quiz 4 part 2

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How much money on average is it per sales call?

$350

global localization

(same thing as Glocalization)

How channel members add value

- Economic view point, intermediaries transform the assortment of products into assortments wanted by consumers -Channel members add value by bridging the major time, place,and possession gaps that separate goods and services from users -intermediaries offer the more than it can achieve Offer: information,promotion, contact, matching,negotiation, physical distribution, financing, risk taking

Personal Selling and Managing Customer Relationship

-Personal Selling is transaction-oriented to close a specific sale with a specific customer -long term goal= to develop mutually profitable relationships

The Role and Impact of Public Relations

-lower cost than advertising -stronger impact on public awareness than advertising -has power to engage consumers and make them part of the brand story

Invasion of Privacy

-the concern is that marketers may know too much about consumers and use this info ration to take unfair advantages a. sale of databases b. microtargeting

Sustainable Marketing Principles

1. Consumer Oriented marketing 2. Customer Value Marketing 3. Innovative Marketing 4. Sense-of-missio marketing 5. Societal marketing this is for best long-run performance

The Personal Selling Process

1. Prospecting and qualifying 2. Pre-aproach 3. Aproach 4. Presentation 5. Demonstration 6. Handling objections 7. closing 8. follow-up

Building Strong Brands

1. brand positioning 2. Brand name selection 3. Brand sponsorship 4. Brand development

Trends in Wholesaling

1. need for greater efficiency: consumers want even lower prices 2. Added-value customer relationships: need to add value by increasing efficiency and effectiveness of the entire marketing channel 3. Increase in customer demand for more services 4. Increase use of technology to boost productivity

Major Advertising Decisions

1. setting advertising objectives 2. setting the budget 3. developing advertising strategy (message decisions and media decisions) 4. evaluate advertising campaigns

Benefits of Direct Marketing to Sellers

1. tool to build customer relationships 2. low cost, efficient, fast alternative to reach markets 3. flexible 4. access to buyers not reachable through other channels

Vertical and Horizontal channels

1. vertical marketing systems: channel structure which producers, wholesalers, and retailers act as a unified system, one channel member owns the others a. Corporate Vertical marketing systems: integrates successive stages of production and distribution under single ownership b. contractual marketing systems: consists of independent firms at different levels of production and distribution join together through contracts c. Administered Marketing System: coordinates stages of production and distribution through the size and power of one of the parties 2. Horizontal channel: two or more companies at one level join together to follow a new marketing opportunity

manufacturer's export agent

A _____ provides a selling service for a manufacturer, has a short-term relationship, and operates on a straight commission basis.

False

A proper encoding system allows a company to correct errors before substantial damage occurs.

Janet works for a media agency based in Japan. Janet is helping the IMC manager of Siljure, a French cosmetics company, with the design and language to be used in an upcoming promotional campaign in Japan. The IMC manager knows what to convey but wants to advertise it in a culturally relevant manner. Which step of the IMC process is Janet helping Siljure with?

A. Encoding of the message

_____ is one of the major barriers to effective communication through advertising.

A. Language

A. Length and number

Of the seven steps involved in international advertising, _____ almost always represents the most daunting task for international marketing managers. A. developing messages B. selecting effective media C. executing the campaign D. composing and securing a budget E. specifying the goals of the communication

A. developing messages Of the seven steps in developing international advertising, developing messages almost always represents the most daunting task for international marketing managers.

Which of the following is an example of comparative advertising?

An ad showing a dog choosing one brand of dog food over another

True

As traditional channel structures are changing, importers and retailers are also becoming involved in new product development.

Which of the following factors affects the choice of distribution channels?

Available distribution intermediaries

In which of the following countries is the time spent on social media sites the highest?

C. Israel

In the context of media planning and analysis, billboards are especially useful in countries: A. with high income levels. B. where the laws governing the Internet are very complicated. C. with high illiteracy rates. D. where sales promotions are ineffective. E. where people prefer buying in small quantities.

C. with high illiteracy rates.

Of all the elements of the marketing mix, decisions involving _____ are those most often affected by cultural differences among country markets.

D. Advertising

Blogs, social networking, and video sharing are examples of media commonly known as _____.

D. Texas Visual Imaging

Define Advertising

Define: any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor

Pizza Hearth is in the process of deciding on the mode of entry into the Eastern European countries. Which phase of the international planning process is Pizza Hearth currently in?

Developing the marketing plan.

the United States

E-commerce is more developed in _____ than the rest of the world, partly because of the lower cost of access to the Internet than found elsewhere.

Minako works for a media agency based in Japan. Minako is helping the IMC manager of Siljure, a French cosmetics company, with the design and language to be used in an upcoming promotional campaign in Japan. The IMC manager knows what to convey but wants to advertise it in a culturally relevant manner. Which step of the IMC process is Minako helping Siljure with?

Encoding of the message.

Which of the following is a type of domestic middleman?

Export management companies

False

Export management companies work under their own names.

Which of the following modes of entry is a company most likely to use if it would "just like to get its feet wet" in the international marketing arena?

Exporting

Television is an advertising medium with no restrictions in most countries.

FALSE Companies that rely on television infomercials and television shopping are restricted by the limitations placed on the length and number of television commercials permitted when their programs are classified as advertisements.

When a message from a source is converted into effective symbolism for transmission to a receiver, the message is said to have been decoded.

FALSE If the message from a source is converted into effective symbolism for transmission to a receiver, the message is encoded. Decoding occurs when the receiver interprets the symbolism transmitted from the information source.

true

Factory outlet shops are an example of off-price retailers.

A majority of the population of less developed countries can be reached readily through the traditional mass medium of advertising.

False

General Motors, ________, and DaimlerChrysler have created a single online site called Covisint for purchasing automotive parts from suppliers.

Ford Motor Company

Ford's success in promoting " world cars" like the ford focus is a successful example of a. international positioning b. international travel c. satisfying consumer preferences. d. all of the above

domestic

Home-country middlemen are also known as _____ middlemen.

Market Segmentation (Define)

How companies divide large heterogenous markets in segments that can be reached more efficiently

True

Ideally, a website should be translated into the languages of the target market.

False

Industrial advertisers rarely use direct mail for advertising.

Which of the following is true of the distribution process?

It includes buying and selling negotiations.

Which of the following is true of a physical distribution system?

It includes transportation mode, inventory quantities, and packing.

Which of the following is true about international corporate planning?

It incorporates generalized goals for the enterprise as a whole.

Which of the following characterizes the business philosophy of the Japanese distribution channels?

Loyalty

_____ results from the added costs incurred as a result of exporting products from one country to another.

Price escalation

Product assortment decisions

Product assortments and service decisions: product assortment, services mix, and store atmosphere

false

Product length is defined as the total number of brands in the product mix- all the brands sold by the company worldwide.

false

Product trialability interferes with the diffusion process.

________ is a subject area that should be on the checklist of criteria for evaluating middlemen servicing a market

Productivity

Tokyo-Nagoya-Osaka

Sixty percent of the Japanese population lives in the _____ market area, which essentially functions as one massive city.

Creating or Partcipating in Social networks

Social Networks: allow members to congregate online and exchange views on issues of common interest (ex: Facebook) -engage by participating in exhisting communities or creating their own -to avoid mysteries and challenges of building online presence many companies have created their own target online communities

Standardized Marketing Mix vs. Adapated Marketing Mix

Standard:involves selling the same products and using the same marketing approaches worldwide Adapted: involves adjusting the marketing mix elements in each target market, bearing more costs but hoping for a larger market share and ROI

Study questions

True

The role of public relations is to create good relationships with the popular press and other media to help companies communicate messages to their publics—customers, the general public, and governmental regulators.

Sixty percent of the Japanese population lives in the ________ market area, which essentially functions as one massive city.

Tokyo-Nagoya-Osaka

false

Trade shows are an example of consumer sales promotion.

Deciding on the Global Marketing Program- Price

Uniform Pricing: is the same price in all markets but does not consider income or wealth where the price may be too high in some not high enough in other markets Standard Markup Pricing: price based on a percentage of cost but can cause problems in countries with high costs Price Escalation Problem: Apple faces this, must add the transportation, tariff, importer margin, etc and so its products are more expensive in some areas

generating new product ideas screening new product ideas

What are the first two stages of the new product development process?

Studying the target market

Which of the following actions should be taken to begin with the search for prospective middlemen?

Export Management Companies

Which of the following is a type of domestic middleman?

They assume trading risks

Which of the following statements is true regarding merchant middlemen?

new line

a new product category offered by the company

KFC sells Youtiao, a kind of Chinese doughnut, at its outlets in China. The Youtiao is considered an important part of a Chinese breakfast menu. In marketing terms, KFC is practicing a(n) _____ strategy.

adaptation

service barriers

barriers encountered by services in different markets, such as requirements for local certification, local producers, and other requirements that favor local over international services providers

What is a promotion mix (marketing communications mix)

blend of advertising, public relations, personal selling, and direct marketing tools that the company uses to persuasively communicate customer value and build customer relationships

private labels

brands sold under the brand name of a retailer or some other distributor

All of the following are specific objectives of sales promotion EXCEPT:

building brand loyalty.

trade shows and exhibitions

business-to-business promotions that usually are held annually in formats where companies purchase exhibit space to display and demonstrate their offerings to the target market.

buying offices

buyers representing different firms located abroad.

television shopping networks

cable channels that sell products to a television audience.

Which of the following countries has the largest number of retailers?

china

With respect to advertising, ________ is especially important when a budget is small or where there are severe production limitations.

creativity

hard currency

currency that is accepted for payment by any international seller.

soft currency

currency that is kept at a high artificial exchange rate, overvalued, and controlled by the national central bank.

In the context of international advertising, it has been observed that advertising expenditures are generally ________.

cyclical

________ in advertising is a thorny issue, because most member countries of the European Commission have different interpretations of what constitutes a misleading advertisement.

deception

During which step of the international communications process does the receiver of the message interpret symbolism transmitted from an information source?

decoding

In the international communications process, ________ is defined as the interpretation by the receiver of the symbolism transmitted from an information source.

decoding

Brand Positioning

define: marketers need to position their brands clearly in target customers' minds Lowest= product attributes Second=benefit Best= strong beliefs and values

Global Firm

define: operates in more than one country, gains marketing, production, R&D, and financial advantages not available to domestic competitors, sees the world as one market

The Price Elasticity of demand

define: sensitivity of demand to price inelastic: demand hardly changes with a small change in price elastic: demand changes greatly when price changes

greenfielding

developing a brand new subsidiary

The International trade systems- regional free trade zones

economic communities: groups of nations organized to work toward a common goals in regulating international trade, free trade zones European Union (EU):economic community, set out to create single european market, currently has 27 members -adoptions of common currency has caused problems as European economic powers such as Germany and France have had to step in recently to prop up weaker economies such as Greece and Portugal North American Free Trade Agreement (NAFTA): established free trade zone among the united states, mexico, and canada Central American Free Trade Association (CAFTA): established free trade zone between the U.S, Costa Rica, Dominican Republic, El Salvador, Guatamala, Honduras, and Nicaragua

Exchange Controls and Nontariff trade barriers

exhange controls: are a limit on the amount of foreign exchange and the exchange rate against other currencies nontariff barriers: are biases against bids or restrictive product standards that go against American product features (ex: business in China receive scrutiny and harsh treatment from authors aimed at boosting the fortunes of local competitors)

Cost as a function of production experience

experience curve (learning curve): the drop in the average cost with accumulated production experience a. downward-sloping experience curve: unit production falls. Price products low so sales will increase.

Which of the following steps of the international communications process is important as a check on the effectiveness of the other steps?

feedback

true

hard currency that is accepted for payment by any international seller

One of the reasons that channels of distribution often pose longevity problems is that most middlemen _____.

have little loyalty to their vendors

One of the reasons that channels of distribution often pose longevity problems is that most middlemen ________.

have little loyalty to their vendors

global consumers

homogeneous consumer group worldwide sharing similar interests and product/brand prefernces

The only way to avoid linguistic problems in advertising communication is by:

in-country testing with the target consumer group.

Which of the following is especially vulnerable as EU member states decide which area of regulation should apply to these services?

internet services

launching the product internationally

introducing a new product to the international market as the last step in the new product development process

According to Everett Rogers, the goals of the diffusion researcher and the marketer are to shorten the time lag between:

introduction of an idea or product and its widespread adoption.

trading companies

large companies that specialize providing intermediary services, risk reduction through extensive information channels, and significant financial assistance to manufacturing firms.

A disadvantage when using home-country middlemen as intermediaries in the distribution process is the:

limited control over the distribution process

specialized markets

markets that contain specialty stores specializing in a particular product category.

Which of the following elements of the international communications process comprises of external influences such as competitive advertising, other sales personnel, and confusion at the receiving end that can detract from the ultimate effectiveness of the communication?

noise

product depth

number of different offerings for a particular brand (all the detergent brands offered by a single mother corporation)

diffusion process

process by which a product is adopted by consumers worldwide

continuous innovation

product innovation where there is no disruption in consumption patterns; such innovations involve product alterations such as new flavors or new products that are improvements over the old offerings

An especially effective promotional tool when a product concept is new or has a very small market share is ________.

product sampling

Creating good relationships with the popular press and other media to help companies communicate messages to their publics—customers, the general public, and governmental regulators—is the role of _____.

public relations

company publications

public relations publications that describe the products of a company to potential customers and summarize financial achievements.

cross-border shopping

purchasing products from a neighboring country where the consumers may be charged lower duties.

warehouse clubs/ wholesale clubs

stores that require members to pay an annual fee operating in low-overhead, warehouse type facilities, offering limited lines of brand name and dealer-brand groceries, apparel, appliances, and other goods at a substantial discount.

globalization

the practice of global branding and localized marketing adaptation to differences in local culture, legislation, and even production capabilities

media reliability

the probability of the media to air advertising messages on time, at an acceptable quality, and with the agreed on frequency.

all-you-can-afford method

the process of allocating the maximum amount possible to advertising; the method is used by small and medium-sized corporations.

switch trading

the process of buying a party's position in a countertrade in exchange for hard currency and selling it to another customer.

standardization of the advertising strategy

the process of globalizing a company's promotional strategy so that it is uniform in all its target markets.

standardized pricing

uniform price worldwide.

regional standardization

use of a uniform marketing strategy within a particular region

outsourcing

use of outside resources to perform activities that are usually handles by internal staff and rsources

multilevel marketing/ network marketing

using acquaintance networks through an alternative distribution structure for the purpose of distribution.

network marketing

using acquaintance networks through an alternative distribution structure for the purpose of distribution; also called multilevel marketing.

piggybacking

using the distribution system of exporter with established systems of selling abroad who agree to handle the export function of a noncompeting (but not necessarily unrelated company on a contractual basis; also called mother henning and cooperative exporting.

cooperative exporting

using the distribution system of exporters with established systems of selling abroad who agree to handle the export function of a noncompeting (but not necessarily unrelated) company on a contractual basis; also called mother henning and piggy backing

Because a service is individually produced and is virtually unique, the service is said to have _____.

variability

In _____ pricing, the firm is concerned only with the marginal or incremental cost of producing goods to be sold in overseas markets.

variable-cost

which of the following is NOT an external economic or financial factor affecting pricing decisions? A. inflation pressure on price. B. shortage of hard currency. C. transfer pricing. D. fluctuation exchange rates.

In the context of media planning and analysis, billboards are especially useful in countries:

with high illiteracy rates

Due to their inherent entertainment value, satellite TV and the Internet have become major communications media in almost all nations.

FALSE Possibly because of their inherent entertainment value, radio and television have become major communications media in almost all nations.

In the context of distribution patterns, wholesaling shows a greater diversity in its structure than does retailing.

FALSE Retailing shows even greater diversity in its structure than does wholesaling.

Sales promotions are long-term IMC efforts directed to the consumer or retailer.

FALSE Sales promotions are short-term efforts directed to the consumer or retailer to achieve such specific objectives as consumer product trial or immediate purchase, consumer introduction to the store or brand, gaining retail point-of-purchase displays, encouraging stores to stock the product, and supporting and augmenting advertising and personal sales efforts.

Feedback channels must be carefully selected if an encoded message is to reach the consumer.

False

For most companies, trade shows and direct selling are the major components in the marketing communications mix.

False

In the context of international advertising, advertisers prefer global television (satellite broadcasts) due to the availability of accurate market data in most countries.

False

In the context of international advertising, an advertiser must consider local variations when choosing an appropriate medium.

False

Industrial advertisers rarely use direct mail for advertising.

False

International advertisers use foreign national consumer magazines extensively because they have dependable circulation figures.

False

Products from developing countries have the highest quality image.

False

Sales promotions are long-term IMC efforts directed to the consumer or retailer.

False

T or F? Contests, sweepstakes, and sponsorship of special events such as concerts are techniques used for maintaining and improving public relations.

False

T or F? Feedback channels must be carefully selected if an encoded message is to reach the consumer.

False

T or F? For most companies, trade shows and direct selling are the major components in the marketing communications mix.

False

Television is an advertising medium where there are no restrictions in most countries.

False

Uncontrollable and unpredictable influences such as competitive activities and confusion that detract from the process of communication are called feedback.

False

Feedback channels must be carefully selected if an encoded message is to reach the consumer.

Food retailers include which of the following? A. superstores. B. convenience stores. C. warehouse clubs. D. all of the above.

Competitor Analysis

Define: is the process of identifying, assessing, and selecting key competitors 2nd step: Developing competitive marketing strategies that strongly position the company against competitors

Traditional

In a _____ distribution structure, an importer controls a fixed supply of goods and the marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers.

False

In a traditional distribution structure, distribution systems are national rather than local in scope.

False

In an import-oriented distribution structure, supply often exceeds demand.

The budgeting decision that is mostly used by small medium-sized corporations' campaigns is the A. percent-of-sales method. B. executive-judgment method. C. competitive-parity method. D. all-you-can-afford method.

In the context of advertising, a marketer's self-reference criterion (SRC) affects the ultimate success of the communication.

True

In the context of international advertising, search engines have now become crucial directors of Internet users' attention.

True

Of all the elements of the marketing mix, decisions involving advertising are those most often affected by cultural differences among country markets.

True

One of the drawbacks of satellites is also their strength, that is, their ability to span a wide geographical region covering many different cultures

True

Problems of literacy, media availability and types of media create problems in the international communications process at the encoding step.

True

Sales promotions are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.

True

Sales promotions constitute the major portion of the promotional effort in rural and less accessible parts of a market.

True

T or F? A reason for the failure of marketing communications is that the message received by the intended audience is not understood because of different cultural interpretations.

True

T or F? Errors at the receiver end of the international communications process can be avoided if the message is encoded properly.

True

T or F? In the context of advertising, a marketer's self-reference criterion (SRC) affects the ultimate success of the communication.

True

T or F? In the context of international advertising, search engines have now become crucial directors of Internet users' attention.

True

T or F? One of the drawbacks of satellites is also their strength, that is, their ability to span a wide geographical region covering many different cultures.

True

T or F? Sales promotions are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.

True

T or F? Sales promotions constitute the major portion of the promotional effort in rural and less accessible parts of a market

True

T or F? The role of public relations is to create good relationships with the popular press and other media to help companies communicate messages to their publics—customers, the general public, and governmental regulators.

True

T or F? While developing an international advertisement campaign, the last step of the process is evaluating the campaign relative to the goals specified

True

The feedback step of the international communications process is important as a check on the effectiveness of the other steps.

True

While developing an international advertisement campaign, the last step of the process is evaluating the campaign relative to the goals specified.

True

the use of an uniform marketing strategy within a particular region

What is regional standardization and why has it become more preferable to companies in recent years?

With Direct exporting, companies handle their own exports. With Indirect exporting, companies sell their product to someone else who then ships it overseas

What is the biggest difference in indirect and direct exporting?

country of origin is where the product is associated and the country of manufacture is where it is manufactured

What is the difference between "country of origin" and "country of manufacture"? Can these ever be one and the same?

simulated test: simulate purchase environment where samples of target consumers are observed in their product related decision-making process. controlled test: offering a new product to a group of stores and evaluating the markets reaction to it.

What is the difference between a simulated test market, controlled test market, and actual test market?

length is the total number of brands in the mix width is the total number of product lines the company offers to its target international consumers and depth is the total number of different offerings in a product line.

What is the difference between product length, product width, and product depth?

Subsidiaries are separate entities, whereas branch offices are entities that are part of the international company wholly owned subsidiary because a nationalization attempt on the part of the local government could leave the company with just a tax write-off.

What is the difference in a wholly owned subsidiary and a branch office? Which is considered riskier? Why?

market-based transfer pricing

a pricing strategy used intra-firm sales for commercial transactions between units of the same corporation, within or beyond the national borders of the parent company, whereby products are priced at market cost, rather than at the cost incurred by the company.

It includes transportation mode, inventory quantities, and packing.

Which of the following is true of a physical distribution system?

They can function as a principal or a commissioned agent.

Which of the following is true of foreign sales corporations?

It includes buying and selling negotiations.

Which of the following is true of the distribution process?

Direct sales force

Which of the following modes of distribution affords the most control over the distribution channels but often at a cost that is not practical?

Which of the following refers to interference in the communication process attributed to cultural differences, competing messages, and degree of consumer interest? A. encoding. B. decoding. C. noise. D. none of the above.

historical method

an approach to budgeting that is based on past expenditures, usually giving more weight to more recent expenditures.

Norazi agent

an export agent dealing in illegal and gray market products.

indirect exporting

an export entry mode whereby a company sells its products in the company's home country to intermediaries who, in turn, sell the product overseas.

direct exporting

an export entry mode whereby a firm handles its own exports, usually with the help of an in- house exporting department.

licensing

an international entry mode that involves a licensor, who share the brand name technology, and know- how with a licensee in return for royalties.

publicity

any communication about a company and the company's products that the company does not pay for; may be positive or negative.

The marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers.

Which of the following statements is true of a traditional distribution structure?

The Japanese distribution structure supports long-term dealer-supplier relationships.

Which of the following statements is true of the Japanese market?

They work on commission and arrange for sales in the foreign country.

Which of the following statements is true regarding agent middlemen?

It calls for a minimum investment from the parent firm to get into international markets.

Which of the following statements is true regarding an export management company (EMC)?

The importer-wholesaler traditionally performs most of the marketing functions.

Which of the following statements is true regarding an import-oriented distribution structure?

True

While developing an international advertisement campaign, the last step of the process is evaluating the campaign relative to the goals specified.

product- country stereotypes

associate the country of origin as a certification of quality Example: Swiss chocolate, German automotive engineering

Webb- Phomerene Associations

associations of competing companies that are granted immunity from antitrust prosecution and that join resources and efforts to export internationally.

One approach to defining the pricing policy of dumping is to say that it is a case where a product is sold in the international market:

at a price below the cost of production.

Of the seven steps involved in international advertising, ________ almost always represents the most daunting task for international marketing managers.

developing messages

designing and developing the product

developing product prototypes and giving the product a name, brand identity, and a marketing mix. A step in the new product development cycle

merchant middlemen

different intermediaries who carry the manufacturer's product line in a particular country; they both carry title to and have physical possession of the products they distribute.

In the context of the use of the Internet in international marketing channels, technically, e-commerce is a form of ________ selling

direct

________ is often the approach of choice in markets with insufficient or underdeveloped distribution systems.

direct marketing

logistics alliances

distribution alliance between two firms involving product transportation and warehousing.

international public relations

a concerted effort on the part of a company to generate goodwill among international publics that are essential to the company; its main purpose is to generate positive publicity about the company.

joint venture

a corporate entity created with the participation of two companies that share equity, capital, and labor.

Due to differences in culture in different markets, standardized products that are marketed globally will most likely require:

a different advertising appeal.

Due to differences in culture in different markets, standardized products that are marketed globally will require:

a different advertising appeal.

established channels

distribution channels that already exist in a particular market

Home-country middlemen are also known as ________ middlemen.

domestic

true

dumping is defined as selling products at cost to get rid of excess inventory and to undermine competition.

true

dumping represents a problem if it threatens to cause injury to an established industry in a particular market and if it delays the establishment of a viable domestic industry.

countervailing duties

duties imposed on subsidized products imported into a country.

antidumping duties

duties that must be paid by firms as a punishment for engaging in unfair price competition.

parallel imports

a distribution system not authorized by the manufacturer whereby the products purchased in a low- price market are diverted to other markets; also called gray market.

parallel imports/ gray market

a distribution system not authorized by the manufacturer whereby the products purchased in a low-price market are diverted to other markets.

managing agent

a foreign agent who has an exclusive arrangement with a company, representing its operations in a particular country.

comprador

a foreign agent with an exclusive arrangement with a company, representing its operations in a particular country; also referred to as a managing agent.

parallel barter/ counterpurchase

a form of trade that involves two exchanges that are paid for in cash; it involves two parallel contracts whereby the seller agrees to purchase products that are usually unrelated to its business from the buyer and sell them on international markets.

countertrade

a form of trade whereby a company sells a product to a buyer and agrees to accept, in return for payment, products from the buyer's firm or from the trade agency/institution of the buyer.

sogo- shosha

a large Japanese trading company that specializes i providing intermediary services, risk reduction through extensive information channels, and significant financial assistance to manufacturing firms.

offset purchase

a large, hard-currency purchase, such as the purchase of defense equipment, airplanes, telecommunications networks, railway or road building, and other expensive civil engineering projects whereby the seller agrees, in return, to purchase products that are valued at a certain percentage of sale.

a manufacturer may charge different prices in different markets for the same product. A. to meet target market needs. B. due to changes in the exchange rate. C. due to differences in wholesale prices. D. all of the above.

import jobber

a merchant intermediary who purchases commodity goods from the manufacturer to sell to the trade(wholesaler, retailer, business-to-business client) in the target market.

new item in an existing product line

a new brand that the company offers to the market in an existing product line

new product to existing company

a new product that the company offers to the market. The product competes with similar competitor offerings

manufacturing alliance

a nonequity relationship between 2 firms in which one firm handles the others manufacturing or some aspect of the manufacturing process

marketing alliance

a nonequity relationship between 2 firms in which one firm handles the others marketing or some aspect of the marketing process

distribution alliance

a nonequity relationship between two firms in which one firm handles the others distribution or some aspect of the distribution process

print medium

a nonpersonal channel of communication such as a newspaper, magazine, billboard, pamphlet, or point of-purchase display.

interactive medium

a nonpersonal channel of communication such as a web page or a computer terminal on the retailer's premises.

broadcast medium

a nonpersonal channel of communication such as television or radio.

telemarketing

a personal channel of communication that involves a sales person calling on consumers.

local pricing

a pricing strategy in which different prices are charged in different markets, reflecting different markets, reflecting differences in consumer purchase power, distribution costs, tax systems, or other market traits.

cost-based transfer pricing

a pricing strategy used in intera-firm sales for commercial transactions between units of the same corporation, within or beyond the national borders of the parent company, where the costs reflect the estimated opportunity costs of the product.

