Marketing Exam 2
The Precision Writing Instruments Company makes a high-end pen known as the Cordova. Materials cost per pen is $6. Labor cost per pen is $5. Production overhead is $1,000,000. Advertising and promotion is $1,000,000. What is the total cost for sales of 500,000 units of the Cordova design?
$7,500,000
what is a shopping product?
(compares several alt. on criteria such as price, quality or style)
North Safety Products manufactures butyl gloves that offer permeation resistance to gas or water vapors for workers who use dangerous chemicals like ketones. The company has fixed costs of $10 million for its butyl glove production and unit variable costs of $5 per pair. If the company charges $15 per pair, how many pairs of gloves must it sell to break even?
1,000,000 pairs
2 broad categories of products: 1. what are consumer products? 2. what are business products?
1. products purchased by the ultimate consumer 2. are products organizations buy that assist in providing other products for resale
How is customer service related to logistics management? A firm must drive down logistics costs as long as it can still satisfy customer requirements. Meeting customer needs is the sole responsibility of the manufacturer. Every channel member should have input in product design if it affects the way a product is used by the ultimate consumer. Customers should dictate how, when, and where products are distributed regardless of cost to the manufacturer or its intermediaries. The responsibility to satisfy customers' needs applies equally to all members of a supply chain.
A firm must drive down logistics costs as long as it can still satisfy customer requirements. Logistics deals with decisions needed to move a product from the source of raw materials to consumption, or the flow of the product. Those decisions have to be made in a cost-effective manner. While it is important to drive down logistics costs, a firm must still deliver expected customer service, which means satisfying customer requirements.
Which of the following is not a factor that would be considered noise in the communication process? Multiple Choice A wrong image is used in a newspaper ad. A message has been repeated very frequently on radio and television. A printing mistake in a press release. A prospect for a firm's product cannot understand the salesperson during a presentation because of her accent. A radio advertisement uses slang.
A message has been repeated very frequently on radio and television.
Which of the following statements regarding Internet marketing channels is most accurate? Internet marketing channels perform facilitating functions at only a slightly higher cost than traditional marketing channels. Internet marketing channels do not look a lot like common marketing channels because there is no need for warehousing products. Internet intermediaries can perform all logistical functions effectively. A unique feature of these channels is that they combine electronic and traditional intermediaries to create time, place, form, and possession utility for buyers. Internet marketing channels use combinations of mail and telephone to conduct business with ultimate consumers.
A unique feature of these channels is that they combine electronic and traditional intermediaries to create time, place, form, and possession utility for buyers.
__________ begins with new-product purchases first by innovators, and then by early adopters. The consumer decision process The innovation adoption continuum The offering adoption model Diffusion of innovation The market-product life cycle
Diffusion of innovation
Which of the following statements about attitude tests is most accurate? Multiple Choice With attitude tests, product information, product samples, or premiums are offered to an ad's readers or viewers, and ads generating the most inquiries are considered the most effective. With attitude tests, a question such as, "What ads do you remember seeing yesterday?" is asked of respondents without any other prompting. Attitude tests involve studies such as controlled experiments and consumer purchase tests. In an attitude test, respondents are asked questions to measure changes in their attitudes after an advertising campaign. In an attitude test, respondents are first shown an ad and then asked whether their previous exposure to it was through reading, viewing, or listening.
In an attitude test, respondents are asked questions to measure changes in their attitudes after an advertising campaign.
Pebble used a skimming pricing strategy to introduce its new Pebble Smartwatch. Which of the following conditions would argue against using a skimming pricing strategy when introducing this new wearable computing device? A large potential market exists, even at a high price. Technological problems still exist for competitors, prohibiting their entry into the market for at least six months. Increasing volume substantially reduces production costs. Consumers perceive a price-quality relationship. The product is relatively price insensitive (price inelastic).
Increasing volume substantially reduces production costs.
