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Marketing management midterm 2

Terms in this set (31)

Andrea's Kitchen is a catering business that operates by means of its own website. Customers order party platters, pastries, and other foods that the company makes to order. The items are then vacuum-packed in dry ice and shipped to the customer's address via overnight delivery. Andrea's Kitchen is part of a(n)

A. indirect channel.
B. dual channel.
C. intermediary channel.
D. direct channel.
E. traditional channel.
Answer: direct channel

Feedback: Web-based e-commerce systems give many firms direct access to customers. This website allows customers to place orders and provide information so that Andrea's Kitchen can ship directly to them. Andrea's Kitchen is an example of a direct channel. The best answer selection is 'D'.
Dave Tindall runs "Maid to Perfection," a residential and business cleaning service. He paid a fee to be part of the "Maid to Perfection" system of local operators. The written agreement gives him the right to use the company name and operations manual, and the agreement promises Dave that there will not be another "Maid to Perfection" operator in his immediate area. He operates as a semi-independent entrepreneur, but is still part of a national organization. Dave is part of a(n)
A. traditional channel.
B. contractual channel.
C. corporate channel.
D. administered channel.
E. dual channel.
Answer: contractual channel

Feedback: In contractual channel systems, channel members agree by contract to cooperate with each other. Dave owns a franchise of "Maid to Perfection." Most franchise systems are examples of contractual channels. The best answer selection is 'B'.
Chocolate Dreams is a manufacturer of expensive, high-quality, hand-made "old style" candies that are sold through fine department stores and certain bookstores and fine gift shops. The ideal market exposure for products manufactured by Chocolate Dreams is
A. intensive.
B. comprehensive.
C. exclusive.
D. extensive.
E. selective.
Answer: selective.

Feedback: Selective distribution is selling through only those intermediaries who will give the product special attention. Companies commonly use selective distribution to gain some of the advantages of exclusive distribution—while still achieving fairly widespread market coverage. Chocolate Dreams is using selective distribution. The best answer selection is 'E'.
A manufacturer of accessories for personal computers evaluates all the alternative systems by combining order processing, transportation, inventory management, and storage. If the total cost approach is followed, which physical distribution system should the manufacturer select?

A. The one that maximizes customer service at the highest total cost.
B. The one that maximizes customer service at the lowest total cost.
C. The one that meets the customer service requirement at the lowest total cost.
D. The one that meets the customer service requirement and minimizes transportation cost.
E. The one that maximizes customer service and minimizes the cost of each individual component of physical distribution.
Answer: C, The one that meets the customer service requirement at the lowest total cost.

Feedback: When using the total cost approach, all of the costs—including transportation, inventory, packing, and damage—are identified and considered for each possible PD system. The goal in this approach would be to meet customer service needs at the lowest total cost. The best answer selection is 'C'.
The best transportation alternative for shipping chickens from farms in West Virginia to processing plants in Maryland would be
A. air.
B. truck.
C. rail.
D. water.
E. none of the above.
Answer: truck.

Feedback: It is important to get the chickens from the farm to the processing plant quickly. Additionally, the area to be covered between West Virginia and Maryland is quite short. Therefore, trucking the chickens would be the best transportation option. Answer 'B' is the best choice.
Parties R Us is a large store containing nothing but party supplies. The store carries everything from costumes to party favors, decorations to invitations, and paper plates to birthday candles. The selection is huge and prices are low. There is even a party consultant on hand to help plan parties. Parties R Us is a

A. department store.
B. catalog retailer.
C. category killer.
D. convenience store.
Answer: category killer.

Feedback:Single-line mass-merchandisers carry a large assortment of products at low prices in a specific product category. These stores are called category killers because it's hard for less specialized retailers to compete. "Parties R Us" is an example of this type of retailer. The best answer selection is 'C'.
Walgreen's, CVS, and other "drugstores" have become scaled-down versions of mass-merchandisers by adding small appliances, housewares, food, and other items to their traditional lines. This type of "scrambled merchandising" is meant to deal with the increasing desire that consumers have for

A. personal service.
B. convenience.
C. low prices.
D. prestigious brand names.
E. quality.
Answer: B, convenience

Feedback: Scrambled merchandising is the term to describe retailers carrying any product lines that they think they can sell profitably. The consumer desire for convenience is driving this approach. The best answer selection is 'B'.
Atlantic Music distributes various types of musical instruments, sheet music, and accessories that are sold through independent music stores. It carries many different brands, such as Remo and Ludwig drums, and brass instruments from Yamaha, Hohner, and other manufacturers. Atlantic takes title to the musical instruments and supplies it resells, and provides a wide variety of services to its customers. Atlantic Music is a(n)
A. merchant wholesaler.
B. limited service merchant wholesaler.
C. auction company.
D. manufacturer's broker.
E. intermediary.
A. merchant wholesaler.

