Marketing Channels Exam 3 - Flashcards

Q: Which of the following areas is not one found by research to be appropriate for study in a marketing channel audit?

Customer\'s satisfaction with new products being introduced

question

The term securing the cooperation of channel members suggests that:

answer

Administrative actions by the channel manager are necessary to develop channel member cooperation.

question

At the beginning stage of managing the marketing channel, it is assumed that:

answer

The channel design decision process has already taken place.

question

Before the channel manager can successfully motivate the channel members, he or she must:

answer

Attempt to learn about channel member needs and problems.

question

When securing the cooperation of channel members, the channel manager is:

answer

Motivating channel members.

question

Which of the following is not one of McVey's propositions about the behavior of intermediaries?

answer

The intermediary is a link in a chain forged by the manufacturer.

question

McVey's propositions imply that manufacturers:

answer

Are unaware of or insensitive to the needs and problems of channel members.

question

In a marketing channel communication system, indirect-flow information media include all of the following except:

answer

Product catalogs.

question

All of the following are direct-flow information media in a channel communication system except:

answer

Trade journals.

question

Marketing channel communications systems:

answer

Often need to be supplemented by other approaches for learning channel members' needs and problems.

question

According to the text, research studies dealing with channel members conducted by the manufacturer are:

answer

Relatively rare.

question

Which of the following is not one of the methods suggested for learning about channel member needs and problems?

answer

Channel inspection tours

question

Some producers use outside marketing research firms to learn about channel members' needs and wants because:

answer

a higher degree of objectivity is likely.

question

Anheuser-Busch's "100 percent share of mind" program is most consistent with beer distributors:

answer

Following an exclusive dealing arrangement.

question

A periodic gathering of data on how channel members perceive the manufacturer's marketing program, its component parts, where the relationships are strong and weak, and what is expected of the manufacturer to make the channel relationship viable and optimal, is known as:

answer

A marketing channel audit.

question

Which of the following areas is not one found by research to be appropriate for study in a marketing channel audit?

answer

Customer's satisfaction with new products being introduced

question

Which of the following is a false statement about marketing channel audits?

answer

Audits aid manufacturers in determining what problems have already been solved.

question

Clayton Products, Inc. is considering establishing a Distributor Advisory Council. It can expect that this council will provide all of the following advantages except:

answer

Be quite simple to set up and require little ongoing management.

question

Which of the following is not typically mentioned as an advantage of distributor advisory councils?

answer

They enable channel members to engage in price maintenance.

question

The most sophisticated approach to providing channel member support is the:

answer

distribution programming approach.

question

A basic tenet of virtually all programs of channel member support should be:

answer

That they emphasize the specific needs and problems of the channel members.

question

Which of the following represents a ranking of channel member support programs from the least comprehensive to the most comprehensive?

answer

Cooperative, partnership, distribution programming

question

All of the following are cooperative programs usually aimed at retailers except:

answer

Training salespeople.

question

Cooperative programs must be offered on a proportionally equal basis to all channel members in the same class or they violate the:

answer

Robinson-Patman Act.

question

In general, a good cooperative program has all of the following components except:

answer

It does not need to include retail channel members.

question

Typically, __________ programs are on-again/off-again while __________ programs stress a continuing relationship.

answer

cooperative; strategic alliance

question

Webster's phases in the development of a partnership arrangement include:

answer

A statement of each partner's specific tasks and role in the partnership.

question

With inter-firm relationships, channel members become strategically integrated because they:

answer

Have an explicit and acknowledged stake in the other's success.

question

___________ is the term used to describe strategic alliances that are formed as a part of an Internet strategy.

answer

E-alliances

question

Which of the following is not an issue that needs to be addressed in e-alliances?

answer

Gathering information about alliance members' operations

question

Wal-Mart stays in touch with Procter & Gamble by all of the following except:

answer

Daily meetings between managers of both companies.

question

The partnership approach as applied to the marketing channel means a:

answer

Supportive relationship between channel members based on a careful delineation of their mutual roles in the channel.

question

A partnership in the context of marketing channels is __________ legal partnership.

answer

not related to a

question

The relationships between Procter & Gamble and Wal-Mart, Black & Decker and its distributors, and Rust-Oleum and its distributors all are examples of:

answer

Strategic alliances.

