Final International Marketing Exam

All of the listed advantages are for "extension or ethnocentric" pricing strategy except:

a. it does not respond to the competitive and market conditions of each national market.

b. it calls for the per-unit price of an item to be the same all over the world.

c. it is extremely simple since it does not require information on market condition.

d. it does not require competitive conditions for implementation.

e. the importer must absorb freight and import duties.

a. it does not respond to the competitive and market conditions of each national market.

When Tag Heuer, a marketer of luxury watches, takes out newspaper ads urging consumers to purchase Tag Heuer products from authorized dealers only, the company is most likely attempting to combat the ________ problem.

a. countertrade

b. market holding

c. price escalation

d. gray market

e. market skimming

d. gray market

When Sony introduced the first consumer VCRs in the 1970s, the retail price exceeded $1,000. Within a few years, the price dropped well below $500. This is an example of:

a. skimming strategy

b. penetration strategy

c. cost-based strategy

d. price ceiling

e. transfer pricing

a. skimming strategy

A market ________ pricing strategy calls for setting price levels that are low enough to quickly build market share.

a. gray

b. skimming

c. penetration

d. holding

e. cost-based

c. penetration

A manufacturer attempting to set prices for its products in export markets must realize that CIF, VAT, and distributor markup all lead to:

a.currency devaluations.

b.dumping charges.

c.market skimming.

d.price escalation.

e.market penetration.

d.price escalation.

Parallel importing occurs when companies employ a(n) ________ multinational pricing policy that calls for setting different prices in different country markets.

a. ethnocentric

b. polycentric

c. regiocentric

d. geocentric

e. extension

b. polycentric

If company managers decide to set the export price for a particular product at an amount equivalent to the home-country price, they would be using which approach to pricing?

a. ethnocentric

b. polycentric

c. regiocentric

d. geocentric

e. extension pricing

a. ethnocentric

___________ gives the audience a feeling of being a "world citizen" or "part of something bigger." Coke's Hilltop commercial is a good example.

a. Foreign consumer culture

b. Global consumer culture

c. Local strategy

d. Mixed strategy

e. Pattern advertising

b. Global consumer culture

________ pricing recognizes that several factors such as local costs, income levels, competition, and local marketing strategy are relevant to the pricing decision

a. ethnocentric

b. polycentric

c. geocentric

d. extension

e. adaptation

c. geocentric

Which of the following would not be taken into account by a company using an ethnocentric approach to pricing decisions?

a. the possibility of implementing a penetration strategy

b. profitable price points that could be tied to local sourcing as opposed to home-country sourcing

c. integration of price with other marketing mix elements

d. factors unique to individual country markets

e. None of the above would be taken into account by a company using ethnocentric pricing.

e. None of the above would be taken into account by a company using ethnocentric pricing.

Which positioning gives a brand name more power and value as well as increase the users' attributions of self-worth and status?

a. Mixed strategy

b. Foreign consumer culture

c. Local strategy

d. Global consumer culture

e. Pattern advertising

d. Global consumer culture

In __________, billboards are #1 media because, in a city built for 30,000 cars, there are 3 million, creating massive traffic jams and captive audiences.

a. Copenhagen, Denmark

b. Moscow, Russia

c. Mumbai, India

d. Oslo, Norway

e. Stockholm, Sweden

b. Moscow, Russia

The unauthorized distribution of trademarked goods to exploit price differentials in world markets is known as:

a. market skimming.

b. black marketing.

c. gray marketing.

d. dumping.

e.licensing.

c. gray marketing.

________ is the phrase global marketers use to describe ads with common design elements into which localized elements are inserted for individual country markets.

a. Pattern advertising

b. Template advertising

c. Cookie-cutter advertising

d. Model advertising

e. Stereotype advertising

a. Pattern advertising

Suppose a company selling in various country markets makes statements such as "we know what the customer wants, and he or she will have to pay for it." This is an indication of a(n) ________ approach to setting prices.

a. ethnocentric

b.polycentric

c.regiocentric

d.geocentric

e.adaptation

a. ethnocentric

Which statement is NOT related to the "globalization perspective" of promotion?

a. needs are the same across the globe

b. cost perspective

c. least common denominator thinking

d. economic, cultural, and political difference demand different product and communication strategies

d. economic, cultural, and political difference demand different product and communication strategies

If the manufacturer of a sophisticated new consumer electronics product determines that many target consumers qualify as "innovators" and "early adopters" with relatively inelastic demand curves, the company should use the ________ pricing strategy.

a. gray market

b. skimming

c. penetration

d. market holding

e. cost-based

b. skimming

According to a recent study of European industrial exporters, companies that utilized independent distributors would be most likely to utilize:

a.ethnocentric pricing.

b.polycentric pricing.

c.regiocentric pricing.

d.geocentric pricing.

e.extension pricing.

b.polycentric pricing.