Which of the following statements regarding newspapers as an advertising medium is most accurate? Multiple Choice One benefit of newspapers is that they are often saved indefinitely, meaning their advertising has a long lifespan. Online news services have rekindled an interest in print media news. More cities are increasing the number of newspapers available in kiosks at mass transit stations for commuters. Recycling newsprint has led to dramatic reductions in production costs. Local retailers often use newspapers as their sole advertising medium.
Local retailers often use newspapers as their sole advertising medium.
Which of the following statements regarding direct marketing is most accurate? Multiple Choice Direct selling provides less customer service than direct response marketing. Although direct marketing usually saves customers time, it does not usually save money. Although direct marketing can save consumers time and money, the process is labor intensive and not very much fun. Many customers believe direct marketing saves time, is entertaining, and offers privacy. Direct customers feel that their privacy is more likely to be compromised with direct marketing than with other methods.
Many customers believe direct marketing saves time, is entertaining, and offers privacy.
Which of the following is a potential problem when using fear appeals in advertising? Overly threatening messages have a negative effect on the intention to adapt behavior. What adults find scary, children usually do not. Many forms of media are hesitant to allow these ads to be shown because of liability concerns . Most frightening advertisements offend someone. Fear appeals undercut the image of the product's perceived quality.
Overly threatening messages have a negative effect on the intention to adapt behavior.
Which of the following statements concerning the pricing of services is most accurate? Consumers generally find the pricing of consumer services more realistic than the pricing of consumer products. Service pricing plays a role in balancing consumer demand for services. Service pricing only considers monetary costs to deliver the service. Pricing for services is generally subjective and not based on formulas or break-even points. Service pricing is relatively insensitive to consumer service quality perceptions.
Service pricing plays a role in balancing consumer demand for services.
A __________ visually shows that the total revenue curve and the total cost curve intersect at a point of zero profit.
a break even chart
Central to integrated marketing communications (IMC) is Multiple Choice the promotion of a product category as a means of building awareness. explaining the technical sophistication of a product. gaining direct and immediate feedback. a consistent message across all audiences. explaining the degree of support available after the sale.
a consistent message across all audiences.
Research shows that __________ is the single most important factor for a new product to defeat competitive ones—having superior characteristics that deliver unique benefits to the user. market attractiveness a distinctive point of difference good execution of the marketing mix a complete market and product protocol economical access to buyers
a distinctive point of difference
Which of the following is NOT an example of a price? a premium a commission a salary fees a tax
a tax
The three major types of vertical marketing systems are corporate, contractual, and cooperative. integrated. administered. delegated. categorical.
administered Vertical marketing systems are professionally managed and centrally coordinated marketing channels designed to achieve channel economies and maximum marketing impact. The major types of vertical marketing systems are corporate, contractual, and administered.
The headline of a General Motors advertisement in a Reader's Digest magazine read, "I believe these kids will make great engineers. Now I've got to make them believe it." The ad shows an engineer surrounded by seven young people. The ad copy talks about how General Motors believes the more the company puts into the community, the more society will get out of the community. This advertisement is an example of a(n) Multiple Choice competitive institutional advertisement. competitive product advertisement. publicity announcement. advocacy advertisement. pioneering institutional advertisement.
advocacy advertisement
Nonprofit service organizations use them, but public service announcements (PSAs) Multiple Choice tie up a very large percentage of the advertising budget. alone are not a good foundation because their timing and location are controlled by others. are boring and rarely well designed; consumers usually tune them out. have a very limited reach and frequency. are an ineffective form of advertising because social messages are not perceived as persuasive.
alone are not a good foundation because their timing and location are controlled by others.
Continuous scheduling would most likely be used for advertising Multiple Choice fireplace servicing. pool accessories. school supplies. baby food. soccer cleats.
baby food
Tiffany & Co., the exclusive jewelry retailer, uses ________ when it manufactures about half of the fine jewelry items for sale through its more than 250 specialty stores and boutiques worldwide.
backward integration Backward integration is the practice of retailers owning a manufacturing operation.