Feedback: Merchant wholesalers own the products they sell and they often specialize by certain types of products. Atlantic Music is an example of a merchant wholesaler. The best answer selection is 'A'.
Target's "Cherokee" brand of men's clothing is available only at Target stores. The brand provides a low-cost alternative to other men's fashions available at department stores and via catalogs. The Cherokee brand is a(n):

A. manufacturer brand
B. dealer brand
C. licensed brand
D. national brand
E. generic brand
dealer brand
non-recognition of the brand name of a firm's product is likely to be least important for:

A. service guarantee
B. be trendy
C. homogeneous sopping product
D. coal
coal
if members of the target market for an apple iPad do not initially recognize the brand name, but compelling advertising results in more members remembering the brand, we say the apple iPad has achieved:
A. brand recognition
B. service guarantee
C. dealer brand
D. homogeneous sopping product
brand recognition
Heinz has a new ketchup bottle that has the cap on the bottom, instead of the top. the bottle uses gravity to help the consumer get every last drop of ketchup out of the bottle. the cap is also designed to pour cleanly, so that dried ketchup does not accumulate around the opening. this new bottle demonstrates how packaging can:

A. promote product
B. protect the product
C. lower distribution costs
D. incorporate UP costs
E. enhance product usage
enhance product usage
Mcdonald's announced that at select locations, if drive through customers do not get exactly what they want within two minutes of placing the order, their next meal will be free. this promise by McDonalds is an example of:

A. brand recognition
B. homogeneous sopping product
C. enhance product usage
D. service guarantee
service guarantee
Jack White wanted to purchase a new dress shirt. he went to a local department store, toured the men's department, and thought all the brands looked about the same. he decided to buy the store brand shirt, because it was the cheapest. for jack, the new shirt was a:

A. convenience product
B. heterogeneous shopping product
C. specially product
D. homogeneous shopping product
E. impulse product
homogeneous shopping product
characteristics of a good brand name include all of the following except:
A. be trendy
B. service guarantee
C. dealer brand
D. coal
be trendy
Kodak announced that it would no longer produce 35 millimeter film cameras, but would manufacture digital cameras exclusively. Sales of digital cameras have grown steadily and have far outpaced the sale of 35 mm cameras in recent years, even among professional photographers. Kodak's decision indicates that 35 mm cameras are probably in the ________ stage of the product life cycle.

A. Market introduction
B. Market growth
C. Sales decline
D. Market maturity
C, Sales decline
Top management of a large company recently approached the dean of a major business school about starting a specialized MBA program for the company's employees. After further discussions, the dean decided that the program did not fit well with the objectives and resources of the school, so the program was put on the "back burner" until conditions changed. The proposed MBA program was at what stage of the new-product development process when it was shelved?

A. Idea generation
B. Screening
C. Idea evaluation
D. Development
E. Commercialization
B, Screening
Which of the following statements about new-product development are true?

A. The process should be informal to encourage innovation.
B. The greatest number of product ideas is in the idea evaluation stage.
C. The best criteria for evaluating new product ideas in the early stages is return on investment (ROI).
D. The process should have top management support.
E. All of the above statements are true.
D and A

The process should have top management support.

The process should be informal to encourage innovation.
Ron Popeil has been a pioneer in the use of direct-response television "infomercials." Over the years his infomercials have promoted many products, including the Showtime Rotisserie Barbecue, a food dehydrating machine, and the world-famous "Veg-O-Matic." The chief advantage of the infomercial is that it provides plenty of time to describe and demonstrate a product's benefits in detail. The choice of the infomercial is related mainly to the _________ element of the communication process.

