Marketing 6th Edition Grewal Test Bank

Marketing 6th Edition Grewal Test Bank
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Chapter 07
Test Bank
1. Business-to-business marketing refers to buying and selling goods or services to consumers.
FALSE
AACSB: Analytical Thinking

Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 07-01 Describe the ways in which business-to-business (B2B) firms segment their markets.
Topic: Buyer-seller Relationships
Feedback: Business-to-business marketing refers to the process of buying and selling goods or services to be used in the production of other goods and
services for consumption by the buying organization and/or resale by wholesalers and retailers.
2. B2B marketing involves manufacturers, wholesalers, and service firms.

TRUE

Blooms: Remember
Difficulty: 1 Easy
Feedback: B2B organizations market goods and services to other businesses but not to the ultimate consumer.
3. Resellers differ from producers in that resellers significantly alter the form of goods they sell.
FALSE

Blooms: Understand
Difficulty: 2 Medium
Feedback: Resellers are marketing intermediaries that resell manufactured products without significantly altering their form. Wholesalers, distributors,
and retailers are all resellers.
4. The B2B buying process tends to be more formal than B2C buying.
TRUE

Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 07-02 List the steps in the B2B buying process.
Topic: B2B Buying Process
Feedback: The B2B buying process is more structured than the B2C process, involving written specification of needs and formal proposals.
5. The RFP process is used by buyers to allow customer input into value creation.
FALSE

Blooms: Understand
Feedback: The request for proposals (RFP) is a common process through which organizations invite alternative vendors or suppliers to bid on supplying
their required components or specifications.
6. The final step of the business-to-business buying process is a formal vendor performance analysis.
TRUE

Blooms: Remember
7-1
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
Difficulty: 1 Easy
Feedback: In this final step, the selected vendor's performance is evaluated in order to decide whether or not to give the vendor additional business in the
future.
7. Organizational culture may vary by geography.

TRUE

Blooms: Understand
Learning Objective: 07-04 Describe the different types of organizational cultures.
Topic: Buying Center
Feedback: Organizational culture may vary by geography, by division, or by functional department.
8. Most B2B buying situations can be categorized into three categories: new buys, structured rebuys, and automatic rebuys.
FALSE

Blooms: Remember
Difficulty: 1 Easy
Learning Objective: 07-05 Detail different buying situations.
Feedback: Most B2B buying situations are categorized as either new buys, modified rebuys, or straight rebuys.
9. In both new buy and straight rebuy situations, several members of a buying center will be intensely involved in the purchasing decision.
FALSE

Blooms: Understand
Topic: Buying Situations
Feedback: In a new buy, all members of the buying center will be involved in the purchasing decision; however, in a straight rebuy, it is likely that the
buyer will handle the transaction alone.
10. An architect working for a large firm requests specific computer software to produce designs, drawings, and other technical information for his
clients. The architect probably serves as a gatekeeper in the buying center.
FALSE
AACSB: Knowledge Application

Blooms: Apply
Difficulty: 3 Hard
Learning Objective: 07-03 Identify the roles within the buying center.
Feedback: The architect will fill the user role. The user is the person who consumes or uses the product or service. In addition, the architect is probably
the initiator. The gatekeeper controls information or access, or both, to decision makers and influencers.
11. A buying center whose members reach a decision based on a collective agreement is known as an autocratic buying center.
FALSE

Blooms: Understand
Feedback: In an autocratic buying center, even though there may be multiple participants, one person makes the decision alone. A consensus buying
center is one in which all members of the team must reach a collective agreement that they can support a particular decision.
12. A small business decides to upgrade its aging phone system. The business will probably place a straight rebuy order.
FALSE
7-2
Blooms: Apply
Difficulty: 3 Hard
Feedback: Straight rebuys occur when the buyer or buying organization simply buys additional units of products that had previously been purchased.
Many B2B purchases are likely to fall in the straight rebuy category. In this case, a new buy is the most likely choice.
13. When the Toyota Prius first entered the marketplace, dealers kept waiting lists of people wanting one and the factories had to ramp up production
and order more raw materials. This is an example of derived demand.
TRUE

Blooms: Apply
Difficulty: 3 Hard
Topic: Allocating Resources
Feedback: Derived demand reflects the link between consumers' demand for a company's output and the company's purchase of necessary inputs to
manufacture or assemble that particular output.
14. Fabricworld buys fabric from China and sells it to clothing manufacturers in the United States. Fabricworld is a retailer.
FALSE

Blooms: Apply
Difficulty: 3 Hard
Feedback: Fabricworld is a reseller. A retailer sells directly to a consumer.
15. Public institutions do not engage in B2B relationships.

FALSE

Blooms: Remember
Difficulty: 1 Easy
Feedback: Public institutions engage in B2B relationships to fulfill their needs for capital construction, equipment, supplies, food, and janitorial
services.
16. Formal performance evaluations of the vendor and the products sold generally occur in the B2C buying process.
FALSE

Blooms: Remember
Difficulty: 1 Easy
Feedback: Formal performance evaluations of the vendor and the products sold generally do not occur in B2C buying situations as they do in the B2B
setting.
17. The local school district realized it needed to upgrade the computers in the school libraries. This represents the product specification stage of the
B2B buying process.
FALSE

Blooms: Apply
Difficulty: 3 Hard
7-3
Feedback: In the first stage of the B2B buying process, the buying organization recognizes, through either internal or external sources, that it has an
unfilled need—in this case, upgraded computers for the school libraries.
18. A small business may use a web portal as a means of forming a supply chain that can respond to its needs.
TRUE
AACSB: Technology
Blooms: Remember
Difficulty: 1 Easy
Feedback: Smaller companies may lack the ability to attract broad attention to their requests, so they might turn to a web portal. Portals can provide
tremendous cost savings because they eliminate periodic negotiations and routine paperwork, and they offer the means to form a supply chain that can
respond quickly to the buyer's needs.
19. Once a vendor receives an order from a firm, it responds by immediately filling the order.
FALSE

Blooms: Remember
Difficulty: 1 Easy
Feedback: The supplier first sends an acknowledgment that it has received the order, and then it fills the order.
20. As the owner of a small business with 60 employees that makes custom floor mats, Paul makes all of the buying decisions. Paul is most likely the
user.
FALSE

Blooms: Apply
Difficulty: 3 Hard
Feedback: Paul is the influencer, decider, buyer, and gatekeeper, but probably not the user.
21. When you go to the hospital for an operation, you are the decider in the buying process.
FALSE

Blooms: Apply
Difficulty: 3 Hard
Feedback: You are the user. The decider would be the person who chose the supplies for your surgery.
22. Consultative buying centers use one person to make a decision but solicit input from others before doing so.
TRUE

Blooms: Remember
Difficulty: 1 Easy
Feedback: This is the definition of consultative buying centers.
23. LinkedIn is useful for networking in the B2B marketplace, but Twitter is not typically used.
FALSE
AACSB: Technology
Blooms: Remember
Difficulty: 1 Easy
7-4
Feedback: The LinkedIn.com social network is mainly used for professional networking in the B2B marketplace. Twitter, the microblogging site, is
also valuable for B2B marketers because they can communicate with other businesses as often as they want.
24. As Daphne's business grew, she needed to find a new way to manage payroll for her employees, so she researched payroll companies to see which
one would best meet her needs. Daphne was involved in a new buy situation.
TRUE

Blooms: Apply
Difficulty: 3 Hard
Feedback: In a new buy situation, a customer purchases a good or service for the first time.
25. Neighbors Bicycles needed more bicycle seats. It decided to order gel seats in addition to the traditional seats it had always ordered. This is a straight
rebuy.
FALSE

Blooms: Apply
Difficulty: 3 Hard
Feedback: This is a modified rebuy. In a modified rebuy, the buyer has purchased a similar product in the past but has decided to change some
specifications such as the desired price, quality level, customer service level, options, and so forth. It could also be considered a new buy because
Neighbors hadn't ordered gel seats before.
Multiple Choice Questions
26. Business-to-business marketing involves buying and selling goods or services by all of the following except
A. manufacturers.
B. consumers.
C. retailers.
D. producers.
E. wholesalers.

