Marketing Chapters 1-4 (combined)
a. Only through very careful study of relevant marketing success stories.
b. By even the average person, who has a great deal of shopping experience.
c. Typically through a comprehensive study of product failures.
d. Only by large firms with many years of experience; it is practically impossible for entrepreneurial startup companies to achieve it.
e. Most often by mentoring from experienced marketing professionals.
EXPLANATION: You are already a marketing expert; you perform many marketing activities and make marketing-related decisions every day. Your experience in shopping gives you some expertise in marketing. As a consumer, you’ve been involved in thousands of marketing decisions, but mostly on the buying and not the selling side.
a. Almost all small businesses consider marketing a luxury rather than a necessity.
b. Small businesses are the source of the majority of new jobs in the United States.
c. More than half of small businesses fail because they must answer to shareholders.
d. Marketing in small businesses rarely succeeds because the economic environment is too unstable.
e. Small businesses traditionally hire only those market managers who have already proven themselves at a major corporation.
EXPLANATION: Marketing takes place not only in large corporations but also in small. Since small businesses provide the majority of new jobs in the United States, there should be opportunities for marketers to help them succeed.
a. create and amplify
b. discover and satisfy
c. improve and perfect
d. persuade and deliver
e. establish and assure
EXPLANATION: To serve both buyers and sellers, marketing seeks (1) to discover the needs and wants of prospective customers and (2) to satisfy them.
a. only those persons desiring the product, regardless of whether they plan to purchase it or not.
b. individuals or organizations making purchases either for themselves or others, regardless of whether it is for personal use or for resale.
c. people who will likely make repeated purchases of this product or similar items in the product line.
d. people who do not even know about this product but who can be convinced that they have a need for it.
e. people who purchased the product once before but were dissatisfied with its initial performance.
EXPLANATION: Prospective customers include both individuals, buying for themselves and their households and organizations that buy for their own use (manufacturers) or for the resale (wholesalers and retailers).
a. Yes, because the sorority promotes itself as being charitable.
b. Yes, because painting the fences was exchanged for something of value—a feeling of satisfaction.
c. No, because the sorority is a nonprofit organization.
d. No, because no money was exchanged.
e. No, because Beth did not receive a tangible product, such as a “thank you” gift.
EXPLANATION: Marketers seek to discover and satisfy the needs and wants of customers. The key to achieving these objectives is exchange—the trade of things of value between buyer and seller so that each benefits from the exchange. An exchange did occur: Beth exchanges her painting for a feeling of satisfaction; the community reduces blight.
a. you probably did not have a true need for the power cord.
b. the products sold at the store were too expensive for you to afford.
c. the company has poor customer service.
d. there was no way for the parties to communicate.
e. there is a lot of competition in the computer power cord segment.
EXPLANATION: Four factors are required for marketing to occur: (1) two or more parties (individuals or organizations) with unsatisfied needs, (2) a desire and ability on their part to be satisfied, (3) a way for the parties to communicate, and (4) something to exchange.
EXPLANATION: If you feel hungry, you have developed a basic need to eat something. You then want to eat an apple or a candy bar because, based on your past experience and personality, you know these will satisfy your hunger need.
c. Customer pool
d. Customer cluster
e. Buying group
EXPLANATION: Key term definition—market.
a. mass market
b. tangental market
c. market aggregation
d. target market
e. product grouping
EXPLANATION: A target market is a specific group of potential consumers toward which an organization directs its marketing program, in this case the homeowners.
e. physical environment
EXPLANATION: Key term definition—marketing mix. Three of the alternatives (people, process, and physical environment) comprise the seven Ps of services marketing.
e. physical environment
EXPLANATION: Within the marketing mix, place is defined as a means of getting the product to the consumer.
a. form utility
b. possession utility
c. time utility
d. customer value proposition
e. intangible environment
EXPLANATION: Designing an effective marketing mix also conveys to potential buyers a clear customer value proposition, which is a cluster of benefits that an organization promises customers to satisfy their needs. For example, Walmart’s customer value proposition can be described as “everyday low prices for a broad range of products that are always in stock in convenient locations.”
