Marketing Practice Exam 2

business marketing
The marketing of goods and services to companies, governments, or not-for-profit organizations for use in the creation of goods and services that they can produce and market to others, is referred to as __________.

integrated marketing
institutional marketing
business marketing
reseller marketing
organizational marketing

an industrial market
A business market is also referred to as

a transactional market.
a corporate market.
a government market.
a reseller market.
an industrial market.

organizational buyers
Manufacturers, wholesalers, retailers, and government agencies that buy goods and services for their own use or for resale are referred to as

multinational buyers.
resellers.
organizational buyers.
ultimate consumers.
institutional buyers.

Wholesalers and retailers resell the goods they buy without reprocessing them.
Which of these statements regarding organizational buyers is most accurate?

Wholesalers and retailers resell the goods they buy without reprocessing them.

Wholesalers and retailers alter the goods they sell to meet the specific needs of their customers prior to resale.

Manufacturers purchase processed goods and resell them to suppliers who in turn resell them to ultimate consumers.

Ultimate consumers can be considered organizational buyers when they purchase in large quantities.

Government agency purchases are more similar to ultimate consumer purchases than they are to wholesalers and retailers.

ultimate consumers
All of the following are organizational buyers EXCEPT:

industrial firms.
government units.
ultimate consumers.
resellers.
wholesalers.

industrial, reseller, and government.
Organizational buyers can be divided into three different markets, which are

industrial, wholesaler, and retailer.
industrial, retailer, and government.
retailer, manufacturer, and government.
industrial, government, and ultimate consumer.
industrial, reseller, and government.

The owner of a sushi restaurant hires a window washing service to clean exterior windows.
Which of the following represents an organizational buyer?

A local baker buys sugar at the grocery store to make cookies with his children at home.

A dentist buys a new LG SmartTV 55-inch 3D OLED HDTV for her den.

Mr. Langley hires a housecleaning service to clean his apartment.

The owner of a sushi restaurant hires a window washing service to clean exterior windows.

The city mayor rents a tuxedo to wear to his daughter’s wedding.

industrial firm
A firm that reprocesses a product or service it buys before selling the product again to the next buyer is referred to as a(n)

industrial firm.
reseller firm.
government agency.
wholesaler.
retailer.

industrial markets
Mining companies, farms, financial services, and fisheries are all examples of

consumer markets.
cooperative markets.
reseller markets.
industrial markets.
government markets.

industrial
Keystone Foods, which invented the individual quick freeze process for beef, provides McDonald’s with millions of pounds of chicken, beef, and fish annually for use in its restaurants. The firm sources the animal proteins from farms and processes them in a variety of ways, such as breading or freezing, before selling them to McDonald’s. Keystone is operating in a(n) __________

market.
consumer
government
service
industrial
reseller

retailers and wholesalers
The reseller market includes

manufacturers.
logistics and supply chain providers.
government agencies.
end-user service providers.
retailers and wholesalers.

reseller
European Style Furniture (ESF), headquartered in New York, acquires fine furniture from several high quality manufacturers in Europe and enjoys exclusive distribution rights from them to sell to furniture stores throughout the U.S. In this context, ESF is most likely classified as a

producer.
reseller.
service provider.
government agency.
industrial firm.

fewer customers but with larger orders
Important market characteristics in organizational buying behavior include which of the following?

unlimited markets but orders become progressively smaller over time

diminishing international opportunities as more firms enter the market

many customers placing progressively larger orders over time

fewer customers but with larger orders

a market that functions independently of consumer demand

A heavy emphasis is placed on delivery time, technical assistance, and postsale service.
Important product or service characteristics in organizational buying include which of the following?

Products or services that are technical in nature and purchased on the basis of specifications.

A heavy emphasis is placed on delivery time, technical assistance, and postsale service.

Direct selling to organizational buyers is rare.
A fixed, nonnegotiable price is the norm.

Personal relationships are preferred to online buying over the Internet.

delivery time, technical assistance, and postsale service.
In the organizational buying process, important product or service characteristics include

delivery time, technical assistance, and postsale service.
low price, buyer incentives, and extended contracts.
buyer incentives, technical assistance, and exclusive contracts.
quantity discounts, delivery time, and exclusive contracts.
low price, buyer incentives, and post-sale service.

the demand for industrial products and services that is driven by the demand for consumer products and services.
Derived demand refers to

a graph relating the quantity sold and price, which shows the maximum number of units that will be sold at a given price.
the demand for industrial products and services that is driven by the demand for consumer products and services.
the relationship between total revenue and total cost to determine profitability at various levels of output.
the point on a demand curve where supply and demand intersect.
the percentage change in quantity demanded relative to a percentage change in price.

derived
Purchases of sodium fluoride by Procter & Gamble for use in the manufacture of Crest toothpaste would be an example of __________ demand.
applied
unitized
industrial
derived
consumer
derived
South Cape Ostrich Tanning (SCOT) is a producer of fine ostrich leathers, which are sold to manufacturers that make a variety of products from shoes to car interiors. Demand for SCOT’s leather is a result of consumer interest in products like Via La Moda handbags made from this exotic and expensive leather. SCOT has __________ demand for its product.
derived
unitized
industrial
applied
reseller
get competitive bids from at least three prospective suppliers
Because orders in organizational buying are typically much larger than in consumer buying, buyers must often __________ when the order is above a specific amount, such as $5,000.
pay estimated sales taxes in advance
move up the time required to execute a purchase agreement
get competitive bids from at least three prospective suppliers
forgo the purchase because senior management is unlikely to approve it
forgo identifying the members of the supplying center and their roles in the selling process
the size of the purchase involved in organizational buying is typically smaller than that in consumer buying but it is done more frequently.
All of the following statements about the purchase involved in organizational buying are true EXCEPT:
the length of time required to arrive at a purchase agreement can vary with size of purchase.
the dollar value of a single purchase made by an organization often runs into thousands or millions of dollars.
the size of purchase impacts who participates in the purchase decision.
the size of purchase impacts who makes the final decision.
the size of the purchase involved in organizational buying is typically smaller than that in consumer buying but it is done more frequently.
are restricted to far fewer buyers.
Firms selling consumer products or services often try to reach thousands or millions of individuals or households. Firms selling to organizations
try to reach tens of millions of wholesalers, retailers, and government units.
are restricted to far fewer buyers.
hope to obtain similar numbers of business customers, or even more.
do not have customers, per se.
simultaneously purchase from organizational buyers and ultimate consumers.
achieve its own objectives
An organization buys products and services for one main reason, which is to
achieve its own objectives.
beat its competitors.
satisfy the needs of its suppliers.
employ people.
maintain inventory.
help the firm achieve its objectives
The primary organizational buying objective for business firms is to
create an atmosphere of inclusiveness.
help smaller companies stay in business.
increase the proficiency of its buyers.
help the firm achieve its objectives.
balance inventory.
increase profits through reducing costs or increasing revenues.
The primary buying objective for business firms is usually to
increase profits through increasing costs and increasing revenues.
increase profits through reducing costs and decreasing revenues.
increase profits through reducing costs or increasing revenues.
maintain profits through reducing costs and increasing revenues.
reduce profits through reducing costs and reducing revenues.
the objective attributes of the supplier’s products and services and the capabilities of the supplier itself.
Organizational buying criteria refer to

the restrictions placed on potential solutions to a problem in a purchase decision.
the specific qualifications of a potential customer based upon past performance, reliability, and consistency regarding the purchase of an organization’s offerings.
the subjective attributes of the supplier’s products and services and the capabilities of the supplier itself.
the objective attributes of the supplier’s products and services and the capabilities of the supplier itself.
the factors that an ultimate consumer would consider that represent both the objective attributes of a brand and the subjective ones to compare different products and brands.

