Marketing CH 13, MKT Chapter 13

T/F: A marketing channel is a business structure composed of interdependent organizations that reach from the point of product origin to the final consumer.
true
T/F: As products move through the marketing channel, channel members provide specialization and division of labor, overcome discrepancies, and provide contact efficiency.
true
T/F: A consumer stopped by the convenience store to buy a bag of charcoal briquettes. She only needs one bag, but the manufacturer produces millions of bags. For consumers, the convenience store overcomes a discrepancy of dimensions.
false
T/F: Residents of Sobarro, New Mexico, live in an isolated area of the state. Residents must travel two hours to receive medical treatment. Luckily, a physician has just opened a new practice in Sobarro. In this case, the physician has overcome service discrepancies by opening an office close to consumers.
false
T/F: Consider a scenario in which there are four manufacturers, no intermediaries, and three consumers. Twelve transactions would be required for each consumer to receive products from each manufacturer. The introduction of one intermediary reduces the required number of transactions to four and demonstrates the idea of contact efficiency.
false
T/F: A merchant wholesaler is an institution that buys goods from manufacturers and resells them to businesses, government agencies, and other wholesalers or retailers.
true
T/F: Carl represents a manufacturer of floor coverings and gets paid a commission for finding buyers and linking them up with the manufacturer. Carl is an example of a merchant wholesaler.
false
T/F: The three basic functions a channel intermediary provides are transactional, logistical, and facilitating functions.
true
T/F: The logistical functions performed by intermediaries include physically distributing, storing, sorting, and financing.
false
T/F: Harriet Lowe makes children’s clothing, which she sells at craft festivals to end users. Lowe does not use channel intermediaries, which means she uses a direct channel.
true
T/F: The direct channel is used more often in consumer markets than in business-to-business markets.
false
T/F: LoneStar Bar & Grill is a small chain of restaurants that feature marinated steaks. The marinade is so popular that LoneStar sells it at its restaurants and Kroger supermarkets. This is an example of intensive distribution.
false
T/F: Metallurgical Designs makes gold and silver charms for necklaces and bracelets. It markets its charms to a few retailers in any one region and promotes them intensively to those retailers. This is an example of intensive distribution.
false
T/F: Shopping goods are usually distributed selectively. Consumers are willing to look around for them but may not be willing to search or travel extensively to acquire the product.
true
T/F: Exclusive distribution is the most extensive form of market coverage.
false
T/F: At one end of the channel relationship continuum is the “arm’s-length” relationship.
true
T/F: Highly integrated channel relationships are the preferred relationship because there is no large outlay of assets required to keep the channel members all working toward the same results.
false
T/F: Integrated channel relationships tend to be more flexible than cooperative relationships.
false
T/F: An international consumer products manufacturer requires all of its suppliers to provide the lowest possible cost and to adhere to a just-in-time inventory system. Wholesalers and manufacturers generally yield to the authority of this large manufacturer. This consumer products manufacturer exercises channel power.
true
T/F: Reciprocal conflict occurs among channel members on the same level, such as two or more different wholesalers or two or more different retailers that handle the same manufacturer’s brands.
false
T/F: Many regard vertical conflict as healthy competition.
false
T/F: Because distribution creates the same problems whether it is in Ethiopia, Indonesia, or Venezuela, you will find that channel structures and types around the world are very similar to those in the United States.
false
T/F: Gray marketing channels assist brand name manufacturers in marketing their products more efficiently.
false
T/F: Unlike marketers of physical products, marketers of services do not have to address the question of logistics since services do not require a distribution strategy.
false
T/F: When discussing the distribution of services, you will often hear channel members discussing the need to minimize wait times.
true
A _____ is a business structure of interdependent organizations that reaches from the point of product origin to the consumer.
a. facilitating agency or place member
b. marketing mix intermediary
c. selective distribution channel
d. marketing channel or channel of distribution
e. transportation channel or channel of movement
D
Jones Soda is positioned as the anti-Coke. In the early years, few mainstream retailers sold Jones Soda. Fans had to get their Jones fix in surf shops, tattoo parlors, and bookstores, adding to the brand’s mystique. Jones Soda used its _____ to create a competitive advantage.
a. channel ascendancy
b. distribution channel
c. channel conflict
d. channel focus
e. vertical integration
B
Kayak.com is a company that allows customers to efficiently search databases to find the best airline and hotel deals all over the Web. Kayak does not make bookings but rather provides recommendations for the best travel plans. Travel providers pay Kayak a commission when customers click through to their sites. Kayak.com, travelers, the airlines, and the hotels are all part of a:
a. facilitating agency
b. marketing mix intermediary
c. selective promotion channel
d. marketing channel or channel of distribution
e. transportation channel or channel of movement
D
Marketing channels can achieve economies of scale through:
a. overcoming spatial discrepancies
b. contact expertise
c. specialization and division of labor
d. overcoming temporal discrepancies
e. overcoming discrepancies of quantity
C
Distribution channels aid in overcoming barriers to exchange that are created in the production process by overcoming all of the following types of discrepancies EXCEPT:
a. possession
b. assortment
c. quantity
d. spatial
e. temporal
A
A discrepancy of _____ is the difference between the amount of product produced and the amount an end user wants to buy.