a. the four Ps
b. the marketing mix
c. marketer factors
d. environmental forces
EXPLANATION: Key term definition—environmental forces. The uncontrollable environmental forces in a marketing decision are those involving social, economic, technological, competitive, and regulatory forces.
a. a marketing program
b. market segmentation
c. stakeholder value
d. relationship marketing
e. strategic partnership
EXPLANATION: Key term definition—relationship marketing.
a. create a target market mission statement.
b. determine if there are pre-existing products that satisfy these needs.
c. translate information about consumer needs into product concepts.
d. design product prototypes at multiple price points.
e. develop a customer value strategy to create long-term customer loyalty.
EXPLANATION: A marketing program is defined as a plan that integrates the marketing mix to provide a good, service, or idea to prospective buyers. Consumer needs trigger product concepts that are translated into actual products that stimulate further discovery of consumer needs.
a. The population was moving away from urban to rural areas.
b. There were too many customers to serve.
c. Competition grew and the production of goods increased.
d. Advertising was becoming a major marketing force.
e. Technology was in a dormant stage.
EXPLANATION: During the production era, firms could sell as many products as they could manufacture. However, during the sales era, many firms discovered that they could produce more goods than their regular buyers could consume. Competition grew. The usual solution was to hire more salespeople to find new buyers.
a. while also trying to achieve the organization’s goals.
b. as its sole focus.
c. while simultaneously creating new needs.
d. through strong customer relationships.
e. without any market segmentation.
EXPLANATION: Key term definition—marketing concept.
a. customer experience management.
b. the societal marketing concept.
c. customer relationship management.
d. the marketing concept.
e. consumer sustainability marketing.
EXPLANATION: Key term definition—customer relationship management (CRM).
a. exchanged; is performed free of charge.
b. valued by the consumer; valued only by organizational buyers.
c. a direct form of customer value; a customer value proposition.
d. part of the regulatory environment; free from regulation.
e. a physical object; intangible.
EXPLANATION: Goods, services, and ideas are marketed. Goods are physical objects, such as toothpaste, cameras, or computers, that satisfy consumer needs. Services are intangible items such as airline trips, financial advice, or art museums.
a. An iPhone with a large selection of new apps.
b. ATM machines in thousands of locations.
c. A service station that sells both regular gasoline and diesel fuel.
d. A wireless smartphone company offers six-month financing, same as cash.
e. Cold cut packages that can be zipped closed for reuse.
EXPLANATION: Place utility is the value to consumers of having a good or service available where needed. ATM machines offer place utility by being available in many convenient locations.
b. nonprofit organization
c. board of directors
e. business firm
EXPLANATION: A nonprofit organization is a nongovernmental organization that serves its customers but does not have profit as an organizational goal. Instead, its goals may be operational efficiency or client satisfaction. Regardless, it also must receive sufficient funds above its expenses to continue operations.
a. Business and nonprofit
b. Corporate and strategic business unit
c. Functional and corporate
d. Functional and industry
e. Business and corporate
EXPLANATION: For less complex firms with a single business focus, such as Ben & Jerry’s, the corporate and business unit levels may merge.
a. Board of directors
b. Corporate level
c. Strategic business unit level
d. Functional level
e. Specialized level
EXPLANATION: Each strategic business unit has a functional level, where groups of specialists actually create value for the organization. The term department generally refers to these specialized functions such as marketing and finance. See Figure 2-1 in the textbook.
EXPLANATION: A visionary organization must specify its foundation (why does it exist?), set a direction (what will it do?), and formulate strategies (how will it do it?). See Figure 2-2 in the textbook.
a. core value
c. organizational culture
e. competitive advantage
EXPLANATION: A mission is a statement of the organization’s function in society that often identifies its customers, markets, products, and technologies. Often used interchangeably with vision, a mission statement should be clear, concise, meaningful, inspirational, and long-term, such as the mission statement for Southwest Airlines.