evaluative
Organizational buying criteria serve the same purpose as __________ criteria used by consumers.
consideration
evaluative
decision
alternative
prepurchase
price
There are seven commonly used organizational buying criteria. One of them is __________.
price
loyalty
flexibility
adaptability
consumer demand
ability to meet the quality specifications required for the item
There are seven commonly used organizational buying criteria. One of them is __________.
flexibility
ability to meet the quality specifications required for the item
adherence to government regulation
senior management directives
consumer demand
ability to meet required delivery schedules
There are seven commonly used organizational buying criteria. One of them is __________.
adaptability
consumer demand
ability to meet required delivery schedules
senior management directives
adherence to corporate social responsibility policies
technical capability
There are seven commonly used organizational buying criteria. One of them is __________.
consumer demand
longevity
promotional incentives
technical capability
senior management directives
warranties and claim policies
There are seven commonly used organizational buying criteria. One of them is __________.
consumer demand
promotional incentives
longevity
senior management directives
warranties and claim policies
past performance on previous contracts
There are seven commonly used organizational buying criteria. One of them is __________.
adherence to governmental policies
regulatory support
past performance on previous contracts
consumer demand
senior management directives
Purchases are often made after lengthy or complex negotiations.
Which of the following characterizes organizational buyer-seller relationships?
Purchases are often made after lengthy or complex negotiations.
Purchases are usually of small dollar values.
Short-term contracts are often prevalent.
Reciprocal arrangements are illegal.
Delivery schedules are less important than production capacity.
long term contracts are often prevalent
Which of the following characterizes organizational buyer-seller relationships?
Purchases are often made after brief negotiations.
Purchases are usually of small dollar values.
Long-term contracts are often prevalent.
Reciprocal arrangements are prohibited by the federal government.
Delivery schedules are largely irrelevant.
buying center
The group of people within an organization who participate in the buying process and share common goals, risks, and knowledge important to a purchase decision is referred to as the
gatekeeper.
buying center.
purchasing department.
procurement committee.
acquisition office.
specifiers
All of the following are roles in a buying center EXCEPT:
specifiers.
deciders.
buyers.
influencers.
users.
buying center
In an effort to make better and more efficient purchase decisions, the Ford Motor Company includes various people in them, depending on the purchase situation. Individuals may include key personnel from various departments, including research and development, finance, marketing, shipping, and sales. This is a description of Ford’s __________.
selling committee
sustainable procurement department
purchasing unit
buying center
buying committee
product champions
As shown in buying center photo above, an organization’s buying center includes individuals who can play one or more of the following roles EXCEPT:
gatekeepers.
deciders.
buyers.
product champions.
influencers.
users
The people in the organization who actually use the product or service are referred to as __________, which is one role in the buying center.
consumers
deciders
buyers
influencers
users
user
On a visit to Conner Industries, a West Plains Band Saw salesperson heard a production employee saying, “This band saw has a 36-inch wheel that could really save us time, and with its adjustable height, it can be operated by someone tall like me as well as by our shorter workers. I bet this would speed up my production time by 30 percent. Why don’t we order this band saw?” The person the salesperson heard giving input has which buying center role?
purchasing agent
decider
buyer
user
motivator
influencers
In a buying center, __________ affect the buying decision, usually by helping define the specifications for what is bought.
gatekeepers
deciders
buyers
influencers
users
affect the buying decision usually by helping define the specifications for what is bought.
Within the buying center, influencers are people who
have the formal authority and responsibility to select the supplier and negotiate the terms of the contract.
control the flow of information in the buying center.
affect the buying decision usually by helping define the specifications for what is bought.
have the formal or informal power to select or approve the supplier that receives the contract.
actually use and evaluate the product or service.
buyers
In a buying center, __________ have formal authority and responsibility to select the supplier and negotiate the terms of a contract.
buyers
gatekeepers
adopters
influencers
users
buyer
The purchasing manager of Ingram Printing has selected HP as the supplier of its new high-speed printer and negotiated the terms of the contract. The purchasing manager is the __________ for Ingram.
user
gatekeeper
influencer
buyer
decider
deciders
In a buying center, __________ have the formal or informal power to select or approve the supplier that receives the contract.
gatekeepers
deciders
buyers
influencers
users
have the formal or informal power to select or approve the supplier that receives the contract.
Within the buying center, deciders are people who
have the formal authority and responsibility to select the supplier and negotiate the terms of the contract.
control the flow of information in the buying center.
have the formal or informal power to select or approve the supplier that receives the contract.
affect the buying decision usually by helping define the specifications for what is bought.
actually use and evaluate the product or service.
the buyer or purchasing manager.
For routine orders, the decider is usually
the buyer or purchasing manager.
the CEO.
the COO.
the head of R&D.
the customer.
decider
An IT engineer specifies the type of electronic shopping cart to be used on the company’s new website. The engineer also chooses the supplier who receives the contract to provide the software. In the buying center, this person is the __________.
gatekeeper
decider
broker
influencer
user
gatekeeper
People who control the flow of information in the buying center, such as technical experts and secretaries, can keep salespeople and information from reaching others in the buying center and are referred to as __________.
deciders
obstructionists
gatekeepers
power-brokers
influencers
gatekeeper
A sales representative for a pharmaceutical company visits the doctor’s office, hoping to explain a new drug to the doctor. However, the office receptionist explains that the doctor is with patients and will not be able to see the sales rep. The receptionist is acting as a(n) __________.
user
influencer
buyer
decider
gatekeeper
gatekeeper
Beth is part owner of a chain of auto repair shops. Her company was considering adding tire sales in some of its facilities, and several people were slated to meet to discuss the idea. Beth gathered information about possible distributors. Her son had been laid off from a job with one of them, so she removed this company from the group she was preparing to present to the others. Here, Beth was acting in what role in the buying center?
gatekeeper
decider
user
obstructionist
power-broker
influencer, gatekeeper, and decider
Mark manages a small family-owned amusement park. He believes the park can increase its profits if its owners will buy three food concession trailers. Mark has contacted three dealers of such trailers, which come fully customized to user specifications. After receiving three bids, Mark concluded that Century Industries has the best offer. He will present only the Century Industries information to the family tomorrow. What buying center roles does Mark perform?
gatekeeper and buyer
decider and user
buyer and decider
influencer and buyer
influencer, gatekeeper, and decider
traditional auction
When a seller puts an item up for sale and would-be buyers are invited to bid in competition with each other, it is referred to as a(n) __________.
reverse auction
traditional auction
bidder’s war
e-auction
Webfront auction
traditional auction
Dell, Inc. sells surplus, refurbished, or closeout computer merchandise at its dellauction.com website to many buyers who bid competitively against one another. This is an example of a
traditional auction.
reverse auction.
bidder’s war.
I-auction.
Webfront auction.
traditional auction
As shown in Figure 5-6A above, what type of online auction does one seller and many buyers typify?
forward auction.
reverse auction.
traditional auction.
vertical auction.
bidder’s war.
increases
In a traditional auction, as the number of buyers increases, the price
increases.
decreases.
stays the same.
has no relation to the number of buyers.
fluctuates depending on economic conditions.
reverse auction
In an e-marketplace, an online auction in which a buyer communicates a need for a product or service and would-be suppliers are invited to bid in competition with each other is referred to as a
vertical auction.
reverse auction.
horizontal auction.
traditional auction.
reciprocal auction.
in which a buyer communicates a need for a product or service and would-be suppliers are invited to bid in competition with each other.
A reverse auction refers to an online auction
where firms may sell their overstock – unused raw materials, packaging, and tools – to the highest bidder.
in which a manufacturer offers to share its facilities, inventory, or services with other smaller firms that are invited to bid in competition with each other.
in which a smaller manufacturer seeks to share the facilities, inventory, or services of a larger firm, and invites those firms to bid in competition with each other.
in which a buyer communicates a need for a product or service and would-be suppliers are invited to bid in competition with each other.
where firms seek to purchase other firms’ overstock – unused raw materials, packaging, and tools – while trying to find the lowest price possible.
put downward pressure on prices.
Reverse auctions
are seller-initiated.
benefit the sellers significantly more than the buyers.
have an increasing number of buyers as the auction progresses.
put downward pressure on prices.
have many buyers.
are buyer-initiated
Reverse auctions
are buyer-initiated.
benefit the sellers significantly more than the buyers.
have an increasing number of buyers as the auction progresses.
do not allow sequential bidding.
have many buyers at the start of the auction.
reverse auction
what type of online auction does one buyer and many sellers typify?
forward auction.
reverse auction.
traditional auction.
vertical auction.
bidder’s war.
decreases
In a reverse auction, as the number of sellers increases, the price
increases.
stays the same.
has no relation to the number of sellers.
decreases.
fluctuates depending on economic conditions.
marketing research
Movie studios use tracking studies in which prospective moviegoers are asked questions about an upcoming film release to help them forecast sales. This is an example of
movie advertising.
marketing research.
tactical support.
cross-movie research.
movie audits.
reduce uncertainty and improve marketing actions.
Test screenings and tracking studies are examples of market research techniques used in the movie industry to
estimate a production company’s potential market share.
identify prospective nominees for industry awards such as the Oscars.
create an advance market for the movie’s DVD release regardless of whether it is successful in its theater release or not.
identify possible story lines and/or plots for future movie ventures.
reduce uncertainty and improve marketing actions.
marketing research
The process of defining a marketing problem and opportunity, systematically collecting and analyzing information, and recommending actions is referred to as __________.
marketing enquiry
strategic intelligence
data mining
marketing tactics
marketing research
Will consumers accept a small gratuity for participating in a market research study for a new or existing product?
All of the following are challenges marketers face when conducting marketing research EXCEPT:
Will consumers’ actual purchase behaviors match their stated interests or intentions?
Will consumers reveal honest answers to questions about personal or status issues?
Will consumers buy the same brand they say they will?
Will consumers accept a small gratuity for participating in a market research study for a new or existing product?
Will consumers really know whether they are likely to buy a new product that they have never thought about before?
When collecting marketing research, people may not be willing to tell you what you want to know if it is potentially embarrassing.
Which of the following statements concerning marketing research is most accurate?

