marketing chapter 3
Residents living in Illinois or Missouri receive their electricity and gas for their homes and apartments from Ameren. Utility companies like Ameren are classified as _______.
monopolies
A company is considered to possess a(n) _______ when it produces a product that has no close substitutes.
monopoly
Which of the following is NOT one of the stages of the business cycle?
Decline
_______ income is a ready source of buying power and is the type of income that most marketers track or measure to determine or predict sales of their products.
Disposable
Which of the following statements is true with regard to why disposable income is important to marketers?
Disposable income is a ready source of buying power
Tamika Smith is a marketing research analyst for Walgreens based in Chicago, Illinois, and part of her job is to gather and analyze information about the product and pricing strategies of competing companies like CVS and Target as well as monitor trends regarding which products might be popular in different areas of the United States or particular neighborhoods within a state. What type of activity is Tamika engaged in for her job as a research analyst?
Environmental scanning
Environmental analysis is the process of collecting information about forces in the marketing environment.
False
Personal computers and cellular phones are technology.
False
Product competitors provide very different products that solve the same problem or satisfy the same basic customer need.
False
The Council of Better Business Bureaus and the FTC make up the National Advertising Review Board (NARB).
False
Which regulatory agency has the most influence on marketing activities?
Federal Trade Commission (FTC)
It is possible that a recession in one country can trigger economic problems in other countries.
true
Shelby's new job with the federal government provides a comfortable income and a fairly stable income. She would like to buy a new car now that she has a job; however, Shelby hesitates to purchase a new car because she is concerned about how poor economic conditions may affect her position in the future. Shelby lacks _______.
willingness to spend
If Julio Ruiz has an income of $30,000, pays $6,000 in rent, $1,200 in utilities, and $5,000 in taxes per year, his disposable income is _______.
$25,000
Which of the following best defines wealth?
Accumulation of past income, natural resources, and financial resources
Which type of competition is considered the most significant to firms and the type that receives the most study and analysis with regard to environmental scanning?
Brand
The Whole Foods Market began in 1980 with one store in Austin, Texas, and now maintains more than 480 stores across North America and the United Kingdom. According to its website, Whole Foods Market is America's Healthiest Grocery Store™ and "seeks out the finest natural and organic foods available, maintains the strictest quality standards in the industry, and has an unshakeable commitment to sustainable agriculture." However, the Whole Foods chain has been implicated in several high-profile cases involving price gouging. In 2014 Whole Foods paid an $800,000 fine in California after Santa Monica, Los Angeles, and San Diego brought a civil protection case against the chain, accusing it of overcharging customers. In 2015 the New York Department of Consumer Affairs accused Whole Foods of overcharging its customers by overstating the weight of some prepackaged products. For example, consumers buying vegetable platters priced at $20 each were overcharged an average of $2.50. In another example, eight packages of chicken tenders priced at $9.99 a pound on average cost $4.13 more than they should have. According to a report published in the New York Times, the Department of Consumer Affairs said the fine in New York for falsely labeling a package was as much as $950 for the first violation and up to $1,700 for a subsequent violation. In response to these allegations, CEO John Mackey and former co-CEO Walter Robb issued a video apology and stated they made mistakes and want to show their responsibility for these mistakes. In addition, they mentioned that they would employ a third-party auditing system to ensure they are making progress in correctly pricing products and encouraged customers to ask a store employee to check pricing and if a mistake is made, the consumer could receive the item free of charge. Refer to Scenario 3.2. The Whole Foods Market started in 1980 but has expanded over time to more than 480 stores across North America and the United Kingdom. Its mission is to be known as America's Healthiest Grocery Store by providing organic products and a commitment to sustainable agriculture. Which of the following factors most likely helped Whole Foods Market achieve success?
Changes in cultural values
Recent increases in the use of personal computers, tablets, and smartphones by children has led to increased privacy concerns especially with regard to firms collecting personal information about children. In order to provide protection to children, the federal U.S. government enacted the _______.
Children's Online Privacy Protection Act
Consumer products companies aim to create customer loyalty where consumers purchase only their product time-after-time. In some cases, this brand loyalty may be passed down within a family where children continue to purchase the brand their family used and typically is common among purchasers of laundry detergent and toothpaste. Therefore, marketers for Crest toothpaste are most concerned about competition from which of the following brands?
