Last marketing exam

source

A person, group, or organization with a meaning it tries to share with a receiver or an audience

Communication

A sharing of meaning through the transmission of information

viral marketing

A strategy to get consumers to share a marketer's message, often through e-mail or online videos, in a way that spreads dramatically and quickly

The supply chain imcludes

All entities that facilitate product distribution

noise

Anything that reduces a communication's clarity and accuracy

Fairmont Austin drops the price of a suite from $264 to $234 per night and experiences a reduction in quantity of rooms demanded of an average of five per night. This is an indication that suites at this hotel are apparently an example of a(n)_______ product

Prestige

Feedback

The receiver's response to a message

supply chain

all organizations, processes, and activities involved in the flow of goods from the raw materials to the final consumer

Price fixing

an agreement among firms to charge one price for the same good

Place utility

making products available where customers want them

noncumulative discounts

one-time price reductions based on the number of units purchased, the dollar value of the order, or the product mix purchased

freight forwarders

organizations that consolidate shipments from several firms into efficient lot sizes

advertising

paid non personal communication about an organization and its products transmitted to a target audience through mass media

word-of-mouth communication

personal informal exchanges of communication that customers share with one another about products, brands, and companies

average total cost

the sum of the average fixed cost and the average variable cost

What equation shows organizations the relationship between price and profit?

(Price × Quantity Sold) − Total Costs = Profits

Selective distribution

- is appropriate for shopping products - is desirable when a special effort, such as customer service from a channel member, is important to customers - is often used to motivate retailers to provide adequate service

intensive distribution is appropriate for products that

-Have a high replacement rate -Require almost no service -Are bought based on price cues

If a company increased its price from $100 to $120 and the percentage change in quantity demanded was 40 percent, the price elasticity of demand for this product is

????

Electronic Data Interchange (EDI)

A computerized means of integrating order processing with production, inventory, accounting, and transportation

Vertical management system

A marketing channel managed by a single channel member to achieve efficient, low-cost distribution aimed at satisfying target market customers

predatory pricing

Also called undercutting, involves the intent to set a product's price so low that rival firms cannot compete and therefore withdraw from the marketplace

strategic channel alliance

An agreement whereby the products of one organization are distributed through the marketing channels of another

manufacturers agent

An independent businessperson who sells complementary products and is compensated by commissions

Just-in-time (JIT)

An inventory-management approach in which supplies arrive just when needed for production or resale

Under armor maintains a good deal of control over how it's products are promoted, displayed, and sold. Because of this control, under armor would be appropriately described as the channel

Captain

Contractual VMS

Channel members are linked by legal agreements spelling out each member's rights and obligations

tactile communication

Communicating through touching

Recycling

Concerting waste into reusable material, reprocessing, reclaiming, or reusing supplies and final products

Firestone allows companies like Sears and Discount Tire to distribute and discount its tires. This action significantly increases the possibility of channel ____ with independent Firestone dealers.

Conflict

Quantity discounts

Deductions from the list price for purchasing in large quantities

Digital Distribution

Delivering content through the Internet to a computer or other device

Inventory Management

Developing and maintaining adequate assortments of products to meet customers' needs

channel cooperation

Enables retailers, wholesalers, suppliers and logistics providers to: Speed up inventory replenishment Improve customer service Cut the costs of bringing products to customers

Third-party logistics (3PL)

Firms that have special expertise in core physical distribution activities such as warehousing, transportation, inventory management, and information technology and can often perform these activities more efficiently

Time Utility

Having products available when the consumer wants them

procurement

Involves the processes to obtain resources to create value through sourcing, purchasing, and recycling, including materials and information

price war

Involves two or more companies engaging in intense price competition, often in an effort to boost market share

Operations Management

Managing activities from production to final delivery through system-wide coordination

marketing intermediaries

Middlemen that link producers to other intermediaries or ultimate consumers through contractual arrangements or through the purchase and resale of products