The primary purpose of marketing research is to collect data for historical purposes.
When collecting marketing research, people may not be willing to tell you what you want to know if it is potentially embarrassing.
Marketing research, if done properly, will always result in a positive marketing result.
People are just as able to give accurate information about products they have only heard about as those they have actually used.
Among those people who participate in market research studies, there is an almost perfect correlation between a respondent’s stated intentions and his/her actual buying behavior.

do marketing research to identify what needs were not being satisfied.
Grape-Nuts was one of the first cereals Post Cereal Company ever marketed. It scores well in brand awareness studies, but recently its sales have been steadily declining. Rather than assume the product was a “dog,” the Grape-Nuts marketing manager decided Post should first
update the flavor of the cereal by making it slightly sweeter.
increase the amounts spent on advertising and sales promotion.
do marketing research to identify what needs were not being satisfied.
hire additional salespeople who were younger and more assertive to contact grocery stores.
realign Grape-Nuts as a “star” and increase production.
marketing research
Members of the Book Promoters Association of Canada recently questioned what could be done to rejuvenate the Canadian book publishing industry. Some claimed the problem was that many Canadian bookstores had been replaced by Amazon.com. Others said the problem was stodgy advertising. Still others believed the problem small budgets for marketing programs. The best way to identify the problem would be to use __________.
market analysis
marketing management
a marketing audit
marketing research
data mining
define the problem
The first step of the marketing research approach is to __________.
develop findings
define the problem
take marketing actions
collect relevant information
develop the research plan
develop the research plan
The second step of the marketing research approach is to __________.
develop findings
define the problem
take marketing actions
develop the research plan
collect relevant information
collect relevant information
The third step of the marketing research approach is to __________.
develop findings
define the problem
take marketing actions
develop the research plan
collect relevant information
develop findings
The fourth step of the marketing research approach is to __________.
develop findings
define the problem
take marketing actions
develop the research plan
collect relevant information
define the problem
Setting research objectives and identifying possible marketing actions that might result from the research would take place during which step of the five-step marketing research approach?
collect relevant information
develop the research plan
develop findings
obtain secondary data
define the problem
develop the research plan
Specifying constraints, identifying data needed for marketing actions, and determining how to collect data would take place during which step of the five-step marketing research approach?
collect relevant information
develop the research plan
develop findings
take marketing actions
define the problem
collect relevant information
Obtaining primary and secondary data would take place during which step of the five-step marketing research approach?
collect relevant information
develop the research plan
develop findings
take marketing actions
define the problem
develop findings
Analyzing data and presenting the results of this analysis would take place during which step of the five-step marketing research approach?
collect relevant information
develop the research plan
develop findings
take marketing actions
define the problem
take marketing actions
Making recommendations, implementing those recommendations, and evaluating the results would take place during which step of the five-step marketing research approach?
collect relevant information
develop the research plan
develop findings
take marketing actions
define the problem
collect relevant information
Obtaining primary and secondary data would take place during which stage of the five-step marketing research approach?
define the problem
develop the research plan
collect relevant information
develop findings
take marketing actions
It took a systematic approach to analyzing the problem and responded to its advertisers’ concerns.
Watch was a teen publication given out free to high school students, but the publication was unable to deliver the response rates to coupons or sample offers that its advertisers expected. After defining the marketing problem, its publisher developed a research plan, gathered information from teen focus groups, analyzed the findings, and replaced Watch magazine with Fuel for boys and Verve for girls. How would a marketer judge the publisher’s actions?
Why fix something that is not broken? The magazine was still attracting some advertisers.
It made a big deal out of a small decline – a few copy changes would have been enough.
The approach it took was too complicated and costly to provide an effective solution to the problem.
It took a systematic approach to analyzing the problem and responded to its advertisers’ concerns.
This publisher used an approach that works for corporations but will just waste time for a small publisher.
define the problem
Several years ago, SwissAir made some unwise investments to pay for a planned expansion. As a result, the company had to make some cost-cutting moves that alienated its customers. Eventually, the company declared bankruptcy, regrouped, and found itself able to resume business. Its board of directors recently announced that the company would resume flying if it could prove that the airline could regain at least 75 percent of its lost customers. It decided to allocate $50,000 to determine the likelihood that its former customers would fly on the airline again and find methods requiring little or no money that could be used to increase that probability. This description represents which step in the marketing research approach?
define the problem
develop the research plan
collect relevant information
develop findings
take marketing actions
set the research objectives
There are two key elements when defining a marketing research problem. One of these is __________.
specify constraints
set the research objectives
determine how to collect data
evaluate previous research results
identify data needed for marketing actions
criteria or standards used in evaluating proposed solutions to a problem.
Measures of success refer to
the goals the decision maker seeks to achieve in solving a problem.
criteria or standards used in evaluating proposed solutions to a problem.
identification of acceptable alternatives for collecting data to solve a problem.
objective data used to identify the most profitable solution to a marketing problem.
subjective data used to identify the most profitable solution to a marketing problem.
assembly time
Consider the LEGO MINDSTORMS photo above. LEGO designers created MINDSTORMS kits to appeal to middle-school students, among others. When attempting to choose between potential designs, what was the measure of success for use by LEGO in this instance?
age
gender
assembly time
cost
advertising
introduce design B
Consider the LEGO MINDSTORMS photo above. If the marketing research measure of success is assembly time for a particular design meant for middle-school students, which would be the best possible marketing action if the results of a marketing research study concluded, “All ten teams could assemble Design B in 20 minutes but only 3 teams completed Design A”?
redesign the kits so that assembly time is more uniform
introduce design B
introduce the Design A, but add more new features to charge a higher price
mine the data further for student reactions
consult the marketing dashboards to analyze LEGO sales in the U.S.
measure of success
When Home Depot entered the Quebec market in Canada, two percent of people were aware of the retail chain. To determine advertising effectiveness during the first 18 months in Quebec, awareness research was done a second time. For this research, it was decided that if at least 50 percent of a 600-person sample of the population were aware of the Home Depot brand, it would continue its present advertising program. This is an example of a(n)
objective.
constraint.
assumption.
measure of success.
barrier to entry.
specify constraints
There are three key elements when developing a marketing research plan. One of these is __________.

specify constraints
set the research objectives
determine how report the findings
evaluate previous research results
identify data needed for marketing actions

determine how to collect data
There are three key elements when developing a marketing research plan. One of these is __________.

specify the objectives
evaluate previous research results
determine how to collect data
identify possible marketing actions
identify data needed for marketing actions