Colgate toothpaste
Recently Lululemon, a popular clothing brand, recalled the "Carry and Go Hoodie" as they determined that when the elastic draw cord with a hard tip in the hood or around the neck area is pulled or caught on something and released, it can snap back, impact the face area, and result in injury. This recall was most likely influenced by which of the following agencies or legislation?
Consumer Product Safety Commission
Which of the following characteristics is NOT correct regarding periods of depression?
Consumers have high total income
GameStop operates video game, consumer electronics and wireless services around the globe in more than 7,200 stores worldwide. According to its website, "GameStop is committed to delivering innovation to consumers anywhere, anytime and anyway they want it." GameStop enables its consumers to trade-in games and purchase new, pre-owned, digital or physical video game titles and offers the latest in hardware and accessories. The Chief Marketing Officer of GameStop would most likely be concerned with tracking which of the following to help forecast sales volume in the future?
Consumers' discretionary income
Which of the following statements is true with regard to credit?
Credit increases current buying power at the expense of future buying power
In its advertisements, Regent Hair Care Products claims that its KLTR-14 gel will restore the hair of bald men. Even though Regent shows supporting evidence in its ads, members of the National Advertising Review Board (NARB) believe the claim is unsupportable. What action can the NARB take?
File a complaint with the Federal Trade Commission
Scenario 3.1. The Harvest Café is a locally owned restaurant providing farm-fresh ingredients to consumers by partnering with farmers in its region. They routinely purchase organic chicken from Singley Farms who also supplies other local restaurants with chicken. Marco Suarez, head chef of the Harvest Café noticed a price increase of almost $1.00 per pound and contacted one of his friends at the Fresh Restaurant in another city to inquire about what it was paying for its chicken. Marco learned that the Fresh Restaurant orders similar quantities of chicken from Singley Farms and pays about 75 cents less per pound than the Harvest Café. Marco was very upset and concerned about this finding since it impacts his ability to fairly compete and keep his menu prices in line with other restaurants, such as the Fresh Restaurant. Marco contacted his attorney to assist him in filing a complaint with the Federal Trade Commission. Refer to Scenario 3.1. The Harvest Café promotes its restaurant as a farm-to-table eatery and lists the names of local farms such as Singley Farms on its menu. Its advertising strategy and menu listings lead consumers to believe that all menu items are locally sourced from farmers in its region. Kenisha Smith was dining at the restaurant and inquired about which farm had supplied the lamb for the lamb chop dish listed on the menu. The waiter didn't know so she asked the chef. The chef told the waiter that the lamb had been ordered from Sysco Foods and was frozen—not fresh nor locally sourced. The waiter told the customer who later filed a complaint with the Better Business Bureau (BBB). What action could the BBB take against the Harvest Café if its investigation revealed deceptive practices regarding locally sourced ingredients?
Issue a warning to consumers through a local newspaper
Recently, a small retailer in New York City was found liable for trademark infringement for importing and selling counterfeit Fendi bags. The trial court awarded Fendi more than $12 million in damages. Which law helps companies protect their trademarks—brand names, logos, and other registered symbols against infringement?
Lanham Act
The Whole Foods Market began in 1980 with one store in Austin, Texas, and now maintains more than 480 stores across North America and the United Kingdom. According to its website, Whole Foods Market is America's Healthiest Grocery Store™ and "seeks out the finest natural and organic foods available, maintains the strictest quality standards in the industry, and has an unshakeable commitment to sustainable agriculture." However, the Whole Foods chain has been implicated in several high-profile cases involving price gouging. In 2014 Whole Foods paid an $800,000 fine in California after Santa Monica, Los Angeles, and San Diego brought a civil protection case against the chain, accusing it of overcharging customers. In 2015 the New York Department of Consumer Affairs accused Whole Foods of overcharging its customers by overstating the weight of some prepackaged products. For example, consumers buying vegetable platters priced at $20 each were overcharged an average of $2.50. In another example, eight packages of chicken tenders priced at $9.99 a pound on average cost $4.13 more than they should have. According to a report published in the New York Times, the Department of Consumer Affairs said the fine in New York for falsely labeling a package was as much as $950 for the first violation and up to $1,700 for a subsequent violation. In response to these allegations, CEO John Mackey and former co-CEO Walter Robb issued a video apology and stated they made mistakes and want to show their responsibility for these mistakes. In addition, they mentioned that they would employ a third-party auditing system to ensure they are making progress in correctly pricing products and encouraged customers to ask a store employee to check pricing and if a mistake is made, the consumer could receive the item free of charge. Refer to Scenario 3.2. Which environmental force are the joint CEOs responding to in their video apology?