d. marketing metrics
e. market penetration
EXPLANATION: A business describes the clear, broad, underlying industry or market sector of an organization’s offering. To help define its business, an organization looks at the set of organizations that sell similar offerings, those that are in direct competition with each other. Professor Theodore Levitt saw that 20th century American railroads defined their business too narrowly, proclaiming, “We are in the railroad business!” This myopic focus caused them to lose sight of who their customers were and what they needed. So railroads failed to develop strategies to compete with airlines, barges, pipelines, and trucks.
a. Customer satisfaction goals are known to increase costs and reduce profits.
b. Selecting a market share goal is only meaningful if you first make profit a goal.
c. A business firm should select only one business goal so it can maintain focus.
d. Only nonprofit organizations have the luxury of selecting social responsibility and employee welfare as goals.
e. If profits are acceptable, a company may elect to maintain or increase its sales even though profits may not be maximized.
EXPLANATION: For profit organizations can pursue several different types of goals: profit, sales, market share, quality, customer satisfaction, employee welfare, and social responsibility. When choosing a sales goal, if profits are acceptable, a firm may elect to maintain or increase its sales even though profits may not be maximized.
a. profit responsibility
b. unit sales
c. sales revenue
d. market share
e. social responsibility
EXPLANATION: Market share is the ratio of sales revenue of the firm to the total sales revenue of all firms in the industry, including the firm itself. The North Face plans to increase its own market share at the expense of its competitors in Europe.
a. implementation; target market
b.planning; competitor analysis
c.evaluation; financial statement
d. planning; marketing plan
e. evaluation; annual report
EXPLANATION: A marketing plan is a road map for the marketing activities of an organization for a specified future time period, such as one year or five years. The planning phase of the strategic marketing process (discussed later in this chapter) usually results in a marketing plan that sets the direction for the marketing activities of an organization.
a. human resource reports
b. marketing metrics
c. financial statements
d. qualitative opinions
e. points of difference
EXPLANATION: Each display in a marketing dashboard shows a marketing metric, which is a measure of the quantitative value or trend of a marketing activity or result. The choice of which marketing metrics to display is critical for a busy marketing manager, who can be overwhelmed with irrelevant data.
a. Point of distinction
c. Competitive advantage
d. Sustainable advantage
e. Competitive competency
EXPLANATION: Text term definition—competitive advantage.
a. cash cows
EXPLANATION: Text term definition—cash cows.
a. selling new products to current markets.
b. selling current products to new markets.
c. increasing sales of current product in current markets.
d. acquiring other companies to develop new products.
e. developing new products and selling them in new markets.
EXPLANATION: Text term definition—product development. See Figure 2-5 in the textbook.
b. financial analysis.
c. the marketing program.
e. functional-level strategy.
EXPLANATION: The strategic marketing process is comprised of three phases: planning, implementation, and evaluation. See Figure 2-6 in the textbook.
e. trend not to be concerned with for it will soon pass
EXPLANATION: A threat is an external factor that is negative. This is a negative change in shopping behavior that is causing problems for retailers like Best Buy.
a. Developing a mission statement
b. Testing the product
c. Testing the market
d. Selecting target markets
e. Evaluating the marketing program
EXPLANATION: Determining which products will be directed toward which customers (step 2 of the planning phase) is essential for developing an effective marketing program (step 3). The following marketing activities are performed during step 2: (1) segment the market, (2) set marketing and product goals, (3) select target markets, (4) find points of difference, and (5) position the product. So step 2 in the planning phase of the strategic marketing process—deciding which products will be directed toward which customers—is the foundation for step 3: developing the marketing program. See Figure 2-6 in the textbook.
a. core competencies.
b. organizational culture.
c. evaluation criteria.
d. alternate target market.
e. its budget.
EXPLANATION: Step 3 in the planning phase, the marketing program, involves developing the program’s marketing mix (the four Ps) and its budget.
a. the goal-setting phase.
b. the evaluation phase.
c. the implementation phase.
d. the strategic development phase.
e. the planning phase.
