marketing chapter 1

Walmart has traditionally utilized an everyday low price strategy in its continued efforts to be the number one global retailer. They recently launched an application called the Walmart Savings Catcher to ensure consumers receive the lowest possible prices compared to the competition. Which of the following slogans would be most appropriate for Walmart to use to communicate the message of everyday low prices most effectively?

"Low Prices, Big Value"

General Motors (GM) continues to demonstrate a high level of value to customers and recent industry research reported that 12 million customers made repeat purchases of GM automobile products in 2017. In addition, GM maintains a high level of customer loyalty with an overall loyalty rating of 69.1% indicating that 69.1% of customers buying GM products in 2017 were previous owners of GM automobiles or trucks. GM's ability to generate high levels of customer loyalty demonstrates the firm is engaging in _______.

$1,500

Considering the costs associated with implementing marketing activities, if a consumer pays $52 for a pair of jeans, approximately how much of that price is associated with activities related to marketing (promotion, distribution, and profit margins)?

$26

Customs duties on merchandise imports are called tariffs. Tariffs give a price advantage to locally produced goods over similar goods that are imported, and they raise revenues for governments. In August 2018 Turkey notified the World Trade Organization Secretariat of a request for dispute consultations with the United States regarding measures it recently adopted to modify its tariff concessions on steel and aluminum imports. This situation of one country (Turkey) seeking an audience with the United States is an example of which of the following types of forces that constantly impact a company's dynamic marketing environment?

.Political force

From _______ % of all civilian workers in the United States performs marketing activities.

25 to 33

Marketing activities are a large component impacting the price of products and services. Approximately what percentage of a good's monetary price is associated with marketing activities?

50%

Which of the following is the best example of a service organization?

American Airlines

Which of the following statements best exemplifies the requirements for maintaining exchange relationships?

Both the buyer and seller must be satisfied

Which of the following statements is true about target markets?

Companies can target multiple markets.

A firm builds its marketing mix around which of the following elements?

Customer

Which of the following expressions best characterizes the concept of value to consumers?

Customer benefits - customer costs = value

Executives at The North Face would like to sell coats, fleece jackets, hats, and other cold weather gear in vending machines at airports in cold weather climates. This would appeal to customers who forgot to pack cold weather essentials. If implemented, The North face would be modifying which variable of the marketing mix?

Distribution

Lebron has recently begun working for Kimberly-Clark, a consumer products company headquartered in Dallas, Texas, manufactures of well-known brands such as Kleenex and Huggies diapers. Lebron completed a degree in marketing and will primarily be responsible for managing inventory levels, transportation, and storage costs as well as fulfilling retail orders and ensuring timely delivery to customer accounts. Lebron will work with vendors who have established relationships with the company and refine Kimberly-Clark's interactions with both its suppliers and other market intermediaries. Lebron's job responsibilities primarily relate to which of the following marketing mix variables?

Distribution

The activities related to making products available in the quantities desired to as many target market customers as possible is part of which element of the marketing mix?

Distribution

You are starting a new job next week at a consumer products company in Redmond, Washington. You will be responsible for managing the company's inventory levels, as well as the related transportation and storage costs. You will rely heavily on some previously-established relationships as you refine the firm's interactions with its various intermediaries. Your job responsibilities primarily relate to which of the following marketing mix variables?

Distribution

A recent Council of Supply Chain Management Professionals meeting featured an executive from Caterpillar, largely considered the world's leading manufacturer of construction and mining equipment. The executive discussed the capabilities of the firm regarding tracking the carriers or transportation vendors who facilitate the movement of parts needed for manufacturing as well as finished goods. The company utilizes a solution from GT Nexus which provides end-to-end visibility of its carriers across different shipping modes including air transportation, ocean, inland waterways, and over-the-road trucking. The GT Nexus technology solution tracks on-time performance of the carriers within each shipping mode and assists Caterpillar in determining the cost-effectiveness of specific carrier vendors as well as shipping modes. Caterpillar utilizes the information to assist them in its decision-making as to when to utilize different modes of transportation (e.g., air freight versus ocean) as well as decisions within a mode (e.g., one-day air versus two- or three-day air). In addition, Caterpillar engages in customer analysis research to determine consumers' sensitivity to price as well as the importance of timely delivery. Additional insight regarding customer needs aids Caterpillar in its judgments about pricing and delivery schedules for parts and equipment. Caterpillar's investment in the technology solution as well as customer insights has helped the company achieve its revenue and profitability goals. Refer to Scenario 1.2. Which variable of the marketing mix is most impacted by Caterpillar's use of the GT Nexus solution?

