MKTG Management Chapter 18

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Dr. Gonzalez, Trinity University, Fall 2012

B

1) An ________ is a specific communications task and achievement level to be accomplished with a specific audience in a specific period of time.
A) advertising medium
B) advertising objective
C) advertising channel
D) advertising budget
E) advertising copy

A

2) ________ aims to create brand awareness and knowledge of new products or new features of existing products.
A) Informative advertising
B) Corporate advertising
C) Reinforcement advertising
D) Persuasive advertising
E) Reminder advertising

E

3) Which of the following is an example of informational advertising?
A) Volkswagen famed "Drivers Wanted" campaign
B) Pringles campaign with the tagline "Once You Pop, the Fun Don't Stop"
C) KFC's fast-food range that it claims to be "Finger Lickin' Good"
D) The California Milk Processor Board's famous "Got Milk" campaign
E) Excedrin's ads that claim it stops the toughest headache

C

4) ________ aims to create liking, preference, conviction, and purchase of a product or service.
A) Corporate advertising
B) Reminder advertising
C) Persuasive advertising
D) Reinforcement advertising
E) Informational advertising

C

5) Comparative advertising works best when ________.
A) it elicits cognitive and behavioral motivations simultaneously
B) the firm is trying to minimize brand dilution
C) consumers are processing advertising in a detailed, analytical mode
D) it elicits affective motivation, followed by cognitive motivation
E) the advertising message uses negative fear appeals

E

6) ________ aims to stimulate repeat purchase of products and services.
A) Reinforcement advertising
B) Comparative advertising
C) Persuasive advertising
D) Informational advertising
E) Reminder advertising

B

7) The "Got Milk" campaign was intended to boost the sagging milk consumption among Californians in the 1990s. The campaign ads highlighted the inconvenience of running out of milk when intended to be used with certain foods, such as cookies or muffins, advising consumers to stock up on milk to avoid such inconveniences. The "Got Milk?" campaign an example of ________.
A) informational advertising
B) reminder advertising
C) institutional advertising
D) comparative advertising
E) reinforcement advertising

C

8) ________ aims to convince current purchasers that they made the right choice.
A) Persuasive advertising
B) Informational advertising
C) Reinforcement advertising
D) Reminder advertising
E) Comparative advertising

D

9) Which of the following conditions necessitates that the objective of advertising should be to stimulate more usage of a product?
A) the advertised product belongs to a nascent product category
B) the company is not the market leader
C) the advertised brand is superior to the market leader
D) the product class is mature
E) brand usage for the product is very high

C

10) Which of the following statements is true of the factors that affect an advertising budget?
A) High-market-share brands usually require proportionately high advertising expenditure as a percentage of sales to maintain share.
B) Brands in less-differentiated or commodity-like product classes require very less advertising to establish a unique image.
C) New products typically merit large advertising budgets to build awareness and to gain consumer trial.
D) In a market with few competitors and moderate advertising spending, a brand must advertise more heavily to be heard.
E) Established brands usually are supported with high advertising budgets, measured as a ratio to sales.

E

11) Marketers often cut the cost of advertising dramatically by using consumers as their creative team. This strategy is known as ________.
A) disintermediation
B) public relations
C) vertical integration
D) reintermediation
E) crowdsourcing

A

12) Which of the following is generally acknowledged as the most powerful advertising medium and reaches a broad spectrum of consumers at low cost per exposure?
A) television
B) radio
C) newspapers
D) magazines
E) billboards

C

13) TV advertising is considered to be particularly advantageous because ________.
A) the low volume of nonprogramming material on television makes it difficult for consumers to ignore or forget ads
B) it provides detailed product information and effectively communicates user and usage imagery
C) it can vividly demonstrate product attributes and persuasively explain their corresponding consumer benefits
D) TV channels are very targeted, ads are relatively inexpensive to produce and place, and short closings allow for quick response
E) it lets companies achieve a balance between broad and localized market coverage

A

14) According to researchers, which of the following is the correct order in which content of print advertisements matter?
A) picture-headline-copy
B) copy-picture-headline
C) headline-copy-picture
D) picture-copy-headline
E) copy-headline-picture

D

15) Which of the following is the main advantage of radio as an advertising medium?
A) low competition
B) more attention than television
C) longer duration of ad exposure
D) flexibility
E) standardized rate structures

A

16) ________ refers to simple exaggerations in advertisements that are not meant to be believed and that are permitted by law.
A) Puffery
B) Boosterism
C) Astroturfing
D) Doublethink
E) Subliminal advertising

C

17) Which of the following organizations uses top-notch industry talent to produce and distribute public service announcements for nonprofits and government agencies?
A) the Association of National Advertisers
B) the International Advertising Association
C) the Ad Council
D) the National Advertising Review Council
E) the Advertising Research Foundation

C

18) ________ is finding the most cost-effective media to deliver the desired number and type of exposures to the target audience.
A) Media scheduling
B) Content analysis
C) Media selection
D) Communication design
E) Copy testing

