Marketing Chp 7-8 : Exam 2
An entity that promotes free trade among member nations by eliminating trade barriers and educating individuals, companies, and governments about trade rules around the world
World Trade Organization (WTO)
Malaysia and Laos are members of the same trading bloc that promotes trade and economic integration among member nations in the region. One distinguishing characteristic of this trading bloc is that it will not support fully free labor flows or a common currency. Which trading bloc is this likely to be?
The Association of Southeast Asian Nations (ASEAN)
When three buyers purchase the products of three producers, nine transactions are required. If one intermediary serves both producers and buyers, the number of possible transactions is
6
Midwestern Sealants & Coatings wants to expand into new geographic areas within the U.S. to find more customers for its sealants and industrial paints. To identify prospects, it needs to locate potential business customers by industry classification numbers, determine their locations, and develop lists of potential customers by desired geographic area and identify prospects' name, location, sales volume, number of employees, type of products handled, names of chief executives, and other pertinent information. Where would you suggest Midwestern turn?
A commercial data service such as Dun & Bradstreet
Which of the following is an example of derived demand? -A decrease in the prices of oranges has led to more orders of orange juice. -An increase in windshields has led to an increase in windshield wipers. -Sales for bathing suits jump in the summer, especially in hotter regions. -An increase in airfare prices has not had much of an effect on demand for business travelers. -An increase in coffee drinking is prompting coffee shops to order more coffee grinders.
An increase in coffee drinking is prompting coffee shops to order more coffee grinders.
Online marketplaces where buyers and sellers from around the world can exchange information, goods, services, ideas, and payments
B2B e-commerce sites
___ refers to the idea that morality varies from one culture to another and that business practices are therefore differentially defined as right or wrong by particular cultures.
Cultural relativism
demand for consumer products
Demand for business products is characterized as derived. From what is the demand derived?
Levi owns a store that sells cooking products to end consumers. He has worked with the same supplier for many years and trusts the supplier completely. Whenever Levi needs to order new inventory from his supplier, he sends them information specifying the type of product, the quantity, the color, and some general quality characteristics. Levi has been with his supplier for years and knows how thorough they are. Finding defective products is so rare that Levi doesn't even bother examining the shipment, other than to make sure the products adhere to the standards specified. Refer to Scenario 7.1. Which method of buying does Levi use?
Description
The sales department of a consumer products organization realized that its rivals are adopting new customer relationship management software to keep better track of their prospects. The director of the sales department decided it would also purchase the CRM software to keep up with its rivals. This is an example of what type of force affecting business buying behavior?
Environmental forces
Government restrictions on the amount of a particular currency that can be bought or sold
Exchange controls
The market value of a nation's total output of goods and services for a given period; an overall measure of economic standing
Gross domestic product (GDP)
Developing and performing marketing activities across national boundaries
International marketing
Stephanie works for a company that manufactures purses and is considering employing a trading company to reduce the risk of getting involved in international marketing. What is one of the benefits of using a trading company?
It facilitates all marketing aspects of a transaction.
Satisfaction for both the buyer and seller
Marketing facilitates exchange relationships between buyers and sellers. What is marketing's intended outcome for this relationship?
Namjoo is launching an online marketplace for lodging. Her investors say she should focus on local business, but she believes that a global presence generates opportunities for creating value. What is one of those opportunities?
To mine optimal locations for activities and resources
Suppose the government wants to hire a firm to build a new road. What method of business buying will it most likely use?
Negotiation
An industry classification system that generates comparable statistics among the United States, Canada, and Mexico
North American Industry Classification System (NAICS)
A janitorial service firm purchases Clorox supplies to use in cleaning places like schools and office buildings. This type of customer would be an example of what type of market for Clorox?
Producer
levi owns a store that sells cooking products to end consumers. He has worked with the same supplier for many years and trusts the supplier completely. Whenever Levi needs to order new inventory from his supplier, he sends them information specifying the type of product, the quantity, the color, and some general quality characteristics. Levi has been with his supplier for years and knows how thorough they are. Finding defective products is so rare that Levi doesn't even bother examining the shipment, other than to make sure the products adhere to the standards specified. Refer to Scenario 7.1. Levi is operating in which type of market?
Reseller
Which of the following are most likely to face joint demand? -Apples -Tables -Pets -Spark plugs -Jewelry
Spark plugs
Juan owns a sporting goods company based in Mexico City. He wants to sell his products in other countries, so he researches USMCA and finds strong support for choosing either the United States or Canada to begin exporting products. Juan likely noticed which of the following advantages of the free trade agreement?
Tariffs have been virtually eliminated on goods produced and traded among Canada, Mexico, and the United States.
A new social media network based in Sweden, where social media and internet usage is very high, decides to expand its footprint. It already saturated countries like Australia, the United States, Canada, and Spain. The company briefly considered expanding into Egypt but decided against it when it learned smartphone penetration is very low in Egypt. What environmental force is impacting this marketing decision?
Technological forces
Which of the following differs from other international trade alliances in its commitment to facilitating business and its practice of allowing the business/private sector to participate in a wide range of activities?