develop the research plan
Specifying constraints, identifying data needed for marketing actions, and determining how to collect data, would all take place during which step of the five-step marketing research approach?
define the problem
develop the research plan
collect relevant information
develop findings
take marketing actions
develop the research plan
The retail mall owner told the marketing researcher, “We have the option of staying open late twice a week or opening up an hour early every day. We need to know which will be most profitable since we cannot do both. The decision must be made in 11 weeks and we only have $10,000 budgeted for this research project.” In which step of the marketing research process would the owner determine this budget and time frame?
define the problem
develop the research plan
collect relevant information
develop findings and recommendations
take marketing actions
limitations on the time and money available
What are the two most common constraints in marketing problem solving?
limitations of personnel and office space
limitations of the strategic thinking and creativity of the firm’s advertising agency
limitations on the time and money available
government regulations and rights to privacy
limitations on access to upper and middle management
selecting representative elements from a population and treating their answers as typical of all those in whom they are interested.
In marketing research, the term sampling refers to
testing the effectiveness of a marketing alternative in a supervised setting.
the collection of various secondary data through electronic or mechanical means.
allowing a subject to experience first-hand a new or updated product or service.
selecting representative elements from a population and treating their answers as typical of all those in whom they are interested.
testing members from all ages, both genders, and different levels of income and education to guarantee reliable information.
sampling
The process of selecting elements from a population, collecting data from them, and using it as representative of all those a researcher is interested in is referred to as
hypothesis generation.
sampling.
information gathering.
statistical inference.
probability extrapolation.
statistical inference
The method of __________ involves generalizing the results from the sample to much larger groups of distributors, customers, or prospects to help decide on marketing actions.
nonprobability sampling
probability sampling
extrapolation
statistical inference
criteria sampling
statistical inference
Drawing conclusions about a population from a sample taken from that population is referred to as
nonprobability sampling
statistical inference
probability sampling
extrapolation
criteria sampling
statistical inference
The National Health Interview Survey is conducted annually by the Centers for Disease Control and Prevention. By examining information gathered from a national sample of 600 respondents throughout the U.S., it was able to announce that 14.1 percent of all Americans lacked healthcare insurance. To make this statement, the Centers for Disease Control and Prevention had to use
focus groups.
no constraints.
internal secondary data.
statistical inference.
interpolation.
collecting relevant information
GI Design is a small studio that designs and builds items such as fountains and tabletops made from copper. To increase sales, Greg, the owner, developed a research plan to determine what landscape architects and interior designers wanted in copper furnishings and appropriate pricing. He had begun to interview representative designers. Greg was engaged in __________, the third step of the five-step marketing research approach.
developing the research plan
solving the problem
developing findings and recommendations
collecting relevant information
taking marketing actions
primary and secondary
The two main types of data are
independent and dependent.
primary and secondary.
comprehension and case specific.
extraneous and experimental.
measurable and non-measurable.
government publications
All of the following are sources of primary data EXCEPT:
government publications.
observational data.
experiments.
social media.
panels.
secondary data
Facts and figures that have already been recorded before the project at hand are referred to as
primary data.
empirical data.
secondary data.
demographic data.
observational data.
internal secondary data; external secondary data
Secondary data can be divided into two parts – __________ and __________.
primary data; empirical data
empirical data; secondary data
tertiary data; demographic data
demographic data; observational data
internal secondary data; external secondary data
secondary data
Children’s accessory and toy store Red Carpet Baby! uses U.S. Census Bureau information to determine the number of families with children under age 5 for each state in its market area. Data obtained from this source are called __________.
proprietary data
primary data
secondary data
observational data
experimental data
primary data
Facts and figures that are newly collected for a project at hand are referred to as
statistical data.
empirical data.
secondary data.
primary data.
inferential data.
primary data
Observing people and asking them questions are the two principal ways to obtain
external secondary data.
internal secondary data.
primary data.
experimental independent variables.
nonprobability data.
internal secondary data.
When a marketing researcher uses a collection of reports, customer letters, financial statements, and surveys from different departments within her firm to make marketing decisions today, she is using
internal secondary data.
primary data.
external secondary data.
sensitivity analysis.
probability data.
accounting records.
All of the following are examples of marketing input data EXCEPT:
advertising budgets.
call reports.
accounting records.
sales budgets.
advertising expenses.
salespeople’s call reports.
All of the following are examples of marketing outcome data EXCEPT:
customer phone calls.
repeat sales reports.
accounting records.
salespeople’s call reports.
sales reports by geographic region.
external secondary
Published data from outside the organization are referred to as __________ data.
proprietary
external primary
internal secondary
internal primary
external secondary
Economic Census
The U.S. Census Bureau publishes the __________, which is conducted every five years and contains detailed information on the number and sales of U.S. establishments that produce goods or resources.
North American Industry Classification System
Economic Census
Annual Survey of Manufacturers
Annual Wholesale Trade Survey
Survey of Business Owners
Economic Census
The 2012 __________ contains data on the number and sales of establishments in the United States that produce a product or service based on its geography, industry sector, and North American Industry Classification code.
Annual Retail Trade Survey
Annual Survey of Manufacturers
Economic Census
Annual Wholesale Trade Survey
Service Annual Survey
household demographics
When customers have their groceries scanned at the supermarket checkout counter, the data are collected and processed by tracking services such as IRI’s InfoScan. Consumer product firms like Procter and Gamble use data collected by IRI to allocate scarce marketing resources. Which of the following data are NOT collected at retail checkout counters?
coupon redemptions
product bar codes
product sales
free sample redemptions
household demographics
external secondary
When Karsh and Hagan Advertising Agency uses information found in Nielsen Television Index Ranking Report published by Nielsen Media Research to plan television advertising schedules for its clients, it is relying on __________ data.
neuromarketing
primary
internal secondary
observational
external secondary
external secondary data.
According to research conducted by Canadian cultural anthropologists, Canadians place a high importance on personal relationships. This leads them to be extremely reluctant to buy through an impersonal medium like a telephone. For an insurance company that was hoping to sell insurance through telemarketers, this research would be an example of
internal secondary data.
a constraint.
an assumption.
a dependent variable.
external secondary data.
observational
Mechanical, personal, or neuromarketing methods are ways that __________ data can be collected.
virtual
primary source
hypothetical
observational
statistical
observational
Fisher-Price watches young children play with its toys to determine if and how various products should be changed or improved. Fisher Price is collecting __________ data.
observational
questionnaire
interview
on-site
focus group
observational data
Nielsen Media Research collects national TV ratings by using a “people meter.” This is a box that is attached to TV sets, VCRs, DVRs, cable boxes, and satellite dishes in about 20,000 households across the country. A viewer uses the remote to signal the people meter that he or she is watching a TV program. The box then transmits the viewing information to the Nielsen Company. The information Nielsen is collecting is referred to as __________.
internal secondary data
interactive industry data
sensitivity data
external secondary data
observational data
combine its new online ratings with its existing TV ratings.
The purpose of Nielsen Media Research’s “cross-platform television ratings” is to
expand its scope to include the effectiveness of online college courses.
expand its scope to include satellite radio programming.
combine its new online ratings with its existing TV ratings.
expand its business to a global market.
gain access to every American home that owns a television, mobile phone, or computer.
mechanical observational data
National TV ratings, collected with a “people meter” and published by Nielsen Media Research, are an example of __________ data.
internal secondary data
interactive industry data
external secondary data
mechanical observational data
sensitivity data
mystery shoppers
People posing as customers, who are paid to check on the quality of a company’s products and services and write a detailed report on the experience, are referred to as __________.
mystery shoppers
customer ombudsmen
secret customers
Facebook “likers”
repeat customers
who pose as customers to check on a firm’s products or services and are paid to write a detailed report on their experiences.
Mystery shoppers are people
hired by a firm to get legal, though not necessarily ethical, information about competitive firms.
hired by a firm’s employees to prove to the courts that competitors are using unfair pricing practices.
hired by a customer to report on illegal or unethical practices that are regularly taking place at a particular establishment.
who pose as customers to check on a firm’s products or services and are paid to write a detailed report on their experiences.
hired by law firms to check on the safety of their clients’ products.
observational
Melanie manages a local store for a national drug store chain, and had received complaints from several customers about rude employees. To check on her customer service, Melanie hired a team of researchers, who posed as customers shopping in the store. Occasionally, they bought something, but their primary purpose was to take notes and record the actions of the service staff. The research notes Melanie received were a form of __________ data.
secondary
developmental
observational
national
questionnaire
neuromarketing.
The field of marketing that studies the brain and its response to marketing stimuli is referred to as
extrapolation.
hypothesizing.
neuromarketing.
deduction.
conjecture.
neuromarketing
What type of marketing uses brain scanning to analyze the buying processes of research participants?
subliminal marketing
permission marketing
ultrasense marketing
optimization marketing
neuromarketing
questionnaire data
The facts and figures obtained by asking people about their attitudes, awareness, intentions, and behaviors are referred to as
primary data.
secondary data.
statistical inference.
observational data.
questionnaire data.
individual interview
The most common way of collecting questionnaire data to generate ideas, which involves a single researcher asking questions of one respondent, is referred to as a(n)
panel.
focus consultation.
individual interview.
face-to-face exchange.
interactional interview.
individual interviews.
Where it is desirable for the interviewer to be flexible in asking probing follow-up questions, data would be best collected using
mail surveys.
mechanical observations.
fax surveys.
individual interviews.
on-line surveys.
individual interviews
Marine Midland Bank sent market researchers door-to-door in the neighborhoods surrounding its branch banks. Each researcher wanted to spend 15 minutes talking with a head of the household about his or her savings accounts to discuss why he or she did not also have checking accounts and credit cards with the bank. Marine Midland researchers were using __________ to collect these data.
secondary interviews
individual interviews
intercept interviews
observational data collection
ethnographic research
depth interview.
A special kind of individual interview in which researchers ask lengthy, free-flowing kinds of questions to probe for underlying ideas and feelings is called a(n)
focus group.
discovery interview.
probing interview.
guided interview.
depth interview.
a focus group.
A marketing research approach that uses a discussion leader to interview 6 to 10 past, present, or prospective customers simultaneously is referred to as
a depth interview.
data mining.
a research team.
a focused interview.
a focus group.
focus group
The Minnesota Twins, a professional baseball team, wanted to develop creative ways to boost sagging attendance at its ball games. The Twins hired a moderator who, after every home game during the month of July, led informal discussions with groups of 6 to 10 fans to find out what they did and did not like about the baseball team and their experience at the stadium. Discussions were videotaped for later review. These informal research sessions are called
experiments.
secondary data.
focus groups.
panels.
depth interviews.
open-ended
A(n) __________ question allows respondents to express opinions, ideas, or behaviors in their own words without being forced to choose among alternatives that have been predetermined by a marketing researcher.
dichotomous
open-ended
closed-end
fixed-alternative
semantic differential
open-ended
“Why do you smoke cigarettes?” is an example of which type of question?
Likert scale
fixed alternative
dichotomous
open-ended
semantic differential
close-end question
A fixed alternative question requires respondents to select one or more response option from the set of predetermined choices. Another name for this kind of question is a(n)
dichotomous question.
open-ended question.
attitudinal question.
closed-end question.
semantic differential question.
Would you be interested in buying the Torrid merchandise on the Internet? ___ Yes ___ No
Before opening six Torrid plus-size-only retail stores that cater to women aged 15-30, a great deal of information was gathered from a sample of women to determine what types of items should be carried, the image of the store, its advertising, etc. Which of the following is an example of a closed-end question that might have been asked?

Why would you want to shop at a store that carries plus-size clothing?

In what ways might you be uncomfortable shopping at a plus-size-only retailer?

Would you be interested in buying the Torrid merchandise on the Internet? ___ Yes ___ No

What type of person would shop at Torrid?

What is your age? Please write the number in the space: __________

dichotomous
A(n) __________ question is the simplest form of a fixed alternative question that allows only a yes or no response.
dichotomous
open-ended
closed-end
attitudinal
semantic differential
dichotomous
“Have you been to a dentist within the past 6 months? ___ Yes ___ No?” is an example of which type of question?
Likert scale
semantic differential
dichotomous
open-ended
evaluative
dichotomous
A survey asked consumers of dental products the following question “Have you used toothpaste in the past week? ___ Yes ___ No” The results of this question show that 92.6 percent of the people in New York City have used toothpaste in the past week and 87.2 percent of people in Los Angeles have used toothpaste during the same period. This information was gathered by using which type of question?
open-ended
dichotomous
holistic
evaluative
Likert scale
scale
Semantic differential and Likert are question types that uses a(n)
scale.
frequency distribution.
measure of success.
open-ended question.
constraint.
semantic differential
A(n) __________ scale is a five-point scale in which the opposite ends have one- or two-word adjectives that have opposite meanings.
dichotomous
open-ended
Likert
attitudinal
semantic differential
semantic differential scale
What kind of question is the following? “Place an ‘X’ in the space that describes your feelings about this test.” Easy __ __ __ __ __ Difficult
Likert scale
semantic differential scale
dichotomous question
open-ended question
sensitivity analysis question
likert
A(n) __________ scale is one in which the respondent indicates the extent to which he or she agrees or disagrees with a statement.
Likert
attitudinal
dichotomous
open-ended
semantic differential
likert scale
What type of scale is the following? “Indicate your degree of agreement with the following statement: Marketing is an interesting subject” by checking one of the responses below. ( ) Strongly Agree ( ) Agree ( ) Disagree ( ) Strongly Disagree
semantic differential scale
dichotomous question
open-ended question
Likert scale
attitudinal question
ambiguous
Consider Figure 7-B above. The question “Do you eat at fast-food restaurants regularly: Yes or No?” is worded poorly because respondents don’t know what “regularly” means. This is an example of a(n) __________ question.
unanswerable
ambiguous
two questions in one
leading
nonmutually exclusive
panel
A __________ is a sample of consumers or stores from which researchers take a series of measurements.
representative group
jury of executive opinion
panel
survey of experts
focus group
an experiment
Data obtained by manipulating factors under tightly controlled conditions to test cause and effect is an example of
questionnaire data.
virtual modeling.
an experiment.
a panel.
nonprobability sampling.
Use a different number of salespeople in three different sales territories as your independent variable and changes in sales of health care services as the dependent variable.
As marketing vice president of Health Care Services, Inc., you must test the hypothesis that increasing the number of salespeople assigned to a territory will increase sales of health care services in the territory. Which experiment will do this best?