a. space
b. quantity
c. assortment
d. accumulation
e. possession
B
Kraft Foods produces millions of packages of Chips Ahoy cookies each year, but consumers only want to purchase one package at a time. This difference between the amount Kraft produces and the amount a consumer wants to buy is referred to as a:
a. discrepancy of quantity
b. discrepancy of assortment
c. spatial discrepancy
d. temporal discrepancy
e. discrepancy of possession
A
Which of the following is the lack of all the items a customer needs to receive full satisfaction from a product or products?
a. Discrepancy of assortment
b. Discrepancy of quantity
c. Spatial discrepancy
d. Temporal discrepancy
e. Discrepancy of possession
A
McKesson Wholesalers provides healthcare products to pharmacies. It purchases bandages, gauze, antibacterial cream, and ointments from a variety of different manufacturers and resells them to pharmacies so that many of the items a customer might need for a cut will be available in the store. McKesson is aiding consumers by overcoming a:
a. spatial discrepancy
b. discrepancy of quantity
c. discrepancy of assortment
d. demand discrepancy
e. discrepancy of possession
C
Certified Grocers Midwest, Inc., the Chicago-based grocery wholesale cooperative, provides all kinds of meats, cereals, canned and fresh fruits and vegetables, beauty aids, healthcare items, and pet products to the supermarkets in its channel. Certified Grocers is aiding consumers by overcoming:
a. spatial discrepancy
b. discrepancy of quantity
c. discrepancy of assortment
d. demand discrepancy
e. discrepancy of possession
C
A(n) _____ discrepancy is created when a product is produced but a consumer is not ready to purchase it.
a. quantity
b. supply
c. possession
d. temporal
e. assortment
D
Cutter & Buck is a high-end fashion sportswear company. Even though swimwear is a product category that does not sell year-round, its sales remain steady all year because Cutter & Buck sells to wholesale distributors that stock the product. Its wholesale distributors are helping to overcome a(n) _____ discrepancy.
a. assortment
b. spatial
c. possession
d. quantity
e. temporal
E
Vicobello is a major manufacturer of outdoor fountains that are popular in gardens. Even though fountains represent a product category that does not sell year-round due to inclement weather, Vicobello’s sales remain steady all year because it sells to wholesale distributors that stock the product. Its wholesale distributors are primarily helping to overcome a(n) _____ discrepancy.
a. assortment
b. spatial
c. possession
d. quantity
e. temporal
E
The difference between the location of a producer and the location of widely scattered markets represents a(n) _____ discrepancy.
a. spatial
b. temporal
c. assortment
d. quantity
e. ownership
A
YKK slide fasteners (zippers) are made in Macon, Georgia, yet manufactures all over the world use zippers to manufacture, clothes, luggage, shoes, and other items. Wholesalers around the world primarily help to overcome a(n) _____ discrepancy.
a. creation
b. temporal
c. assortment
d. spatial
e. ownership
D
Marketing channels make distribution simpler by reducing the number of transactions required to get products from manufacturers to consumers. This is called:
a. forward integration
b. contact efficiency
c. elimination of temporal discrepancies
d. sorting
e. reciprocity
B
When an intermediary in the channel of distribution owns the merchandise and controls the terms of the sale, this is referred to as:
a. complete control
b. exclusive distribution
c. taking title
d. contact efficiency
e. economies of scale
C
The major characteristic that is used to differentiate among types of intermediaries is whether they:
a. install exchange barriers such as location, time, and quantity
b. create specialization of labor
c. create economies of scale
d. take title to the products they sell
e. raise profit margins for independent middlemen
D
Retailers and merchant wholesalers are examples of intermediaries that:
a. take title to a product
b. create temporal and spatial discrepancies
c. use consumer promotions
d. do not benefit from any economies of scale
e. are accurately described by all of these statements
A
Which of the following intermediaries sell mainly to consumers?
a. Retailers
b. Merchant wholesalers
c. Agents
d. Brokers
e. Specialists
A
A(n) _____ is an institution that buys goods from manufacturers, takes title to these goods, and resells them to businesses, government agencies, and/or other wholesalers or retailers.
a. merchant wholesaler
b. agent
c. drop shipper
d. channel cooperative
e. marketing cooperative
A
W.W. Grainger, Inc., is one of the world’s largest business-to-business distributors of equipment, component parts, and supplies in the United States and Canada. It has ownership title to over 220,000 products, which are stocked in one national and nine regional warehouses to guarantee product availability and quick service to the many manufacturers who are its customers. W.W. Grainger is an example of a(n):
a. agent or broker
b. merchant wholesaler
c. retailer
d. consumer market
e. hypermarket intermediary
B
Long Island Lefty provides retailers and other businesses with the latest and the best products for left-handed consumers. It buys all types of products from a variety of manufacturers and stores the merchandise in its New York warehouse until purchased by buyers. Long Island Lefty does not sell to end users and is an example of a(n):
a. agent or broker
b. merchant wholesaler
c. retailer
d. consumer market
e. hypermarket intermediary
B
Agents and brokers:
a. have a great deal of control and risk invested in the goods
b. only represent manufacturers in sales situations
c. have a great deal of input on the terms of the sale
d. generally are on salary with the manufacturer
e. do not take title to merchandise
E
_____ are intermediaries who facilitate the sales of a product from producer to end user by representing retailers, wholesalers, or manufacturers and providing little input as to the terms of the sale.
