Part 1: MULTIPLE CHOICES. Choose ONE Alternative That Best Completes The Statement

Marketing Management, 15th, Global Edition
Chapters 12, 13, 15, 16, 17, and 19 in the book in addition to extra material provided during the course.
1
Marketing Management, 15th, Global Edition
Part 1: MULTIPLE CHOICES. Choose ONE alternative that best completes the statement.
DON’T REWRITE the statement and/or choice. Just mention the numbers
1) Galaxy chocolate has successfully competed with Cadbury by positioning itself as "your
partner in chocolate indulgence" and featuring smoother product shapes, more refined taste,
and
sleeker packaging, which represents which of the following main strategies for growing the core
of the business?
A) Make the core of the brand as distinctive as possible.
B) Drive distribution through both existing and new channels.
C) Offer the core product in new formats or versions.
D) Increase costs and revenue.
E) Expand to another geographic region.
Answer: A
Diff: 2
LO: 12.1: Why is it important for companies to grow the core of their business?
AACSB: Reflective thinking
2) The market ________ has the largest market share and usually shows the way to other firms
in
price changes, new-product introductions, distribution coverage, and promotional intensity.
A) challenger
B) entrant
C) follower
D) nicher
E) leader
Answer: E
Diff: 1
LO: 12.2: How can market leaders expand the total market and defend market share?
AACSB: Analytical thinking
3) When the total market expands, the market ________ usually gains the most.
A) challenger
B) leader
C) follower
D) nicher
E) entrant
Answer: B
Diff: 2
4) When a firm looks for new users in groups that might use a product but do not already use
the
product, the firm is using the ________ strategy.
A) new-market segment
B) market-penetration
C) geographical-expansion
D) product development
E) diversification
Answer: B
Diff: 1
5) When firms look for new users in groups that have never used the product before, the firm is
using the ________ strategy.
A) new-market segment
B) market-penetration
C) geographical-expansion
D) product development
E) diversification
Answer: A
Diff: 1
6) A ________ is anything that can be offered to a market to satisfy a want or need, including
physical goods, services, experiences, events, persons, places, properties, organizations,
information, and ideas.
A) function
B) product
C) benefit
D) process
E) structure
Answer: B
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
7) When companies search for new ways to satisfy customers and distinguish their offering
from
others, they look at the ________ product, which encompasses all the possible augmentations
and transformations of the product.
A) consumption
B) expected
C) potential
D) augmented
E) basic
Answer: C
Diff: 2
8) What goods are similar in quality but different enough in price to justify shopping
comparisons?
A) emergency goods
B) homogeneous shopping goods
C) heterogeneous shopping goods
D) specialty goods
E) convenience goods
Answer: B
Diff: 2
9) Which of the following is most closely related with the organic growth of an organization?
A) acquiring a product or service brand
B) entering new marketplaces
C) increasing the operational profitability
D) increasing productivity of employees
E) developing new products from within
Answer: E
Diff: 2
LO: 15.1: How can new products be categorized?
10) It has been observed that most new products have shorter product life cycles. What is the
reason for this?
A) Most new products do not use technology.
B) Most new products are not backed by a marketable idea.
C) New products do not get adequate management support.
D) Social and governmental constraints lead to this failure.
E) Rivals quickly copy products that are successful.
Answer: E
Diff: 2
LO: 15.2: What challenges does a company face in developing new products and services?
11) When consumers examine products, they often compare an observed price to an internal
price they remember. This is known as a(n) ________ price.
A) markup
B) reference
C) market-skimming
D) accumulated
E) target
Answer: B
Diff: 1
LO: 16.1: How do consumers process and evaluate prices?
12) Which of the following is NOT one of the possible consumer reference prices?
A) typical price
B) actual future price
C) last price paid
D) expected future price
E) upper-bound price
Answer: B
Diff: 3
13) The minimum price that most consumers would pay for a given product is known as the
________ price.
A) everyday low
B) usual discounted
C) fair
D) typical
E) lower-bound
Answer: E
Diff: 1
14) Pricing cues such as sale signs and prices that end in 9 are more influential when ________.
A) customers have substantial knowledge about prices
B) customers purchase the particular item regularly
C) product quality is standardized
D) product designs vary over time
E) prices do not vary from time to time
Answer: D
Diff: 2
15) A merchant is a(n) ________ in the marketing channel.

A) wholesaler
B) broker
C) sales agent
D) warehouse
E) advertising agency
Answer: A
Diff: 1
LO: 17.1: What is a marketing channel system and value network?
16) When is a pull strategy appropriate?