question

Distribution programming may be defined as:

answer

A comprehensive program for the promotion of a product through the channel.

question

The first step in developing a distribution program is an analysis by the manufacturer of __________ and the level of support the manufacturer needs from channel members.

answer

marketing objectives

question

Distribution programming is the __________ form of channel member support.

answer

most comprehensive

question

Ethan Allen Interiors Inc., cited in the text, best illustrates the _____________ approach to motivating channel members.

answer

distribution programming approach

question

Virtually all of the policy options for developing a distribution programming arrangement can be categorized into the following three major groups:

answer

Price concessions, financial assistance, and protection.

question

Consignment selling, liberal returns allowances, and rebate provisions are examples of __________ in a distribution programming arrangement.

answer

protective provisions

question

A detailed statement covering the manufacturer's policies in most of the relevant areas of its relationship with channel members is referred to as a:

answer

Programmed merchandising agreement.

question

A typical Programmed Merchandising Agreement contains all of the following major categories except:

answer

Capital requirement plan.

question

A distribution programming approach to motivating channel members means:

answer

A comprehensive set of policies for the promotion of product through the channel.

question

In the context of the marketing channel, control may be defined as:

answer

The ability to predict events or to achieve a desired outcome.

question

The underlying basis of all attempts to provide leadership in the channel is:

answer

Power.

question

In the context of the marketing channel, leadership may be defined as:

answer

The use of power to achieve control.

question

Which of the following factors tend to limit the channel manager's attempt to gain total control of the channel?

answer

The lack of central direction

question

The Cisco Systems' example cited in the textbook showed that Cisco:

answer

Used training and certification of dealers to lead in the channel.

question

Amazon.com has begun to pressure manufacturers to use less wasteful packaging because:

answer

Having a large advertising budget.

question

To a channel manager, the elements of the marketing mix do all of the following except:

answer

They do not affect the performance of other channel members.

question

The channel manager's efforts to manage the marketing channels effectively should focus on:

answer

Creating synergy among the four components of the marketing mix.

question

For the channel manager, the most powerful element of the marketing mix for gaining channel member cooperation is:

answer

It varies.

question

Product decisions __________ channel management decisions.

answer

Affect

question

Which of the following is a false statement about when a manufacturer is developing new products and involvement of channel members?

answer

Channel members should have experts at the manufacturer's plant during product development.

question

K&B Manufacturing, in developing its new products, must recognize that its intermediaries will judge the acceptability of the new products based on:

answer

The product's profit potential in terms of meeting established margin structures.

question

Large supermarkets have selected small food manufacturers to provide natural food items for their stores because:

answer

Of the small manufacturer's credibility.

question

Acceptance of a new product by channel members __________ its acceptance by final users.

answer

is necessary for

question

Bruce Computer Software, in developing its new products, must recognize that its intermediaries will be enthusiastic only if the new products:

answer

Complement the intermediaries' current assortment.

question

Consumer product companies launch more than 45,000 products each year. Yet, just over _______ maintain distribution for more than two years.

answer

25%

question

Channel members judge a product package based on how well it meets their __________ requirements.

answer

stock and display

question

Manufacturers have to exert a lot of effort to gain channel member acceptance of new products because of all the following except:

answer

Manufacturers are experts in identifying what customers want.

question

The particular mix of products carried by a channel member at the wholesale or retail level is referred to in the text as its:

answer

Assortment

question

Training for channel members to sell new products successfully:

answer

Should be planned as the new product is being developed.

question

Which of the following was a major problem for Jaguar dealers when Ford introduced the X-Type Jaguar?

answer

Ford was careless about quality, which resulted in higher warranty costs.

question

Which of the following is not a stage of the product life cycle?

answer

Advanced

question

One of the most critical channel management tasks during the introductory stage of the product life cycle is to:

answer

Obtain adequate market coverage.

question

During the growth stage of the product life cycle, two overriding issues for channel management are:

answer

Monitoring competitive products and providing for adequate product availability.

question

During the __________ stage of the product life cycle, manufacturers must be especially mindful of channel member actions with respect to competitive products.

answer

growth

question

The major strategic emphasis for channel managers to make possible changes to the channel structure or to select different types of intermediaries occurs in the _______ product life cycle stage.