Create an incentive program for your salesforce based upon individual performance. Use increases in customer satisfaction as your dependent variable and increases in sales performance as your independent variable.

Select three degrees of service health care (poor, good, average) as your independent variable and measure customer responses for each grade using the same number of sales representatives in each territory as your dependent variable.

Create an incentive program for your salesforce based upon individual performance. Use increases in customer satisfaction as your independent variable and increases in sales performance as your dependent variable.

Use a different number of salespeople in three different sales territories as your independent variable and changes in sales of health care services as the dependent variable.

Create an incentive program for your salesforce based upon team performance. Use increases in customer satisfaction as your independent variable and increases in sales performance for the team as your dependent variable.

cause of an action; result of an action
In marketing experiments, the independent variable is the __________ and the dependent variable is the __________.
element that never changes; element that always changes
result; factor beyond the experimenter’s control
result of an action; cause of an action
cause of an action; result of an action
element that always changes; element that never changes
independent variable
GI Designs, a copper furniture manufacturer, increased the price on its copper tabletops by 20 percent for three months to see what the effect would be on its sales. The price increase is the __________ in this three-month experiment.
control
dependent variable
independent variable
constraint
hypothesis
independent variable
When Procter & Gamble acquired the Old Spice brand, it decided to reposition the brand by using a different advertising message to see whether its sales would increase. The new advertising message is the __________ in this marketing experiment.
dependent variable
extraneous variable
constraint
independent variable
error variable
changes in purchases such as dollar or unit sales of individuals or organizations.
When conducting marketing experiments, the independent variable often involves marketing mix elements such as product features or coupons, while dependent variables often include
elements of the environmental forces that cannot be controlled.
changes in channels of distribution or pricing.
elements of the marketing mix that cannot be manipulated.
the primary experimental hypothesis.
changes in purchases such as dollar or unit sales of individuals or organizations.
test market
Offering a product for sale in a small geographic area to help evaluate potential market actions is called a(n) __________.
micro market
test market
experimental market
simulated market
trial market
develop findings
Analyzing the data obtained during the marketing research project and presenting the findings take place during which step of the five-step marketing research approach?
collect relevant information
develop findings
take marketing actions
plan the budget
identify constraints
develop findings
Once a market researcher has defined the problem, developed the research plan, and collected the relevant information, what is the next step in the five-step marketing research approach?
set budgets
determine target market
take marketing actions
develop findings
determine if there is a planning gap between desired findings and actual findings
data mining
The extraction of hidden predictive information from large databases to find statistical links between consumer purchasing patterns and marketing actions is referred to as
predictive analysis.
information extraction.
variable analysis.
database management.
data mining.
data mining
Many consumers buy soft drinks and potato chips together when they shop at a grocery, convenience, or mass merchandiser store. But when querying its marketing information system (MIS), one convenience store discovered that when consumers bought a sandwich, many also purchased toothpaste. This information was obtained from checkout scanner data from its stores nationwide. This convenience store used __________ to extract this hidden information from its MIS to find the statistical link between the two product categories.
linear trend extrapolation
heuristic modeling
data mining
descriptive research
RFID data
evaluating the results
The final step in the five-step marketing research approach includes making action recommendations, implementing action recommendations, and __________.
evaluating the results
doing an environmental scan
making sales or profit projections for the coming year(s)
increasing or decreasing production based upon research collected
identifying possible opportunities for growth
take marketing actions
Making action recommendations, implementing action recommendations, and evaluating results take place during which step of the five-step marketing research approach?
define the problem
take marketing actions
collect relevant information
develop findings
develop the research plan
sales forecast
The total sales of a product that a firm expects to sell during a specified time period under specified environmental conditions and its own marketing efforts is referred to as the
prognostication.
sales forecast.
guesstimate.
marketing intuition.
market potential.
statistical methods
Three frequently used sales forecasting techniques are (1) judgments of the decision maker; (2) surveys of knowledgeable groups; and (3) __________.
heuristic prognostications
customer contracts
trade association experts
statistical methods
empirical studies
extending a pattern observed in past data into the future.
Trend extrapolation involves

extending a pattern observed in past data into the future.

selecting specific points on a graph of sales or market share, multiplying by the cost of living index, and allowing for a variation of plus or minus 3%.

averaging the total sales or market share for the previous 5 years and multiplying that number by the expected GDP growth rate for the next year (say 1.5%) to arrive at the next year’s forecast.

selecting a given percentage and using that number as a yearly predictive base regardless of changes in sales, revenue, or market share.

collecting projections from all regional sales managers and making the final projection.