a. Marketing facilitators
b. Channel cooperatives
c. Agents and brokers
d. Merchant wholesalers
e. Channel functionaries
C
Generally, _____ determine what type of intermediary a manufacturer should use:
a. product characteristics, buyer consideration, and market characteristics
b. only internal environmental characteristics
c. competitive conditions and government regulations
d. all controllable marketing factors
e. only noncontrollable environmental factors
A
The three basic functions channel intermediaries perform are:
a. transactional, logistical, and facilitating
b. contacting, negotiating, and ownership
c. promoting, distributing, and bulk-breaking
d. assorting, accumulating, and allocating
e. financing, mediating, and storing
A
Which of the following is a transactional function performed by intermediaries?
a. Sorting
b. Researching
c. Risk taking
d. Physically distributing
e. Storing
C
Transactional channel functions include all of the following activities EXCEPT:
a. contacting buyers
b. promoting the products to be sold
c. taking the risks associated with product inventories
d. negotiating the sale
e. physical distribution and sorting
E
Which of the following is a logistical function performed by intermediaries?
a. Sorting
b. Negotiating
c. Financing
d. Risk taking
e. All of these choices
A
Marketing channels perform all of the following logistical activities EXCEPT:
a. sorting
b. storing
c. physically distributing
d. risk taking
e. breaking bulk
D
All of the following are sorting activities EXCEPT:
a. assorting
b. accumulation
c. sorting out
d. allocation
e. possession
E
Breaking bulk at the wholesale level is called:
a. allocating
b. accumulation
c. storing
d. downsizing
e. grading
A
With respect to the sorting logistical function, _____ is the combining of similar stocks into a larger homogeneous supply.
a. sorting out
b. accumulating
c. allocating
d. breaking bulk
e. assorting
B
Which of the following are examples of facilitating functions performed by wholesaling intermediaries?
a. Sorting and storing
b. Risk taking and promotion
c. Assorting, accumulating, grading, and allocating
d. Researching and financing
e. Financial management and storing
D
_____ is the efficient and cost-effective forward and reverse flow and storage of goods, services, and related information into, through, and out of channel member companies.
a. Disintermediation
b. Logistics
c. Materials handling
d. Intermodal transportation
e. Contract logistics
B
_____ describes the process of strategically managing the efficient flow and storage of raw materials, in-process inventory, and finished goods from point of origin to point of consumption.
a. Contract logistics
b. Logistics
c. Cross-docking
d. Disintermediation
e. Channel facilitation
B
Serenity is a manufacturer of outdoor fountains that are popular in gardens. Even though fountains represent a product category that does not sell year-round due to inclement weather, Serenity’s sales remain steady all year because it sells to wholesale distributors that stock the product. Serenity sells to wholesale distributors that perform _____ functions for the manufacturer.
a. financial
b. transactional
c. facilitating
d. logistical
e. promotional
D
One configuration of a marketing channel entails producers selling to consumers with no intermediaries involved. This is called a:
a. limited distribution system
b. conventional channel
c. vertical marketing system
d. reciprocal channel
e. direct channel
E
The only way that Jim Keeler in New Mexico can get a box of Carolyn Popwell’s Festive Holiday Truffles from Washington is to order it through the mail. Popwell, who makes the candy by hand, uses a(n) _____ exclusively.
a. exclusive distribution system
b. conventional channel
c. vertical marketing system
d. reciprocal channel
e. direct channel
E
All of the following are typical channel members in marketing channels for consumer products EXCEPT:
a. retailers
b. agent/brokers
c. industrial distributors
d. producers
e. wholesalers
C
Vutek manufactures printing machines used to print high-resolution graphics for billboards, bus cards, banners, and posters. For distribution, you would expect Vutek to use a:
a. network of facilitating agents
b. horizontally integrated channel
c. reciprocal channel
d. direct channel
e.vertical marketing system
D
Centigon is a manufacturer of customized armored vehicles for military, private, presidential, and commercial uses. Each armored vehicle is designed to deliver security on the road while also achieving optimum levels of performance and comfort. For distribution, you would expect Centigon to use a:
a. network of facilitating agents
b. horizontally integrated channel
c. reciprocal channel
d. direct channel
e. vertical marketing system
D
Companies selling standardized items of moderate or low value to other businesses (not to consumers) often use:
a. retailers
b. industrial distributors
c. wholesalers
d. bulk breakers
e. industrial resellers
B
_____ distribution occurs when a producer selects two or more different channels to distribute the same products to target markets.
a. Selective
b. Intensive
c. Dual
d. Contractual
e. Cumulative
C
Customers can purchase Hewlett-Packard computers from retail stores like Best Buy and Office Depot, online directly from HP, and through various catalogs. HP is using a(n) _____ distribution arrangement.
a. intensive
b. multiple
c. exclusive
d. cumulative
e. aggregated
B
Which of the following enables a company to use another manufacturer’s already established channel?
a. Strategic channel alliances
b. Relationship channels
c. Reverse channels
d. Multiple distribution systems
e. Nontraditional channelization
A
Selfridges is the second-largest department store in Great Britain. It works with House of Frasier, one of its competitors, to reduce operating costs by sharing channels of distribution to ship goods from 1,500-plus suppliers. Selfridges and House of Frasier are engaged in:
a. vertical conflict
b. an integrated supply chain
c. a strategic channel alliance
d. an information-based distribution channel
e. a distribution cooperative
C
When Delphi-Grundig, a manufacturer of state-of-the-art car radios, decided to expand its marketing efforts into countries in which its products are not currently available, it did not have the time or resources to spend on developing new channels of distribution. Delphi-Grundig should consider a(n):
a. industrial distributor
b. franchising system
c. reverse channel
d. strategic channel alliance
e. channel cooperative
D
Which of the following statements concerning how market factors affect channel decisions is true?
a. Industrial customers tend to buy in larger quantities and require more customer service.
b. Geographically concentrated target markets should be served with an indirect sales force.
c. Widely dispersed markets require fewer intermediaries.
d. New firms in extremely competitive markets will be more successful if they use indirect channels.
e. A very large market requires fewer intermediaries.
