You and five family members each work for a different company that can be categorized in one of the four major business markets. Choose the company description(s) that is(are) correctly categorized.
Your father works the on-call shift in the ICU at the local hospital. This is an institution.
Your cousin is the dean of admissions of a local community college. This is an institution.
Your mother purchases the items for Kraft Foods that comprise the company’s prepackaged meals. This is a commercial market.
Your brother works in the New York Public Library. This is in the government market.
A(n) can include a company’s criteria for the number of vendors it is willing to use. This practice is referred to as . Depending on the company in question, it may choose to use many or just a few vendors.
The role of in the purchase decision is an environmental factor.
The role of the merchandiser or advisor is linked with centralization of the purchasing process. is a term applicable to a salesperson who knows the ins and outs of the product he sells.
Raquel has a meeting with a pharmaceutical rep at the medical office where she works. Over lunch, the rep shows her brochures that highlight a new drug his company manufactures to relieve the symptoms associated with migraine headaches. Raquel sees the benefits of the new drug and has decided to pass on the brochures and samples that the pharmaceutical rep gave her to the doctors in the practice. She is also going to allow the rep to set up a breakfast meeting with some of the doctors on Thursday.
In what buying center role is Raquel operating?
The business-to-business (B2B) market varies widely among companies. You work for a company that employs customer-type segmentation. The company:
uses North American Industry Classification System (NAICS) to provide details that outline the twenty-first-century economy; groups its customers into large categories and industries, and then narrows the large categories and industries into smaller distinct groups based on their characteristics; and recognizes very precise and unique needs that its business purchasers have when compared to those of individual buyers.
Which of the following is a benefit for using this kind of approach to segmentation?
Companies can create products based on detailed buyer specifications.
Differences in the marketing techniques used for consumer and business products vary greatly. Demand characteristics also vary; in the business market they can be classified under five categories.
Select the statements that are true about demand characteristics in the business market.
Joint demand requires two products used in combination with one another.
Inelastic demand states that product demand is relatively resistant to price changes.
Select the statement(s) that correctly identify(ies) the role of the individual described in the scenario.
The rotary engineer whom Rajah’s company hired gives him specialized criteria for the parts the company needs for the turbines it builds. He is an influencer.
Tallulah is happy to see that her new desktop scanner is much faster than the older model she previously used. She is a user.
Morgan elects to use TableTop, Inc. parts because it is the only company that manufactures the hinges her designs require. She is a decider.
You as a marketer are trying to understand business buying behavior. The dynamics associated with the influences on business purchases include four major categories. The list below describes one of the major influences in a company’s business buying behavior.
A marketer has a good idea of the customer’s needs and wants, and truly believes in the product or service he/she is marketing.
Marketers know the various options that the company has in regard to the product under discussion. A marketer wants to find out who has a say in determining the products the company will purchase, and anticipate the questions that group or individual might have.
Which of the following terms best describes this type of influence on a company’s purchase decision?
You work for a small startup firm that specializes in the creation of artificial intelligence programs. In order to expand product offerings, the firm needs to develop software to create augmented and virtual reality games. Though the firm is strapped for funds and the CEO is not comfortable investing the resources needed for this project, he hopes that the investment will help the company become more competitive in the market. Company executives also consider buying or leasing the technology, rather than manufacturing it themselves. In the end, they decide to manufacture the product, but don’t see the 20% increase in profits they had projected for the first year. Executives also suspect that the quality of their product is not as high as they would have liked.
Which of the following can be inferred about the company from the scenario provided above?
They did not have enough capital to begin with; thus, they should have probably leased the software.
A company is evaluating its options before making a decision regarding the feasibility of obtaining an automatic postage machine. The amount of mail the company sends out daily has steadily increased over the last year, so it makes sense to automate the process. The company’s managers realize that if they _________ the machine, then they will be able to upgrade easily, whereas if they __________ the machine, they will be responsible for all costs incurred in upgrading.
In the United States, the consumer market is geographically concentrated than the business market.
Marketers have a large amount of statistical data to help them estimate the size and number of potential buyers. The federal government has data available than any other source.
Purchase decisions often require multiple rounds of on the part of the buyer and seller. relationships are often complex, and require a commitment to excellent communication by both parties. is the practice of an organization’s purchase of products or services from suppliers on a worldwide scale.
Bidding and negotiation
You have been tasked by your company to design a new website that highlights the advantages of picking your company for potential clients. The points below describe your company:
The company purchases items and is able to repackage them in order to sell them to consumers.
