Chapter 12 Marketing Channels: Delivering Customer Value

88) Which of the following should be a manufacturer's first step when designing an
effective marketing channel? A) set channel objectives B) analyze consumer needs C) identify
channel alternatives D) evaluate channel alternatives E) establish strategic alliances Answer:
B Skill: Concept Objective: LO 12.3: Identify the major channel alternatives open to a
company. Difficulty: Moderate

89) Which of the following is NOT a step in designing an effective marketing channel? A)
evaluating the channel alternatives B) identifying major channel alternatives C) analyzing
consumer needs D) determining pricing policy for channel members E) setting channel
objectives Answer: D AACSB: Analytical thinking Skill: Concept Objective: LO 12.3:
Identify the major channel alternatives open to a company. Difficulty: Moderate

90) In designing the marketing channel, a company must balance customer needs and wants
with ____. A) the need to make a profit B) the requirement to find channel members to fill all
the steps C) the firm's position in the customers' minds D) the desire to be "the
best" in all service areas E) the firm's resources and skills to provide all the desired
services Answer: E AACSB: Analytical thinking Skill: Concept Objective: LO 12.3: Identify
the major channel alternatives open to a company. Difficulty: Challenging

91) The company's channel objectives are influenced by all of the following EXCEPT
____. A) the company's marketing intermediaries B) the company's competitors
C) the age of the company D) the nature of the company E) the company's products
Answer: C AACSB: Analytical thinking Skill: Concept Objective: LO 12.3: Identify the
major channel alternatives open to a company. Difficulty: Moderate

95) Whitelight sells its toothpastes in many convenience stores across the country. This is an
example of ____ distribution. A) exclusive B) selective C) hybrid D) intensive E) normal
Answer: D AACSB: Analytical thinking Skill: Application Objective: LO 12.3: Identify the
major channel alternatives open to a company. Difficulty: Moderate

96) With which of the following strategies would a company give only a limited number of
dealers the right to distribute its products in their territories? A) exclusive distribution B)
extensive distribution C) moderate distribution D) primary distribution E) intensive
distribution Answer: A AACSB: Analytical thinking Skill: Concept Objective: LO 12.3:
Identify the major channel alternatives open to a company. Difficulty: Easy

97) For which product would a company use an exclusive distribution strategy? A) luxury cars
B) newspapers C) chewing gum D) dairy products E) soft drinks Answer: A AACSB:
Analytical thinking Skill: Application Objective: LO 12.3: Identify the major channel
alternatives open to a company. Difficulty: Moderate

98) Ocean Spray sells its air fresheners only through Ray's Drugs. This is an example
of ____ distribution. A) exclusive B) selective C) intensive D) indirect E) corporate Answer:
A AACSB: Application of knowledge Skill: Application Objective: LO 12.3: Identify the
major channel alternatives open to a company. Difficulty: Easy

99) ____ distribution involves the use of more than one but fewer than all of the
intermediaries who are willing to carry a company's products. A) Exclusive B)
Selective C) Intensive D) Indirect E) Corporate Answer: B AACSB: Analytical thinking Skill:
Concept Objective: LO 12.3: Identify the major channel alternatives open to a company.
Difficulty: Easy

100) Craftsman Furniture Company offers its bedroom and living room furniture through
independent and smaller chain furniture stores, not through every store that sells furniture. It
uses ____ distribution. A) intensive B) direct C) corporate D) selective E) exclusive Answer:
D AACSB: Analytical thinking Skill: Concept Objective: LO 12.3: Identify the major channel
alternatives open to a company. Difficulty: Easy

104) Which of the following is NOT a criterion a company will use to evaluate the major
channel alternatives? A) adaptability B) control C) commitment D) sales and costs E)
likability Answer: E AACSB: Analytical thinking Skill: Application Objective: LO 12.3:
Identify the major channel alternatives open to a company. Difficulty: Moderate

105) Why do firms have difficulty accessing potential market areas in developing countries,
such as China and India? A) inadequate distribution systems B) anti-globalization efforts C)
highly centralized rural markets D) limited manpower E) high operating costs Answer: A
AACSB: Application of knowledge Skill: Concept Objective: LO 12.3: Identify the major
channel alternatives open to a company. Difficulty: Easy

106) Multichannel marketing occurs when a single firm sets up two or more marketing
channels to reach one or more customer segments. Answer: TRUE Skill: Concept Objective:
LO 12.3: Identify the major channel alternatives open to a company. Difficulty: Easy

107) Marketing channel design calls for analyzing consumer needs, setting channel objectives,
identifying major channel alternatives, and evaluating those alternatives. Answer: TRUE
Skill: Concept Objective: LO 12.3: Identify the major channel alternatives open to a company.
Difficulty: Easy

108) Producers of convenience products and common raw materials typically seek exclusive
distribution, a strategy in which they stock their products in as many outlets as possible.
Answer: FALSE AACSB: Analytical thinking Skill: Concept Objective: LO 12.3: Identify the
major channel alternatives open to a company. Difficulty: Easy

109) Under the strategy of intensive distribution, the producer gives only a limited number of
dealers the exclusive right to distribute its products in their territories. Answer: FALSE Skill:
Concept Objective: LO 12.3: Identify the major channel alternatives open to a company.
Difficulty: Easy

110) The producer informs each channel member what its responsibilities are, and what the
terms of business are. Answer: FALSE Skill: Concept Objective: LO 12.3: Identify the major
channel alternatives open to a company. Difficulty: Easy

111) Describe the types of products that are intensively distributed and provide examples.
Answer: Convenience products and common raw materials must be available where and when
consumers want them; examples include chewing gum, soft drinks, and toothpaste. Student
examples will vary. AACSB: Application of knowledge Skill: Concept Objective: LO 12.3:
Identify the major channel alternatives open to a company. Difficulty: Easy
112) Describe the types of products that are exclusively distributed and provide examples.
Answer: Exclusive distribution is often used for luxury brands, such as expensive automobiles
and prestige clothing. Student answers will vary. AACSB: Application of knowledge Skill:
Concept Objective: LO 12.3: Identify the major channel alternatives open to a company.
Difficulty: Easy

113) Describe the types of products that are selectively distributed and provide examples.
Answer: In selective distribution, more than one, but fewer than all, of the intermediaries who
are willing to carry a company's products are used. Products include appliances and
some branded clothing. Student answers will vary. AACSB: Application of knowledge Skill:
Concept Objective: LO 12.3: Identify the major channel alternatives open to a company.
Difficulty: Easy