Blooms: Remember
Difficulty: 1 Easy
Feedback: Business-to-business (B2B) marketing refers to the process of buying and selling goods or services to be used in the production of other
goods and services for consumption by the buying organization and/or resale by wholesalers and retailers. When businesses sell to consumers, it is B2C
marketing.
27. Derek bought a pickup truck to transport his equipment to fishing tournaments. He also bought a trailer for his lawn maintenance business. His
purchases were
A. both B2C purchases since he is the user in both situations.
B. both B2B purchases since he is the user in both situations.
C. neither B2C nor B2B since he is the consumer and his uses might be mixed.
D. B2C and B2B, respectively.
E. B2B and B2C, respectively.

Blooms: Apply
Difficulty: 3 Hard
Feedback: The truck Derek purchased for fishing tournaments is for his personal use and was a business-to-consumer purchase. The trailer he bought
for his business was a B2B purchase.
7-5
28. Jackie works as a sales rep for a company that produces and sells steel used in building construction. Jackie is in __________ sales.
A. G2B
B. B2C
C. B2B
D. C2C
E. G2G

Blooms: Apply
Difficulty: 3 Hard
Feedback: Jackie sells materials used by other businesses; thus, she is in B2B sales.
29. Sales of electric components manufactured by Rick's company depend on sales of new cars. Rick's company faces __________ demand.
A. synthetic
B. situational
C. monopolistic
D. contrived
E. derived

Blooms: Apply
Difficulty: 3 Hard
Feedback: Derived demand refers to the link between consumers' demand for a company's output and the company's purchase of necessary inputs. The
car manufacturer's demand for electric components is derived from the demand for its cars.
30. Paula has developed a successful business selling appliances to homebuilders. She carefully monitors the issuance of new home permits to
anticipate how many appliances she will need to buy in order to supply her customers. Paula is concerned with __________ demand.
A. modified
B. secondary
C. rebuy
D. derived
E. delayed

Blooms: Apply
Difficulty: 3 Hard
Feedback: Derived demand refers to the link between consumers' demand for a company's output and the company's purchase of necessary inputs. The
homebuilders' demand for appliances is derived from the demand for its homes.
31. Whether targeting consumers or resellers, marketers need to focus on

A. creating value for their customers.
B. buying center synergy.
C. private exchange efficiency.
D. corporate profit sharing.
E. reducing derived demand.

Blooms: Remember
Difficulty: 1 Easy
Topic: Product Value Creation
Feedback: Value creation is a key consideration for both B2C and B2B marketing.
32. Unlike manufacturers, __________ buy products from other businesses but do not significantly alter the form of the products they buy before selling
them.
A. producers
7-6
B. consumers
C. resellers
D. raw materials suppliers
E. gatekeepers

Blooms: Remember
Difficulty: 1 Easy
Feedback: Resellers—both wholesalers and distributors—buy products from businesses and sell to other businesses, but do not significantly alter the
products involved.
33. A __________ is a type of reseller, a business that buys from other businesses but does not significantly alter the form of the products it buys.
A. manufacturer
B. producer
C. consumer
D. wholesaler
E. factory

Blooms: Remember
Difficulty: 1 Easy
Feedback: Resellers include wholesalers, distributors, and retailers.
34. Malcolm buys overrun clothing from factories around the South. He sells the clothes to discount retailers. Malcolm is a
A. manufacturer.
B. producer.
C. consumer.
D. factory agent.
E. reseller.

Blooms: Apply
Difficulty: 1 Easy
Feedback: Resellers include wholesalers, distributors, and retailers. Resellers purchase products from businesses and sell them to other businesses
without significantly altering them.
35. Hospitals, schools, and religious organizations are examples of __________ buyers.
A. manufacturing
B. retail
C. institutional
D. factory agent
E. reseller

Blooms: Remember
Difficulty: 1 Easy
Feedback: Institutional buyers include organizations such as hospitals, colleges, and churches.
36. Which of the following is an example of an institutional buyer?

A. Mayo Clinic Hospital
B. Procter & Gamble
C. U.S. Marine Corps
D. Nucor Steel Corporation
E. Walmart
7-7
Blooms: Understand
Feedback: Institutional buyers include organizations such as hospitals, colleges, and churches.
37. Which of the following is an example of a government buyer?

A. Mayo Clinic Hospital
B. Procter & Gamble
C. the Pentagon
D. Nucor Steel Corporation
E. Walmart

Blooms: Understand
Feedback: Government buyers include national and local government organizations, as well as government agencies.
38. In most countries, __________ is(are) among the largest purchasers of goods and services.
A. the largest retailer
B. the central government
C. construction firms
D. the intelligence agency
E. hospitals

Blooms: Understand
Feedback: In most countries, the central government is one of the largest purchasers of goods and services. For example, the U.S. federal government
spends nearly $4 trillion annually on procuring goods and services.
39. Both the B2B and B2C buying processes begin with
A. central planning.
B. need recognition.
C. postpurchase dissonance.
D. alternative evaluation.
E. order specification.

Blooms: Remember
Difficulty: 1 Easy
Feedback: Need recognition is the first step of both the B2C and B2B buying processes.
40. Compared to the B2C process, the information search and alternative evaluation steps in the B2B process are
A. decentralized.
B. less focused on customer value creation.
C. identical.
D. more formal and structured.
E. based on derived supply analysis.

Blooms: Remember
Difficulty: 1 Easy
7-8
Feedback: Because of the buying center and organizational requirements, the B2B buying process is more formal and tends to have more structure and
rules than the B2C buying process.
41. Typically, B2B buyers ask potential suppliers to

A. write the RFP for the buyer.
B. submit formal proposals.
C. sponsor interviews with final customers in order to determine product needs.
D. always be involved in reselling.
E. organize themselves into selling cooperatives.

Blooms: Remember
Difficulty: 1 Easy
Feedback: B2B buyers often write RFPs and provide them to potential suppliers, requesting formal proposals in response. Occasionally a supplier will
contribute significantly to the writing of an RFP; however, this is not as frequent an occurrence as the submission of proposals.
42. B2B buying decisions are often made by

A. governors.
B. influencers.
C. committees.
D. resellers.
E. consumers.

Blooms: Understand
Feedback: In most large organizations, several people are responsible for buying decisions. These buying center participants can range from employees
who have a formal role in purchasing decisions (i.e., the purchasing or procurement department) to members of the design team who will specify the
equipment or raw materials needed for employees who will be using a new machine that is on order.
43. When Goodwish Marketing decided to upgrade its computer network, many people were involved in the decision. In B2B buying systems, decisions
are often made
A. quickly.
B. by a single expert.
C. at auction sites.
D. by a committee after considerable deliberation.
E. through community debating organizations.

Blooms: Understand
Feedback: In most large organizations, several people are responsible for buying decisions. These buying center participants can range from employees
who have a formal role in purchasing decisions (i.e., the purchasing or procurement department) to members of the design team who will specify the
equipment or raw materials needed for employees who will be using a new machine that is on order.
44. Judy knows it is important to approach business buyers at the right time, often during the first stage of their buying process, which is
A. need recognition.
B. the RFP process.
C. proposal analysis.
D. vendor negotiation and selection.
E. product specification.

Blooms: Understand
7-9
Feedback: Both the B2B and the B2C buying processes begin with need recognition.
45. After need recognition, a business develops __________ that suppliers might use to develop their proposals.
A. derived demand
B. initiator instructions
C. determinant attributes
D. product specifications
E. focal alternatives

Blooms: Understand
Feedback: Product specifications are detailed descriptions of the business's specific requirements for the purchase occasion.
46. After Hurricane Katrina, many states reevaluated their coastal area building requirements. These new building codes represented __________ that
building materials companies used to develop new products.
A. derived demand
B. initiator instructions
C. determinant products
D. product specifications
E. focal alternatives

Blooms: Apply
Difficulty: 3 Hard
Feedback: The new building codes present detailed information that all builders and their suppliers need to adhere to. As such, they will form part of the
specifications for any purchase of building supplies.
47. Charlie is hoping to get a chance to bid on supplying key components to Ned's business. He is eager to move forward, but he must wait until
A. Ned completes vendor negotiations.
B. Ned develops a list of product specifications.
C. Ned's buying center has an opening.
D. Ned agrees to move Charlie's firm from the evoked set to the retrieval set.
E. Ned completes the order specification process.