Legal and regulatory
Which of the following companies would be most interested in tracking consumers' levels of discretionary income?
Louis Vuitton
Which of the following is/are NOT one of the methods typically utilized when collecting information for environmental scanning?
Media advertising
Ian needs to purchase a dress shirt for an upcoming job interview. He shops at Kohl's and sees that he can choose from different brands including Apt. 9, Chaps, Arrow, Croft & Barrow and many more. The dress shirts come in a variety of colors, materials, and price points. Which type of competitor structure is illustrated?
Monopolistic competition
Jersey Mike's, Subway, Jason's Deli, and Potbelly Sandwich Shop all specialize in sandwiches to satisfy consumers' hunger at lunch and dinner. Potbelly is known for its toasted sandwiches and appeals to a more upscale customer with its attractive restaurants, "meatier" options, and higher price points. What type of competitive environment best characterizes Potbelly's approach to marketing?
Monopolistic competition
_______ exist/s when a firm with many potential competitors attempts to develop a marketing strategy to differentiate its product.
Monopolistic competition
In 2017, the Federal Trade Commission (FTC) filed a complaint in a federal district court charging baseband processor supplier, Qualcomm Inc., with using anticompetitive tactics. The FTC claims that Qualcomm forced cell phone manufacturers to agree to Qualcomm's preferred license terms—essentially forcing manufacturers to use Qualcomm's processors over competitors' processors. In addition, Qualcomm refuses to license standard-essential patents to competitors which is common when international industry bodies deem these parts essential to meet global or regional standards. If Qualcomm's business practices were ignored, what type of competitive structure could Qualcomm have achieved?
Monopoly
If you have made a purchase using your discretionary income, you likely paid for which of the following?
Movie tickets
What are the four types of competitive structures discussed in the text?
Oligopoly, pure competition, monopolistic competition, and monopoly
Over the last several years, many states have organized trade trips of small- to medium-sized businesses to Cuba to meet with Cuban political leaders as well as members of the state government. Which economic force are these trade trips designed to influence?
Political
Texas rice farmers wish to get their product into the Japanese market but are hindered by a complex maze of regulations imposed by the Japanese government. The farmers are most likely to attempt to influence which aspect of the marketing environment?
Political
Uber and Lyft spent hundreds of thousands of dollars to lobbyists to communicate to elected officials the importance of the ride sharing bill. The bill sought to allow ride sharing apps outside of New York City. Companies employing lobbyists is an attempt to influence which aspect of the marketing environment?
Political
The world economies suffered a major economic event in late 2007 that some economists referred to as a recession. Which of the following marketing strategies is recommended during a recessionary period?
Promote value and utility of products
Which stage of the business cycle is characterized by high total income and low levels of unemployment?
Prosperity
Shoppers in Chicago, Illinois, may purchase fresh produce at a variety of neighborhood farmer's markets such as the Daley Plaza Farmer's Market, known as the longest running farmer's market which is open from May through October. The various farmer's markets allow farmers to sell their produce, bakery items, cheese, and meat products directly to consumers. What type of competitive structure best characterizes the farmer's market environment?
Pure competition
The effects of technology on society can be described by several characteristics. Which of the following characteristics relates to the broad nature of technology as it moves through society?
Reach
Which stage of the business cycle is characterized by declining levels of buying power?
Recession
Holiday Computer Associates was recently fined for violating the _______ due to its practice of charging different prices to different customers without any justification.