Which promotional mix element is most closely associated with activities designed to foster goodwill and understanding with various constituents both inside and outside the company?

a.personal selling

b. advertising

c. public relations

d. sales promotions

e. packaging

c. public relations

In which country are global marketers likely to encounter the most restrictions on advertising?

a. the United States

b. Japan

c. Saudi Arabia

d. Russia

e. Germany

c. Saudi Arabia

France is known for wine, Germany for beer, and Italy for espresso. That is why many wine brand names are French, beer brand names are German, and coffee brand names are Italian.

a. Foreign consumer culture

b. Mixed strategy

c. Local strategy

d. Local strategy

e. Global consumer culture

a. Foreign consumer culture

To promote their high definition 3D televisions, Samsung hosted an exhibition at the Petit Palais, one of Paris's foremost art museums. Each TV displayed a masterpiece of fine art.

Which strategy is it?

a. Global consumer culture

b. Foreign consumer culture

c. Mixed strategy

d. Pattern advertising

e. Local strategy

e. Local strategy

Which of the following is an appropriate guideline for companies selecting independent distributors in international markets?

a.Select distributors; don't let them select you.

b.Look for distributors capable of developing markets.

c.Treat local distributors as long-term partners.

d.Maintain control over marketing strategy from day one.

e.All of the above are appropriate guidelines.

e.All of the above are appropriate guidelines.

When Walmart stores first expanded into Mexico, management established a joint venture with the country's largest retailer. Judging by the approach Walmart used, management must have viewed Mexico as:

a.culturally close and easy to enter.

b.culturally distant and easy to enter.

c.culturally close and difficult to enter.

d.culturally distant and difficult to enter.

e.culturally difficult and easy to enter.

d.culturally distant and difficult to enter.

When companies adopt an indirect involvement channel they have all of the following activities except:

a.utilize independent agents.

b.use distributors.

c.utilize retailers.

d.establish their own sales force.

e.utilize those who have network of stores.

d.establish their own sales force.

When British entrepreneur Richard Branson established the first Virgin Megastore in France, he invested a great deal of money to develop a retail space on the famous Champs-Elysées. Judging by the approach Branson used, he and his management team must have viewed France as:

a.culturally close and easy to enter.

b.culturally distant and easy to enter.

c.culturally close and difficult to enter.

d.culturally distant and difficult to enter.

e.culturally difficult and easy to enter.

a.culturally close and easy to enter.

Saks Fifth Avenue has ________ stores in the Middle East.

a. licensed

b. organic

c. franchise

d. joint venture

e. own-label focus

a. licensed

Channel decisions are important because:

a.commitments are flexible.

b.relationships change with time.

c.it is expensive to terminate.

d.issues can be solved by arbitration.

e.local laws do not protect agreements.

c.it is expensive to terminate.

Departmentalized, single-story retail establishments that offer food and nonfood items, mostly on a self-service basis are called:

a. Specialty retailers.

b. Supermarkets.

c. Convenience stores.

d. Discount retailers.

e. Hyper markets.

b. Supermarkets.

