbolic form. A) Sending B) Encoding C) Decoding D) Receiving E) Feedback

Encoding

________ are staged occurrences that communicate messages to target audiences. A) Focus groups B) Encoders C) Atmospheres D) Events E) Decoders

Events

What role does message format play in print advertisements?

In a print ad, for example, the headline, copy, illustrations, and color are critical. To attract attention, the advertiser may use novelty, contrasts, or eye-catching headlines.

Outline the steps in developing effective marketing communications.

In preparing marketing communications, the marketer's first task is to identify the target audience and its characteristics. Next, the marketer has to determine the communication objectives and define the response sought, whether it is awareness, knowledge, liking, preference, conviction, or purchase. Then a message should be constructed with an effective content and structure. Media must be selected, both for personal and nonpersonal communication. The marketer should find highly credible sources to deliver messages. Finally, the communicator must collect feedback by watching how much of the market becomes aware, tries the product, and is satisfied in the process.

Which of the following statements is true regarding the affordable method for setting a promotion budget? A) It is mostly used by large businesses. B) It completely ignores the effects of promotion on sales. C) It tends to place promotion first among spending priorities. D) It leads to a certain annual promotion budget. E) It almost always results in overspending.

It completely ignores the effects of promotion on sales.

Which of the following statements is most likely true regarding the objective-and-task method of budget-setting? A) It forces management to spell out its assumptions about the relationship between the money spent and promotion results. B) It is the simplest and least time consuming method to use. C) It is the least logical budget-setting method. D) It involves setting the promotion budget to match competitors' outlays. E) It wrongly views sales as the cause of promotion rather than as the result.

It forces management to spell out its assumptions about the relationship between the money spent and promotion results.

Which of the following is most likely a shortcoming of advertising? A) It is the most expensive promotion tool. B) It cannot reach masses of geographically dispersed buyers. C) It is impersonal and lacks the direct persuasiveness of company salespeople. D) It cannot trigger quick sales. E) It cannot be used to build up a long-term image for a product.

It is impersonal and lacks the direct persuasiveness of company salespeople.

An ad for Maybelline age-minimizing makeup in Ladies' Home Journal magazine featured actress Melina Kanakaredes and offered readers a $1-off coupon when they tried the new makeup. In terms of the communication model, the medium of this ad is ________. A) Melina Kanakaredes B) Ladies' Home Journal C) readers who redeem the $1-off coupon D) Maybelline E) the target market to whom Melina Kanakaredes appeals

Ladies' Home Journal

In the communication process, what is noise and what is its significance?

Noise is the unplanned static or distortion during the communication process, which results in the receiver getting a different message than the one the sender sent. Due to the noise, the consumer can get distracted and might miss the key point.

Why do marketers value opinion leaders?

Opinion leaders are people whose opinions are sought by others. Marketers rely on opinion leaders to positively influence the spread of product or service acceptance through a market.

What is personal selling? What are the advantages and disadvantages of a firm using personal selling to promote a product or service?

Personal selling is the most effective tool at certain stages of the buying process, particularly in building up buyers' preferences, convictions, and actions. It involves personal interaction between two or more people, so each person can observe the other's needs and characteristics and make quick adjustments. Personal selling also allows all kinds of customer relationships to spring up, ranging from matter-of-fact selling relationships to personal friendships. An effective salesperson keeps the customer's interests at heart to build a long-term relationship by solving a customer's problems. Finally, with personal selling, the buyer usually feels a greater need to listen and respond, even if the response is a polite "No thank-you." These unique qualities come at a cost, however. A sales force requires a longer-term commitment than does advertising—although advertising can be turned up or down, the size of a sales force is harder to change. Personal selling is also the company's most expensive promotion tool, costing companies on average $350 or more per sales call, depending on the industry

________ is very believable because news stories, features, sponsorships, and events seem more real and believable to readers than ads do. A) Differentiated marketing B) Public relations C) Direct marketing D) Sales promotion E) Personal selling

Public relations

Describe the significance of public relations as a promotion tool.

Public relations is very believable—news stories, features, sponsorships, and events seem more real and believable to readers than ads do. PR can also reach many prospects who avoid salespeople and advertisements—the message gets to buyers as "news" rather than as a sales-directed communication. And, as with advertising, public relations can dramatize a company or product. Marketers tend to underuse public relations or use it as an afterthought. Yet a well-thought-out public relations campaign used with other promotion mix elements can be very effective and economical.

