Marketing 3250 Exam #2
If the mass-produced guitar sells 100,000 units annually at $175 per guitar, what is the total revenue?
17,500,000
Washburn's fixed costs for producing mass-produced guitars are $500,000. Its variable costs are $150 per guitar. If it prices these guitars at $250, what is the break-even quantity for this line?
5,000 guitars
How many steps are in the new-product development process?
7
A marketing manager uses price lining when he ______. A. sells several groups of the same type of product, with each group priced at different specific pricing points B. deliberately sells products below its customary price to attract attention to it C. finds it impossible to estimate demand for each product, and therefore marks each up the same way D. markets two or more products in a single package price
A
Pricing objectives involves specifying the role of price in what two areas of an organization? (two) A. its strategic plan B. its marketing plan C. its mission statement D. its organizational culture
A, B
The new-product process stage of development (stage 5) involves which two items? A. ensuring the product meets the standards established by the protocol B. exposing actual products to prospective consumers under realistic purchase conditions C. making a prototype of the product D. specifying the marketing strategy needed to bring a new product to market
A, C
What are two general methods for quoting prices related to transportation costs? A. uniform delivered pricing B. functional pricing C. FOB origin pricing D. everyday low pricing
A, C
A convenience product is one that the consumer A. only buys when it is convenient for the consumer to do so B. buys frequently and with little effort C. does not know about or particularly want D. will compare several alternatives before buying
B
How does a skimming pricing strategy approach price setting? A. different prices are charged in an effort to match demand and supply B. prices are set high initially and then lowered in a series of steps C. a fixed percentage is added to the cost of all items in a product class D. prices are set low initially then rise gradually
B
The demand curve is ______. A. a way to calculate break-even point B. a graph relating quantity sold and price C. a marketing concept that recommends promotional strategies D. a graph of the relationship between demand and supply
B
Which two strategies can be used as part of a firm's profit objectives? A. competitive parity B. target return C. maximizing current profits D. unit volume
B, C
A marketing manager considers pricing objectives and constraints to ______. A. estimate the changes to demand that will occur with a price increase B. determine what kinds of special adjustments to the list price will work best C. narrow the range of choices among the variety of pricing strategies D. reduce dependence on product revenues
C
The new-product process stage of screening and evaluation involves A. exposing actual products to prospective consumers under realistic purchase conditions B. specifying the features of the product and the marketing strategy needed to bring it to market C. determining which ideas should be eliminated from further effort D. analyzing the entire sequence of steps that make up a proposed service
C
What occurs during the commercialization stage of the new-product development process? A. testing customers using realistic purchase conditions to see if they will buy a new product B. finding industrial and government buyers for a new product C. launching full-scale production for a new product D. ensuring a new product meets the standards established by the protocol
C
Which two are profit-oriented approaches to setting a price? A. customary pricing B. cost-plus pricing C. target return pricing D. skimming pricing E. target profit pricing
C, E
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
If Washburn Guitars were to lower the price of the Maya Pro DD75 to $2,499 from $2,699, sales of the guitar would increase 30 percent. This illustrates
a product with elastic demand
The diffusion of innovation refers to the rate at which consumers ______ a given product or service.
adopt
A one-price policy means there is one price for ______.
all buyers of the product
Product modification consists of altering the product's quality, performance, or ______.
appearance
Demand-oriented, cost-oriented, profit-oriented, and competition-oriented are four approaches used to set ______.
approximate price levels
Break-even analysis analyzes the relationship between total revenue and total cost to determine profitability ______.
at various levels of output
Small changes in price can have comparably ______ effects on company profit.
big
A product manager is sometimes called a(n) _______ manager.
brand
The first step in developing ________ for the Coffee Collective would be to develop positive brand awareness and an association of the brand in consumers' minds to give the brand an identity.
brand equity
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, ________ is very important because it is a means of differentiation and helps to convey an image of quality.
branding
When an organization uses a name, phrase, design, symbols, or a combination of these to identify products and distinguish them from its competitors it is engaged in ______.
branding
Considering whether a new product will require new machinery to produce, has the potential to cannibalize existing products, or if it will require new patents occurs during which stage of the new-product development process?