A) when there is low brand loyalty
B) when consumers are able to perceive differences between brands
C) when brand choice is made in the store
D) when it is a low involvement purchase
E) when the product is an impulse item
Answer: B
Diff: 2
LO: 17.1: What is a marketing channel system and value network?
17) A direct marketing channel is a ________ channel.

A) one-level
B) two-level
C) zero-level
D) three-level
E) reverse-flow
Answer: C
Diff: 2
LO: 17.2: What work do marketing channels perform?
18) Which of the following activities is a reverse-flow channel of marketing?

A) raw materials movement
B) product recycling
C) materials ordering
D) finished goods storage
E) customer order placement
Answer: B
Diff: 2
AACSB: Application of knowledge
19) ________ refers to the means by which firms attempt to inform, persuade, and remind
consumers — directly or indirectly — about the products and brands they sell.
A) Human resource development
B) Marketing communications
C) Financial management
D) Operations management
E) Planning
Answer: B
Diff: 1
LO: 19.1: What is the role of marketing communications?
20) Which of the following elements of the marketing communications mix refers to any paid
form of nonpersonal presentation and promotion of ideas, goods, or services by an identified
sponsor via print, broadcast, network, electronic, and display media?
A) advertising
B) personal selling
C) sales promotion
D) direct marketing
E) public relations
Answer: A
Diff: 1
21) Tracy works for a cellular phone company that offers trade-in allowances toward the
upgrade
of new phones, which is an example of ________.
A) a sales promotion
B) interactive marketing
C) word-of-mouth marketing
D) personal selling
E) events and experiences
Answer: A
Diff: 2
AACSB: Application of knowledge
22) Which of the following is an example of a trade promotion?

A) free samples
B) discount coupons
C) display allowances
D) contests for sales reps
E) premiums
Answer: C
Diff: 1
23) Which of the following marketing communications tools is most effective at the later stages
of the buying process?
A) personal selling
B) public relations
C) advertising
D) sales promotions
E) direct marketing
Answer: A
Diff: 1
LO: 19.2: What is the marketing communications mix?
24) Advertising and publicity tools play the most important roles in influencing buying decisions
at the ________ stage of buyer readiness.
A) comprehension
B) conviction
C) ordering
D) reordering
E) awareness-building
Answer: E
Diff: 1
25) Which of the following circumstances are best suited for personal selling?
A) when the products used are simple and easy-to-use
B) when there is minimal risk involved in buying or using the products
C) when the market has fewer buyers and larger sellers
D) when the products being marketed are inexpensive and easily available
E) when prospective customers are spread across a wide geographic area
Answer: C
Diff: 2
Part2: TRUE/FALSE: Please answer all of the following and justify your answers
If it is TRUE give at least one example, if it FALSE, prove it
1) When the total market expands, the dominant firm usually gains the most.
Answer: TRUE
Diff: 1
2) The market leader should look for new customers or more usage from existing customers.
3) A market-penetration strategy is one where a company searches for new customers in a
group
that has never used a product before.
Answer: TRUE
Diff: 1
4) One way to increase the frequency of consumption of a product by consumers is by

introducing it in larger package sizes.
Answer: FALSE
Diff: 1
5) The most constructive response to protecting market share is continuous innovation.

Answer: TRUE
Diff: 1
6) A responsive marketer looks ahead to needs customers may have in the near future.
Answer: FALSE
Diff: 1
7) Marketing planning begins with formulating an offering to meet target customers' needs or
wants.
Answer: TRUE
Diff: 1
8) A product is anything that can be offered to a market to satisfy a want or need.