A. message channel
B. encoding
C. decoding
D. feedback
E. noise
B. encoding
Fido, Inc. is a producer of dog food and is getting ready to introduce a new brand. The firm's marketing research department learns that a competitor is planning to launch another brand about two weeks after Fido's launch. Fido's marketing department quickly mails a set of dated coupons to several thousand consumers in a purchased database of dog owners, encouraging them to ask for the new Fido brand in their favorite store and to stock up on the new brand using the coupons. This is an example of:

A. pulling
B. noise
C. pushing
D. encoding
E decoding.
A. pulling
Julie Jones works for an investment firm. She calls on potential clients, introduces them to her firm, develops goodwill, and tries to set up contacts between customers and her firm's account managers. Julie does not manage any accounts herself, but is using her current position as a training opportunity in hopes of moving up to an account manager position. Julie's current position is that of a:

A. order taker
B. order getter
C. missionary salesperson
D. sales manager
E. systems seller
C. missionary salesperson
After spending two years in the insurance business, Anne McCauley decided to go to graduate school so that she could become qualified to teach high school English. Even though she had a reasonable amount of success in selling insurance, she could not deal with the variability in her income from month to month. She said, "In some months I earn all the money I need in a couple of days. In other months, I can work hard all month long and earn nothing." She wanted a career with more regular earnings. It sounds as though Anne was on a _________ compensation plan in the insurance business.

A. straight commission
B. straight salary
C. combination
D. cost-plus
A. straight commission
A seller of asset-management services specializes in marketing his services to people connected with the publishing business, such as authors, book distributors, and bookstore owners. He often gets leads by scanning newspapers and magazines, looking for new authors whose books are favorably reviewed. This searching takes place in the _________ stage of the personal selling process.

A. follow-up
B. sales presentation
C. closing
D. prospecting
E. prequalification
D. prospecting
Light-the-Way, Inc. sells standard household items such as cleaners, trash bags, and light bulbs via telemarketing. The products are made or packaged by people who are visually impaired. The company donates a percentage of its sales revenue to organizations that provide services to the blind. The telephone sales presentation emphasizes this fact and the quality of the merchandise. The salesperson making the calls reads the same sales script to every potential customer who is called. The only opportunity for the customer to talk comes when the salesperson attempts to close the sale. This is an example of a(n):

A. consultative selling approach
B. selling formula approach
C. prospecting approach
D. systems selling approach
E. prepared sales presentation
E. prepared sales presentation
A television ad for Target encourages consumers to go to their nearest Target store for a big end-of-season sale coming up in two weeks. This type of advertising is:

A. pioneering
B. reminder
C. indirect competitive
D. direct competitive
E. institutional
B. reminder
Community Bank sends an advertisement via direct mail to several thousand customers, quoting special low financing rates on new vehicles for a limited time only. The ad names some other financial institutions and shows their respective loan rates. Community Bank promises to beat any rate offered for a comparable term. This type of advertising is:

A. pioneering
B. indirect competitive
C. comparative
D. reminder
E. institutional.
C. comparative
A famous athlete is featured in a commercial for a pain-relieving rub that can help soothe muscle aches and pains. He says, "If it works for me, it'll surely work for you." This testimonial is mainly aimed at the _________ stage of the AIDA model.

A. attention
B. interest
C. desire
D. action
E. confirmation
D. action
An industry-leading high technology company just announced that it was cutting its prices and would price its products at whatever level was necessary to protect its market share. This is evidence of a ____________ pricing objective.

A. target return
B. status quo-oriented
C. profit maximization
D. sales-oriented
E. non-price competition
D. sales-oriented
A construction company is considering purchasing a new crane from a distributor of such equipment. The distributor offers to provide the construction company with a few thousand dollars worth of credit on an old crane that the company would like to replace. This credit offered by the distributor is a:

A. trade-in- allowance
B. sale price
C. seasonal discount
D. trade discount
E. cash discount.
A. trade-in- allowance
Janet Eckerd wants to buy a new Volvo. She lives in Richmond, Virginia, but can't find the exact color and model she wants at her local Volvo dealers. She searches the Web and discovers that a dealership 90 minutes away, in Alexandria, Virginia, has the car she wants. She called the dealer and found that the price of the vehicle is the same as it would be in Richmond, although the Alexandria dealer wants to charge Janet an additional $150 to have someone drive the car from Alexandria to Janet's home in Richmond. As Janet was about to reject the offer and hang up the phone, the dealer offered to waive the extra "shipping charge" and make the price exactly equal to the price in Richmond. This geographic pricing tactic by the Alexandria dealer is a form of:

A. F.O.B. pricing
B. zone pricing
C. uniform delivered pricing
D. intermediary pricing
E. freight absorption pricing
C. uniform delivered pricing
The simplest geographic pricing policy for a seller to administer is:

A. uniform delivered pricing
B. F.O.B. pricing
C. zone pricing
D. freight absorption pricing
E. life cycle pricing
B. F.O.B. pricing
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