business analysis
The new GoPro Hero5 Session offers 4K video, one-button simplicity, and voice control all in a small, waterproof design at the attractively low price of $299.99, which is $100 lower than the Hero5 Black's price. If the majority of the Session's sales were from consumers who would have purchased the more expensive Hero5 Black, we can say that the new Session _______ the sales of the Black.
cannibalized
Efforts to influence consumer demand for a service with changes in marketing mix elements is known as __________ management.
capacity
The integration of the marketing mix with efforts to influence consumer demand is known as ______.
capacity marketing
Product ________ refers to the entire product category or industry, often illustrated in a product life cycle curve.
class
________ is the new-product development phase resulting after Hope Springs decided that the flavor additive had enough market interest and launched full-scale production and sales.
commercialization
________ is the stage of the new-product process that positions and launches a new product in full-scale production and sales.
commercialization
________-oriented approaches to pricing set the price to reflect the way the marketer wants consumers to interpret prices relative to competitor's offerings.
competition
A pricing constraint firms face is the price that its _________ are currently charging and likely to charge in the future.
competitors
Factors that limit the range of prices a firm may set are known as pricing ______.
constraints
The demand for a product class, a product, or a brand, or the newness of a product can act as pricing ________ to limit a firm's options.
constraints
________ products are purchased by the ultimate consumer, whereas ________ products are purchased by organizations to assist them in providing other products for sale.
consumer; business
What type of consumer product is characterized by relatively inexpensive items with widespread availability?
convenience
Pricing approaches that consider the production and marketing costs and then add enough to cover direct expenses, overhead, and profit are ______ approaches.
cost-oriented
The number of silver sticks ordered for the Moisture Plus product is much lower than the number of yellow tubes ordered for the original Carmex product. With a lower purchase volume, Carmex does not receive a significant discount on the silver tubes from its suppliers. Carmex managers will use a ________ pricing approach to incorporate the price of the packaging into Moisture Plus' final price.
cost-oriented
Traditionally, nut butters have been packaged in large cylindrical screw-top jars. Justin's also offers its nut butters in single-serving squeeze packs which helps consumers see nut butter as a high protein on-the-go snack instead of a sandwich component. Modifying the package to position nut butter as an on-the-go snack is an example of
creating a new use situation
Using ________, GoPro encourages its millions of customers to submit their best content to the GoPro website to earn rewards and recognition. The resulting user-generated content is often a source of new product ideas in the idea generation stage of the new-product development process.
crowdsourcing
A service provider can better understand the entire sequence of steps in a service process by conducting a(n) ________ audit, making a flowchart of the interaction points for consumers and itself.
customer contact
Often, products enter the ________ stage of the product life cycle not due to any error in strategy but because of environmental changes.
decline
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.
decline
The LA Galaxy soccer match is best classified as a service that is
delivered by people
___________ -oriented approaches to pricing regard expected customer tastes and preferences as the most important factors in the decision.
demand
Much more than when marketing products, service providers such as seaside hotels and restaurants have a dilemma of matching ______.
demand and capacity
The chart that shows how many units of a product or service consumers will demand during a specific period of time at different prices is known as the ______.
demand curve
The relationship between price and quantity sold is called the ______.
demand curve
Common approaches to pricing are oriented around which four elements?
demand, cost, competition, profit
________ is the stage of the new-product process in which an idea is turned into a prototype.
development
Three special adjustments that are often made to the list or quoted price.
discounts, allowances, geographical adjustments
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
Because service providers vary in their delivery of a service, consumers have difficulty ______.
evaluating services
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
Product ________ pertains to variations within the product class, where each may have its own product life cycle curve.
form
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
Justin's Maple Almond Butter + Pretzels is sold in a single-serving molded plastic package designed to keep the almond butter and pretzels fresh. Additionally, the packaging is designed in a way such that pretzels can be easily and neatly dipped into the almond butter during consumption. This is an example of the ______ of packaging.
functional benefit
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
________ are made by manufacturers to list prices to reflect the cost of transportation of the products from seller to buyer.
geographical adjustments
A(n) ________ is a type of product that has tangible attributes that a consumer's five senses can perceive
good
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
In the ______ stage of the product life cycle, demand and sales increase, profits peak, and there are more competitors.