answer

Maturity

question

When the maturity stage of the product life cycle is reached, the sales turnover experienced by many of the channel members for the product in question is likely to:

answer

Decrease.

question

It is fair to say that many retailers have become ___________ about the profitability of the barrage of new products offered to them.

answer

hyperskeptical, even cynical

question

A fundamental but long-term strategic channel management option that should be considered during the maturity stage of the product life cycle is:

answer

A change in the channel structure.

question

Special trade deals can keep a channel member attracted to a product in the maturity stage of the product life cycle, but they may not be in the manufacturer's long-run interest because:

answer

They are stopgap measures.

question

During the decline stage of the product life cycle, it is not unusual to find all of the following except:

answer

Increased profit margins.

question

Perhaps the best way for a manufacturer to find out how his products are selling relative to competitive products is:

answer

By monitoring the flow of products at the point of final sale.

question

A product differentiation strategy includes all of the following except:

answer

Gross profit margins will increase through the life of the product.

question

Which of the following would not be considered a differentiated product?

answer

Bic pens

question

A product positioning strategy includes all of the following except:

answer

The cost to manufacture the product.

question

The main channel management issue in product line expansion and contraction strategies is:

answer

Trying to gain channel member support for reshaped product lines.

question

Product line expansion and contraction is becoming even more challenging for channel managers because:

answer

Power retailers are emphasizing store-by-store category management.

question

When pursuing a trading up or trading down product strategy, the most critical issue a channel manager must consider whether:

answer

Whether existing channel members provide adequate market coverage of the high or low end of the market.

question

When Levi Strauss Co. introduced its Levi Strauss Signature brand jeans, it was engaging in a(n) __________ strategy.

answer

trading down

question

A manufacturer risks creating its own competition when it adopts a product strategy of:

answer

National and private brands.

question

When dealing with product brand strategy, the most difficult channel management issues arise in connection with:

answer

Selling products under both national and private brands.

question

Treating post-sales service as an afterthought is a shortcoming in:

answer

Channel management.

question

Product service:

answer

Should be considered as an important strategic issue.

question

The success of a manufacturer's product strategies is:

answer

Often related to channel management.

question

Pricing in the marketing channel can be thought of as analogous to:

answer

Who gets what "piece of the pie".

question

If a product has a list price of $25 and offers a wholesale trade discount of 59% and a retail trade discount of 40%, the cost to the wholesaler is:

answer

$10.25.

question

If a wholesaler can buy an item for $38 that has a list price of $95, the trade discount percentage available to the wholesaler is:

answer

60%.

question

If an item that had cost the retailer $7 sold at retail for $12.50, the gross margin percentage on selling price is:

answer

44%.

question

A product cost a wholesaler $6.80. The wholesaler sold the product to a retailer for $10.00. The percentage gross profit on the wholesaler's cost is:

answer

47%.

question

An item cost a manufacturer $4 to produce. It has a wholesale trade discount of 66% and a retail trade discount of 50%. The list price of the item is $15. Assuming the retailer sold the item for $12, the dollar gross margins received by the manufacturer, wholesaler, and retailer are respectively:

answer

$1.10, $2.40, $4.50.

question

An item cost $20 to produce. The retailer sold the product for $79. It had cost the retailer $50. The wholesaler had paid $34 for the product. The list price of the product was $100. The total of the dollar gross margins received by the manufacturer, wholesaler, and retailer amounts to:

answer

$59.

question

As a general rule, each channel participant wants a price that provides a __________ sufficient to cover its __________ and provide a contribution to __________.

answer

gross margin; expenses; profit

question

Gross margins for retailers of __________ are on the average lower than for retailers of ___________.

answer

Gasoline service stations; furniture

question

Which of the following is most likely to have the effect of moving price points downward for a product category?

answer

Advancing technology

question

Gross margins of wholesalers range approximately from:

answer

7% to 34%.

question

Which of the following is not a potential reaction by channel managers to a manufacturer's cut in price?

answer

The price cut may decrease sales volume and profits.

question

Which of the following is not a factor that should normally be included in developing pricing strategies?

answer

Consumer income

question

Trade discounts:

answer

Are reductions from list price.

question

The "golden rule" of channel pricing advises channel managers to:

answer

Give explicit consideration to the effect of pricing decisions on channel member behavior.