Describe the three types of appeals marketers use.

Rational appeals relate to the consumer's self-interest; emotional appeals attempt to stir up either positive or negative emotions; moral appeals are directed to the consumer's sense of what is "right" and "proper."

________ consists of strong short-term incentives that invite and reward quick responses from customers. A) Public relations B) Personal selling C) Advertising D) Sales promotion E) Direct marketing

Sales promotion

Discuss sales promotion.

Sales promotion includes a wide assortment of tools—coupons, contests, discounts, premiums, and others—all of which have many unique qualities. They attract consumer attention, offer strong incentives to purchase, and can be used to dramatize product offers and boost sagging sales. Sales promotions invite and reward quick response. Whereas advertising says, "Buy our product," sales promotion says, "Buy it now." Sales promotion effects are often short lived, however, and often are not as effective as advertising or personal selling in building long-run brand preference and customer relationships.

When is it advisable to predominantly use sales promotions in a promotion mix?

Sales promotions are used to invite and reward quick response. Sales promotions are short-lived; therefore, sales promotions are used when the marketer intends to make a quick, dramatic impact on an intended audience with the use of coupons, samples, contest, etc.

Discuss the affordable method of setting the total budget for advertising.

Some companies use the affordable method: They set the promotion budget at the level they think the company can afford. Small businesses often use this method, reasoning that the company cannot spend more on advertising than it has. They start with total revenues, deduct operating expenses and capital outlays, and then devote some portion of the remaining funds to advertising. Unfortunately, this method of setting budgets completely ignores the effects of promotion on sales. It tends to place promotion last among spending priorities, even in situations in which advertising is critical to the firm's success. It leads to an uncertain annual promotion budget, which makes long-range market planning difficult. Although the affordable method can result in overspending on advertising, it more often results in underspending.

What are the four major communication functions?

The four major communication functions are encoding, decoding, response, and feedback. Encoding is the process of putting thought into symbolic form. Decoding is the process by which the receiver assigns meaning to the symbols encoded by the sender. In addition, response refers to the reactions of the receiver after being exposed to the message. Feedback is the part of the receiver's response communicated back to the sender.

Why is the consumer's field of experience important to a marketer?

The marketing communicator must understand the consumer's field of experience in order to create promotional messages that will be decoded as the sender intends them to be understood.

Explain how the message source affects consumers' perceptions of the message.

The message source will affect how the consumer perceives the message. For example, highly credible sources—such as certain newspapers—will be more persuasive. In some cases, the use of celebrity testimonials works well to persuade consumers to make the purchase.

Discuss the percentage of sales method used for setting the total budget for advertising.

The percentage-of-sales method involves setting the promotion budget at a certain percentage of current or forecasted sales. The percentage-of-sales method is simple to use and helps management think about the relationships between promotion spending, selling price, and profit per unit. It wrongly views sales as the cause of promotion rather than as the result. Thus, the percentage-of-sales budget is based on the availability of funds rather than on opportunities. It may prevent the increased spending sometimes needed to turn around falling sales. Finally, the method does not provide any basis for choosing a specific percentage, except what has been done in the past or what competitors are doing.

Describe the six buyer-readiness stages along with the marketing strategies used at each stage.

The six buyer-readiness stages are awareness, knowledge, liking, preference, conviction, and purchase. A marketer might use "teaser" ads to create interest and curiosity at the awareness stage. Next, marketers want to inform potential buyers of the product's high quality and its many features. Beyond knowledge, marketers want to move consumers to have stronger feelings about the product, going from liking to preference to conviction, or believing that a product is the best for them. A combination of promotion tools can be used to create positive feelings and a customer connection with the brand. The final stage is purchase, which marketers may influence through the use of premiums, add-ons, or rebates.

What is the FTC three-day cooling off rule? What purpose does the rule serve?

The three-day cooling-off rule gives special protection to customers who are not seeking products. Under this rule, customers who agree in their own homes to buy something costing more than $25 have 72 hours in which to cancel a contract or return merchandise and get their money back, no questions asked.