D

19) The number of different persons or households exposed to a particular media schedule at least once during a specified time period is known as ________.
A) range
B) impact
C) intensity
D) reach
E) frequency

B

20) The number of times within a specified time period that an average person or household is exposed to an advertising message is known as ________.
A) impact
B) frequency
C) amplitude
D) reach
E) depth

D

21) The qualitative value of an exposure through a given medium is known as ________.
A) frequency
B) reach
C) amplitude
D) impact
E) range

A

22) Which of the following equations accurately describes the total number of exposures (E) of an advertising message through a given medium?
A) E = reach * frequency
B) E = (reach * frequency) / impact
C) E = reach frequency impact
D) E = (reach + frequency) / impact
E) E = frequency / reach

C

23) The weighted number of exposures (WE) of an advertising message over a given medium is given by ________.
A) WE = reach * frequency
B) WE = (reach * frequency) / impact
C) WE = reach frequency impact
D) WE = (reach + frequency) / impact
E) WE = frequency / reach

C

24) Under which of the following conditions is the reach of media the most important factor in media selection?
A) when introducing frequently purchased brands
B) when going into a defined target market
C) when launching extensions of well-known brands
D) when there are strong competitors to a brand
E) when there is high consumer resistance to the product

D

25) Under which of the following conditions is the frequency the most important factor in media selection?
A) when introducing flanker brands
B) when launching infrequently purchased brands
C) when going into undefined target markets
D) when there is high consumer resistance to the product
E) when there is modest competition to the brand in the market

D

26) What is the gross rating points (GRP) for a media schedule that reaches 60 percent of homes with an average exposure frequency of 4 and impact of 1.5?
A) 15
B) 160
C) 360
D) 240
E) 10

C

27) What is the weighted number of exposures of a media schedule that reaches 80 percent of the target audience, with an exposure frequency of 4 and impact value of 2?
A) 320
B) 10
C) 640
D) 160
E) 240

E

28) Which of the following is an advantage of using newspapers as an advertising medium?
A) long lifespan
B) high reproduction quality
C) huge "pass-along" audience
D) high level of targeting
E) good local market coverage

C

29) Which of the following is a disadvantage of using newspapers as an advertising medium?
A) lack of flexibility
B) high costs of advertisement space
C) poor reproduction quality
D) low believability
E) absence of local market coverage

A

30) Which of the following is an advantage of using television as an advertising medium?
A) high attention and reach
B) low absolute cost
C) absence of clutter
D) long duration of ad exposure
E) high audience selectivity

A

31) Which of the following is a disadvantage of using television as an advertising medium?
A) high absolute cost
B) low audience attention
C) lack of reach among audience
D) high audience selectivity
E) absence of clutter

E

32) Which of the following is an advantage of using radio as an advertising medium?
A) higher attention than television
B) standardized rate structures
C) long duration of ad exposure
D) high quality reproduction
E) high geographic selectivity

D

33) Which of the following is a disadvantage of using direct mail as an advertising medium?
A) low audience selectivity
B) lack of flexibility
C) high competition within same medium
D) relatively high cost
E) lack of personalization of advertising message

A

34) Which of the following is an advantage of using magazines as an advertising medium?
A) high-quality reproduction
B) short ad purchase lead time
C) high efficiency in circulation
D) no ad competition in same medium
E) low cost of advertising

B

35) Which of the following is a disadvantage of using magazines as an advertising medium?
A) low geographic and demographic selectivity
B) long ad purchase lead time
C) low-quality reproduction
D) small "pass-along" readership
E) lack of credibility

C

36) Which of the following is a disadvantage of using outdoor media for advertising?
A) low flexibility
B) low repeat exposure
C) limited audience selectivity
D) high costs
E) greater competition

B

37) Which of the following is an advantage of using Yellow Pages as an advertising medium?
A) low competition
B) high believability
C) short ad purchase lead time
D) greater scope for creativity
E) lack of clutter

A

38) Which of the following is a disadvantage of using Yellow Pages as an advertising medium?
A) high competition
B) poor local market coverage
C) low believability
D) lack of adequate reach
E) high total costs

B

39) Which of the following is a disadvantage of using the Internet as an advertising medium?
A) limited audience selectivity
B) increasing clutter
C) lack of interactive possibilities
D) relatively high costs involved
E) fleeting ad exposure time

B

40) Which of the following is a disadvantage of using newsletters as an advertising medium?
A) low audience selectivity
B) high chances of runaway costs
C) lack of adequate control
D) relatively high costs
E) lack of interactive possibilities

C

41) Pepe Homes manufactures a range of bathroom accessories and fittings that include bath-tubs, shower stalls, etc. While deciding on an effective advertising media vehicle for its planned advertising campaign, the marketing department decides that its advertising objectives would be best achieved if they used a medium that would portray their brand as prestigious and a symbol of luxury. To this effect, the medium should offer the marketers a high degree of audience selectivity and high-quality reproduction. Which of the following advertising media would best serve the advertising purposes of Pepe Homes?
A) outdoor media
B) radio
C) magazines
D) television
E) newspapers