Which of the following does not qualify as a "category killer?"

a.Victoria's Secret

b.IKEA

c. Home Depot

d. Best Buy

e. Toys"R"Us

a.Victoria's Secret

Which approach to retail expansion is most appropriate when targeting a country that management considers both culturally close and easy to enter?

a. organic growth

b. chain acquisition

c. franchise

d. joint venture

e. own-label focus

a. organic growth

By definition, ________ feature a narrow but deep merchandise mix and high levels of service.

a.department stores

b.specialty retailers

c.supermarkets

d. convenience stores

e. discount stores

b.specialty retailers

The introduction of consumer VCRs in the late 1970s initiated a revolutionized in-home electronic entertainment. For example, assuming the user could learn to set the timer, he or she could tape programs to watch at a later time. The VCR's popularity also gave rise to an entirely new retailing concept, the video rental store. What type of innovation did the consumer VCR represent?

a.a continuous innovation

b.a dynamically continuous innovation

c.a discontinuous innovation

d.a comparative innovation

e.none of the above

c.a discontinuous innovation

By definition, a ________ requires a large amount of learning on the part of users and typically creates new markets and consumption patterns.

a.continuous innovation

b.dynamically continuous innovation

c.Discontinuous innovation

c.Discontinuous innovation

The Advanced Photo System (APS) created by Kodak and its partners combines traditional chemical photo processing with digital technology. One benefit of the system is that shutterbugs can choose three different print sizes. The APS would best be described as a:

a. continuous innovation.

b.dynamically continuous innovation.

c.discontinuous innovation.

d.platform-based innovation.

e.new and improved innovation.

b.dynamically continuous innovation.

Dry soup mixes that have long been popular in Europe are marketed as sauces or dips in the United States. This is an example of the ________ strategy.

a.product-communications extension

b.product extension-communications adaptation

c.product adaptation-communications extension

d. dual adaptation

e.product invention

b.product extension-communications adaptation

Targeting the 300 million farmers in India who still use plows harnessed to oxen, John Deere engineers created a line of relatively inexpensive, no-frills tractors. The Deere team then realized that the same equipment could be marketed to hobby farmers and acreage owners in the United States, a segment that they had previously overlooked. This is an example of ________ strategy.

a.product-communications extension

b.product extension-communications adaptation

c.product adaptation-communications extension

d.dual adaptation

e.product invention

b.product extension-communications adaptation

Before Ben & Jerry's launched their ice cream in the United Kingdom, the company conducted extensive research to determine whether the package design was appropriate. The research indicated that British consumers perceived the colors differently than U.S. consumers. The package design was changed accordingly. This type of strategy can be defined as:

a. product-communications extension.

b.product extension-communications adaptation.

c.product adaptation-communications extension.

d.product-communication adaptation.

e.product invention.

b.product extension-communications adaptation.

As outlined by branding expert Kevin Keller, the benefits of strong brand equity include all of the following except:

a. greater loyalty.

b. more vulnerability to marketing actions.

c. less vulnerability to marketing crises.

d.more inelastic consumer response to price increases.

e.more elastic consumer response to price decreases.

b. more vulnerability to marketing actions.

Products that belong to the category of "game changers" are considered as ________ innovations.

a.new product

b.line extensions

c.continuous

d.dynamically continuous

e.discontinuous

e.discontinuous

In Chinese markets, Nike had a problem using the "Just Do It" attitude which was found not to be appropriate. Finally, Nike decided to use Chinese athletes in their promotion. This type of adaptation was needed due to:

a.the Chinese do not wear running shoes.

b.ingrained Chinese values which respect authority.

c.Chinese athletes use Nike shoes.

d."Just do it" in Chinese has a negative connotation.

e.parents do not want their children to see such ads.

b.ingrained Chinese values which respect authority.

Prior to 2004, Nokia launched different cell phone products in different countries at different times. Nokia also used different advertising images and messages in different countries. Which approach to the world marketplace was Nokia using?

a. product-communications (dual) extension

b.product extension-communications adaptation

c. product adaptation-communications extension

d.product-communication (dual) adaptation

e.product invention

d.product-communication (dual) adaptation

Campbell's has been marketing soup in Japan for more than 40 years. Early on, Japanese consumers were not receptive to ads featuring the Campbell Kids and the "M'm M'm Good" slogan. This compelled Campbell's to develop ads featuring a talking soup can known as "Mr. Campbell." Campbell's also developed soup varieties for Japan with fish as the main protein source and spices that reflect local preferences. As described here, which of the following strategies has Campbell's used in Japan?

a.product-communications extension

b.product extension-communications adaptation

c.product adaptation-communications extension

d.product-communication adaptation

e. product invention

d.product-communication adaptation

Motorola's failed Iridium venture was a global satellite telephone network designed to allow users to make or receive calls anywhere on the globe using handsets that are somewhat bigger than typical cellular phones. What type of innovation did Iridium represent?