While using integrated marketing communications, the communications process should start with a(n) ________. A) advertising strategy B) competitive-parity analysis C) long-term public relations plan D) audit of all potential customer touch points E) strategy for implementing a social media presence

audit of all potential customer touch points

Boson Corp. is introducing consumers to its new car with the help of an advertisement campaign. This introductory campaign most likely aims to affect the ________ stage of buyer-readiness. A) liking B) awareness C) preference D) insistence E) conviction

awareness

Companies often fail to integrate their various communications to consumers because ________. A) historically, consumers have been able to distinguish between message sources B) advertising departments are reluctant to work with public relations professionals C) communications often come from different parts of the company D) personal selling and sales promotion are in direct conflict E) firms have overemphasized the concept of brand contact

communications often come from different parts of the company

Which major promotion category makes use of catalogs, telephone marketing, kiosks, and the Internet? A) sales promotion B) direct marketing C) horizontal diversification D) public relations E) advertising

direct marketing

Which of the following is one of the five major promotion tools? A) market penetration B) strategic positioning C) product line filling D) market diversification E) direct marketing

direct marketing

Which promotional tool is the most immediate, customized, and interactive? A) segmented advertising B) sales promotion C) direct marketing D) horizontal diversification E) public relations

direct marketing

Shifting away from mass marketing, marketers are developing ________ which are designed to build closer relationships with customers in more narrowly defined micromarkets. A) focused marketing programs B) horizontal diversification programs C) backward integration strategies D) new pull strategies E) new push strategies

focused marketing programs

A marketer making decisions about the headline, copy, illustration, and colors for a print ad is determining the message ________. A) structure B) content C) medium D) channel E) format

format

To carefully integrate and coordinate the company's many communications channels to deliver a clear, consistent, and compelling message about the organization and its products, some companies appoint a(n) ________. A) idea champion B) marketing communications director C) sales representative D) business analyst E) media planner

marketing communications director

The AIDA model identifies the characteristics of an effective ________. A) advertising budget B) channel of communication C) marketing message D) marketing mix E) marketing response

marketing message

In the communication process, the more the sender's field of experience ________ that of the receiver, the more ________ the message is likely to be. A) varies from; distinguishable B) overlaps with; effective C) connects with; ineffective D) coincides with; creative E) departs from; direct

overlaps with; effective

Though the ________ method of setting an advertising budget is simple to use and helps management think about the relationships among promotion spending, selling price, and profit per unit, it wrongly views sales as the cause of promotion rather than the result. A) percentage-of-sales B) integrated C) competitive-parity D) objective-and-task E) regression

percentage-of-sales

Communication through a telephone call is considered a part of a(n) ________ communication channel. A) online B) nonverbal C) personal D) nonpersonal E) unidirectional

personal

Using a(n) ________ strategy, the producer directs its marketing activities toward final consumers to induce them to buy the product. A) pull B) blitz C) push D) buzz E) pulse

pull

An ad for Maybelline age-minimizing makeup in Ladies' Home Journal magazine featured actress Melina Kanakaredes and offered readers a $1-off coupon when they tried the new makeup. In the context of the communication model, measuring which of the following would be the best way for the source to measure feedback? A) the number of subscribers to Ladies' Home Journal B) the number of people who make up the target market C) the number of people who redeem the coupon D) the number of people who have purchased Maybelline products in the past E) the number of people to whom Melina Kanakaredes is an appealing spokesperson

the number of people who redeem the coupon

A company's total marketing communications mix consists of a special blend of advertising, sales promotion, public relations, personal selling, and direct-marketing tools that the company uses to communicate customer value and build customer relationships. Which of the following terms best describes this communications mix? A) the product mix B) product line filling C) the promotion mix D) the price mix E) horizontal diversification

the promotion mix

A(n) ________ argument is most likely to be effective when the audience is highly educated or likely to hear opposing claims. A) two-sided B) one-sided C) moral D) emotional E) structured

two-sided

To communicate effectively, a marketing communicator should most likely ________. A) ensure that the encoding and decoding processes are different B) encode and decode the message personally and frequently C) understand the consumer's field of experience D) foresee unplanned static or distortion E) use familiar words and symbols

understand the consumer's field of experience

Personal communications about a product between target buyers and neighbors, friends, family members, associates, and other consumers, are known as ________. A) personal selling B) direct marketing C) public relations D) buzz marketing E) word-of-mouth influence

word-of-mouth influence