Robinson-Patman Act
Scenario 3.1. The Harvest Café is a locally owned restaurant providing farm-fresh ingredients to consumers by partnering with farmers in its region. They routinely purchase organic chicken from Singley Farms who also supplies other local restaurants with chicken. Marco Suarez, head chef of the Harvest Café noticed a price increase of almost $1.00 per pound and contacted one of his friends at the Fresh Restaurant in another city to inquire about what it was paying for its chicken. Marco learned that the Fresh Restaurant orders similar quantities of chicken from Singley Farms and pays about 75 cents less per pound than the Harvest Café. Marco was very upset and concerned about this finding since it impacts his ability to fairly compete and keep his menu prices in line with other restaurants, such as the Fresh Restaurant. Marco contacted his attorney to assist him in filing a complaint with the Federal Trade Commission. Refer to Scenario 3.1. Assume that the Federal Trade Commission (FTC) investigates Singley Farms and determines that Singley Farms was charging Harvest Café more money per pound than Fresh Restaurant for similar quantities of chicken. Which federal law might govern the pricing decisions of Singley Farms?
Robinson-Patman Act
Dos Equis had increased its market share through its popular advertisements featuring "The Most Interesting Man in the World" and the tag line "Stay Thirsty My Friends." Dos Equis promoted its products using television and print media advertising. The print advertisements also included the statement "Enjoy Dos Equis Responsibly." The additional statement included regarding responsible drinking is an example of which type of regulatory forces affecting marketing activities?
Self-regulation
In its advertisements for Bud Light beer, Anheuser-Busch has decided to include a statement saying, "Know When to Say When." This is an example of which one of the following types of regulatory forces affecting marketing efforts?
Self-regulation
The _______ Act was passed to prevent businesses from restraining trade and monopolizing markets.
Sherman Antitrust
Recently, the federal government of the United States began investigating major airline companies such as Delta, American Airlines, and Swissair for possible price fixing allegations. If the airlines are found to be engaged in price fixing, which law could they be charged with violating?
Sherman Antitrust Act
Generic competitors are those who provide very different products that solve the same problem or satisfy the same basic consumer need. Which of the following would NOT be a generic competitor for Firehouse Subs?
Subway
In 1982, astronauts working on the lunar surface wore liquid-cooled garments under their space suits to protect them from temperatures approaching 250 F. These garments, further developed and refined by NASA's Johnson Space Center, are among the agency's most widely used spinoffs, with adaptations for portable cooling systems for treatment of medical ailments such as burning limb syndrome, multiple sclerosis, spinal injuries, and sports injuries. Which environmental force enabled the adaptations for portable cooling systems to aid medical patients?
Technological
Which environmental force is credited with transforming the U.S. economy into the most productive in the world?
Technological
McDonalds recently recognized the buying power of the Hispanic market near their Houston locations. Which one of the following efforts demonstrates how the restaurant is appealing to the Hispanic market?
The use of beloved Hispanic character, El Chapulín Colorado in teaser videos posted on McDonald's Facebook and Instagram pages
_______ competitors are those who compete for the limited financial resources of the same customers or target market group.
Total budget
A U.S. Supreme Court decision has nullified federal laws that limited corporate contributions to political campaign funds for specific candidates.
True
Changes in general economic conditions affect (and are affected by) supply and demand, buying power, willingness to spend, consumer expenditure levels, and intensity of competitive behavior.
True
Political and legal forces in the marketing environment are highly interrelated.
True
The major source of cultural values is the family.
True
Diet Coke, Diet Pepsi, and Diet RC are categorized as soft drinks made by beverage companies, which market products that are similar in features, benefits, and prices to the same customer or target market. Therefore, these companies can be classified as _______ competitors.
brand
Lay's Potato Chips, Tim's Potato Chips, Kettle Brand Krinkle Cut Potato Chips, and Clover Club Classic Potato Chips are examples of _______ competitors.
brand
Vani Hari is a popular blogger who started FoodBabe.com in 2011 to share her knowledge of healthy eating with her friends and family and encourage people to eat whole foods. Her popularity expanded and she is now an advocate and vocal opponent to companies who include dangerous ingredients in their foods, such as artificial food dyes. Her efforts, combined with an online petition, led to Kraft food removing all artificial food dyes from its macaroni and cheese products by 2016. Vani Hari's blog and her efforts to encourage change among food manufacturers such as Kraft is an example of _______.
