Marketing Exam 3

Jane has realized that she does not enjoy taking a taxi to work because there is substantial ______ in the delivery of the service depending on who is driving her cab that day.

heterogeneity

Warehouse club stores like Sam's Club or Costco offer customers low prices on a variety of merchandise, but often the merchandise is sold in large-quantity packaging. This is an example of a(n) ______ discount

size

Which of the following are benefits that a service provider receives from engaging in effective service recovery?

Improved word of mouth Increased purchase intention

One of the best ways for managers to reduce the ______ gap is to conduct ongoing research and regularly talk with employees to explain what customers expect to get from the brand and the firm

knowledge

Which strategy is used by firms that believe increasing volume of sales will help the firm more than increasing profits?

Sales-oriented strategy

The marketing manager needs to communicate with customers and employees on an ongoing basis in order to understand buyers' expectations and to reduce the ______ gap

knowledge

One of the most effective methods to assess how well a firm is delivering adequate service to consumers is to employ the ______ Model to evaluate their service provision

Service Gaps

Which of the following characteristics is NOT one that distinguishes services from products? Heterogeneity Volatility Intangibility Perishability Inseparability

Volatility

Generally, the ______ and more sophisticated a firm is, the ______ likely it will be to use supply chain intermediaries

larger; less

Money paid to stores to stock new products or to devote extra shelf space to products is known as ______

a slotting allowance

Cost-based pricing does NOT consider the influence of ______ on the marketplace

consumers

A company prices all of its products at twice what it costs to produce them. The company is using a ______-based pricing method.

cost

The percentage change in the quantity of one product demanded compared with the percentage change in price in another product is called ________-price elasticity

cross

In the United States, it is considered unethical and illegal for advertisements to ______ the consumer so much that the person is harmed

deceive

One difference between products and services is demonstrated by a hair salon, where the stylist delivers the service at the same time the customer receives it. This is called ______

inseparability

Total cost equals _____

variable costs plus fixed costs

To estimate a product's ______, consumers consider what they expect to get from the product in addition to what they will need to sacrifice to acquire it.

Value

MAC, a brand of makeup produced by Estée Lauder, sells through the company's retail outlets. Therefore, whenever a new MAC product is made, it is automatically brought into Estée Lauder retailing outlets. Which type of channel structure does this setup represent?

Vertical marketing system

With the ______ pricing strategy, a company adopts retail prices that are typically somewhere between the product's regular price and the sharply discounted sale prices that competitors occasionally offer

everyday low

The strategy of ______ appeals to consumers because it reduces their need to spend time comparing prices at various stores.

everyday low pricing (EDLP)

A rebate is a type of discount issued by a retailer.

False

Which of the following is another term for target return percentage?

Markup

Businesses tailor their pricing strategies to each product/service and ____

target market

Which of the following types of theories is the maximizing profits strategy based on?

Economic

Retailers help satisfy customers' needs regarding product by providing which of the following?

An assortment of products geared toward their target market A mix of services relating to the products they sell Products in the quantities their customers wish to buy

Which of the following refers to the controllable characteristics of a store related to presentation?

Atmospherics

To determine how much integration is best, each retailer must address issues such as which of the following?

Brand image Supply chain Pricing Integrated CRM

What retailer offers a narrow but deep assortment of merchandise?

Category specialists

Which of the following is NOT a pricing tactic aimed at consumers?

Cumulative discounts

Which of the following are characteristics that make marketing services different from product marketing?

Heterogeneity Perishability Intangibility

What are some common problems caused by the use of technology in a service setting?

Customers do not understand how to use the technology. The technology does not perform adequately. Customers dislike replacing humans with machines.

Knowledge matches - Diners at a restaurant think the portions are too small, but the manager is unaware of this complaint. Standards matches - Management believes that customers in a restaurant think the service is very slow, however, management allows servers to stand around and chat.

Delivery matches - A restaurant usually serves fresh bread made on the premises, but at the end of the day the ovens are shut down early and only cold loaves are available. Communication matches - A restaurant advertises they are open for breakfast, but when guests arrive on Sunday morning, there is a sign on the door indicating they are only open for brunch at 11:00.

A firm may set low prices to do which of the following?

Discourage new firms from entering the market Take market share away from competitors Encourage current firms to leave the market

If a company begins selling new products to a new target market, it should extend its current pricing strategies to the new products.

Falsae

Cash discounts are reductions retailers take in the initial selling price of the product or service.

False

Puffery is illegal in advertising.

False

True or false: A firm with a primary objective of very high sales growth will have the same pricing strategy as a firm with a primary objective of being a quality leader.

False

True or false: The important characteristics of retailers are the same in every industry

False

Which of the following do you need to know to calculate target return price?

Fixed costs Expected unit sales Variable costs

A business that experiences service delivery gaps can use which of the following methods to improve the quality of its service?