Blooms: Apply
Difficulty: 3 Hard
Feedback: Until Ned develops his product specifications—a detailed list of the attributes and features he needs—Charlie will not know what to bid.
48. After need recognition and product specification, many firms using the B2B buying process
A. identify contract specifications.
B. issue a request for proposals from invited suppliers.
C. proceed to proposal analysis.
D. enter vendor negotiation and selection.
E. revise their need recognition analysis.

Blooms: Remember
Difficulty: 1 Easy
Feedback: The third step, after need recognition and product specification, is for the firm to provide a request for proposals from suppliers detailing
what the firm needs to purchase.
49. During the RFP stage, B2B buyers

A. recognize obstacles that the firm must work around.
7-10
B. revise their need recognition analysis.
C. invite suppliers to bid on supplying what is requested.
D. proceed to vendor analysis.
E. negotiate contract terms.

Blooms: Remember
Difficulty: 1 Easy
Feedback: In the RFP stage, suppliers are invited to submit proposals in response to the RFP.
50. The process through which organizations invite alternative vendors or suppliers to bid on supplying their required components or specifications is
formally referred to as
A. specification review.
B. contract development.
C. a bidding initiative.
D. request for proposals.
E. invitation to review.

Blooms: Remember
Difficulty: 1 Easy
Feedback: After a firm develops its product specifications, it will invite alternative vendor or suppliers to bid on supplying the required components.
This process is formally known as requests for proposals.
51. After posting an RFP for telecommunications equipment, USF Corporation received six proposals from qualified vendors. Next, USF will
A. recognize obstacles that must be circumvented.
B. reevaluate the firm's needs.
C. give one vendor a purchase order.
D. conduct vendor analysis.
E. evaluate the proposals and narrow the choice to a few suppliers.

Blooms: Understand
Feedback: After the firm has received proposals, it must evaluate the proposals. Often, proposals not meeting all needs are excluded and a small number
of potential suppliers receive final consideration.
52. The buying center for USF Corporation is in the process of discussing price, quality, and delivery schedules with potential suppliers. They are in the
__________ stage of the business-to-business buying process.
A. vendor negotiation
B. product specification
C. need recognition
D. vendor performance assessment
E. RFP

Blooms: Apply
Difficulty: 3 Hard
Feedback: Once the list of potential suppliers has been limited to a few finalists who are able to meet USF's needs, the firm will probably negotiate with
each of the finalists regarding price, quality, delivery, and financing, in order to get the best deal possible.
53. An Internet site whose purpose is to be a major starting point for users when they connect to the web and is often used by smaller companies in the
RFP process is referred to as a(n)
A. podcast.
B. Internet channel.
7-11
C. web portal.
D. buying center.
E. search engine.
AACSB: Technology
Blooms: Remember
Difficulty: 1 Easy
Feedback: Smaller companies may lack the ability to attract broad attention to their requests, so they might turn to a web portal, an Internet site whose
purpose is to be a major starting point for users when they connect to the web. Although there are general portals such as Yahoo! or MSN, B2B partners
connect to specialized or niche portals to participate in online information exchanges and transactions.
54. Frieda has just received a major order from Northrop Corporation for her firm's hydraulic lift equipment. After reviewing the order information,
Frieda will
A. send an acknowledgment that the order has been received.
B. rewrite her firm's proposal.
C. submit a competitive bid.
D. proceed to vendor analysis.
E. evaluate performance.

Blooms: Understand
Feedback: The acknowledgment confirms receipt of the order and the terms specified (price, quantity, delivery schedule, and so on).
55. The final stage in the business-to-business buying process is to

A. place the order.
B. select the vendor.
C. assess vendor performance.
D. address additional needs.
E. prepare an RFP.

Blooms: Understand
Feedback: As the final stage in the business-to-business buying process, vendor analysis evaluates a selected supplier's performance in delivering on the
current order, helping the firm decide whether or not to continue to do business with the supplier.
56. As purchasing manager for Avalon Electronics, Carrie is required to submit a vendor performance analysis every three months. To meet this
requirement, Carrie will most likely
A. interview vendors and seek their feedback.
B. specify and weight performance factors and score the vendors.
C. develop an RFP for vendor analysis.
D. recruit new suppliers.
E. use a modified rebuy vendor form.

Blooms: Apply
Difficulty: 3 Hard
Feedback: Vendor analysis evaluates a selected supplier's performance in delivering on the current order, helping the firm decide whether or not to
continue to do business with the supplier. Various performance metrics are calculated, along with weights for these metrics matching the buyer's
priorities.
57. In most large organizations, several people are responsible for making a purchase decision. This group is called the
A. supply chain.
B. reselling team.
7-12
C. decider group.
D. buying center.
E. expediters.

Blooms: Understand
Feedback: The buying center is a group that works together to make a purchase decision.
58. When you purchase a book on Amazon, you generally have two choices: Buy it directly from Amazon, or purchase it through Amazon but from a
third-party vendor. If you go the direct route, Amazon has already purchased the book from a publisher and is holding it in an Amazon fulfillment
center—a _______ transaction. If you take the third-party route, Amazon acts as an agent for the supplier and takes a commission of about 10 percent of
the value of the merchandise for the right to sell it on Amazon’s platform—a ______ transaction.
A. B2B; B2B
B. B2C; B2C
C. B2C; B2B
D. derived; B2C
E. B2B; derived

Blooms: Understand
Feedback: When you purchase a book on Amazon, you generally have two choices: Buy it directly from Amazon, or purchase it through Amazon but
from a third-party vendor. If you go the direct route, Amazon has already purchased the book from a publisher and is holding it in an Amazon
fulfillment center—a B2B transaction. If you take the third-party route, Amazon acts as an agent for the supplier and takes a commission of about 10
percent of the value of the merchandise for the right to sell it on Amazon’s platform—another B2B transaction.
59. Melanie is the director of human resources for a small manufacturing firm. She has a strong personal interest in technology, and is known
throughout the firm as the one with the most knowledge about new kinds of communications technologies. If the firm decides to upgrade its network,
Melanie will probably function in what role in the firm's buying center?
A. leader
B. initiator
C. influencer
D. decider
E. gatekeeper

Blooms: Apply
Difficulty: 3 Hard
Feedback: Due to her expertise, Melanie's opinion and advice will probably be sought, making her an influencer. The influencer is the person whose
views influence other members of the buying center in making the final decision.
60. Raycom Construction needs heavy-duty equipment to install a new pipeline in northern Alaska. Raycom's engineers have been asked to provide
detailed specifications and recommendations for the equipment needed. The Raycom engineers will primarily play the __________ role in the
company's buying center.
A. buyer
B. initiator
C. influencer
D. user
E. gatekeeper

Blooms: Apply
Difficulty: 3 Hard
Feedback: Due to their technical expertise, the Raycom engineers will influence the purchase decision with their specifications and recommendations.
7-13
61. At many universities, education faculty members were among the first to ask for personal computers. These faculty members were __________ in
the buying center.
A. buyers
B. initiators
C. influencers
D. deciders
E. gatekeepers

Blooms: Understand
Feedback: By requesting computers, the faculty initiated the purchase situation.
62. Raycom Construction needs heavy-duty equipment to install a new pipeline in northern Alaska. After a vendor is chosen, Reginald will handle the
paperwork and send out the purchase order. Reginald plays the role of __________ in the buying center.
A. buyer
B. initiator
C. influencer
D. user
E. gatekeeper

Blooms: Apply
Difficulty: 3 Hard
Feedback: The buyer is the member of the buying center who handles the actual paperwork. In some firms, a full-time purchasing agent does this.
63. Kim is the sales representative for a major textbook publisher. When she calls on the business faculty at General University, her first stop is to chat
with Frank, the business department secretary. From Frank, Kim learns which professors have left the university or have newly arrived. Frank also helps
Kim make appointments to see professors to discuss textbook choices. Frank acts as the __________ in the business department buying center.
A. buyer
B. initiator
C. influencer
D. user
E. gatekeeper

Blooms: Apply
Difficulty: 3 Hard
Feedback: The gatekeeper is the person who controls information or access, or both, to decision makers and influencers.
64. Kim is the sales representative for a major textbook publisher. When she calls on the business faculty at General University, she also tries to meet
with several students to get their feedback on textbooks. She passes this feedback to her managers to guide the development of the publisher's future
textbooks. The students are the __________ in the buying center.
A. deciders
B. initiators
C. influencers
D. users
E. gatekeepers

Blooms: Understand
Feedback: The students are users of the selected textbooks. If their feedback was used by the faculty to choose books, they would also be influencers,
but in this case their feedback is being used by the publisher, not by the faculty members who make the decision.
7-14
65. Many health insurance policies require patients to call and get preapproval for tests or procedures. The health insurance company acts as a(n)
__________ for the purchase of these medical services.
A. decider
B. initiator
C. influencer
D. user
E. gatekeeper

Blooms: Understand
Feedback: The gatekeeper controls information or access, or both, to decision makers and influencers. Since the insurance company controls access to
tests and procedures, it is a gatekeeper in health-related decisions.
66. Unlike a firm's mission statement or employee handbook, a firm's organizational culture often
A. lists specific job tasks for employees.
B. is of no importance to purchase decisions.
C. exists as a set of unspoken guidelines.
D. is ignored by the vast majority of employees.
E. determines the order specification process.