question

Which of the following is a possible channel member reaction to a manufacturer-initiated price cut?

answer

They may resent the reduction in their margins that may result from the price cut.

question

The concept of "buying distribution" refers to:

answer

Paying channel members for services through the margins offered by the manufacturer.

question

When channel members load up on discounted products featured in the manufacturer's promotion but pass on the lower price for just a portion of the amount purchased to their customers, they are most likely to be engaged in:

answer

Forward buying.

question

The "price" paid to gain channel member support must emphasize:

answer

The job performed by the channel members.

question

Ideally, the channel manager should set the margins offered the channel members:

answer

So that margins would vary in direct proportion to the functions performed by the different classes of channel members.

question

Which of the following is true regarding manufacturers' attempt to uncover channel members' views on the manufacturer's pricing strategies?

answer

All of the above

question

Which of the following is a false statement about Oxenfeldt's set of eight classic guidelines for developing pricing strategies?

answer

They guarantee results.

question

If a powerful manufacturer, an industry leader with exceptionally strong brand loyalty from final customers, offers channel members margins they perceive to be inadequate, the channel members are likely to do all of the following except:

answer

Immediately drop the product from their product line.

question

When reviewing the margins offered to different classes of channel members, the channel manager should consider all of the following functions except:

answer

Does the channel member offer guarantees and repair warranties?

question

Giant retail chains such as Home Depot and Lowe's, demand lower prices from manufacturers because:

answer

They perform many wholesaler functions.

question

Household appliance retailers earn an average 33.5% gross margin. These retailers might be willing to accept a lower margin on promotional products if:

answer

The channel members are convinced that the promotional products will help build customer patronage.

question

Which of the following statement pertaining to "special pricing deals" is false?

answer

Generally special pricing deals enhance brand equity.

question

___________ are products that usually have the lowest price in the product line and yield low margins.

answer

Door openers

question

For some product categories, customers simply have come to expect finding products priced at customary levels. The "expected" prices for such products are referred to as:

answer

Price points.

question

A producer may offer a margin different from that offered by competitive brands if:

answer

If the customers associate superior benefits with the product.

question

In attempting to gain price control in the channel, the manufacturer should use:

answer

"Friendly persuasion."

question

A manufacturer may feel it needs to control resale price for all of the following reasons except:

answer

It needs all channel members to perform in a specific manner in order to meet strategic objectives.

question

Generally, when manufacturers make major changes in their pricing structure, channel members usually are __________ when manufacturers make major changes in their terms of sale.

answer

as uneasy as

question

Before automatically passing price increases through the channel, the manufacturer should:

answer

Do whatever it can do to mitigate the negative effects of the increase on channel members.

question

Differing perceptions of price incentives between the consumers and channel members' viewpoints stem from:

answer

Differing price elasticities.

question

Of all the elements in the marketing mix, channel members at the wholesale and retail levels view __________ as being most in their domain.

answer

pricing

question

The __________ often causes a problem with price promotions.

answer

differing price elasticities of consumers and retailers

question

The sale of well-known brand products by unauthorized dealers, usually at very low prices, is referred to as:

answer

The gray market.

question

Distributors and dealers who offer extremely low prices but little if any service to customers are engaging in a practice called:

answer

Free riding.

question

A customer buying a branded product from a low-priced distributor likely is:

answer

There is no way to tell from the information given.

question

Manufacturers are often concerned about their products being involved in the gray market for all of the following reasons except:

answer

Consumers may stop buying the product because of a perceived decrease in value.

question

When a channel member makes disparaging remarks about a product in order to sell a competitor's product, the channel member is engaging in:

answer

Footballing.

question

One of the main issues Proctor & Gamble (P&G) Company had with its Max Factor is:

answer

Giant mass market U.S. retailers were not willing to give more shelf space to Max Factor products.

question

The effectiveness of the overall promotional strategy depends on how successful the manufacturer is in:

answer

Securing cooperation from independent channel members in implementing the promotional strategy.

question

___________ is a term used to refer to the use of several promotional tools in a coordinated effort to achieve maximum promotional impact.

answer

Integrated marketing communication

question

In a pull and push promotional strategy, the three main flows involved are:

answer

Product, negotiation, and promotion.

