Marketing Management Final Review

Typically, the ________ is responsible for building good distribution channels and implementing "Place" policies.

Sales Manager

Which statement is most likely to be made by a manager with a status quo pricing objective?

"A price of $10.00 will not start a price war with our competitors."

When a firm is interested in targeting customers during the information-gathering stage of the buying process and wants to measure the return on investment in advertising, which method should it adopt for its digital advertising?

Search Advertising

A discount that is offered to encourage buyers to buy earlier than present demand requires is

Seasonal Discount

A producer makes an item for $32 and sells it with a 50 percent markup to a wholesaler. The wholesaler then applies a 20 percent markup. A retailer then uses a 60 percent markup. The final retail selling price is

$200

Blue Ridge Weavers wants to set its selling price on an item so that the retail list price will be $50—taking into account the usual markups of 10 percent at wholesale and 30 percent at retail. At what price should Blue Ridge Weavers sell the item?

$31.50

A producer sells an item to a wholesaler for $4.00, and the wholesaler uses a markup of 25 percent on its selling price. What will be the cost to the retailer?

$5.33

Mark is trying to determine his firm's average cost per unit of production. He finds that the cost for all labor and materials is $80,000, and fixed overhead expenses are $40,000. If the company produces 20,000 items in the time period, the average cost is

$6 (80,000 + 40,000) / 20,000 = 6

Bennett posted a video of his dog playing with the PetSafe Automatic Ball Launcher. It became very popular and was watched 100,000 times on YouTube. This is an example of

Viral Promotion

When a company is able to get its customers to spread a message far and wide, it is referred to as

Viral Promotion

Refer to the Yummy Ice Cream case. Which example illustrates customer-initiated interactive communication?

A customer goes to Yummy's website to see if Yummy has an ice cream shop that is nearby.

What is the best example of owned media?

A jewelry store creates a Facebook page for its products.

A pest control company using the most common method of promotional budget planning is most likely to base its promotional budget on

A percentage of expected future sales revenue from pest control jobs.

When Darius bought a new window air conditioner for his home, he was given information to send to the manufacturer to receive money back for the purchase. This is

A rebate

A wholesaler has been offering his customers payment terms of 3/10, net 60. It wants to improve its terms because interest rates have gone up. It could change its terms to

3/10, net 30

A firm with a stockturn rate of 5 that sells products that cost it $150,000 per year is keeping an average of ________ worth of inventory.

30,000

The price per unit is $1.00. The average variable cost per unit is 60 cents. The total fixed cost is $20,000. What is the break-even point?

50,000 units $20,000 / (1 - 0.60) = 50,000 units

Fantasy Corporation is introducing a new travel product next month. To prepare for the introduction, the marketing manager is having his sales force call on distributors to explain the unique features of the new product, how the distributors can best promote it, and what sales volume and profit margins they can reasonably expect. Fantasy Corporation is not doing any promotion to end consumers. This is an example of

A Pushing Policy

Who is most likely to receive a slotting allowance?

A supermarket that agrees to begin stocking new products

When individual firms set their own prices—sometimes holding them steady for long periods of time—rather than letting daily market forces determine prices, such prices are called

Administered prices.

What does the acronym AIDA stand for?

Attention, Interest, Desire, Action

AAA Used Cars is a retail seller of used cars. Wilson, AAA's buyer goes to a ZZZ Wholesale Autos to buy used cars to bring back to their dealership. Wilson looks through various cars and bid on those they wants by submitting a price they are willing to pay for each car. ZZZ uses ________ pricing.

Auction

Final customers or users are normally asked to pay ________ prices for products they buy.

Basic List

Different firms in the same line of business are most likely to use the same markup percentage

Because they are likely to have similar operating expenses

Horace was looking online for a hotel for his trip to France. He clicked on a hotel, but left the site before making the purchase. Later, he noticed an ad in his Instagram feed for that hotel. This is a type of targeted advertising called

Behavioral Retargeting

A company uses an audio format to inform about and promote its products and grow its business. These are called

Branded Podcasts

A deceptive practice in which a website offers a free trial that turns into a paid subscription without warning is called

Dark Pattern

Although legal in the United States, ________ advertising is forbidden in some countries.