Blooms: Understand
Feedback: A firm’s organizational culture reflects the set of values, traditions, and customs that guide its employees’ behavior. The firm’s culture often
comprises a set of unspoken guidelines that employees share with one another through various work situations.
67. A firm's organizational culture reflects

A. B2C dynamics.
B. an RFP process.
C. a buying center philosophy.
D. a set of values, traditions, and customs.
E. a derived set of influences.

Blooms: Understand
Feedback: A firm’s organizational culture reflects the set of values, traditions, and customs that guide its employees’ behavior.
68. While no one in the firm has discussed it, Brad notices everyone else seems to dress more casually on Fridays during the summer. Brad is observing
part of his firm's
A. organizational culture.
B. governing principles.
C. human resource policy.
D. employee obligations.
E. code of ethics.

Blooms: Apply
Difficulty: 3 Hard
Feedback: The organization's culture is a set of values, traditions, and customs that are typically unwritten. "Casual Friday" dress is an example of such
a custom.
69. While training for her new job as a pharmaceutical sales representative, Mallory spent several days shadowing an experienced company rep. She
7-15
watched the rep focusing on the benefits of the new drugs while not volunteering pricing information, side effects, or comparison data. Mallory assumed
that this reflected part of the pharmaceutical firm's
A. buying center.
B. culture.
C. mission statement.
D. corporate social responsibility.
E. RFP process.

Blooms: Apply
Difficulty: 3 Hard
Feedback: The organization's culture is a set of values, traditions, and customs that are typically unwritten. Unfortunately, Mallory is observing a lack of
regard for ethics that might be characteristic of this one sales rep, or might be an aspect of the company's culture. (Note that this is an issue of ethics, not
corporate social responsibility.)
70. All of the following are general types of organizational cultures except
A. autocratic.
B. democratic.
C. consultative.
D. capitalist.
E. consensus.

Blooms: Remember
Difficulty: 1 Easy
Feedback: The four types of organizational cultures are autocratic, democratic, consultative, and consensus.
71. The customer whom Carlotta is calling on today has a(n) __________ buying center culture. This means that the decision process will involve
reaching agreement among all members of the buying center.
A. consensus
B. autocratic
C. consultative
D. republican
E. democratic

Blooms: Understand
Feedback: In a consensus buying center, all members of the team must reach a collective agreement that they can support a particular purchase.
72. Markham Publishing is known for its consultative buying center culture. Recognizing this corporate culture, someone attempting to sell to Markham
Publishing should
A. treat all members of the buying center as equally important.
B. address the concerns of all members of the buying center with particular attention to the decision maker.
C. focus on providing information to and making the sales approach to the one decision maker.
D. attempt to facilitate the collective agreement of all members of the buying center.
E. focus attention on the gatekeeper in the buying center's team.

Blooms: Apply
Difficulty: 3 Hard
Feedback: A consultative buying center culture is one in which the opinions of all members are sought by the decider, but he or she makes the final
decision.
73. Fordham Hardware is known for its consensus buying center culture. Recognizing this corporate culture, someone attempting to sell to Fordham
7-16
Hardware should
A. focus exclusively on the head of the buying center.
B. address the concerns of all members of the buying center with particular attention to the decision maker.
C. focus on providing information to and making the sales approach to the one decision maker.
D. attempt to facilitate the collective agreement of all members of the buying center.
E. attempt to get one "friend" on the committee to support his products.

Blooms: Apply
Difficulty: 3 Hard
Feedback: A consensus buying center culture is one where the members work together until they reach an agreement.
74. At the main campus of a large university, faculty always refer to one another as "Dr.," wear suits, and guard their academic domains against one
another. This leads to frequent name-calling and strenuous debates. Meanwhile, at the various branch campuses, faculty members call one another by
their first names, dress casually, and support one another's scholarly efforts. This example illustrates the differences in __________ that can exist within
an organization.
A. supply chain communication
B. autocratic buying center culture
C. organizational culture
D. business missions
E. corporate social responsibility

Blooms: Apply
Difficulty: 3 Hard
Feedback: The two campuses reflect widely different organizational cultures—one is formal and competitive, whereas the other is casual and
encourages cooperation.
75. Not knowing the roles of key players in the buying process could cause a sales representative to
A. bid too high a quantity.
B. fail the vendor analysis.
C. respond to an RFP too quickly.
D. waste time and alienate people.
E. misdirect his or her product.

Blooms: Understand
Feedback: A failure to understand the roles and culture of the buying center can cause a sales representative to waste time by focusing too much on the
wrong people. The representative might also alienate people by not paying enough attention to key players in the decision.
76. When Leanne gave her presentation to the BigDeal buying center team, she focused on answering Beverly's questions, since she is the decision
maker. What type of buying center does BigDeal employ?
A. democratic
B. consultative
C. consensus
D. autocratic
E. authoritative

Blooms: Apply
Difficulty: 3 Hard
Feedback: In an autocratic buying center, though there may be multiple participants, one person makes the decision alone—in this case, Beverly, who is
the decision maker.
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77. Jenny was buying the company’s first digital copier, and she involved all of the company's department heads in the decision. Jenny spent weeks
evaluating options, inviting RFPs, and negotiating with vendors before she finally made a purchase decision. This buying situation would most likely be
classified as a
A. new buy.
B. modified rebuy.
C. straight rebuy.
D. modified buy.

Blooms: Apply
Difficulty: 3 Hard
Feedback: Since this was a first time purchase and involved all of the stages of the buying process, this would be a new buy situation.
78. Most B2B buying situations can be categorized as new buys, modified rebuys, and
A. generic buys.
B. straight rebuys.
C. ordinary rebuys.
D. adapted buys.
E. minor buys.

Blooms: Remember
Difficulty: 1 Easy
Feedback: The three kinds of B2B buying situations are new buys, modified rebuys, and straight rebuys.
79. The RFP stage of the B2B buying process is not required for
A. a new buy.
B. a modified rebuy.
C. a straight rebuy.
D. either a new buy or a modified rebuy.
E. an adapted buy.

Blooms: Understand
Feedback: A new buy or a modified rebuy may require an RFP; however, straight rebuys do not require one since they are simple repurchases of
previously purchased products.
80. The buying decision is likely to be most complex and take longest to complete in a(n) __________ B2B buying situation.
A. new buy
B. modified rebuy
C. straight rebuy
D. adapted buy
E. generic buy

Blooms: Remember
Difficulty: 1 Easy
Feedback: The most complex and difficult is the new buy because it requires the buying organization to make changes in its current practices and
purchases. As a result, several members of the buying center will likely become involved, and the level of their involvement will be more intense than
in the case of modified and straight rebuys.
81. In which buying situation is the buyer most likely to proceed through all six steps in the buying process?
A. new buy
B. modified rebuy
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C. straight rebuy
D. generic buy
E. adapted buy

Blooms: Remember
Difficulty: 1 Easy
Feedback: The most complex and difficult is the new buy because it requires the buying organization to make changes in its current practices and
purchases. As a result, several members of the buying center will likely become involved, and the level of their involvement will be more intense than
in the case of modified and straight rebuys. For this reason, the firm is likely to go through all six steps of the process.
82. Manitoba University is buying a distance learning system. Previously, the school had no distance learning technology. For Manitoba University this
represents a(n) __________ situation.
A. adapted buy
B. modified rebuy
C. straight rebuy
D. new buy
E. generic buy

Blooms: Apply
Difficulty: 3 Hard
Feedback: Since Manitoba has no experience buying distance learning systems and no existing vendor relationships, this is a new buy situation.
83. Olga is the sales rep for ATV Communication Systems. She wants to bid on the RFP issued by Manitoba University for distance learning
technology. She knows she will need to provide considerable information and demonstrations of her firm's technology because Manitoba University is
in a new buy situation and does not have
A. the money to afford it.
B. any experience with the product it wishes to purchase.
C. anyone interested in the technology.
D. any derived demand for the system.
E. any students who might be interested in distance learning.