consumerism
A group of protesters carries signs encouraging people to boycott The Farmer's Market, a small grocery store in an urban area. The protesters claim that Farmer's takes unfair advantage of elderly and minority consumers by charging them as much as 20% higher prices than other locations in the suburbs. This protest is part of what we see today as the _______.
consumerism movement
Americans today are more interested in health and fitness and retailers such as the Vitamin Shoppe and GNC are catering to consumers who want to pursue a healthy lifestyle and live a healthy, longer life. The Vitamin Shoppe and GNC are responding to changes in _______.
cultural values
Many large supermarket chains such as Hy-Vee and Albertsons have added ready-to-cook and ready-to-serve meal options as well as dine-in café's in recognition that today's busy families are eating out more often and have less time to prepare meals in their home kitchen. These grocery stores are responding to changes in _______.
cultural values
The Classic Hotel Group has begun to offer entire floors of rooms in its hotels that are smoke-free, adults-only, and pet-friendly. The Classic Hotel Group is responding to changes in _______.
cultural values
During periods of recession where unemployment levels rise and consumer buying power declines, companies often _______ their marketing expenditures.
decrease
The United States is becoming increasingly diverse and companies are hoping to capitalize on the growth in certain market segments, such as the Hispanic market. In fact, the buying power for Hispanics in the United States is approximately $1.7 trillion, which is a sizeable market. Department store retailer JCPenney is changing its marketing strategy to target the Latina population and hopes to become the department-store destination for Hispanic shoppers. They have bilingual signage in stores, are promoting the store with tie-ins to the World Cup and modifying its product offerings to appeal to this target market. JCPenney's recent efforts in becoming a destination store for the Hispanic shopper is an example of how a change in _______ can affect store strategy.
demographics
The _______ of technology involve(s) the constant change that often challenges the structures of social institutions, including social relationships, the legal system, religion, education, business, and leisure.
dynamics
Folgers Coffee relies on information from observation, secondary business and trade publication sources, and marketing research to determine consumer needs, changes in sociocultural factors which might influence coffee consumption as well as competitive threats such as the rise in coffee cafes and consumers' continued love of espresso and lattes. Thus, Folgers Coffee engages in _______ and takes an _______ approach to changes in the external environment.
environmental scanning; reactive
The Whole Foods Market began in 1980 with one store in Austin, Texas, and now maintains more than 480 stores across North America and the United Kingdom. According to its website, Whole Foods Market is America's Healthiest Grocery Store™ and "seeks out the finest natural and organic foods available, maintains the strictest quality standards in the industry, and has an unshakeable commitment to sustainable agriculture." However, the Whole Foods chain has been implicated in several high-profile cases involving price gouging. In 2014 Whole Foods paid an $800,000 fine in California after Santa Monica, Los Angeles, and San Diego brought a civil protection case against the chain, accusing it of overcharging customers. In 2015 the New York Department of Consumer Affairs accused Whole Foods of overcharging its customers by overstating the weight of some prepackaged products. For example, consumers buying vegetable platters priced at $20 each were overcharged an average of $2.50. In another example, eight packages of chicken tenders priced at $9.99 a pound on average cost $4.13 more than they should have. According to a report published in the New York Times, the Department of Consumer Affairs said the fine in New York for falsely labeling a package was as much as $950 for the first violation and up to $1,700 for a subsequent violation. In response to these allegations, CEO John Mackey and former co-CEO Walter Robb issued a video apology and stated they made mistakes and want to show their responsibility for these mistakes. In addition, they mentioned that they would employ a third-party auditing system to ensure they are making progress in correctly pricing products and encouraged customers to ask a store employee to check pricing and if a mistake is made, the consumer could receive the item free of charge. Refer to Scenario 3.2. Whole Foods Market mission to be America's Healthiest Grocery Store and provide the finest natural and organic foods available is an attempt by the company to _______
engage in self-regulatory actions
Dell conducted research to identify consumer preferences regarding laptop computers in terms of size, capabilities, storage, graphic cards, and colors. The company initiated multiple research studies and also utilized secondary data obtained through industry sources. The brand managers of Dell next engaged in the process of evaluating the information for accuracy, resolving inconsistencies in the data, and determining how the company could utilize the information. This process of assessing and interpreting the gathered information is known as _______.