Huy Fong foods markets a sriracha sauce for household use to supermarkets through grocery wholesalers. It markets sriracha for institutional use through industrial distributors and food brokers. Huy fong is using

Multichannel distribution

personal selling

Paid personal communication that attempts to inform customers and persuade them to buy products in an exchange situation

materials handling

Physical handling of tangible goods, supplies, and resources

Logistics management

Planning, implementing, and controlling the efficient and effective flow and storage of products and information from the point of origin to consumption to meet customers' needs and wants

Sonya is a product manager for the container store, a retailer of storage containers, closet systems, and more. Sales have been declining in the past nine months and her management team is pressuring her to compete based on price discounts. However, Sonya is aware of the dangers associated with engaging in price competition. She knows that competitors can also change prices quickly and aggressively, which can result in a(n)________ that will be harmful to both companies

Price war

Large retailers such as Macy's and Walmart are most likely to participate in which of the following channels?

Producers, retailers, consumers

pull policy

Promoting a product directly to consumers to develop strong consumer demand that pulls products through the marketing channel

push policy

Promoting a product only to the next institution down the marketing channel

The supply chain begins with ___________ and ends with _____________

Raw materials; customers

Channel power

The ability of one channel member to influence another member's goal achievement

marginal revenue

The change in total revenue resulting from the sale of an additional unit of a product

Promotion Mix

The combination of promotional tools an organization uses.

channel captain

The dominant leader of a marketing channel or a supply channel

Receiver

The individual, group, or organization that decodes a coded message

Reorder point

The inventory level that signals the need to place a new order

At the breakeven point,

The money a company brings in from selling products equals the amount spent producing the products

Sourcing

The process of determining what materials a firm needs, where those materials come from, and how they impact marketing integrity

Product placement

The strategic location of products or product promotions within entertainment media content to reach the product's target market

Total cost

The sum of average fixed and average variable costs times the quantity produced

multichannel distribution

The use of a variety of marketing channels to ensure maximum distribution

Deceptive pricing

The use of false or misleading statements or practices to persuade buyers that a product is a better deal than it really is

Price

The value paid for a product in a marketing exchange

Extensive Distribution

Using a dingle outlet in a fairly large geographic area to distribute a product

Radio Frequency Identification (RFID)

Using radio waves to identify and track materials tagged with special microchips

Public Relations

a broad set of communication efforts used to create and maintain favorable relationships between an organization and its stakeholders

If demand is elastic

a change in price causes an opposite change in total revenue

External reference price

a comparison price provided by others

Allowance

a concession in price to achieve a desired goal

One advantage of nonprice competition is that

a firm can build customer loyalty

Demand curve

a graph of the quantity of products expected to be sold at various prices if other factors remain constant

marketing channel

a group of individuals and organizations that direct the flow of products from producers to customers within the supply chain

Price elasticity of demand

a measure of the sensitivity of demand to changes in price

internal reference price

a price developed in the buyer's mind through experience with the product

FOB destination

a price indicating the producer is absorbing shipping costs

Cash discount

a price reduction given to buyers for prompt payment or cash payment

Seasonal discount

a price reduction given to buyers for purchasing goods or services out of season

trade discount

a reduction off the list price a producer gives to an intermediary for performing certain functions

exclusive dealing

a situation in which a manufacturer forbids an intermediary from carrying products of competing manufacturers

freight absorption pricing

absorption of all or part of actual freight costs by the seller

Promotion Mix Elements

advertising, sales promotion, personal selling, public relations

tying agreement

an agreement in which a supplier furnishes a product to a channel member with the stipulation that the channel member must purchase other products as well

buzz marketing

an attempt to incite publicity and public excitement surrounding a product through a creative event

industrial distributor

an independent business organization that takes title to industrial products and carries inventories

Cost plus investment

calculated as full cost plus, the cost of a portion of the selling unit's assets used for internal needs

market-based cost

calculated at the market price less a small discount to reflect the lack of sales effort and other expenses

standard full cost

calculated based on what it would cost to produce the goods at full plant capacity