a.a continuous innovation

b.a dynamically continuous innovation

c.a discontinuous innovation

b.a dynamically continuous innovation

Procter & Gamble recently introduced Pampers Rash Guard. Rash Guard does not represent a new product per se; rather, the diapers are being marketed as an alternative to regular Pampers. What type of innovation do Pampers Rash Guard diapers represent?

a.a continuous innovation

b.a dynamically continuous innovation

c.a discontinuous innovation

d.a platform-based innovation

e.none of the above

a.a continuous innovation

________ represents the cumulative added value of a company's investment in the marketing of a brand over time.

a. A brand extension

b. Co-branding

c. Brand image

d. Brand equity

e. Brand loyalty

d. Brand equity

Starbucks plans to have 6,000 stores in China by 2022. To achieve the goal, what did Starbucks do in China in 2017?

a. licensing

b. contract manufacturing

c. joint venture

d. full ownership

e. global strategic alliance

d. full ownership

Disadvantages of joint venturing can include all of the following except:

a.joint venture partners must share rewards as well as risks.

b.joint ventures allow partners to achieve synergy.

c.joint ventures can have the potential for conflict between partners.

d.a dynamic joint venture partner can evolve into a strong competitor.

e.a company incurs very significant costs by joint venturing.

b.joint ventures allow partners to achieve synergy.

The terminology used to describe the new forms of cooperation strategies varies widely and the phrases used include all of the following EXCEPT:

a. collaborative agreements

b. strategic alliances

c. global strategic partnerships

d. strategic international alliances

e. greenfield operations

e. greenfield operations

Having partners from another country can have advantages which include all of the following except:

a.reducing product development costs.

b.securing technology.

c.access to capital.

d.shared risks.

e.increased competition.

e.increased competition.

One of the advantages of licensing is:

a.licensees have limited control.

b.licensees have considerable autonomy.

c.license agreements have short life.

d.licensees can develop similar products.

e.licensees have considerable leverage.

b.licensees have considerable autonomy.

A(n) ________ is an entry strategy for a single target country in which the partners share ownership of a newly created business entity.

a. acquisition

b. licensing

c. franchising

d. joint venture

e. exporting

d. joint venture

________ represents a market entry strategy whereby one company permits a foreign company to make use of its patents, know-how, technology, company name, or other intangible assets in return for a royalty payment.

a. joint venture

b. 100-percent ownership

c. licensing

d. exporting

e. global strategic alliance

c. licensing

For Walt Disney Company, the best mode for going global is by

a. joint ventures

b. licensing

c. 100-percent ownership

d. exporting

e. franchising

b. licensing

Which of the following is NOT a characteristic of global strategic alliances?

a. Participants maintain independence outside the framework of alliance.

b. Participants share benefits as well as control.

c. Participants make ongoing contributions in technology, products, and other areas.

d. Participants focus on an individual country market.

e. Participants share benefits of the alliance.

d. Participants focus on an individual country market.

As a general rule, the Chinese government allows foreign companies to participate in its market only if those companies agree to establish operations with local Chinese enterprises. Which market entry mode would be the appropriate choice under these circumstances?

a. acquiring

b. licensing

c. joint venture

d. exporting

e. franchising

c. joint venture

For Starbucks and other companies whose business models include a service component, it is NOT recommended that they use one of the following methods for going global.

a. joint ventures

b. licensing

c. 100-percent ownership

d. exporting

e. franchising

d. exporting

Licensing as a market entry mode has several disadvantages and opportunity costs, which does NOT include:

a. limited market control.

b. agreement may have short life.

c.leveraging and exploiting by licensee.

d.similar product or technology development by licensee.

e.adaptations by licensee to fit local tastes.

e.adaptations by licensee to fit local tastes.

Honda has invested $550 million in building an assembly plant in Greensburg, Indiana; IKEA spent nearly $2 billion to open stores in Russia; and South Korea's LG Electronics purchased a 58% stake in Zenith Electronics. All of these are examples of:

a. acquisition

b. licensing

c. franchising

d. foreign direct investment (FDI)

e. exporting

d. foreign direct investment (FDI)