EXPLANATION: The best-planned marketing strategy is virtually worthless if the plan cannot be successfully implemented and executed. Successful implementation requires the effective execution of the marketing strategies and tactics that comprise the marketing program for an offering. This plan appears to have been poorly implemented as far as the web interface with modern users, which is the important marketing tactic here.
a. Marketing plans
b. Marketing tactics
c. Business plans
d. Marketing strategy
EXPLANATION: To implement a marketing program successfully, hundreds of detailed decisions are often required. These decisions, called marketing tactics, are detailed day-to-day operational decisions essential to the overall success of marketing strategies. Writing ads and setting prices for new product lines are examples of marketing tactics.
a. implementation phase.
b. planning phase.
c. analysis phase.
d. evaluation phase.
e. goal-setting phase.
EXPLANATION: The evaluation phase of the strategic marketing process seeks to keep the marketing program moving in the direction set for it (see Figure 2-6 in the textbook). Accomplishing this requires the marketing manager to (1) compare the results of the marketing program with the goals in the written plans to identify deviations and (2) act on these deviations—correcting negative deviations and exploiting positive ones.
a. Trend analysis
b. Organizational scanning
c. Environmental scanning
d. A SWOT analysis
e. Threat assessment
EXPLANATION: Key term definition—environmental scanning.
EXPLANATION: Economic forces like rising input costs are generally considered to be one of the uncontrollable or environmental forces that include social, technological, economic, competitive, and regulatory forces.
a. before the Great Depression.
b. before Generation X.
c. after millennials.
d. after Generation Y.
e. very recently, within the last 10 years.
EXPLANATION: Baby boomers’ were born between 1946 and 1964, before Generation X, Generation Y, and millennials.
a. after World War I and before 1946.
b. between 1946 and 1990.
c. between 1977 and 1994.
d. between 1946 and 1964.
e. between 1965 and 1976.
EXPLANATION: Key term definition—Generation X.
a. Tablet devices
b. Long-term care insurance
c. Mutual fund investments
d. International cruise vacations
e. Luxury automobiles
EXPLANATION: Generation Y includes those born between 1977 and 1994. Generation Y exerts influence on music, sports, computers, video games, and all forms of communication—and likely tablet devices like the iPad.
a. multicultural household
b. blended family
c. co-mingled household
d. bundled family
e. multigenerational household
EXPLANATION: Key term definition—blended family.
a. at least 10,000.
b. at least 50,000.
c. at least 1,000,000.
d. at least 2.5 million.
e. at least 10 million.
EXPLANATION: Text term definition—micropolitan statistical area.
a. Generation Z
b. baby busters
c. Generation Y
d. baby boomers
e. Generation X
EXPLANATION: Several factors have contributed to the shift in cultural attitudes and roles among men and women since the 1970s and 1980s. Today, Generation Y represents the first generational cohort of women who have not collective memory of the dramatic changes that have taken place.
a. the belief in fate, focus on the future, and acceptance of birthright.
b. personal control, continuous change, and competition.
c. the need for stability, importance of tradition, and a focus on family.
d. efficiency, material comfort, and a focus on group welfare.
e. achievement, external control, and a focus on the present.
EXPLANATION: Culture includes values that may differ over time and between countries. Today, commonly held values include personal control, continuous change, equality, individualism, self-help, competition, future orientation, and action, which are useful in understanding the behaviors of U.S. consumers.
a. customer value
b. the value proposition
c. buyer-centric excellence
d. purchasing value
e. value consciousness
EXPLANATION: Key term definition—value consciousness.
b. inflationary periods.
c. competitive cycles.
d. discretionary patterns.
EXPLANATION: Periods of declining economic activity are referred to as recessions. During recessions, businesses decrease production, unemployment rises, and many consumers have less money to spend.
a. net income.
b. disposable income.
c. discretionary income.
d. gross income.
e. earned income after taxes.
EXPLANATION: Discretionary income is the money that remains after paying for taxes and necessities and is used for “luxury” expenses such as vacations or other non-necessities.
EXPLANATION: Technology refers to inventions or innovations from applied science or engineering research such as “natural user interfaces” that are utilizing gesture, touch, and voice to change the way we interact with and control computers and complicated machines.
e. Digital commerce
EXPLANATION: Key term definition—marketspace.
a. a digital marketplace.
c. an intranet.
d. an extranet.
e. electronic commerce.