growth
The natural and organic confectionary product category is currently in the ________ stage of the product life cycle as evidenced by increasing rate of sales growth, broadened distribution, and a proliferation of organic peanut butter cup flavors.
growth
Prestige pricing means the organization deliberately prices a product ________ so that ________ consumers will be attracted to the product and buy it.
high; quality-conscious
The use of open innovation can be useful in the ________ stage of the new-product process because it helps organizations find and execute product concepts externally and overcome the associated not-invented-here barriers.
idea generation
When Hope Springs Water Co. was looking to complete the ________ phase, the company could have leveraged internal research, requested customer input, conducted a competitive analysis, or sought collaboration with another organization.
idea generation
________ is the stage of the new-product process that results in a pool of concepts to serve as candidates for new products.
idea generation
Assume that the pricing manager discovered that more seats went unsold for Tuesday night games than for any other night of the week, indicating a lower demand for soccer tickets on Tuesdays. The LA Galaxy could lower the ticket price for future Tuesday night games to avoid
idle production capacity
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
According to the price equation, the actual price is the list price less _____, plus extra fees.
incentives and allowances
With the typical downward-sloping demand curve like the one shown for Washburn, as price per unit falls, demand______
increases
The LA Galaxy understands the importance of attracting big-name soccer stars like Beckham, Keane, and Donovan to the team. For the consumer, the value of the game is created by players on the field. In other words, the creators of the service (the players) and the service itself (the game) are one in the same. This is an example of the ________ of services.
inseparability
________ means that the Coffee Collective's customers cannot easily distinguish the service provider, such as Martha and her employees, from the service itself, such as purchasing and drinking the fresh-brewed coffee.
inseparability
Because the Coffee Collective is a service organization, what it provides tends to be more of a performance than a product. Because of this, Martha must demonstrate to customers the benefits of visiting the Coffee Collective in order to overcome the ________ of services.
intangibility
Consumers cannot hold, touch, or see an LA Galaxy soccer game before the purchase decision (the decision to purchase a ticket). The fact that the consumers cannot hold, touch, or see what they are purchasing before they commit to the purchase exemplifies the ________ of services.
intangibility
If Xui Li used a(n) ________ approach to screening and evaluation, she would have employees evaluate the technical feasibility of selling the additive in addition to its bottled water products.
internal
The idea that a service organization must focus on its employees before successful programs can be directed at customers is known as ______.
internal marketing
When the LA Galaxy played soccer in a stadium that seated 80,000-90,000 fans, many of the available tickets to each game went unsold and the stadium looked empty. With the larger stadium, the Galaxy had an issue with idle production capacity, an example of which of the 4 I's of services?
inventory
A product ________ is a specific product that has a unique brand, size, or price.
item
For ordering and inventory purposes, each product _____ has a separate stock keeping unit (SKU)
item
A ________ identifies the product or brand, the package contents, and other information like where the product was made, when, and by whom.
label
The categories of continuous innovation, dynamically continuous innovation, and discontinuous innovation are based on levels of consumer ______.
learning
A demand curve is derived by measuring how many units of a product are sold at various ______.
levels of price
If a firm prices its products relatively low compared to the cost to develop, with the prospect of gaining a high market share, it is utilizing which profit-oriented pricing objective? managing for
long-run profits
Many Japanese car firms are willing to give up immediate profits for long-term penetration of the market. This is a pricing objective known as managing for ______.
long-run profits
A high-low retailer like Walgreens might temporarily cut the price of Carmex tubes to $0.49, well below its customary price, to attract attention to the product and customers to the store. This temporary price reduction is an example of
loss-leader pricing
In penetration pricing, the initial price of the product is set ______.
low, to appeal to the mass market
The shape of the product life cycle for the natural and organic confectionary product category indicates a short introductory stage, relatively quick growth stage, and a projected lengthy maturity stage. Given this information, Justin's knows it must lock in distribution quickly since competitors will likely be following quickly. What type of products are natural and organic confectionaries?
