MKTG Exam 3

What is the purpose of a marketing channel?

It makes possible the flow of products and services from a producer, through intermediaries, to a buyer.

What four factors must be taken into consideration to determine the "right" price for a product?

Will the product provide a profit for the company? Will enough money be made to pay for the development and production of the product? What are customers willing to pay for the product? Will it generate enough sales dollars to pay for the marketing of the product?

Packaging and labeling not only provides benefits for the consumer, but if done successfully in a way that puts a firm in a favorable position compared to its competitors, it can provide ______ for the firm.

a competitive advantage

Price Fixing

a conspiracy among firms to set prices for a product

Opentable.com is a reservation mechanism for restaurants. It uses the Internet to allow consumers to reserve tables in many establishments throughout the United States. It is an example of

a digital marketing channel

Experience Curve Pricing

a method of pricing based on the learning effect, which holds that the unit cost of many products and services declines by 10 percent to 30 percent each time a firm's experience at producing and selling them doubles.

For nonprofit organizations, the most common form of publicity is

a public service announcement

A sequence of firms that perform activities required to create and deliver a product or service to ultimate consumers or industrial users is known as

a supply chain

Standard Markup Pricing

adding a fixed percentage to the cost of all items in a specific product class

Each intermediary in the marketing channel

adds value in terms of the functions it performs

Modifying the Product

altering one or more of a products characteristics to increase its value to customers and increase sales

Inconsistency

an opera performer may have a bad cold and give a worse-than-typical performance when you see her

Services can be classified as to whether they are delivered by people or equipment, whether they are for-profit or nonprofit, and whether or not they

are government sponsored

A gap analysis is done by

asking consumers about both their expectations of and experiences with a service

Why is price an important indicator of quality that consumers use when purchasing services?

because services are intangible, evaluating quality directly is difficult

Who is responsible for managing existing products through the stages of the life cycle?

brand manager

The set of human characteristics, such as physical traits associated with a brand, is the definition of

brand personality

Due to the fact that services are intangible and more difficult to describe, Blank______ is very important because it is a means of differentiation and helps to convey an image of quality.

branding

The integration of the marketing mix with efforts to influence consumer demand is known as

capacity management

What are the three major types of vertical marketing systems?

corporate, contractual, and administered

A customer contact audit is done by

creating a flowchart of the points of interaction between the consumer and the provider

Much more than when marketing products, service providers such as seaside hotels and restaurants have a dilemma of matching

demand and capacity

What are two responsibilities of a product manager?

developing and executing a marketing program for a product line, managing existing products through the stages of the life cycle

The way a product spreads through the population is known as

diffusion of innovation

Amazon and Orbitz are both part of ______ marketing channels. Multiple choice question.

digital

What are two criteria often used in naming successful brands?

emotional names, and names without legal restrictions

In order to meet customer expectations and sustain customer loyalty, firms that engage in internal marketing focus on what three elements?

employee skills, employee commitment, and employee attitudes

When Nestle or McDonald's modify their packaging to use more recyclable material, they are responding to what challenge regarding packaging and labeling?

environmental concerns

When a firm sells all its products under one ______, such as Pepperidge Farm, the individual products benefit from the overall brand awareness associated with it.

family brand

Multiproduct branding is also called which two of the following?

family branding and corporate branding

What are four common ways service businesses refer to price?

fares, charges, fees, and rates

Which two of the following would be considered services?

financial advice, and an airline trip

Services marketing differs from that of tangible goods, and many firms have adopted a strategy to

manage additional elements, on top of product, price, place, and promotion

Pricing ______ frequently reflect corporate goals, while pricing ______ often relate to conditions existing in the marketplace.

objectives; constraints

Because services are intangible and there may be few other available cues for the customer to judge, they frequently use ______ as an important indicator of a service's quality.

price

What term refers to money or other considerations (including other products and services) exchanged for the ownership or use of a product or service?

price

The percentage change in quantity demanded relative to a percentage change in price is known as

price elasticity of demand

FOB Orgin Pricing

price the seller quotes that includes only the cost of loading the product onto the vehicle and specifies the name of the location where the loading is to occur