question

Of the total expenditures by all manufacturers on promotion about __________ of every dollar spent goes for push type promotions.

answer

50%

question

Push and pull promotion:

answer

Can be used together successfully.

question

The belief underlying the so-called pull strategy is?

answer

By building strong consumer demand for their products, manufacturers pressure channel members to promote these products.

question

The underlying concept behind the push promotional strategy is:

answer

Securing mutual effort and cooperation between manufacturers and channel members in the use of promotion.

question

The increasing emphasis on push promotions in recent years is attributed to:

answer

The increasing size and power of retailers and wholesalers.

question

Retailers and wholesalers are __________ content to be conduits that giant manufacturers using massive national advertising can send their products smoothly through to final customers.

answer

no longer

question

In order for a cooperative advertising program to work effectively, the channel members must do all of the following except:

answer

Pass the high cost of print ads to the manufacturer.

question

Which of the following is a common abuse of cooperative advertising money by retailers?

answer

Retailers buying newspaper space at rates lower than what they bill manufacturers.

question

Cooperative advertising dollars are also called:

answer

Case allowances.

question

Channel members are often reluctant to support advertising programs if they feel there is too much emphasis on the manufacturer's products and not enough emphasis on:

answer

Patronage appeals.

question

The most typical strategy used for promotional allowances is to offer channel members:

answer

A percentage of purchases on particular products.

question

It is now easier for manufacturers to measure the effect of promotional allowances because of:

answer

Outside consulting firms.

question

________ are payments made by manufacturers to encourage channel members to display and stock new products.

answer

Slotting allowances

question

Slotting fees are most commonly used in the ________ industry.

answer

grocery

question

Which of the following is a false statement about slotting fees?

answer

Slotting fees may discriminate against large manufacturers who are willing and able to pay high fees.

question

It is expected that ________ may become the most dominant form of promotional allowance demanded by large retailers.

answer

slotting fees

question

Which of the following is not an example of displays and/or selling aids?

answer

Billboards

question

Which of the following is an accurate statement regarding displays and selling aids?

answer

Often manufacturers have difficulty getting retailers to use displays and selling aids.

question

Which of the following is not a feature of the Evergreen and Ivy display for candles?

answer

It handles product that comes in one size.

question

Which of the following is not an example of in-store promotion?

answer

Cardboard cutouts

question

In using in-store promotions, the most critical factor for the channel manager to consider in judging the probable effectiveness of the promotion is:

answer

The benefits of the program as perceived by retailers.

question

For samples to be an effective in-store promotion, it is suggested that:

answer

Channel managers and retailers will need to be more clever and develop situational sampling.

question

From the standpoint of the manufacturer, using trade shows as a promotional strategy for motivating channel members is beneficial for all the following reasons except:

answer

It is an effective way to gain government approval for new products.

question

Many channel members feel that when it comes to contests and incentives:

answer

They are a one-sided deal in the manufacturer's favor.

question

The practice whereby intermediaries, under special promotional deals, buy more inventory than they possibly could sell in a reasonable period of time is known as:

answer

Trade loading.

question

Forward buying causes:

answer

A slowdown in the distribution process.

question

Training programs at the wholesale level should be aimed at improving all of the following except:

answer

Knowledge of tax implications for their respective companies.

question

Consultants such as SymphonyIRIGroup have made it feasible for manufacturers to:

answer

Measure the effects of promotional programs more accurately.

question

Effective retail training programs should include all of the following except:

answer

How retail customers can promote products.

question

Sales quotas for channel members:

answer

Should be set in conjunction with the channel member.

question

Sales quotas are a way for the manufacturer to communicate:

answer

Information regarding the channel member's territory sales potential.

question

Which of the following activities is not usually performed by missionary salespeople calling on retailers?

answer

Conducting customer surveys

question

Which of the following is not true about missionary selling in the industrial market?

answer

It is inexpensive.

question

Which of the following is not an advantage of using trade shows as a promotional strategy?

answer

Provides an opportunity to advise and give technical assistance to channel members

question

Trade shows, if conducted properly, provide the manufacturer with an opportunity to strengthen its __________ power base.

answer

referent

Marketing Channels Exam 3 – Flashcards

Unlock all answers in this set

Haven't found what you were looking for?

Search for samples, answers to your questions and flashcards