BNAD 303 Test 3 (9-12) Review Questions

​____________can promote the sales of products consumers might not otherwise​ buy, but the combined price must be low enough to get them to buy the package.

Price bundling

Which of the following statements is true regarding how price might play an important role in helping to accomplish company​ objectives?

Pricing can create excitement for a brand

New retail forms continue to emerge.​ However, different types of retailers are increasingly serving similar customers with the same products and prices​ (retail convergence), making​ __________ more difficult.

differentiation

Buyer reactions to price changes are influenced by the​ ________.

meaning customers see in the price change

Most producers use intermediaries by forging a marketing channel​ (or distribution​ channel) to bring products and services to the consumer or business user. They do this because​ ____________________________, specialization, and scale of operation.

of the​ intermediaries' contacts and experience

Companies design a​ _______ that covers all their products.

pricing structure

There are several types of product mix pricing​ situations, which include​ ______________, by-product pricing and product bundle pricing.

product line​ pricing, optional-product​ pricing, captive-product pricing

In pricing innovative new​ products, a company can use​ ________ by initially setting high prices to maximize the amount of revenue from various segments of the market.

​market-skimming pricing

Customers weigh the price of a product against the perceived values of using the product. Companies must understand concepts like​ _______ and​ ________.

​price-demand relationship; consumer sensitivity to prices

When channel members​ cooperate, they can more effectively​ _________________.

​sense, serve, and satisfy the target market

The strategy for setting a​ product's price often has to be changed when the product is part of​ _______________, which looks for a set of prices that maximizes its profits on the​ _______________.

a product​ mix; total product mix

When assigning functions to channel​ members, it is important for producers to​ ________.

assign functions to the channel members that can add the most value for the cost

Marketing channels perform many key functions. Some help​ ______________by gathering and distributing information needed for planning and aiding exchange as well as developing and spreading persuasive​ ______________ about an offer.

complete​ transactions; communications

​Value-based pricing begins with analyzing​ ___________.

consumer needs and value​ perceptions, and the price is set to match perceived value

The price​ ceiling, the maximum price a company can​ charge, is set by​ ________.

customer perceptions of the​ product's value

The three major pricing methods include​ ______.

customer​ value-based pricing,​ cost-based pricing, and​ competition-based pricing

One price adjustment strategy is​ ______________________ pricing, whereby the company establishes​ cash, quantity,​ functional, or seasonal​ discounts, or varying types of allowances.

discount and allowance

New types of channel organizations have appeared that​ _________________.

provide stronger leadership and improved performance

Disintermediation

reduction in the use of intermediaries between producers and consumers

The trend of​ ________ has resulted in different types of retailers now selling the same products at the same prices to the same consumers.

retail convergence

Another price adjustment strategy is​ ______________ pricing, where the company sells a product at two or more prices to accommodate different​ customers, product​ forms, locations, or times.

segmented

Major retail trends and developments include the rise of​ megaretailers, rapid growth of​ direct, online,​ mobile, and social media retailing. Other trends include​ __________________.

the growing importance of retail​ technology, surge in green retailing and global expansion of major retailers

External pricing considerations include​ ________________________________ such as the​ economy, reseller​ needs, and government actions.

the nature of the market and demand and environmental factors

The company that faces a price change initiated by a competitor must try to understand the​ ________ as well as the​ _______.

​competitor's intent; likely duration and impact of the change

Which of the following statements is true regarding channel​ organization?

Channel members are dependent on each other for the overall success of the channel.

What are the three major pricing strategies used by​ marketers?

Customer​ value-based pricing,​ cost-based pricing, and​ competition-based pricing

Which of the following statements is true regarding initiating price​ cuts?

Cutting prices in an industry loaded with excess capacity might lead to price wars.

Which of the following statements about major retail trends is​ true?

Online buying is growing at a much brisker pace than retail buying as a whole

What are the five product mix pricing​ situations?

Product line​ pricing, optional-product​ pricing, captive-product​ pricing, by-product​ pricing, and product bundle pricing

Many state colleges and universities charge one price for​ in-state students and a higher price for​ out-of-state students. Which price adjustment strategy are these schools​ using?

Segmented pricing

Which of the following statements is true regarding marketing channels and channel​ intermediaries?

Using marketing channel intermediaries means producers give up some control over how and to whom they sell their products.

​Competitors' reactions to a price change flow from a set reaction policy or​ ________.

a fresh analysis of each situation

Companies apply a variety of price adjustment strategies to account for differences in​ ___________________.

consumer segments and situations

Channel members perform​ _____________________.

contact​ work, matching​ work, and negotiations

To ensure channel​ success, all channel firms should understand and accept their​ roles, _________________.

coordinate their goals and activities and cooperate to attain overall channel goals

Setting the base price for a product is only the start. The company must then adjust the price to account for​ ____________________________ differences.

customer and situational

Companies facing or anticipating a​ competitor's price change may take one or more​ actions, which include sitting​ tight, reducing their own​ price, raising perceived​ quality, _______________________________.

improving quality and raising​ prices, or launching a fighting brand

Economic conditions can have a major impact on pricing decisions. Marketers have responded by​ _________.

increasing their emphasis on​ value-for-the-money pricing strategies

Pricing strategies usually change as a product passes through its life cycle but are especially challenging during the​ _______ stage.

introductory

When a company sets a high price as the initial price of a new​ product, it is pursuing a​ ________ new product pricing​ strategy.

market-skimming

Internal factors that affect pricing include​ ________.

the​ company's overall marketing​ strategy, objectives, marketing​ mix, and other organizational considerations.

A​ ________ consists of​ producers, wholesalers, and retailers acting as a unified system.

vertical marketing system

A company has set a low price on a new product it introduced. It wants to maximize its market share and attract a large number of buyers quickly. Which new product pricing strategy should the company​ use?

​Market-penetration pricing

Printer companies often charge a fairly low price for their ink jet printers​ (relative to​ costs) and a high price for replacement cartridges. These companies are using a strategy of​ ________ pricing.

​captive-product

Product costs set the floor for a​ product's price. If the company prices the product below its​ costs, the​ company's profits will suffer. In setting its price between these two​ extremes, the company must consider several external and internal​ factors, including​ ________.

​competitors' strategies and​ prices, the overall marketing strategy and​ mix, and the nature of the market and demand

New retail forms continue to emerge to meet new situations and consumer​ needs, but the life cycle of​ ____________________________ is getting shorter.

new retail forms