Answer: TRUE
Diff: 1
9) The customer-value hierarchy consists of the basic product, core benefit, expected product,
augmented product, and the consumption system.
Answer: FALSE
Diff: 2
10) Durable products normally require less personal selling and service and less seller
guarantees
than nondurable goods.
Answer: FALSE
Diff: 2
11) Organic growth refers to increasing the profitability of the organization by increasing
employee productivity.
Answer: FALSE
Diff: 1
12) Companies typically must create a strong R&D and marketing partnership to pull off a
radical innovation.
Answer: TRUE
Diff: 1
13) Companies should use normal investment criteria to budget for new-product
developments.
Answer: FALSE
Diff: 2
LO: 15.3: What organizational structures and processes do managers use to oversee new-
product
development?
14) Price is one of the two elements of the marketing mix that produces revenue.
Answer: FALSE
Diff: 1
15) Today, consumers are price takers and accept prices at face value or as given.
Answer: FALSE
Diff: 1
16) Customers usually have a lower price threshold below which prices signal inferior or
unacceptable quality, as well as an upper price threshold above which prices are prohibitive
and
the product appears not worth the money.
Answer: TRUE
Diff: 1
17) Pricing cues such as sale signs and prices that end in 9 are more influential when consumers
are experienced in the category.
Answer: FALSE
Diff: 2
18) When examining products, consumers compare an observed price to an internal reference
price they remember or an external frame of reference.
Answer: TRUE
Diff: 1
19) In target-return pricing, the firm adds a standard markup to the product's cost.
Answer: FALSE
Diff: 2
LO: 16.2: How should a company set prices initially for products or services?
20) Value pricing requires a company to reengineer its operations to become a low-cost
producer.
Answer: TRUE
Diff: 1
21) Generally, consumers prefer small price increases on a regular basis to sudden, sharp
increases.
Answer: TRUE
Diff: 1
LO: 16.4: When and how should a company initiate a price change?
22) Marketing communications allow companies to link their brands to other people, places,
events, brands, experiences, feelings, and things.
Answer: TRUE
Diff: 1
23) The pervasive nature of advanced communications technologies, such as the Internet, has
resulted in greater exposure of customers to advertising content than it was in the 1960s.
Answer: FALSE
Diff: 2
24) Marketing communications in almost every medium and form have been on the rise, and
some consumers feel they are increasingly invasive.
Answer: TRUE
Diff: 1
25) In this new communication environment, advertising is often the single most important
element of a marketing communications program for sales and building brand and customer
equity.
Answer: FALSE
Diff: 1
Part 3: DISCUTION QUESTIONS: Answer ALL of the following questions
(10 Marek)
1) What is counteroffensive defense? Explain with an example.

Answer: Student answers will vary. In a counteroffensive, the market leader can meet the
attacker frontally and hit its flank, or launch a pincer movement so it will have to pull back
to defend itself. After FedEx watched UPS successfully invade its airborne delivery system, it
invested heavily in ground delivery through a series of acquisitions to challenge UPS on its
home turf. Another common form of counteroffensive is the exercise of economic or
political clout. The leader may try to crush a competitor by subsidizing lower prices for the
vulnerable product with revenue from its more profitable products, or it may prematurely
announce a product upgrade to prevent customers from buying the competitor's product.
Or the leader may lobby legislators to take political action to inhibit the competition.
Diff: 2
2) Your marketing manager has asked you to develop a new customer strategy for your
company. Additionally, you have been asked to develop, specifically, a market-penetration
strategy to assist in gaining new customers. Describe a market-penetration strategy in this
context.
Answer: The market-penetration strategy in this context would seek to get new customers from
a group that might use the product but as yet do not.
Diff: 1
AACSB: Analytical thinking; Application of knowledge
3) Assume that your firm is a market leader in manufacturing detergent. How would the firm
use
position defense as a defensive marketing strategy to maintain its share?
Answer: Position defense means occupying the most desirable market space in consumers'
minds, making the brand almost impregnable. Tide, as a popular laundry detergent, has
become synonymous with washing machine detergent. Student answers may vary.
Diff: 2
4) Explain briefly using a diagram the product life-cycle concept, and explain the dynamics of
each stage and how a company should design its strategy through the different stages of the
product life-cycle.
5) The market nicher is a specialist. Characterize the end-user specialist role that can be
assumed
by the market nicher.
Answer: When the firm assumes the end-user specialist role, it specializes in one type of end-
use customer. For example, a value-added reseller (VAR) customizes computer hardware and
software for specific customer segments and earns a price premium in the process.
Diff: 2
LO: 12.4: How can market followers or nichers compete effectively?
6) You know that marketers have traditionally classified products based on characteristics of
durability, tangibility, and use. You also know that each product type has an appropriate
marketing-mix strategy attached. In analyzing your company's products, you decide to list each
of these products and the appropriate marketing-mix strategy to understand where your
products
"fit." List these products and their appropriate marketing-mix strategies.
Answer:
• Nondurable goods — the appropriate strategy is to make them available in many locations,
charge only a small markup, and advertise heavily to induce trial and build preference.
• Durable goods — tangible goods that normally survive many uses. Durable products normally
require more personal selling and service, command a higher margin, and require more seller
guarantees.
• Services — intangible, inseparable, variable, and perishable products. They require more
quality control, supplier credibility, and adaptability.
Diff: 2
7) Industrial goods can be classified in terms of how they enter the production process and
their
relative costliness. Identify the three groups of industrial goods.
Answer: The three groups of industrial goods include:
Materials and parts are goods that enter the manufacturer's product completely. Raw materials
(farm and natural products) and manufactured materials and parts (component materials and
component parts) compose this group.
8) Product-mix pricing can involve a number of pricing strategies for the brand manager. List
each of these strategies and briefly define each.
Answer: There are six situations involving product-mix pricing:

1. product-line pricing — low-, medium-, and high-priced products within the same line, such as
different priced ties
2. optional-feature pricing — charging for "extra" features, such as leather seats in a car
3. captive-product pricing — when the "user" has no choice but to use the high-priced
"disposable" products that make the entire product work (for example, ink cartridges for
printers)
4. two-part pricing — consisting of a fixed fee and a variable usage fee (cell phone usage)
5. by-product pricing — the price of the by-products of goods being used for other purposes (oil
refining for example)
6. product-bundling pricing — pure bundling when the firm offers its products only as a bundle,
or mixed bundling when the firm offers its products as a "bundle" and/or individually
Diff: 2
LO: 13.6: How can a company build and manage its product mix and product lines?
9) You have been asked to prepare a product-line analysis for your company's stable of
products.
Why is it important for product-line mangers to do a product-line analysis?
Answer: Product-line managers need to know the sales and profits of each item in their line in
order to determine which items to build, maintain, harvest, or divest. They also need to
understand each product line's market profile.
Diff: 1
LO: 13.6: How can a company build and manage its product mix and product lines?
10) What are the types of new products that a firm can introduce? What are the problems
associated with introducing a truly innovative product? What are the necessary conditions to
create a radically innovative product?
Answer: New products range from new-to-the-world products that create an entirely new
market
to minor improvements or revisions of existing products. Most new-product activity is devoted
to improving existing products. Truly innovative and new-to-the-world products incur the
greatest cost and risk. Although radical innovations can hurt the company's bottom line in the
short run, if they succeed they can create a greater sustainable competitive advantage than
ordinary products
and produce significant financial rewards as a result. Companies typically must create a strong
R&D and marketing partnership to pull off a radical innovation. The right corporate culture is
another crucial determinant; the firm must prepare to cannibalize existing products, tolerate
risk,and maintain a future market orientation. Few reliable techniques exist for estimating
demand for radical innovations.
Diff: 2
LO: 15.1: How can new products be categorized?
11) How do companies organize new product development?

Answer: Companies handle the organizational aspect of new-product development in several
ways. Many assign responsibility to product managers. Some employ new-product managers
who report to category managers. A few companies have growth leaders, a full-time job for its
most creative and successful managers. Some companies have a high-level management
committee charged with reviewing and approving proposals. Large companies often establish a
new-product department headed by a manager with substantial authority and access to top
management whose responsibilities include generating and screening new ideas, working with
the R&D department, and carrying out field testing and commercialization.
Diff: 2
LO: 15.3: What organizational structures and processes do managers use to oversee new-
product
development?
AACSB: Interpersonal relations and teamwork
12) What are the different price-setting methods? Briefly describe each of them.
Answer: The six major price-setting methods are:

1. Markup pricing — This is the most elementary pricing method wherein a standard markup is
added to the product's cost.
2. Target-return pricing — Here, the firm determines the price that yields its target rate of
return on investment.
3. Perceived-value pricing — Perceived value is made up of a host of inputs, such as the buyer's
image of the product performance, the channel deliverables, the warranty quality, customer
support, and softer attributes such as the supplier's reputation, trustworthiness, and esteem.
Companies must deliver the value promised by their value proposition, and the customer must
perceive this value.
4. Value pricing — Companies win loyal customers by charging a fairly low price for a high-
quality offering. Value price is just not a matter of lowering the prices but also it is a matter of
reengineering the company's operations to become a low-cost producer without sacrificing
quality, to attract a large number of value conscious customers.
5. Going-rate pricing — Here, the firm bases its price largely on competitors' prices.
6. Auction-type pricing — There are three major types of auctions and their separate pricing
procedures:
a. English auctions — These have one seller and many buyers. The highest bidder gets the item.
b. Dutch auctions — This features one seller and many buyers, or one buyer and many sellers.
In the first kind, an auctioneer announces a high price for a product and then slowly decreases
the price until a bidder accepts. In the other, the buyer announces something he wants to buy,
and potential sellers compete to offer the lowest price.
c. Sealed-bid auction — This lets would-be suppliers submit only one bid. The suppliers have no
knowledge about the other bids.
Diff: 2
13) A company that pays its bills each month for its rent, heat, interest, and salaries regardless
of
its output is said to be incurring what type of costs?
Answer: These are said to be a company's fixed costs.