Which of the following is an example of deceptive pricing? vertical price fixing horizontal price fixing loss-leader pricing bait and switch odd-even pricing
bait and switch
n the new-product development process, the __________ stage assesses the total "fit" of the proposed new product with the company's mission and objectives—from whether the product or service can be economically produced to the marketing strategy needed to have it succeed in the marketplace. Multiple Choice idea generation screening and evaluation business analysis development commercialization
business analysis
A benefit of performing a SWOT analysis and an environmental scan during the new-product strategy development process is that they
can help identify the strategic role the new product might serve in the firm's portfolio.
To encourage retailers to pay their bills quickly, manufacturers offer them cash discounts. cumulative discounts. seasonal discounts. trade discounts. functional discounts.
cash discounts
After reading the daily newspaper, the restaurant owner of Zefferelli's Tower of Pizza said, "I see that the owner of Fellini's House of Noodles ran a quarter-page ad in today's paper. We'll have to match his efforts by running our own ad the day after tomorrow." Based on this statement, what promotional budgeting technique is the Zefferelli's restaurant owner most likely using? objective and task budgeting all you can afford budgeting competitive parity budgeting comparative budgeting percentage of sales budgeting
competitive parity budgeting Competitive parity budgeting involves matching the competitor's absolute level of spending or the proportion per point of market share. It is important to consider the competition in budgeting.
ntel Core processors are purchased by Toshiba for its laptops, and are thus considered what type of business product? support products components supplies derived products installations
components
what are the 4 types of consumer products?
convenience (freq. & conveniently) shopping(compares several alt. on criteria such as price, quality or style) specialty (special effort to search out and buy) unsought
Which of the following is not a consumer-oriented sales promotion? Multiple Choice rebate cooperative advertising premium point-of-purchase display sweepstakes
cooperative advertising
According to experts studying services, the ________ should be intentional, planned, and consistent so that every performance is similar, differentiated from other services, relevant, and valuable to the target market. capacity evaluation customer experience consumer expertise customer evaluation consumer encounter
customer experience
The ability of a logistics system to satisfy users in terms of time, dependability, communications, and convenience is referred to as
customer service
Many shoe stores have sales during which they offer 50% off the second pair you purchase when you purchase the first pair at full price. This offer is an example of a Multiple Choice rebate. premium. deal. product placement. coupon.
deal
As consumer demand for new homes increases, appliance manufacturers and building material suppliers may experience an increase in demand for their products, which is an example of sequential demand. concurrent demand. derived demand. secondary demand. primary demand.
derived demand
Google's driverless car is an extreme example of the complexity of which step of the new-product process? business analysis idea generation screening and evaluation development commercialization
development
Fitness trackers are in the growth stage of the product life cycle. A manufacturer selling one of these devices would most likely use advertising to Multiple Choice create product category awareness. differentiate one brand of device from another. create selective distribution channels. reposition fitness trackers. remind buyers of the marketer's and its product's existence.
differentiate one brand of device from another. In the growth stage, the need is to persuade buyers, and advertising's role is to gain brand preference by distinguishing the product from others. See Figure 14-3.
Factors such as the need for improved reliability and security in postal systems and new government regulations represent important challenges for __________ in the global market. direct marketing direct selling personal selling direct response marketing publicity
direct marketing Direct marketing faces several challenges in global markets. Several countries have requirements for mandatory "opt-in" and other complicating legislation. Also, the mail, telephone, and Internet systems in many countries are not as well developed as they are in the United States.
In a strategy known as ________, GE sells its large appliances directly to home and apartment builders, but uses retail stores, including Lowe's home centers, to sell to consumers. dual distribution multichannel distribution parallel distribution a strategic channel alliance multibrand distribution
dual distribution Dual distribution is an arrangement whereby a firm reaches different buyers by employing two or more different types of channels for the same basic product.