Actual full cost

calculated by dividing all fixed and variable expenses for a period into the number of units produced

Administered VMS

channel members are independent, but informal coordination achieves a high level of inter-organizational management

Uniform geographic pricing

charging all customers the same price, regardless of geographic location

Corporate VMS

combines all stages of the marketing channel, from producers to consumers, under a single owner

horizontal channel integration

combining organizations at the same level of operation under one management

vertical channel integration

combining two or more stages of the marketing channel under one management

proxemic communication

communicating by varying the physical distance in face-to-face interactions

kinetic communication

communicating through the movement of head, eyes, arms, hands, legs, or torso

promotion

communication to build and maintain relationships by informing and persuading one or more audiences

Value consciousness

concerned about price and quality of a product

Coding process

converting meaning into a series of signs or symbols

decoding process

converting signs or symbols into concepts and ideas

Integrated Marketing Communications

coordination of promotion and other marketing efforts for maximum informational and persuasive impact

Fixed costs

costs that do not vary with changes in the number of units produced or sold

Variable costs

costs that vary directly with changes in the number of units produced or sold

Possession Utility

customer has access to the product to use or to store for future use

primary demand

demand for a product category rather than for a specific brand

Selective demand

demand for a specific brand

For most firms in the United States, demand curves are

downward sloping

Prestige consciousness

drawn to products that signify prominence and status

nonprice competition

emphasizing factors other than price to distinguish a product from competing brands

price competition

emphasizing price as an issue and matching or beating competitors' prices

price discrimination

employing price differentials that injure competition by giving one or more buyers a competitive advantage

In the _______, concepts and ideas are converted into signs or symbols by the source

encoding process

If children and teenagers are insisting on wearing expensive name-brand apparel, a criticism of promotion can be made that promotion

encourages materialism

Form Utility

formed by assembling, preparing, or otherwise refining the product to suit customer needs

Megacarriers

freight transportation firms that provide several modes of shipment

base-point pricing

geographic pricing that combines factory price and freight charges from the base point nearest the buyer

Bowflex uses infommercials to demonstrate its fitness products and encourage customers to call and receive a free video with more information about its products. This promotional effort is directed at

identifying prospects

Aaron Whitley's company buys machine tools from large producers and sells them to several Midwestern manufacturing companies. The company Aaron works for carries inventories of the tools, which reduces capital requirements for the producers. Aaron's company is an example of a(n) ____ in a distribution channel.

industrial distributor

Convenience products typically use

intensive distribution

levels of market coverage

intensive, selective, exclusive

Distribution centers

large, centralized warehouses that focus on moving rather than storing goods

Michael is planning a promotional program for AirFam. AirFam is a supplier of new energy-saving engines used to produce air conditioners. His company needs to promote these engines to manufacturers of air conditioners, so he is most likely to use ___, because it provides immediate feedback. The disadvantage is that it is _____ than advertising to reach one customer.

personal selling; more costly

Louis is reading the online report of the tuition and fees he owes for this semester of college. Since he has signed up for online banking, he pays the amount immediately. The amount Louis just paid is considered to be

price

a measure of the sensitivity of demand to changes in price

price elasticity of demand

zone pricing

pricing based on transportation costs within major geographic zones

In episodes of American Idol, the judges drink out of cups featuring the Coca Cola logo. The promotion strategy being used by Coca Cola

product placement

In many television shows and movies, you will see characters using Apple computers and laptops during the show. This promotion strategy is called _________.

product placement

new introductory promotion

promotion that informs consumers about a new product

cumulative discounts

quantity discounts aggregated over a stated time period

Promotional efforts designed to allow a manufacturer of a seasonal product to operate at peak efficiency year round seek to

reduce sales fluctuations

geographic pricing

reductions for transportation and other costs related to the physical distance between buyer and seller