A

42) Moonburst is a newly-launched brand of energy drinks, one among many other recently introduced competing brands. The advertising agency handling Moonburst's account decides that to promote Moonburst better, it has to zero in on an advertising medium that would offer immunity from the clutter of other brands, flexibility to alter its advertising message, and fit in with the modest advertising budget. Also, the medium has to provide a high repeat exposure of the advertising message to the target audience. The advertising agency would be happy to trade-off audience selectivity and creative possibilities, if the medium satisfies the above criteria. Which of the following would be the best option for Moonburst?
A) outdoor media
B) radio
C) magazines
D) television
E) Yellow Pages

D

43) Which of the following advertising practices involves advertisers paying filmmakers to have their products make cameo appearances in movies and television shows?
A) brand extension
B) flyposting
C) co-branding
D) product placement
E) ambush marketing

B

44) The popular music talent show, American Idol, has been generally acknowledged as the most profitable TV series in U.S. history, in terms of advertising and merchandising revenue. Major sponsors of the show include Coca-Cola, AT&T Wireless, and iTunes, among many others. Cups bearing the logo of Coca-Cola were a prominent prop found on the show's judges' tables. The show also urged viewers to vote for contestants using AT&T sms services. Contestants were routinely shown rehearsing for their performances with the help of Apple iPods. Which of the following advertising practices is apparent in this example?
A) ambush advertising
B) product placement
C) angel dusting
D) co-branding
E) subliminal advertising

A

45) Which of the following media timing factors expresses the rate at which new customers enter the market?
A) buyer turnover
B) purchase frequency
C) media reach
D) weighted number of exposures
E) advertising impressions

B

46) ________ is the number of times the average buyer buys a product during the period.
A) Buyer turnover
B) Purchase frequency
C) Customer retention rate
D) Advertising impressions
E) Total number of exposures

D

47) In which of the following types of advertising timing patterns do exposures appear evenly throughout a given period?
A) concentration
B) pulsing
C) flighting
D) continuity
E) frequency capping

C

48) Which of the following types of advertising timing patterns calls for spending all the advertising dollars in a single period?
A) frequency capping
B) flighting
C) concentration
D) pulsing
E) continuity

D

49) Ted is a media buyer with Shelvey Partners, an ad agency in San Francisco. He is currently working on charting a media plan for a departmental store chain's ads that are targeted at the upcoming Thanksgiving weekend. Which of the following advertising timing patterns is best suited for running these ads?
A) continuity
B) flighting
C) pulsing
D) concentration
E) frequency capping

C

50) Advertisements for which of the following products categories would merit a continuous advertising timing pattern the most?
A) air conditioners
B) life insurance
C) breakfast cereal
D) automobiles
E) holiday package tours

C

51) ________ is an advertising timing pattern that calls for advertising during a period, followed by a period with no advertising, followed by a second period of advertising activity.
A) Pulsing
B) Continuity
C) Flighting
D) Concentration
E) Frequency capping

C

52) Flighting as an advertising timing pattern is most useful when ________.
A) purchase cycle is rather frequent
B) substantial advertising budget is available
C) items are seasonal
D) tightly defined buyer categories exist
E) there are expanding market situations

E

53) Advertisements for which of the following product categories would be most effective when used with a flighting pattern?
A) breakfast cereal
B) detergents
C) beer
D) electric bulbs
E) refrigerator

C

54) ________ is continuous advertising at low-weight levels, reinforced periodically by waves of heavier activity.
A) Flighting
B) Frequency capping
C) Pulsing
D) Concentration
E) Session capping

A

55) ________ seeks to determine whether an ad is communicating effectively.
A) Copy testing
B) Flighting
C) Pulsing
D) Frequency capping
E) Square inch analysis

C

56) ________ represents the proportion of company advertising of a product to all advertising of that product.
A) Share of wallet
B) Share of mind
C) Share of voice
D) Share of market
E) Share of cost

C

57) Which of the following elements of the marketing communications mix consists of a collection of incentive tools, mostly short-term, designed to stimulate quicker or greater purchase of particular products or services by consumers or the trade?
A) advertising
B) public relations
C) sales promotion
D) events and experiences
E) personal selling

C

58) Which of the following is an example of a trade promotion?
A) free samples
B) discount coupons
C) display allowances
D) contests for sales reps
E) premiums

C

59) Which of the following is an example of a business and sales force promotion?
A) advertising allowance
B) free samples
C) contests for sales reps
D) display allowance
E) discount coupons

C

60) Sales promotion expenditures increased as a percentage of budget expenditure for a number of years, although its growth has recently slowed. Which of the following is a factor that has contributed to the growth of sales promotion expenditures?
A) many brands have come to be seen as dissimilar
B) the efficiency of advertising as a promotion has improved
C) the trade demands more deals from manufacturers
D) consumers have become less price-oriented
E) the number of brands in the market has decreased