In the international communications process, during ________, the message from the source is converted into effective symbolism for transmission to a receiver.

encoding

encoding of the message

Whats the percentage of new products that fail for established companies? Start-up companies?

established companies: 67% start-up companies: 90%

A major disadvantage of ________ is that they can seldom afford to make the kind of market investment needed to establish deep distribution for products.

export management companies

degree of product/ service newness

extent to which a product is new to the market in general or to a group on consumers

The ________ step in the international communications process refers to the information about the effectiveness of the message that flows from the receiver (the intended target) back to the information source for evaluation of the effectiveness of the process.

feedback

The channel process includes all activities, beginning with the manufacturer and ending with the ________.

final consumer

complementary export agents

firms that export other firms' products that are complementary to their offerings, along with their own products, for a fee/ commission.

A(n) ________ is a domestic middleman set up in a foreign country or U.S. possession that can obtain a corporate tax exemption on a portion of the earnings generated by the sale or lease of export property

foreign sales corporation

In the context of the types of domestic middlemen, the WTO in 2003 ruled ________ to be in violation of international trade rules, thus starting a major trade dispute with the European Union.

foreign sales corporations

all-purpose discount stores

general merchandise discount stores that offer a wide variety of merchandise and limited depth

false

global branding creates different images for the product in the different regions where the product is sold.

late majority

individuals of limited means who are likely to adopt products only if the products are widely popular and the risk associated with buying them is minimal. They account for 34% of the total market

feedback

information regarding the effectiveness of a company's message.

In the international communications process, an international marketing executive with a product message to communicate specifically acts as a(n) ________.

information source

In the international communications process, the sales force of a company that conveys the encoded content to the intended receiver acts as a(n) ________.

message channel

In the context of the communication process in advertising, using the Internet as a medium when only a small percentage of an intended market has access to it is an example of an error related to:

message channel selection

press releases

statements issued to the press to communicate news about a company and its products.

news releases

statements issued to the public to introduce a new product, touting its advantages; any other information shared with the media.

incoterms

terms of sale used in transactions.

simulated test marketing

test marketing simulating purchase environments where samples of target consumers are obsevred in their product related decision making process

controlled test marketing

test marketing that involves offering a new product to a group of stores and evaluating the markets reaction to it

test marketing

testing new product performance in a limited area of a national or regional target market to estimate product performance in the respective country or region

E-commerce is more developed in ________ than the rest of the world, partly because of the lower cost of access to the Internet than found elsewhere.

the United States

adaptation of the advertising strategy

the act of changing a company's promotional mix to each country or market or creating local campaigns.

mandatory adaptation

the adaptation of products to local requirements so that the products can legally and physically function in the specific country environment

clearing currency

the agreed-on currency used to pay swing credits in a clearing account or agreement.

modification

the alteration of an existing company product

entry mode

the approach to international expansion a company chooses based on desired control and on the risk it can afford.

ethnocentrism

the belief that ones culture is superior to another and that strategies used in ones home country will work just as well internationally

medium/ media

the channels(s) of communication that a company uses to send to the target consumer a message about its product or service.

international communication process

the communication process that takes place between the product sponsor and the international target market.

product mix

the complete assortment of products that a company offers to its target international consumers

country of manufacture

the country in which a particular product is manufactured

country of origin

the country with which a particular product or service is associated

New Product Development Define

the development of original products, product improvements, product modifications, and new brands through the firms own product development

transfer pricing

a pricing strategy used in intra-firm sales for commercial transactions between units of the same corporation, within or beyond the national borders of the parent company.

television home shopping

retailing through cable channels selling to consumers in their homes, through infomercials, and through direct response advertising shown on broadcast and cable television.

direct mail retailing

retailing using catalogs and other direct mail, instead of brick-and-mortar stores.

In the context of international advertising, companies are moving from the commission system to a ________ system.

reward-by-results

In-store demonstrations, samples, coupons, contests, and sweepstakes are examples of ________ devices.

sales promotions

In the context of controlling middlemen, parallel importing is also known as ________.

secondary wholesaling

generating new product ideas

seeking ideas using different strategies as the first step in the new product development process

conventional supermarkets

self-service food retailers with annual sales of more than $2 million and with an area less than 20,000 square feet.

brand name counterfeiting

selling counterfeit products as brand name originals

dumping

selling products below cost to get rid of excess inventory and to undermine competition.

direct selling

selling that involves a salesperson, typically an independent distributor, contacting a consumer at a convenient location- at his or her home or workplace, demonstrating product use and benefits, taking orders, and delivering the merchandise.

internet retailing

selling through the internet using web sites to increase market penetration and market diversification; also called interactive home shopping and electronic retailing.

electronic retailing

selling through the internet using web sites to increase market penetration and market diversification; also called interactive home shopping and internet retailing.

catalog showrooms

showrooms displaying the products of catalog retailers, offering high turnover, brand name goods at discount prices.

mother henning

sing the distribution system of exporter with established systems of selling abroad who agree to handle the export function of a noncompeting (but not necessarily unrelated company on a contractual basis; also called piggybacking and cooperative exporting.

convenience stores

small retailers located in residential areas, open long hours, and carrying limited lines of high-turnover necessities.

________ are considered to be the foundation of the Japanese distribution system.

smaller retailers

Blogs, virtual worlds, and video sharing are examples of media commonly known as ________.

social media

In the context of cultural reactions when engaging in e-commerce, the color red is associated with socialism in ________.

spain

In the context of distribution patterns, the rate of change in retailing around the world appears to be directly related to the ________.

speed of economic development

sales promotion

sponsored communications to the target consumer or trade segment that stimulate purchases or improve relationships with intermediaries.

_____ might be classified as an aspect of sales promotions or public relations, though their connections to advertising are also manifest.

C. Road Shows

T or F? In the context of international advertising, an advertiser should ideally exclude availability, cost, and coverage of media.

False

T or F? Uncontrollable and unpredictable influences such as competitive activities and confusion that detract from the process of communication are called feedback.

False

T or F? When a marketing executive advertises his product in a newspaper, the newspaper acts as a feedback channel.

False

T or F? When a message from a source is converted into effective symbolism for transmission to a receiver, the message is said to have been decoded.

False

T or F? With some exceptions, usually a majority of the population of less developed countries can be reached readily through the traditional mass medium of advertising.

False

When a marketing executive advertises his product in a newspaper, the newspaper acts as a feedback channel.

False

When a message from the source is converted into effective symbolism for transmission to a receiver, the message is said to have been decoded.

False

the functions performed by middlemen

In the context of factors affecting choice of channels, one of the key elements in distribution decisions includes _____.

False

In the context of international advertising, advertisers prefer global television (satellite broadcasts) due to the availability of accurate market data in most countries.

False

In the context of international advertising, an advertiser must consider local variations when choosing an appropriate medium.

True

In the context of international advertising, search engines have now become crucial directors of Internet users' attention.

True

In the context of retail patterns, direct marketing works well in affluent markets as well as in markets with underdeveloped distribution systems.

Direct

In the context of the Internet in international marketing channels, technically, e-commerce is a form of _____ selling.

Which of the following is an example of the primary function of a product?

The ability of a camera to take a picture

To remove antitrust disincentives to export activities.

Which of the following was a goal of the Export Trading Company Act?

Of all the elements of the marketing mix, decisions involving which of the following is most often affected by cultural differences among country markets?

advertisement of the product

media restrictions

legal or self-imposed restrictions on the types and the number of advertisements aired or published.

combination stores

medium-sized retail stores that combine food and drug retailing.

event sponsorship

the financial support of cultural or sports-related events; companies use these events to get positive publicity.

encoding

the process whereby the advertiser puts the company's message about the product into words and images that are aimed at the target consumer.

decoding

the process whereby the target consumer receives the message from the advertiser and translates it into meaningful information.

Building Equity

*brands=powerful assets!!! 1. Brand Equity: differential effect that knowing the brand name has on customer response a. Positive Brand equity: consumers react more favorable to it then generic or unbranded products b. Negative brand equity: consumers react less favorably than to an unbranded version

Personal Selling Extra facts

- 63% of all companies pay combo of commission and base salary (33% of salary is their commission) -personal selling is the most important part of the process -follow-up is the most overlooked step

specialty stores

Retailers that offer a narrow product line and wide assortment

Defining Rural Distribution

•Depending upon the product, customer and operating environment, a rural distribution channel must demonstrate one or more of the following nine capabilities: 1.) Physical Distribution •Transportation, storage, etc 2.) Promotion •Capability to develop powerful messages 3.) Credit and Financing •Access to alternative source of capital 4.) Post Sales Service •Ability to execute repair/fulfillment 5.) Information •Access to primary and secondary information 6.) Contact •Regular outreach with target customers 7.) Matching •Ability to understand different needs of various customer segments 8.) Negotiation •Knowledge of end customers product alts. 9.) Risk-Taking •Ability to understand PLCs and customer purchasing patterns

Overall Advertising Objective

- help move consumers through the buying process -building or strengthening long-term customer relationships

Too Few Social Goods

- business oversell private goods at the expense of public goods and require more public goods to support them=lots of social costs Response: needs to be balance between private and public goods. Producers should bear full social costs of their operations and pay social costs of their purchases.

Direct Response Television

-60-120 secs advertisements that describe products or give customers a toll-free number or website to purchase -30 min info commercials -less expensive than other forms and easier to track results -DRTV: more associated with somewhat questionable pitches for cleaners, stain removers, etc (sham wow, as seen on TV, etc) -Interactive TV (iTV): lets viewers interact with TV programming and advertising

General Agreements on Tariffs and Trade (GATT)

-61 year old treaty -designed to promote world trade -reduces tariffs and other inter nation trade barriers -World Trade Organization (WTO) replaced GATT now oversees GATT rules, mediates disputes, and imposes trade sanctions

Recruiting and Selecting Salespeople Issues in Recruiting and Selecting

-Careful selection and training increases sales performance -Poor selection increases recruiting and training costs, lost sales and disrupts customer relationships -top 30% of the company brings in about 60% of their sales -Consulting Gallup: interviewed thousands of salespeople and found that the best salespeople possess 4 key talents: intrinsic motivation, disciplined work style, ability to close a sale, and ability to build relationships with customers

Political-Legal Environment

-Countries attitude toward international buying: some have more limitations -government bureaucracy -political stability -monetary regulations: sellers want to take profits in the form of currency. Sellers might except a blocked currency which is when their profit is restricted so they have to buy good in the country that they need or can elsewhere for needed currency. Barter involves the direct exchange for goods and services.

Deciding which Markets to Enter

-Define international marketing objectives and policies -foreign sales volume -how many countries to market to -types of countries to market to based on a. geography b. income and population c. political climate -Rank potential global markets based on a. market size b. market growth c. cost of doing business d. competitive advantage e. risk level

Micro Distribution Centers (MDC's) in Africa

-MDCs are mainly independently owned, low-cost businesses -The MDC model identifies and engages independent entrepreneurs, who receive business training and in some situations financing, to become an MDC owner. -The majority of MDC owners have a minimum of primary school education and have previously been employed or were in school before becoming an owner. -Have the potential to grow a business, employ others, raise productivity, and increase incomes on a sustained basis.

What is PRIZM?

-PRIZM: leading segmentation systems -classifies every American household based on a host of demographic factors (ex: age, education,, etc). Organizes them into 14 different social groups and like-minded groups. Helps companies identify and better understand key customer segments.

Planned Obsolescence

-Planned Obsolescense: causing their products to become obsolete before they actually need replacement -Perceieved Obsolescnce: changing consumer concepts of acceptable styles to encourage more or earlier buying Response: 1. Planned Obs. is really the result of competitive market forces leading to always improving goods and services 2. Customer like style changes and war the latest innovations

Steps in Developing Effective Marketing Communication-Selecting the Message Source

-The message's impact on the target audience is affected by how the audience views the communicator 1. Celebrities (athletes,entertainers) 2. Professionals (health care providers) - highly credible sources=more persuasive -have to be careful when selecting celebrities to represent brand because can result in embarrassment and tarnished image

False Wants and Too much Materialism

-accused the marketing system urges too much interest in material possessions Response: - people do have strong defenses and against advertising. Marketers are most powerful when they appeal to exhisiting wants rather than creating new ones

Balencing Customer and Compeitor Orientations

-companies need to continuously adapt strategies to changes in the competitive environment 1. Competitor-centered company: spends most of its time tracking competitors movies . Advantages= company is a fighter Disadvatages=bases moves on competitors moves not customers 2.customer-centered company: spends most of its time focusing on customer needs -better than competitor centered company 3.market-centered company: spends most of its time focusing on both competitor and customer developing (customer centerered) NO Yes NO Product orientation customer orien Yes competitor orient market orientat (competitor centered)

Deceptive Practices

-complain that companies use deceptive practices that lead customers to believe they will get more value than they actually do 1. Deceptive Pricing:false advertising "factory" or "wholesale" prices 2. Deceptive Promotion: misrepresenting the products features or performance 3. Deceptive Packaging: exaggerating package contents through design, labeling, or describing misleading size Response: 1. Support legislation to protect consumers from deceptive practices ex: Wheeler-Lee CAt: gave Federal Trade commission power to regulate unfair or deceptive acts or practices

High Pressure Selling

-complaint that salespeople use high pressure selling that persuade people to buy goods they had no intention of buying Response: most salespeople are trained to build good relationships not to pressure buyers.

Selling and the Internet

-fastest growing sales tool is the internet -68% of people are investing more in Social media -Internet can help with training, sales meetings, live sales presentations, and servicing accounts -drawbacks: expensive, intimidate low-tech salespeople or clients, some things you simply can't present or teach via internet

Types of Websites

1. Corporate website: designed to build customer goodwill and to supplement other channels, rather than to sell the company's products directly to: -provide information -create excitement -build relationships 2. Marketing Website:designed to engage consumers in interaction that will move them closer to a direct purchase or other marketing outcome

The characteristics of a service

1. Service Intangibility: service can't be seen, tasted, felt, heard, or smelled before they're bought 2. Service Inseperability: service can't separated from its providers 3. Service Variability: quality of the services depends on who provides them as well as when and how they are provided 4. Service Perishability: services can't be stored for later use or sale

The Integrated Marketing Communications (IMC) Process

-first identity the target audience (because customers differ), determine communication objectives, design the message, choose the media, and select message source -Many times marketing communication focus on immediate awareness, image, or preference goals in the target market but this is too shortsighted today marketers are viewing communications as managing customer relations over time 1. Sender: party sending message to other party 2. Encoding: process of putting thought into symbolic form 3. Message: set of symbols the sender transmits 4. Media: communications channels through which the message moves 5. Decoding: process which the receiver assigns meaning to symbols 6. Receiver: parting receiving the message 7. Response: reaction of the receiver after being exposed to message 8. Feedback: part of the receivers response communicated back to the sender 9. Noise: unplanned static or distortion during the communication process which results in the receiver's getting a different message than the one the sender sent

Additional Product and Service Consideration

-government can prevent companies from adding products if the event threatens to lessen competitors -companies dropping products must be aware that they have legal obligations, written or implied, to their suppliers, dealers, and customers -Manufacturers must comply with specific laws regarding product quality and safety-- The Federal Food Drug and Cosmetic Act: protects consumers from unsafe and adulterer food, drugs, and cosmetics -Consumer Product Safety Act: established the consumer product safety commission which has the authority to ban or seize potentially harmful products and set severe penalties for violation of law -International Product and services: figure out what products and service to introduce and in which countries. They must decide how much to standardize or adapt their products and services for world markets.

Steps in Developing Effective Marketing Communication-collecting feedback

-involves the communicator understanding the effect on the target audience by measuring behavior resulting from the behavior

Using Email

-marketers are developing enriched messages that include animation, interactivity, and personal messages with streaming audio and video to compete with the cluttered email environment -lets marketers send highly targeted, personalized relationship building messages -downsides: spam, unwanted commercialized messages, and permission-based marketing allows users to opt in or out of email marketing

Cultural Pollution

-marketing and advertising create cultural pollution response: -planned to reach only target audience and advertising makes radio and TV free to users and helps keep down costs. people also have alternatives to advertising.

Direct Marketing

-no intermediaries -fastest growing form of marketing

Kiosk Marketing and other Digital Direct marketing technologies

-placing these in stores, airports, hotels, colleges, etc -ex: Kodak, Redbox -Zoomshop Kiosk: small, free standing kiosk for retailers like Apple, Sephora, the Body Shop, etc and consumers can purchase these items right at the kiosk Other technologies include: mobile phone marketing, podcasts, vodcasts, interactive TV

Michael Treacy and Fred Wiersema

-suggest that company can gain leadership positions be delivering superior value to their customers in their strategies or value disciplines 1. operational excellence: refers to a company providing value by leading its industry in price and convenience by reducing costs and creating a lean and efficient value delivery system 2. customer intimacy: company providing superior value by segmenting marketing and tailoring products or services to match the needs of targeted customers 3. product leadership: offering continuous stream of leading-edge products or services, product leaders open to new ideas and solutions and bring them quickly to the market

Creating the Advertising Message- Consumer Generated Messages

-taking advantage of today's interactive technologies, many companies now tapping consumers for message ideas or actual ads 1. Youtube Videos 2. Brand Website Contests Positives: a. low expense b. New creative ideas c. Fresh perspective on brand d. Boost consumer involvement

Cultural Environment

-the need to adapt to local cultural values and traditions rather than imposing their own -ex: IKEA captures about 7% of the China home-furnishing market, sales increased 20% last year -ex: in China nearly half of all children identify Mcdonalds as a domestic brand

Marketing Impact on Other Businesses

1. Acquisition of Competitors 2. Creating barriers to entry 3. unfair competitive marketing practices

Promotion Mix (stuff included)

1. Advertising: any paid form of non personal presentation and promotion of ideas, goods, or services by an identified sponsor (ex: broadcast, print, internet, outdoor) 2. Sales Promotion: short term incentive to encourage the purchase or sale of a product or service (ex: discounts, coupons, displays, demonstrations) 3. Personal Selling: personal presentation by the firm's sales force for the purpose of making sales and building customer relationships (ex: sales presentations, trade shows, incentive programs) 4. Public Relations: involves building good relations with the company's various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events (ex: press releases, sponsorships, special events, web pages) 5. Direct Marketing: involves making direct connections with carefully targeting individual consumers to both obtain an immediate response and cultivate lasting customer relationships- through the use of direct mail, telephone, direct-response T.V, email, and the internet to communicate directly with specific consumers (ex: catalog, telemarketing, kiosks)

Brand Development

1. Line Extensions: occurs when a company extends existing brand names to new forms, colors, sizes, ingredients, or flavors (ex: Cheerios lines) 2. Brand Extensions: extends current brand name to new modified products in a new category (ex: kellogs extended from cereal to breakfast bars, shakes, protein waters, etc) 3. Multibrands: companies often market many different brands in a given product category (ex: pepsico) 4. New Brands: companies create new brand when they believe that the power of its exhisting brand name is waning ex: Toyota created Lexus for more luxury consumers

department stores

General retailers that offer a broad variety of goods and wide assortments

Setting the Total Promotion Budget and Mix- Shapping the Overall Promotion Mix , The Nature of Each Promotion Tool

1. Advertising: reaches masses of geographically dispersed buyers at a low cost exposure, enables seller to repeat a message many times, but is impersonal and one-way communication, can be costly 2. Personal Selling: most effective method at certain stages of the buying process, particularly in building buyers' preferences, convictions, actions, and developing customer relationships. However it is the most costly tool. 3. Sales Promotion: includes coupons, contests, cents-off-deals, and premiums that attract consumer attention and offer strong incentives to purchase, and can be used to dramatize products offers and to boost sagging sales. Not as effective as building relationships and brand preference. 4. Public Relations: very believable form of promotion that includes news stories, features, sponsorships, and events, can reach many prospects who avoid salespeople and advertisements, get to customers as "news" rather than sales-directed communication. Can help dramatize a product or company. 5. Direct Marketing: less public, message directed at specific person, immediate and customized. its interactive and is well suited when building one-to-one customer relationships.

Setting the Total Promotion Budget and Mix -Affordable Budget Method

1. Affordable Budget Method: sets the budget at an affordable level and ignores the effects of promotion on sales. Small business often use this method. This method tends to place promotion last among spending priorities. Most of the time results in underspending.

Product and Service decisions (continued)

1. Branding : is a name, term, sign, symbol, or design, or combination of these that identifies the maker or seller of a product or service -helps consumers identify products that might benefit them, say something about product quality and consistency 2. Packaging: involves designing and producing the container or wrapper for a product 3. Labeling: ranges from simple tags attached to products to complex graphics that are part of the packaging -identify the product/brand, might describe the product, help to promote the brand 4. Product Support Services: customer service is another element or product strategy -ex: email, internet, and interactive voice and data technologies is used to provide support services 5. Product Line: A group of products that are closely related because they function in a similar manner or sold to same customer groups a. Product line length: number items in the product line b. line filling: adding more items within the present range of the line c. Product Line stretching: company lengthens its product line beyond its current range downward, upward, or both ways 6. Product Mix: The set of all product lines and items that a particular seller offers -important dimensions: width, length, depth, and consistency

Online Marketing Domains

1. Business to Consumer (B2C): involves selling goods and services online to final consumers 2. Business to Business (B2B): involves selling goods and services,providing information online to businesses, and building customer relationships 3. Consumer to Consumer (C2C): occurs on the web between interested parties over a wide range of products and subjects -Blogs: offer fresh, original, and inexpensive ways to reach audiences but they are difficult to control) 4. Consumer to Business (C2B): involves consumers communicating with companies to send suggestions ad questions via company websites

A need for Action

1. Can Spam: government agencies are investigating do not call, email, lists and Can Spam legislation. government has considered numerous legislative actions how marketers obtain information. -have agreed to let consumers know when their information is being tracked by the symbol of a little "i" inside a triangle 2. California Online Privacy Protection Act (OPPA) 3. Children's Online Privacy Protection Act (COPPA): requires online operators targeting children to post privacy policies on their website and must notify parents if they are gathering any information about the child. 4. TRUSTe: nonprofit, self-regultary organization works with many large corporate sponsors to audit privacy and security measures and help consumers navigate the internet safely

Place decisions and types of store

1. Central Business districts: located in cities and include department and specialty stores, banks, and movie theaters 2. Shopping centers: group of retail businesses planned, developed, owner, and managed as a unit

Socially Responsible Marketing Communication

1. Communicate openly and honestly with consumers and resellers 2. Avoid false advertising 3. Avoid bait-and-switch advertising: advertise lower price but then with certain conditions they are at higher price or convinced to buy another higher prices product 4. Conform to all state and federal regulations -ex: under Robinson-Patman Act: sellers can't favor certain customers through their use of trade promotions. They must make their promotions available to all resellers on equal terms. -Federal Trade Commision (FTC) adopted the "three day cooling off rule": customers who agree in their own homes, workplace, dormitory, etc to buy something costs more than $25 they have 72 hours to cancel or return item and get money back 5.Follow rules of "fair competition" 6. Don't offer bribes 7. Don't attempt to get competitors trade secrets 8. dont disparate competitors of their products

Product and Service Classifications

1. Consumer Products: Products and services bought by final consumers for personal consumption a. Convenience Product: product consumers buy frequently, immediately, minimal comparison b. Shopping Product: when shopping consumers usually compare on such attributes such as suitability, quality, price, and style c. Specialty Products: product with unique characteristics and brand indentifaction , willing to make special purchase effort d. Unsought Product: product that the consumer doesnt know about or doesnt normally consider buying 2. Industrial Product: bought by individuals and organizations for further processing or for use in conducting a business a. Materials and Parts: include raw materials, manufactured materials and parts b. Capital Items: products that aid in the production or operations c. Supplies and Services: operating supplies,repair and maintenance items

Benefits of Direct Marketing to Buyers

1. Convenience 2. Ready access to many products 3. access to comparative information about companies, products, and competitors 4. interactive and immediate (buyers can interact with sellers by phone, website, etc and gives consumers a great measure of control)

What are the 3 levels of products

1. Core Customer value: address what the buyer is really buying 2. Actual Product:have to develop product and service features. design, quality level, brand name, and packaging 3. Augmented Product: benefits of actual owning this product, do this by offering additional consumer services and features, create customer value and the most satisfying brand experience

What are the major pricing strategies?