Distribution variable

Which of the following activities would NOT be part of a market orientation?

Focusing on building short-term relationships with customers to drive revenue and profitability

Zappos, an online shoe retailer, realizes that there is some risk involved in buying shoes online. Customers may order the wrong size, or simply not like the shoes once they receive them. In order to help increase value and eliminate risk, which of the following is appropriate for Zappos?

Free shipping and free returns

Which of the following is the best example of a firm implementing the marketing concept?

Frito-Lay's sponsorship of the contest, "Do Us A Flavor" to gain involvement of customers in new chip flavors through online voting and purchase volume

Which of the following are the three forms of a product?

Ideas, services, and goods

Which of the following are the three primary ways firms can achieve profits through managing customer relationships?

Keeping customers for a longer period of time, enhancing profitability of existing customers, and acquiring new customers

Ballast Point, a brewery based in San Diego, recently introduced a new cocktail-inspired product to its growing portfolio: Moscow Mule Ale. Moscow Mule Ale is available nationwide is the first cocktail-inspired beer for the brewery. The Moscow Mule Ale was developed to appeal to customers who are choosing mixed drinks instead of beer products. In this case, Ballast Point is most likely utilizing which approach to marketing?

Market orientation

Recent research conducted by Aeropostale was focused on understanding the shopping habits and desires of its target market—the Millennial generation. The results indicate that Millennials are more interested in spending time shopping as a source of entertainment rather than purchasing products or services. The research identified that approximately 50% of surveyed customers enjoy browsing for items but have no intention of purchasing. In addition, those surveyed state that they only purchase products they believe are necessary and many young consumers are willing to pay full retail price. Based upon the results of this research, the Aeropostale organization must consider how to redesign the stores and shopping experiences to create an enhanced entertainment experience for its customers. Based upon this information, which orientation best applies to Aeropostale?

Market orientation

Which of the following statements best describes the application of marketing activities to organizations?

Marketing activities can be utilized by a variety of organizations, such as governmental agencies, nonprofit, and for-profit businesses.

A junior marketing major is interviewing for a marketing internship position for the summer and has been asked to make a presentation about marketing to the interview team. Which of the following statements should the student make when defining marketing or marketing activities?

Marketing can be defined as the process of creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers.

Marketing is important to businesses and the economy. Which of the following statements best summarizes the importance of marketing activities?

Marketing helps create a successful economy and contributes to the well-being of society.

Which one of the following statements is true regarding the global impact of marketing?

Marketing improves the quality of life of customers.

Which areas or functions of an organization are impacted when a company chooses to adopt the marketing concept?

Marketing, management, finance, and accounting functions

Karl is the owner of a landscaping company and is considering the purchase of a new skid steer. He's evaluating different brands and models to determine the relative value of each model as well as the benefits they offer. Which of the following would NOT be considered a customer benefit as part of his determination of the product's value?

Monetary price

Customer costs can be defined as anything the buyer must give up in order to obtain the benefits the product provides. Which of the following is the most obvious customer cost?

Monetary price of the product

Which of the following is the most accurate listing of marketing environmental forces?

Political, legal and regulatory, technological, sociocultural, competitive, and economic