D

61) According to consumer-packaged goods companies, which of the following effects is attributed to the heavy use of sales promotion?
A) increased brand loyalty
B) focus on long-run marketing planning
C) improved brand-quality image
D) increased price sensitivity
E) greater coupon redemption rates

D

62) Which of the following is an example of a manufacturer promotion?
A) price cuts
B) feature advertising
C) retailer coupons
D) high-value trade-in credit
E) retailer contests or premiums

E

63) Which of the following is a sales promotion tool that is consumer franchise building in nature?
A) price-off packs
B) contests and sweepstakes
C) consumer refund offers
D) trade allowances
E) frequency awards

A

64) Which of the following is a sales promotion tool that typically does not build brand image?
A) consumer refund offers
B) free samples
C) premiums related to the product
D) frequency awards
E) coupons that include a selling message

D

65) Which of the following consumer promotion tools offers a free amount of a product or service delivered door-to-door, sent in the mail, picked up in a store, attached to another product, or featured in an advertising offer?
A) coupons
B) rebates
C) premiums
D) samples
E) price packs

B

66) ________ are certificates that entitle the bearer to a stated saving on the purchase of a specific product.
A) Samples
B) Coupons
C) Rebates
D) Price packs
E) Premiums

A

67) ________ are consumer promotion tools that provide a price reduction after purchase rather than at the retail shop.
A) Rebates
B) Cents-off deals
C) Price packs
D) Coupons
E) Premiums

C

68) ________ are consumer promotion offers to consumers of savings off the regular price of a product, flagged on the label or package.
A) Coupons
B) Rebates
C) Price packs
D) Premiums
E) Samples

D

69) Premiums, as a consumer promotion tool, are defined as ________.
A) offers to consumers of savings off the regular price of a product, flagged on the label or package
B) certificates entitling the bearer to a stated saving on the purchase of a specific product
C) programs providing rewards related to the consumer's frequency and intensity in purchasing the company's products or services
D) merchandise offered at a relatively low cost or free as an incentive to purchase a particular product
E) values in cash or in other forms that are proportional to patronage of a certain vendor or group of vendors

D

70) ________ is a consumer promotion tool that involves inviting prospective purchasers to try the product without cost in the hope that they will buy.
A) Sampling
B) Premium
C) Cross-promotion
D) Free trial
E) Rebate

D

71) Which of the following consumer promotion tools involves using one brand to advertise another noncompeting brand?
A) tie-in promotion
B) frequency programs
C) specialty advertising
D) cross-promotion
E) patronage awards

A

72) Which of the following consumer promotion tools refers to explicit or implicit promises by sellers that the product will perform as specified or that the seller will fix it or refund the customer's money during a specified period?
A) product warranties
B) coupons
C) free trials
D) rebates
E) patronage awards

E

73) Which of the following terms describes the practice of retailers purchasing a greater quantity during a sales promotion period than they can immediately sell?
A) diverting
B) panic buying
C) straight rebuy
D) buyout
E) forward buying

A

74) Which of the following retailer practices involves buying more units than needed of a product under a sales promotion in a region where the manufacturer offers a promotion deal and shipping the surplus to their stores in nondeal regions?
A) diverting
B) panic buying
C) hoarding
D) stockpiling
E) forward buying

C

75) A ________ is a salesforce promotion tool that aims at inducing the sales force or dealers to increase their sales results over a stated period, with prizes (money, trips, gifts, or points) going to those who succeed.
A) trade show
B) frequency program
C) sales contest
D) sweepstake
E) patronage award

D

76) ________ is the time necessary to prepare a promotional program prior to launching it.
A) Sell-in time
B) Link time
C) Setup time
D) Lead time
E) Hold time

E

77) ________ begins with the promotional launch and ends when approximately 95 percent of the deal merchandise is in the hands of consumers.
A) Lead time
B) Hold time
C) Setup time
D) Link time
E) Sell-in time

B

78) Becoming part of a personally relevant moment in consumers' lives through ________ can broaden and deepen a company or brand's relationship with the target market.
A) advertisements
B) events and experiences
C) sales promotions
D) public relations
E) direct marketing efforts

E

79) Rolex calls itself the "Official Timekeeper" of the Wimbledon and Australian Open lawn tennis championships, by virtue of its sponsorships of the marquee events. What is the most likely objective for Rolex's sponsorship deal with these events?
A) to permit merchandising or promotional opportunities
B) to express commitment to the community or on social issues
C) to create experiences and evoke feelings
D) to identify with a particular target market or lifestyle
E) to increase salience of company or product name

D

80) Mountain Dew is a brand known for sponsorships of adventure events such as snowboarding and skateboarding competitions. What is the most likely objective of Mountain Dew's sponsorship of these events?
A) to enhance corporate image
B) to express commitment to the community or on social issues
C) to entertain key clients or reward key employees
D) to create perceptions of key brand image associations
E) to become part of a personally relevant moment in consumers' lives