The company buys items in bulk and then can sell the product to their clients in the quantities and sizes they need.
The items your company buys can be customized and tailored to suit individual needs on a client-to-client basis.
Which of the following business market categories best describes your company?
The organizational buying situation takes place through a sequence of activities, from anticipating or recognizing the problem, need, or opportunity, to obtaining feedback and evaluating the vendor’s performance.
You work for a furniture company whose vice-president of procurement has decided to work with McKenzie Manufacturers to produce the company’s home furnishings line. The vice-president had worked with McKenzie several years earlier at a different company so felt comfortable with them. Rather than the ordinary vetting of a contractor that takes place, the contract was an agreement based on mutual trust not on specifics. About 6 months into the contract, your company learns that McKenzie Manufacturers has gone bankrupt and can longer fulfill their end of the contract you have in place. The vice president of procurement is disappointed because he had no clue the manufacturer was in financial trouble.
Which of the following is the best possible explanation for why the VP of procurement did not know that the manufacturer was in financial trouble?
The VP and his staff did not access the quality of the products produced by the manufacturer prior to selecting this company as its primary supplier.
Described below are characteristics of a category of the business buying situation that can be affected by a variety of factors and influences:
A company could perform a value analysis because lately, it hasn’t been satisfied with the purchased items it has been receiving; the marketer’s competition has raised some questions and concerns in the business purchaser’s mind; the purchaser has decided to reevaluate the current purchases even though she has been purchasing the same items for quite some time.
Which of the following categories best describes the characteristics stated above?
Business A identifies the size of the company it is trying to market to in order to understand the potential customer’s needs depending on how many people it employs. Business A is using the segment.
Business B recognizes that one of their customers frequently buys paper, and offers a discount on the customer’s paper supply needs; this is the segment.
Business C illustrates the segment by focusing on the unique needs of a hospital which seeks specialized supplies with strict performance requirements.
End use application
You work as a contract manager for a local department of health and have been asked to support the procurement analysis process. You notice that the procurement department still employs manual procedures, rather than managing purchasing online. You suggest that they create a vendor list that can be managed on the web. The online catalogues will help them compare competing product offerings in an efficient way.
Which of the following is a potential drawback of governmental agencies embracing electronic commerce?
Training staff to use new systems can be time consuming
In a market, purchases often involve many individuals who play a part in the decision process.
An institutional market is known to have very different and unique .
markets often include business purchasers who opt for remanufactured items.
You work for an automobile and truck manufacturer that practices reciprocity with the firm that supplies their engines. For the first few months after the agreement was put into place, both companies benefit and see an increase in profits.
However, by the third quarter, your company is losing money because the engines in your 18-wheeler trucks have been stalling. Company executives have had to recall some of the trucks.
Based on the information provided, what could have been the root cause of this problem?
The automobile manufacturer did not use the right vendor and value analysis systems to examine each component of the purchase.
Indicate which of the following scenarios describes the first stage, recognizing a problem and general solution.
The dishwasher in your company’s break room broke and needs to be replaced.
Since the conclusion of World War II, multinational economic integration has grown. It is a significant force that influences marketing decisions in financial and political ways. Three basic concepts of multinational economic integration can be arranged along a continuum from narrowest to broadest scope of effect.
Identify the concept of multinational economic integration with the narrowest effect.
You are the marketing manager for a chain of child care facilities, which recently expanded to become international. Your team is making decisions about an alternative marketing mix strategy to get your global customers engaged. While watching the Academy Awards on TV, you realize that some details about your current American campaign appear to closely resemble a commercial you see.
Which approach seems the most prudent to take?
Two new vehicles are benefiting from luxury autombile company Lexus’ change from a multidomestic marketing strategy to a global marketing strategy in 2014. The cars are the NX compact cross-over and the RC sporty coupe. Lexus’ new marketing process starts with 25 marketers from their top ten global markets meeting up to a year before a vehicle’s initial launch.
What advantages could they expect to experience by their changed approach?
Reduced cost of filming ads along coastal roads
Leveraging creative input into the marketing plan
Consistent brand messaging
Not all purchases involve the exchange of goods or services for money. Companies and countries have had to bring creativity and persistence to trade arrangements due to limitations in a specific international environment. Once initial efforts are successful, the types of countertrade activity can continue uninterrupted.
Which of the following examples of countertrade activity is(are) correctly described?
China builds roads, trains, hospitals, and schools in the Congo in exchange for the Congo’s metals is an example of counter purchasing.
American soda exchanged for Russian vodka is a type of barter.