A new company, Clean Ethics is marketing a cleaning product called Bottle Bright. Bottle Bright is available in three sizes: a 12-count pouch for $8, a 3-pack 12-count pouch (36 tablets) for $22, and a 12-pack 12-count pouch (144 tablets) for $80. The Clean Ethics founders were featured on the TV show, Shark Tank and shared their idea and product history. Their journey began appropriately at a trailhead—fresh off a mountain bike ride that was endured with noticeably less than fresh tasting water. They were fed up with the grime that plagued their hydration packs and water bottles, and the lack of suitable methods to clean them. After years of choosing between stains and odors or toxic chemicals, they set out to create the safest and most effective product for maintaining hard-to-clean drinking containers. In addition, the founders conducted considerable market research to determine consumers' needs for cleaning products and likelihood to purchase an environmentally friendly cleaning product. Their background in renewable fuel production provided the relevant experience in chemistry and product development. After countless hours spent researching and testing, their unique all-natural formula was born. Bottle Bright cleans water bottles, travel mugs, and other hard-to-clean drinking vessels, is biodegradable, chlorine free, all natural, removes stubborn stains and odors, and is certified by The Natural Products Association. In addition, the founders recognized that the problem of dirty water containers carries more serious risks to people in developing countries and they committed to leveraging sales to give Bottle Bright to the people that need it most. The company uses the slogan, "Clean in Kind - Buy clean. Give clean." to educate and remind consumers about this mission and how a purchase of Bottle Bright tablets will provide clean water to those who need it most. Refer to Scenario 1.1. Clean Ethics' main competitive advantage over traditional cleaning products comes from its attention to which element in the marketing mix?

Product

Pringles recently announced the introduction of Pringles Double Stacks—wider cans that hold two rows of potato snack chips. Which variable of the marketing mix is Pringles modifying with this introduction?

Product

Which business orientation best characterizes the period of time when businesses began utilizing technology and production techniques such as assembly lines to manufacture products in a more efficient manner?

Production orientation

Which element of the marketing mix is utilized to create consumer awareness of the organization and its products?

Promotion

Which of the following would NOT be a value required by organizations striving to become more market oriented?

Recognition

U.S. Electric, the maker of a highly innovative xenon light bulb used in large, manufacturing facilities, finds that it has excess inventory. The firm increases its direct marketing budget by 20% and adds three new sales representatives. This company is operating as if it were in which of the following orientations?

Sales

CertainTeed Corporation, a manufacturer of building materials had an excess inventory of roofing materials such as shingles. In response to the excess inventory, CertainTeed increased its advertising budget by 20% and hired two additional sales representatives to further penetrate the roofing and building materials marketplace. Based upon CertainTeed's response to its excess inventory, which business orientation are they most likely implementing?

Sales orientation

_______ can be customers, employees, investors, suppliers, and communities—anyone that has an interest in some aspect of a company's products

Stakeholders

A recent Council of Supply Chain Management Professionals meeting featured an executive from Caterpillar, largely considered the world's leading manufacturer of construction and mining equipment. The executive discussed the capabilities of the firm regarding tracking the carriers or transportation vendors who facilitate the movement of parts needed for manufacturing as well as finished goods. The company utilizes a solution from GT Nexus which provides end-to-end visibility of its carriers across different shipping modes including air transportation, ocean, inland waterways, and over-the-road trucking. The GT Nexus technology solution tracks on-time performance of the carriers within each shipping mode and assists Caterpillar in determining the cost-effectiveness of specific carrier vendors as well as shipping modes. Caterpillar utilizes the information to assist them in its decision-making as to when to utilize different modes of transportation (e.g., air freight versus ocean) as well as decisions within a mode (e.g., one-day air versus two- or three-day air). In addition, Caterpillar engages in customer analysis research to determine consumers' sensitivity to price as well as the importance of timely delivery. Additional insight regarding customer needs aids Caterpillar in its judgments about pricing and delivery schedules for parts and equipment. Caterpillar's investment in the technology solution as well as customer insights has helped the company achieve its revenue and profitability goals. Refer to Scenario 1.2. Which environmental factor did Caterpillar leverage to implement a solution to track shippers and study the on-time delivery rates for each transportation vendor?

Technological

Focusing on the share of customer requires that marketers recognize that not all customers in a target market have the same needs and wants—they need to be considered individually. Which of the following is the best application of this idea?

The 80/20 rule

Amazon made the news recently for banning customers that returned too many items. These customers had their accounts closed and they are unable to make any other purchases. Which of the following might be a likely explanation for Amazon's actions?

The customer lifetime values of the banned customers generated a net loss.

Which of the following statements best reflects the level of acceptance of the marketing concept by firms in the United States?

The marketing concept has yet to be fully accepted by all organizations

Which of the following statements is true regarding the marketing concept?