C

81) Audi models featured prominently in the 2010 blockbuster Iron Man 2, including main character Tony Stark's personal R8 Spyder. Which of the following is the most rational explanation for Audi's decision to associate itself with the movie?
A) to express commitment to the community or on social issues
B) to identify with a particular target market or lifestyle
C) to create experiences and evoke feelings
D) to become part of a personally relevant moment in consumers' lives
E) to entertain key clients or reward key employees

B

82) JBJ Sports is a leading sports goods maker from Atlanta. It has recently initiated a program in association with the Children of God Foundation, which bids to raise funds to promote nutritional awareness and education of young children from Bangladesh. The company plans to donate $1 for every item it sells in the North American market. Also, JBJ has roped in professional sports teams associated with it to wear the Children of God logo on their team gear. Which of the following best describes the motivation for JBJ's involvement in the program?
A) entertaining key clients or rewarding key employees
B) expressing commitment to the community or on social issues
C) permitting merchandising or promotional opportunities
D) stimulating quicker or greater purchase of particular brands
E) identifying with a particular target market or lifestyle

C

83) Which of the following factors forms the basis of assessing sponsorship activities through supply-side methods?
A) consumers' brand knowledge
B) impact on sponsor's bottom line
C) extent of media coverage
D) brand exposure reported by consumers
E) sales pattern of sponsored products

D

84) Which of the following parameters forms the basis for measuring sponsorship effectiveness using demand-side methods?
A) impact on market share of sponsor
B) amount of time a brand is clearly visible on a television screen
C) amount of relevant newsprint mentioning the sponsor
D) influence on consumers' brand knowledge of the sponsor
E) net impact on the sponsor's bottom line

A

85) ________ is a marketing communications tool that includes a variety of programs to promote or protect a company's image or individual products.
A) Public relations
B) Advertising
C) Sales promotion
D) Personal selling
E) Direct marketing

E

86) Which of the following functions of public relations departments involves presenting news and information about the organization in the most positive light?
A) corporate communications
B) product publicity
C) lobbying
D) counseling
E) press relations

D

87) Which of the following describes the public relations function of lobbying?
A) sponsoring efforts to publicize specific products
B) advising management about public issues, and company positions and image during good times and bad
C) presenting news and information about the organization in the most positive light
D) dealing with legislators and government officials to promote or defeat legislation and regulation
E) promoting understanding of the organization through internal and external communications

B

88) What function does a company's public relations department perform when it promotes understanding of the organization through internal and external communications?
A) lobbying
B) corporate communications
C) press relations
D) product publicity
E) counseling

A

89) When a public relations department of a company advises management about public issues, and company positions and image during good times and bad, it is performing the function of ________.
A) counseling
B) corporate communications
C) product publicity
D) lobbying
E) press relations

D

90) ________ refers to the task of securing editorial space—as opposed to paid space—in print and broadcast media to promote or "hype" a product, service, idea, place, person, or organization.
A) Advertising
B) Media planning
C) Communication design
D) Publicity
E) Copy testing

B

91) Which of the following is a medium of visual identity for a company?
A) annual reports
B) dress codes
C) press releases
D) seminars
E) trade shows

C

92) The easiest measure of marketing public relations effectiveness is ________.
A) the resultant effect on the company's sales figures
B) the effect it has on its market capitalization
C) the number of exposures carried by the media
D) the changes observed in consumers' brand knowledge
E) the impact it has on the company's market share

true

93) An advertising objective is a specific communications task and achievement level to be accomplished with a specific audience in a specific period of time.

false

94) Persuasive advertising aims to create brand awareness and knowledge of new products or new features of existing products.

false

95) Reinforcement advertising aims to stimulate repeat purchase of products and services

false

96) If the product class is mature, then the advertising objective is to convince the market of the brand's superiority.

true

97) Established brands usually are supported with lower advertising budgets, measured as a ratio to sales.

false

98) Brands in highly-differentiated product classes require heavy advertising to establish a unique image.

false

99) Print advertising (newspapers and magazines) is generally acknowledged as the most powerful advertising medium.

true

100) Although newspapers are timely and pervasive, magazines are typically more effective at building user and usage imagery.

true

101) Researchers studying print advertisements report that the picture, headline, and copy matter in that order.

false

102) Puffery refers to simple exaggerations in advertisements that are not meant to be believed and are considered illegal.

true

103) Reach of an advertising message is most important when launching new products, flanker brands, extensions of well-known brands, or infrequently purchased brands.

false

104) The higher the forgetting rate associated with a brand, product category, or message, the lower the warranted level of repetition.

true

105) The rationale behind place advertising is that marketers are better off reaching people where they work, play, and shop.

false

106) Outdoor advertising is more effective at creating new brand associations than enhancing brand awareness or brand image.

false

107) The macroscheduling decision calls for allocating advertising expenditures within a short period to obtain maximum impact.

true

108) The forgetting rate is the rate at which the buyer forgets the brand; the higher the forgetting rate, the more continuous the advertising should be.