A
Canesta Company has developed a virtual keyboard out of light to be used with cell phones and PDAs. The product beams an image of a keyboard on a desk, allowing the user to type on the image. The words are picked up by the user’s digital device. When introduced to the market, the device will sell for less than $50. If, in choosing its channel, Canesta is most concerned about the life cycle of the device, then its choice of channels will largely be influenced by:
a. factors of production
b. customer characteristics
c. ownership factors
d. product factors
e. market factors
D
Canesta Company has developed a virtual keyboard out of light to be used with cell phones and PDAs. The product beams an image of a keyboard on a desk, allowing the user to type on the image. The words are picked up by the user’s digital device. When introduced to the market, the device will sell for less than $50. If, in choosing its channel, Canesta is most concerned about its lack of financial, managerial, and marketing resources to support the product’s introduction, then its choice of channels will largely be influenced by:
a. factors of ownership
b. market factors
c. producer factors
d. product factors
e. internal environmental characteristics
C
_____ is distribution aimed at maximum market coverage. It is used for many convenience goods and supplies that need to be available in every outlet where the potential customer might want to buy them.
a. Selective distribution
b. Channel franchising
c. Intensive distribution
d. Horizontal channeling
e. Exclusive distribution
C
Chewing gum and soft drinks are sold in grocery stores, service stations, convenience stores, drugstores, discount stores, and motel vending machines. This is a an example of a(n) _____ distribution strategy.
a. exclusive
b. reciprocal
c. selective
d. horizontal
e. intensive
E
Which of the following manufacturers most likely uses intensive distribution?
a. M&M’s candies
b. Jen-Weld windows
c. Calloway golf clubs
d. Rollerblade in-line skates
e. Smith & Wesson firearms
A
_____ distribution is achieved by screening dealers to eliminate all but a few in any single geographic area. Shopping goods and some specialty products that consumers are willing to search for are sold this way.
a. Intensive
b. Selective
c. Exclusive
d. Dual
e. Controlled
B
Husqvarna Viking manufactures sewing machines. The company carefully screens its dealers to ensure a quality dealer image and service ability. Only a few dealers are chosen in any single geographic area. This is an example of _____ distribution.
a. dual
b. intensive
c. exclusive
d. selective
e. controlled
D
Canesta Company has developed a virtual keyboard out of light to be used with cell phones and PDAs. The product beams an image of a keyboard on a desk, allowing the user to type on the image. The words are picked up by the user’s digital device. When introduced to the market, the device will sell for less than $50. What level of distribution intensity should the company use?
a. Exclusive
b. Controlled
c. Extensive
d. Reciprocal
e. Selective
E
Polo brand apparel is only available in fine department stores or from Polo retail stores. Which distribution strategy has Polo adopted?
a. Extensive
b. Intensive
c. Premium
d. Selective
e. Pioneering
D
Which level of distribution intensity is the most restrictive and entails establishing only one or a few dealers within a given geographic area?
a. Selective
b. Intensive
c. Exclusive
d. Dual
e. Premium
C
Rolex is an expensive brand of watches. The company has a policy of only having one or two dealers within a given large geographic area. Buyers of Rolex watches will travel extensively to acquire just the right watch. This is an illustration of which level of distribution intensity?
a. Exclusive
b. Intensive
c. Selective
d. Reciprocal
e. Premium
A
Caterpillar, the manufacturer of tractors and other earthmoving equipment, has an extremely high market share, which means customers seek the dealers out regardless of where they are. There are approximately 50 Caterpillar dealers in the United States–one in each state. From this information, you can surmise that Caterpillar uses _____ distribution.
a. selective
b. premium
c. intensive
d. exclusive
e. inclusive
D
Which of the following types of distribution channel relationships is considered to be temporary?
a. Arm’s length
b. Functional
c. Cooperative
d. Hierarchical
e. Integrated
A
This summer, college student Pat is planning on selling kites at Panama City Beach. He has found some suppliers and has preordered all of the kites he thinks he can sell this summer. What type of a distribution channel relationship does Pat have with his suppliers?
a. Arm’s length
b. Functional
c. Cooperative
d. Hierarchical
e. Integrated
A
With the _____ channel relationship, both parties retain their independence and pursue their own interests while attempting to benefit from the goods or services provided by the other.
a. arm’s-length
b. functional
c. cooperative
d. hierarchical
e. integrated
A
_____ distribution channel relationships are situations where one company, or several companies acting as one, performs all channel functions.
a. Arm’s-length
b. Functional
c. Cooperative
d. Hierarchical
e. Integrated
E
One of the earliest, largest, and most famous examples of vertical integration was the Carnegie Steel Company. The company controlled not only the mills where the steel was manufactured but also the mines where the iron ore was extracted, the coal mines that supplied the coal, the ships that transported the iron ore, and the railroads that transported the coal to the factory. Carnegie Steel had a(n) _____ channel relationship.