1. Customer Value-based pricing: uses buyers' perceptions of value as the key to pricing. Price is considered along with all other marketing mix variables before the marketing program is set. a. Good-Value Pricing: offering the right combination of quality and good service at a fair price b. Value-added Pricing: attaching value-added features and services and charging higher prices 2. Cost-based pricing: involves setting prices based on the costs of producing, distributing, and selling the product plus fair rate of return for its effort and risk a. Cost-Plus Pricing: adding a standard markup to the cost of a product (ex: construction companies submit job bids by estimated the total project cost and adding standard markup for profit) b. Break-Even analysis and target profit pricing: firm tries to determine the price at which it will break even or make the target return it its seeking (total revenue=total costs) 3. Competition-Based pricing: involves setting prices based on competitors' strategies, costs, prices, and market offerings

Managing New Product Development

1. Customer-centered new product development: new- product development that focuses on finding new ways to solve customer problems and create more customer satisfying experience 2. Team- Based new-product development: development in which various company department work closely together, overlapping the steps in the product development process to save time and increase effectiveness (departments like marketing, finance, design, manufacturing, legal departments, etc.). Assemble a team from various departments that stays with new product from start to finish. If bottleneck happens then the team can go on except that one specific problem will only be focused on by that specific team member) 3. Systemic Approach: new product development should be holistic and systemic rather than compartmentalized and haphazard 4. Turbulent: when tough economic times hit, or when company faces financial difficulties, management may want to reduce spending on new-product development. Such thinking is not good because by making less products the company makes itself less competitive .Tough times call for even greater new product development and innovation helps rather than hurts!

Product Life Cycle (PLC) Strategy

1. Development Stages: begins when company finds and develops a new-product idea. Sales are zero and companies investment costs mount. 2. Introduction stage: period of slow sales growth as the product is introduced in the market. Profits are non-exhistant because of heavy expenses of product introduction 3. Growth Stage:period of rapid market acceptance and increasing profits 4. Maturity Stage: period of slowdown in sales growth because product has achieved its acceptance. Profit levels off or declines 5. Decline Stage: period when sales fall off and profits drop PLC can describe: 1. Style: basic and distinctive mode of expression 2. Fashion: currently accepted or popular style in given field 3. Fad: temporary periods of unusually high sales driven by consumers

Number of channel levels

1. Direct marketing channel: marketing channel that has no intermediary levels 2. Indirect Marketing channel: a marketing channel containing one or more intermediary levels

Forms of online advertising

1. Display ads: appear anywhere on website and might relate to information being used 2. Search-related ads: ads in which text-based ads and links appear alongside search engine results on sites such as Google and Yahoo and are effective in linking consumers to other forms of online promotion. Largest form of online advertising which account for 46.5% of all online advertising spending each year. 3. Online Classified 4. Banners: banner shaped ads found on website 5. Interstitials: ads that appear between screen changes 6. Rich Media Ads: incorporate animation, video, sound, and interactivity 7. Content Sponsorship: provides companies with name exposure through sponsorship of special content such as news or financial information 8. Viral Marketing: internet version of word-of-mouth marketing and involves the creation of a website, email message, or other marketing event that customers pass along to friends

What are the types of costs?

1. Fixed (overhead): costs that do not vary with production or sales levels (ex: rent, heat, salaries, etc.) 2. Variable: costs that vary directly with the level of production 3. Total Costs: sum of the fixed costs+variable costs

Salesperson Compensation Based On

1. Fixed income 2. Variable Amounts 3. Expenses 4. Fringe Benefits - more companies are moving away from high commission plans that many drive salespeople to make short term grabs for business. Pushing too hard to close the deal many ruin the customer relationship. -Instead companies are designing compensation plans that reward sales people for building customer relationships and growing the long-run value of each customer -Companies are looking for ways to shorten administrative duties, using phone, email, and internet instead of traveling, and developing better sales-call and routing plans to save time and work more

Marketing Impact on individual consumers

1. High prices: high costs of distribution, high advertising, promotion costs, and excessive markups 2. Deceptive practices 3. high-pressure selling 4. harmful, unsafe products 5. planned obsolescence 6. poor service to disadvantaged consumers

Positioning Strategies

1. Identify possible value differences and competitive advantages a. Competitive advantage: important, distinctive, superior, communicable, affordable, profitable 2. Selecting an overall positioning strategy a. Value Proosition: the full mix of benefits on which a brand is differentiated and positioning 3. Develop a positioning Statement: sum of the company and brand positioning Form: To (target segment and need) our (brand) is (concept) that (point of difference)

Price Changes

1. Initiating Price Cuts reasons: excess capacity, falling demand because of competition or weakened economy, dominate market through lower costs 2, Initiating Price Increases Reasons: greatly improve profits, cost inflation, over demand A price increase or drop can effect how consumers view the brand

Service Marketing

1. Internal Marketing: service firm must orient and motivate customer-contact employees and supporting service people to work as a team to provide customer satisfaction 2. Interactive Marketing: training service employees in the fine art of interacting with customers to satisfy their needs

Income Distribution

1. Low-income households 2. Middle-income households 3. High-income households ex: effort to boost its presence in Asia;s third largest auto market and Ford introduced the Figo a hatchback

Market Niche

1. Market Niche Strategies -big enough to be profitable with high goeth potential and has little interest from compeitors -key is specialization; market, customer,product,marketing mix

Marketer Challenger

1. Market challenger Strategies: -challenge the leader with an aggressive bid for more market share -Second mover Advantage: challenger observes what has made the leader successful and improves on it. It may launch full frontal attach, matching the competitors product, advertising, pricing, etc and attacks their strengths instead of their weaknesses. -play along with competitors don't rock the boat (ex: Kmart launched "blue light special" campaign against walmart but walmart easily beat them -copy or improve on leaders products and programs with less investment -bring distinctive advantages -must keep prices low or quality and service high

market leader

1. Market leader strategies (40%): expand total demand, protect their current market, expand market share -competition can come along, leaders might become complacent about competition, old fashioned about rivals A. Expand Total Demand by developing: a. new users b. new uses c. more usage of its products B. Protect Current Market by: a. fixing or preventing weekeness b. maintain consistent prices that provide value c. strong customer relations d. continuous innovation C. Expand Market Share by: a. increasing profitability with increasing market share b. produce high quality products c.creating good service experiences d. building close relationships

Competitive positions

1. Market leader strategies (40%): expand total demand, protect their current market, expand market share -competition can come along, leaders might become complacent about competition, old fashioned about rivals 2. market challenger strategies (30%) 3. market follow strategies (20%) 4. market nicher strategies (10%)

Other Pricing Considerations

1. Marketing Mix a. Target Costing: pricing that starts with ideal selling price and then targets costs that will ensure that the price is met 2. Organizational considerations: must decide who within the organization will set the prices a. small companies= top management sets price b. large companies= divisional or product line managers, pricing departments, or sales people set prices 3. The Market and Demand a. Pure competition: many buyers and sellers, non with an effect on the market b. monopolistic competition: several buyers and sellers, price differentiation c. Oligopolistic competition: a few sellers who are sensitive to the other sellers' pricing d. Pure monopoly" one seller, controls price, often regulated 4. The economy a. Market Recession: lower prices b. Market expansion:

Types of wholesalers

1. Merchant Wholesalers: -largers group of wholesalers includes; a. full service wholesalers: provide full set of services b.limited service wholesalers: few services and specialized functions 2. Brokers and agents: a. Brokers: bring buyers and sellers together and assist in negotiations b. agents: represent buyers or sellers 3. Manufacturers' sales branches and offices: wholesaling by sellers or buyers themselves rather than through independent wholesalers

Brand Sponsorship

1. National Brands/Manufacturers Brands: set output under their own brand names 2. Private Name/store brand: sell products to reseller who give product a private name 3, Licensed Brand 4. Co-brand: when two companies join forces to create one brand

Retailing trends - New retailing forms - The Wheel of Retailing - Megaretailers - Direct and online - Retail technology - Green retailing

1. New Retailing forms 2. The Wheel of Retailing:states that many new types of retailing forms begin as low margin, low price, low status operating, and challenge established retailers. As they succeed they upgrade their facilities and offer more services and increasing their price. 3.Megaretailers: involves rise of mass merchandisers and specialty superstores, formation of vertical marketing systems. Have superior information systems, buying power, and large selection 4. Direct and Online: shoppers have much more availability to shop online 5. Retail Technology: provides better forecasts, inventory control, electronic ordering, transfer of information, scanning, online transaction processing, improved merchandise handling systems, and ability to connect with customers 6. Green retailing: stores are have greener store designs, contraction, operation, product assortment, recycling made easier, and greener packaging and distribution

Steps in Developing Effective Marketing Communication-Choosing a Media Personal Communication

1. Opinion Leaders: people within a reference group who, because of their special skills, knowledge, personality, or other characteristics, exerts social influence on others 2. Buzz Marketing: involves cultivating opinion leaders and getting them to spread information about a product or service to others in their communities -personal influence is very persuasive for expensive, risky, or highly visible -50% of consumers=friends and family are #1 influence on purchase

Developing and Advertising Programs Other Advertising Considerations

1. Organizing for advertising a. Agency: largest U.S agency is BBDO Worldwide b. In-house= might include departments, advertising departments 2. International Advertising Decisions a. Standardization: face many challenges adapting the advertising to the culture, with the increased popularity of online social networks and video sharing boosted need for advertising standardization. Produces many benefits include lower advertising costs, greater global advertising coordination, and more consistent worldwide image. Drawbacks include the fact that country markets differ greatly in their culture, demographics, and economic conditions

Basic Competitive Strategies (Michael Porters)

1. Overal Cost Leadership: a company achieves the lowest product and distribution costs and allows it to lower its prices and gain market share 2. Differentiation: company concentrates on creating a highly differentiated product line and marketing program so it comes across as an industry class leader 3. Focus: company focuses its efforts on serving a few market segments well rather than going after the whole market 4. Middle of the Road: companies with out a clear strategy would not succeed

New-Product Pricing Strategies

1. Price Skimming: pricing strategy in which a marketer sets a relatively high price for a product or service at first, and then lowers the price over time -products image and quality must support its higher price, demand must be high enough 2. Market-Penetration Pricing: Pricing strategy of setting a low initial entry price for a new product in order to attract a large number of buyers and a large market share -conditions must be met: market is highly price sensitive,production and distribution costs must decrease as sales volume increases, low price must help keep out competition, penetration pricer must maintain its low-price position

Product Mix Pricing

1. Product Line Pricing: management must determine the price steps to set between the various product in a line 2. Optional Product Pricing: offering to sell optional or accessory products along with the main product 3. Captive Product Pricing: companies that make products that must be used along with the main product. ex: razer blades, video games, printer cartridges 4. By-Product Pricing: setting a price for by-products in order to make the main product's price more competitive ex: animal poo at the Zoo can be excellent source of extra revenue but turning it into compost and sells it 5. Product Bundle Pricing: sellers combine several products and offer bundle at a reduced price ex: big mac bundle

Product and Service Decisions (Individual product decisions)

1. Product Quality a. total quality management (TQM): approach in which all of the company's people are involved in constantly improving the quality of products, services, and business processes 2, Product Features: product can be offered with varying features, more value by offering more features 3. Product Style and Design: distinct product style and design -different than style: only describes the appearance of the product -Design goes to heart of the product, contributes to the products usefulness as well as to its looks

Factors Contribute to Rapid Growth of Sales Promotions

1. Product managers under pressure to increase current sales 2. Companies face more competition 3. Competing brands offer less differentiation 4. advertising efficiency has declined due to rising costs, clutter, and legal constraints 5. Consumers are more deal-oriented

Shaping the Overall Promotion Mix-Promotion Mix Strategies

1. Push Strategy: involves "pushing" the product though marketing channels to final consumers. The produced directs its marketing activities toward channel members to induce them to carry the product and promote to final consumers. ex: John Deere does very little advertising and instead sells the product to Lowe's, Home Depot, etc and they push their products to consumers 2. Pull Strategy: producer directs its marketing actives toward final consumers to induce them to buy the product. ex: Unilever promotes its Axe grooming products to its young male target market using TV ads, print ads, and a brand website. If strategy is successful then consumers will go to retailers to buy the product. -Business-to-consumers companies usually pull more, putting more of their funds into advertising, following by sales promotion, personal selling, then PR -Business-to-Business marketers tend to push more, putting more of their funds into personal selling

Evaluating Salespeople and Sales Force Performance

1. Sales Reports 2. Call Reports 3. Expense Reports

Major Sales Promotion Tools and Consumer Tools

1. Samples: most effective and most expensive 2. Coupons:promote early trial of a new brand or stimulate sales, however they are issuing few coupons and targeting them more carefully 3. Rebates: price reduction occurs after the purchase 4. Price Packs: also called " cents-off deals", offer consumers savings off the regular price of a product, are even more effective than coupons in stimulating short-term sales 5. Premiums: goods offered for free or at a low price 6. Advertising Specialties: usually articles imprinted with the advertising name, logo, or message that are given as gifts to consumers 7. Point-of-Purchase Promotions: include displays and demonstrations that take place at the point of sales 8. Contests: contests requires an entry by each consumer 9.Sweepstakes:require consumers submit their names for a drawing 10.Games: present consumers with something that may or may not help them with a prize 11. Event Marketing: links events and sponsorships to a brands value proposition 12. Discount 13. Allowance: percent off each case in return for the retailers agreement to feature the manufacturer's products in some way 14. Free Goods: extra cases of merchandise to resellers who buy a certain quantity or feature certain flavor or size 15. Specialty Advertising: manufacturers may give retailers specialty advertising items that carry the company's name such as pens, calendars, memos pads, etc 16. Conventions and Trade Shows: effective to reach many customers not reached with regular sales force 17. Sales Contests: effective in motivating salespeople or dealers to increase performance over a given period of time

Types of retailers

1. Service a. self-service: serve customers willing to perform on their own b. limited service: provide a little more sales assistance because they care more shopping goods c. Full-service: assist customers in every phase of shopping 2. Product Line a.specialty store: carries narrow product line with deep assortment within that line b. Department store: wide variety of product lines c.Convenience stores: limited line of high-turnover goods d. Superstores: food and non-food goods e. Category Killer: giant specialty store that carries deep assortment of a particular line 3. Types of retailers relative prices a. discount stores b.off-price retailers c.factory outlets d.warehouse clubs 4. Types of retailers organizational approach a. corporate chains: two or more outlets that are commonly owned and controlled b.voluntary chains: whole-sale sponsored groups of independent retailers that engage in group buying and common merchandising c. retailers cooperatives: independent retailers that band together to set up a joint-owned, central wholesale operation and conduct join merchandising and promotion d.franchise organizations e. merchandising conglomerates

Creating the Advertising Message: execution styles

1. Slice of Life: style shoes one more "typical" people using the product in a normal setting (coffee) 2. Lifestyle: style shows how a product fits in with a particular lifestyle (yoga pose) 3. Fantasy: style creates a fantasy around the product 4. Mood or Image: style builds a mood or image around the product or service, such as beauty,love, intrigue, or serenity 5. Musical: style shows people or cartoon characters singing about the product 6. Personality symbol: style creates a character that represents the product (ex: Flo, Mr. Clean) 7.Technical expertise: this style shows the company's expertise in making the product 8.Scientific Evidence: style presents survey or scientific evidence that the brand is better or better liked (ex: crest) 9. Testimonial Evidence or Endorsement: style features a highly believable or likable source endorsing the product

Setting the Advertising Budget: Factors

1. Stage in product life cycle: new products =more money 2. Market Share: building or taking market share from competitors requires more money. Low-share brands usually need more advertising spending as a percentage of their sales. 3. Competition: more competition= more money on advertising -so many factors effect advertising effectiveness= advertising is usually easiest budget item to cut but that doesn't actually harm sales in the short run

Brand Name selection

1. Suggests something about products benefits and qualities (lean cuisine) 2. Easy to pronounce (tide, jelly belly) 3. Distinctive (panera) 4. Extendable (going into other markets, abroad, ex: amazon)

Designing the Sales Force Structure

1. Territorial Sales force structure: if they only sell one product line to one industry with customers in many locations 2. product sales force structure:sells many products to many types of customers 3. customer sales force structure: Same situation as two 4. complex sales force structure: might need a combination

Selecting Target Market Segments

1. Undifferentitated Marketing: strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer. Hard to find a product that appeals to all customers. 2. Differentiated Marketing: strategy which a firm decides to target several market segments and designs separate offers for each (ex: many different types of laundry detergent but can also by many different kinds of tide). Becomes very costly 3. Concentrated Marketing: market-strategy which a firm goes after a large share of one or a few segments or niches ex: whole foods 4. Micromarketing: tailoring products and marketing programs to suit the tastes of specific individuals and locations a. Local marketing: tailoring products to the needs and wants of local customer groups-cities, neighborhoods, and even specific stores b.individual marketing: tailoring products to the needs and preferences of individual customers (Nikes ID program shoes)

Supply Chains and the Value Delivery Network

1. Upstream Partners: Include raw material,component parts, information, finances, and expertise to create a product a service 2. Downstream Partners: include the marketing channel or distribution channels that look toward the customer, including retailers and wholesalers 3. Supply Chain: "make and sell" view includes the firms raw materials, productive inputs, and factory capacity 4. Demand Chain: "Sense and respond" view suggests that planning starts with the needs of the target customers, and the firm responds to these needs by organizing a chain of resources and activities with the goal of creating customer value 5. Value delivery network: the firms suppliers, distributors, and customers who partner with each other to improve the performance of the entire system

Major Logistic Functions

1. Warehousing: how many, what types of warehouses it needs, where they need to be located, whether to use warehouses or distribution centers (designed to move goods rather than just store) 2. Inventory Management: just-in-time systems (carry only small inventories for a few days), RFID (know at anytime where a product is located), Smart Shelves (not only tell when its time to order but automatically order) 3.Transportation: affects the pricing of the products, delivery performance, condition of the goods when they arrive 4. Logistics information management: management of the flow of information including customer orders, billing, inventory levels, and customer data a. EDI: electronic data inerchange b. VMI: vendor-managed inventory

Integrated Marketing Communications - The New Marketing Communications Model

1. consumers are better informed: digital age, internet, connect more easily 2. more communication 3. Less mass marketing: developing focused marketing programs designed to build closer relationships with customers 4. Changing communications technology: changing the way companies and customers communicate with each other - companies are doing less broadcasting and more narrowcasting (narrow, targeted, more effective) -Although TV is more dominant form of advertising ad spending on major TV networks has stagnated and ad spending on Internet/other digital media has surged

Price Adjustment Strategies

1. discount and allowance pricing: Discounts: a. Cash discount: price reduction to buyers who pay their bills promptly b. quantity discount: given to people who buy in bulk c. functional discount/trade discount: manufacturer reduces the retail price of a product when it sells to a reseller d. Seasonal discount: price reduction to buyers who buy products out of season Allowances: promotional money paid by manufacturers to retailers who agree to feature the product in some way a. Trade-In allowances: price reduction given for turning in an old item when buying a new one 2. Segmented Pricing: selling a product or service at two or more prices a. Customer-segment: Different customers pay different prices (ex: senior citizens at movies) b. Product-Form Pricing: different versions of the product are priced differently (ex: airline tickets for seats) c. Location-based pricing: company charges different prices for different locations (ex: public universities charge out-of -state people more money) d. Time-based pricing: firm varies its price by season 3. Psychological Pricing: prices that considers the psychology of prices and not simply the economics a. reference pricing: prices that buyers carry in their minds and refer to when they look at a given product 4. Promotional Pricing: temporary pricing products below the list price, and sometimes even blow cost,to increase short-run sales -to create buying excitement and urgency 5. Geographical Pricing: setting prices for customers located in different parts of the country or world 6. Dynamic Pricing: adjusting prices continually to meet the characteristics and needs of individual customers and situations (ex: online shopping) 7. International Pricing: companies that market their product internationally must decide what prices to charge in different countries

Describing a Competitive Intelligence System

1. identifies competitive information and the best sources of this information 2. continually collects information 3.checks information for validity and reliability 4. interprets information 5. organizes information 6. sends key information to relevant decision makers ("in house expert: smaller companies that can't afford set up formal competitive intelligence offices can assign specific executives to watch particular competitors) 7.responds to inquires about competitors

6 Cs of Channel Strategy

1.Cost - developing channel and maintaining it 2.Capital Requirements - max investment required when org develops own channels or internal sales force 3.Control - the more involved a company is with distribution, the more control they exert 4.Coverage - assessed by geographic segments, market segments or both 5.Character - channel of dist. selected must fit with character of company and market its doing business in 6.Continuity - channels of dist. often pose longevity problems

6 major segmentation variables

1.Geographic Segmentation 2. Demographic Segmentation (the most popular!) 3.Psychographic Segmentation 4.behavioral Segmentation 5. Usage Rate 6. Loyalty Status

Forms of Direct Marketing

1.Personal Selling direct marketing 2. Direct-mail direct marketing 3. catalog direct marketing 4. telephone marketing 5. direct-response TV marketing 6. Kiosk Marketing 7. Digital direct marketing 8. online marketing

Setting the Total Promotion Budget and Mix -Percentage of Sales Method

2. Percentage of Sales Method: sets the budget at a certain percentage of current or forecasted sales or unit sales price, easy to use and helps management think about the relationship between promotion, selling price, and profit per unit, however it wrongly views sales as the cause of the promotion rather than as the result, long-range planning difficult, and no method for picking specific percentage just picked whats done in the past

the limited control over the distribution process

A disadvantage when using home-country middlemen as intermediaries in the distribution process is:

False

A distinguishing characteristic of the Japanese distribution channel system is that it is controlled by a few small retailers found in the country.

export management companies

A major disadvantage of _____ is that they can seldom afford to make the kind of market investment needed to establish deep distribution for products.

the large amount of commission charged by the home-country middlemen.

A major trade-off when using home-country middlemen is:

False

A majority of the population of less developed countries can be reached readily through the traditional mass medium of advertising.

False

A physical distribution system involves only the physical movement of goods.

false

A product line is defined as the complete assortment of products that a company offers to its target international consumers.

True

A reason for the failure of marketing communications is that the message received by the intended audience is not understood because of different cultural interpretations.

Complex Sales Force Structure:

A wide variety of products is sold to many types of customers over a broad geographic area and combines several types of sales force structures

foreign sales corporation

manufacturer's export agent

A(n) _____ is an individual agent middleman or an agent middleman firm providing a selling service for manufacturers that covers only one or two markets.

_____ in countries can distort media choice by changing the cost ratios of various media. A. Advertising taxation B. Language C. Power distance D. Cultural traits E. Dialect

A. Advertising taxation

________ in countries can distort media choice by changing the cost ratios of various media.

A. Advertising taxation

Which of the following is true of advertising agencies for international advertising?

A. Cross-cultural communication between a foreign client and a local agency can be problematic.

Of the seven steps involved in international advertising, _____ almost always represents the most daunting task for international marketing managers.

A. Developing messages

Cremics, a multinational drug manufacturing company, used a saffron trident in a promotional campaign for one of its drugs in India. The saffron trident, a religious symbol in India, was meant to indicate the three levels of efficacy of the drug but mistakenly conveyed a religious message to Indians. This miscommunication indicates a problem associated with which of the following steps of an international communications process? A. Encoding B. Noise cancellation C. Media channel selection D. Message transmission E. Information source selection

A. Encoding

Cremics, a multinational drug manufacturing company, used a saffron trident in a promotional campaign for one of their drugs in India. The saffron trident, a religious symbol in India was meant to indicate the three levels of efficacy of the drug, but mistakenly conveyed a religious message to Indians. This miscommunication indicates a problem associated with which of the following steps of an international communications process?

A. Encoding

Janet works for a media agency based in Japan. Janet is helping the integrated marketing communications (IMC) manager of Siljure, a French cosmetics company, with the design and content to be used in an upcoming promotional campaign in Japan. The IMC manager knows what to convey but wants to advertise it in a culturally relevant manner. Which step of the international communications process is Janet helping Siljure with? A. Encoding of the message B. Choosing an appropriate channel for the message C. Decoding of the message D. Providing feedback from customers E. Reducing noise from competing ad campaigns

A. Encoding of the message

Meta Garbon, a manufacturer of sports bicycles, in a bid to tap the enormous market for bicycles in China promote their cycles as premium sporting and leisure bicycles. They use various cycling legends and sports celebrities as brand ambassadors and use television, radio, and newspapers as media. Bicycles in China are used mainly by the working class for commutation, and the main users of bicycles did not relate to Meta Garbon's products, and the promotional campaign was a failure. During which of the following steps of the international communications process did Meta Garbon most likely go wrong? A. Information source selection B. Selection of message channel C. Encoding D. Decoding E. Noise cancellation

A. Information source selection

Meta Garbon, a manufacturer of sports bicycles, in a bid to tap the enormous market for bicycles in China promote their cycles as premium sporting and leisure bicycles. They use various cycling legends and sports celebrities as brand ambassadors, and use television, radio, and newspapers as media. Bicycles in China are used mainly by the working class for commutation, and the main users of bicycles did not relate to Meta Garbon's products and the promotional campaign was a failure. During which of the following steps of the IMC process did Meta Garbon go wrong?

A. Information source selection

A. Public relations

Which of the following elements of integrated marketing communications is related to encouraging the press to cover positive stories about companies and managing unfavorable rumors, stories, and events? A. Public relations B. Direct selling C. Trade shows D. Personal selling E. Sales promotion

A. Public relations A public relations job consists of not only encouraging the press to cover positive stories about companies but also managing unfavorable rumors, stories, and events.

_____ are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.

A. Sales promotion

_____ are short-term efforts directed to the consumer or retailer to achieve such specific objectives as consumer product trial or immediate purchase.

A. Sales promotion

Which of the following is an example of the primary function of a product? A. The ability of a camera to take a picture B. The design and form factor of a phone C. The color of a laptop D. The prestige associated with driving a car E. The shape of speakers

A. The ability of a camera to take a picture A market offering really is a bundle of satisfactions the buyer receives. This package of satisfactions, or utilities, includes the primary function of the product or service, along with many other benefits imputed by the values and customs of the culture.

Which of the following is an example of the primary attribute of a product?

A. The ability of a camera to take a picture.

Which of the following is true about tactical planning?

It refers to the plans that are made at the local level.

Which of the following is true of advertising agencies for international advertising? A. The cross-cultural communication between a foreign client and a local agency can be problematic. B. A multinational agency always has the best feel for a market. C. Only a multinational agency can provide the best cultural interpretation in a situation in which local modification is required. D. Only a local domestic agency can provide a company with a high level of sophistication. E. Agency commission patterns are consistent throughout the world.