true

109) Concentrated advertising is well suited for products with one selling season or related holiday.

false

110) An advertiser makes "local buys" when it buys TV time in just a few markets or in regional editions of magazines.

false

111) Sales promotion consists of a collection of incentive tools designed to mainly stimulate long-term brand associations of products or services with consumers or the trade.

true

112) Sales promotions often attract brand switchers, who are primarily looking for low price, good value, or premiums.

true

113) Sales promotions in markets of high brand similarity can produce a high sales response in the short run but little permanent gain in brand preference over the longer term.

true

114) Incessant price reductions, coupons, deals, and premiums can devalue a product in buyers' minds.

true

115) The historical approach correlates past sales to past advertising expenditures using advanced statistical techniques.

false

116) Loyal brand buyers tend to change their buying patterns as a result of competitive promotions.

true

117) Dominant brands offer sales promotion deals less frequently, because most deals subsidize only current users.

false

118) Examples of manufacturer promotions include price cuts and feature advertising.

true

119) Sales promotion tools that typically are not brand building include price-off packs, contests and sweepstakes, consumer refund offers, and trade allowances.

true

120) Manufacturers handle forward buying and diverting by producing and delivering less than the full order in an effort to smooth production.

true

121) Additional costs beyond the cost of specific promotions include the risk that promotions might decrease long-run brand loyalty.

true

122) An ideal event is also unique but not encumbered with many sponsors, lends itself to ancillary marketing activities, and reflects or enhances the sponsor's brand or corporate image.

false

123) The supply-side method identifies the effect sponsorship has on consumers' brand knowledge.

true

124) Although supply-side exposure methods provide quantifiable measures, equating media coverage with advertising exposure ignores the content of the respective communications.

true

125) Media coverage and telecasts only expose the brand and don't necessarily embellish its meaning in any direct way.

true

126) The supply-side measurement method focuses on potential exposure to the brand by assessing the extent of media coverage, and the demand-side method focuses on exposure reported by consumers.

true

127) A public is any group that has an actual or potential interest in or impact on a company's ability to achieve its objectives.

false

128) The public relations function of lobbying involves advising management about public issues, and company positions and image during good times and bad.

false

129) The main objective of marketing public relations is to secure editorial space in print and broadcast media to promote or "hype" a product, service, idea, place, person, or organization.

true

130) Creative public relations can affect public awareness at a fraction of the cost of advertising.

true

131) MPR can hold down promotion cost because it costs less than direct-mail and media advertising.

false

132) MPR can build credibility by placing stories in the media to bring attention to a product, service, person, organization, or idea.

false

133) MPR is effective in blanketing local communities and reaching specific groups and hence has to be planned separately from the less cost-effective advertising.

false

134) MPR's contribution to a company's bottom line is the easiest to measure among all the available promotion tools.

Answer: (1) Mission—sales goals and advertising objectives; (2) Money—factors to consider: stage in PLC, market share and consumer base, competition and clutter, advertising frequency, and product substitutability; (3) Message—message generation, message evaluation and selection, message execution, and social-responsibility review; (4) Media—reach, frequency, impact, major media types, specific media vehicles, media timing, and geographical media allocation; and (5) Measurement—communication impact and sales impact.

135) In developing an advertising program, marketing managers can make the five major decisions known as the five Ms. List and explain each of these Ms.

Answer: (1) Informative advertising aims to create brand awareness and knowledge of new products or new features of existing products.
(2) Persuasive advertising aims to create liking, preference, conviction, and purchase of a product or service. Some persuasive advertising uses comparative advertising, which makes an explicit comparison of the attributes of two or more brands. Comparative advertising works best when it elicits cognitive and affective motivations simultaneously, and when consumers are processing advertising in a detailed, analytical mode.
(3) Reminder advertising aims to stimulate repeat purchase of products and services.
(4) Reinforcement advertising aims to convince current purchasers that they made the right choice.

136) Explain the classification of advertising objectives.

Answer: The advertising objective should emerge from a thorough analysis of the current marketing situation. If the product class is mature, the company is the market leader, and brand usage is low, the objective is to stimulate more usage. If the product class is new, the company is not the market leader, but the brand is superior to the leader, then the objective is to convince the market of the brand's superiority.

137) Describe how advertising objectives are set to reflect the product class.

Answer:
1. Stage in the product life cycle — New products typically merit large advertising budgets to build awareness and to gain consumer trial. Established brands usually are supported with lower advertising budgets, measured as a ratio to sales.
2. Market share and consumer base — High-market-share brands usually require less advertising expenditure as a percentage of sales to maintain share. To build share by increasing market size requires larger expenditures.
3. Competition and clutter — In a market with a large number of competitors and high advertising spending, a brand must advertise more heavily to be heard. Even simple clutter from advertisements not directly competitive to the brand creates a
need for heavier advertising.
4. Advertising frequency — The number of repetitions needed to put the brand's message across to consumers has an obvious impact on the advertising budget.
5. Product substitutability — Brands in less-differentiated or commodity-like product classes (beer, soft drinks, banks, and airlines) require heavy advertising to establish a unique image.