a. arm’s-length
b. functional
c. cooperative
d. hierarchical
e. integrated
E
_____ channel relationships include nonequity agreements such as franchising and licensing as well as equity-based joint ventures and strategic alliances.
a. Arm’s-length
b. Functional
c. Cooperative
d. Hierarchical
e. Integrated
C
Which channel relationship is less ambiguous than an arm’s-length relationship but without the longer-term and/or capital investment required to achieve full integration?
a. Negotiated
b. Functional
c. Cooperative
d. Hierarchical
e. Intermediate
C
In 1935, Howard Johnson teamed up with Reginald Sprague to establish the first modern restaurant franchise. Their idea was to let independent operators use the same name, food, supplies, logo and even building design in exchange for a fee. In terms of the type of channel relationships established, this nonequity agreement would require a _____ relationship.
a. negotiated
b. functional
c. cooperative
d. hierarchical
e. segregated
C
Some countries, such as the Peoples Republic of China and to some extent India, require foreign companies to form joint ventures with domestic firms in order to enter a market. This requirement often forces technology transfers and managerial control to the domestic partner. These types of equity agreements also require the establishment of a(n) _____ channel relationship.
a. arm’s-length
b. functional
c. cooperative
d. hierarchical
e. integrated
C
The capacity of a particular marketing channel member to control or influence the behavior of other channel members is known as:
a. channel power
b. channel conflict
c. channel control
d. channel dominance
e. channel inversion
A
Wal-Mart is the largest retailer in the world, and many consumer packaged-goods manufacturers like Kraft have offices in Bentonville, Arkansas, where Wal-Mart is headquartered. Wal-Mart has the ability to influence manufacturers to lower their prices so that it can deliver on its low-price guarantee to consumers. Wal-Mart possesses:
a. channel influence
b. channel supremacy
c. channel power
d. channel exclusivity
e. channel clout
C
A situation that occurs when one marketing channel member intentionally affects another member’s behavior is called:
a. channel power
b. channel control
c. channel conflict
d. channel dominance
e. channel inversion
B
A channel leader is also called a(n):
a. intermediary leader
b. channel captain
c. channel facilitator
d. distribution supervisor
e. channel gatekeeper
B
DeBeers sells most of the diamonds it produces to industry. The company controls over 90 percent of the market and has great power over its distributors. In its marketing channel, DeBeers would be considered a:
a. channel authority
b. channel member
c. channel leader
d. channel gatekeeper
e. power broker
C
Johns Manville is the only manufacturer to offer a complete line of formaldehyde-free fiberglass building insulation, which offers superior energy efficiency in hard-to-reach cathedral ceilings and flat roof cavities; plus it is an excellent sound control for interior floors. As the only manufacturer and patent holder of this revolutionary insulation, Johns Manville has great power over its dealers. It is an example of a:
a. channel authority
b. channel regulator
c. channel captain
d. channel gatekeeper
e. power broker
C
Channel conflict:
a. always has an adverse effect on the members of the channel
b. is not caused by ideological differences, because such differences would prevent the members from ever operating as a channel
c. is often caused by an inability of some channel members to keep up with the changing times
d. can appear as either internal or external
e. does not occur when multiple distribution channels are used
C
Almost a million fans are willing to buy subscriptions to watch Major League Baseball (MLB) games online at MLB.com. That business is worth more than $100 million to MLB. But this online broadcast takes those fans away from the broadcasters that pay MLB hundreds of millions of dollars for the right to carry the games. Which of the following is likely to occur between MLB and broadcast television?
a. Horizontal market share
b. Lateral channel takeover
c. Niche market conflict
d. Channel conflict
e. Market share conflict
D
Honda uses just-in-time manufacturing to build its Odyssey minivans. Five companies that make component parts for the Honda Odyssey relocated to Alabama and states bordering Alabama when Honda announced plans to build a new Odyssey manufacturing plant in Alabama. This relocation in order to provide efficient delivery of goods indicates that Honda is a:
a. channel captain
b. horizontal integrator
c. distribution champion
d. distribution ombudsman
e. demand maverick
A
Channel conflict that occurs among channel members on the same level is known as:
a. primary conflict
b. organic conflict
c. internal conflict
d. horizontal conflict
e. vertical conflict
D
Horizontal channel conflict occurs most often when manufacturers practice:
a. dual or multiple distribution
b. trade loading
c. promotional pricing
d. direct distribution
e. channel distribution
A
Goodyear tire dealers were hurt financially when Goodyear made the decision to distribute its tires through retailers such as Sears and Walmart in addition to the exclusive dealerships it had established. The conflict that occurred at the retail level is an example of:
a. horizontal conflict
b. trade loading
c. value-added pricing
d. exclusive distribution
e. channel partnering
A
Channel conflict that occurs between different levels in a marketing channel is referred to as:
a. horizontal conflict
b. primary conflict
c. vertical conflict
d. secondary conflict
e. parallel conflict
C
Polo brand apparel can be purchased through fine department stores nationwide. However, Polo apparel can also be purchased through Polo stores, which creates the potential for _____ conflict in the channel of distribution.
a. primary
b. secondary
c. horizontal
d. vertical
e. parallel
D
_____ is the joint effort of all channel members to create a channel that serves customers and creates a competitive advantage.