A. The cross-cultural communication between a foreign client and a local agency can be problematic.

Which of the following statements is true of sales promotions? A. They are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation. B. C. They are long-term efforts directed to a manufacturer or supplier. D. They primarily involve activities that encourage the press to cover positive stories about companies. E. They are ineffective in markets where consumers are hard to reach. F. They are the only element of the marketing mix that are affected by cultural differences among country markets.

A. They are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation Sales promotions are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.

Due to differences in culture in different markets, standardized products that are marketed globally will most likely require: A. a different advertising appeal. B. a different primary function. C. consistent promotional messages. D. a standardized marketing strategy. E. standardized secondary attributes.

A. a different advertising appeal.

Due to differences in culture in different markets, standardized products that are marketed globally will require:

A. a different advertising appeal.

A. a different advertising appeal. In many cases, standardized products may be marketed globally. But because of differences in cultures, they still require a different advertising appeal in different markets.

Sales promotions are short-term efforts directed to the consumer or retailer to achieve specific objectives such as: A. consumer product trial or immediate purchase. B. reducing promotional expenses. C. discouraging stores to stock a product. D. eliminating the need for retail point-of-purchase displays. E. long-term performance of a product.

A. consumer product trial or immediate purchase. Sales promotions are short-term efforts directed to the consumer or retailer to achieve such specific objectives as consumer product trial or immediate purchase, consumer introduction to the store or brand, gaining retail point-of-purchase displays, encouraging stores to stock the product, and supporting and augmenting advertising and personal sales efforts.

Companies that rely on television infomercials and television shopping are restricted by the limitations placed on the _____ of television commercials permitted when their programs are classified as advertisements. A. length and number B. religious content C. subliminal messaging D. superlative description E. ethnic derision

A. length and number

Steps in Developing Effective Marketing Communication- Designing a Message

AIDA MODEL 1. Get Attention 2. Hold Interest 3. Arouse Desire 4. Obtain Action

strategic alliance

ANY type of relationship between one or more companies attempting to reach joint corporate and market related goals; term used to refer to most nonequity alliances

Franchises stress the local origin of the products they sell, the local labor they employ, and their stature as local citizens. They even make fun of their U.S. origins to appeal to the local consumers.

According to International Marketing Illustration 8-1: Successful U.S. Franchises in a Hostile World (p. 246), what can the survival of U.S. franchises in countries that are hostile to the United States be attributed to?

Spain Tunisia Greece

According to Marketing Illustration 9-2 about Italian olive oil (p. 271), where does most of the olive oil found in the famous Italian brand of olive oil called Filippo Berio actually come from?

1. China 2. Italy

According to Table 9-1 in your book (p. 278), what country has the most ISO 9001 certifications? According to Table 9-2, which world region has the most ISO 9001 certifications? Which world region is second in number of ISO 9001 certifications?

40%

According to the "Television in India" vignette on page 291, what percent of U.S. households have a television set? What percent of Indian households have a television set? Accordingly, what stage of the life cycle is the U.S. television market considered to be in? What stage is India considered to be in?

According to the text, what international organization often uses advocacy advertising A. McDonald's B. Benetton C. Visa D. Adidas

High service quality On-time shipment Adequate product availability Quality sales force Enough sales effort and sales support Quality of promotion Amount of promotion

According to your book, what seven factors determine, in order, an international product's "goodness of launch"?

false

Adaptation of promotional strategy refers to changing a company's promotional mix so that it it uniform in most of its target markets.

True

Agent middlemen work on commission and do not take title to the merchandise.

Which of the following is an example of comparative advertising?

An ad showing a dog choosing one brand of dog food over another.

True

An e-vendor in a foreign market can generally ignore culture as an important variable because the commerce is being done via the Internet that is culturally insensitive.

James Barker is the marketing manager of a firm with small international sales volume. He is looking for a middleman who can take responsibility for promotion of the company's products, credit arrangements, physical handling, and market research. Also, the middleman must be able to provide information on financial, patent, and licensing matters. In addition, the middleman should agree to work under the name of the firm. Which of the following types of middlemen would be the best choice for Mr. Barker if he wants to meet his objectives?

An export management company

True

An export management company functions as a low-cost, independent marketing department with direct responsibility to the parent firm.

Anne Klein II is an example of a a. line extension b. product mix c. product length d. none of the above

Parallel Importing

Apex Corporation is a wholesaler for Global Electronics in the French market. Global Electronics discovered that Apex Corp. was diverting some of their goods to the English market. Apex Corp. could get a greater profit in the English market because the goods were bought by the firm at a cheaper price in France. In the context of the above scenario, which of the following forms of business is Apex engaged in?

late maturity

At what stage of the International Product Life Cycle (IPLC) do manufacturers in industrialized countries begin to export their product to developing countries? Why does exporting become more important at this stage?

Early maturity

At what stage of the International Product Life Cycle (IPLC) do multinational companies (MNCs) move their production to developing countries? Why do they move production?

Designed Effective Websites

Attract visitors companies must: 1. promote an offline promotion and online link 2. create value and excitement 3. constantly update the site 4. make the site useful

Which of the following statements about advertising laws around the world is correct?

B. Toy, tobacco, and liquor advertising is restricted in numerous countries.

In the context of consumer products, which of the following is the major limitation of the Internet? A. Knowledge of how to use the Internet B. Coverage of the Internet C. Government regulations on the use of the Internet D. Difficulty in tracking the effectiveness of advertisements on the Internet E. Cost of using the Internet

B. Coverage of the Internet

With regard to consumer products, which of the following is the major limitation of the Internet?

B. Coverage of the Internet

In the context of international advertising, _____ is the neon capital of the world.

B. Hong Kong

In the context of international advertising, _____ is the neon capital of the world. A. Paris B. Hong Kong C. London D. Sydney E. Brasília

B. Hong Kong

In the international communications process, an international marketing executive with a product message to communicate acts as a(n) _____.

B. Information source

Using newspapers or magazine ads as a channel of communication when the majority of the intended users are illiterate, is an example of ineffective _____ in the communications process.

B. Media channel selection

Which of the following is true of the newspaper industry around the world? A. In many countries, newspapers hardly have any trouble achieving complete market coverage. B. Most U.S. cities have just one or two major daily newspapers. C. In many countries, advertisements can be run in a newspaper without any time lag. D. Since there is an indication that the space for advertising is paid for, it is easy to tell exactly how much advertising appears in a given newspaper. E. Japan has more than 15 national daily newspapers, but the circulation numbers are the lowest.

B. Most U.S. cities have just one or two major daily newspapers.

_____ allows ESPN to fill visual real estate—blank walls, streets, stadium sidings—with computer-generated visuals that look like they belong in the scene.

B. Princeton Video Imaging

_____ allows ESPN to fill visual real estate—blank walls, streets, stadium sidings—with computer-generated visuals that look like they belong in the scene. A. Self-extracting archive B. Princeton Video Imaging C. High Definition Television D. HighMAT (High Performance Media Access Technologies) E. Conditional Access System

B. Princeton Video Imaging

Which of the following are considered to be major communications media in most countries due to their inherent entertainment value?

B. Radio and television

_____ are considered to be major communications media in most countries due to their inherent entertainment value. A. Newspapers and magazines B. Radio and television C. Newspapers and billboards D. Billboards and television E. Radio and newspapers

B. Radio and television

In the communications process in advertising, during the _____ stage, a consumer takes certain actions to respond to a decoded message.

B. Receiver

In-store demonstrations, samples, coupons, contests, and sweepstakes are examples of _____ devices.

B. Sales promotions

Which of the following statements about advertising laws around the world is correct? A. Advertising of pharmaceuticals is unrestricted in most countries. B. Toy, tobacco, and liquor advertising is restricted in numerous countries. C. Advertising on television is unregulated in most countries. D. The Internet is the only medium where no restrictions exist in any country. E. Television ads are exempted from tax in all countries.

B. Toy, tobacco, and liquor advertising is restricted in numerous countries.

One of the reasons for the notably low use of foreign national consumer magazines by international advertisers is that:

B. few magazines provide reliable circulation data.

In the international communications process, an international marketing executive with a product message to communicate specifically acts as a(n) _____. A. decoder B. information source C. receiver D. encoder E. noise source

B. information source

Using newspapers or magazine ads as a channel of communication when the majority of the intended users are illiterate is an example of ineffective _____ in the communications process. A. feedback B. media channel selection C. noise D. market selection E. message selection

B. media channel selection

In Spain, a new medium for advertising called Publicoche includes:

B. private cars that are painted with advertisements.

In Spain, a new medium for advertising called Publicoche includes: A. lasers projected onto clouds. B. private cars that are painted with advertisements. C. buses fitted with television sets showing promotional messages. D. financing of popular sporting and entertainment events. E. hot air balloons printed with promotional messages.

B. private cars that are painted with advertisements.

In the communications process in advertising, during the _____ stage, a consumer takes certain actions to respond to a decoded message. A. feedback B. receiver C. message channel selection D. encoding E. source identification

B. receiver

In-store demonstrations, samples, coupons, contests, and sweepstakes are examples of _____ devices. A. personal selling B. sales promotions C. content marketing D. direct selling E. public relations

B. sales promotions Cents-off, in-store demonstrations, samples, coupons, gifts, product tie-ins, contests, sweepstakes, sponsorship of special events such as concerts, the Olympics, fairs, and point-of-purchase displays are types of sales promotion devices.

Direct mail is an unpopular medium in Chile because:

B. the letter carrier must collect additional postage for every item delivered.

Direct mail is an unpopular medium in Chile because: A. the literacy level in Chile is extremely low. B. the letter carrier must collect additional postage for every item delivered. C. it uses paper; hence, it is considered as a threat to the environment. D. its reach is extremely limited. E. it is subject to complicated government regulations.

B. the letter carrier must collect additional postage for every item delivered. In Chile, direct mail is virtually eliminated as an effective medium because the sender pays only part of the mailing fee; the letter carrier must collect additional postage for every item delivered. Obviously, advertisers cannot afford to alienate customers by forcing them to pay for unsolicited advertisements.

false

Buying offices are located in the target market country and carry title to the product.

Chapter quiz

For most companies, which of the following are the major components in the marketing communications mix?

C. Advertising and personal selling

_____ are the major components in the marketing communications mix for most companies. A. Public relations and advertising B. Direct selling and trade shows C. Advertising and personal selling D. Public relations and sales promotions E. Direct selling and sales promotions

C. Advertising and personal selling

Which of the following is an example of comparative advertising? A. An ad using a scantily clad model to promote a soft drink B. An ad showing a celebrity smoking his preferred brand of cigarettes C. An ad showing a dog choosing one brand of dog food over another D. An ad showing the superiority of synthetic materials used in its products as compared to cotton E. An ad using shocking or taboo material to promote a product

C. An ad showing a dog choosing one brand of dog food over another

Which of the following is an example of comparative advertising?

C. An ad showing a dog choosing one brand of dog food over another.

_____ in advertising is a thorny issue, because most member countries of the European Commission have different interpretations of what constitutes a misleading advertisement.

C. Deception

_____ in advertising is a thorny issue, because most member countries of the European Commission have different interpretations of what constitutes a misleading advertisement. A. Discrimination B. Endorsement C. Deception D. Plagiarism E. Fear mongering

C. Deception

In the international communications process, _____ is defined as the interpretation by the receiver of the symbolism transmitted from the information source.

C. Decoding

_____ spend more time on social media sites than any users in any other country. A. Mexicans B. Americans C. Israelis D. Spaniards E. Italians

C. Israelis

In the context of integrated marketing communications, which of the following best defines public relations? A. It is the usage of funds collected from the common public for manufacturing a product in the inaccessible regions of a market. B. It is the direct sale of goods at discount rates to the public at trade fairs. C. It the creation of good relationships with popular press to help communicate messages to their customers, the general public, and governmental regulators. D. It is the distribution of samples and coupons directly to the public in the inaccessible regions of a market. E. It is the sale of goods to the public based on their credit ratings.

C. It the creation of good relationships with popular press to help communicate messages to their customers, the general public, and governmental regulators. Creating good relationships with the popular press and other media to help companies communicate messages to their publics—customers, the general public, and governmental regulators—is the role of public relations.

With reference to the communication process in advertising, using the Internet as a medium when only a small percentage of an intended market has access to it, is an example of an error related to:

C. Message channel selection

Which of the following countries has the most egregious control over advertising, where each medium has its own censorship board that passes judgment on any advertising even before it is submitted for approval by the Ministry of Information. A. Germany B. France C. Myanmar D. Australia E. Argentina

C. Myanmar

An especially effective promotional tool when a product concept is new or has a very small market share is known as _____.

C. Product Sampling

C. Public relations

Certain advertising media are forbidden by government edict to accept some advertising materials. Such restrictions are most prevalent in:

C. Radio and television broadcasting

The assault on advertising of _____ is escalating internationally, as evidenced by the World Health Organization launching a global campaign against it.

C. Tobacco

In the context of media planning and analysis, billboards are especially useful in countries:

C. With high illiteracy rates

In the international communications process, _____ is defined as the interpretation by the receiver of the symbolism transmitted from an information source. A. encoding B. message selection C. decoding D. message channel selection E. feedback evaluation

C. decoding

In the context of the communication process in advertising, using the Internet as a medium when only a small percentage of an intended market has access to it is an example of an error related to: A. feedback. B. decoding. C. message channel selection. D. encoding. E. message selection.

C. message channel selection.

An especially effective promotional tool when a product concept is new or has a very small market share is _____. A. sponsorship B. sweepstakes C. product sampling D. contests E. product tie-ins

C. product sampling An especially effective promotional tool when the product concept is new or has a very small market share is product sampling.

Certain advertising media are forbidden by government edict to accept some advertising materials. Such restrictions are most prevalent in: A. the Internet forums. B. personal selling initiatives. C. radio and television broadcasting. D. trade shows and exhibitions. E. direct selling and sales prootions.

C. radio and television broadcasting.

In the context of international advertising, companies are moving from the commission system to a _____ system. A. tactical B. standardized C. reward-by-results D. self-regulation E. business-to-business

C. reward-by-results

Blogs, virtual worlds, and video sharing are examples of media commonly known as _____. A. global media B. local media C. social media D. Texas Visual Imaging E. widespread media

C. social media

The assault on advertising of _____ is escalating, as evidenced by the World Health Organization launching a global campaign against it. A. trans fat B. alcohol C. tobacco D. pharmaceuticals E. animal-derived products

C. tobacco

C. with high illiteracy rates.

Which of the following is one of the highest costs of doing business in China?

Capital required to maintain effective distribution

Case 8-1

Case 9-1

Which of the following is a critical element associated with using a particular type of middleman?

Cash-flow patterns

Channel organization and design.

Channel Organization 1. Disintermediation: occurs when product or service cuts out intermediaries and go directly to final buyers, or radically new types of channel intermediaries displace traditional ones (ex: southwest and Jetblue sell tickets directly to final buyers cutting out travel agents) 2.Channel Design Decision: a. analyzing consumer needs b. setting channel objectives c. Identify major channel alternatives: types of intermediaries, number of intermediaries, responsibilities of each channel member. 1. Intensive distribution: stocking product in as many outlets as possible 2. Exclusive distribution: giving a limited number of dealers the exclusive right to distribute the company's products 3.selective distribution: use of more than one but fewer than all of the intermediaries who are willing to carry the company's products d. responsibilities of channel members 3. Evaluating the major alternatives: a. needs to be evaluated against; economic criteria, control, and adaptability criteria 4. Designing International Distribution Channels: channel systems must adapt their strategies to the existing structure of that country

True

Channels of distribution often pose longevity problems.

Chapter 10

Chapter 11

Chapter 12

Chapter 13

Chapter 14

Chapter 16

Chapter 8

Chapter 9

A European chocolate manufacturer received several complaints from customers about the quality of its product when it began selling them in a tropical country. The firm had to re-package its chocolate bars in an extra plastic wrapper to protect it from the heat and dust. Which of the following factors in the local market dictated product adaptation in the current scenario?

Climatic requirements

Communication Effects

Communication Effects: indicate whether the ad and media are communicating the ad message well and can be tested before or after the ad runs (conduct pre and post evaluations)

true

Communication about a company that the company does not pay for is defined as publicity.

Companies may choose direct exporting because it allows them to a. monitor retailers b. control suggested sale prices. c. observe the handling of customer complaints. d. all of the above

true

Companies must consider legal and ethical issues with consumer sales promotions. In Germany, "buy one, get one free" offers are illegal.

true

Companies need to examine the fit between the cost of international involvement, company resources, and market potential.

complementary marketing

Companies with marketing facilities in different countries with excess marketing capacity sometimes take on additional product lines for international distribution. The formal name for this type of marketing is:

true

Competing companies are allowed to work in consortia in industry sectors where the government can control their monopolistic activity.

True

Competitive advertising is a source of noise in the international communications process.

Setting the Total Promotion Budget and Mix-Competitive-Parity Method

Competitive-Parity Method: 1. Sets the budget to math competitor outlay, average 2. represents industry standards= argument not valid 3. avoids promotion wars=argument not valid -arguments not valid because there are no grounds for believing that the competition has a better ideas of what a company should be spending on promotion than the company itself

Identify Competitors

Competitors include: -all firms making the same product or class of products -all firms making products that supply same service -all firms competing for same consumer dollars -companies must avoid "competitor myopia": company is more likely to be "buried" by its latent competitors than its current ones Competitors Objectives: company wants to know the importance competitor places on profitability, market share growth, cash flow, technological leadership, and service leadership Competitors Strategies: -Strategic group: group of firms in an industry following the same or similar strategy in a given target market=offers stingiest competition Competitors Strengths and Weeknesses -what can competitors do? -benchmarking: comparing the company's products and processes to those of competitors or leading firms Estimating Competitors Reactions: -what will competitors do?

Shoddy, Harmful, or Unsafe Products

Complaint- products have poor quality, provide little benefit, can be harmful Response: marketers realize this is stupid

Poor Service to Disadvantaged Consumers

Complaint: american marketers serve disadvantaged customers poorly. "redlining": drawing a red line around disadvantaged neighborhoods and avoiding placing stores there. Response: 1. some marketers profitability target these customers and FTC has taken action against marketers tat advertise false values, deny service, or charge disadvantaged customer too much

Which of the following arrangements is undertaken when a firm wants to keep its seasonal distribution channels functioning throughout the year?

Complementary marketing

piggybacking

Complementary marketing is commonly known as _____.

False

Contests, sweepstakes, sponsorship of special events such as concerts are techniques used for maintaining and improving public relations.

Which of the following is one of the six Cs of distribution channel strategy?

Continuity

marketing Ethics

Corporate Marketing Ethics: are broad guidelines that everyone in the organization must follow that cover distributor relations, advertising standards, customer service, pricing, product development, and general ethical standards

________ might be classified as an aspect of sales promotions or public relations, though their connections to advertising are also manifest.

Corporate sponsorship

Setting up an Online Presence

Creating a website requires designing an attractive site and developing ways to get consumers to visit the site, remain on the site, and return to the site

Creating the Advertising Message: Creative Concept

Creative Concept: is the idea, "big idea", that will bring the message strategy to life and guide specific appeals to be used in an advertising campaign. At this stage the simple message becomes great ad campaigns. Characteristics of the appeal include: 1. Meaningful: pointing out benefits that make the product more desirable or interesting to consumers 2. Believable: consumers must believe that the product or service will deliver promised benefits 3. Distinctive: tell how the product is better than competing brands

false

Culture is essential in the marketing of industrial products.

Selecting Competitors to Attack and Avoid

Customer Value Analysis: determines the benefits that target customers' value and how customers rate the relative value of various competitors offers 1. First identifies major attributes that customers value 2. Importance customers place on these attributes 3.assess performance against competitors -Compete against week competitors because easier but may gain little -compete against strong companies to sharpen its abilities -avoid trying to "destroy" a close competitor (ex: market leader Bausch & Lomb moved aggressively against other contact lens companies but forced smaller companies to sell out to larger companies like Johnson & Johnson and in result faced much larger competition) -Good competitors help share costs of market and product develop, help legitimize new technologies, increase total demand -finding uncontested market spaces: create products and services which there are no competitors called a "blue ocean strategy"=make competition irrelevant

During which step of the international communications process does the receiver of the message interpret symbolism transmitted from the information source?

D. Decoding

All of the following are specific objectives of sales promotion EXCEPT: A. immediate purchase. B. consumer introduction to the store. C. gaining retail point-of-purchase displays. D. building brand loyalty. E. encouraging stores to stock the product.

D. building brand loyalty.

In the context of the different types of middlemen, which of the following is an example of a manufacturer's retail store? A. Toys "R" Us B. Walmart C. Costco D. Benetton E. IKEA

D. Benetton

All of the following are specific objectives of sales promotion EXCEPT:

D. Building brand loyalty

With respect to advertising, _____ is especially important when a budget is small or where there are severe production limitations.

D. Creativity

In the context of international advertising, it has been observed that advertising expenditures are generally _____.

D. Cyclical

A major goal of the Export Trading Company (ETC) Act was to:

remove antitrust disincentives to export activities.

During which step of the international communications process does the receiver of the message interpret symbolism transmitted from an information source? A. Selecting a message B. Encoding C. Selecting a message channel D. Decoding E. Identifying the sources of noise

D. Decoding The interpretation by the receiver of the symbolism transmitted from an information source is known as decoding.

In the context of the communications process in advertising, problems of literacy, media availability, and types of media create challenges in the communications process at the _____ step.

D. Encoding

In the international communications process, the sales force of a company that conveys the encoded content to the intended receiver acts as a _____.

D. Message channel

Of all the elements of the marketing mix, decisions involving _____ are those most often affected by cultural differences among country markets. A. direct selling B. public relations C. trade shows D. advertising E. sales promotion

D. advertising Of all the elements of the marketing mix, decisions involving advertising are those most often affected by cultural differences among country markets.

With respect to advertising, _____ is especially important when a budget is small or where there are severe production limitations. A. class distinction B. politicization C. inventory analysis D. creativity E. following a formula

D. creativity

In the context of international advertising, it has been observed that advertising expenditures are generally _____. A. linear B. supplemental C. mutually reinforcing D. cyclical E. constrained

D. cyclical

In the context of the communications process in advertising, problems of literacy, media availability, and types of media create challenges in the communications process at the _____ step. A. feedback B. decoding C. amplification D. encoding E. message selection

D. encoding

The only way to avoid linguistic problems in advertising communication is by:

D. in-country testing with the target consumer group.

The only way to avoid linguistic problems in advertising communication is by: A. creating an entirely new advertisement for the new market. B. using only English in all media promotions. C. developing a new version of the product for the new market. D. in-country testing with the target consumer group. E. using facial expressions and physical gestures in the advertisement.

D. in-country testing with the target consumer group.

In the international communications process, the sales force of a company that conveys the encoded content to the intended receiver acts as a(n) _____. A. decoder B. interpreter C. receiver D. message channel E. noise

D. message channel In the international communications process, the sales force and/or advertising media convey the encoded message to the intended receiver and thus it acts as a message channel.

DHL usses hubs that hold products it delivers regularly so it always has them on hand. This is an example of what international distribution and logistics facilitator? a. freight forwarders b. distribution centers c. transportation firms d. government agencies

DVD players are most likely in which stage of the international product life cycle? a. growth stage b. maturity stage c. decline stage d. product introduction

Customer Databases

Define: is an organized collection of comprehensive data about customer prospects, including geographic, demographic, psychographic, and behavioral data Benefits: locate good and potential customers, generate sales leads, learn about customers, and develop long-term relationships

Follow-Up

Define: is the last step in which the salesperson follows up after the sale to ensure customer satisfaction and repeat business

Podcasts and Vodcasts, Interactive TV, Internet

Define (Podcasts/Vodcasts): involve downloading of audio and video files via the internet to a handheld device such as an iPod or PDA and listening to them at the consumers convenience Interactive TV: lets viewers interact with TV programming and advertising using their remote controls and provides marketers with an interactive and involving means to reach targeted audiences Internet: vast public Web of computer networks that connects users of all types around the world to each other and to a large information repository -"Click-only companies: operate on the internet only. -success of dot.coms have causes brick-and-morter manufacturers to reexamine their business to become "Click and Morter Companies" -Benefits: builds deeper more personalized relationships with customers , reduces ordering costs, speeds up ordering -internet influences 48% of sales

Behavior Segmentation

Define: Divides buyers into segments based on their knowledge, attitudes, uses, and responses concerning a product a. Occasion Segmentation: Dividing the market into segments according to when buyers get the idea to buy and when they actually make the purchase ex:Cambells advertises more heavily in the winter b. User Status: dividing the market into non-users, ex-users, potential users, first-time users, and regular users of a product ex:Pampers are provided and used at most hospitals c. Benefit Segmentation: Dividing the market into different segmentation based on the different benefits customers seek from a product ex: Venus razors designed a razor for each important segment for women shavers

Demographic Segmentation

Define: Dividing the market into segments based on age, gender, income, occupation, ethnicity, and religion a. Age and Life Cycle Segmentation: companies offer different products and marketing strategies to meet customers needs and wants as they change with age (ex: jello for kids is playful and jello for adults is low in calorie) b. Income segmentation: Dividing a market into segments based on income level (ex: putting dollar stores in middle/low class areas) c. Gender Segmentation: Dividing a market into segments based gender (ex: axe, women/mens cosmetics)

Customer Sales Force Structure

Define: Each salesperson sells along customer or industry lines. Separate sales forces may be set up for different industries, serving current customers vs. finding new ones. Ex: Whirlpool assigns individual teams of salespeople to big retail customers such as Lowe's, Best Buy, Home Depot -Improves customer relationships

Sales Force Structure

Define: Each salesperson sells along product lines. Ex: GE employs different sales forces for aviation, energy, transportation,and water processing products, etc. -Improves product knowledge -can lead to territorial conflicts

Territorial Sales Force Structure

Define: each salesperson is assigned an exclusive geographic area and sells the company's full line of products and services to all customers in that territory -Organization clearly defines each salesperson's job and fixes accountability -Increases the salesperson desire to build local customer relationships that in turn will improve selling effectiveness -travel expenses are small because travel limited geographic area -improves relationship building (talk to managers) and selling effectiveness

Prospecting

Define: identifies qualified potential customers through referrals from: -customers -suppliers -dealers -internet -last resort= "cold calling"which is dropping in unannounced

Qualifying

Define: identifying good customers and screening out poor ones by looking at -financial ability -volume of business -needs -location -growth potential

Persuasive Advertising

Define: important when increased competition to build selective demand -some persuasive advertising has become comparative (attacking) advertising: company directly or indirectly compares its brands w/ one or more brands Ex: "Weiner War"; Sara Lee sued Kraft, challenging adverting claims that Oscar Meyer Franks had won a national taste test over other brands, Kraft in turn sued Sara Lee of making similar advertising misstatements a bouts their own hotdog. At the end all it did was question the taste of both hotdogs.