Comparative

An ad for Ford's lowest-priced truck claimed that it "is tougher, gives better mileage, and costs less than any other truck" and specifically named the directly competitive trucks. This is an example of

Comparative Advertising

Refer to the Sporting Products, Inc. (SPI) case. Randy Todd could use break-even analysis with his tennis racquet decision to

Compare the break-even quantity for different prices with the likely level of demand

Break-even analysis can be useful for

Comparing Price Alternatives

An ad stressing the advantages of one brand of cookware as compared to similar (but unnamed) competitive products is an example of ________ advertising.

Competitive

The Vitamin Place has set a suggested retail list price of $40 on its new multivitamin tablets on the assumption that its target market will find the product attractive at this price. From this suggested retail list price, The Vitamin Place has subtracted channel member's margins to arrive at its own selling price of $17. This is

Demand-Backward Pricing

The small file placed on the computer of a customer who visits a website that helps to track the customer and infer the customer's interests is called a(n)

Cookie

United Airlines maintains a frequent flier loyalty program that allows members to accumulate as few as 10,000 miles and then redeem these miles for a free one-way ticket. This is a(n)

Cumulative Quantity Discount

The impact of substitutes on price sensitivity is greatest when

Customers can compare prices

In the 30-minute TV infomercial for a new type of home gym equipment, a toll-free 800 number is prominently displayed across the bottom of the screen. This is an example of ________ promotion.

Direct-Response

Direct marketing communication designed to prompt immediate feedback by customers is also called

Direct-Response Promotion

At a company's annual day of service, 500 employees fanned out throughout the town to pick up garbage. The press was invited and stories appeared in the local newspaper and on the 6:00 news. This is an example of

Earned media from public relations

_______ depends on how well the medium fits with the rest of a marketing strategy, including the promotion objectives, the target markets, the funds available, and the nature of the media.

Effectiveness

An advertising manager is trying to decide what words to use in a magazine ad for the new Ford Focus. In the traditional communication model, the ad manager is the

Encoder

The source deciding what it wants to say and translating it into words or symbols that will have the same meaning to the receiver is referred to as

Encoding

An accountant is gathering information for year-end reports. He asks the owners to put together a list of the costs of rent, property taxes, and insurance. These items are ________ costs.

Fixed

When the Miller family went to a flea market, they saw people offering to pay less than the sellers advertised and usually getting the lower price. This flea market seems to use ________ pricing policies.

Flexible

A trusted or well-known figure who can sway attitudes or purchase decisions among a particular target market for the purpose of promoting brand is referred to as a(n)

Influencer

Total fixed cost

Is the sum of those costs that do not change in total no matter how much is produced

Which statement is true about marginal analysis?

It explicitly considers demand when calculating price

Refer to the Sporting Products, Inc. (SPI) case. If SPI uses average-cost pricing, one big problem will be that

It ignores the demand curve for its products

Which statements about publicity is true?

It includes posts on a company's website, viral videos, word-of-mouth communication, a company's Facebook page, and its "tweets" on Twitter

Which statement describes a characteristic of leader pricing?

It is different from bait pricing in that the marketing manager really expects to sell leader priced items

How does advertising differ from other forms of promotion?

It must be paid for, while another form of mass selling—publicity—is unpaid

A retailer of men's suits who is advertising a popular brand of dress shirts at a reduced price to attract customers is using

Leader Pricing

Javed works for Sports Advantage, a company that makes high-performance gels that runners use for energy during long-distance races. Under Javed's management, Sports Advantage spends a substantial amount of money for a table and handing out samples at most major long-distance races across the country. What most likely describes Javed's position at Sports Advantage?

Sales Promotion Manager

A ski resort is considering a promotional campaign that emphasizes ads in national ski magazines. Which disadvantage would most likely affect this campaign?

Low Lead Times

When looking for a Lyft car during rush hour, a customer notices that the same ride that she took earlier in the afternoon is three times more expensive. What explains this?

Lyft's surge pricing model adjusts prices to better match supply and demand for its services.

By using ________ software, a firm can track an individual customer's behavior and trigger actions in response to specific customer actions.

Marketing Automation

Determining the blend of promotion methods is a strategy decision that is the responsibility of the

Marketing Manager

A ________ is a dollar amount added to the cost of products to get the selling price.

Markup

Regarding promotion blends, which statement is true?

More targeted promotion is needed during the sales decline stage of the product life cycle

OfficeMates makes custom-imprinted three-ring binders for business customers. Its prices are: $4.00 per binder for a single order of up to 50 binders; $3.50 per binder for a single order of 51 to 100 binders; and $3.00 per binder for a single order over 100 binders. OfficeMates is using a

Noncumulative Quantity Discount

Which of these is a status quo pricing objective?