Thai fruits exchanged for Chinese buses is a type of barter.
There are hundreds of international trade agreements in effect in the global marketplace. Some of these agreements create marketing opportunities while others impose significant barriers to international trade interactions. The marketer must know which agreements affect the international markets she is targeting.
Which of the following international trade agreements is(are) described correctly?
The European Union is a huge common market of over 500 million people working to create a common currency among its members.
CAFTA-DR is an agreement among the United States, Central American nations, and the Dominican Republic.
WTO is a global entity to reduce trade barriers among member nations, which replaced GATT, oversees GATT agreements, and mediates disputes.
Your company’s global marketing strategy defines a plan with its .
Your company relies on its previous success in implementing the plan with .
This approach has the advantage of lower cost due to for marketing activities.
A standardized approach saves money because it allows , and reinforces your company’s
Standard marketing mix
Economies of scale
Large-scale production runs
is the practice of contracting with another organization to perform some or all business functions.
occurs when a company hires a foreign firm to produce a designated volume of the firm’s products to specifications, and the final product carries the domestic firm’s name.
is a contractual agreement in which a company meets the operating requirement set by another company, and obtains the right to sell its products and use its name.
is an agreement that grants foreign marketers the right to distribute goods and use marketing tools in a specific geographic area.
A firm with significant operations and marketing activities outside its home country is called a
The top executives at your international company have debated for months about implementing their previously successful global marketing strategy in a new country. A vocal contingent is holding out for customizing the approach and putting in place a multidomestic marketing strategy. As the director of marketing, you know that whichever way they decide to do business, you will proceed in a logical manner to roll out the marketing effort in the new country.
Below are the steps that are involved in the management of a marketing strategy implementation initiative, whether standardized or customized. In what order should they be carried out?
Determine which activities can be done in house and which need to be outsourced locally.
Prioritize the marketing activities to be performed.
Assign responsibility for completing each activity.
Use performance metrics to evaluate the venture’s success.
Wait for decision about using customized or existing approaches.
Wait, Prioritize, Determine, Assign, Use.
Andreas founded a successful book publishing company in his native Ireland. He now has contracts in a dozen countries. When he joined Publishing Ireland, a professional association, he found that Irish publishers only account for about 20% of book sales in Ireland itself. He is working with his colleagues to change that picture. His position is that both an individual company and the entire nation benefit from the results of global sales. Each level provides different benefits.
Which of the following results of global sales is(are) not an individual company benefit?
Providing needed raw materials, manufacturing equipment, and expert personnel not locally available.
Opening new, previously untapped, markets to serve with a wide variety of domestic outputs
Marketers must make significant adjustments to their marketing strategies when targeting international markets. The strategies must be adjusted to fit the differences in components of the foreign environment. A successful international marketing strategy requires a careful environmental analysis to understand the needs and desires of customers outside the United States.
Which of the following statements about international marketing scenarios is(are) correct?
Foreign buyers’ perceptions of other countries can influence product adoption and use. This is a sociocultural component of the marketing environment.
The degree of freedom of access to the Internet and a country’s overall communications infrastructure will affect the marketing mix. This is a technological component of the marketing environment.
Language barriers will affect the marketing mix. This is a sociocultural component of the marketing environment.
The gross domestic product and inflation rate in a country will affect marketing strategies. This is an economic component of the marketing environment.
You are the marketing manager for a small Spanish sunglasses start-up manufacturer. Today the CEO saw pictures of Hollywood stars in Barcelona making a movie, and wearing your company’s sunglasses. Original plans for entry into the U.S. were scheduled for a year away. But the CEO has said, “We need to be in the U.S. now! Time is of the essence!”
Which marketing mix approach will you immediately implement?
There are three levels of involvement in global marketing and two ways to look at each level. The marketer can examine the degree of control that the company would have over the marketing effort and classify it as low, moderate, or high. Another way of looking at a similar situation is to classify the degree of risk for the company as being low, moderate, or high.
Which of the following levels of involvement in global marketing would generally be considered to have both high risk and high control?
You are an independent marketing contractor working for the mother-daughter founders of a European company making unique Egyptian cotton bedding items. They are considering expanding their firm’s sales to the U.S. They ask you to help them choose the strategy that would best suit their working styles. You have interacted with both of them long enough to know that they have a decided inclination to micro-manage.If they do not have a way to make all the final decisions, they will be totally frustrated.
Which marketing strategy to expand into the U.S. market are you going to recommend to them?
Directly investing in an American location to sell Egyptian cotton bedding items