Marketing Exam 2 - Chapter 6

______ refers to the strategic combination of the four basic marketing makes elements

The marketing program

Most firms today, compete and mature markets characterized by commoditization. In these case, the _________ typically becomes incapable of differentiating the product offering from those of the competition

Core product

Although the product is at the heart of the marketing program, it is important to remember that product offerings in and out themselves have a little value to customers. And offerings real value comes from:

It's ability to deliver benefits that solve a customer's problem

Mallory is an avid collector of antiques. In fact, she spends practically every weekend traveling to small town in antique shops in search of unique antique treasures. For Mallory antiques are a perfect example of:

Specialty product

Which of the following is the best example of an unsought product?

Insurance

For laptop, computer, computers, processor, chips, memory chips, and hard drives are example examples of ______ because they are finished items that become a part of the computer after assembly

Component parts

Firestone carefully watches the automotive market to ascertain the demand for cars, SUVs and trucks. Firestone does this because of the demand for its products and is dependent on the demand for automobiles. This situation describes ______

Derived demand

Why would a firm offer a deep assortment of products in it's product portfolio?

To attract a wide range of customers and market segments

Why would a firm offer a wide variety of products and its product portfolio?

To diversify its risk

Why is the demand for most services such as popular restaurants extremely time and place dependent?

Because customers must be present for service to be delivered

Which of the following is not an important benefit of offering a large product portfolio?

Package differentiation

Unlike tangible goods virtual gate, all services are susceptible to inconsistency and variations and quality. Why is this so?

Because services depend on people for their delivery

The phrase, "unused service capacity is lost forever" refers to which major challenge associated with the marketing of services?

Perishability

To compete and fast growing hybrid segments, Honda introduced the Civic hybrid with unique styling and great fuel economy. The Civic hybrid was based on the traditional Honda Civic. Which product development strategy has Honda implemented?

Product line extension

Assume kya has developed a new product idea to launch a midsize pick up. Currently, kya is developing a prototype and working on projected costs revenue and profit potential. Kya is currently at what stage of the new product development process?

Screening and evaluation

Why are firms so obsessed with the pricing element of the marketing mix?

Because the firms pricing has a direct bearing on its ability to increase revenue

Although break even analysis and cost plus pricing are important tools, and setting prices based on the firms cost structure. They should never be the driving force behind pricing strategy. Why?

Because different firms have different structures

_______ is defined as a customers subjective evaluation of benefits relative to cost to determine the worth of a firm product offering relative to other product offerings

Value

Which of the following statements is true with respect to the relationship between price and revenue?

Price cuts must be offset by an increase in sales volume to keep the same level of revenue

Which pricing objective is associated with the phrase "charging with the market will bear"?

Market demand

Price elasticity is defined as

Customers responsiveness or sensitivity to changes in price

Which of the following is not a situation that can cause customers to be less sensitive to price increases?

When the total expenditure is high

The inherit goal of product differentiation is to make the demand curve for a product more in elastic. This happens because increased differentiation:

Reduces the number of perceived substitutes for your product

Because service capacity is perishable and service demand is highly time dependent, service firms, employee yield management strategies in an effort to:

Balance, price, and revenue considerations with their need to fill unused capacity

The goal of _______ is to maximize sales gain widespread market acceptance, and capture a large market share quickly by setting a relatively low initial price

Penetration pricing

The Fairmont hotel is widely known for its exceptional quality and impeccable customer service. Not surprisingly, the Fairmont sets prices at the top end of all competing hotels. Which pricing strategy is the Fairmont using?

Prestige pricing

Firm such as IKEA and the Home Depot are known for their use of _________ because they can sit reasonably low prices, but still offer a high-quality products and adequate customer services

Value based pricing

The club is a local hair salon and Day spa that caters to an upper middle class clientele. Although price competition in the local area has been increasing, the owners of the club had decided to focus their marketing efforts on quality service and value, and to resist the temptation to compete on price. And pursuing this non-price strategy managers of the club are ascribing to which of the following assumptions?

It is difficult for competitors to copy the clubs, differentiating characteristics

Retailers use ________ extensively. This occurs when the retailers compare sales price to regular prices such as when Best Buy promotes a DVD player as $49.99.

Reference pricing

In business markets, _________ is used to quote prices in terms of reductions or increases based on transportation cost, or the actual physical distance between the buyer and the seller.