138) Give a brief description of the various factors that affect advertising budget decisions.

Answer: Television is generally acknowledged as the most powerful advertising medium and reaches a broad spectrum of consumers at low cost per exposure. TV advertising has two particularly important strengths. First, it can vividly demonstrate product attributes and persuasively explain their corresponding consumer benefits. Second, it can dramatically portray user and usage imagery, brand personality, and other intangibles. Because of the fleeting nature of the ad, however, and the distracting creative elements often found in it, product-related messages and the brand itself can be overlooked. Moreover, the high volume of nonprogramming material on television creates clutter that makes it easy for consumers to ignore or forget ads.

139) Write a brief note on the role of television as an advertising medium.

Answer: Print media offer a stark contrast to broadcast media. Because readers consume them at their own pace, magazines and newspapers can provide detailed product information and effectively communicate user and usage imagery. At the same time, the static nature of the visual images in print media makes dynamic presentations or demonstrations difficult, and print media can be fairly passive.

The two main print media—magazines and newspapers—share many advantages and disadvantages. Although newspapers are timely and pervasive, magazines are typically more effective at building user and usage imagery. Newspapers are popular for local—especially retailer—advertising. Although advertisers have some flexibility in designing and placing newspaper ads, relatively poor reproduction quality and short shelf life can diminish the ads' impact.

140) What is the role of print media in advertising? What are the major advantages and disadvantages associated with print advertising media?

Answer: To break through clutter, some advertisers believe they have to be edgy and push the boundaries of what consumers are used to seeing in advertising. In doing so, marketers must be sure advertising does not overstep social and legal norms or offend the general public, ethnic groups, racial minorities, or special-interest groups.

A substantial body of laws and regulations governs advertising. Under U.S. law, advertisers must not make false claims, such as stating that a product cures something when it does not. They must avoid false demonstrations, such as using sand-covered Plexiglas instead of sandpaper to demonstrate that a razor blade can shave sandpaper. It is illegal in the United States to create ads that have the capacity to deceive, even though no one may actually be deceived. The challenge is telling the difference between deception and "puffery"—simple exaggerations that are not meant to be believed and that are permitted by law.

Sellers in the United States are legally obligated to avoid bait-and-switch advertising that attracts buyers under false pretenses. Advertising can play a more positive broader social role. The Ad Council is a nonprofit organization that uses top-notch industry talent to produce and distribute public service announcements for nonprofits and government agencies. From its early origins with "Buy War Bonds" posters, the Ad Council has tackled innumerable pressing social issues through the years. One of its recent efforts featured beloved Sesame Street stars Elmo and Gordon exhorting children to wash their hands in the face of the H1N1 flu virus.

141) What are the legal and social issues associated with advertising?

Answer: Marketers need to apply several adjustments to the cost-per-thousand measure.
First, they should adjust for audience quality. For a baby lotion ad, a magazine read by 1 million young mothers has an exposure value of 1 million; if read by 1 million teenagers, it has an exposure value of almost zero.
Second, adjust the exposure value for the audience-attention probability. Readers of Vogue may pay more attention to ads than do readers of Newsweek.
Third, adjust for the medium's editorial quality (prestige and believability). People are more likely to believe a TV or radio ad and to become more positively disposed toward the brand when the ad is placed within a program they like.
Fourth, consider ad placement policies and extra services (such as regional or occupational editions and lead-time requirements for magazines).

142) What are the adjustments that marketers need to apply to the cost-per thousand measure when selecting specific media vehicles?

Answer: Student answers may vary.
The advertiser needs to apply several adjustments to the cost-per-thousand measure. First, they should adjust for audience quality. The product being high-end laptops, it is better advertised in a magazine read by 1 million college-going kids rather than 2 million housewives, in which case it would have an exposure value of almost zero. Second, the exposure value for the audience-attention probability must be accounted for. Readers of Chip or Digit may pay more attention to gadget ads than do readers of Newsweek. Third, the medium's editorial quality (prestige and believability) should be considered. People are more likely to believe a TV or radio ad and to become more positively disposed toward the brand when the ad is placed within a program they like. To this effect, the ads can be placed within a program like Big Bang Theory. The fourth adjustment should be made in relation to ad placement policies and extra services (such as regional or occupational editions and lead-time requirements for magazines). Laptop ads would be better received and responded in magazines that have greater circulation in urban areas with an office-going population or university towns with sizable student populations.

143) Describe the adjustments that a advertiser of high-end laptops has to make to the cost-per-thousand measure.