A firm can become a channel captain because it is typically the channel member with the ability to influence the behavior of other members. Which of the following is the most likely source of that influence? social interactions with the community at large familial ties to other channel members longevity in the industry geographic proximity to the manufacturing plant economic power
economic power A firm becomes a channel captain because it is the channel member with the ability to influence the behavior of other members. Influence can take four forms. One of them, economic influence, arises from the ability of a firm to reward other members, given its strong financial position or customer franchise. Microsoft Corporation and Walmart have such influence.
What is target pricing?
estimating the price that the ultimate consumer would be willing to pay for a product, then working backward through markups taken by retailers and wholesalers to determine wholesale price
Some well-known message problems have occurred when U.S. companies have taken their messages to cultures with different ________, resulting in misinterpretations. Multiple Choice lifestyles cultural values channels of communication feedback loops fields of experience
fields of experience
The Upjohn Company first targeted men for its Rogaine topical solution, a drug to restore hair growth, but later marketed this product to women. In this example, the Upjohn Company is using which of the following market modification strategies? creating new use situations increasing use by existing customers finding new users modifying the product reacting to competitors' positions
finding new users
Consumer products are classified based on the attributes used in making the purchase decision, the effort spent by the consumer, and the
frequency of purchase.
A few years ago, Young and Rubicam, Inc. developed the "Softer Side of Sears" campaign to target middle-income women. This agency provided research about that segment, media choices, and complete production of advertising for Sears. Young and Rubicam is an example of a(n) Multiple Choice image consultant. consulting firm. limited-service advertising agency. in-house agency. full-service advertising agency.
full-service advertising agency.
One of the disadvantages associated with radio as an advertising medium is that it Multiple Choice cannot target specific audiences. does not have a perishable message. has no visual element. minimizes the likelihood of wasted coverage. is not effective for conveying simple messages.
has no visual element
When a manager at Jackie's Bar & Grill sent some of his wait staff home early on a slow Tuesday night, he recognized a need to manage his off-peak convenience. idle production capacity. selective demand. intangibility. inconsistency.
idle production capacity.
Keith liked how the dry cleaner down the street washed and pressed his clothes, but he found the repeated phone calls from staff about his finished laundry annoying. He began to think of the whole place as annoying, which is a function of the __________ aspect of services. inventory inseparability imperfection intangibility impressionability
inseparability
serices are:
intangible activities or benefits that an organization provides to satisfy consumers' needs in exchange for money or something else of value.
Skimming or penetration pricing are appropriate pricing strategies during the __________ stage of a product's life cycle. growth commercialization launch introduction awareness
introduction
Which of the following is considered a part of total logistics cost, like transportation and order processing? communication between buyer and seller inventory problem resolution order cycle time product promotion
inventory Important total logistic cost factors in a supply chain include transportation, warehousing and materials handling, order processing, stockouts, and inventory management.
what is a durable good?
lasts over many uses (car, appliances, smart phones)
Adding a wholesaler to the marketing channel for consumer products is most common for low-cost, high-unit value items. high-cost, low-unit value items. high-cost, high-unit value items. any item regardless of cost as long as there is sufficient product variety. low-cost, low-unit value items.
low-cost, low-unit value items. Adding a wholesaler is most common for low-cost, low-unit value items that are frequently purchased by consumers, such as candy, confectionery items, and magazines.
A marketing channel is the medium that explains the benefits of a product to consumers. is the link between all suppliers providing raw materials to the manufacturer in order to create the final product. is the specific form of transportation used to get the product from the manufacturer to the ultimate consumer. is the form of message that will be most persuasive to customers. makes possible the flow of products and services from a producer, through intermediaries, to a buyer.
makes possible the flow of products and services from a producer, through intermediaries, to a buyer.
At which stage in the product life cycle would a company's promotional objective most likely be to remind buyers of the product's existence? Multiple Choice introduction growth maturity decline accelerated development
maturity
Most of Lands' End's revenues come through catalog and Internet sales, but it also operates several retail stores and factory outlets. This makes Lands' End an example of a(n) __________ marketer.
multichannel Multichannel marketing is the blending of different communication and delivery channels that mutually reinforce in attracting, retaining, and building relationships with consumers who shop and buy in traditional intermediaries and online.