environmental analysis
Frito-Lay manufactures and markets snack foods around the globe and within each geographic market area must strive to provide snack products that meet the needs of its customers. Over the years, Frito-Lay has been very innovative in developing new products or modifying existing products and engages in extensive marketing research to test various flavors and snack food combinations. Frito Lay generally utilizes focus group research to test consumer responses to new products and based on the results will engage in more extensive marketing research such as field testing or test marketing. Recently, Frito Lay launched a new Doritos chip Blaze in early 2018 across the United States. Frito-Lay's use of marketing research to identify consumers eating more spicy foods than they have in the past and the potential for success is an example of _______ while the collection of the marketing research information is an example of _______.
environmental analysis; environmental scanning
The major automobile brands such as Ford, Toyota, GM, and Honda are interested in consumers' interest in "smart" technology in new automobiles. GM recently studied consumers' interest in buying self-driving vehicles. The automobile brands must stay abreast of changing technology as well as consumer trends regarding the use of technology. The automobile company's collection of this type of information is referred to as _______.
environmental scanning
The process of collecting information about forces in the marketing environment using observation, secondary sources such as business, trade, government, and general-interest publications is called _______.
environmental scanning
By offering both credit and financing through its GMAC division, General Motors is trying to help consumers _______.
expand current buying power at the expense of future buying powe
Technology innovations are supported the most through funding by _______.
federal government
Dave & Buster's is a sports bar and restaurant with a large arcade. Marketers at Dave & Buster's know that people may choose to spend their Friday or Saturday night at a sporting event, movie theater, or other restaurant. As a result, Dave & Buster's sees local sports teams and Cinemark Theatres as _______ competitors.
generic
Due to limited resources, a consumer decided to serve Hawaiian Punch to a New Year's Eve party crowd instead of Korbel champagne. As a result of this action, Korbel and Hawaiian Punch can be viewed as _______ competitors.
generic
Mitch Ford was hungry and was trying to decide what to have for dinner. He thought about ordering a pizza from Domino's but decided instead to make Orville Redenbacher popcorn since he already had some in his apartment. In this case, Domino's and Orville Redenbacher popcorn are considered _______ competitors.
generic
Brandon Phillips has recently signed a contract to accept an account executive position after graduation with Impact Marketing and will receive a signing bonus of $2,000, $3,000 in relocation expenses, $48,000 in base salary, and a 15% commission on sales. The amount of money Brandon is contracted to receive from Impact Marketing is referred to as _______.
income
The Whole Foods Market began in 1980 with one store in Austin, Texas, and now maintains more than 480 stores across North America and the United Kingdom. According to its website, Whole Foods Market is America's Healthiest Grocery Store™ and "seeks out the finest natural and organic foods available, maintains the strictest quality standards in the industry, and has an unshakeable commitment to sustainable agriculture." However, the Whole Foods chain has been implicated in several high-profile cases involving price gouging. In 2014 Whole Foods paid an $800,000 fine in California after Santa Monica, Los Angeles, and San Diego brought a civil protection case against the chain, accusing it of overcharging customers. In 2015 the New York Department of Consumer Affairs accused Whole Foods of overcharging its customers by overstating the weight of some prepackaged products. For example, consumers buying vegetable platters priced at $20 each were overcharged an average of $2.50. In another example, eight packages of chicken tenders priced at $9.99 a pound on average cost $4.13 more than they should have. According to a report published in the New York Times, the Department of Consumer Affairs said the fine in New York for falsely labeling a package was as much as $950 for the first violation and up to $1,700 for a subsequent violation. In response to these allegations, CEO John Mackey and former co-CEO Walter Robb issued a video apology and stated they made mistakes and want to show their responsibility for these mistakes. In addition, they mentioned that they would employ a third-party auditing system to ensure they are making progress in correctly pricing products and encouraged customers to ask a store employee to check pricing and if a mistake is made, the consumer could receive the item free of charge. Refer to Scenario 3.2. The New York Department of Consumer Affairs is planning to contact the Federal Trade Commission (FTC) to investigate Whole Foods Market and its practices regarding inaccurate pricing of prepackaged products. If the FTC believes that the Whole Foods Market has violated a law, the FTC would first _______.