low-learning
GoPro employees are encouraged to participate in the "Live It, Eat It, Love It" program in which they pursue their passions outside of the office and record their experiences on GoPro products prior to commercial launch. The employee experiences provide GoPro with valuable feedback in the ________ stage of the new-product development process.
market testing
In the ________ stage of the product life cycle, most consumers who would buy the product are either repeat purchaser of the item or have tried and abandoned it, making it more challenging to acquire new customers.
maturity
The _________ stage of the product life cycle is characterized by a slowing of growth in total industry sales or product class revenue.
maturity
On a demand curve, one of the axes represents the price of a product while the other represents the ______.
max units sold
Current profit ________ and target ________ are two strategies used by firms that are pursuing a profit pricing objective.
maximization; marketing
During the introduction stage, total industry profit is ______.
minimal
Product bundling is one approach that may be used in a product ________ strategy to increase a product's value to customers.
modification
With ________ branding, a company uses one name for all its products in a product class.
multiproduct
If Martha decides to use a ________ strategy to grow the Coffee Collective, she would distribute a series of Coffee Collective branded teas and coffees through the local supermarket.
multiproduct branding
Justin's products include Justin's Almond Butter, Justin Milk Chocolate Peanut Butter Cups, Justin's Cashew Butter, and Justin's Maple Almond Butter + Pretzel snack packs, among others. From a branding perspective, Justin is utilizing a
multiproduct branding strategy
In which stage of the new-product process does an organization use a SWOT analysis and develop a product protocol?
new product strategy development
Well before the introduction of its Karma Drone, GoPro conducted a thorough environmental scan and discovered a substantial increase in the number of consumers engaging in aerial drone photography. This discovery occurred in which stage of the new-product development process?
new product strategy development
In the ________ stage of the new-product process an organization defines the role of a new product in terms of the firm's overall objectives.
new-product strategy development
Pricing ________ involve specifying the role of price in an organization's marketing and strategic plans.
objectives
Pricing ________ frequently reflect corporate goals, while pricing ________ often relate to conditions existing in the marketplace.
objectives; constraints
In ________ pricing, an organization sets a price a few dollars or cents under an even number, such as at $3.99.
odd-even
Sears offers a Craftsman radial saw for $499.99 rather than $500, using a(n) ________ pricing approach.
odd-even
Because consumers respond more favorably to Carmex when priced at $0.99 versus $1.00, many Carmex product prices end with a 9. This demand-oriented approach is known as
odd-even pricing
Setting a price with no variation for product buyers is called a ________ policy.
one-price
Cost-oriented approaches to pricing considers which three things in the setting of a product's price?
overhead, production costs, profit
________ can create customer value by offering communication, functional, and perceptual benefits.
packaging
________ pricing is seen as the exact opposite of skimming pricing when introducing a new product.
penetration
Most new Carmex products are priced between $0.99 and $2.99, well within reach of the price-sensitive mass consumer market. Carmex is utilizing a ________ strategy with its lip balm products.
penetration-pricing
When Harley-Davidson advertises to reinforce the perception that the brand is masculine, rugged, and individualistic, it is building brand ______.
personality
Marketers who use ______ to signal the quality of an item, must be careful not to drop the price of the product below the point where customers become skeptical of its quality and refuse to purchase it.
prestige pricing
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
If a firm sells the same product to different buyers at different prices, it may be considered ________.
price discrimination
The percentage change in quantity demanded relative to a percentage change in price is known as ______.
price elasticity of demand
When a line of products is priced at a number of different specific pricing points, the ______ strategy is being used.
price lining
A firm must know its competitors' ________ in order to best set its own.
prices
If Martha leveraged a ________ strategy to grow her overall business, she might develop a line of imported flavored teas and sell them at the local College Town Food Cooperative using the College Town name for the new product line.
private branding
The different stages a product goes through during its existence is known as the ______.
product life cycle
When P&G added vitamins to its Pantene shampoo and conditioner formulas, it used _________ to revamp the brand.
product modification
When Lexmark sells a laser printer for slightly below its cost, but prices its ink-jet printers with a large profit margin that makes up for the loss on the laser printers, it is using ______.
product-line pricing
When a manufacturer produces several products that are substitutes for one another and others that complement these products, it should use ______.