Answer: In launching a new product, the advertiser must choose among continuity, concentration, flighting, and pulsing.
• Continuity means exposures appear evenly throughout a given period. Generally, advertisers use continuous advertising in expanding market situations, with frequently purchased items, and in tightly defined buyer categories.
• Concentration calls for spending all the advertising dollars in a single period. This makes sense for products with one selling season or related holiday.
• Flighting calls for advertising during a period, followed by a period with no advertising, followed by a second period of advertising activity. It is useful when funding is limited, the purchase cycle is relatively infrequent, or items are seasonal.
• Pulsing is continuous advertising at low-weight levels, reinforced periodically by waves of heavier activity. It draws on the strength of continuous advertising and flights to create a compromise scheduling strategy. Those who favor pulsing believe the audience will learn the message more thoroughly, and at a lower cost to the firm.

144) What are the four types of advertising timing patterns available to marketers when launching a new product?

Answer: Communication-effect research, called copy testing, seeks to determine whether an ad is communicating effectively. Marketers should perform this test both before an ad is put into media and after it is printed or broadcast. Pretest critics maintain that agencies can design ads that test well but may not necessarily perform well in the marketplace. Proponents maintain that useful diagnostic information can emerge and that pretests should not be used as the sole decision criterion anyway. Many advertisers use posttests to assess the overall impact of a completed campaign. If a company hoped to increase brand awareness from 20 percent to 50 percent and succeeded in increasing it to only 30 percent, then the company is not spending enough, its ads are poor, or it has overlooked some other factor.

145) Describe the communication-effect research method of evaluating advertising effectiveness.

Answer: Sales promotion expenditures increased as a percentage of budget expenditure for a number of years, although its growth has recently slowed. Several factors contributed to this growth, particularly in consumer markets. Promotion became more accepted by top management as an effective sales tool, the number of brands increased, competitors used promotions frequently, many brands were seen as similar, consumers became more price-oriented, the trade demanded more deals from manufacturers, and advertising efficiency declined. But the rapid growth of sales promotion created clutter. Loyal brand buyers tend not to change their buying patterns as a result of competitive promotions. Advertising appears to be more effective at deepening brand loyalty, although we can distinguish added-value promotions from price promotions. Price promotions may not build permanent total-category volume. Small-share competitors may find it advantageous to use sales promotion, because they cannot afford to match the market leaders' large advertising budgets, nor can they obtain shelf space without offering trade allowances or stimulate consumer trial without offering incentives. Dominant brands offer deals less frequently, because most deals subsidize only current users.

146) Compare and contrast advertising and sales promotion as marketing communication tools.

Answer: The growing power of large retailers has increased their ability to demand trade promotion at the expense of consumer promotion and advertising. The company's sales force and its brand managers are often at odds over trade promotion. The sales force says local retailers will not keep the company's products on the shelf unless they receive more trade promotion money, whereas brand managers want to spend their limited funds on consumer promotion and advertising.

Manufacturers face several challenges in managing trade promotions. First, they often find it difficult to police retailers to make sure they are doing what they agreed to do. Manufacturers increasingly insist on proof of performance before paying any allowances. Second, some retailers are doing forward buying—that is, buying a greater quantity during the deal period than they can immediately sell. Retailers might respond to a 10 percent-off-case allowance by buying a 12-week or longer supply. The manufacturer must then schedule more production than planned and bear the costs of extra work shifts and overtime. Third, some retailers are diverting, buying more cases than needed in a region where the manufacturer offers a deal and shipping the surplus to their stores in nondeal regions. Manufacturers handle forward buying and diverting by limiting the amount they will sell at a discount, or by producing and delivering less than the full order in an effort to smooth production. Ultimately, many manufacturers feel trade promotion has become a nightmare. It contains layers of deals, is complex to administer, and often leads to lost revenues.

147) What challenges do marketers face in managing trade promotions?

Answer: 1. To identify with a particular target market or lifestyle
2. To increase salience of company or product name
3. To create or reinforce perceptions of key brand image associations
4. To enhance corporate image
5. To create experiences and evoke feelings
6. To express commitment to the community or on social issues
7. To entertain key clients or reward key employees
8. To permit merchandising or promotional opportunities

148) List the major objectives of events and experiences as promotion tools.

Answer: It's a challenge to measure the success of events. The supply-side measurement method focuses on potential exposure to the brand by assessing the extent of media coverage, and the demand-side method focuses on exposure reported by consumers.

Supply-side methods approximate the amount of time or space devoted to media coverage of an event, for example, the number of seconds the brand is clearly visible on a television screen or the column inches of press clippings that mention it. These potential "impressions" translate into a value equivalent to the dollar cost of actually advertising in the particular media vehicle. Although supply-side exposure methods provide quantifiable measures, equating media coverage with advertising exposure ignores the content of the respective communications. The advertiser uses media space and time to communicate a strategically designed message. Media coverage and telecasts only expose the brand and don't necessarily embellish its meaning in any direct way. Although some public relations professionals maintain that positive editorial coverage can be worth 5 to 10 times the equivalent advertising value, sponsorship rarely provides such favorable treatment.

The demand-side method identifies the effect sponsorship has on consumers' brand knowledge. Marketers can survey event spectators to measure recall of the event as well as resulting attitudes and intentions toward the sponsor.

149) Describe the methods used to measure sponsorship activities.

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