Nonprice competition

A cold storage facility wants to keep its inventory low. What would be least likely to encourage customers to take over more responsibility for the storage function?

Offering a cumulative quantity discount

A sales rep is paid a commission on each product sold. The commission is

Part of the total variable cost

What is true regarding product life cycles and promotion?

Persuading becomes important in the market growth stage

A company that produces DVD players has recognized they are in sales decline. What is most likely to happen at this point?

Prices and costs will both decline

Certain media for advertising may not always be available in other countries, or it may be restricted. For instance, in Europe, ________ laws make it more difficult to track consumers' online behavior and deliver targeted advertising.

Privacy

Apple Computer benefits when a news story discusses Apple's new iPhone without the company having to pay for it. This is called

Publicity

Hannibel Hammocks, Inc. uses dealer incentives, discounts, and sales contests in order to encourage retailers to give special attention to selling its products. Hannibel Hammocks is using

Pushing

A potential customer watches a TV ad for the new BMW 7-series sedan during the Academy Awards program. In the traditional communication model, the potential customer is the

Receiver

A rebate is a

Refund paid to consumers after a purchase

Southwest Airlines' "Ding" was an app that popped up on your computer desktop to let you know of lower fares to cities you wanted to visit. This is an example of a(n) _______ promotion objective.

Reminding

What basic promotion objective can be sought by a producer who has won brand insistence among its target customers?

Reminding

The Robinson-Patman Act

Requires that promotional allowances be made available to all of a firm's customers on "proportionately equal" terms

When her competitors have sales every spring, Sally's Fashions also holds a sale in her store. She is a fan of these sales, most likely because she can

Respond to changing market conditions without changing the basic market strategy

Typically, markup refers to a percentage of the

Selling price added to the cost

Comparative advertising

Should be supported by research evidence

A reduction from list price given to retailers to get shelf space for a product is a

Slotting-Allowance

BMW places a TV ad for its new 7-series sedan in the Academy Awards program. In the traditional communication model, BMW is the

Source

Every time Marcus open his email, he has dozens of unwanted, irrelevant messages trying to sell him something. These messages are called

Spam

Managers satisfied with their current market share and profits sometimes adopt what can be thought of as "don't-rock-the-pricing-boat objectives." These are also referred to as

Status Quo Objectives.

The form of pricing in which customers pay on a periodic basis for access to a product is referred to as

Subscription Pricing

________ costs are those that a customer faces by buying a product that is different from what has been purchased or used in the past.

Switching

Early Adpoters

Tend to be opinion leaders

The early majority group

Tends to avoid risk and waits to consider a new idea after many early adopters have tried it—and liked it.

The source of buying information trusted by the fewest percentage of consumers is

Text ads on mobile phones

The percentage of visitors who only visit a single page on a website is referred to as

The Bounce Rate

In the customer-initiated interactive communication process,

The buyer starts the process

When a firm is interested in earning word-of-mouth publicity from customers, which approach would help the firm?

The firm should ask for recommendations from satisfied customers

What is true regarding sales promotion?

The objectives and situation influence what specific type of sales promotion is best

Decoding is

The process of the receiver translating the message

What happens during the sales decline stage?

The total amount spent on promotion usually decreases as firms try to cut costs to remain profitable.

What is programmatic delivery?

The use of artificial intelligence to automate the placement of online advertising

When a firm offers advertising allowances to firms further along in a channel, what is the likely benefit it gets?

They encourage advertising or promoting of the firm's products locally.

Why should pricing objectives be explicitly stated?

They have a direct effect on pricing policies and the methods used to set the price.

Chrome, Safari, and Firefox eliminated ________, which may have caused Meta (Facebook) to lose millions in advertising revenue due to the fact that this made it harder to precisely target advertising.

Third-Party Cookies

What social media platform started in China under the name Douyin?

TikTok

What is/are among the typical promotion objectives of white papers and case studies?

To build customer trust and credibility

The price that maximizes profit is the one that results in the greatest difference between

Total Revenue and Total Cost.

_______ means setting a fair price level for a marketing mix that really gives the target market superior customer value.

Value Pricing

An automobile manufacturer charges a higher price for its hybrid car that runs on both electricity and gasoline than it charges for a car that runs on only gasoline. The manufacturer contends that the consumer will save money with the hybrid car in the long run because the money saved on gasoline will more than cover the price differential between the hybrid car and a regular car. This manufacturer is using

Value in use pricing