Diff: 2
14) What are the different types of price discounts and allowances?
Answer: The different types of price discounts and allowances are:

• Discount — This is a price reduction given to buyers who pay their bills promptly.
• Quantity discount — This is a price reduction offered to those who buy in large volumes.
• Functional discount — This is offered by a manufacturer to trade-channel members if they
perform certain functions like selling, storing, and recordkeeping.
• Seasonal discount — This is a price reduction given to those who buy merchandise or services
out of season.
• Allowance — This is an extra payment designed to gain reseller participation in special
programs. There are of two types:
• Trade-in allowances — These are granted for turning in an old item when buying a new one.
• Promotional allowances — These reward dealers for participating in advertising and sales
support programs.
Diff: 2
LO: 16.3: How should a company adapt prices to meet varying circumstances and
opportunities?
15) Briefly explain the various levels of marketing channels.
Answer: A zero-level channel, also called a direct marketing channel, consists of a manufacturer
selling directly to the final customer. The major examples are door-to-door sales, home parties,
mail order, telemarketing, TV selling, Internet selling, and manufacturer-owned stores.
A one-level channel contains one selling intermediary, such as a retailer. A two-level channel
contains two intermediaries. In consumer markets, these are typically a wholesaler and a
retailer.
A three-level channel contains three intermediaries. In the meatpacking industry, wholesalers
sell to jobbers, essentially small-scale wholesalers, who sell to small retailers.
Diff: 2
16) Members of a marketing channel perform three types of functions. Provide examples of
these
three functions in the context of a publishing company that publishes books and magazines.
Answer: The storage and movement of books from the company to the customer constitutes a
forward flow. Ordering books and paying for them constitute a backward flow from customers
to the company. Sharing information and risk taking are activities that occur in both directions.
Diff: 2
17) What is the role of advertising as a communications tool in marketing for business markets?
Answer: Although marketers rely more on sales calls in business markets, advertising still plays
a significant role:
• Advertising can provide an introduction to the company and its products.
• If the product has new features, advertising can explain them.
• Reminder advertising is more economical than sales calls.
• Advertisements offering brochures and carrying the company's phone number or Web
address are an effective way to generate leads for sales representatives.
• Sales representatives can use copies of the company's ads to legitimize their company and
products.
• Advertising can remind customers how to use the product and reassure them about their
purchase.
Diff: 2
18) What are the characteristics of an ideal ad campaign?
Answer: In an ideal ad campaign, the right consumer is exposed to the right message at the
right place and at the right time. The consumer is not distracted from the intended message.
The ad properly reflects the consumer's level of understanding of and behaviors with the
product and the brand. The ad correctly positions the brand in terms of desirable and
deliverable points-of-difference and points-of-parity. The ad motivates consumers to consider
purchase of the brand.
Diff: 2
LO: 19.3: How do marketing communications work?
19) How do the stages in a product's life cycle influence the marketing communications mix?
Answer: In the introduction stage of the product life cycle, advertising, events and experiences,
and publicity have the highest cost-effectiveness, followed by personal selling to gain
distribution coverage and sales promotion and direct marketing to induce trial. In the growth
stage, demand has its own momentum through word of mouth and interactive marketing.
Advertising, events and experiences, and personal selling all become more important in the
maturity stage. In the decline stage, sales promotion continues strong, other communication
tools are reduced, and salespeople give the product only minimal attention.
Diff: 2
20) Briefly describe the macromodel of the marketing communications and the micromodel,
illustrating your answer using a relevant diagram.

Part 1: MULTIPLE CHOICES. Choose ONE Alternative That Best Completes The Statement

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Part 1: MULTIPLE CHOICES. Choose ONE Alternative That Best Completes The Statement

Uploaded by

Copyright:

Available Formats

Marketing Management, 15th, Global Edition

15) A merchant is a(n) ________ in the marketing channel.

16) When is a pull strategy appropriate?

17) A direct marketing channel is a ________ channel.

18) Which of the following activities is a reverse-flow channel of marketing?

22) Which of the following is an example of a trade promotion?

4) One way to increase the frequency of consumption of a product by consumers is by

5) The most constructive response to protecting market share is continuous innovation.

8) A product is anything that can be offered to a market to satisfy a want or need.

1) What is counteroffensive defense? Explain with an example.

Answer: There are six situations involving product-mix pricing:

11) How do companies organize new product development?

Answer: The six major price-setting methods are:

Answer: These are said to be a company's fixed costs.

Answer: The different types of price discounts and allowances are:

15) Briefly explain the various levels of marketing channels.

18) What are the characteristics of an ideal ad campaign?

You might also like