a. Selective partnering
b. Direct distribution
c. Channel partnering
d. Intensive integration
e. Closed channel distribution
C
_____ occurs when products are distributed through unauthorized marketing channels.
a. Black marketing
b. Countertrading
c. Channel malfeasance
d. Gray marketing
e. Reverse channeling
D
Many large champagne sellers do their own importing and desire to maintain independent price points in different markets. Thus, a bottle of champagne might cost $45 in the United States, while the same bottle might be only 20 euros (about $30) in France. It is often profitable to buy the wine in Europe, typically from an unauthorized distributor, and resell it in the United States. U.S. wine merchants who do so would be engaging in:
a. black marketing
b. channel malfeasance
c. countertrading
d. reverse channeling
e. gray marketing
E
It seems counterintuitive, but Jon Jordan, CEO of Southern Audio Services (SAS) in Baton Rouge, wants to curb the number of dealers who are selling his car speakers. Jordan understands that he can’t handpick all his vendors, but he never expected the rise in unauthorized dealers that came with the e-commerce boom. When Jordan decided to look for the SAS name on eBay, he came up thousands of sellers. These eBay sellers are engaging in:
a. black marketing
b. channel malfeasance
c. countertrading
d. reverse channeling
e. gray marketing
E
One thing that sets service distribution apart from traditional manufacturing distribution is that in a service environment:
a. production and consumption are simultaneous
b. production setbacks can be remedied by using safety stock
c. faster modes of transportation can offset service production problems
d. service distribution benefits are more tangible
e. service distribution has a narrower focus
A
Which of the following businesses is most likely to have a problem with distribution because production and consumption of the product occurs simultaneously?
a. A company that manufacturers bicycles
b. A hair salon
c. A retailer that sells mattresses
d. A soft drink bottler
e. A wholesaler that specializes in athletic equipment
B
You are responsible for physical distribution of your company’s service and should focus on:
a. ensuring the intangibility of the service so that physical distribution becomes a less important factor
b. minimizing wait times, managing service capacity, and providing delivery through distribution channels
c. making sure production and consumption are simultaneous
d. setting quality standards, choosing faster transportation modes, and using safety stock
e. customer-oriented order processing and inventory control
B
Which of the following is a main area of concern for service distribution?
a. Minimizing wait times
b. Maximizing sales
c. Creating a one-to-one relationship with customers
d. Providing easy to use Internet help
e. Reducing risk
A
Paul operates Kayak.com, a company that allows customers to efficiently search company databases and find the best airline and hotel deals all over the Web. Kayak does not make bookings but rather provides recommendations for the best travel plans. Travel providers pay Kayak a commission for most customers who click through to their sites. Paul wants his users to have as short and sweet an experience on Kayak as possible. Time is of the essence in responding to any customer question, especially in this day where airfare can increase dramatically in just a couple of hours. Paul is devoted to:
a. improving service delivery
b. maximizing queues
c. reducing discrepancies of assortment
d. reducing wait time
e. managing service capacity
A
Refer to R. H. Kurt & Son. Its marketing channel is composed of:
a. the distribution, objectives, strategies, and tactics used to move products from the manufacturer to the retailer
b. any organization that had a part in moving the product from the distributor to the retailer
c. the functions of transportation, storage, inventory control, materials handling, and order processing
d. the 41 different manufacturers, R. H. Kurt, the retailers it serves, and their customers
e. all organizations in the industry that make it possible for a consumer to buy his or her desired product
D
Refer to R. H. Kurt & Son. Customers at retail stores only want one rifle or one scope. They do not want to buy in the quantities the manufacturers need to sell. This _____ is overcome by the marketing channels.
a. discrepancy of quantity
b. spatial discrepancy
c. discrepancy of assortment
d. discrepancy of facilitation
e. discrepancy of possession
A
Refer to R. H. Kurt & Son. When Kurt combines products from 41 different manufacturers into a collection retail buyers want available at one place, it is engaging in:
a. a transactional function
b. creating an assortment
c. a facilitating function
d. integrating its promotional functions
e. compressed distribution
B
Refer to R. H. Kurt & Son. When Kurt solicits an order from a sporting goods store, it engages in a _____ function.
a. logistical
b. functional
c. facilitating
d. customerized
e. transactional
E
Refer to R. H. Kurt & Son. Given the nature of the products carried by Kurt, what level of distribution intensity would be most appropriate?
a. Extensive
b. Intensive
c. Reflexive
d. Unitary
e. Selective
E
Refer to R. H. Kurt & Son. If Kurt wishes to make sure its gunsmith service is profitable, it must consider:
a. how it can minimize the time a customer must wait for his or her rifle to be repaired
b. how the opening of hunting season will affect demand for its services
c. how to maintain an adequate staff
d. whether to ship the repaired rifle to the customer or the retailer
e. all of these options
E
Refer to Redbox. Warner Bros., Blockbuster, Redbox, Walmart, and third-party DVD distributors are part of a:
a. distribution cooperative
b. marketing mix
c. transportation channel
d. marketing channel
e. logistics system
D
Refer to Redbox. Redbox offers DVDs from several production studios, such as Disney, Sony, and Paramount. Consumers can rent from Redbox instead of obtaining the DVD from the various production studios if they want a children’s movie from Disney and an action movie from Paramount. Thus, one kiosk provides _____ for both consumers and the production studios.