Geographic pricing

_____ is an organized system of marketing institutions through which products, resources, information, funds and/or product ownership flow from the point of production to the final user. a.

marketing network

marketing channel

Ensuring the availability of products in the right place in the right quantities at the right time in a cost efficient manner is the main focus of:

physical distribution.

The creation of an extended enterprise in the supply chain depends heavily on the ability of channel members to integrate their operations. Which of the following IS NOT a key factor in successful supply chain integration?

coercive power

The most basic benefit of marketing channels is ______ where channels reduce the number of contacts necessary to exchange products.

contact efficiency

In terms of marketing channel functions, which of the following statements describes the concept of discrepancy of quantity?

Manufacturers produce large quantities; customers usually want only one item

Which member of the marketing channel has the primary responsibility of fulfilling the channels main functions?

It does not matter.

In the Mercedes dealer network, individual dealers are given the sole right to sell Mercedes vehicles within a defined geographic area. What type of distribution does Mercedes employ?

exclusive distribution

What is the most appropriate type of distribution to use when customers need the opportunity to comparison shop, or when after-sale services are important?

selective distribution

Many products, such as candy, soft drinks, and gym are sold via intensive distribution. However, this strategy has a major drawback. What is it?

The manufacturer must give up a good degree of control over pricing and product display.

Because the company was angered by the actions of its resellers, Acme Manufacturing decided to slow down deliveries and postpone product availability to these resellers. What type of power is Acme wielding in the channel?

Coercive Power

Which of the following statements best describes the term "slotting allowances"?

A fee, paid by manufacturers to retailers, to get a product placed on retail shelves.

In most marketing channels for consumer products, the balance of power has shifted to _______ due to their size and buying power.

mass merchandise retailers

Today, though cutting expenses is still a main factor, the desire of many firms to focus on core competencies is a driving force behind the increase in:

outsourcing

Hallmark is a good example of a company that uses ______ distribution as a means of offering two or more lines of the same merchandise through two or more channels

dual

Overall, the trends occurring in marketing channels today (growth in e-commerce, outsourcing, growth of nontraditional channels) have one major theme in common. What is that theme?

Increasing channel efficiency by reducing waste, overhead, and other costs.Securing more power and control for manufacturers.

Which of the following statements about integrated marketing communications is false?

The role of mass television advertising is growing more important to IMC strategy.

To be successful, firms must move potential customers beyond mere interest in the product. Good promotion will stimulate _____ by convincing potential customers of the product's superiority and its ability to satisfy specific needs.

desire

In terms of the AIDA model, mass communication elements such as advertising and public relations tend to be very effective at:

stimulating awareness of and interest in a product.

When firms use a(n) _____

strategy, they focus their promotional efforts toward stimulating demand among final customers, then exert pressure on the supply chain to carry the product.

pull

In launching a new line of power tools, Black & Decker considerable amount of time and resources to educate, motivate, and compensate members of its supply chain. By investing heavily in this type of promotion, Black & Decker hopes its ______ strategy will lead to a more effective product launch

push

Which of the following is perhaps the main advantage associated with the use of advertising?

It is an extremely cost efficient way to reach a large number of people.

In the context of IMC strategy, what is the difference between public relations and publicity?

Publicity is more narrowly defined and focused on gaining media attention.

Overall, what is the major disadvantage associated with the use of public relations and publicity?

The firm has limited control over how the message will be delivered or interpreted.

_____ is paid personal communication that attempts to inform customers about products and persuade them to purchase those products.

Personal selling

In today's economy, personal selling has evolved to take on elements of customer service and

marketing research. Why is this the case?

Personal selling focuses more on developing customer relationships than on generating

Which sales force compensation system is best suited to situations where salespeople are responsible for pre- and post-sale service and sales managers want maximum control over selling expenses?

straight salary

Despite conventional thinking, ______

accounts for the bulk of promotional spending in many firms. This is especially true for firms selling consumer products in grocery stores and mass-merchandise retailers.

sales promotion

Which of the following statements best represents the universal goal of all sales promotion activities?

To induce product trial and purchase.

Which of the following sales promotion methods would you recommend to a packaged goods marketer who wants to stimulate trial of a new product?

a free sample of the product

A price reduction offered to channel intermediaries for purchasing specified quantities of a product at a single time is called a:

buying allowance.