EXPLANATION: Text term definition—electronic commerce.
c. Pure competition
d. Monopolistic competition
EXPLANATION: An oligopoly occurs when a few companies control the majority of industry sales, as is the case in the tablet device market.
a. it created a true regulatory agency with enforcement powers.
b. it protected small businesses from the growing power of large chains.
c. it strongly encouraged self-regulation practices through the use of moral suasion.
d. it forbade certain actions that lessen competition, even if no actual has yet occurred.
e. it provided a way for businesses to protect their intellectual property.
EXPLANATION: Because of vague wording and government inactivity, there was only one successful case against a company in the nine years after the Sherman Act became law, and it was supplemented with the Clayton Act (1914). This act forbids certain actions that are likely to lessen competition, although no actual harm has yet occurred.
c. environmental scans
EXPLANATION: Consumers benefit from trademarks because it allows them to correctly identify products they want to purchase.
a. Patent Act
b. Lanham Act
c. Sherman Antitrust Act
d. Hart-Scott-Rodino Act
e. Miller-Tydings Act
EXPLANATION: Text term definition—Lanham Act.
e. Zip code.
EXPLANATION: A company can lose its trademark if it becomes generic, which means that it has primarily come to be merely a common descriptive word for the product. Coca-Cola, Whopper, and Xerox are registered trademarks, and competitors cannot use these names.
a. insurance company professionals
b. legal professionals
c. car salespeople
e. news media
EXPLANATION: Car salespeople are considered to be among the least ethical occupations in the United States.
a. exchange relationship between sellers and buyers.
b. competitive behavior between unrelated industries.
c. price, service, and product responsibility to the ultimate consumer.
d. accountability of buyers and sellers to federal and state legislation.
e. perception of ethical behavior as viewed by society as a whole.
EXPLANATION: Business cultures comprise the effective rules of the game, the boundaries between competitive and unethical behavior, and the codes of conduct in business dealings. Business culture affects ethical conduct both in the exchange relationship between sellers and buyers and in the competitive behavior among sellers.
a. Cash on delivery
b. Let the buyer beware
c. Through or of itself
d. Such is life
e. Question the motives
EXPLANATION: Key term definition—caveat emptor.
a. President John F. Kennedy
b. President Gerald Ford
c. President Bill Clinton
d. President George H. W. Bush
e. President Barack Obama
EXPLANATION: In 1962, John F. Kennedy sponsored the Consumer Bill of Rights, a law that codified the ethics of exchange between buyers and sellers, which included the rights to safety, to be informed, to choose, and to be heard.
a. environmental scanning.
b. economic espionage.
c. trade exchange.
e. moral idealism.
EXPLANATION: Economic espionage is the clandestine collection of trade secrets or proprietary information about a company’s competitors. This practice is illegal and unethical and carries serious criminal penalties for the offending individual or business. Espionage activities include illegal trespassing, theft, fraud, misrepresentation, wiretapping, the search of a competitor’s trash, and violations of written and implicit employment agreements with noncompete clauses.
e. New Zealand
EXPLANATION: Bribery is most evident in industries experiencing intense competition and in countries in earlier stages of economic development. Russia was the most likely country to engage in bribery to win or retain business while The Netherlands, Switzerland, and Belgium were the least likely.
a. The set of values, ideas, and attitudes that is learned and shared among the members of an organization
b. The state and local laws regarding ethical business behavior
c. A formal statement of ethical principles and rules of conduct
d. The dress codes, teamwork rules, and permissible sayings of its employees
e. The fundamental, passionate, and enduring principles that guide an organization’s conduct over time
EXPLANATION: Key term definition—code of ethics.
a. Mission statements
b. State and local laws
c. Codes of ethics
d. Legal handbooks
EXPLANATION: A code of ethics is a formal statement of ethical principles and rules of conduct. It is estimated that 86 percent of U.S. companies have some sort of ethics code and one of every four large companies has corporate ethics officers. Ethics codes typically address contributions to government officials and political parties, customer and supplier relations, conflicts of interest, and accurate recordkeeping.