Provide incentives and support for service providers Implement self-service technologies Empower employees to work in the customer's best interest

Which of the following has the highest "hassle factor" for the consumer?

Rebates

Which of the following is NOT an actual distribution intensity level considered by manufacturers

Retentive

Unlike Estée Lauder, which is a large and established firm with the resources to provide itself with its own sales force to sell its products, smaller firms will probably need to rely on which of the following to help to distribute its products?

Supply chain intermediaries

Which of the following statements are true of seasonal discounts?

They are offered to retailers so they will stock up on seasonal merchandise in advance. They can help retailers make a larger profit. They help manufacturers plan their production schedule.

Which of the following are true of leader pricing, price lining, and price bundling?

They are pricing tactics. They are aimed at consumers.

Which of the following are true of pricing tactics?

They are widely accepted methods of setting short-term prices. They can be used to counter a competitor's temporary sale prices.

How do markdowns benefit a store?

They call attention to the store's merchandise. They make promotions more successful. They entice customers into the store, where they might buy other things.

Which of the following are true of rebates?

They can be offered and then halted if needed. Most customers never redeem them.

What are the advantages of rebates?

They help manufacturers collect information about consumers. Retailers do not have to pay employees to handle rebates. They help manufacturers ensure that the consumer gets the discount, not the retailer.

Which of the following statements are true of seasonal discounts

They help manufacturers plan their production schedule. They can help retailers make a larger profit. They are offered to retailers so they will stock up on seasonal merchandise in advance.

Which of the following statements are true of seasonal discounts?

They help manufacturers plan their production schedule. They can help retailers make a larger profit. They are offered to retailers so they will stock up on seasonal merchandise in advance.

Which of the following are true of coupons?

They offer an immediate discount on items purchased. They encourage first-time users to become regular users.

Which of the following statements about service retailers are true?

They primarily sell services rather than merchandise. They include health clubs and dry cleaners. They are a large part of the retail industry.

What are the drawbacks of coupon promotions?

They sometimes annoy customers. They sometimes confuse customers. They may not lead to any net increase in sales.

Which of the following is NOT a reason retailers have markdowns?

To comply with the FTC

Why do retailers use markdowns as a pricing tactic?

To sell products out of season To dispose of products that have not been selling well To match low prices offered by competitors

Why do retailers use markdowns as a pricing tactic?

To sell products out of season To match low prices offered by competitors To dispose of products that have not been selling well

The general price range of the products offered by a retailer helps define its image.

True

Which of the following is not a type of retailer that falls under the general merchandise retailing category?

Wholesalers

Customer service is best represented by which of the following statements? Customer service ______

adds to marketing efforts by helping to meet the customers' needs and wants

Guitar Center reinforces its image of selling high-quality musical equipment in its stores and catalogs and on its website. This is an example of providing a consistent ______ across all channels

brand image

It is very important for the retailer to provide a consistent ______ across all channels

brand image

Consumers typically compare a firm's products and prices with those offered by _____

direct competitors

When consumers relish the challenge of getting the lowest price and are willing to expend the time and effort to seek out the lowest price every time, retailers should use the ______ pricing strategy.

high/low

The primary reason there is greater heterogeneity in services than in products is because ______

human inputs generate differences

One of the basic ways in which services differ from products is that production and consumption are ______ from each other. Consequently, service providers often include options for the customer to become more involved in the production of the service, which usually results in greater customer satisfaction

inseparable

After the holidays, a national retailer reduces the prices of popular holiday gift items to attract consumers who were unwilling to brave long lines or pay higher prices before the holiday. This pricing tactic is called a _____

markdown

When a retailer reduces the initial selling price of a product or service, the pricing tactic is called a _____

markdown

The goal of a(n) ______ strategy is to generate profit and establish a new product or service in the market as quickly as possible

market penetration

When a new product or service is launched, companies that use a ______ strategy will attempt to attract customers quickly by offering a very low price at first.

penetration pricing

The ratio of change in a price and its effect on the quantity of the product demanded is known as _____

price elasticity of demand

A situation [or competition] that occurs when two or more firms compete primarily by lowering their prices.

price war

The equation for price elasticity of demand is the percentage change in quantity demanded divided by percentage change in _____

prices

Competition, channel members, costs, customers, and company objectives are the five critical components of ____

pricing

Sometimes firms selling a pioneering product will set a very low price in order to attract many customers before competitors enter the market. This is an example of a ______ orientatio

sales

Customer _______ refers to human or mechanical activities undertaken by firms to help satisfy their customers' needs and wants

service

Firms that are less concerned with the level of profits and more interested in the rate at which profits are generated relative to their investments tend to use ______

target return pricing

When a firm uses a mathematical model to identify the price at which the firm will make the most money possible, it is implementing ____

the maximizing profits strategy