Blooms: Apply
Difficulty: 3 Hard
Feedback: Since Manitoba has no experience buying distance learning systems and no existing vendor relationships, this is a new buy situation.
84. When Natasha took over as facilities manager for Burlington Furniture Manufacturing, she was shocked to see the factory was still heated with a
coal-fired boiler. She made an immediate decision to upgrade the heating system to something more efficient, and began to research available options.
For Natasha and Burlington Furniture, this represented a(n) __________ situation.
A. adapted buy
B. modified rebuy
C. straight rebuy
D. generic buy
E. new buy

Blooms: Apply
Difficulty: 3 Hard
Feedback: Natasha and Burlington Furniture lack experience with updated heating systems, so this will be a new buy situation.
85. In a(n) __________ situation, the buyer has purchased a similar product in the past but has decided to change some specifications.
A. new buy
B. modified rebuy
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C. straight rebuy
D. adapted buy
E. generic buy

Blooms: Remember
Difficulty: 1 Easy
Feedback: In a modified rebuy, the buyer has purchased a similar product in the past but has decided to change some specifications such as the desired
price, quality level, customer service level, options, and so forth.
86. When a business buyer decides to change specifications such as quality or options associated with products purchased in the past, the buyer is
engaged in a(n) __________ situation.
A. new buy
B. modified rebuy
C. straight rebuy
D. adapted buy
E. side-by-side

Blooms: Understand
87. When Walmart considers reordering items for its stores, its buyers are instructed to negotiate price concessions, quality improvements, and/or added
options. In this situation, Walmart buyers are engaged in a(n) __________ situation.
A. new buy
B. modified rebuy
C. straight rebuy
D. adapted buy
E. generic buy

Blooms: Apply
Difficulty: 3 Hard
88. In a modified rebuy situation, __________ are likely to have an advantage in getting the order.
A. consumers
B. resellers
C. current vendors
D. gatekeepers
E. new vendors

Blooms: Understand
Feedback: A modified rebuy situation is one in which the buyer has purchased similar products in the past, but now wants to modify some
specifications. Thus, current vendors may have an advantage since they have an existing relationship with the buyer, as long as they are able to adapt to
the changed specifications.
89. When Val sees the RFP issued by one of his customers, he is concerned that the company has changed its specifications since it placed a previous
order with him. His company's products do not meet the new specifications. In this situation, being the current vendor
A. will necessitate renegotiating price and delivery terms.
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B. allows for a straight rebuy.
C. offsets a consensus buying center culture.
D. will probably not be an advantage in getting the new order.
E. will allow Val to get the order even though his products do not meet the specifications.

Blooms: Apply
Difficulty: 3 Hard
Feedback: Since Val cannot meet the new specifications, his existing relationship with the buyer will not offer him any advantage.
90. A(n) __________ occurs when the purchasing agent orders additional units of products that have previously been purchased.
A. new buy
B. modified rebuy
C. straight rebuy
D. adapted buy
E. generic buy

Blooms: Remember
Difficulty: 1 Easy
Feedback: A straight rebuy occurs when the company is buying more of a product it has bought in the past.
91. If a B2B customer is satisfied with an existing supplier, it will probably engage in a(n) __________ to purchase additional quantities of the item.
A. new buy
B. modified rebuy
C. adapted buy
D. straight rebuy
E. generic buy

Blooms: Remember
Difficulty: 1 Easy
Feedback: A straight rebuy occurs when the company is buying more of a product it has bought in the past.
92. Yvonne uses her customer relationship management (CRM) system to predict when her business customers will need more of her company's
packaging materials. When she thinks a customer should be ready to make another order, she contacts them. Yvonne is using CRM to encourage
customers to engage in a(n)
A. new buy.
B. modified rebuy.
C. adapted buy.
D. straight rebuy.
E. generic buy.

Blooms: Apply
Difficulty: 3 Hard
Feedback: A straight rebuy occurs when the company is buying more of a product it has bought in the past. This is what Yvonne is trying to encourage.
93. Phil put down the phone and told Alice, "I just love that customer. I got another big order, and they just keep on coming." Phil is most likely selling to
a firm in what kind of buying situation?
A. new buy
B. modified rebuy
C. straight rebuy
D. generic buy
E. adapted buy
7-21
Blooms: Apply
Difficulty: 3 Hard
Feedback: A straight rebuy occurs when the company is buying more of a product it has bought in the past. It sounds like Phil's customer places straight
rebuy orders frequently.
94. When a business customer engages in a straight rebuy, the member of the buying center most likely to be involved in the purchase is the
A. decider.
B. initiator.
C. influencer.
D. user.
E. buyer.

Blooms: Understand
Feedback: A straight rebuy occurs when the company is buying more of a product it has bought in the past. For this reason, only the buyer (who handles
the paperwork) usually needs to be involved.
95. In established businesses, a large proportion of B2B purchases fall into the __________ category.
A. straight rebuy
B. new buy
C. adapted buy
D. modified rebuy
E. generic buy

Blooms: Understand
Feedback: A straight rebuy occurs when the company is buying more of a product it has bought in the past. Businesses typically repurchase many
products they have purchased in the past—supplies, raw materials, and parts, for example.
96. The three types of buying situations

A. create confusion among B2B sellers.
B. suggest that B2B sellers should develop one marketing mix to use for all situations.
C. require business sellers to be consistent in their marketing mixes.
D. are theoretical and have little relation to what happens in the real world.
E. call for different marketing and selling strategies.

Blooms: Understand
Feedback: These varied types of buying situations call for very different marketing and selling strategies.
97. The __________ situation usually involves more members of a buying center and involves more time to complete than the other buying situations.
A. modified rebuy
B. new buy
C. adapted buy
D. straight rebuy
E. generic buy

Blooms: Understand
7-22
Feedback: The new buy decision is generally the most complex since the organization does not have experience with purchasing the product, nor any
existing vendor relationships. For this reason, the process often takes longer and involves a larger buying center.
98. A(n) __________ situation in B2B marketing is similar to limited problem solving in the B2C process.
A. adapted buy
B. new buy
C. modified rebuy
D. straight rebuy
E. generic buy

Blooms: Understand
Feedback: Limited problem solving in the B2C process has elements in common with a modified rebuy situation in the B2B process. Both involve a
limited search for information and evaluation of alternatives—not to the same degree as a new buy (or extended problem solving), but also not the
straightforward, simple process of a straight rebuy (or habitual decision making).
99. For B2B salespeople, usually the easiest sale is a(n) __________ situation.
A. adapted buy
B. new buy
C. modified rebuy
D. straight rebuy
E. generic buy

Blooms: Understand
Feedback: A straight rebuy is the easiest sale since the buyer is purchasing an additional quantity of a product they have bought in the past, with little or
no change to the specifications under which past orders were placed.
100. The office policy and procedure states that any purchase requests that are $3,000 and over must be given to Mary Reynolds, who will obtain
authorization from the chief financial officer. Mary serves as a(n) __________ in the buying center.
A. gatekeeper
B. decider
C. buyer
D. user
E. initiator

Blooms: Apply
Difficulty: 3 Hard
Feedback: The gatekeeper is the person who controls information or access, or both, to decision makers and influencers.
101. The president of the Northwoods University student body made a formal request to the IT department for additional computers in the main
computer lab. The student body president is the __________ in the buying center.
A. initiator
B. gatekeeper
C. decider
D. buyer
E. gateway

Blooms: Apply
Difficulty: 3 Hard
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Feedback: The initiator is the first to suggest buying a particular product or service.
102. The Northwoods University IT department is planning to buy additional computers for the computer lab. Pedro Bechara, manager of the lab, is
asked for a recommendation, and he suggests buying Macintosh computers instead of Windows PCs. What role does Pedro play in the buying center?
A. gatekeeper
B. influencer
C. decider
D. buyer
E. initiator