Reminder Advertising

Define: important with mature products to help maintain customer relationships and keep customers thinking about the product ex: Coca-Cola TV do this a lot

Direct Mail Marketing

Define: involves an offer, announcement, reminder, or other item to a person at a particular address -personalized -easy to measure results -costs more than mass media -provides better results than mass media -by far the largest direct market media -still using despite internet technology

Catalog Direct Marketing

Define: involves printed and web-based catalogs benefits of Web Based catalogs: -lower cost than printed catalogs -unlimited amount of merchandise -real-time merchandising -interactive content -promotional features Challenges of Web Based Catalogs: -requires marketing -difficulties in attracting new customers

Telephone Direct Marketing

Define: involves using the telephone to sell directly to consumers and business customers -outbound telephone marketing sells directly to consumers and business' -inbound telephone marketing uses toll-free numbers to receive orders from TV and print ads, direct mail, and catalogs Benefits: -purchasing convenience -increased product service and information Challenges: -unsolicited outbound telephone marketing -Do-Not-Call Registry: bans telemarketers from calling these numbers registered on the list. Have created "opt-in" calling systems which they provide useful information and offers to customers who have invited the company to contact them.

Pre-Approach

Define: is the process of learning as much as possible about a prospect, including needs, who is involved in the buying, and the characteristics and styles of the buyers -Salesperson should set objectives: to qualify the prospect, gather information, or make an immediate sale -Sales person should determine best approach: personal visit, phone call, letter, or an e-mail -determine best time for approach

Handling Objections

Define: is the process where salesperson resolves problems that are logical, psychological, or unspoken

Closing

Define: is the process where salesperson should recognize signals from the buy- including physical actions, comments, and questions to close the sale

Approach

Define: is the process where the salesperson meets and greets the buyer and gets the relationship off to a good start and involves the salesperson: -appearance -opening lines -follow-up remarks (listening is crucial)

Developing the Advertising Strategy

Define: is the strategy by which the company accomplishes its advertising objectives and consists of 1. Creating advertising messages 2. Selecting Advertising media

Presentation

Define: is when the salesperson tells the product story to the buyer, presenting customer benefits and showing how the product solves the customer's problems Need-Satisfaction Approach: buyers want solutions and salesperson should listen and respond with the right products and services to solve customer problems

Posistioning Maps

Define: maps that show consumer perceptions of their brands versus competing products on important buying dimensions

Sustainable Marketing

Define: meeting the needs of consumers whole preserving the ability of future generation to their needs Ex: Mcdonalds "Plan to Win" favorite under 400 calories and are featured in its advertising and on menu boards in its restaurants.sales have increased by almost 60% and profits have more than tripled.

Consumerism

Define: organized movement of citizens and government agencies to improve the rights and power of buyers in relation to sellers

Sales Promotion

Define: refers to the short time incentives to encourage purchases or sales of a product or service now -different types of promotion target different channel members -Today sales promotion accounts for 77% of all marketing expenditures

What are the buyer-readiness stages

Define: stages consumers normally pass through on their way to making a purchase Awareness--> knowledge--> liking--> preference-->conviction---> purchase (influence this step by offering discounts, promotional prices, samples,etc) ex: Procter & Gamble used $150 mil. marketing campaign to introduce consumers to its innovative new laundry product, Tide Pods

Informative Advertising

Define: used when introducing a new product category to primary demand

firm level government level consumer level

Describe three types of service barriers that service providers may face when they expand internationally.

catalog retailers

retailers selling products through mail catalogs.

True

Different cultures often seek the same value or benefits from the primary function of a product.

Which of the following modes of foreign market entry offers the most control and the highest potential return for a company?

Direct foreign investment

Direct international involvement has as a result which of the following? a. the company is exposed to less risk than if it used middlemen b. the company has greater control over marketing strategies. c. the company faces greater risk in the market d. b and c only

In which of the following modes of distribution in the foreign market will a company have to make maximum financial investment?

Direct sales force

Which of the following modes of distribution affords the most control over the distribution channels but often at a cost that is not practical?

Direct sales force

In which of the following modes of distribution in the foreign market will a company have to make maximum financial investment?

Direct sales force.

Which of the following has proved to be an important way to break the trade barrier imposed by the Japanese distribution system?

Direct sales through catalogs

________ has long been considered the most effective nontariff barrier to the Japanese market.

Distribution in Japan

Distribution Channels

Distribution is the physical flow of goods through channels. Channels are made up of a coordinated group of individuals or firms that perform functions that add utility to a product or service

Psychographic Segmentation

Dividing buyers into different segments based on social class, lifestyle, or personality characteristics (ex: mountain-dew targeted towards youthful, adventurous but coke targets to the more mature) ex: W hotel

Loyalty Status

Dividing the market by consumer loyalty to brands, stores, companies,and further by the degree of loyalty

Geographical Segmenetation

Dividing the market into different geographical units, like countries, regions, states, and cities

Usage Rate

Dividing the market into light, medium, and heavy users of the product

True

Domestic middlemen are most likely to be used when the marketer desires to minimize financial and management investment.

False

Domestic middlemen offer many advantages for companies with large international sales volume.

False

Due to their inherent entertainment value, satellite TV and the Internet have become major communications media in almost all nations.

Dunken vs. Starbucks

Dunkin: targets the everyday people, middle class Starbucks: people willing to pay a little extra, want the atmosphere, more upper/business class/people

Due to their inherent entertainment value, satellite TV and the Internet have become major communications media in almost all nations.

False

The _____ step in the international communications process refers to the information about the effectiveness of the message that flows from the receiver (the intended target) back to the information source for evaluation of the effectiveness of the process. A. message channel selection B. interpretation C. encoding D. decoding E. feedback

E. feedback

Of all the elements of the marketing mix, decisions involving which of the following are those most often affected by cultural differences among country markets?

E. Advertisement of the product

Of all the elements of the marketing mix, decisions involving which of the following is most often affected by cultural differences among country markets? A. Price of the product B. Benefits offered by the product C. Services offered along with the product D. The place of offering the product E. Advertisement of the product

E. Advertisement of the product Of all the elements of the marketing mix, decisions involving advertising are those most often affected by cultural differences among country markets.

_____ might be classified as an aspect of sales promotions or public relations, though their connections to advertising are also manifest. A. Corporate entrepreneurship B. Corporate sustainability C. Corporate governance D. Corporate espionage E. Corporate sponsorship

E. Corporate sponsorship Corporate sponsorships might be classified as an aspect of sales promotions or public relations, though their connections to advertising are also manifest.

In the context of international advertising, global mass media advertising is a powerful tool for _____.

E. Cultural Change

In the international communications process, during _____, the message from the source is converted into effective symbolism for transmission to a receiver.

E. Encoding

Which of the following is the last step in an international advertising campaign? A. Developing the most effective message(s) for the market segments selected B. Specifying the goals of the communication C. Selecting effective media D. Executing the campaign E. Evaluating the campaign relative to the goals specified

E. Evaluating the campaign relative to the goals specified An international advertising campaign usually ends with evaluating the campaign relative to the goals specified.

Which of the following steps of a communications process is important as a check on the effectiveness of the other steps?

E. Feedback

Which of the following steps of the international communications process is important as a check on the effectiveness of the other steps? A. Selecting a proper message B. Encoding the message C. Selecting an appropriate channel of communication D. Decoding the message E. Feedback

E. Feedback

E. Feedback The feedback step of the communications process is important as a check on the effectiveness of the other steps. Companies that do not measure their communications efforts are likely to allow errors of source, encoding, media selection, decoding, or receiver to continue longer than necessary.

Which of the following are especially vulnerable as EU member states decide which area of regulation should apply to these services?

E. Internet services

Which of the following is especially vulnerable as EU member states decide which area of regulation should apply to these services? A. Newspaper advertising B. Radio advertising C. Outdoor services D. Personal selling E. Internet services

E. Internet services

E. Internet services Internet services are especially vulnerable as EU member states decide which area of regulation should apply to these services.

Which of the following elements of the international communications process comprises external influences, such as competitive advertising, other sales personnel, and confusion at the receiving end that can detract from the ultimate effectiveness of the communication?

E. Noise

56. Which of the following elements of the international communications process comprises of external influences such as competitive advertising, other sales personnel, and confusion at the receiving end that can detract from the ultimate effectiveness of the communication? A. Selecting a message source B. Encoding C. Selecting a message channel D. Decoding E. Noise

E. Noise Noise comprises various external influences such as competitive advertising, other sales personnel, and confusion at the receiving end that can detract from the ultimate effectiveness of the communication.

While developing an international advertisement campaign, which of the following is the first step of the process?

E. Perform marketing research

While developing an international advertisement campaign, which of the following is the first step of the process? A. Compose and secure a budget based on what is required to meet goals. B. Specify the goals of the communication. C. Select effective media. D. Execute the campaign. E. Perform marketing research.

E. Perform marketing research. The steps to be performed for developing an international advertisement campaign are: perform marketing research; specify the goals of the communication; develop the most effective message(s) for the market segments selected; select effective media; compose and secure a budget based on what is required to meet goals; execute the campaign; and evaluate the campaign relative to the goals specified.

_____ suffer(s) from issues such as difficulty in assessing taxes, unfair competition, import duties, and privacy.

E. The Internet

_____ suffer(s) from issues such as difficulty in assessing taxes, unfair competition, import duties, and privacy. A. The radio B. Direct mail C. Magazines D. Newspapers E. The Internet

E. The Internet As the Internet continues to grow and countries begin to assert control over what is now a medium with few restrictions, increasing limitations will be set. Beyond the control of undesirable information, issues such as pay-per-view, taxes, unfair competition, import duties, and privacy are being addressed all over the world.

Social media such as blogs and social networking permits consumers to:

E. become authorized virtual brand agents for the product manufacturers.

The emergence of pan-European communications media will most likely cause companies to:

E. choose more standardized promotional efforts.

The emergence of pan-European communications media will most likely cause companies to: A. opt for localized promotional campaigns. B. opt for greater customization of promotional efforts. C. promote their products only in English. D. use only the Internet as their message channel. E. choose more standardized promotional efforts.

E. choose more standardized promotional efforts. The emergence of pan-European communications media is enticing many companies to push the balance toward more standardized promotional efforts. As media coverage across Europe expands, it will become more common for markets to be exposed to multiple messages and brands of the same product.

In the context of integrated marketing communications, in many markets, the availability of appropriate _____ to customers can determine entry decisions.

E. communication channels

Most toy manufacturers would agree that toys cannot be marketed profitably in countries without commercial television advertising directed toward children. In this scenario, commercial television advertising exemplifies the availability of appropriate _____. A. demonstrations B. personal selling services C. direct mailing services D. financial aid E. communication channels

E. communication channels In many markets, the availability of appropriate communication channels to customers can determine entry decisions. For example, most toy manufacturers would agree that toys cannot be marketed profitably in countries without commercial television advertising directed toward children.

In the international communications process, during _____, the message from the source is converted into effective symbolism for transmission to a receiver. A. interpretation B. scrambling C. standardizing D. decoding E. encoding

E. encoding

E. feedback The feedback step in the international communications process refers to the information about the effectiveness of the message that flows from the receiver (the intended target) back to the information source for evaluation of the effectiveness of the process.

Integrated marketing communications are composed of all of the following EXCEPT:

E. political rallying

Integrated marketing communications are composed of all of the following EXCEPT: A. advertising. B. sales promotions. C. trade shows. D. public relations. E. political rallying.

E. political rallying. Integrated marketing communications (IMC) are composed of advertising, sales promotions, trade shows, personal selling, direct selling, and public relations.

One of the drawbacks of satellites is:

E. their ability to span a wide geographical region.

One of the drawbacks of satellites, which is also their strength, is: A. the cost of creating a high quality ad for satellite television. B. the limited market penetration of satellite television. C. the number of intermediaries required for satellite service transmission. D. the government regulations placed on satellite advertising. E. their ability to span a wide geographical region.

E. their ability to span a wide geographical region. One of the drawbacks of satellites is also their strength, that is, their ability to span a wide geographical region covering many different country markets. That means a single message is broadcast throughout a wide area. This span may not be desirable for some products.

Approaches to Marketing Strategy

Entrepreneurial Marketing: Involves visualizing an opportunity and constructing and implementing flexible strategies Formulated Marketing: involves developing formal marketing strategies and following them closely Intreprenurial Marketing: involves the attempt to reestablish an internal entrepreneurial spirit and refresh marketing strategies and approaches

Environmentalism

Environmentlism: is an organized movement of concerned citizens, businesses, and government agencies to protect and improve people's living environment Environment Sustainability: is getting profits while helping to save the planer Pollution Prevention: involves not just cleaning up waste but eliminating or minimizing waste before it creates Product Stewardship: involves minimizing the pollution from production and all environmental impact throughout the full product life cycle Design for Environement (DFE): involves thinking ahead to design products that are easier to recover, reuse, or recycle New Clean Technologies: involves looking ahead and planning new technologies for competitive advantage Sustainabilty vision: guide to the future that shows the company that the company's products, process, and policies must evolve and what is needed to get there

True

Errors at the receiver end of the international communications process do not occur if the message is encoded properly.

Which of the following is the last step in an international advertising campaign?

Evaluating the campaign relative to the goals specified

to personally talk to ultimate consumers to find whom they consider to be the best distributors.

Experienced exporters suggest that the only way to select a middleman is:

Factors Influencing channel Distribution Decisions (External)

External: Consumer shopping habits and market size Competitive climate Local regulations

With some exceptions, usually a majority of the population of less developed countries can be reached readily through the traditional mass medium of advertising.

FALSE A majority of the population of less developed countries cannot be reached readily through the traditional mass medium of advertising.

A proper encoding system allows a company to correct errors before substantial damage occurs.

FALSE A proper feedback system allows a company to correct errors before substantial damage occurs.

In the context of international advertising, an advertiser should ideally exclude availability, cost, and coverage of media.

FALSE In international advertising, an advertiser must consider the availability, cost, coverage, and appropriateness of the media. Local variations and lack of market data require added attention.

When a marketing executive advertises his product in a newspaper, the newspaper acts as a feedback channel.

FALSE In this case, since the marketer is sending his message to his target audience through a newspaper, the newspaper acts as a message channel.

Industrial advertisers rarely use direct mail for advertising

FALSE Industrial advertisers are heavy mail users and rely on catalogs and sales sheets to generate large volumes of international business.

In the context of international advertising, advertisers prefer global television (satellite broadcasts) due to the availability of accurate market data in most countries.

FALSE Lack of available market data seems to characterize most international markets; advertisers need information on income, age, and geographic distribution, but such basic data seem chronically elusive except in the largest markets. Even the attractiveness of global television (satellite broadcasts) is diminished somewhat because of the lack of media research available

Feedback channels must be carefully selected if an encoded message is to reach the consumer.

FALSE Message channels must be carefully selected if an encoded message is to reach the consumer.

International advertisers use foreign national consumer magazines extensively because they have dependable circulation figures.

FALSE The use of foreign national consumer magazines by international advertisers has been notably low for many reasons. Few magazines have a large circulation or provide dependable circulation figures.

Uncontrollable and unpredictable influences such as competitive activities and confusion that detract from the process of communication are called feedback.

FALSE Uncontrollable and unpredictable influences such as competitive activities and confusion that detract from the process of communication are called noise.

A proper encoding system allows a company to correct errors before substantial damage occurs.

False

Contests, sweepstakes, sponsorship of special events such as concerts are techniques used for maintaining and improving public relations.

False

trading companies

False

For most companies, trade shows and direct selling are the major components in the marketing communications mix.

Franchising constitutes a primary entry mode for the ___ industry. a. automobile b. technology c. service d. machine-tools

In the context of factors affecting choice of channels, which of the following is one of the key elements in distribution decisions?

Functions performed by middlemen

Ford Motor Company

General Motors, _____, and DaimlerChrysler have created a single online site called Covisint for purchasing automotive parts from suppliers.

true

General merchandise discount store retailers sell high volumes of merchandise and offer limited services; they also charge lower prices.

Girls around the world participating in similar pastimes such as inline skating or playing with barbie dolls are in illustration of a. differentiated consumer preferences b. global consumers c. international production d. none of the above.

consumer factors technology factors distribution factors local government

Give examples of each of four factors that contribute to counterfeiters' success.

true

Glamor, Cosmopolitan, and Mademoiselle are all examples of global media

Good traits vs. Bad traits for personal selling

Good Traits: good listener, empathetic, honest, dependable, thorough, follow-up types Bad Traits: Pushy, late, deceitful, disorganized, unprepared

Harrods of London exemplifies which of the following retail formats? A. specialized markets B. all-purpose discount stores. C. specialty stores. D. department stores.

Ministry of International Trade and Industry

In Japan, under the Large-Scale Retail Store Law, all proposals for new "large" stores are first judged by the _____.

true

Home-country intermediaries are instrumental in providing all international marketing services for firms that otherwise would not be able to enter a foreign market.

true

Homeowners worldwide often agree to display advertising on the walls of their homes

In the context of international advertising, ________ is the neon capital of the world.

Hong Kong

Ethnocentric consumers believe that purchasing imported products hurts the economy, causes loss of jobs, and is unpatriotic, and consumers purchasing foreign products are worthy of contempt

How can ethnocentrism related to country of origin affect consumer perceptions of imported products?

Competitive Marketing Strategies

How companies analyze their competitors and develop value-based strategies for profitable customer relationships

Whoever receives the right to use the brand name, certain technology, or an industry know-how (licensee) must in turn pay royalties to the licensor

How does a licensor (the owner of a product license who agrees to share such knowhow or technology with a licensee) earn money under this type of foreign marketing setup?

A joint venture consists of 2 companies who share equity, labor, and capital a Consortia is 3 or more companies.

How is a consortia different from a joint venture?

New Product Development Strategy

Idea Generation: the systemic search for new product ideas 1. Internal: Find new ideas through research and development (R&D) 2. External: find new ideas from distributers and suppliers. Distributers can pass along information about consumer problems and new product possibilities and suppliers can tell company about ne concepts, techniques, and materials that can used to develop new products. Most importantly is customers: analyze customer questions and complaints. ex: LEGO group: invite users to submit ideas for new lego products and to vote for other users' ideas, ideas supported by 10,000 votes are reviewed internally and if chosen that person will receive 1 percent of their total sales. 3. Crowdsourcing: invites broad communities of people-- customers, employees, independent scientists, and researchers, into the new innovation process. ex: Procter & Gamble: developed its connect+develop crowdsourcing process, company uncovers promising innovations from entrepreneurs, scientists, engineers, and other researchers

New Product Development Process

Idea Screening: help spot good ideas and drop the bad ones as soon as possible Product Concept: detailed version of the idea Product Image: Way the consumer perceives the product Concept Testing: actually testing the product with the target market

If a firm's objectives are centered on generating high profit and recovering product development costs quickly, it is likely to use which one of the following international pricing strategies? A. skimming B. penetration pricing C. standardized pricing D. competitive pricing

Which of the following distribution structures is also known as a traditional distribution structure?

Import-oriented

local company (state- owned enterprise) 50%

In developing countries, joint ventures typically take place between an international firm and a __________________, and the local government typically limits the ownership of the international firm to less than ___ percent.

False

In the U.S., if a middleman is terminated, the company is required to pay one percent of the middleman's average annual compensation, multiplied by the number of years the middleman served, as a final settlement.

True

In the context of advertising, a marketer's self-reference criterion (SRC) affects the ultimate success of the communication.

secondary wholesaling

In the context of controlling middlemen, parallel importing is also known as _____.

Spain

In the context of cultural reactions when engaging in e-commerce, the color red is associated with socialism in _____.

speed of economic development

In the context of distribution patterns, the rate of change in retailing around the world appears to be directly related to the _____.

False

In the context of distribution patterns, wholesaling shows a greater diversity in its structure than does retailing.

False

In the context of distribution structures, one of Walmart's strengths is its ability to influence foreign governments.

False

In the context of the different kinds of middlemen, in 2003, the WTO ruled export management companies to be in violation of international trade rules.

Benetton

In the context of the different types of middlemen, which of the following is an example of a manufacturer's retail store?

False

In the context of the distribution structure in Japan, it has been observed that Japanese consumers favor cheaper prices over personal service.

foreign sales corporations

In the context of types of domestic middlemen, the WTO in 2003 ruled _____ to be in violation of international trade rules, thus starting a major trade dispute with the European Union.

Internal Internet-based system.

In the international business arena, which of the following is considered to be one of Walmart's strengths?

true

In the international communication process, the sender can evaluate the effectiveness of the message with appropriate feedback from the target market.

True

In the traditional distribution structure, independent agencies that provide facilitating functions are nonexistent or underdeveloped.

Direct sales force

In which of the following modes of distribution in the foreign market will a company have to make maximum financial investment?

Mobile Phone Marketing

Includes: 1. ring tone giveaways 2. mobile games 3.ad-suported content 4. contests and sweepstakes

The Need for Integrated Marketing Communication

Integrated Marketing Communications: is the integration by the company of its communication channels to deliver a clear, consistent, and compelling message about the organization and its brands -shift toward a richer mix of media and communication approaches is a problem for marketers. Consumers bombard by many commercials and they don't distinguish. This can result in confused company images, brand positions, and customer relationships -Digital marketing is good because better access to its customers but can be very complex and its a challenge to make it come together in an organized way

Segmenting International Markets

Intermarket segmentation: forming segments of consumers who have similar needs and buying behaviors even through they are located in different countries International Segment by: 1. geographical location 2. economic factors 4.political and legal factors 5.cultural factors

Factors Influencing channel Distribution Decisions (Internal)

Internal Factors: •International market strategy- entry mode and degree of control •Distribution strategy Intensive - distribution in all possible outlets Selective - fewer, selective intermediaries Exclusive - limited number of intermediaries •Product complexity

Which of the following makes Walmart's transactions with suppliers highly efficient and lowers its cost of operations?

Internal Internet-based system

The service Profit Chain

Internal Service Qualities ---> Satisified and Productive Service Employees--> Greater Service Value--> Satisfied and Loyal Customer--> Healthy Service Profits and Growth

False

International advertisers use foreign national consumer magazines extensively because they have dependable circulation figures.

false

Internet purchasing is experience driven in developed countries.

Irritation, Unfairness, Deception, and Fraud

Irritation: include annoying and offending customers Unfairness: includes taking unfair advantages of impulsive or less-sophisticated buyers Deception: includes "heat merchants" who design mailers and write copy design to mislead consumers Fraud: included identity theft and financial scams a. phishing: type of identity theft that uses deceptive emails and fraud online sites to fool users into giving their personal information

lag: consumers learn from the experiences of the adopters in the lead countries.

Is a new product's diffusion rate generally faster in lead countries or lag countries? Why?

________ spend more time on social media sites than any users in any other country.

Israelis

Which of the following statements is true regarding an export management company (EMC)?

It calls for minimum investment from the parent firm to get into international markets.

In the context of integrated marketing communications, which of the following best defines public relations?

It the creation of good relationships with popular press to help communicate messages to their customers, the general public, and governmental regulators.

An export management company

category specialists/ category killers

Large general merchandise discount stores that carry a narrow variety of merchandise and a wide assortment.

False

Legal advice is not necessary when entering distribution contracts with middlemen.

false

Licensing is an international entry mode that presents less risk to the company by offers more control than exporting.

Innovators: Risk takers who can afford to pay a higher price during the introduction stage (2.5% of the total market). Primarily consumers in developed countries. Early adopters: Consumers who purchase the product early in the lifecycle stage and who tend to be opinion leaders in their community (13.5% of the total market). Primarily consumers in developed countries. Early majority: Consumers who enjoy status of being among the first to purchase a popular product (34% of the total market). Consumers are primarily from developed countries. Late majority: Consumers who adopt popular products when the risk associated with them is minimal (34% of the total market). Consumers are from both developed and developing countries. Laggards: The last consumers to adopt a product; they are risk averse and conservative in their spending (16% of the total population). Consumers are primarily from developing countries.

List and briefly describe the five categories of consumer adopters?

consumers competitors channel members employees top management inventors consultants researchers

List four general sources for new product ideas.

product quality performance reliability prestige

List four product characteristics or qualities that perceived country of origin affects.

Manufacturing alliances Marketing alliances Distribution alliances Outsourcing

List four types of strategic alliances.

global standardization regional standardization mandatory adaptation nonmandatory adaptation

List two types of standardization and two types of adaptation.

PR: Lobbying, Investor Relations, and Development

Lobbying: involves building and maintaing relations with legislators and government officials to influence legislation and regulation Investor Relations: involves maintaing relationships with shareholders and others in the financial community Development: involves PR with donors or members of nonprofit organizations to gain financial or volunteer support

Local newspaper that are unable to produce high enough quality in a print ad for a global brand are example of what media challenge? A. media availability. B. media costs. C. media reliability. D. media restrictions.