The Asia-Pacific Economic Cooperation (APEC)
The difference in value between a nation's exports and its imports
balance of trade
Logitech is a computer peripherals company that was founded in Switzerland in 1981. From the outset, the founders realized they would need to expand internationally if they wanted to compete in the market. Soon it had offices and/or factories in Switzerland, Taiwan, China, the United States, and Ireland. Its corporate headquarters is in Silicon Valley, but it maintains a factory in China. Eight years after it was founded, Logitech had captured 30 percent of the market share in the computer peripherals industry. Refer to Scenario 8.1. Logitech would most likely be categorized as a _______ firm.
born global
Spotify is a digital music service based in Sweden. Spotify was created when music industry revenue was in decline. From the start, Spotify intended to be an international music streaming service, securing agreements with the four largest U.S. record labels. Spotify quickly ramped up international expansion. Spotify would most likely be categorized as a(n) _______ firm.
born global
The role of an export agent is to
bring buyers and sellers from different countries together and collect a commission for arranging sales.
The people within an organization who make business purchase decisions
buying center
In the EU, some people claim that Google restricts advertisements sold by other companies and pre-installs its search engine as a default on mobile devices. This concern is most likely related to _______.
competitive forces
The practice of hiring a foreign firm to produce a designated volume of the domestic firm's product or a component of it to specification; the final product carries the domestic firm's name
contract manufactoring
Logitech is a computer peripherals company that was founded in Switzerland in 1981. From the outset, the founders realized they would need to expand internationally if they wanted to compete in the market. Soon it had offices and/or factories in Switzerland, Taiwan, China, the United States, and Ireland. Its corporate headquarters is in Silicon Valley, but it maintains a factory in China. Eight years after it was founded, Logitech had captured 30 percent of the market share in the computer peripherals industry. Refer to Scenario 8.1. Logitech has many of its products built in China using third parties. However, it has also built its own factories to protect some of its manufacturing trade secrets. Logitech uses a combination of _______ and _______ when manufacturing products.
contract manufacturing; direct ownership
Christina manages the accounting department of a consumer electronics firm. She recently sent in a request to purchase 50 new computers for her accounting staff because the computers they are working on are outdated. Miguel was given the task of choosing the supplier and purchasing the products. Since Miguel is not as knowledgeable about computers, he turns to Natalia, who works in IT, for advice. Natalia knows all about the latest computers, systems, and software. With Natalia's help, Miguel looks at the alternatives and selects Dell as their supplier. Refer to Scenario 7.2. After Miguel chooses Dell as the supplier, Christina orders 50 computers from Dell.com, which offers special access through a password-protected portal to B2B customers where they can track orders, see past orders, and access relevant information. In this case Dell.com is a(n) _______.
corporate website
The concept that morality varies from one culture to another and that business practices are therefore differentially defined as right or wrong by particular cultures
cultural relativism
The feasibility and degree of globalization is determined by the
degree of similarity among the various environmental and market conditions.
Demand for business products that stems from demand for consumer products
derived demand
products sold in foreign countries at unfairly low prices.
dumping
A government's suspension of trade in a particular product or with a given country
embargo
To monitor changes in the marketing environment effectively, marketers must engage in
environmental scanning and analysis
The sale of products to foreign markets
exporting
A duty levied by a nation on goods bought outside its borders and brought into the country
import tariff
A person's buying power is a function of
income, wealth, and credit.
When using credit to make purchases, consumers are
increasing current buying power at the expense of future buying power.
Demand that is not significantly altered by a price increase or decrease
inelastic demand
You recently raised your prices on the products you sell to your business customers. To your surprise, these customers did not change the amount of units they purchase from you. It was as if the price increase did not matter to these customers. Which of the following types of business demand most accurately describes this situation?
inelastic demand
Developing and performing marketing activities across national boundaries is called
international marketing
Glenda works in the buying center at a personal protection safety equipment firm. Whenever she needs a certain product, she always orders from Christian. Although other suppliers might be less expensive, Glenda has worked with Christian before and trusts him completely to deliver all supplies to the exact specifications. She values this trust and would rather work with Christian than having to take a chance on another supplier who might be less expensive. Which factors are influencing the business buying decision process?
interpersonal
Demand involving the use of two or more items in combination to produce a product
joint demand
A partnership between a domestic firm and a foreign firm or government
joint venture
Even when reciprocal buying arrangements are legal, they can lead to
less-than-optimal purchases.