The marketing concept is a managerial philosophy guiding all aspects of an organization's business.

The marketing environmental forces can have a profound effect on marketing activities. Which statement best describes the forces?

The marketing environment forces change dramatically and quickly, and a change in one force is likely to affect the other forces.

Which statement best describes the marketing concept from the viewpoint of a company president or CEO?

We have created a business culture where our focus is on the customer to ensure his or her needs and wants are met.

A specific group of customers on whom an organization focuses its marketing efforts is known as _______.

a target market

The marketing concept is a _______ that guides the overall activities of an organization. It has evolved over time from a _______ in the second half of the 19th century to a _______ today.

b.management philosophy; production orientation; market orientation

Firms utilizing customer relationship management (CRM) must first identify patterns of _______ and then use that information to focus on the most promising and profitable customers.

buyer behavior

Managing customer relationships requires identifying patterns of _______ and then using that information to focus on the most promising and profitable customers.

buying behavior

Aldi's, the grocery store chain partners with a large number of consumer products companies to manufacture private label products that are similar to name-brand products found in other grocery store aisles. One cookie manufacturer suggests that Aldi's modify the volume of product it includes in the package but keep the package size the same. Thus, consumers would receive fewer cookies but not recognize the difference because the packaging looks the same as the name-brand variety. Aldi's marketing buyer warns the cookie manufacturer that this might be a bad idea because Aldi's long-term survival, like most companies, depends on _______.

creating and maintaining satisfying exchange relationships

The key objective of customer relationship management (CRM) is _______.

creating long-term relationships with profitable customers

Companies today are seeking ways to create stronger and more frequent interactions with customers to establish beneficial long-term relationships. For example, Southwest Airlines encourages customers to join its membership program and provide key contact information such as their email, address, and phone number. Southwest Airlines offers benefits such as upgrades and free travel based on the number of flights or points a customer has accumulated. This example demonstrates how Southwest Airlines is utilizing _______.

customer relationship management

The central focus of all marketing activities are _______.

customers

One notable belief of the market orientation era is _______.

determine what customers want and develop those products

In managing customer relationships, the three primary ways profits can be obtained are by _______

enhancing the profitability of existing customers, extending the duration of relationships with customers, and acquiring new customers

A new company, Clean Ethics is marketing a cleaning product called Bottle Bright. Bottle Bright is available in three sizes: a 12-count pouch for $8, a 3-pack 12-count pouch (36 tablets) for $22, and a 12-pack 12-count pouch (144 tablets) for $80. The Clean Ethics founders were featured on the TV show, Shark Tank and shared their idea and product history. Their journey began appropriately at a trailhead—fresh off a mountain bike ride that was endured with noticeably less than fresh tasting water. They were fed up with the grime that plagued their hydration packs and water bottles, and the lack of suitable methods to clean them. After years of choosing between stains and odors or toxic chemicals, they set out to create the safest and most effective product for maintaining hard-to-clean drinking containers. In addition, the founders conducted considerable market research to determine consumers' needs for cleaning products and likelihood to purchase an environmentally friendly cleaning product. Their background in renewable fuel production provided the relevant experience in chemistry and product development. After countless hours spent researching and testing, their unique all-natural formula was born. Bottle Bright cleans water bottles, travel mugs, and other hard-to-clean drinking vessels, is biodegradable, chlorine free, all natural, removes stubborn stains and odors, and is certified by The Natural Products Association. In addition, the founders recognized that the problem of dirty water containers carries more serious risks to people in developing countries and they committed to leveraging sales to give Bottle Bright to the people that need it most. The company uses the slogan, "Clean in Kind - Buy clean. Give clean." to educate and remind consumers about this mission and how a purchase of Bottle Bright tablets will provide clean water to those who need it most. Refer to Scenario 1.1. The customers of Clean Ethics are most likely choosing the Bottle Bright product because of its _______, which is evidence of a _______.

environmental consciousness; market orientation

Apple's ability to deliver products that customers want to buy and generate high levels of customer satisfaction as well as profits and shareholder wealth demonstrates Apple's ability to facilitate _______.

exchanges

Consumers perceive products with the lowest price as having the lowest value.