Evaluating Market Segments

Look at three factors: 1. Segment Size & growth (big or small depending on the power of the company) 2. Segment structural attractiveness (look at competitors, ease for new entrants, substitute products, power of buyers) 3. Company objectives and resources

International Distribution Channel Alternatives

Manufacturer-> Local-> Wholesaler -> retailer-> consumer

Less: Greece= $22.19 Israel= $20.12 Singapore= $19.10 Argentina= $12.66 Slovakia= $10.72 Brazil= $10.08 Hungary= $8.40 Taiwan= $8.36 Mexico= $6.23 Philippines= $1.90 Spain= $26.60 United Kingdom= $29.44 Japan= $31.99 Italy= $33.41 United States $34.74 More: Canada= $35.67 Ireland= $36.30 France= $40.55 Australia= $40.60 Netherlands= 40.92 Finland= $42.30 Germany= $43.76 Denmark= $45.48 Belgium= $50.70 Switzerland= $53.20 Norway= $57.53

Many companies cross borders in search of lower labor costs. Using Table 8-1 based on 2010 figures, list five countries that pay hourly wages for manufacturing less than those wages paid in the United States and five countries with hourly wages more than those paid in the United States.

Marketing Logistics and Supply Chain Management

Marketing Logistics: (physical distribution) invokes planning, implementing, and controlling the physical flow of goods, services, and related information from points or origin to points of consumption to meet consumer requirement at a profit Supply Chain management: is the process of managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers,and final consumers

New Product Development Process (continued)

Marketing Strategy Development: designing the initial marketing strategy for a new product based on the product concept Part 1: first describes the target market, value proposition, sales market plan, and profit goals Part 2: Products planned price, distribution, and marketing budget Part 3: long-run sales, profit goals, and marketing mix strategy Business Analysis: a review of the sales, costs, and profit projections for a new product to find out whether these factors satisfy the company's objective. To do this management looks at the sales of similar products in the market and analyze costs and profits Product Development: Developing the product concept into a physical product to ensure that the product idea can be turned into a workable market offering a. R&D department makes multiple prototypes b. Products tested for safety and effectively c. Tested by actual consumers Test Marketing: The stage of a new-product development in which the product and its proposed marketing program are tested in realistic settings -Used to determine advertising, distribution, pricing, branding, packaging etc. a. Controlled Test markets: new products and tactics are testing among controlled panels of shoppers b. Simulated test markets: researchers measure consumer responses to new products and marketing tactics in laboratory stores or simulated online shopping environments Commercialization: introducing a new product to the market -Marketers must decide on amount of money to spend, when to release product, where to launch the product

Vertical vs. Horizontal conflicts

Marketing channel: consists of firms that have partnered for their common good with each member playing a specialized role Channel Conflict: refers to disagree over goals, roles, and rewards by channel members a. Horizontal conflict: occurs among firms at the same level of the channel ex: ford dealers in chicago might complain that other dealers in the city are stealing sales from them by pricing too low b. Vertical Conflict: conflict between different levels of the same channel ex: KFC and its franchises came into conflict over the company's decision to emphasize grilled chicken

Marlboro was one of the official sponsors of Ferrari's Formula 1 team, endorsing Michael Schumacher. This is an example of A. press release. B. company publications. C. event sponsorship. D. advocacy advertising.

Requirements for Effective Segmentation

Measurable, Accessible, substantial, differentiable, actionable

Who are frequently criticized for not representing the best interests of a manufacturer?

Merchant middlemen

________ take title to manufacturers' goods and assume the trading risks.

Merchant middlemen

False

Merchant middlemen tend to be more controllable than agent middlemen because they take title to manufacturers' goods.

Creating the Advertising Message: Execution

Message Execution: is when the advertiser turns the big idea into an actual ad execution that will the target market's attention and interest -the creative team must find the best approach, style, tone, words, and format for executing the message

Creating the Advertising Message: Message Strategy

Message Strategy: is the general message that will be communicated to consumers 1. identifies consumer benefits 2. follows from company's broader positioning and customer value creation strategies

In Japan, under the Large-Scale Retail Store Law, all proposals for new "large" stores were first judged by the ________.

Ministry of International Trade and Industry

Which of the following is true of the newspaper industry around the world?

Most U.S. cities have just one or two major daily newspapers

Continuous innovations

Most innovation taking place today is of what type?

Continuity

Most middlemen have little loyalty to their vendors. They handle brands in good times when the line is making money but quickly reject such products within a season or a year if they fail to produce during that period. This is an example of problems associated with which of the following six Cs of channel strategy?

Continuity

true

Multinational companies often try to combat counterfeiting by differentiating their products with signature traits.

Myanmar

Selecting Advertising Media: Narrowcasting

Narrowcasting: focuses the message on selected market segments 1. Lowers cost 2. targets more effectively 3. engages customers better

true

Neither merchant middlemen nor agents and brokers carry title to products

New product ideas can be found through a. competitive analyses b. international employees c. international customers d. all of the above

Major Public Relations Tools

News, Speeches, special events, written materials, corporate identity materials, public service activities, buzz marketing, social networking, internet

Steps in Developing Effective Marketing Communication-Non-Personal Communication Channels

Non-Personal Communication: is the media that carry messages without personal contact or feedback, including major media, atmosphere, and events that effect the buyer directly 1. Major Media: include print (newspapers, magazines), broadcast, display, and online media ( company website, email, billboards, signs, posters) 2. Atmospheres: are designed environments that create or reinforce the buyer's leanings toward buying a product (lawyer's offices, banks,etc) -Events are staged occurrences that communicate messages to target audiences 1. press conferences 2. grand openings 3. exhibits 4. public tours

Setting the Total Promotion Budget and Mix-Objevtive-and-task method

Objective-and-task-method: sets the budget based on what the firm wants to accomplish with promotion and includes -defining the promotion objectives -determining tasks to achieve the objectives -estimating costs -advantages: forces management to spell out assumptions -most difficult method because often hard to figure out which specific tasks will achieve the stated objectives

Sales Promotion Objectives

Objectives Include -consumer promotions (urge short term customer buying and build relationships) -trade promotions -business promotions -sales force promotions

True

Of all the elements of the marketing mix, decisions involving advertising are those most often affected by cultural differences among country markets.

false

One of the benefits of franchising is that it keeps out new competitors.

True

One of the drawbacks of satellites is also their strength, that is, their ability to span a wide geographical region covering many different cultures.

Dr. Mark Townes is a dentist practicing in Denver. During a four-day stretch in March, it snowed so heavily that not a single patient was able to visit him. Since all the appointments were missed, he did not make any money for those four days, even though his normal expenses remained. Which of the following characteristics of services is affecting Dr. Townes' business

Perishability

have little loyalty to their vendors

One of the reasons that channels of distribution often pose longevity problems is that most middlemen _____.

Other Sales Force Strategy and Structure Issues

Outside Salespeople: call on customers in the field, travel Inside Salespeople: conduct business from their offices and often provide support for the outside salespeople, via telephone, internet, visits from buyers -on average about $350 per sales call Team Selling: products become more complex and as customers grow larger and more demanding, a single salesperson can't handle demand. Used to service large, complex accounts. Teams can unearth problems. solution, and sales opportunities that a single person can't do.

true

Outsourcing involves the strategic use of outside resources to preform activities that are usually handled by internal staff and resources.

true

Overlapping media among countries makes it easier to create awareness of a product

Apple Computer had difficulties when it first entered the Japanese market with its Macintosh computers. Some of the computers were returned unused after customers found the wrapping on the instruction manual damaged. Though this would probably be no big deal in the U.S., it was certainly a cause for concern in quality-conscious Japan. To fix the problem, Apple needed to concentrate on which of the following components of the product component model?

Packaging component.

Apex Corp. is a wholesaler for Global Electronics in the French market. Global Electronics discovered that Apex Corp. was diverting some of its goods to the English market. Apex Corp. could get a greater profit in the English market because the goods were bought by the firm at a cheaper price in France. In the context of the above scenario, which of the following forms of business is Apex engaged in?

Parallel importing

Steps in Developing Effective Marketing Communication-Choosng Media (Personal Communication)

Personal Communication: involves two or more people communicating directly with each other (ex: face to face, phone, mail, email, internet chat) -good b/c allow for personal addressing, feedback Control of Personal Communication 1. Company 2. Independent Experts 3. Word of Mouth

Personal Selling

Personal Selling: is the interpersonal part of the promotion mix and can include: -Face to face communication -telephone communication -video or web conferencing

Philips is headquartered in the Netherlands, but many of its appliances are manufactured in Asia. The country of origin of Philips a. is the Netherlands d. is the country in Asia where the product is manufactured c. depends on the perception of the consumer. d. none of the above

Marketing Channels Create Utility for Customers

Place utility - availability of a product or service in a location that is convenient to a potential customer Time utility - availability of a product or service when desired by a customer Form utility - availability of the product processed, prepared, in proper condition and/or ready to use Information utility - availability of answers to questions and general communication about useful product features and benefits

Selecting Advertising Media: Media Timing

Planner must consider 1. Seasonality 2. Pattern of the advertising a. continuity: scheduling evenly within a given period b. pulsing: scheduling unevenly within a given period: feel that this pattern can have same effect as stead advertising but at much lower cost, can sacrifice depth of advertising communications

Porsche helping Harley-Davidson to produce its water-cooled revolution engine is an example of which type of strategic alliance? a. distribution b. marketing c. manufacturing d. none of the above

Press Relations or Press Agency, Product Publicity, Public Affairs

Press Relations or Press Agency: involves the creation and placing of newsworthy information to attract attention to a person, product, or service Product Publicity: involves publicizing specific products Public Affairs: involves building and maintaing national or local community relations

High Cost of Distribution

Prices are too high because ; 1. distribution 2. advertising and promotion 3. excessive mark-ups Response; 1. intermediates are important 2. advertising informs buyers of availability and merits of brand 3. Consumers dont understand the cost of doing business

Public Policy and Pricing

Pricing within channel levels: 1. Price fixing: the agreement between competitors on a price, Sellers must set prices without talking to competitors. 2. Predatory Pricing: selling below cost with the intention of punishing a competitor or gaining higher long-run profits by putting competitors out of business Pricing across channel levels: 3.Price Discrimination: the Robinson-Patman Act, Sherman Act, and Clayton ACt seeks to prevent this by ensuring that sellers offer the same terms to customers at a given level of trade. Acts help to curb formation of monopolies and regulate business practices. a. retail (or resale) price maintenance: a manufacturer can't require dealers to charge a specified (fixed) retail price for its products 4. Deceptive Pricing: occurs when a seller states prices or price saving that mislead consumers or are not actually available to consumers

________ allows ESPN to fill visual real estate-blank walls, streets, stadium sidings-with computer-generated visuals that look like they belong in the scene

Princeton Video Imaging

True

Problems of literacy, media availability and types of media create problems in the international communications process at the encoding step.

Define Differentitation and Positioning

Product PosistionL the way a product is defined by consumers on important attributes

Promoting its products globally and altering parts of their promotion based on specific areas is common of a company focused on a. nonmandatory adaption b. global standards c. globalization or global localization d. none of the above

Public Relations

Public Relations: involves building good relations with the company's various public by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events -PR used to promote product, people, ideas, and activities

Public relations

Reach, Frequency, and Impact

Reach: is a measure of the percentage of people in the target market who are exposed to the ad campaign during a given period of time (ex: marketers trying to reach 70% of targeted audience) Frequency: is a measure of how many times the average person in the target market is exposed to the message (ex:example marketer might want average exposure of 3) Impact: is the qualitative value of a message exposure through a given medium

contract manufacturing

Relationship between 2 companies wherein one company contracts with another to manufacture products according to the contracting company's specifications and for a specified amount of time

Distribution Channels -Whole Channel View

Seller's headquarters organization: supervises the channel and is also a part of the channel Channels between nations: move the product to the borders of the foreign nations Channels with nations: move the products from their foreign point of entry to the final customers

Retailers that offer a narrow product line and a wide assortment- for example, office supply stores- are examples of A. specialized markets. B. specialty stores. C. department stores D. all-purpose discount stores.

Evaluating the Effectiveness and Return on Advertising Investment

Return on Advertising Investment: the net return on advertising investment divided by the costs of the advertising investment Advertisers should regularly evaluate 1. Communication effects 2. Sales and Profit Effects

In the context of international advertising, companies are moving from the commission system to a _____ system.

Reward by results

Sales and Profit Effects

Sales and Profit Effects: compare past sales and profits with past expenditures or through experiments -harder to measure -one way is to compare past sales and profits with past advertising expenditures -another way is through experiments

Supervising and Motivating Salespeople

Sales moral and performance can be increased by: 1. Organizational Climate: describes the feeling that salesperson have about their opportunities, value, and rewards for a good performance 2. Sales Quotas: standards stating the amount they should sell 3. Positive incentives: bonus', sales meetings, sales contests

_____ are short-term efforts directed to the consumer or retailer to achieve such specific objectives as consumer product trial or immediate purchase.

Sales promotion

False

Sales promotions are long-term IMC efforts directed to the consumer or retailer.

True

Sales promotions are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.

True

Sales promotions constitute the major portion of the promotional effort in rural and less accessible parts of a market.

The Nature of Personal Selling

Salespeople: are an effective link between the company and its customers to produce customer value and company profits by: -representing the company to customers -representing customers to the company -working closely with marketing (arranging joint meetings, spelling out communication channels,etc)

Sales Force Size

Salespeople: one of the company's most productive and expensive assets -increase in sales force size can increase sales and costs Workload Approach to sales force size: refers to grouping accounts into different classes to determine the number of salespeople needed. Company first groups according to size, account status, or other factors related to amount of effort required to maintain the account. Then determines the number of salespeople needed to call on each class of accounts the desired number of times.

Selecting Advertising Media: Selecting Media Vehicles

Selecting Media Vehicles: involves decisions presenting the message effectively and efficiently to the target customer and must consider the message's: 1. Impact 2. Effectiveness 3. Cost -Planner must consider the cost of the media as compared to its effectiveness by evaluating: 1. audience quality 2. audience engagement 3. editorial quality -media multi-taskers: people who absorb more than one medium at a time (ex: watching TV while on computer)

The Webb-Pomerene Act of 1918 made it possible for American business firms to join forces in export activities without being subject to the ________.

Sherman Antitrust Act

Societal Marketing

Societal Marketing: company makes decisions by considering consumers wants, companies requirements, and consumers long run interests, and societies long run interests Deficent products: bad-tasting, ineffective Pleasing products high immediate satisfaction but may hurt in long run Salutary Product: having low immediate appeal but may benefit consumers in long run Desirable Product: high immediate satisfaction and high long run benefits IMEDIATE SATISFACTION Low High Low Salutary Desirable High Deficient Pleasing (Long -Run Consumer Benefit)

global standardization

Standardization of products across markets and, ultimately, the standarization of the marketing mix worldwide

Selecting Advertising Media Steps

Steps include: 1. Deciding on,reach,frequency, and impact 2. selecting media vehicles 3. deciding on media timing

Deciding on the Global Marketing Program- Product

Straight Product Extension: means marketing a product in a foreign market with out any change Product Adaption: involves changing the product to meet local conditions or wants Product Invention: consist of creating something new for a specific country market -maintain or reintroduce earlier products -create new products

Industry Structure

Structure A. Subsistence Economies: majority people engage in simple agriculture, consume most of their output and have rest for simple goods and services. Offer few market opportunities . (ex: african communities) B. Raw Material Exporting Economies: economies are rich in one or more natural resource but poor in other ways. Revenue comes from exporting these resources. Good for large equipment, tools and supplies, and trucks. C. Emerging Economies: fast growth in manufacturing results in a rapid overall economic growth, examples include BRIC countries (Brazil, Russia, India, China) D. Industrial Economies: major exporters of manufactured goods, services, and investment funds

Which of the following actions should be taken to begin the search for prospective middlemen?

Studying the target market

Domestic middlemen are most likely to be used when the marketer desires to minimize financial and management investment.

TRUE A major trade-off when using home-country middlemen is limited control over the entire process. Domestic middlemen are most likely to be used when the marketer is uncertain or desires to minimize financial and management investment.

Errors at the receiver end of the international communications process can be avoided if the message is encoded properly.

TRUE Errors at the receiver end of the process generally result from a combination of factors: an improper message resulting from incorrect knowledge of use patterns, poor encoding producing a meaningless message, poor media selection that does not get the message to the receiver, or inaccurate decoding by the receiver so that the message is garbled or incorrect

Competitive advertising is a source of noise in the international communications process.

TRUE Noise comprises external influences such as competitive advertising, other sales personnel, and confusion at the receiving end that can detract from the ultimate effectiveness of the communication.

One of the drawbacks of satellites is also their strength, that is, their ability to span a wide geographical region covering many different cultures.

TRUE One of the drawbacks of satellites is also their strength, that is, their ability to span a wide geographical region covering many different country markets. That means a single message is broadcast throughout a wide area. This span may not be desirable for some products

Problems of literacy, media availability, and types of media create problems in the international communications process at the encoding step.

TRUE Problems of literacy, media availability, and types of media create challenges in the communications process at the encoding step.

Sales promotions are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.

TRUE Sales promotions are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.

In the context of retail patterns, direct marketing works well in affluent markets as well as in markets with underdeveloped distribution systems.

TRUE Selling directly to the consumer through mail, by telephone, or door-to-door is often the approach of choice in markets with insufficient or underdeveloped distribution systems. The approach, of course, also works well in the most affluent markets.

The feedback step of the international communications process is important as a check on the effectiveness of the other steps.

TRUE The feedback step of the communications process is important as a check on the effectiveness of the other steps.

In the context of advertising, a marketer's self-reference criterion (SRC) affects the ultimate success of the communication.

TRUE The international communications model's significance is that one or all steps in the process, cultural factors, or the marketer's self-reference criterion (SRC) can affect the ultimate success of the communication.

In the context of international advertising, search engines have now become crucial directors of Internet users' attention.

TRUE The sheer proliferation of the number of websites makes it increasingly difficult for a customer to stumble across a particular page. Search engines have now become crucial directors of Internet users' attention.

Which of the following, according to experienced exporters, is the only way to select a middleman?

Talk personally to ultimate consumers to find whom they consider to be the best distributors

Tariffs and Quotas

Tariffs: taxes on certain imported products designed to raise revenue or to protect domestic firms Quotas: limits on the amount of foreign imports a country will accept in certain product categories to conserve foreign exchange and protect domestic industry and employment

True

The behavior of channel members in the distribution process is the result of the interactions between the cultural environment and the marketing process.

False

Television is an advertising medium where there are no restrictions in most countries.

true

Test marketing has a number of disadvantages: it is expensive, time consuming, and subjects the company to competitive sabotage.

false

The European Union Directive Concerning Television Broadcasting limits all advertising of tobacco and prescription drug products in all media.

True

The Export Trading Company Act allows producers of similar products to form export trading companies in the U.S.

False

The Japanese distribution structure is similar to the one found in the U.S. or in Europe.

Which of the following statements is true of the Japanese market?

The Japanese distribution structure supports long-term dealer-supplier relationships

The Sherman Antitrust Act

The Webb-Pomerene Act of 1918 made it possible for American business firms to join forces in export activities without being subject to which of the following acts?

Different cultures often seek the same value or benefits from the primary function of a product.

True

Which of the following is true of a company that views prices as an active instrument of accomplishing marketing objectives?

The company sets prices to achieve specific objectives.

Which of the following is true of advertising agencies for international advertising?

The cross-cultural communication between a foreign client and a local agency can be problematic.

Final Consumer

The distribution channel process includes all activities, beginning with the manufacturer and ending with the _____.

False

The distribution channel process includes all activities, beginning with the manufacturer and ending with the retailer.

False

The distribution process includes promotion of goods and services by sellers and resellers.

True

The feedback step of the international communications process is important as a check on the effectiveness of the other steps.

The following is an example of mandatory adaption for the United States market: a. U.S. automobile emission standards b. 110 volts c. NTSC television d. all of the above

The iPhone is relatively expensive. Companies are presently selling them to consumers in industrialized countries. In which stage of the international product life cycle is the iPhone? a. product introduction b. growth stage c. maturity stage d. decline stage

Which of the following statements is true regarding an import-oriented distribution structure?

The importer-wholesaler traditionally performs most of the marketing functions.

true

The main purpose of public relations is to generate positive publicity about a company.

The many different flavors of the Unilever's Ben & Jerry's a. product length b. product width c. product depth d. all of the above

Which of the following statements is true of a traditional distribution structure?

The marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers.

The three main retail formats are A. general merchandise, food, and nonstore. B. automotive, food, and nonstore. C. general merchandise, automotive, and luxury. D. none of the above

Which of the following statements is true of sales promotions?

They are marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation.

Which of the following statements is true regarding merchant middlemen?

They assume trading risks.

Which of the following is true of foreign sales corporations?

They can function as principal or commissioned agents.

Which of the following is the reason why global retailers like IKEA, Costco, Sears Roebuck, and Walmart are becoming major domestic middlemen for international markets?

They maintain their core marketing approaches while localizing the array of products, promotions, and other peripheral aspects of their operations.

Which of the following statements is true regarding agent middlemen?

They work on commission and arrange for sales in the foreign country.

Designing a Message-forms

Three types of appeals 1. Rational: relates to audiences self-interest, show product will produce desired benefits (ex: weight watchers) 2. Emotional: attempt to sure up positive or negative emotions to motivate purchase, like love/joy/humor, humor is the most effective in getting people to talk and rewatch 3. Moral: directed at the audience's sense of right and proper, try and get people to support social causes Format -needs a strong format for the message -one study suggests that color increases brand recognition by up to 80% (ex: target, mcdonalds, UPS)

Errors at the receiver end of the international communications process do not occur if the message is encoded properly.

True

Creating the Advertising Message: Tone

Tone: -positive or negative -attention-getting words -Format a.illustration b. headline c. copy: simple but strong and convincing

Which of the following statements about advertising laws around the world is correct?

Toy, tobacco, and liquor advertising is restricted in numerous countries.

True

Trading companies provide the best means for intensive coverage of the market.

True

Traditional channels in developing countries evolved from economies with a strong dependence on imported manufactured goods.

false

Truck transportation handles larger shipments over longer distances.

A reason for the failure of marketing communications is that the message received by the intended audience is not understood because of different cultural interpretations.

True

Competitive advertising is a source of noise in the international communications process.

True

False

Uncontrollable and unpredictable influences such as competitive activities and confusion that detract from the process of communication are called feedback.

true

Using established channels can be costly for multinational firms, but paying the high price may also erect barriers to entry for competitors

False

Using foreign-country middlemen moves the manufacturer away from the market and the company becomes less involved with problems of language, physical distribution, communications, and financing.

What company was responsible for initiation a countertrade relationship with the Soviet Union in the late 1960s? A. McDonald's B. Pepsi C. Philip Morris D. none of the above

IOS 9000: specifies that the organization must meet customer and regulatory requirements and follow its policies and procedures while advancing quality through continuous improvement IOS 14000: certification that a company follows guidelines that discourage firms from engaging in hazardous environmental practices.

What do ISO 900o standards pertain to? What do ISO 14000 standards pertain to?

Wholly Owned Subsidiary

What entry mode affords the highest level of control but also presents the highest level of risk to the international firm?

Vending machines constitute a primary mode of retailing in A. the United States. B. the Netherlands. C. Japan. D. Canada.

true

Wal-Mart and Tesco products sold under the respective company's umbrella name are known as private-label brands.

Walmart and Target are all examples of A. category specialists B. specialized markets C. all-purpose discount stores. D. specialty stores.

homogeneous consumer group worldwide sharing similar interests and product/brand preferences.

What are "global consumers"? What are two reasons why today's global consumers share common product/brand preferences?

merchant middlemen agents and brokers

What are the two broad categories of foreign-country (host-country) middlemen? What is the main difference between the two?

design counterfeiting *brand-name counterfeiting

What are the two types of counterfeiting? Which type of counterfeiting do you consider to be more serious? Why?

1. develop its own subsidiary (greenfielding) 2. it can purchase an existing company through acquisition or mergers.

What are the two ways a company can develop a wholly owned subsidiary?

What aspect of international distribution and logistics is facilitated by containerization? a. distribution research b. freight forwarding c. intermodal transportation d. government agencies

What city hosted World Fair Expo 2010? A. San Francisco B. London C. Shanghai D. Munich

Continuity

Which of the following is one of the six Cs of distribution channel strategy?

contract manufacturing is when two companies pair up to manufacture and sell a product; whereas outsourcing is the strategic use of outside companies to preform a service. Asia: financial services, telecom, software, retailers. India is popular for the low-cost, educated, and English-speaking labor force of about 159 million

What is the difference in contract manufacturing and outsourcing? List four types of service jobs that have been outsourced to Asia. Why is India a popular country for the outsourcing of U.S. service-sector jobs?

France

What is the home country of Groupe Danone SA? In what country did Groupe Danone enter into a joint venture with Wahaha? What percentage of the joint venture was owned by Groupe Danone?

it is cheaper to have the same product and the same integrated marketing communication strategy worldwide. and standardization is possible because consumers increasingly have the same product preferences.

What is the main reason firms favor global standardization over adaptation?

International firms: expertise, know-how, most of the capital, the brand name reputation, and physical infrastructure (such as the factory and access to the factory) Local partner: labor, the physical infrastructure (such as the factory and access to the factory), local market expertise and relationships, as well as connections to government decision- making bodies.

What manner of resources are usually contributes to a joint venture by an international firm and what resources are typically provided by the local partner?

What percent of Europeans and U.S. consumers make their purchase decisions at the point of sale? A. 50 B. 60 C. 30 D. none of the above

What services do Japanese trading companies offer their supplier? a. risk reduction b. specialization in intermediary services c. financial assistance d. all of the above

What type of countertrade involves buying a party's position in a countertrade in exchange for hard currency and selling it to another customer? A. compensation B. switch trading C. counter purchase D. offset purchase

When a company screens new product ideas, what are the most important factors to consider? a. unique benefits to users b. product requirements versus resource c. narrowly specified target markets d. a and b

False

When a marketing executive advertises his product in a newspaper, the newspaper acts as a feedback channel.