An alternative to direct investment that requires a licensee to pay commissions or royalties on sales or supplies used in manufacturing
licensing
If Caterpillar wished to reach the market in Malaysia but was leery of a direct investment in the country, it might provide a Malaysian operation with the knowledge to produce and market its products in exchange for a commission or royalties. This type of arrangement is called
licensing
Oleg owns an ice cream and frozen treat restaurant and is considering adding new menu items. He recently met with the representative of a yogurt company who is trying to convince Oleg to add the frozen yogurt to his menu. Oleg has never offered a yogurt product in the restaurant and has concentrated on ice cream items. The yogurt product would not need a different freezer or dispensing unit, so the investment would be similar to changing flavors of ice cream. However, because he's never offered yogurt, he's unsure what the market response will be and how much profit he can achieve with the frozen yogurt. What type of purchasing decision does this represent for Oleg?
modified rebuy
A new-task purchase that is changed on subsequent orders or when the requirements of a straight rebuy purchase are modified
modified rebuy purchase
An organization's initial purchase of an item to be used to perform a new job or solve a new problem
new-task purchase
The practice of contracting with an organization to perform some or all business functions in a country other than the country in which the product will be sold
offshore outsourcing
The practice of moving a business process that was done domestically at the local factory to a foreign country, regardless of whether the production accomplished in the foreign country is performed by the local company (e.g., in a wholly owned subsidiary) or a third party (e.g., subcontractor)
offshoring
The practice of contracting noncore operations with an organization that specializes in that operation
outsourcing
inelastic demand in business markets refers to a situation where
price increases or decreases will not significantly change demand for a given product.
Walmart implemented an online system for its supply chain called RetailLink. RetailLink is a secure system that permits all suppliers and others to facilitate exchanges and share information on purchasing, inventory, negotiating, and more. It also allows its suppliers to get information on inventory levels and sales from different Walmart stores. This is an example of a(n) _______.
private B2B exchange
Marketers that attempt to influence and change the various environmental forces have a(n) ____ response to these forces.
proactive
Individuals and business organizations that purchase products to make profits by using them to produce other products or using them in their operations
producer markets
A limit on the amount of goods an importing country will accept for certain product categories in a specific period of time
quota
Crisanto's company just started exporting cheddar cheese to the United States. Unlike some of the other countries that it trades with, there is a set limit to how much cheddar cheese it can export to the United States without paying higher tariff rates. Crisanto is confused about this and asks his manager about it. His manager replies that the United States has a(n) _______ on cheddar cheese.
quota
An arrangement unique to business marketing in which two organizations agree to buy from each other
reciprocity
The stages of the business buying decision process, in order, are
recognizing the problem, establishing product specifications, searching for products and evaluating possible suppliers, selecting suppliers and products, and evaluating performance.
The three purposes for which individuals or groups can use products in order for it to be considered a business market are
resale, use in daily operations, and direct use in producing other products.
Golden State Wines has national distribution agreements with wineries across the United States such as Mason and Robert Mondavi in Napa Valley, California. Golden State Wines receives its inventory from its winery suppliers and makes the wine available to customers—restaurants, bars, hotels, etc., through its sales representatives and extensive catalog. What type of business market does Golden State Wines represent?
reseller
Intermediaries that buy finished products and resell them for a profit
reseller markets
Levi owns a store that sells cooking products to end consumers. He has worked with the same supplier for many years and trusts the supplier completely. Whenever Levi needs to order new inventory from his supplier, he sends them information specifying the type of product, the quantity, the color, and some general quality characteristics. Levi has been with his supplier for years and knows how thorough they are. Finding defective products is so rare that Levi doesn't even bother examining the shipment, other than to make sure the products adhere to the standards specified. Refer to Scenario 7.1. Levi regularly orders office and shipping supplies from Amazon Business as the prices are reasonable and the products ship to him within two to three days. In this case Amazon Business is a(n) _______.
retail website
FedBid is used by businesses that want to supply goods and services to government agencies. When an agency needs a product, it invites businesses to bid to supply the specified good or service in competition with each other, and the lowest bidder wins the contract to supply the product. FedBid is a(n) _______.
reverse auction
If a certain country considered handshakes in business transactions to be taboo and preferred to use nodding, this would be an example of differences in ____ forces.
sociocultural
A representative from Maine Root stops by at a local fast-food restaurant once a month to inquire how much soft drink syrup the store will need. The restaurant's orders are an example of which type of business purchase?
straight rebuy
A routine purchase of the same products under approximately the same terms of sale by a business buyer
straight rebuy purchase
Nuhitzu believes it has the technological expertise to produce communication systems that will be leaders around the globe. Boston Electronics is widely regarded as having excellent management systems and superior marketing programs. To utilize these strengths, the two firms might form a(n) ____ to work together on a worldwide basis.
strategic alliance
A partnership that is formed to create a competitive advantage on a worldwide basis
strategic alliances
Sometimes business partnerships are formed between traditional rivals competing for market share in the same product class. These partnerships are known as
strategic alliances
Estonia is a member of this trading bloc, _______, which has a shared currency across most of its countries. Additionally, many of the governments in this trading bloc are similar in form.
the European Union (EU)
A company not involved in manufacturing that links together buyers and sellers in different countries is usually referred to as a
trading company
A company that links buyers and sellers in different countries
trading company
An evaluation of each component of a potential purchase
value analysis
The accumulation of past income, natural resources, and financial resources is known as
wealth
___ buy products from manufacturers and then resell the products to other firms in the distribution system.
wholesalers