Blooms: Apply
Difficulty: 3 Hard
Feedback: An influencer is a person whose views influence other members of the buying center in making the final decision.
103. Bob Roberts founded Robertico, an equipment leasing company, three decades ago. Although he is now in his seventies, he still has a "hands on"
management style. His employees have learned that there isn't much point in making purchase recommendations for new equipment, because Bob is
going to choose whatever he thinks is best regardless of their views. Robertico has a(n) __________ buying center culture.
A. autocratic
B. democratic
C. consultative
D. consensus
E. bureaucratic

Blooms: Understand
Feedback: An autocratic buying center may have multiple participants, but one person makes the decision alone.
104. A buying center that makes its decisions by majority vote is a(n) __________ buying center.
A. autocratic
B. democratic
C. consultative
D. consensus
E. bureaucratic

Blooms: Understand
Feedback: A democratic buying center is one where the majority opinion is used to make the purchase decision.
105. The local skydiving team is buying new parachutes. The team's coach has invited all team members to make recommendations, after which he will
select the successful vendor. The skydiving team's buying center has a(n) __________ organizational culture.
A. democratic
B. consultative
C. consensus
D. autocratic
E. bureaucratic

Blooms: Understand
Difficulty: 3 Hard
Feedback: A consultative buying center is one in which a single person makes the decision, but first gets opinions from others.
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106. To maximize efficiency, farmers send their eggs to a __________ who handles sales and shipments to supermarkets.
A. distributor
B. fabricator
C. contractor
D. trafficker
E. manufacturer

Blooms: Apply
Feedback: A distributor buys products from manufacturers or producers, and then sells the products to retailers.
107. The chair of the board of the local Humane Society chose the bank where the organization keeps its money; however, the office manager is the
primary person who makes deposits, writes checks, and balances the account every month. The office manager is the __________ in the buying center
for the bank account.
A. initiator
B. decider
C. gatekeeper
D. user
E. influencer

Blooms: Apply
Difficulty: 3 Hard
Feedback: The user is the person who consumes or uses the product or service.
108. B2B partners often connect to each other on the Internet through special __________ designed to facilitate information exchanges and
transactions.
A. search engines
B. web masters
C. web portals
D. web routes
E. gatekeepers
AACSB: Technology
Blooms: Understand
Feedback: A web portal is an Internet site whose purpose is to be a major starting point for users when they connect to the web. Specialized portals exist
to facilitate B2B exchanges.
109. A wholesaler is an example of a

A. reseller.
B. merchandiser.
C. reference group.
D. manufacturer.
E. retailer.

Blooms: Understand
Feedback: Wholesalers, distributors, and retailers are all resellers.
110. What type of B2B organization is a retail store such as T.J.Maxx?

A. Internet
7-25
B. institution
C. government
D. manufacturer
E. reseller

Blooms: Understand
Feedback: Wholesalers, distributors, and retailers are all resellers.
111. Which of the following details is(are) included in the order specification stage of the B2B buying process?
A. prices and delivery dates
B. vendor performance assessment
C. the RFP
D. bids for supplying the required components or parts
E. reasons for choosing a selected vendor

Blooms: Remember
Difficulty: 1 Easy
Feedback: In the order specification stage, the buyer places an order that includes a detailed description of the goods, prices, delivery dates, and in some
cases, penalties for noncompliance.
112. Firms typically repurchase office supplies (paper, ink cartridges, pens, etc.) through straight rebuys on their supplier's website. Should an office
supplies sales rep stay in close touch with his or her current customers? Why or why not?
A. No; this is a waste of time since straight rebuys are straightforward and easy to handle.
B. No; the sales rep should be looking for new customers instead.
C. Yes; straight rebuys require a lot of the sales rep's assistance.
D. Yes; the sales rep might learn about a new opportunity in the need recognition stage.
E. Yes; history has shown that online reordering can't be trusted.

Blooms: Evaluate
Difficulty: 3 Hard
Feedback: While the sales rep probably doesn't need to be involved in the details of straight rebuy orders, there are other reasons to stay involved. In
particular, the sales rep might learn of new opportunities just recognized by the firm and get an opportunity to win new business.
113. Suppose that Volkswagen is preparing an RFP for a hands-free phone connection for a new car model. All of the following would be included in
the RFP except
A. a description of the required features for the device.
B. a time frame when the devices are needed.
C. specifications for connecting the device to the car.
D. a vendor analysis.
E. instructions for preparing proposals.

Blooms: Apply
Difficulty: 3 Hard
Feedback: Vendor analysis takes place after the vendor has been selected and has delivered products; it is part of the final stage of the B2B buying
process.
114. Because they do so much driving while visiting doctors' offices and hospitals, pharmaceutical sales representatives are often given company cars to
drive. When a pharmaceutical company like Merck is preparing to purchase new company cars, sales reps' feedback will be sought on car models and
features, but the final decision will be made by higher levels of management. What role(s) do the sales reps play in the buying center?
A. users
7-26
B. initiators
C. influencers
D. users and influencers
E. users and initiators

Blooms: Apply
Difficulty: 3 Hard
Feedback: The sales reps offer feedback—which makes them influencers—and are also the people who will drive the cars—which makes them users.
115. Kimberly has just learned that Caribou Coffee is looking for a new source of commercial-grade coffee makers, one of the products she sells. She
knows Caribou has been in business for many years, but she has not been able to get any business from them. When developing her marketing strategy,
Kimberly will probably assume that this represents a(n) __________ situation for Caribou Coffee, and she will want to find out why Caribou is
considering alternatives.
A. adapted buy
B. new buy
C. modified rebuy
D. straight rebuy
E. generic buy

Blooms: Apply
Difficulty: 3 Hard
Feedback: Caribou is apparently looking for a new supplier for a product it has purchased in the past, which makes this a modified rebuy situation.
Kimberly will want to find out why Caribou is not simply executing a straight rebuy, since this will give her insight into the company's unmet needs.
116. Normally, BC bottling company attaches plastic labels to its bottles. However, a new regulation requires that the company now use fabric labels.
To use this latest innovation, BC bottling company must now source these fabric labels from another company. This is an example of
A. a modified rebuy situation.
B. vendor analysis.
C. need recognition.
D. a straight rebuy situation.
E. an RFP.

Blooms: Apply
Difficulty: 3 Hard
Feedback: This new requirement has created a need, setting off the first stage in the B2B buying process.
117. CA Technologies, a firm providing software and services to information technology departments, maintains a corporate blog. How can this blog
help CA Technologies with B2B marketing?
A. as a place to post responses to RFPs
B. by building brand awareness among potential customers
C. by simplifying vendor performance assessment
D. by streamlining purchasing and distribution
E. by matching buyers' requests and sellers' offers
AACSB: Technology
Blooms: Apply
Difficulty: 3 Hard
Feedback: Blogs can be used to build awareness; posts can provide expert advice and create awareness of the company and its offerings.
118. LinkedIn is mainly used for ________ in the B2B marketplace.

A. requests for proposals
B. vendor evaluation
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C. communication with customers
D. professional networking
E. competitive analysis
AACSB: Technology
Blooms: Remember
Difficulty: 1 Easy
Feedback: The LinkedIn.com social network is mainly used for professional networking in the B2B marketplace.
119. Hinsdale High School has recently decided to sponsor a rugby team. It is in the process of considering where to buy the uniforms. This is a
________ situation.
A. straight rebuy
B. new buy
C. straight new buy
D. modified new buy
E. modified rebuy

Blooms: Apply
Difficulty: 3 Hard
Feedback: This is a new buy situation. There is no such thing as a straight new buy.
120. Which step in the buying process is most likely to happen in a straight rebuy situation?
A. product specification
B. RFP process
C. need recognition
D. proposal analysis
E. supplier selection

Blooms: Understand
Feedback: Straight rebuys often enable the buyer to recognize the firm's need and go directly to the fifth step in the B2B buying process, skipping the
product specification, RFP process, and proposal analysis and supplier selection steps.
Essay Questions
121. Jackson owns a bike rental business at a resort destination. He is looking at the number of upcoming bookings to the resort to help him figure out
how many new bikes to purchase for next season. What type of demand is he facing?
Demand for bike rentals will depend on demand for the resort destination. As such, Jackson faces derived demand.