False

When a message from the source is converted into effective symbolism for transmission to a receiver, the message is said to have been decoded.

When quality cannot be guaranteed, either because the licensee doe not allow the licensor sufficient control and scrutiny or because the licensee cannot guarantee quality.

When is it preferable for products produced under license NOT to carry the licensor's brand name?

Which government agency offers export assistance to international firms and, in particular, to small to medium- sized businesses a. U.S. department of state b. bureau of export administration c. U.S. trade and development agency d. international trade administration

Which of the following are examples of products that businesses purchase? a. major equipment, buildings, land b. accessory equipment and fabricated and component parts c. process material and maintenance and repair parts d. all of the above

Complementary marketing

Which of the following arrangements are undertaken when a firm wants to keep its seasonal distribution channels functioning throughout the year?

Loyalty

Which of the following characterizes the business philosophy of the Japanese distribution channels?

Which of the following constitutes a possible strategy to combat parallel imports? a. charging similar prices worldwide b. complicating the repair process for parallel imports c. informing customers of problems when buying gray market products d. all of the above

China

Which of the following countries has the largest number of retailers?

Import-oriented

Which of the following distribution structures is also known as a traditional distribution structure?

Available distribution intermediaries

Which of the following factors affects the choice of distribution channels?

Direct sales through catalogs

Which of the following has proved to be an important way to break the trade barrier imposed by the Japanese distribution system?

Merchant middlemen

Which of the following has proved to be an important way to break the trade barrier imposed by the Japanese distribution system?

Cash-flow patterns

Which of the following is a critical element associated with using a particular type of middleman?

Which of the following is a nonpersonal medium of the International Communication Process? A. personal selling. B. trade shows. C. television. D. telemarketing.

Which of the following is a reason for the failure of joint ventures? a. natural disasters b. poor performance by a partner c. partners becoming competitors d. all of the above

Which of the following is an example of sales promotion can be varied from one market to another? A. local campaigns. B. modular campaigns. C. global campaigns. D. none of the above.

Which of the following is an example of sales promotion? A. product tie-ins. B. free samples C. cents-off D. all of the above

Which of the following is correct about using international middlemen? a. they increase company control over marketing strategy. b. they subject the company to less risk than direct international involvement. c. they maximize control for the company in the target market. d. all of the above

Which of the following is not an example of media restriction? A. prohibiting advertising to children. B. prohibiting the advertising the vice products. C. keeping the local language pure. D. all of the above.

Capital required to maintain effective distribution

Which of the following is one of the highest costs of doing business in China?

Small retailers

_____ are considered to be the foundation of the Japanese distribution system.

The Japanese distribution structure

_____ has long been considered the most effective nontariff barrier to the Japanese market.

Productivity

_____ is an area that should be on a checklist of criteria for evaluating middlemen servicing a market.

Direct marketing

_____ is often the approach of choice in markets with insufficient or underdeveloped distribution systems.

Merchant middlemen

_____ take title to manufacturers' goods and assume the trading risks.

manufacturer's representative

an agent who represents the manufacturer exclusively in the foreign target market.

keiretsu

a Japanese trading firm that consists of families of firms with interlocking stakes in one another

executive-judgment method

a budgeting process that allocates the company's advertising budget based on the opinions of executives.

nonpersonal medium

a channel of communication such as a print medium, a broadcast medium, or an interactive medium that does not involve contact between the seller and the consumer.

personal medium

a communication channel of communication that involves a salesperson calling on consumers.

consortia

a company created with the participation of three or more companies; allowed in undeserved markets or in domains where the government and the marketplace can control its monopolistic activity.

clearing account/ clearing agreement

a complex form of countertrade whereby countries trade products up to a certain amount stated in a particular, mutually agreed-on hard currency and within a given time frame, and, when an imbalance occurs and one country owes money to the other, swing credits are paid in an greed-on hard currency.

international product life cycle (IPLC)

a product life cycle theory, which states that firms from developed countries engage in domestic production in the early stage of the product life cycle, marketing the product to industrialized countries; as the product reaches maturity, product specifications and the manufacturing process stabilize, price competition becomes intense, and markets in developing countries become essential to the firms success

new product to existing market

a product never before offered to the market

innovation

a product new to the world

false

a product's country of origin is always the country where the product was manufactured.

infant industry argument

a protectionist strategy aimed at protecting a national industry in its infancy from powerful international competitors.

What is a target market

a set of buyers sharing common needs of characteristics that the company decides to serve

barter

a simple, nonmonetized exchange of goods and services between two parties.

maturity stage

a stage of the IPCL characterized by a slowdown in sales growth as the product is adopted by most target consumers and by a leveling or decline in profits primarily due to intense price competition

corporate advertising

a type of advertising that is used to promote the company behind the different brands.

interactive home shopping

a venue for selling through the internet using web sites to increase market penetration and market diversification; also called electronic retailing and internet retailing.

global campaign

a worldwide standardized advertising campaign that is not adjusted to different target markets.

trialability

ability of the consumer to experience a product with minimal effort

billboards

advertisements in public areas appearing on large posters or electronic panels.

Of all the elements of the marketing mix, decisions involving ________ are those most often affected by cultural differences among country markets.

advertising

advocacy advertising

advertising a particular position or point of view.

________ are the major components in the marketing communications mix for most companies.

advertising and personal selling

Setting Advertising Objectives

advertising objective: specific communication task to be accomplished with a specific target audience during a specific time -objectives based on past decisions about target market, positioning, and the marketing mix. Overall objective is to help building consumer relationships by communicating customer value -objectives classified by their objectives; to inform, persuade, or remind

________ in countries can distort media choice by changing the cost ratios of various media.

advertising taxation

manufacturer's export agents

agents in the firm's home country handling the exporting function of a certain manufacturer on a commission, per deal, basis.

true

aggressive export pricing involves pricing products below market price to penetrate new markets.

cooperative export arrangements

agreements that involve the use of distribution system of exporters with established system of selling abroad, who agree to handle the export function of a noncompeting (but not necessarily unrelated) company on a contractual basis; also called mother henning or piggybacking

buyback agreements

agreements whereby the seller builds and provides a turnkey plant and is paid up front part of the cost of the plant in an agreed-on convertible currency; in return, the seller agrees to purchase specific quantities of the plant's output over an extended period of time.

product line

all the brands the company offers in the same product category

noise

all the potential interference in the communication process.

swing credits

amounts paid within the framework of a clearing agreement by the country that owes money to the other when an imbalance occurs.

objective-and-task method

an advertising budgeting method in which the company first identifies advertising goals, conducts research to determine the cost of achieving the respective goals, and allocates the necessary sum for the purpose.

percent-of-sales method

an advertising budgeting method that determines the total budget allocated to advertising on the basis of past or projected sales.

image advertising

an advertising campaign that enhances perceptions of a company in a given market by creating a positive impression on the target consumers.

local campaign

an advertising campaign that is tailored to local needs; especially used in markets that media cannot easily reach.

modular campaign

an advertising campaign that provides a template that is varied and customized from market to market.

general merchandise discount stores

retailers that sell high volumes of merchandise, offer limited service, and charge lower prices

In the context of the different types of middlemen, which of the following is an example of a manufacturer's retail store?

benetton

Companies with marketing facilities or contacts in different countries with excess distribution capacity or a desire for a broader product line sometimes take on additional lines for international distribution. The formal name for such activities is ________.

complementary marketing

performing a product business analysis

calculating projected costs such as return on investment and cash flow and determining the fixed and variable costs for the long term

ISO 14000 certification

certification that a company follows guidelines that discourage firms from engaging in hazardous environmental practices, and ensures that corporate polices promoting environmentally sound, efficiency-embracing, innovative technologies and processes will contribute to establishing twenty-first century production and distribution systems that are far less environmentally degrading

ISO 9000 certification

certification that specifies that the organization must meet customer and regulatory requirements and follow its policies and procedures while advancing quality through continous improvement

Great Britain has epitomized distribution through specialty-type middlemen, distributors, wholesalers, and retailers. In recent years, however, there has been a trend toward broader lines, conglomerate merchandising, and mass marketing. This suggests that a firm that neglects the growth of self-service, scrambled merchandising, or discounting may find that it has lost large segments of its market only because its channels no longer reflect the ________ of the market

character

The emergence of pan-European communications media will most likely cause companies to:

choose more standardized promotional efforts.

In the context of integrated marketing communications, in many markets, the availability of appropriate _____ to customers can determine entry decisions.

communication channels

export management companies

companies specializing in the export function for client companies in a particular industry.

public appearances

company representatives' public involvement, speaking on behalf of the international firm and its products.

Mark Harmon has found that using his new digital camera is a snap. He did not even have to read the instruction manual to determine how to turn the camera on, snap a digital picture, and export the picture to his computer. The signs (symbols) on the camera body made it very clear what he was to do to achieve digital photography success. Which of the following characteristics of Mark's "new product" made it easy for him to begin his digital experience?

complexity

Sales promotions are short-term efforts directed to the consumer or retailer to achieve specific objectives such as:

consumer product trial or immediate purchase.

laggards

consumers who are the last to adopt new products and do so only in late maturity because they are risk averse and conservative in their spending; they account for 16% of the total market

early majority

consumers who enjoy the status of being among the first in their peer group to purchase a popular product; they account for 34% of the total market

early adopters

consumers who purchase a product early in its product life cycle and who tend to be opinion leaders in their communities who take risks, but with greater discernment than innovators. They account for 13.5% of the total market

continuity

food retailers

conventional supermarkets, superstores, warehouse clubs (wholesale clubs), convenience stores.

design counterfeiting

copying designs or scents of another company

lag countries

countries where a product or services is adopted after already being introduced in lead countries

false

countries with a shortage of soft currency reserves are more likely to engage in countertrade

In the context of consumer products, which of the following is the major limitation of the Internet?

coverage of the internet

building channels

creating new distribution channels, especially necessary in situations where there are no channels at all, or there are no channels that conform to the needs of the company.

radical innovation

creation of new industries or new standards of management, manufacturing, and servicing that represent fundamental changes for consumers, entailing departures from established consumption

off-price retailers

retailers who sell brand name products and designer merchandise below regular retail prices.

developing and evaluating concepts

determining how consumers will perceive and use a new product;a step in the new product development process

Deciding how to Enter the Market

determine best mode of entry 1. Exporting: when company produces its goods in the home country and sells them in foreign market. A. Indirect exporting: usually start with this, working through independent international marketing intermediaries. Less risk. B. Direct Exporting: handle their own exports. Risk are somewhat greater. Advantage: simplest means and involves least change in the companies product lines, organization, investment, or mission 2. Joint Venturing: when a firm joins with a foreign company to produce or market products or services A. Licensing: enters market by coming up with an agreement with a licensee in the foreign market. Less control over the licensee and if very successful they give up some profits and potential competitor. B. Contract Manufacturing: when a firm contracts with manufactures in the foreign market to produce its product or provide its service. Faster startup, less risk, opportunity to form partnership or buy out local manufacturer. Drawbacks include decreased control over manufacturing process and loss of potential profits and manufacturing. C. Management contracting: when the domestic firm supplies management skills to a foreign company that supplies capital. Firm is exporting management services rather than products. (ex: Hilton hotels) D. Joint Ownership: when one company joins forces with foreign investors to create a local business in which they share joint ownership and control. 3. Direct Investment: development of foreign-based assembly or manufacturing facilities and offers a number of advantages including labor, logistics, control, government incentives, lower costs, raw material. Disadvantages is it is risky, lower currencies, falling economy,etc.

Economic Environment Factors

economic factors reflect a country's attractiveness as a market 1. Industry structure 2. income distribution

screening new product ideas

eliminating product ideas that do not fit with the target consumers and the overall mission of the organization

encoding

In the context of the communications process in advertising, problems of literacy, media availability, and types of media create challenges in the communications process at the ________ step.

encoding

information source selection

dynamically continuous innovation

innovation that does not alter significantly consumer behavior but still entails a change in the consumption pattern

vending machines

interactive modes of retailing convenience goods.

home- country intermediaries

intermediaries in the home country.

brokers and agents

intermediaries who bring international buyers and sellers together; they do not carry title to the product.

foreign- country intermediaries

intermediaries who help distribute products in a target foreign market.

export merchants

intermediaries who take title to and possession of the products they carry; they are responsible for shipping and marketing the products to the target market.

hypermarkets

large retail stores that combine supermarket, discount, and warehouse retailing principles.

superstores

large retailers such as combination stores or hypermarkets that sell food, drugs, and other products.

A wine company had to market its products with a different name in a foreign market as it was mandatory to translate the name in the local language. The factor that is influencing product adaptation in the above scenario is _____.

legal requirements

export trading company (ETC) act

legislation, passed in 1982, that encourages the formation of export trading companies by competing firms to promote U.S. exports without violating antitrust regulation.

Companies that rely on television infomercials and television shopping are restricted by the limitations placed on the ________ of television commercials permitted when their programs are classified as advertisements.

length and number

The advantages of ____, a market-entry strategy, are most apparent when capital is scarce, import restrictions forbid other means of entry, a country is sensitive to foreign ownership, or patents and trademarks must be protected against cancellation for nonuse.

licensing

modular adaptation

localization across markets of the product by offering parts that can be assembled worldwide in different configurations depending on the needs of the market

infomercials

long television advertisements (one-half to one full hour in length) that are positioned as programming.

Which of the following characterizes the business philosophy of the Japanese distribution channels?

loyalty

A ________ provides a selling service for a manufacturer, has a short-term relationship, and operates on a straight commission basis.

manufacturer's export agent

A(n) ________ is an individual agent middleman or an agent middleman firm providing a selling service for manufacturers that covers only one or two markets.

manufacturer's export agent

Using newspapers or magazine ads as a channel of communication when the majority of the intended users are illiterate is an example of ineffective ________ in the communications process.

media channel selection

Creating the Advertising Message

need to break through the clutter: 1. Gain attention 2. Communicate Well * today average household receives about 135 channels *consumers are exposed to as many as 3000-5000 commercial messages every day *TV advertisers pay an average of $324,000 to produce a single 30-sec commercial then each time they show it its $122,000 for 30 secs - consumers only watch about 40% of all advertisements -Advertisers need to be better planned, more imaginative, more entertaining, and more rewarding to consumers -Merging Advertising and Entertainment: many marketers have subscribed to a new merging of advertising and entertainment called "Madison & Vine" -Branded Entertainment: involves making the brand an inseparable part of some other form of entertainment. Most common form of branded entertainment is product placements- embedding brands as probs within other programming

While developing an international advertisement campaign, which of the following is the first step of the process?

perform marketing research

Complementary marketing is commonly known as ________.

piggybacking

Integrated marketing communications are composed of all of the following EXCEPT:

political rallying

A company uses _____ when the objective is to reach a segment of the market that is relatively price insensitive and thus willing to pay a premium price for the value received.

price skimming

penetration pricing

pricing strategy in which a product is first priced below the price of competitors' products to quickly penetrate the market at the competitors expense and then raised to target levels.

skimming strategy

pricing strategy in which a product is priced above that of competitor's products, when competition is minimal; consumers responding to skimming strategies are more concerned with quality, uniqueness, and status, rather than pricing

aggressive export pricing

pricing strategy that prices products below market price to penetrate new markets.

dynamic incremental pricing

pricing strategy whereby a company assumes that it will have certain fixed costs whether or not it exports its products over

In Spain, a new medium for advertising called Publicoche includes:

private cars that are painted with advertisements.

________ are considered to be major communications media in most countries due to their inherent entertainment value.

radio and television

Certain advertising media are forbidden by government edict to accept some advertising materials. Such restrictions are most prevalent in:

radio and television broadcasting.

In the communications process in advertising, during the ________ stage, a consumer takes certain actions to respond to a decoded message.

receiver

international promotional mix

the different modes of communication with international consumers about products and services, using international avbertising, international sales force management, international sales promotion, public relations, and publicity.

wholly owned subsidiary

the entry mode that affords the highest level of control and presents the highest level of risk to a company; it involv

media availability

the extent to which media are available to communicate with target consumers.

product consistency

the extents to which a companies different product lines are related, use the same distribution channels, and have the final consumers

introduction stage

the first stage of the IPLC when products are developed and marketed in industrialized countries

________ suffer(s) from issues such as difficulty in assessing taxes, unfair competition, import duties, and privacy.

the internet

Direct mail is an unpopular medium in Chile because:

the letter carrier must collect additional postage for every item delivered.

franchising

the main international entry mode for the service industry, whereby the franchisor gives the franchisee the right to use its brand name and all related trademarks in return for royalties.

media infrastructure

the media vehicles and their structure in an international target market.

channel of communication

the medium used to communicate a message about a product to the consumer.

licensor

the owner of a product license who agrees to share know-how, technology, and brand name with the licensee in return for royalties

franchisor

the owner of the franchise who gives the franchisee the right to use its brand name and all related trademarks and its business know- how, such as secret recipes and customers interfacing techniques, in return for royalties.

compensation

the payment in products and cash, usually in a mutually agreed-on convertible currency.

licensee

the purchaser of the license who pays royalties to the licensor for the rights to use the licensor's technology, know- how, and brand name.

franchisee

the recipient party to a franchise who pays royalties in return for the right to use the franchisor's brand name and related trademarks.

sender

the sponsor of an advertisement, usually represented by an advertising agency, who encodes the message into words and images and communicates it to the target market.

growth stage

the stage of the IPLC characterized by increasing competition and rapid product adoption by the target market

decline stage

the stage of the IPLC in which products are rapidly losing ground to new technologies or product alternatives, casing a decrease in sales and profits

offshoring

the strategic use of outside resources to perform activities that are usually handled by internal staff and resources

nonmandatory adaptation

the strategy of adapting a product to better meet the needs of the local market, without being required to do so

adaptation

the strategy of altering a product to better meet the needs of a local market

product placement

the strategy of placing brands in movies with the purpose of promoting the products to viewers.

competitive-parity method

the strategy of using competitors' level of advertising spending as a benchmark for the company's own advertising expenditures.

core product strategy

the strategy of using the same standard core product/services worldwide, but varying certain aspects of the offering (product ingredients, advertising) from market to market

receiver

the target market that receives the advertising message from a sender

One of the drawbacks of satellites, which is also their strength, is:

their ability to span a wide geographical region.

The assault on advertising of ________ is escalating, as evidenced by the World Health Organization launching a global campaign against it.

tobacco

produch length

total number of brands in the product mix- all the brands sold by a company

product width

total number of product lines that a company offers to its target international consumers (culinary products, ice cream, detergents, shampoos, cheeses, teas, etc...)

For companies seeking entrance into the complicated Japanese distribution system, ________ offer one of the easiest routes to success because they virtually control distribution through all levels of channels in Japan.

trading companies

In a ________ distribution structure, an importer controls a fixed supply of goods and the marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers.

traditional

_____ is often the approach of choice in markets with insufficient or underdeveloped distribution systems. A. Direct marketing B. A big wholesale store C. Internet selling D. A discount house E. Television advertising

A. Direct marketing Sometimes called direct marketing, selling directly to the consumer through mail, by telephone, or door-to-door is often the approach of choice in markets with insufficient or underdeveloped distribution systems. The approach, of course, also works well in the most affluent markets.

Which of the following has proved to be an important way to break the trade barrier imposed by the Japanese distribution system? A. Direct sales through catalogs B. Large wholesale stores C. Street corner kiosks D. Internet shopping E. Television advertising

A. Direct sales through catalogs Direct sales through catalogs have proved to be a successful way to enter foreign markets. In Japan, it has been an important way to break the trade barrier imposed by the Japanese distribution system.

Which of the following characterizes the business philosophy of the Japanese distribution channels? A. Loyalty B. Direct sales C. Fast delivery D. Variety E. Price competition

A. Loyalty Coupled with the close economic ties and dependency created by trade customs and the long structure of Japanese distribution channels is a relationship-oriented business philosophy that emphasizes loyalty, harmony, and friendship. The value system supports long-term dealer-supplier relationships that are difficult to change as long as each party perceives economic advantage.

_____ take title to manufacturers' goods and assume the trading risks. A. Merchant middlemen B. Brokers C. Buying offices D. Export agent E. Agent middlemen

A. Merchant middlemen Merchant middlemen actually take title to manufacturers' goods and assume the trading risks, so they tend to be less controllable than agent middlemen. Merchant middlemen provide a variety of import and export wholesaling functions involved in purchasing for their own account and selling in other countries.

The Webb-Pomerene Act of 1918 made it possible for American business firms to join forces in export activities without being subject to the _____. A. Sherman Antitrust Act B. Federal Communications Act C. Trade Commission Act D. Food, Drug, and Cosmetics Act E. Robinson-Patman Act

A. Sherman Antitrust Act

Which of the following statements is true regarding an import-oriented distribution structure? A. The importer-wholesaler traditionally performs most of the marketing functions. B. The relationship between the importer and any middleman is similar to that found in a mass-marketing system. C. Several independent agencies providing functions such as advertising, marketing research, financing are part of this distribution structure. D. The idea of a channel as a chain of intermediaries performing specific activities is common. E. This distribution system is national in scope.

A. The importer-wholesaler traditionally performs most of the marketing functions. An import-oriented distribution structure is considered as a traditional distribution structure. The import-oriented distribution systems are local rather than national in scope, and the relationship between the importer and any middleman in the marketplace is considerably different from that found in a mass-marketing system. Since the importer-wholesaler traditionally performs most marketing functions, independent agencies that provide advertising, marketing research, warehousing, and storage are nonexistent or underdeveloped.

Which of the following is the reason why global retailers like IKEA, Costco, Sears Roebuck, and Walmart are becoming major domestic middlemen for international markets? A. They maintain their core marketing approaches while localizing the array of products, promotions, and other peripheral aspects of their operations. B. They work under the names of the manufacturers and function as low-cost, independent marketing departments with direct responsibility to the parent firms. C. They have minimum investment costs as they do not commit to investing in company personnel. D. They serve as the producer's export department but have a short-term relationship, cover only one or two markets, and operate on a straight commission basis. E. They offer reduction of export costs, demand expansion through promotion, trade barrier reduction, and improvement of trade terms through bilateral bargaining.

A. They maintain their core marketing approaches while localizing the array of products, promotions, and other peripheral aspects of their operations. As global retailers like IKEA, Costco, Sears Roebuck, Toys "R" Us, and Walmart expand their global coverage, they are becoming major domestic middlemen for international markets. Their successes seem to result from maintaining their core marketing approaches while localizing the array of products, promotions, and other peripheral aspects of their operations.

Sixty percent of the Japanese population lives in the _____ market area, which essentially functions as one massive city. A. Tokyo-Nagoya-Osaka B. Komaki-Tokoname-Kariya C. Nagoya-Handa-Seto D. Nishio-Okazaki-Inazawa E. Inuyama-Nisshin-Takahama

A. Tokyo-Nagoya-Osaka

A. character Channel captains must be aware that channel patterns change; they cannot assume that once a channel has been developed to fit the character of both company and market, no more need be done. Great Britain, for example, has epitomized distribution through specialty-type middlemen, distributors, wholesalers, and retailers; in fact, all middlemen have traditionally worked within narrow product specialty areas. In recent years, however, there has been a trend toward broader lines, conglomerate merchandising, and mass marketing.

In the context of the use of the Internet in international marketing channels, technically, e-commerce is a form of _____ selling. A. direct B. parallel C. dual D. mass E. targeted

A. direct Technically, e-commerce is a form of direct selling; however, because of its newness and the unique issues associated with this form of distribution, it is important to differentiate it from other types of direct marketing. E-commerce is used to market B2B services, consumer services, and consumer and industrial products via the World Wide Web. It involves the direct marketing from a manufacturer, retailer, service provider, or some other intermediary to a final user.

A major disadvantage of _____ is that they can seldom afford to make the kind of market investment needed to establish deep distribution for products. A. export management companies B. trading companies C. import associations D. global retailers E. complementary marketers

A. export management companies A major disadvantage of export management companies is that they seldom can afford to make the kind of market investment needed to establish deep distribution for products because they must have immediate sales payout to survive.

In the context of the types of domestic middlemen, the WTO in 2003 ruled _____ to be in violation of international trade rules, thus starting a major trade dispute with the European Union. A. foreign sales corporations B. direct marketing partnerships C. trading companies D. export promotion companies E. Webb-Pomerene export associations

A. foreign sales corporations

In the context of controlling middlemen, parallel importing is also known as _____. A. secondary wholesaling B. black marketing C. backwashing D. industrial piracy E. smuggling

A. secondary wholesaling

B. Continuity Channels of distribution often pose longevity problems. Most middlemen have little loyalty to their vendors. They handle brands in good times when the line is making money but quickly reject such products within a season or a year if they fail to produce during that period.

Which of the following is one of the six Cs of distribution channel strategy? A. Communication B. Continuity C. Capacity D. Commission E. Contribution

B. Continuity cost, capital, control, coverage, character, and continuity.

Which of the following modes of distribution affords the most control over the distribution channels but often at a cost that is not practical? A. Complementary marketers B. Direct sales force C. Export associations D. Trading companies E. Export management companies

B. Direct sales force

_____ has long been considered the most effective nontariff barrier to the Japanese market. A. Population in Japan B. Distribution in Japan C. Culture in Japan D. Import and export procedures in Japan E. Intense competition in Japan

B. Distribution in Japan Distribution in Japan has historically been considered the most effective nontariff barrier to the Japanese market. However, the market is becoming more open as many traditional modes of operation are eroding in the face of competition from foreign marketers and as Japanese consumers continue to focus on lower prices.