false

For an exchange situation to arise, only one condition must exist: two or more individuals, groups, or organizations must each possess something that they value and are willing to give up receiving "something of value" held by the other individuals, groups, or organizations.

false

The marketing concept deals only with marketing activities.

false

A tangible or physical product that can be touched, seen or felt is referred to as a(n) _______.

good

When organizations pursue initiatives to improve their ability to make a positive impact on society and the natural environment, they are engaging in _______.

green marketing

Marketing professionals understand the challenges and implications of marketing in an inter-connected, global economy. While the discipline is primarily focused on building mutually-beneficial customer relationships for the firm, it has many other positive influences on the global economy that many in the general public are not aware of. For example, marketing creates a successful economy and leads to a _______ for people all over the world. Additionally, _______ can promote the welfare of customers and the firm's stakeholders.

higher standard of living; socially responsible marketing

The minister for a local church affiliated with the United Methodist Church is most likely considered to be marketing _______.

ideas

The City Council in Santa Barbara, California adopted an ordinance banning the sale of plastic straws at food and beverage providers like restaurants, coffee shops, and smoothie bars. For Jamba Juice in Santa Barbara, this change impacts its

legal and regulatory forces.

A change in the minimum drinking age in any given state illustrates a change in the _______ for MillerCoors brewing company.

marketing environment

A change in the national standards and requirements for school lunches and dietary guidelines is an example of a change in the _______ for companies like Aramark that serve more than 370 million meals to more than 2 million children around the United States.

marketing environment

A marketing manager for a regional distributor of beer and alcoholic beverages 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

Product, price, distribution, and promotion are all components of a firm's _______.

marketing mix

Marketing managers strive to develop a marketing mix that _______.

matches the needs of the target market

A locally owned sporting goods retailer carries the best-selling Nike Elite basketball socks. Due to the popularity of the socks, the store markets the products in single and multiple formats—one pair for $18 or three pairs for $50, which provides a discount to those who purchase three pairs at one time. Which element of the marketing mix is the sporting goods retailer modifying with this special offer?

price

A new company, Clean Ethics is marketing a cleaning product called Bottle Bright. Bottle Bright is available in three sizes: a 12-count pouch for $8, a 3-pack 12-count pouch (36 tablets) for $22, and a 12-pack 12-count pouch (144 tablets) for $80. The Clean Ethics founders were featured on the TV show, Shark Tank and shared their idea and product history. Their journey began appropriately at a trailhead—fresh off a mountain bike ride that was endured with noticeably less than fresh tasting water. They were fed up with the grime that plagued their hydration packs and water bottles, and the lack of suitable methods to clean them. After years of choosing between stains and odors or toxic chemicals, they set out to create the safest and most effective product for maintaining hard-to-clean drinking containers. In addition, the founders conducted considerable market research to determine consumers' needs for cleaning products and likelihood to purchase an environmentally friendly cleaning product. Their background in renewable fuel production provided the relevant experience in chemistry and product development. After countless hours spent researching and testing, their unique all-natural formula was born. Bottle Bright cleans water bottles, travel mugs, and other hard-to-clean drinking vessels, is biodegradable, chlorine free, all natural, removes stubborn stains and odors, and is certified by The Natural Products Association. In addition, the founders recognized that the problem of dirty water containers carries more serious risks to people in developing countries and they committed to leveraging sales to give Bottle Bright to the people that need it most. The company uses the slogan, "Clean in Kind - Buy clean. Give clean." to educate and remind consumers about this mission and how a purchase of Bottle Bright tablets will provide clean water to those who need it most. Refer to Scenario 1.1. Which element of the marketing mix is Clean Ethics focusing on through its offer of the three different product packages and reflected in the significant monetary savings associated with the 12-pack 12-count pouch purchase?

price

The most flexible variable of the marketing mix is _______.

price

Before Volkswagen released the brand-new Atlas SUV, the company needed to be sure consumers were aware of the new vehicle's features. The best way to do this was through which marketing mix variable?

promotion

When McDonald's adds new items to its menu, they must educate its target audience about the new items in order to stimulate purchase and motivate consumers to visit their local McDonald's restaurant. This calls for activity in which of the following marketing mix variables?