EXPLANATION: See American Marketing Association Statement of Ethics—Ethical Values section: Figure 4-3.
c. corporate spy.
EXPLANATION: Whistle-blowers are employees who report unethical or illegal actions of their employers.
a. A personal moral philosophy that focuses on the greatest good for the greatest number by assessing the costs and benefits of the consequences of ethical behavior
b. A democratic consensus of moral principles and laws that govern the behavior of individuals based on legislation adopted at the federal, state, and local levels
c. A societal moral philosophy based on the Golden Rule of the Judeo-Christian ethic found in the Bill of Rights of the U.S. Constitution
d. A formal statement of ethical principles and rules of conduct
e. A personal moral philosophy that considers individual rights or duties as universal, regardless of the outcome
EXPLANATION: Key term definition—moral idealism.
a. a personal moral philosophy that focuses on “the greatest good for the greatest number” by assessing the costs and benefits of the consequences of ethical behavior
b. a democratic consensus of moral principles and laws that govern the behavior of individuals based on legislation adopted at the federal, state, and local levels
c. a societal moral philosophy based on the Golden Rule ethic found in the Bill of Rights of the U.S. Constitution
d. a formal statement of ethical principles and rules of conduct
e. a personal moral philosophy that considers individual rights or duties as universal, regardless of the outcome
EXPLANATION: Key term definition—utilitarianism.
a. The general public, public interest groups, and environmental groups
b. Owners and stockholders
c. The general public, owners, and stockholders
d. Consumers, employees, and suppliers
e. Federal, state, and local governments
EXPLANATION: Companies practicing profit responsibility serve owners and stockholders. Companies practicing stakeholder responsibility primarily serve consumers, suppliers, distributors, and employees. Companies practicing societal responsibility primarily have obligations to the preservation of the ecological environment and to the general public. See Figure 4-4 in the textbook.
a. Social responsibility
b. The triple-bottom-line
c. The marketing concept
e. Social entrepreneurship
EXPLANATION: Key term definition—triple-bottom line.
a. a social audit.
b. green marketing.
c. the marketing concept.
e. social entrepreneurship.
EXPLANATION: Green marketing is the result of marketing efforts to produce, promote, and reclaim environmentally sensitive products. These companies are drawing attention to the environmental importance of palm oil and providing products that use an eco-friendlier alternative.
a. a plan to encourage the purchase of “Made in America” products.
b. a set of guidelines for firms to use when developing cause marketing initiatives.
c. an international program to promote green marketing.
d. a marketing metric that measures how well a firm performs on its sustainability efforts.
e. a set of standards for the registration and certification of a manufacturer’s quality management and assurance system based on an on-site audit of practices and procedures.
EXPLANATION: Key term definition—ISO 14000.
a. action plan.
b. tactical plan.
c. research plan.
d. social audit.
e. financial audit.
EXPLANATION: Many companies develop, implement, and evaluate their social responsibility efforts by means of a social audit, which is a systematic assessment of a firm’s objectives, strategies, and performance in terms of social responsibility.
a. Evaluate current social responsibility programs.
b. Determine the amount of money that can be allocated for societal marketing programs.
c. Identify social responsibility causes consistent with the company’s mission.
d. Recognize a firm’s social expectations and the rationale for engaging in social responsibility endeavors.
e. Determine the types of resources needed to achieve social responsibility objectives.
EXPLANATION: A social audit consists of five steps, the last of which is to evaluate the organization’s social responsibility programs and activities undertaken and to assess its future involvement in them.
a. sustainable development
b. cause marketing
c. stakeholder responsibility
d. the marketing concept
e. environmental marketing
EXPLANATION: Key term definition—sustainable development.
a. Food and Drug Administration (FDA)
b. Federal Trade Commission (FTC)
c. International Standards Organization (ISO)
d. U.S. Supreme Court
e. American Marketing Association (AMA)
EXPLANATION: The Federal Trade Commission (FTC) has developed guidelines to describe the circumstances under which an organization can make environmental claims without constituting misleading information in regard to recyclable, biodegradable, and sustainable products and processes.
Get access to
Guarantee No Hidden