product-line pricing
By focusing on target profit pricing or target return pricing, a firm is using a ________ pricing approach.
profit-orientated
A price reduction offered to channel members for featuring the manufacturer's product in their advertising or selling activities is called a(n) _______ allowance.
promotional
When a manufacturer offers a grocery retailer an extra amount of free product for including this product in weekly advertising and in-store sales, this is considered a ________ allowance.
promotional
A ________ is a pre-development statement that identifies a target market, customer needs, and what the product will be or do.
protocol
In the development stage, GoPro engineers and designers use a 3-D printer to turn an idea into a product ________ to check the design and the aesthetics.
prototype
For nonprofit organizations, the most common form of publicity is a ______.
public service announcement
Nonprofits like public schools and hospitals often use ________ in the form of public service announcements to disseminate their messages.
publicity
Cumulative and noncumulative are the two general kinds of ______ discounts.
quantity
Price elasticity of demand is expressed as percentage change in ________ divided by the percentage change in ________.
quantity demanded; price
Customers are encouraged to buy a larger number of a single product when a firm offers _______.
quantity discounts
A demand curve enables a firm to examine prices in terms of ______.
quantity sold
The growth stage of product life cycle is characterized by more competition and a ______.
rapid increase in sales
The process of changing the place a product occupies in a consumer's mind relative to competitive products is referred to as product ______.
repositioning
Total _______ is equal to the unit price for a product times the quantity of it sold. (one word)
revenue
The decline stage for a product occurs when ______.
sales for the product drop
________ is the stage of the new-product development process that internally and externally analyzes new-product ideas to eliminate those that warrant no further effort.
screening and evaluation
The scale that defines what companies bring to the market, from good-dominant to service-dominant offerings, is known as the ________ continuum.
service
In order for the Coffee Collective to maintain ________, it will need to make sure that its coffee tastes great, the coffee shop is clean, and the staff is able to answer customers' questions.
service quality
_______ are intangible activities or benefits that an organization provides to satisfy consumers' needs in exchange for money or something else of value.
services
When a new product appeals to those segments of consumers who are willing to pay a high initial price to have an innovation first, marketers should use a ________ pricing strategy.
skimming
In what pricing strategy are prices lowered in a series of steps with the demand by those who really desire the product being satisfied at the highest prices?
skimming pricing
Discounts, allowances, and geographic adjustments are considered ________ that affect the list or quoted price.
special adjustments
When Hope Springs develops its flavored water additive and uses the college town where Gabbie and Justin are students to gauge if there is ample product interest, the company is engaged in a ________ test market.
standard
When Subway introduced a new Southwestern Club sandwich in south Florida before launching it nationwide, it was engaging in ______.
standard test marketing
Easy Off, Glass Plus, Cling Free are good brand names because they
suggest the product benefits
Carmex Moisture Plus is priced between $2.49 and $2.99, a high price compared to the $0.99 Carmex tube. Carmex managers estimated that female consumers would be willing to pay more for the sleek packaging, benefits, and additional ingredients found in the Moisture Plus line and set the price accordingly. Which demand-oriented approach is best reflected in the price of the Moisture Plus line?
target pricing
Standard, controlled and simulated are the three main kinds of ______.
test markets
Market testing involves exposing ______ product to ______.
the actual product; prospective customers
When using competition-oriented pricing approaches, price setters stress what "___ ____" is doing
the market
What is a marketer most likely trying to convey about a product if it is priced using prestige pricing?
the product is of high quality
The sum of fixed and variable costs is known as ______.
total cost
Unit price times quantity sold is ______.
total revenue
According to the profit equation, profit is ______.
total revenue minus total cost
Washburn Guitars makes signature series guitars to enhance the credibility of the Washburn brand. Creating signature series guitars would have a positive effect on all of the following except
unit variable cost
Washburn has four distinct price points for its guitar lines—entry, intermediate, professional, and collectors—based on the fact that each line has very different production costs, market demand, and sales level. Thus, Washburn has implemented a ________ pricing objective.
unit volume
Market modification strategies include finding new customers, increasing product ______, and creating new use situations.
use
Total cost represents ______.
variable costs plus fixed costs
The goal in generating new-product ideas is to ask the question ______.
what if