Break-even analysis can help evaluate the impact of changes in ______ and ______ on ______. Multiple choice question.

prices; costs; profit

When P&G added vitamins to its Pantene shampoo and conditioner formulas, it used ______ to revamp the brand.

product modification

When a firm uses branding to identify its products and distinguish them from its competitors, its uses what elements to do so?

product names, unique symbols, and packaging design

What are two typical ways that a service can be classified?

profit/nonprofit, and delivery by person or equipment

Emphasis on availability, location, quality, and service, as well as a physical representation of the service encounter should be included in an organization's

promotional programs

Price elasticity of demand is expressed as percentage change in _____ divided by the percentage change in ______. Multiple choice question.

quantity demanded; price

The growth stage of product life cycle is characterized by more competition and a

rapid increase in sales

Quantity Discounts

reductions in unit costs for a larger order

Basing-Point Pricing

selecting one or more geographical locations from which the list price for products plus freight expenses are charged to the buyer

The scale that defines what companies bring to the market, from good-dominant to service-dominant offerings, is known as the ___ continuum

service

What are two reasons that services are difficult for consumers to evaluate?

services cannot be displayed or demonstrated prior to purchase. service providers may vary with each delivery of the service

Compared to marketing channels for consumer products, business channels exhibit what two characteristics?

the channel tends to rely on one intermediary or none at all. The channel is typically shorter

Yield Management Pricing

the charging of different prices to maximize revenue for a set amount of capacity at any given time

Intangible

the consumer cannot evaluate the quality of an airline flight before getting onboard

As it relates to the place (distribution) element of the marketing mix, what two things become the tangible components of a service?

the distribution site, and service deliverer

Inventory

there are high costs associated with paying a physician to see patients but no one schedules an appointment

Why must a marketing manager consider pricing objectives and constraints?

to narrow the range of choices among the variety of pricing strategies

is equal to the unit price for a product times the quantity of it sold.

total revenue

Modifying the Market

trying to find new customers, increase a products use among existing customers, or create new use situations

Channel conflict occurs between

two different channel members

In the profit equation, what is multiplied by quantity sold?

unit price

The ratio of perceived benefits to price is a product's

value

Small changes in price

can have comparably big effects on company profit

Efforts to influence consumer demand for a service with changes in marketing mix elements is known as ___ management

capacity

Promotional Allowances

cash payments or an extra amount of "free goods" awarded sellers in the marketing channel for undertaking certain advertising or selling activities to promote a product

Repositioning the product

changing the place a product occupies in a consumer's mind relative to competitive products, sometimes by changing by changing marketing mix elements to bolster sales

Price Discrimination

charging different prices to different buyers for products of like grade and quality

Target Pricing

consists of (1) estimating the price that ultimate consumers would be willing to pay for a product, (2) working backward through markups taken by retailers and wholesalers to determine what price to charge wholesalers, and then (3) deliberately adjusting the composition and features of the product to achieve the target price to consumers.

Factors that limit the range of prices a firm may set are known as pricing

constraints

The innovation diffusion process refers to the rate at which

consumers adopt a given product or service

Products in the ______ stage of the product life cycle tend to consume a disproportionate share of management and financial resources relative to their future worth. Multiple choice question.

decline

Loss-Leader Pricing

deliberately selling a product below its customary price, not to increase sales, but to attract customers' attention in hopes that they will buy other products with large markups

The relationship between price and quantity sold is called the

demand curve

What are the two types of marketing channels?

direct and indirect

What marketing channel allows consumers to buy products by interacting with various print or electronic media instead of a face-to-face meeting with a salesperson?

direct to consumer marketing

GE sells its large appliances directly to home and apartment builders but uses retail stores like Lowe's to sell to consumers, in a strategy known as

dual distribution

There may be several variations of product ______ within one product class, such as cassette tapes, compact discs, and digital music as variations of prerecorded music.

form

The benefits packaging and labeling provide a product include which of the following?

functional, communication, and perceptual

One of the most effective methods to assess how well an organization is delivering service to its consumers is use a(n) _____ analysis, questioning them on their expectations and experiences.