issue a cease-and-desist order
The American automobile industry was historically dominated by "The Big Three," referring to General Motors, Ford, and Chrysler. However, as many more foreign competitors began influencing this market, the American companies had to modify and differentiate their products. The automobile industry moved from a(n) _______ structure to a(n) _______ structure.
oligopolistic; monopolistic competition
Consumers living in the Midwest who wish to watch current television series, sports, and movies can subscribe to satellite TV services, such as Dish or DirecTV or purchase cable service from Xfinity. Since the television service industry is dominated by these firms, the competitive structure is known as a(n) _______.
oligopoly
The communications industry was historically dominated by "Ma Bell" or the Bell Telephone Company, which later became AT&T. Today, however, the communications industry includes AT&T as well as Verizon, Sprint, and T-Mobile, to name a few. Therefore, the communications industry is classified today as a(n) _______ compared to a(n) _______ dominated by the Bell Telephone Company.
oligopoly; monopoly
Blue Cross and Blue Shield of Illinois is a health insurance company that provides millions of members across the state of Illinois with comprehensive and affordable health plans. The Illinois-based company is a licensed affiliate of the Blue Cross Blue Shield Association (BCBSA), which operates affiliate organizations in all 50 states. The BCBSA is one of the top five organizations that pays lobbyists millions of dollars to influence state and federal legislators or senators to enact legislation, which would be favorable for their member companies. In 2014 the BCBSA spent $17 million and was actively involved in the Affordable Care Act and legislation regarding Medicare. The Blue Cross Blue Shield Association is engaging in a _______ approach to environmental forces.
proactive
Many companies have invested millions of dollars with lobbyists in efforts to influence the democratic process in ways that would be favorable for their business. For example, Caterpillar, Inc. based in Peoria, Illinois, spends millions annually with various lobbying groups to influence political action regarding corporate taxation, transportation, global trade, health, and immigration. Companies, such as Caterpillar, Inc. are responding to external environmental forces in a(n) _______ manner.
proactive
Recently, consumers have grown more concerned about the ingredients and composition of food products especially with regard to genetically modified organisms (GMO). Many consumer products companies, such as Coca-Cola, Kellogg's, PepsiCo, Hershey's, and Hormel have contributed funds to lobbyists and political organizations to oppose legislation requiring the labeling of GMO ingredients in food products. The actions of these companies in opposing legislation that could impact these companies is an example of a(n) _______ approach in response to legislative action, which is an environmental force.
proactive
While Diet Coke and Diet Pepsi are brand competitors, they must also realize that their target customers have other alternatives for quenching their thirst such as juice, water, sports drinks, coffee, or alcoholic beverages. Therefore, they face _______ competition from companies who compete in the same product class but market products with different features, benefits, and prices.
product
During _______, unemployment is low and total income is relatively high. If inflation rates are low, consumers have high levels of buying power.
prosperity
Markets that are characterized as _______ competition include a large number of sellers, none of which significantly influence price or supply and provide homogeneous products.
pure
The easiest type of competitive structure to enter would be _______ because there are no barriers to entry.
pure competition
The broad nature of technology as it moves through society is referred to as _______.
reach
Samsonite Luggage has developed a new line of luggage designed for business travelers who carry their bags and desire lighter weight luggage that complies with the airlines' guidelines regarding size and weight restrictions for airline passengers. Travelers using the new line of luggage can now carry more personal items in the luggage since the luggage itself is lighter. Samsonite is using a(n) _______ response to environmental forces.
reactive
Subway's promotion of $6-foot-long sandwiches and McDonald's promotion of the $1, $2, $3 menu are appealing to consumers who desire value and will respond to promotions related to saving money. Firms typically utilize these types of price or value-driven promotions during periods of _______.
recession
Mothers Against Drunk Driving (MADD) is a nonprofit group that advocates safe driving practices and hopes to prevent driving after consuming alcoholic beverages. The group attempts to influence those who might drink and drive through a "designated driver" campaign and efforts directed toward bar and restaurant owners/managers to encourage responsible drinking. MADD's campaign to change drinking and driving behavior represents a _______ force.