Blooms: Apply
Difficulty: 3 Hard
122. Michelin Tire Company produces a variety of tires at factories in South Carolina. Name three B2B markets in which Michelin might sell its tires.
It would sell to automobile manufacturers, resellers including tire store chains, and possibly to government through specialty military purchases.

Blooms: Apply
Difficulty: 3 Hard
123. Warren used to sell cars at an automobile dealership. Now he sells repossession services to automobile dealers. To be successful, what changes in
the buying process will Warren have to adjust to?
7-28
Warren has moved from B2C sales to B2B sales. In general, B2B sales are more formal and structured. He will probably have to provide more
information in writing, deal with different types of buying centers, and respond to formal vendor analysis.

Blooms: Apply
Difficulty: 3 Hard
124. Ellen is asked to create a vendor analysis process for a physician in private practice, evaluating suppliers of products such as medical supplies.
What should Ellen include in a formal vendor analysis using metrics?
Answers should include the following metrics: delivery (based on promised delivery date), quality customer service, and issue resolution.

Blooms: Apply
Difficulty: 3 Hard
125. Create a realistic example of a B2B buying center, describing the different roles played by members of the team.
Answers will vary, but should include the six roles: initiator, influencer, decider, buyer, user, and gatekeeper.

Blooms: Apply
Difficulty: 3 Hard
126. The buying center concept has parallels in business-to-consumer buying situations when groups are making buying decisions. Describe a situation
where a group of consumers will make a purchasing decision and explain how consumer roles might mirror those in a buying center.
Students might choose a situation such as friends planning a vacation, a family buying a car, or a purchase decision by a social organization. Roles of the
initiator, influencer, decider, buyer, and user should be relatively easy to chart. The gatekeeper role may be a bit more difficult.

Blooms: Analyze
Difficulty: 3 Hard
127. As a business-to-business marketer, would you prefer to market to a firm with an autocratic or a consensus buying center culture, and why?
Students' responses will vary with their own preferences, but should explore the two cultures to demonstrate variations in the kind and number of
contacts that would be required, the nature of the marketing challenge, and distinctions in the kinds of negotiations that might emerge.

Blooms: Evaluate
Difficulty: 3 Hard
128. How are the B2B and B2C buying processes different?
The primary difference is the ultimate user of the service or product. The B2B buying process tends to be more formal and structured than the B2C
process and may include more participants.

Blooms: Understand
129. How is vendor analysis different from a consumer's postpurchase evaluation?
Vendor analysis tends to be more formal and structured than a consumer's postpurchase evaluation.

Blooms: Understand
7-29
130. Vance wants his company to consider using Vonage for VOIP telephone calls instead of its existing telephone provider. He approaches his
supervisor, the telecomm manager, and suggests this change. Describe the role that Vance plays in the buying center concept.
Vance is the initiator, the person who first suggests buying the particular product or service.

Blooms: Understand
131. When Vance proposed switching the company to Vonage for VOIP telephone calls, he had to approach Deborah, assistant to the firm's head of the
purchasing department, to find out how to proceed. Everyone in the company knows that nothing gets purchased without going through Deborah first.
Explain Deborah's role in a buying center.
Deborah plays the role of gatekeeper, the person who controls information or access, or both, to decision makers and influencers.

Blooms: Understand
132. The World Trade Organization creates proposals that are then discussed by more than 150 member countries and not approved until the proposal is
agreeable to all. Describe the type of organizational culture that exists in the WTO.
The WTO has a consensus organizational culture. In a consensus buying center, all members of the team must reach a collective agreement that they can
support a particular purchase.

Blooms: Understand
133. Why is it important for marketers to identify who plays which role in a buying center?
Identifying who plays which role in a buying center is important because it can save a lot of time and it can avoid miscommunication. By identifying
participant roles, marketers can adjust their communications to meet the needs of each participant.

Blooms: Understand
134. When Fulton University built its first dormitories, it hired a consulting engineer to advise the university in choosing an architectural firm and
contractor. For Fulton University, building its first dormitories represented what kind of buying situation?
It represented a new buy situation, and involved many new issues and decisions.

Blooms: Understand
135. Why is it important for sales representatives to know whether a potential business customer is making a new buy or a modified rebuy decision?
A potential customer in a new buy situation will require more information and involve more members of a buying center, while a modified rebuy
situation will involve more comparison of alternatives, and will probably involve a smaller buying center.

Blooms: Evaluate
Difficulty: 3 Hard
136. Identify and give an example of each of the four B2B markets.
The four B2B markets are resellers, manufacturers and service providers, institutions, and governments. Resellers may be wholesalers or distributors
who buy products and then sell them to retailers. Manufacturers buy raw materials, components, and parts that allow them to make and market their own
7-30
goods and ancillary services. Institutions are schools, hospitals, and religious organizations. In most countries, the central government is one of the
largest purchasers of goods and services.

Blooms: Remember
Difficulty: 1 Easy
137. Define derived demand and give an example of how demand for B2B sales is often derived from B2C sales.
Examples will vary, but students should explain that derived demand reflects the link between consumers' demand for a company's output and the
company's purchase of necessary inputs to manufacture or assemble that particular output.

Blooms: Apply
138. Identify the four general types of organizational buying center cultures, and explain how these may impact the approach taken by a salesperson.
The four types of organizational buying cultures are democratic, autocratic, consultative, and consensus. As a salesperson, it is important to understand
the different organizational buying cultures as this may impact how and to whom information about your product is presented. For an autocratic buying
center, you may present to multiple participants but will focus on just one person who will be making the decision. For a democratic buying center, the
salesperson will need to convince multiple people about the product/service, as the majority will rule on the decision. A salesperson presenting to a
consultative buying center will need to have external facts to contribute to describing the product/service. Presenting to a consensus buying center, the
salesperson should find ways to help the buying center members to reach an agreement.

Blooms: Apply
Difficulty: 3 Hard
139. Of the three buying situations, in which one is a salesperson most likely to be involved?
The salesperson is mostly likely to be involved in a new buy situation because the buying organization lacks experience with the item and/or the
company making the sale.

Blooms: Remember
Difficulty: 1 Easy
140. Francesca is a textbook company salesperson about to call on the Philadelphia School District. She would like to know in advance whether the
school district's buying center is autocratic or democratic. What types of behavior might she observe that would help her to tell which of these two types
of buying centers it is? How should she change her sales approach depending on which type it is?
In an autocratic buying center, there may be multiple participants but one person makes the purchase decision alone. If Francesca can identify that
person, she can focus information and attention to the decision maker. In a democratic buying center, a majority vote or opinion will likely determine
which textbooks are adopted. In this environment, Francesca will need to address each buying center member's concerns equally.

Blooms: Analyze
Difficulty: 3 Hard
141. Manufacturers like Volkswagen often have testing departments that test incoming parts and supplies. The primary reason for these
premanufacturing tests is to avoid using faulty materials in the manufacturing process that can cause major problems later on. How might Volkswagen
also use these results in the business-to-business buying process?
There are a few possible answers—for example, if error rates are too high, product specifications might be revised in the future to require higher quality
parts and supplies; however, the best answer is that these results are a vital part of vendor performance assessment.

Blooms: Analyze
Difficulty: 3 Hard
7-31
142. Imagine that you are a sales representative for IBM, selling consulting services. Which of the four types of buying center cultures do you think it
would be easiest to sell to? Using the characteristics of the buying center culture you chose, explain why it was your choice, and how you would
approach selling to that type of buying center.
The student might select any of the four types of buying centers—autocratic, democratic, consultative, or consensus. Some may believe that the
autocratic type would be easiest because the sales rep can focus heavily on the decider and allocate less time to other members of the buying center.

Blooms: Evaluate
Difficulty: 3 Hard
143. Suppose that six months ago, Levi Strauss & Co. began working with a new vendor for zippers, snaps, and other hardware used on its jeans. Now
the buying center wants to assess the new vendor's performance. Describe how Levi Strauss & Co. might perform this assessment. Be specific.
The student might model the assessment after the example in the text. The buying center must decide on a set of criteria on which to evaluate the vendor.
These will probably include product quality, customer service, and promptness of delivery, but may include other things as well. The team will want to
prioritize these issues, possibly assigning each one a weight or importance score. Then, the vendor should be evaluated on each of the criteria. If a total
numeric score is desired, the team could multiply individual criteria scores by the weighting factors and then calculate the sum.