a. contact efficiency
b. integration
c. synergy
d. distribution efficiency
e. distribution intensity
A
Refer to Redbox. Video stores that distribute DVDs usually also sell popcorn, candy, soft drinks, and entertainment publications. Basically, they overcome discrepancies of quantity and assortment by combining products into collections or assortment that consumers want available in one place. Which channel function does this describe?
a. Logistical functions
b. Transactional functions
c. Facilitating functions
d. Purchasing functions
e. Secondary functions
A
Refer to Redbox. Production studios distribute DVDs in grocery stores, drugstores, discount stores, entertainment stores, and vending machines like Redbox. Which level of distribution intensity does this represent?
a. Intensive
b. Extensive
c. Product focused
d. Market focused
e. Exclusive
A
Refer to Redbox. Production studios are potentially producing _____ among its existing distributors by allowing Redbox to rent their DVDs for $1.00.
a. vertical conflict
b. cognitive dissonance
c. supply management divergence
d. horizontal conflict
e. disintermediation
D
Sampling error
_____ occurs when a sample somehow does not represent the target population.
Observation
_____ research depends on watching what people do
nonprobability
A _____ sample is any sample in which little or no attempt is made to obtain a
representative cross section of the population.
probability
A(n) _____ sample is characterized by every element in the population having a
known statistical likelihood of being selected.
reduced measurement error
All of the following are advantages associated with the use of Internet surveys
EXCEPT:
secondary
Data previously collected for purposes other than the one at hand are an important
source of information as the researcher defines the problem. These data are called ____ date.
primary
Information collected for the first time for the purpose of solving a particular problem
under investigation is called _____ data.
the perceived costs are greater than the projected benefits.
Marketing research should NOT be undertaken when:
observation research.
Mystery shoppers engage in a form of:
survey research
The most popular method for gathering primary data is _____, in which a researcher
interacts with people to obtain facts, opinions, and attitudes.
Convenience
_____ products are purchased with little shopping effort. These products typically are
purchased regularly, usually with little planning, and require wide distribution.
trademark
A _____ is a legal term indicating the owner’s exclusive right to use a brand name or
part of a brand.
brand
A _____ is a name, term, symbol, design, or combination thereof that identifies a
seller’s products and differentiates them from competitors’ products
product
A _____ is everything, both favorable and unfavorable, that a person receives in an
exchange. It can be tangible, intangible, a service, an idea, or a combination of these
things.
private
A(n) _____ brand is one owned by the wholesaler or retailer.
product line extension.
Adding additional products to an existing product line in order to compete more
broadly in the industry is referred to as:
product
The _____ is the starting point in creating a marketing mix
individual
When a company uses different brand names for different products, it is using _____
branding.
the product name is no longer recognized as the exclusive property of one firm
When a product name becomes generic:
Co-branding
Which of the following entails placing two or more brand names on a product or its
package?
Innovators
_____ are eager to try new ideas and products. They typically have higher incomes,
are better educated, and are more cosmopolitan than other categories of adopters.
Early adopters
_____ embrace products relatively early in the product life cycle, are likely to be
community oriented, and often are opinion leaders themselves.
Test marketing
_____ is a limited introduction of a product and a marketing program to determine the
reactions of potential customers in a market situation.
Brainstorming
_____ is a process where a group thinks of as many ways to vary a product or solve a
problem as possible without considering the practicality of the ideas.
Decline
A long-run drop in sales signals the beginning of which stage in the product life cycle?
doubters
All of the following are categories of adopters in the diffusion process of innovations
EXCEPT:
development
In the _____ stage of new-product development, the technical feasibility of
manufacturing the new product is examined as a prototype is produced
a good match between the product and market needs
The MOST important factor in successful new-product introduction is:
late majority
The _____ adopt a product because most of their friends have already done so, and
their adoption is usually the result of pressure to conform because they rely on group
norms.
False
Adaptation is the process by which the adoption of an innovation spreads.
Supply chain management
_____ coordinates and integrates all of the activities performed by channel members
into a seamless process, from the source to the point of consumption, resulting in
enhanced customer and economic value.
Supply chain integration
_____ occurs when all the firms and business units participating in the supply chain
appear as though they are reading from the same script.
diversity
All of the following are criteria used to choose a mode of transportation EXCEPT:
trade promotions
All of the following are part of a sequence of “source, make, and deliver,”
EXCEPT:
Safety stock
_____ is an extra allotment of inventory that companies sometimes choose to
hold in the event that demand spikes, or if forecasts regarding the amount of
demand are too low
Selective
_____ distribution is achieved by screening dealers to eliminate all but a few in any
single geographic area. Shopping goods and some specialty products that consumers
are willing to search for are sold this way.