promotion

Boca Burger's website features information about products, recipes, and nutritional values, but customers cannot actually purchase products from the website. This website is most likely used primarily as a _______ marketing tool.

promotional

Frito Lay's website features information about products, recipes, nutritional values, and contests, but customers cannot actually purchase products from the website. The Frito Lay website is most likely used primarily as a _______ marketing tool.

promotional

Starbucks has introduced some of its products into supermarkets, vending machines, college campuses, and other locations to increase its product availability and convenience. One reason Starbucks has chosen to expand its distribution is to _______.

provide greater value to customers

Organizations who strive to create long-term, mutually beneficial arrangements where both buyers and sellers are focused on the creation of value through satisfying exchanges are employing a(n) _______ marketing approach to business.

relationship

Pursuit of product innovation and product development has been a key component to ensure Apple's success over the years. The company has licensed a variety of patents including ones that allow multiple finger and palm contacts with devices. In addition, they have patents that allow for integration of typing, resting, pointing, scrolling, 3D manipulation, and handwriting. The patents and innovation demonstrate how Apple has been able to leverage _______ changes in the marketing environment by providing customers with a variety of new products such as the Apple Watch, iPad, iPhone, and Mac laptops/desktops.

relationship marketing

Following the time period associated with the production orientation, competition increased, and demand for products declined. During this time frame between the 1920s and the 1950s, organizations followed a _______ orientation.

sales

According to the marketing concept, firms should achieve their goals and simultaneously _______.

satisfy consumer needs

Relationship marketing and customer lifetime value can help marketers focus on individual customers rather than a group of people who share similar interests; that is, marketers focus more on the share of customer rather than the _______.

share of market

With the increasing Hispanic population in the United States, retailers and service providers have created products and services targeted to Spanish-speaking customers. DirecTV, for example, offers several Spanish entertainment packages. DirecTV altered its product offerings due to a change in the _______ forces.

sociocultural

Demand for manufactured goods during the Industrial Revolution was _______.

strong

In order to be successful in creating mutually-beneficial exchanges with customers, the marketer must focus on creating value in fact and in the mind of the customer. For the most part, value is a customer's _______ assessment of benefits relative to costs. The marketer should recognize that the process people use to determine value _______.

subjective; is not scientific

Janelle has just graduated with a degree in marketing. She accepted a job with Westfield Corp. and will be responsible for maintaining the flow of products through physical distribution activities. She will be responsible for acquiring resources and inventory and making products available to customers through purchasing, logistics, and operations. Janelle's job will be in _______.

supply chain management

A commercial for the drink SunnyD explains how nutritious it is in comparison to other, more "sugary" drinks. While children under 12 are the most likely consumers of SunnyD, the commercial is aimed at mothers. These mothers represent SunnyD's _______.

target market

Capri Sun uses the tagline, "Good for Moms, Awesome for Kids." This advertising tagline emphasizes that Capri Sun is promoting the product for moms even though kids are likely to be consuming the product. Thus, the moms represent Capri Sun's _______.

target market

The Nike Fuel Band is aimed at active individuals ages 20 to 40 who want to track their fitness goals, connect their smart devices, and share their activities with others. This description of people describes Nike Fuel Band's _______.

target market

If a family spends $3,000 each month on goods and services, how much of that $3,000 can be associated with the cost of marketing activities?

technological

In April 2015 the restaurant chain Chipotle announced it would stop using genetically modified food products. "This is another step toward the visions we have of changing the way people think about and eat fast food," said Steve Ells, founder and former co-CEO of Chipotle. This decision indicates a response to concerns about _______.

the marketing environment

StarKist Tuna announced a dolphin-safe policy and stopped buying tuna from fishing vessels that net dolphins. This decision indicates a response to concerns about _______.

the marketing environment

Product, distribution, promotion, and price are commonly referred to as _______.

the marketing mix

Marketing is_______.

the process of creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers and to develop and maintain favorable relationships with stakeholders in a dynamic environment

A family that organizes and advertises a garage sale is performing marketing activities.

true

Marketing activities do not always result in exchanges.

true

A customer's subjective assessment of benefits relative to costs in determining the worth of a product is known as _______.

value

The equation: value = customer benefits - customer costs is known as _______.

value