linear trend extrapolation
In trend extrapolation, the forecasting technique that involves using a straight line is called __________.
causal analysis
non-parametric regression
planning gap analysis
infinite dimension
linear trend extrapolation
pattern is always a straight line.
Linear trend extrapolation is a form of trend extrapolation in which
pattern changes from year to year.
pattern is always a straight line.
slope of the line is tied directly to profits.
shape of the pattern is a hyperbola.
pattern follows an “S-shaped” curve.
market segmentation
Aggregating prospective buyers into groups that have common needs and will respond similarly to a marketing action is referred to as
consumer differentiation.
psychographics.
market segmentation.
market delineation.
aggregation marketing.
market segmentation
Small athletic shoe manufacturers such as Vans have targeted niche markets and make shoes designed to satisfy the needs of different specific groups of customers. This strategy is an example of
market segmentation.
mass customization.
customized manufacturing.
single chain marketing.
market specific selection.
market segment
A relatively homogenous group of prospective buyers that results from the market segmentation process is referred to as a(n) __________.
market segment
target market
customer base
ultimate consumer
preferred customer
be similar in terms of their consumption behavior.
To be identified as a market segment, members of the group must
be similar in terms of their consumption behavior.
represent a large share of the entire market and have buying power.
have diverse needs and have potential for future growth.
have diverse needs and be willing and able to purchase the product.
have the potential for future growth and increased profit or ROI.
product differentiation
A marketing strategy that involves a firm using different marketing mix actions to help consumers perceive the product as being different and better than competing products is referred to as __________.
market penetration
points of difference
market differentiation
product positioning
product differentiation
product differentiation
Apple’s iPhone has a feature known as Apple Pay that lets you use your phone to pay for credit purchases, meaning you could leave your wallet at home. This feature sets the smartphone apart from its competitors and is part of Apple’s strategy for
product segmentation.
market expansion.
product differentiation.
usage segmentation.
psychographic segmentation.
buyers’ or market needs
The process of segmenting a market and selecting specific segments as targets is the link between __________ and the organization’s marketing program.
self-regulatory industry standards
government regulations
top-level management
buyers’ or market needs
controllable environmental factors
not consider market segmentation at this time.
When expenses are greater than the potential increased sales from market segmentation, a firm should
not consider market segmentation at this time.
combine departments within the company to make the process more streamlined.
reduce production costs or increase prices to facilitate the segmentation process.
seek alternate channels of distribution, including Internet sales.
discontinue manufacturing any products that are not in the mature stage of their product life cycle.
multiple products, one segment.
All of the following are market segmentation strategies EXCEPT:
build-to-order.
multiple products, multiple market segments.
one product, multiple market segments.
multiple products, one segment.
mass customization.
the extra cost of developing and producing additional versions of the product
When a firm produces only a single product or service and attempts to sell it to two or more market segments, it avoids __________.
the extra cost of developing and producing additional versions of the product
creating a customer service gap
indirect distribution and logistics problems
restructuring the firm’s strategic planning
amortization costs of product enhancements
creates greater savings in production costs.
When compared to a multiple products, multiple market segments strategy, a one product, multiple market segment strategy
is a much more effective means of meeting consumers’ individual needs.
creates greater savings in production costs.
is a more effective way of meeting organizational objectives.
has significantly higher distribution costs.
is more profitable since a firm can charge the new segments higher prices without changing the product.
geographic segmentation
The annual Sporting News Baseball Yearbook had exactly the same stories but with 17 different covers to appeal to baseball fans in 17 different regions of the U.S. What is the basis of its market segmentation strategy?
psychographic segmentation
retail outlet segmentation
demographic segmentation
behavioral segmentation
geographic segmentation
one product with multiple market segments
In the United States, the Harry Potter series of books were often at the top of The New York Times fiction bestseller list. These books have been marketed by turns to preteen, teen, and adult readers around the world with creative marketing, including different book covers. Scholastic Press, the publisher of the Harry Potter books in the U.S., is using which of the following segmentation strategies?
multiple products with one segment
one product with one channel of distribution
one product with multiple market segments
one product with changes based on customer behavior
multiple products with multiple segments
reduced quality and higher prices
Which of the following is a disadvantage of employing a multiple products, multiple market segments strategy if NOT implemented well?
higher sales but lower profits
reduced quality and higher prices
meeting customer needs but at the expense of higher prices
lower prices but with higher production costs
higher quality but lower prices
Ford manufactures SUVs for those who wish to carry lots of people and pickup trucks for those who wish to carry lots of cargo.
Which of the following is an example of a multiple products and multiple market segments strategy?
College Football magazine selects different covers for essentially the same written content in order to appeal to different geographic markets in the U.S.
A new movie used several different movie trailers. One set of previews showed the action scenes in order to attract one audience and the other set showed romantic scenes to attract another audience.
Ford manufactures SUVs for those who wish to carry lots of people and pickup trucks for those who wish to carry lots of cargo.
Arm and Hammer Baking Soda can be used for baking and to remove odors from refrigerators and cat litter boxes.
Johnson’s Baby Oil is advertised as a skin softener for babies and as a makeup remover for women.
Betty Crocker carries one line of cake mixes for people with conventional ovens and another line of cake mixes for people with microwave ovens.
Which of the following is an example of a multiple products and multiple market segments strategy?
College Football magazine selects different covers for essentially the same magazine in order to appeal to different geographic markets in the U.S.
A new movie used several different movie trailers. One set of previews showed the action scenes in order to attract one audience and the other set showed romantic scenes to attract another audience.
Arm and Hammer Baking Soda can be used for baking and to remove odors from refrigerators and litter boxes.
Betty Crocker carries one line of cake mixes for people with conventional ovens and another line of cake mixes for people with microwave ovens.
Johnson’s Baby Oil is advertised as a skin softener for babies and as a makeup remover for women.
better serves customer’s needs
Kellogg’s has several cereals targeted at different types of users. This is an example of multiple products aimed at multiple markets. Manufacturing these different cereals is clearly more expensive than producing only one but seems worthwhile if it adds to the manufacturer’s sales revenues and profits, doesn’t reduce quality or increase price, and
conforms to all FDA guidelines.
uses the same promotion and packaging for all segments.
decreases the cost of the physical plant.
stabilizes competition.
better serves customers’ needs.
mass customization
Tailoring products or services to the tastes of individual customers on a high-volume scale is referred to as
family branding.
mass customization.
product differentiation.
economies of scale marketing.
build-to-order.
mass customization.
Custom Foot operates six retail locations. At first glance, none looks different from a typical boot store. But here the only boots on hand are display models, there is no inventory for sale and customers go home empty-handed, awaiting their orders. Customers browse the store, choosing style, color, and leather type, with about 100 displays to provide style guidelines. Custom Foot guarantees your boots will be ready within three weeks. This is an example of
mass customization.
specialty customization.
virtual merchandising.
one product and multiple market segments.
multiple products and multiple market segments.
mass customization.
ChoiceShirts is an online company that makes made-to-order T-shirts. Its online customers can order their shirts using any downloaded photo inserted into 600 templates or even design a shirt from scratch. This is an example of
family branding.
mass customization.
multiple products and multiple market segments.
one product and multiple market segments.
specialty customization.
cannibalization.
When a new product or a new retail chain steals customers and sales from older existing ones of an organization, it is referred to as
cannibalization.
amortization.
product appropriation.
product pilfering.
marketing Darwinism.
cannibalization
When Ann Taylor, a well-known retailer of sophisticated women’s clothing, started losing sales to its own LOFT outlets that feature moderately priced casual clothes, Ann Taylor was dealing with the marketing phenomenon known as __________.
amortization
guerrilla marketing
shrinkage
marketing Darwinism
cannibalization
“Will our new products steal customers or sales from our older ones?”
Suppose marketers want to use product differentiation and market segmentation strategies. What question should they ask when considering the potential for cannibalization with these strategies?
“Will our new products steal customers or sales from our older ones?”
“Will the products compete head-to-head with those of a competitor?”
“Can this action successfully draw customers away from competitors?”
“Are there enough similarities within the market segment to warrant such high costs?”
“Will this action eliminate the need for individualized advertising and promotion?”
link market needs of customers to the organization’s marketing program.
The purpose of the five key steps in segmenting and targeting markets is to
identify competitors that provide similar products that satisfy a firm’s customers’ needs.
provide guidance to reposition a firm’s products.
generate new products ideas for firms that are not growing in market share.
link market needs of customers to the organization’s marketing program.
correlate directly to each of the five environmental forces.
psychographic segmentation
Four general categories used to segment consumer markets are geographic segmentation, demographic segmentation, __________, and behavioral segmentation.
supplier segmentation
demand segmentation
regional segmentation
psychographic segmentation
product segmentation
geographic segmentation.
Segmentation based on where prospective customers live or work is referred to as
zip code segmentation.
geographic segmentation.
regional segmentation.
MSA segmentation.
NAICS code segmentation.
geographic
Region and city size are both variables used to employ __________ segmentation.
geographic
behavioral
district
psychographic
demographic
In China, KFC sells a spicier chicken the farther away its restaurants are from the coastal areas.
Which of the following statements best illustrates geographic segmentation?
GE builds a downsized microwave oven to hang under kitchen cabinets.
Del Monte offers a line of canned fruit with no added sugar or artificial sweeteners.
In China, KFC sells a spicier chicken the farther away its restaurants are from the coastal areas.
A fast food hamburger restaurant is only open for breakfast on weekdays and Saturdays but not Sundays.
A gourmet grocer advertises its services on a small-audience classical music station even though there is a much larger-audience rock station in the area.
geographic characteristics
Universal Concerts wants to bring a series of music concerts to Canada next year. In general, Western Canadians prefer country music while Eastern Canadians prefer rock. In fact, a country music event in eastern Canada is very likely to have lots of empty seats. To maximize revenue, Universal Concerts should segment its Canadian market according to __________.
geographic characteristics
demographic characteristics
music format characteristics
behavioral characteristics
psychographic characteristics
demographic
Variables that are based on some objective physical (gender, ethnicity), measurable (age, income), or other classification attribute (occupation) of prospective customers are used in which segmentation base?
personality
usage
needs
demographic
behavioral
gender
Which of the following is a consumer demographic segmentation variable?
personality
gender
usage rate
needs
region
demographic
Procter & Gamble (P&G) decided to skip a generation of consumers when it began to market Old Spice deodorant. The target market consists of men aged 18 to 34 years old (Generation Y) who don’t remember the Old Spice brand sold to their grandfathers (pre baby boomer) many years ago. P&G is using which type of segmentation variable?
behavioral
demographic
lifestyle
geographic
psychographic
demographic
When a telemarketer calls to sell a consumer life insurance, the last questions asked is what category does the person’s household income falls into (less than $50,000; $50,000 to $99,999; and $100,000 and over). When the telemarketer asks about household income, this indicates the use of which type of consumer variable the firm is using to segment its market?
usage
behavior
demographic
buying situation
psychographic
psychographic segmentation.
Segmentation based on some subjective mental or emotional attributes, aspirations, or needs of prospective customers is referred to as
behavioral segmentation.
affective segmentation.
socioeconomic segmentation.
psychographic segmentation.
psychosocial segmentation.
psychographic
Personality and lifestyle are both variables used to employ __________ segmentation.
geographic
behavioral
attitudinal
psychographic
demographic
psychographic
Magazines like Fitness, Field & Stream, Golf Digest, and Health focus on how people live their lives, and thus all use a __________ segmentation strategy.
psychographic
behavioral
situational
socioeconomic
geographic
behavioral segmentation.
Segmentation based on some observable actions or attitudes by prospective customers, such as what benefits they seek, as well as where, how frequently, and why they buy, is referred to as
demographic segmentation.
psychographic segmentation.
geographic segmentation.
behavioral segmentation.
socioeconomic segmentation.
behavioral segmentation.
Segmentation based on what product features are important to different customers is known as
demographic segmentation.
behavioral segmentation.
psychographic segmentation.
geographic segmentation.
socioeconomic segmentation.
behavioral
Product features and usage rate are both variables used to employ __________ segmentation.
geographic
demographic
loyalty
psychographic
behavioral
behavioral
A national car rental firm targets 50 percent of its advertising to salespeople who rent a car over 40 weeks per year. The company is using __________ segmentation.
geographic
demographic
loyalty
psychographic
behavioral
behavioral segmentation
College dorm residents frequently want to keep and prepare their own food and snacks to save money or have a late night snack. However, their dorm rooms are often woefully short of space. MicroFridge marketers understand this and offer a combination microwave, refrigerator, and freezer targeted to these students. MicroFridge is most likely using which basis of segmentation?
sociocultural segmentation
psychographic segmentation
geographic segmentation
behavioral segmentation
socioeconomic segmentation
usage rate
The quantity consumed or patronage (store visits) during a specific period is referred to as
usage rate.
purchase metric.
consumption index.
consumption rate.
demand amount.
usage rate
Frequency marketing is a strategy that focuses on
demographics.
benefits offered.
usage rate.
geography.
lifestyle.
behavioral segmentation.
Airlines have developed frequent-flier programs to encourage passengers to use the same airline repeatedly. This marketing strategy is based on
geographic segmentation.
behavioral segmentation.
psychographic segmentation.
demographic segmentation.
buying condition segmentation.
market size
Which of the following is a criterion used for selecting a target market?
similarity of needs of potential buyers within a segment
difference of needs of sellers between segments
feasibility of a marketing action to reach a segment
market size
simplicity and cost of assigning potential buyers to segments
expected growth of a segment
Which of the following is a criterion used for selecting a target market?
similarity of needs of potential buyers within a segment
difference of needs of buyers between segments
expected growth of a segment
feasibility of a marketing action to reach a segment
simplicity and cost of assigning potential buyers to segments
competitive position
Which of the following is a criterion used for selecting a target segment?
potential for increased profit
competitive position
similarity of needs of potential buyers within a segment
difference of needs of buyers among segments
potential of a marketing action to reach a segment
not be worth doing since its market size is very small.
A rehabilitation center wants to target women in their 20s who have received some permanent disability as the result of a skiing accident. In terms of the criteria used for selecting a target segment, this market would
have no expected growth.
not be compatible with the company’s current resources.
not be worth doing since its market size is very small.
not be readily accessible to the firm’s marketing programs.
be relatively expensive to reach.
selecting target market segments to reach.
During its market segmentation process for the Nike LeBron X basketball shoe, which sells for $200+ a pair, Nike decided to concentrate on affluent teens rather than members of high school basketball teams. This is an example of
selecting target market segments to reach.
forming products to be sold into groups.
developing a market-product grid and estimating size of markets.
taking marketing actions to reach target markets.
forming prospective buyers into segments.
taken a marketing action to reach a target market segment.
Doris Lewis owns Lewis Edibles, Inc., a company that makes Tongue Tinglin’ BBQ Sauce. She wants to target local people who like the special blend of flavors found only in North Carolina barbecue sauce. In developing a marketing strategy to sell the sauce, Lewis decided to join Goodness Grows in North Carolina, a specialty food association that advertises local products and distributes them to local supermarkets and gourmet shops. Lewis has just