Retailing
_____ is defined as all activities directly related to the sale of goods and services to the
ultimate consumer for personal, nonbusiness use or consumption.
contact efficiency
Marketing channels make distribution simpler by reducing the number of transactions
required to get products from manufacturers to consumers. This is called:
Exclusive
Which level of distribution intensity is the most restrictive and entails establishing
only one or a few dealers within a given geographic area?
take title to the products they sell
The major characteristic that is used to differentiate among types of intermediaries is
whether they:
Supply Chain
connected chain of all of the business entities, both internal and external to the company, that perform or support the logistics function
Supply Chain Managment
management system that coordinates and integrates all of the activities performed by supply chain members into a seamless process, from the source to the point of consumption, resulting in enhanced customer and economic value
Supply Chain Agility
operational strategy focused on creating inventory velocity and operational flexibility simultaneously in the supply chain
Supply Chain Orientation
a system of management practices that are consistent with a “systems thinking” approach
Supply Chain Integration
when multiple firms or business functions in a supply chain coordinate their activities and processes so that they are seamlessly linked to one another in an effort to satisfy the customer
Demand-supply Integration (DSI)
supply chain operational philosophy focused on integrating the supply-management and demand-generating functions of an organization
Business Processes
bundles of interconnected activities that stretch across firms in the supply chain
Customer Relationship Management Process (CRM)
allows companies to prioritize their marketing focus on different customer groups according to each group’s long-term value to the company or supply chain
Customer Service Management Process
presents a multi-company, unified response system to the customer whenever complaints, concerns, questions, or comments are voiced
Demand Management Process
seeks to align supply and demand throughout the supply chain by anticipating customer requirements at each related plans of action prior to actual customer purchasing behavior
Order Fulfillment Process
highly integrated process, often requiring persons from multiple companies and multiple functions to come together and coordinate to create customer satisfaction at a given place and time
Order Cycle Time
time delay between the placement of a customer’s order and the customer’s receipt of that order
Manufacturer Flow Management Process
concerned with ensuring that firms in the supply chain have the needed resources to manufacture with flexibility and to move products through a multi-stage production process
Supplier Relationship Management Process
supports manufacturing flow by identifying and maintaining relationships with highly valued suppliers
Product Development and Commercialization Process
includes the group of activities that facilitates
the joint development and marketing of new offerings among a group of supply chain partner firms
Returns Management Process
enables firms to manage volumes of returned product efficiently while minimizing returns-related costs and maximizing the value of the returned assets to the firms in the supply chain
Sustainable Supply Chain Management
supply chain management philosophy that embraces the need for optimizing social and environmental costs in addition to financial costs
Outsourcing (contract logistics)
manufacturer’s or supplier’s use of an independent third party to manage an entire function of the logistics system, such as transportation, warehousing, or order processing
Third Party Logistics Company (3PL)
firm that provides functional logistics services to others
Fourth-party Logistics Company (4PL or logistics integrator)
consulting-based organization that assesses another’s entire logistical service needs and provides integrated solutions, often drawing on multiple 3PLs for actual service
Offshoring
the outsourcing of a business process from one country to another for the purpose of gaining economic advantage
Nearshoring
transfer of an offshored activity from a distant to a nearby country
Public-private Partnerships (PPPs)
Critical to the satisfaction of both company and societal interests and provide a mechanism by which very-large scale problems or opportunities can be addressed
Electronic Distribution
distribution technique that includes any kind of product or service that can be distributed electronically, whether over traditional forms such as fiber-optic cable or through satellite transmission of electronic signals
Three-dimensional Printing (3DP)
creation of three-dimensional objects via an additive manufacturing (printing) technology that layers raw material into desired shapes
Big Data
rapidly collected and difficult-to-process large-scale datasets that have recently emerged, and which push the limits of current analytical capability
Cloud Computing
practice of using remote network servers to store, manage, and process data
Supply Chain Analytics
data analyses that support the improved design and management of the supply chain
Marketing Channel ((channel of distribution)
set of interdependent organizations that eases the transfer of ownership as products move from producer to business user or consumer
Channel Members
all parties in the marketing channel who negotiate with one another, buy and sell products, and facilitate the change of ownership between buyer and seller in the course of moving the product from the manufacturer into the hands of the final consumer
Form utility
elements of the composition and appearance of a product that make it desirable
Time Utility
e increase in customer satisfaction gained by making a good or service available at the appropriate time
Place Utility
usefulness of a good or service as a function of the location at which it is made available
Exchange Utility
increased value of a product that is created as its ownership is transferred
Merchant Wholeslaer
institution that buys goods from manufacturers and resells them to businesses, government agencies, and other wholesalers or retailers and that receives and takes title to goods, stores them in its own warehouses, and later ships them
Agents and Brokers
wholesaling intermediaries who do not take title to a product but facilitate its sale from producer to end user by representing retailers, wholesalers, or manufacturers
Retailer
channel intermediary that sells mainly to consumers
Direct Channel
distribution channel in which producers sell directly to consumers
Dual Distribution (multiple distribution)
use of two or more channels to distribute the same product to target markets
Nontraditional channels
non-physical channels that facilitate the unique market access of products and services
Strategic Channel Alliance
cooperative agreement between business firms to use the other’s already established distribution channel
Gray Marketing Channel
secondary channels that are unintended to be used by the producer, and which often flow illegally obtained or counterfeit product toward customers
Reverse Channels
channels that enable customers to return products or components for reuse or remanufacturing
Drop and Shop
system used by several retailers that allow customers to bring used products for return or donation at the entrance of the store
Digital Channels
electronic pathways that allow products and related information to flow from producer to consumer
M-commerce
ability to conduct commerce using a mobile device for the purpose of buying or selling goods or services
Intensive Distribution
form of distribution aimed at having a product available in every outlet where target customers might want to buy it
Selective Distribution
form of distribution achieved by screening dealers to eliminate all but a few in any single area
Exclusive Distribution
form of distribution that establishes one or a few dealers within a given area