sociocultural
The Whole Foods Market began in 1980 with one store in Austin, Texas, and now maintains more than 480 stores across North America and the United Kingdom. According to its website, Whole Foods Market is America's Healthiest Grocery Store™ and "seeks out the finest natural and organic foods available, maintains the strictest quality standards in the industry, and has an unshakeable commitment to sustainable agriculture." However, the Whole Foods chain has been implicated in several high-profile cases involving price gouging. In 2014 Whole Foods paid an $800,000 fine in California after Santa Monica, Los Angeles, and San Diego brought a civil protection case against the chain, accusing it of overcharging customers. In 2015 the New York Department of Consumer Affairs accused Whole Foods of overcharging its customers by overstating the weight of some prepackaged products. For example, consumers buying vegetable platters priced at $20 each were overcharged an average of $2.50. In another example, eight packages of chicken tenders priced at $9.99 a pound on average cost $4.13 more than they should have. According to a report published in the New York Times, the Department of Consumer Affairs said the fine in New York for falsely labeling a package was as much as $950 for the first violation and up to $1,700 for a subsequent violation. In response to these allegations, CEO John Mackey and former co-CEO Walter Robb issued a video apology and stated they made mistakes and want to show their responsibility for these mistakes. In addition, they mentioned that they would employ a third-party auditing system to ensure they are making progress in correctly pricing products and encouraged customers to ask a store employee to check pricing and if a mistake is made, the consumer could receive the item free of charge. Refer to Scenario 3.2. The New York Department of Consumer Affairs is an example of a _______.
state regulatory agency
Most consumers make trade-off decisions when making their trips to the grocery store to purchase food, paper products, and health and beauty products. Thus, products such as Wonder Bread, Diet Coke, Bounty paper towels, Tide laundry detergent, and Head & Shoulders shampoo would represent _______ competitors.
total budget
The Whole Foods Market began in 1980 with one store in Austin, Texas, and now maintains more than 480 stores across North America and the United Kingdom. According to its website, Whole Foods Market is America's Healthiest Grocery Store™ and "seeks out the finest natural and organic foods available, maintains the strictest quality standards in the industry, and has an unshakeable commitment to sustainable agriculture." However, the Whole Foods chain has been implicated in several high-profile cases involving price gouging. In 2014, Whole Foods paid an $800,000 fine in California after Santa Monica, Los Angeles, and San Diego brought a civil protection case against the chain, accusing it of overcharging customers. In 2015, the New York Department of Consumer Affairs accused Whole Foods of overcharging its customers by overstating the weight of some prepackaged products. For example, consumers buying vegetable platters priced at $20 each were overcharged an average of $2.50. In another example, eight packages of chicken tenders priced at $9.99 a pound on average cost $4.13 more than they should have. According to a report published in the New York Times, the Department of Consumer Affairs said the fine in New York for falsely labeling a package was as much as $950 for the first violation and up to $1,700 for a subsequent violation. In response to these allegations, CEO John Mackey and former co-CEO Walter Robb issued a video apology and stated they made mistakes and want to show their responsibility for these mistakes. In addition, they mentioned that they would employ a third-party auditing system to ensure they are making progress in correctly pricing products and encouraged customers to ask a store employee to check pricing and if a mistake is made, the consumer could receive the item free of charge. Refer to Scenario 3.2. Walter Robb and John Mackey issued a video apology by using YouTube and its Facebook page to reach consumers who might have been impacted by the pricing inaccuracies. The increasing use of YouTube and Facebook represent a(n) _______ force.
technological
Enterprise Rent-A-Car is considering the implementation of new technology, which would enable a business traveler to bypass the automobile counter and select their rental car using their smartphone and proprietary application, which stores the customer's drivers' license number, credit card information, and customer contact information. The company is engaging in _______ to determine the viability of the adoption of the new technology and whether the benefits outweigh the costs associated with the development and product launch.
technological assessment
UPS is considering its distribution strategy for the next five years. As part of the strategy development, UPS is investigating the use of radio frequency identification, consumer payments through smartphones, Facebook, and Twitter and how it might use these to interface with its customers. UPS is most likely engaging in _______.
technology assessment