formed a market segment using critical product features.
formed products to be sold into groups.
developed a market-product grid and estimating size of markets.
taken a marketing action to reach a target market segment.
formed prospective buyers into segments.
product positioning.
The place a product occupies in consumers’ minds on important attributes relative to competitive products is referred to as
product repositioning.
relative positioning.
competitive positioning.
product positioning.
selective perception.
product repositioning.
Changing the place an offering occupies in consumers’ minds relative to competitive products is referred to as
product placement.
perceptual mapping.
product positioning.
product repositioning.
product differentiation.
reposition
Recently, U.S. dairies, struggling to increase milk sales, tried to change the way adults thought about chocolate milk. The dairies wanted to __________ chocolate milk in the minds of adult consumers.
segment
differentiate
explain
promote
reposition
product repositioning
Mott’s used an advertising campaign to change the way consumers thought about its applesauce from a dinnertime side dish to a replacement for cooking oil in baking. The advertising message was that using applesauce in baking cuts calories and makes the resulting baked good healthier. Mott’s used a __________ strategy.
product repositioning
perceptual mapping
product positioning
product differentiation
psychographic
head-to-head
One approach to positioning a new product in a market is __________ positioning, which involves competing directly with competitors on similar product attributes in the same target market.
perceptual
head-to-head
psychological
differentiation
market
head-to-head
In the athletic shoe market, Reebok and Nike practice __________ positioning since both manufacturers vie for the same customers with technologically advanced products.
psychological
perceptual
differentiation
head-to-head
market
differentiation positioning
A positioning approach that involves seeking a less competitive, smaller market niche in which to locate a brand is referred to as __________.
competitive repositioning
head-to-head positioning
differentiation positioning
downsize positioning
product repositioning
differentiation
In the sneaker business, Heelys practiced __________ positioning when it introduced a line of Heelys sneakers that came with an imbedded, detachable wheel in the shoe’s heel marketed to young teens.
head-to-head
parallel market
lateral
repositioning
differentiation
use a differentiation positioning strategy.
Some Timex wristwatches can be purchased for less than $30 while Rolex wristwatches may carry a price tag of several thousand dollars. In general, consumers view Timex watches as being dependable, relatively accurate, and inexpensive timepieces that can be purchased in drug stores, discount stores, and department stores. The Rolex brand is perceived as an expensive status symbol distributed in fine jewelry stores or specialty shops. By using distinctly different pricing and distribution strategies, the marketers of Rolex watches
compete for the same segment through different channels of distribution.
develop similar products as Timex but under different names.
use a differentiation positioning strategy.
compete for the same customers through similar retail outlets.
create cognitive dissonance in consumers who purchased Timex wristwatches.
perceptual map.
A means of displaying or graphing in two dimensions the location of products or brands in the minds of consumers to enable a manager to see how consumers perceive competing products or brands, as well as its own product or brand, is referred to as a
perception matrix.
growth-share matrix.
market-product grid.
perceptual map.
product differentiation chart.
perceptual map.
A graph displaying consumers’ perceptions of product attributes in two dimensions is referred to as a
perceptual map.
perception matrix.
growth-share matrix.
market-product grid.
product differentiation chart.
in the minds of consumers.
Marketers use perceptual maps as a means to display or graph in two dimensions the location of products or brands
against large market segments in a market-product grid.
against small market segments in a market-product grid.
in virtual space that represents the business or product’s time in existence and growth.
in the minds of consumers.
against the revenues generated by other products or brands within the company.
two product attributes, ranging from high to low on that attribute.
The axes on a perceptual map are
sales and profitability.
two product attributes, ranging from high to low on that attribute.
market share and market growth rate.
product variety and profitability.
customer perceptions of the firm’s product versus the brand of the firm’s principal competitor.
consumer judgments about the important attributes for a product or brand class
Which of these is collected from consumers to develop a product’s perceptual map?
consumer judgments about the important attributes for a product or brand class
a listing of all prospective brands and products
managerial judgments about how consumers perceive products
rank order of the ratings of an existing brand’s preference relative to its competitors
detailed explanations of why consumers make the choices they do
discover how target customers rate competing products or brands with respect to these attributes
To effectively positioning a product or brand, companies take four steps: (1) identify the important attributes for the product or brand class; (2)__________; (3) discover where the company’s product or brand is on these attributes in the minds of potential customers; and (4) reposition the company’s product or brand in the minds of potential customers.
decide whether to keep or delete the market segment that your product offering targets
identify the competitors’ brands that make up the consideration set
identify market niches that were not selected during the market segmentation process
discover how target customers rate competing products or brands with respect to these attributes
create a marketing plan based on customers’ perceptions
product
As a marketing term, __________ generally includes not only physical goods, but also services and ideas as well.
marketing
invention
merchandise
product
concept
good
A product that has tangible attributes that a consumer’s five senses can perceive is referred to as a(n)
good.
service.
product concept.
new idea.
artifact.
durable; nondurable
Goods can be divided into __________ goods and __________ goods.
functional; aesthetic
required; desired
tactile; conceptual
durable; nondurable
product; service
service
Intangible activities or benefits that an organization provides to satisfy consumers’ needs in exchange for money or something else of value are referred to as __________.
services
goods
products
marketing mix
ideas
intangibility, inconsistency, inseparability, and inventory.
The four I’s of services consist of
intangibility, inconsistency, inseparability, and innovation.
intangibility, inventory, inflexibility, and impression.
intangibility, inconsistency, inseparability, and inventory.
intangibility, inventory, innovation, and impression.
intangibility, inconsistency, innovation, and impression.
can’t be held, seen, or touched before the purchase decision.
The intangibility element of a service refers to the fact that it
has value that can only be determined by using subjective criteria.
can’t be held, seen, or touched before the purchase decision.
requires the ability to provide the service even in times of no demand.
can maintain or accumulate good will with customers.
can be objectively evaluated.
intangibility of services.
Consumers have more difficulty evaluating services than they do products; the difficulty results from the
intangibility of services.
incongruity of services.
inseparability of services.
inflexibility of services.
interdependence of services.
inconsistency
Services depend on the people who provide them. As a result, their quality varies with each person’s capabilities and day-to-day job performance. This element of services is referred to as __________.
incongruity
differentiation
variation
inconsistency
intangibility
providing standardization and training.
Developing, pricing, promoting, and delivering services are challenging because the quality of the service is often inconsistent. Organizations attempt to reduce this inconsistency by
paying higher incentives to employees to encourage satisfactory performance.
reducing incentives available to employees because of poor performance.
reducing the customer contact points in the service delivery process.
providing standardization and training.
exercising better hiring practices.
inconsistency
Andrea Arenas is the owner of 2 Places at 1 Time, a concierge company. She and her staff of 60 perform everyday services, such as walking the dog, picking up cleaning, waiting for the repairman, and going to the post office, for people who are too busy to perform these simple acts. One way she tries to avoid ___________ of services for her regular customers is to make sure that the same well-trained person is always assigned to work for her clients.
inseparability
inconsistency
incongruity
inflexibility
intangibility
inconsistency
Alana operates a wedding preparation service that aids brides-to-be in the planning of their weddings. To maintain a quality image and a standardized offering, Alana provides extensive training for each of her employees. What unique aspect of services is Alana trying to address?
impressionability
intangibility
inconsistency
inseparability
uniqueness of the service
cannot separate the service itself from the deliverer of the service.
Inseparability in services means consumers
see little variation from one service provider in an industry to another.
cannot separate the service itself from the deliverer of the service.
are unable to differentiate price from quality.
cannot evaluate a service until it is being or has been used.
cannot separate themselves from the deliverer of the service.
idle production capacity.
A situation that occurs when a service provider is available but there is no demand is referred to as
off-peak pricing.
idle production capacity.
static demand.
capacity management.
excess inventory.
idle production capacity
Andrea Arenas is the owner of 2 Places at 1 Time, a concierge company. She and her staff of 60 perform everyday services such as walking the dog, picking up cleaning, waiting for the repairman, and going to the post office for people who are too busy to perform these simple acts. She has often been hired by major corporations to perform services for their harried executives, and even other employees. Her staff is overworked and she will soon hire more employees to fill demand. Arenas is not currently experiencing __________; in fact, all of her employees and equipment are fully being used.
off-peak pricing
idle production capacity
static demand
capacity marketing
capacity inventory
idle production capacity
Southwest Airlines operates five flights daily between Chicago and Phoenix during the winter. One flight leaves Phoenix at 12:10 p.m. The plane, a Boeing 737, has a capacity of 120 passengers. During the past month, the flight has averaged 24 passengers, a load factor of only 20 percent. Once the plane takes off, the empty seats generate no revenue for the airline for that flight. What unique aspect of services does this situation describe?
incongruity
intangibility
inconsistency
inseparability
idle production capacity
gap analysis.
The type of analysis that compares the differences between consumers’ expectations about a service and their experience with it based on dimensions of service quality is referred to as
customer relationship management.
service encounter differential.
gap analysis.
a customer contact audit.
a service audit.
expectations and experience.
In using a gap analysis, the two basic components of a customer’s evaluation of a service are
expectations and customer contact.
expectations and experience.
intangibility and inconsistency.
experience and credence.
inconsistency and inseparability.
gap analysis
Many restaurants now ask consumers to evaluate their experience on a short questionnaire when they pay their bill. This assessment of consumer expectations compared to the actual experience they had is a form of __________.
service encounter survey
customer profile analysis
gap analysis
customer contact audit
service audit
the degree of learning involved.
An important way of viewing new products is in terms of their effects on consumption, which from the perspective of consumers is by
the price.
the extent of media promotion.
the degree of potential product cannibalization.
the presence of feature bloat.
the degree of learning involved.
continuous innovation.
A product that is new in some way but requires no new behaviors to be learned by consumers is a
continuous innovation.
discontinuous innovation.
dynamically continuous innovation.
product transformation.
concurrent innovation.
generating awareness.
The emphasis of a marketing strategy for a continuous innovation concentrates on
obtaining narrow distribution.
setting a low price.
generating awareness.
using reminder advertising to reeducate consumers.
using personal selling.
disposable lighter
At the time of its introduction, which of the following products was the best example of a continuous innovation?
home security system
disposable lighter
microwave oven
electric toothbrush
video camera
continuous innovation
Wrigley’s new Alert Energy Caffeine Gum “offers a portable solution that lets adults control their caffeine intake.” This new gum is most likely which type of innovation?
continuous innovation
dynamically continuous innovation
discontinuous innovation
insignificant innovation
disruptive innovation
continuous innovation.
The addition of Clorox II bleach to Tide laundry detergents is an example of a
discontinuous innovation.
bundled innovation.
dynamically continuous innovation.
disruptive innovation.
continuous innovation.
dynamically continuous innovation.
A product that disrupts consumers’ normal routines but does not require totally new learning is a
continuous innovation.
dynamically continuous innovation.
discontinuous innovation.
progressive innovation.
disruptive innovation.
advertising to explain points of difference and benefits.
The emphasis of a marketing strategy for a dynamically continuous innovation would include
advertising to generate awareness.
obtaining widespread distribution.
advertising to explain points of difference and benefits.
setting a low price.
using personal selling.
dynamically continuous innovation.
LG Electronics Inc. has entered into an agreement with Google to offer selected smartphone models that use a multitouch interface rather than buttons to make calls with Google’s Android operating system. When the multitouch interface was first introduced, it was an example of which type of innovation?
continuous innovation.
discontinuous innovation.
disruptive innovation.
dynamically continuous innovation.
evolutionary innovation.
dynamically continuous innovation.
There have been pasta sauces on the market for years. These sauces have always required the pasta to be precooked before it is mixed with the sauces and other ingredients. The development of Prego Pasta Bake Sauce that does not require the use of pre-cooked pasta would be an example of a(n)
continuous innovation.
discontinuous innovation.
evolutionary innovation.
disruptive innovation.
dynamically continuous innovation.
discontinuous innovation.
A product that requires the learning of entirely new consumption patterns among consumers is referred to as a(n)
continuous innovation.
discontinuous innovation.
dynamically continuous innovation.
evolutionary innovation.
progressive innovation.
requires consumers to learn entirely new patterns of behavior and product usage.
A discontinuous innovation is a product that
disrupts consumers’ normal routine but does not require totally new learning.
requires no new learning by consumers.
is not purchased by innovators and early adopters.
initiates obsolescence of a product class.
requires consumers to learn entirely new patterns of behavior and product usage.
educate consumers about new consumption patterns through personal selling.
The emphasis of a marketing strategy for a discontinuous innovation would most likely be to
generate awareness among consumers.
advertise benefits to consumers that stress points of differentiation.
educate consumers about new consumption patterns through personal selling.
obtain widespread distribution in multiple channels.
stress price differentials from competitors’ products.
discontinuous innovation.
In the early 1900s, your great-great-grandfather probably purchased his first automobile. After years of driving a horse and buggy, he got into his new car and drove it into his new garage. The new automobile was an example of a
continuous innovation.
dynamically continuous innovation.
disruptive improvement.
discontinuous innovation.
evolutionary innovation.
discontinuous innovation.
Dragon Naturally Speaking, a speech recognition software program that allows you to use your voice instead of a keyboard to input text into a word processing program, is an example of a(n)
continuous innovation.
discontinuous innovation.
dynamically continuous innovation.
disruptive improvement.
evolutionary innovation.
adding Ball Park Beef Franks with Cheese to the Ball Park Franks line
Which of the following new products is the best example of the LOWEST level of risk from the company’s point of view?
adding Ball Park Beef Franks with Cheese to the Ball Park Franks line
moving from production of land-line telephones to smartphones
marketing the first Apple computer
changing the formula from Coca-Cola to New Coke and then back to Coca Cola Classic
offering online marketing classes rebranded under a new college name
brand extension
Using an existing brand name to introduce a product that is new to the company into a totally new, unfamiliar market seems like a good idea. Several years ago, Cosmopolitan magazine introduced Cosmopolitan-branded yogurt, and it failed quickly. This innovation strategy is known as a
radical invention
product line extension
disruptive innovation
brand extension
product deletion
brand extension.
A few years ago, Frito-Lay developed Frito-Lay Lemonade as a thirst-quencher for those consumers who also like Frito-Lay’s salty snacks such as Fritos corn chips. But when people think of the brand name Frito-Lay, thirst-quenching is not a benefit that comes to mind and Frito-Lay Lemonade failed. This innovation strategy is known as a
brand extension.
radical invention.
product line extension.
disruptive innovation.
product deletion.
an insignificant point of difference relative to competing snacks – consumers wouldn’t switch from eating snacks from Frito-Lay and others
When General Mills introduced Fingos, a corn chip-sized sweetened cereal flake, it assumed that its customers would normally snack on them dry like a potato chip. Unfortunately, consumers did not switch from munching on popcorn and potato chips. The primary reason for the failure of Fingos was __________.