Which of the following is a type of domestic middleman? A. Sole proprietors B. Export management companies C. Foreign distributors D. Lessors E. Joint ventures

B. Export management companies

Which of the following distribution structures is also known as a traditional distribution structure? A. Export-oriented B. Import-oriented C. Manufacturer-oriented D. Service-oriented E. Customer-oriented

B. Import-oriented An import-oriented distribution structures is also known as a traditional distribution structure.

B. In an import-oriented or traditional distribution structure, an importer controls a fixed supply of goods, and the marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers. In the resulting seller's market, market penetration and mass distribution are not necessary because demand exceeds supply, and in most cases, the customer seeks the supply from a limited number of middlemen.

Which of the following makes Walmart's transactions with suppliers highly efficient and lowers its cost of operations? A. Clean business reputation B. Internal Internet-based system C. Ability to beat competitors D. Outreach programs to placate small retailers E. Ability to influence foreign governments

B. Internal Internet-based system One of Walmart's strengths is its internal Internet-based system, which makes its transactions with suppliers highly efficient and lowers its cost of operations.

B. Parallel importing A company's goods intended for one country are sometimes diverted through distributors to another country, where they compete with existing retail or wholesale organizations. This is known as parallel importing or secondary wholesaling.

Which of the following actions should be taken to begin the search for prospective middlemen? A. Short-listing the middlemen B. Studying the target market C. Evaluating the available financial resources D. Designing the sales force required E. Understanding the mission of the manufacturing firm

B. Studying the target market The search for prospective middlemen should begin with study of the market and determination of criteria for evaluating middlemen servicing that market.

Which of the following statements is true regarding agent middlemen? A. They take title to the merchandise. B. They work on commission and arrange for sales in the foreign country. C. Manufacturers cannot control them as much as they control merchant middlemen. D. They do not represent the best interests of the manufacturer. E. They assume trading risks.

B. They work on commission and arrange for sales in the foreign country. Agent middlemen work on commission and arrange for sales in the foreign country but do not take title to the merchandise.

A disadvantage when using home-country middlemen as intermediaries in the distribution process is the: A. large financial investment required. B. limited control over the distribution process. C. large managerial investments required. D. limited number of retailers in the foreign country who can be reached. E. large amount of commission.

B. limited control over the distribution process. A major trade-off when using home-country middlemen is limited control over the entire process. Domestic middlemen are most likely to be used when the marketer is uncertain or desires to minimize financial and management investment.

A major goal of the Export Trading Company (ETC) Act was to: A. allow U.S. companies to bypass tax laws with respect to international trading. B. remove antitrust disincentives to export activities. C. bypass trade barriers in foreign countries. D. earn the highest possible profits in foreign countries. E. combine export shipments within single containers.

B. remove antitrust disincentives to export activities. The Export Trading Company (ETC) Act allows producers of similar products to form export trading companies. A major goal of the ETC Act was to increase U.S. exports by encouraging more efficient export trade services to producers and suppliers to improve the availability of trade finance and to remove antitrust disincentives to export activities

For companies seeking entrance into the complicated Japanese distribution system, _____ offer one of the easiest routes to success because they virtually control distribution through all levels of channels in Japan. A. trade representatives B. trading companies C. brokers D. export management companies E. complementary marketers

B. trading companies The omnipresent trading companies virtually control distribution through all levels of channels in Japan. Because trading companies may control many of the distributors and maintain broad distribution channels, they provide the best means for intensive coverage of the market.

Which of the following factors affects the choice of distribution channels? A. Distance from manufacturer B. Language spoken in the target market C. Available distribution intermediaries D. Consumer literacy levels E. Country's per capita income

C. Available distribution intermediaries

Which of the following countries has the largest number of retailers? A. United States B. Argentina C. China D. Brazil E. Japan

C. China has the largest number of retailers. Refer to Exhibit 15.2-Retail Structure in Selected Countries.

General Motors, _____, and DaimlerChrysler have created a single online site called Covisint for purchasing automotive parts from suppliers. A. Toyota Motor Corporation B. Honda Motor Company C. Ford Motor Company D. Nissan Motor Company E. Tata Motors

C. Ford Motor Company General Motors, Ford Motor Company, and DaimlerChrysler have created a single online site called Covisint (www.covisint.com) for purchasing automotive parts from suppliers, which is expected to save the companies millions of dollars.

In the context of factors affecting choice of channels, which of the following is one of the key elements in distribution decisions? A. Selection of optimum container sizes B. Volume discounts and rebates C. Functions performed by middlemen D. Local advertising modes E. Target market culture

C. Functions performed by middlemen Distribution channels vary depending on target market size, competition, and available distribution intermediaries. Key elements in distribution decisions include the functions performed by middlemen (and the effectiveness with which each is performed), the cost of their services, their availability, and the extent of control that the manufacturer can exert over middlemen activities.

In Japan, under the Large-Scale Retail Store Law, all proposals for new "large" stores were first judged by the _____. A. Transport and Tourism Department B. Internal Affairs and Business Council C. Ministry of International Trade and Industry D. Health and Welfare Committee E. Local Retailers Union

C. Ministry of International Trade and Industry In Japan, under the Large-Scale Retail Store Law, all proposals for new "large" stores were first judged by the Ministry of International Trade and Industry.

Which of the following statements is true of the Japanese market? A. The costs of Japanese consumer goods are among the lowest in the world. B. Manufacturers are independent of wholesalers for a multitude of services to other members of the distribution network. C. The Japanese distribution structure supports long-term dealer-supplier relationships. D. Japanese law favors the establishment of large retail stores. E. Japanese consumers favor price over personal service.

C. The Japanese distribution structure supports long-term dealer-supplier relationships. Coupled with the close economic ties and dependency created by trade customs and the long structure of Japanese distribution channels is a relationship-oriented business philosophy that emphasizes loyalty, harmony, and friendship. The value system supports long-term dealer-supplier relationships that are difficult to change as long as each party perceives economic advantage.

Which of the following statements is true regarding merchant middlemen? A. They represent the best interests of a manufacturer. B. They can be controlled better than agent middlemen. C. They assume trading risks. D. They work on commission and arrange for sales in the foreign country. E. They do not take title to manufacturers' goods.

C. They assume trading risks.

C. complementary marketing

One of the reasons that channels of distribution often pose longevity problems is that most middlemen _____. A. do not maintain sufficient inventory to serve customers B. lack product knowledge resulting in low sales volume C. have little loyalty to their vendors D. tend to slow down distribution to extract higher commissions E. do not have sufficient knowledge of the target market

C. have little loyalty to their vendors

Complementary marketing is commonly known as _____. A. backhauling B. demand shifting C. piggybacking D. shape shifting E. skimming

C. piggybacking

D. An export management company The EMC functions as a low-cost, independent marketing department with direct responsibility to the parent firm. The export management company may take full or partial responsibility for promotion of the goods, credit arrangements, physical handling, market research, and information on financial, patent, and licensing matters.

Which of the following is one of the highest costs of doing business in China? A. Money required for the transportation of goods B. Money required for obtaining appropriate permits C. Cost of local advertising D. Capital required to maintain effective distribution E. Cost of customizing products for the Chinese market

D. Capital required to maintain effective distribution

In which of the following modes of distribution in the foreign market will a company have to make maximum financial investment? A. Export management companies B. Trading companies C. Export associations D. Direct sales force E. Complementary marketers

D. Direct sales force Maximum investment is usually required when a company establishes its own internal channels, that is, its own sales force. Use of distributors or dealers may lessen the capital investment, but manufacturers often have to provide initial inventories on consignment, loans, floor plans, or other arrangements.

Which of the following is true of the distribution process? A. It does not involve the physical handling and distribution of goods. B. It includes activities related to the promotion of goods and services. C. The ownership title remains with the distributor even on completion of the transaction. D. It includes buying and selling negotiations. E. The behavior of channel members is not affected by the cultural environment.

D. It includes buying and selling negotiations. In every country and in every market, urban or rural, rich or poor, all consumer and industrial products eventually go through a distribution process. The distribution process includes the physical handling and distribution of goods, the passage of ownership (title), and—most important from the standpoint of marketing strategy—the buying and selling negotiations between producers and middlemen and between middlemen and customers.

Who are frequently criticized for not representing the best interests of a manufacturer? A. Global wholesalers B. Trading companies C. Consumers D. Merchant middlemen E. Brokers

D. Merchant middlemen Merchant middlemen actually take title to manufacturers' goods and assume the trading risks, so they tend to be less controllable than agent middlemen. Because merchant middlemen primarily are concerned with sales and profit margins on their merchandise, they are frequently criticized for not representing the best interests of a manufacturer.

_____ is a subject area that should be on the checklist of criteria for evaluating middlemen servicing a market. A. Flexibility B. Hypersensitivity C. Cultural empathy D. Productivity E. Breadth of knowledge

D. Productivity The checklist of criteria differs according to the type of middlemen being used and the nature of their relationship with the company. Basically, such lists are built around four subject areas: productivity or volume, financial strength, managerial stability and capability, and the nature and reputation of the business.

_____ are considered to be the foundation of the Japanese distribution system. A. Consumers B. Brokers C. Manufacturers D. Small retailers E. Wholesalers

D. Small retailers The Japanese system has four distinguishing features: (1) a structure dominated by many small middlemen dealing with many small retailers, (2) channel control by manufacturers, (3) a business philosophy shaped by a unique culture, and (4) laws that protect the foundation of the system—the small retailer.

Home-country middlemen are also known as _____ middlemen. A. area B. local C. merchant D. domestic E. regional

D. domestic

A _____ provides a selling service for a manufacturer, has a short-term relationship, and operates on a straight commission basis. A. manufacturers' retail store B. trading company C. global retailer D. manufacturer's export agent E. complementary marketer

D. manufacturer's export agent

In the context of distribution patterns, the rate of change in retailing around the world appears to be directly related to the _____. A. literacy rate B. rate of inflation C. population growth D. speed of economic development E. currency exchange rate

D. speed of economic development Retailing around the world has been in a state of active ferment for several years and the rate of change appears to be directly related to the stage and speed of economic development, and even the least developed countries are experiencing dramatic changes. Supermarkets of one variety or another are blossoming in developed and underdeveloped countries alike

Which of the following is a critical element associated with using a particular type of middleman? A. Knowledge of the culture of the target market B. Number of employees C. Mode of transportation for moving goods D. Influence over the target market E. Cash-flow patterns

E. Cash-flow patterns Capital requirement and cash-flow patterns are critical elements associated with using a particular type of middleman.

Which of the following arrangements is undertaken when a firm wants to keep its seasonal distribution channels functioning throughout the year? A. Price skimming B. Using the services of a trading company C. Establishing a retail store D. Using the services of an export management company E. Complementary marketing

E. Complementary marketing Most complementary marketing arrangements are undertaken when a firm wants to fill out its product line or keep its seasonal distribution channels functioning throughout the year. Companies may work either on an agency or merchant basis, but the greatest volume of piggyback business is handled on an ownership (merchant) purchase-and-resale arrangement.

Which of the following statements is true regarding an export management company (EMC)? A. It acts as a middleman for firms with relatively large international sales volume. B. It operates under its own name while providing services to another firm. C. It does not have direct responsibility to the parent firm. D. It acts as a middleman for firms willing to involve their own personnel in international functions. E. It calls for minimum investment from the parent firm to get into international markets.

E. It calls for minimum investment from the parent firm to get into international markets. The export management company (EMC) is an important middleman for firms with relatively small international volume or those unwilling to involve their own personnel in the international function. Two of the chief advantages of EMCs are minimum investment on the part of the company to get into international markets, and no commitment of company personnel or major expenditure of managerial effort.

Which of the following is true of a physical distribution system? A. It involves only the physical movement of goods. B. It is a total systems approach to the management of the distribution process. C. It includes decisions involving an activity that has no impact on the cost and efficiency of one or all others. D. It excludes the interdependence of the costs of each activity. E. It includes transportation mode, inventory quantities, and packing.

E. It includes transportation mode, inventory quantities, and packing. A physical distribution system involves more than the physical movement of goods. It includes the location of plants and warehousing (storage), transportation mode, inventory quantities, and packing. The concept of physical distribution takes into account the interdependence of the costs of each activity; a decision involving one activity affects the cost and efficiency of one or all others. In fact, because of their interdependence, the sum of each of the different activity costs entails an infinite number of "total costs."

In the context of cultural reactions when engaging in e-commerce, the color red is associated with socialism in _____. A. the United States B. China C. Brazil D. Uruguay E. Spain

E. Spain The different cultural reactions to color can be a potential problem for websites designed for global markets. While red may be highly regarded in China or associated with love in the United States, in Spain it is associated with socialism.

Which of the following, according to experienced exporters, is the only way to select a middleman? A. Conduct a background check on all the distributors available in the target market B. Issue a request-for-proposal to all distributors in the target market and evaluate their responses C. Consult other manufacturers of similar products and select the distributor recommended by them D. Consult trade organizations and select the distributor recommended by them E. Talk personally to ultimate consumers to find whom they consider to be the best distributors

E. Talk personally to ultimate consumers to find whom they consider to be the best distributors Experienced exporters suggest that the only way to select a middleman is to go personally to the country and talk to ultimate users of your product to find whom they consider to be the best distributors. Visit each possible middleman once before selecting the one to represent you; look for one with a key person who will take the new product to his or her heart and make it a personal objective to make the sale of that line a success.

Which of the following statements is true of a traditional distribution structure? A. The distribution system is national in scope. B. The relationship between the importer and any middleman is similar to that found in a mass-marketing system. C. The idea of a channel as a chain of intermediaries performing specific activities and each selling to a smaller unit beneath it until the chain reaches the ultimate consumer is common. D. Independent agencies providing functions such as advertising, marketing research, and financing are part of this distribution structure. E. The marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers.

E. The marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers. In an import-oriented or traditional distribution structure, an importer controls a fixed supply of goods, and the marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers. In the resulting seller's market, market penetration and mass distribution are not necessary because demand exceeds supply, and in most cases, the customer seeks the supply from a limited number of middlemen.

Which of the following is true of foreign sales corporations? A. They are commonly called piggybackers. B. They can only be related to a manufacturing parent and not an independent broker. C. They virtually control distribution through all levels of channels in Japan. D. They accumulate, transport, and distribute goods from many countries. E. They can function as principal or commissioned agents.

E. They can function as principal or commissioned agents. A foreign sales corporation can function as a principal, buying and selling for its own account, or a commissioned agent. It can be related to a manufacturing parent or can be an independent merchant or broker.

A(n) _____ is a domestic middleman set up in a foreign country or U.S. possession that can obtain a corporate tax exemption on a portion of the earnings generated by the sale or lease of export property. A. Webb-Pomerene export association B. manufacturer's export agent C. export management company D. complementary marketer E. foreign sales corporation

E. foreign sales corporation A foreign sales corporation (FSC) is a sales corporation set up in a foreign country or U.S. possession that can obtain a corporate tax exemption on a portion of the earnings generated by the sale or lease of export property. Manufacturers and export groups can form FSCs. An FSC can function as a principal, buying and selling for its own account, or a commissioned agent.

A(n) _____ is an individual agent middleman or an agent middleman firm providing a selling service for manufacturers that covers only one or two markets. A. manufacturer's retail store B. export management company C. Webb-Pomerene export association D. global retailer E. manufacturer's export agent

E. manufacturer's export agent The manufacturer's export agent (MEA) is an individual agent middleman or an agent middleman firm providing a selling service for manufacturers. Unlike the EMC, the MEA does not serve as the producer's export department but has a short-term relationship, covers only one or two markets, and operates on a straight commission basis.

E-commerce is more developed in _____ than the rest of the world, partly because of the lower cost of access to the Internet than found elsewhere. A. China B. Brazil C. Switzerland D. South Africa E. the United States

E. the United States E-commerce is more developed in the United States than the rest of the world, partly because of the vast number of people who own personal computers and partly because of the much lower cost of access to the Internet than found elsewhere.

A physical distribution system involves only the physical movement of goods.

FALSE A physical distribution system involves more than the physical movement of goods. It includes the location of plants and warehousing (storage), transportation mode, inventory quantities, and packing.

Merchant middlemen tend to be more controllable than agent middlemen because they take title to manufacturers' goods.

FALSE Agent middlemen work on commission and arrange for sales in the foreign country but do not take title to the merchandise. Merchant middlemen actually take title to manufacturers' goods and assume the trading risks, so they tend to be less controllable than agent middlemen.

Contests, sweepstakes, and sponsorship of special events such as concerts are techniques used for maintaining and improving public relations.

FALSE Cents-off, in-store demonstrations, samples, coupons, gifts, product tie-ins, contests, sweepstakes, sponsorship of special events such as concerts, the Olympics, fairs, and point-of-purchase displays are types of sales promotion devices.

Legal advice is not necessary when entering distribution contracts with middlemen.

FALSE Competent legal advice is vital when entering distribution contracts with middlemen. But as many experienced international marketers know, the best rule is to avoid the need to terminate distributors by screening all prospective middlemen carefully.

Domestic middlemen offer many advantages for companies with large international sales volume.

FALSE Domestic middlemen offer many advantages for companies with small international sales volume, those inexperienced with foreign markets, those not wanting to become immediately involved with the complexities of international marketing, and those wanting to sell abroad with minimal financial and management commitment.

For most companies, trade shows and direct selling are the major components in the marketing communications mix.

FALSE For most companies, advertising and personal selling are the major components in the marketing communications mix.

In an import-oriented distribution structure, supply often exceeds demand.

FALSE In an import-oriented or traditional distribution structure, an importer controls a fixed supply of goods, and the marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers. In the resulting seller's market, market penetration and mass distribution are not necessary because demand exceeds supply, and in most cases, the customer seeks the supply from a limited number of middlemen.

In the United States, if a middleman is terminated, the company is required to pay 1 percent of the middleman's average annual compensation multiplied by the number of years the middleman served as a final settlement.

FALSE In the United States, termination is usually a simple action regardless of the type of middlemen; they are simply dismissed. However, in other parts of the world, the middleman often has some legal protection that makes termination difficult.

In a traditional distribution structure, distribution systems are national rather than local in scope.

FALSE In the traditional distribution structure, distribution systems are local rather than national in scope, and the relationship between the importer and any middleman in the marketplace is considerably different from that found in a mass-marketing system. The idea of a channel as a chain of intermediaries performing specific activities and each selling to a smaller unit beneath it until the chain reaches the ultimate consumer is not common in an import-oriented system.

In the context of distribution structures, one of Walmart's strengths is its ability to influence foreign governments.

FALSE One of Walmart's strengths in distribution is its internal Internet-based system, which makes its transactions with suppliers more efficient and lowers its cost of operations.

In the context of the distribution structure in Japan, it has been observed that Japanese consumers favor cheaper prices over personal service.

FALSE The Japanese consumer contributes to the continuation of the traditional nature of the distribution system through frequent buying trips, small purchases, favoring personal service over price, and a proclivity for loyalty to brands perceived to be of high quality. Additionally, Japanese law gives the small retailer enormous advantage over the development of larger stores and competition.

The Japanese distribution structure is similar to the one found in the United States or in Europe.

FALSE The Japanese distribution structure is different enough from its U.S. or European counterparts that it should be carefully studied by anyone contemplating entry. The Japanese system has four distinguishing features: (1) a structure dominated by many small middlemen dealing with many small retailers, (2) channel control by manufacturers, (3) a business philosophy shaped by a unique culture, and (4) laws that protect the foundation of the system—the small retailer.

A distinguishing characteristic of the Japanese distribution channel system is that it is controlled by a few small retailers found in the country.

FALSE The Japanese system has four distinguishing features: (1) a structure dominated by many small middlemen dealing with many small retailers, (2) channel control by manufacturers, (3) a business philosophy shaped by a unique culture, and (4) laws that protect the foundation of the system—the small retailer.

In the context of the different kinds of middlemen, the WTO in 2003 ruled export management companies to be in violation of international trade rules.

FALSE The WTO in 2003 ruled foreign sales corporations to be in violation of international trade rules, thus starting a major trade dispute with the European Union that still simmers and occasionally boils over.

The distribution channel process includes all activities, beginning with the manufacturer and ending with the retailer.

FALSE The distribution channel process includes all activities, beginning with the manufacturer and ending with the final consumer. This inclusion means the seller must exert influence over two sets of channels: one in the home country and one in the foreign-market country.

The distribution process includes promotion of goods and services by sellers and resellers.

FALSE The distribution process includes the physical handling and distribution of goods, the passage of ownership (title), and—most important from the standpoint of marketing strategy—the buying and selling negotiations between producers and middlemen and between middlemen and customers.

An e-vendor in a foreign market can generally ignore culture as an important variable because the commerce is being done via the Internet, which is culturally insensitive.

FALSE The website and the product must be culturally neutral or adapted to fit the uniqueness of a market, because culture does matter.

Export management companies work under their own names

FALSE Typically, the EMC becomes an integral part of the marketing operations of its client companies. The export management companies work under the names of the manufacturers. An export management company functions as a low-cost, independent marketing department with direct responsibility to the parent firm.

Using foreign-country middlemen moves the manufacturer away from the market and the company becomes less involved with problems of language, physical distribution, communications, and financing.

FALSE Using foreign-country middlemen moves the manufacturer closer to the market and involves the company more closely with problems of language, physical distribution, communications, and financing. Foreign middlemen may be agents or merchants, they may be associated with the parent company to varying degrees, or they may be hired temporarily for special purposes

Agent middlemen work on commission and do not take title to the merchandise

TRUE Agent middlemen work on commission and arrange for sales in the foreign country but do not take title to the merchandise. By using agents, the manufacturer assumes trading risk but maintains the right to establish policy guidelines and prices and to require its agents to provide sales records and customer information.

Channels of distribution often pose longevity problems.

TRUE Channels of distribution often pose longevity problems. Most agent middlemen firms tend to be small institutions. When one individual retires or moves out of a line of business, the company may find it has lost its distribution in that area.

TRUE Creating good relationships with the popular press and other media to help companies communicate messages to their publics—customers, the general public, and governmental regulators—is the role of public relations (PR).

Different cultures often seek the same value or benefits from the primary function of a product.

TRUE Different cultures often seek the same value or benefits from the primary function of a product—for example, the ability of an automobile to get from point A to point B, a camera to take a picture, or a wristwatch to tell time.

Trading companies provide the best means for intensive coverage of the market in Japan

TRUE For companies seeking entrance into the complicated Japanese distribution system, the Japanese trading company offers one of the easiest routes to success. Because trading companies may control many of the distributors and maintain broad distribution channels, they provide the best means for intensive coverage of the market.

Ideally, a website should be translated into the languages of the target market.

TRUE Ideally, a website should be translated into the languages of the target markets. This translation may not be financially feasible for some companies, but at least the most important pages of the site should be translated.

In the traditional distribution structure, independent agencies that provide facilitating functions are nonexistent or underdeveloped.

TRUE In a traditional distribution structure, the importer-wholesaler performs most of the marketing functions. Hence, independent agencies that provide advertising, marketing research, warehousing and storage, transportation, financing, and other facilitating functions found in a developed, mature marketing infrastructure are nonexistent or underdeveloped.

Sales promotions constitute the major portion of the promotional effort in rural and less accessible parts of a market.

TRUE In markets in which the consumer is hard to reach because of media limitations, the percentage of the promotional budget allocated to sales promotions may have to be increased. In some less developed countries, sales promotions constitute the major portion of the promotional effort in rural and less accessible parts of the market.

A reason for the failure of marketing communications is that the message received by the intended audience is not understood because of different cultural interpretations.

TRUE International communications may fail for a variety of reasons: A message may not get through because of media inadequacy, the message may be received by the intended audience but not be understood because of different cultural interpretations, or the message may reach the intended audience and be understood but have no effect because the marketer did not correctly assess the needs and wants or even the thinking processes of the target market.

Of all the elements of the marketing mix, decisions involving advertising are those most often affected by cultural differences among country markets.

TRUE Of all the elements of the marketing mix, decisions involving advertising are those most often affected by cultural differences among country markets.

The Export Trading Company Act allows producers of similar products to form export trading companies.

TRUE The Export Trading Company (ETC) Act allows producers of similar products to form export trading companies. A major goal of the ETC Act was to increase U.S. exports by encouraging more efficient export trade services to producers and suppliers to improve the availability of trade finance and to remove antitrust disincentives to export activities.

The behavior of channel members in the distribution process is the result of the interactions between the cultural environment and the marketing process.

TRUE The behavior of channel members is the result of the interactions between the cultural environment and the marketing process. Channel structures range from those with little developed marketing infrastructure, such as those found in many emerging markets, to the highly complex, multilayered system found in Japan.

While developing an international advertisement campaign, the last step of the process is evaluating the campaign relative to the goals specified.

TRUE The steps to be performed for developing an international advertisement campaign are: perform marketing research; specify the goals of the communication; develop the most effective message(s) for the market segments selected; select effective media; compose and secure a budget based on what is required to meet goals; execute the campaign; and evaluate the campaign relative to the goals specified.

As traditional channel structures are changing, importers and retailers are also becoming involved in new product development.

TRUE Traditional channel structures are giving way to new forms, new alliances, and new processes—some more slowly than others, but all are changing. Multinational marketers are seeking ways to profitably tap market segments that currently are served by costly, traditional distribution systems. Direct marketing, door-to-door selling, hypermarkets, discount houses, shopping malls, catalog selling, the Internet, and other distribution methods are being introduced in an attempt to provide efficient distribution channels. Importers and retailers also are becoming more involved in new product development.

Traditional channels in developing countries evolved from economies with a strong dependence on imported manufactured goods.

TRUE Traditional channels in developing countries evolved from economies with a strong dependence on imported manufactured goods. In an import-oriented or traditional distribution structure, an importer controls a fixed supply of goods, and the marketing system develops around the philosophy of selling a limited supply of goods at high prices to a small number of affluent customers.

An export management company functions as a low-cost, independent marketing department with direct responsibility to the parent firm.

TRUE Typically, the export management company (EMC) becomes an integral part of the marketing operations of its client companies. Working under the names of the manufacturers, the EMC functions as a low-cost, independent marketing department with direct responsibility to the parent firm. The working relationship is so close that customers are often unaware they are not dealing directly with the export department of the company.

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