When a soft drink manufacturer offers digital coupons that customers can use in retail stores, it is using

sales promotion

When Lean Cuisine promotes the quality, taste, and calorie contents of its line of frozen meals, it is attempting to develop

selective demand

Stockouts

shortages of products

Starbucks has an agreement with Pepsi Co. through which Pepsi distributes Starbucks' coffee drink, Frappucino, to grocery stores and other retail outlets. This is an example of

strategic channel alliance

Price consciousness

striving to pay low prices

Purchasing

the act of negotiating and executing transactions to buy and sell goods, materials, and services

order lead time

the average time lapse between placing the order and receiving it

Mary is currently working on updating her company's website, incorporating signs and symbols that will help represent the ideas that the company is trying to express. Mary is most likely working on the _____ for the website.

the coding process

Outsourcing

the contracting of physical distribution tasks to third parties

Supply Chain Management (SCM)

the coordination of all the activities involved with the flow and transformation of supplies, products, and information throughout the supply chain to the ultimate consumer

Warehousing

the design and operation of facilities for storing and moving goods

marginal cost

the extra cost incurred when a business produces one additional unit of a product

Average fixed costs

the fixed cost per unit produced

channel capacity

the limit on the volume of information a communication channel can handle effectively

Communications channel

the medium of transmission that carries the coded message from the source to the receiver

Intensity of Market Coverage

the number and kinds of outlets in which a product will be sold

breakeven point

the point at which the costs of producing a product equal the revenue made from selling the product

FOB factory

the price of merchandise at the factory before shipment

Usage rate

the rate at which a product's inventory is used or sold during a specific time period

order processing

the receipt and transmission of sales order information

Cycle time

the time needed to complete a process

Barter

the trading of products

average variable cost

the variable cost per unit of output

Channel decisions are important to marketers mostly because

they involve long-term commitments and affect customer accessibility.

If demand is inelastic

total revenue changes in the same direction as the change in price

intermodal transportation

two or more transportation modes used in combination

intensive distribution

using all available outlets to distribute a product

selective distribution

using only some available outlets in an area to distribute a product

Marginal analysis involves examining

what happens to a firm's costs and revenues when production is changed by one unit.

Advertising Disadvantages

•Absolute dollar outlay can be high •Rarely provides rapid feedback •Often difficult to measure its effect on sales •Less persuasive than personal selling •Has a limited time exposure

Advantages of using industrial distributors

•Can perform the needed selling activities in local markets at a relatively low cost to a manufacturer •Can reduce a producer's financial burden by providing customers with credit services •Are aware of local needs and can pass on market information to producers due to their close relationships with their customers •Reduce producers' capital requirements by holding adequate inventories in local markets

Advertising Advantages

•Is extremely cost-efficient when it reaches a vast number of people at a low cost per person •Lets the source repeat the message several times •Visibility gained from advertising can enhance an organization's image

disadvantages of using industrial distributors

•May be difficult to manage because they are independent firms •Often stock competing brands, so a producer cannot depend on them to sell its brand aggressively •Incur expenses from maintaining inventories •Are less likely to handle bulky or slow-selling items, or items that need specialized facilities or extraordinary selling efforts •May lack the specialized knowledge necessary to sell and service technical products

Variables that affect the intensity of market coverage

•Replacement rate •Product adjustment (services) •Duration of consumption •Time required to find the product

Disadvantages of using manufacturers agents

•The seller has little control over the actions of manufacturers' agents •Prefer to concentrate on larger accounts due to the fact they work on commission •Are often reluctant to spend time following up with customers after the sale, putting forth special selling efforts, or providing sellers with market information because they are not compensated for these activities and they reduce the amount of productive selling time •Have a limited ability to provide customers with parts or repair services quickly because they rarely maintain inventories

Advantages of using manufacturers agents

•Usually possess considerable technical and market information and have an established set of customers •Can be an asset to an organizational seller with highly seasonal demand because the seller does not have to support a year-round sales force •Are typically paid on a commission basis, which can be an economical alternative for a firm that has highly limited resources and cannot afford a full-time sales force