Sears offers a Craftsman radial saw for $499.99, under the presumption that consumers see the Craftsman radial saw as priced at "something over $400" rather than "about $500." This is an application of what pricing strategy?
odd even pricing
__________ advertising can be interactive, with drop-down menus, built-in games, or search engines to engage viewers. Multiple Choice Pioneering Online Advocacy Outdoor Television
online
The seven Ps of services refer to an expanded marketing mix for services that includes the four Ps (product, price, place, and promotion) as well as people, process, and productivity. personality, performance, and process. productivity, performance, and profitability. personality, procedure, and performance. people, physical environment, and process.
people, physical environment, and process.
The promotional mix consists of communication tools that include advertising, public relations, sales promotion, direct marketing, and Multiple Choice multicultural marketing. social media. personal selling. target marketing. online marketing.
personal selling
What is the promotional objective of the decline stage of the product life cycle? Multiple Choice inform persuade compare remind phase out
phase out The decline stage of the product life cycle is usually a period of phase-out for the product, and little money is spent in the promotional mix.
Which of the following would be conducted before an advertisement was placed in any medium? Multiple Choice sales test attitude test aided recall portfolio test inquiry test
portfolio test
One step in evaluation of the promotion program is to set the budget. state the mission. posttest the promotion. select the appeal. select the media.
posttest the promotion. Evaluating the promotion program includes posttesting the promotion and making needed changes.
Jury tests refer to Multiple Choice presenting a panel of consumers with an ad and asking for their reactions concerning the ad's effectiveness, appeal, etc. placing a test ad in a collection with several other ads, asking consumers to read through them, and then asking them for their impressions of the ads . presenting a panel of consumers with an ad for a limited period of time, then removing the ad and asking the respondents to recall as much pertinent information as possible. presenting consumers with a sample of a product and several different advertisements for the product, then asking them to select the one they think is most effective and explain why. using electronic devices to measure viewer response or feelings after viewing an advertisement.
presenting a panel of consumers with an ad and asking for their reactions concerning the ad's effectiveness, appeal, etc.
__________ represents the vertical axis of a demand curve graph.
price per unit
Which of the following would be an example of a variable cost for a publication like SHAPE Magazine that is targeted to young women seeking a healthier lifestyle? an increase in women in targeted demographics printing and binding of the magazine the salary of the publisher's CEO the rent for a parking garage used by employees the cost of a half-page ad in SHAPE
printing and binding of the magazine
Axe Anarchy Bodywash, a men's personal care product, is an example of a product item. product unit. product line. product mix. product class.
product item.
When choosing a marketing channel and intermediaries, marketing executives typically consider, among other things, which will provide the best coverage of the target market. be easiest to control. identify pricing strategies. be most concerned about avoiding channel conflict. be most concerned with avoiding cannibalization.
provide the best coverage of the target market.
Which element of the promotional mix has the inherent weaknesses related to the difficulty in getting media cooperation? Multiple Choice advertising personal selling sales promotion public relations direct marketing
public relations
When a pharmaceutical company places an ad in a home and garden magazine for its new arthritis drug, it is using a ________ strategy. multichannel push direct hook pull
pull A manufacturer may elect to implement a pull strategy by directing its promotional mix at ultimate consumers to encourage them to ask the retailer for a product. Seeing demand from ultimate consumers, retailers order the product from wholesalers and thus the item is pulled through the intermediaries.
If you buy fewer than 10 pairs of UVex Clear UVExtreme safety eyewear for your employees, the cost is $7.40. But if you buy 10 or more pairs in a single purchase, the price per pair is reduced to $6.85. This is an example of a
quantity discount
__________ advertising is good for products that have achieved a well-recognized position and are in the mature phase of their product life cycle. Multiple Choice Institutional Reinforcement Competitive Pioneering Reminder
reminder
Hewlett-Packard's recycling service for computers and printers is available today in more than 73 countries, regions, and territories. Hewlett-Packard has recycled over 2 billion pounds of used electronic products and supplies to be refurbished for resale or donation or for recovery of materials. Hewlett-Packard is practicing
reverse logistics
Inconsistency in services refers to the fact that
services depend upon the people who provide them, and the quality of that performance may vary from day to day or employee to employee.