gap

The service continuum is a scale that describes an organization's offerings in terms of

how tangible or intangible they are

Management of the physical environment for services is sometimes known as ______ management.

impression

Product repositioning means changing the product's position

in the minds of consumers

What statement is TRUE about marketing channels?

indirect channels are longer than direct ones

The over 1 million ATM machines owned by Visa are an example of Visa's strategy to provide a(n) Blank______ distribution of cash. Multiple choice question.

intensive

What type of distribution places products and services in as many outlets as possible?

intensive

Because of the inseparability of services, which of the following is true about the place (or distribution) of them?

intermediaries involved in the distribution are rare

Which two factors are unique with respect to services, and are part of the four I's?

inventory, inseparability

A ______ identifies the product or brand, the package contents, and other information like where the product was made, when, and by whom.

label

Those activities that focus on getting right amount of the right products to the right place at the right time at the lowest possible cost are known as

logistics

Select two key characteristics of the maturity stage.

marketing costs are directed at holding market share and intense competition on price occurs

Pricing objectives involves specifying the role of price in what two areas of an organization?

marketing plans ad strategic plans

What two items should be considered as part of total logistics cost?

materials handling and warehousing, and order processing

What are two key characteristics of the introduction stage of the product life cycle?

minimal profit and slow growing sales

The objective of logistics management in a customer-driven supply chain is to ______ while delivering ______. Multiple choice question.

minimize logistics costs; maximum customer service

Prestige Pricing

setting a high price so that quality or status conscious consumers will be attracted to the product and buy it

Penetration Pricing

setting a low initial price on a new product to appeal immediately to the mass market

Above-, At-, or Below-Market Pricing

setting a market price for a product or product class based on a subjective feel for the competitors' price or market price as the benchmark

Customary Pricing

setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors

Target Return-on-Sales Pricing

setting a price to achieve a profit that is a specified percentage of the sales volume

Target Return-on-Investment Pricing

setting a price to achieve an annual target return on investment (ROI)

Target Profit Pricing

setting an annual target of a specific dollar volume of profit

Dynamic Pricing Policy

setting different prices for products and services in real time in response to supply and demand conditions

Product-Line Pricing

setting of prices for all items in a product line to cover the total cost and produce a profit for the complete line, not necessarily for each item

Fixed-Price Policy

setting one price for all buyers of a product or service

Odd-Even Pricing

setting prices a few dollars or cents under an even number

Skimming Pricing

setting the highest initial price that customers really desiring the product are willing to pay

Price Lining

setting the price of a line of products at a number of different specific pricing points

Inseperable

students' evaluations of their education will be influenced primarily by their perceptions of instructors, counselors, librarians, and other people at the university.

Price War

successive price cutting by competitors to increase or maintain their unit sales or market share

Cost-Plus Pricing

summing the total unit cost of providing a product or service and adding a specific amount to the cost to arrive at a price

Carlos' firm manufactures custom-made furniture that is sold through various furniture retailers. Carlos sources the wood he needs from various lumber manufacturers and uses a distributor to get his products to the retail stores for sale. The suppliers of the wood, the distributor, and the retail stores are all part of a

supply chain

The product life cycle is described as

the evolution a product goes through in the marketplace, from introduction to decline

A gap analysis evaluates service providers on the difference between

the expectations and experiences of service quality dimensions

Bundle Pricing

the marketing of two or more products in a single package price

Predatory Pricing

the practice of charging a very low price for a product with the intent of driving competitors out of business or out of a market

Everyday Low Pricing

the practice of replacing promotional allowances with lower manufacturer list prices

Uniform Delivered Pricing

the price the seller quotes that includes all transportation costs

When designing a supply chain that meets customer requirements and aligns with strategy, what are the two goals that firms try to achieve?

to be more responsive, and to be more efficient

Market modification strategies include finding new customers, increasing a product's Blank______, and creating new use situations.

use

Professionally managed and centrally coordinated marketing channels that are designed to achieve channel economies and maximize marketing impact are known as

vertical marketing systems