Blooms: Create
Difficulty: 3 Hard
144. Describe the four B2B markets and explain how their transactions differ.
Manufacturers—buy raw materials, components, and parts that allow them to make and market their own goods and services.
Resellers—marketing intermediaries that resell manufactured products without significantly altering their form.
Institutions—hospitals, educational organizations, and religious organizations buy goods and services to fulfill their needs.
Government—major purchaser of goods and services.

Blooms: Understand
145. Explain the advantages and disadvantages of using the RFP process, both for the buying organization and the vendor.
Answers will vary, depending on whether the student has had any experience with RFPs. Advantages for the buyer would include more control over
communicating the specifications to vendors and more competition among vendors, possibly leading to lower prices. Disadvantages might be the time
needed to create the RFP and to manage the responses to it. For vendors, RFPs give them an opportunity to bid for a job that might otherwise not be
available to them, but an RFP can create a lot of extra work for a vendor, and it might be necessary to reduce prices in order to be competitive.

Blooms: Create
Difficulty: 3 Hard
146. A team of people are brought together to purchase new pews for a church. Father Andrew has been trying for years to get the church to buy new
pews, so he is thrilled. Mrs. Swanson, Father Andrew's longtime secretary, feels very strongly that the pews need to be made of maple to match the old
pews, and they need to have cushions for the older people. Everyone is a little afraid of Mrs. Swanson because she manages Father Andrew closely and
no one gets to him without her OK. Mr. Jones called the meeting and is the chair of the committee, so he will ultimately choose which pews they will
purchase. Mrs. Leverett is the treasurer for the church and does all of the ordering. Using the six categories of roles within the buying center, state which
person is fulfilling each role.
Father Andrew is the initiator. Mrs. Swanson is the influencer and the gatekeeper. Mr. Jones is the decider. Mrs. Leverett is the buyer. The parishioners
are the users.

Blooms: Apply
Difficulty: 3 Hard
147. Briefly describe the four types of buying centers and give an example of each.
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In an autocratic buying center, though there may be multiple participants, one person makes the decision alone, whereas the majority rules in a
democratic buying center. Consultative buying centers use one person to make a decision but solicit input from others before doing so. Finally, in a
consensus buying center, all members of the team must reach a collective agreement that they can support a particular purchase. Examples will vary.

Blooms: Apply
Difficulty: 3 Hard
148. Name three ways a B2B marketer can enhance customer relationships.
Blogs and social media can build awareness, provide search engine results, educate potential and existing clients about products or services, and warm
up a seemingly cold corporate culture. Web analytics, such as traffic on the website and the number of comments, can offer tangible evaluations.

Blooms: Apply
Difficulty: 3 Hard
149. What is a new buy, and what steps in the buying process does it typically go through?
In a new buy situation, a customer purchases a good or service for the first time, which means the buying decision is likely to be quite involved because
the buyer or the buying organization does not have any experience with the item. In the B2B context, the buying center is likely to proceed through all
six steps in the buying process and involve many people in the buying decision.

Blooms: Understand
150. Describe a straight rebuy situation, and explain how it differs from a modified rebuy.
Straight rebuys occur when the buyer or buying organization simply buys additional units of products that had previously been purchased. In a modified
rebuy, the buyer has purchased a similar product in the past but has decided to change some specifications, such as the desired price, quality level,
customer service level, options, and so on.

Blooms: Understand
151. When most of us think of Amazon, we think about what we, as consumers, can buy there—currently, just about anything. But Amazon is much
more than just a company that supplies consumers with books, household products, clothing, and so forth. Describe Amazon's business-to-business
(B2B) transactions.
Amazon's business-to-business (B2B) transactions are significant and permeate multiple areas. The symbiotic relationships that Amazon has with its
third-party providers are significant and likely to continue expanding in the future. Similar to other online marketplaces such as eBay, Amazon derives
significant revenues by using third-party providers. These entities expand its marketplace presence by providing its customers a larger assortment of
merchandise. Amazon also has close B2B relationships with traditional delivery services, even though it has been expanding its own delivery
capabilities. It continues to rely heavily on the U.S. Postal Service. Another piece of Amazon’s B2B puzzle is its robot army. Over the course of a
decade, it has purchased and put into service more than 30,000 Kiva warehouse robots to automate its fulfillment centers. At one point, Amazon
cultivated B2B relationships with other companies by selling them robots so that they could automate their own supply chains. More recently though,
having recognized that the Kivas are part of its own sustainable competitive advantage, it has renamed them simply Amazon robots, stopped supplying
them to other firms, and are using all of Kiva’s production internally. In this way, rather than expand its B2B sales, Amazon has attempted to limit the
sale of robots (and patented its technology) so that it can maintain its dominance in other categories

Blooms: Understand
152. As their computing power and security demands escalate, few businesses want to maintain their own hardware and servers anymore. Instead, they
look to the cloud, where they seek to purchase more computing power, provided at a faster speed, with lower costs. Describe IBM's response to this
customer need and the services provided by the cloud.
7-33
In response, traditional mainframe providers such as IBM are moving to expand their presence in the cloud. In particular, IBM has devoted billions of
dollars to enhancing its cloud capabilities. First, it purchased a cloud company called SoftLayer for $2 billion to add that firm’s 13 cloud computing
centers to IBM’s own 12 data centers. Second, it is allocating an additional $1.2 billion to expand its cloud computing centers worldwide. The services
provided by these cloud centers will include not just power and data storage but also access to some of IBM’s proprietary software and related products.
Perhaps most famously, for some of the best IBM clients it will offer access to Watson, IBM’s famous Jeopardy-winning computer.

Blooms: Understand
Category # of Questions
AACSB: Analytical Thinking 80
AACSB: Knowledge Application 66
AACSB: Technology 6
Accessibility: Keyboard Navigation 120
Blooms: Analyze 3
Blooms: Apply 57
Blooms: Create 2
Blooms: Evaluate 4
Blooms: Remember 34
Blooms: Understand 52
Difficulty: 1 Easy 35
Difficulty: 2 Medium 53
Difficulty: 3 Hard 64
Learning Objective: 07-01 Describe the ways in which business-to-business (B2B) firms segment their markets. 30
Learning Objective: 07-02 List the steps in the B2B buying process. 34
Learning Objective: 07-03 Identify the roles within the buying center. 24
Learning Objective: 07-04 Describe the different types of organizational cultures. 27
Learning Objective: 07-05 Detail different buying situations. 37
Topic: Allocating Resources 1
Topic: B2B Buying Process 49
Topic: Buyer-seller Relationships 24
Topic: Buying Center 47
Topic: Buying Situations 30
Topic: Product Value Creation 1
7-34
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AACSB: Analytical Thinking

2. B2B marketing involves manufacturers, wholesalers, and service firms.

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Analytical Thinking

7. Organizational culture may vary by geography.

AACSB: Analytical Thinking

Feedback: Organizational culture may vary by geography, by division, or by functional department.

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Knowledge Application

AACSB: Analytical Thinking

AACSB: Knowledge Application

AACSB: Knowledge Application

Feedback: Fabricworld is a reseller. A retailer sells directly to a consumer.

15. Public institutions do not engage in B2B relationships.

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Knowledge Application

AACSB: Analytical Thinking

AACSB: Knowledge Application

AACSB: Knowledge Application

AACSB: Analytical Thinking

Feedback: This is the definition of consultative buying centers.

AACSB: Knowledge Application

AACSB: Knowledge Application

Multiple Choice Questions

AACSB: Analytical Thinking

AACSB: Knowledge Application

AACSB: Knowledge Application

AACSB: Knowledge Application

AACSB: Knowledge Application

31. Whether targeting consumers or resellers, marketers need to focus on

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Analytical Thinking

Feedback: Resellers include wholesalers, distributors, and retailers.

AACSB: Knowledge Application

AACSB: Analytical Thinking

36. Which of the following is an example of an institutional buyer?

37. Which of the following is an example of a government buyer?

AACSB: Knowledge Application

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Analytical Thinking

41. Typically, B2B buyers ask potential suppliers to

AACSB: Analytical Thinking

42. B2B buying decisions are often made by

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Analytical Thinking

AACSB: Knowledge Application

AACSB: Knowledge Application

AACSB: Analytical Thinking

49. During the RFP stage, B2B buyers

AACSB: Analytical Thinking

AACSB: Analytical Thinking