Penetration pricing is
setting a low initial price on a new product to appeal immediately to the mass market.
An important feature of supply chain management is its application of sophisticated information technology that allows companies to share supply chains that use slower modes of transportation but faster order processing. share supply chains that use the least expensive mode of transportation possible. share and operate systems for order processing, transportation scheduling, and inventory and facility management. manage supply chains using small, dispersed inventory warehouses. achieve economies of scale by having all inventory stored and sorted at a central location.
share and operate systems for order processing, transportation scheduling, and inventory and facility management. An important feature of supply chain management is its application of sophisticated information technology that allows companies to share and operate systems for order processing, transportation scheduling, and inventory and facility management.
Ideally, before a new product is developed, a firm should have a precise protocol, which includes which of the following? a clear marketing plan realistic financial goals and expectations a comprehensive SWOT analysis a precise budget of how much can be spent for a new offering's marketing program specific customers' needs, wants, and preferences
specific customers' needs, wants, and preferences
Which of the following occurs during the planning stage of the promotion decision process? pretest the advertisement state the mission specify the objectives identify possible advertising or promotional firms posttest the advertisement
specify the objectives During the planning phase, a firm will identify the target audience, specify the promotion objectives, set the budget, select the right promotional tools, design the promotion, and schedule the promotion.
Which of the following products is the best example of a product that might experience an introduction, a decline, and then a resurgent reintroduction as part of its normal product life cycle? Multiple Choice tattoos body lotion dog toys colored markers tax accounting
tattoos
Mass selling is Multiple Choice the high-quantity sales of unique products based upon the needs and wants of individual consumers. the opposite of customized interaction, meaning a single message is delivered to the whole group of prospective buyers. the translation of a company's message into multiple languages for use in advertising in different countries or regions. the use of different images (such as on the cover of Sports Illustrated) to create a more intimate relationship between buyer and seller. the production and sales of a single item that contains no variation of product benefits.
the opposite of customized interaction, meaning a single message is delivered to the whole group of prospective buyers.
Price elasticity of demand refers to
the percentage change in quantity demanded relative to the percentage change in price.
In advertising, rating refers to Multiple Choice the geographic region to which an advertising campaign will be directed. the gross number of individuals exposed to an advertisement. the percentage of households in a market tuned to a particular TV or radio program. the commonly used reference number that equates the customer likeability rating for an advertisement multiplied by its frequency. the average number of times a person in the target audience is exposed to the advertising message.
the percentage of households in a market tuned to a particular TV or radio program.
A Starch test uses all of the following to score an advertisement except which? Multiple Choice the percentage of those who read at least half of the ad the percentage of those who saw or read any part of the ad the percentage of those who found the content informative the percentage of those who saw or read any part of the ad identifying the product or brand the percentage of those who remember seeing a specific ad
the percentage of those who found the content informative
decoding is done by who?
the receiver
Products that the consumer does not know about or knows about but does not initially want are referred to as
unsought products.
A channel intermediary in the consumer market that sells to other intermediaries, usually retailers, is called a(n)
wholesaler:Wholesalers sell to other intermediaries, usually retailers, and the label is typically applied in consumer channels.
When Procter & Gamble bought the Old Spice brand in 1990, it planned to transform the old, stagnating brand into a men's "personal-care powerhouse." The ads that P&G developed shed the older-man image, and the message is now targeted at the 18- to 34-year-old age group. In terms of the communication process, the __________ would decode the message. Multiple Choice older-men market segment Old Spice marketers younger-men market segment vehicle used for advertising, like television the fields of experience
younger-men market segment