an insignificant point of difference relative to competing snacks – consumers wouldn’t switch from eating snacks from Frito-Lay and others

too little market attractiveness – the growth in the snacks market is declining

poor execution of the marketing mix – General Mills did not offer free samples at grocery stores

poor product quality – the chips were not the same size

incomplete market and
product protocol – the brand name “Fingos” did not get consumers excited

poor product quality.
After Microsoft launched its Xbox 360 video-game console, millions began to experience the “red ring of death.” The problem: The consoles’ microprocessors ran too hot, causing them to pop off their motherboards. This cost the company not only money to extend its product warranty, but a huge portion of future sales and market share to competitors Sony and Nintendo. This failure was due to

not satisfying customer needs on critical factors.

poor product quality.

an insignificant point of difference.

incomplete market and product protocol.

too little market attractiveness.

had too little market attractiveness.
OUT! International’s Hey! There’s A Monster In My Room spray with a bubble-gum fragrance was designed to rid scary creatures from a kid’s bedroom. Although a clever idea, it failed because it

did not satisfy customer needs on critical factors.

had poor product quality.

had bad timing.

had an incomplete market and product protocol.

had too little market attractiveness.

new-product process
The seven stages an organization goes through to identify business opportunities and convert them into salable products or services is referred to as the __________.
commercialization process
SWOT process
business prospect development cycle
opportunity stage gate sequence
new-product process
seven stages from new product strategy development to commercialization.
The new-product process an organization goes through to identify business opportunities and convert them into salable products or services contains

three main steps: research, production, and distribution.

four distinct steps: research, evaluation, production, and distribution.

five key phases ranging from idea generation to creating the first prototype.

seven stages from new product strategy development to commercialization.

three phases: planning, implementation, and evaluation.

new-product strategy development
The stage of the new-product process that defines the role for a new product in terms of the firm’s overall objectives is referred to as __________.
distinctive competency determination
new-product strategy development
strategic marketing process
strategic invention process
product protocol definition
SWOT analysis and environmental scanning.
During the first stage of the new-product process, two important activities take place. They are
SWOT analysis and environmental scanning.
open innovation and business analysis.
concept testing and product forecasting.
R&D and operations set-up.
environmental scanning and open innovation.
idea generation
The stage of the new-product process that develops a pool of concepts to serve as candidates for new products is referred to as __________.
idea generation
product development
open innovation assessment
screening and evaluation
new-product strategy development
open innovation
Many forward-looking companies have discovered that their own organization does not generate enough useful new-product ideas. This has caused them to find new product ideas by developing strategic relationships with outside individuals and organizations, a practice known as __________.
innovation alliances
open innovation
open collaboration
piggy-back thinking
stakeholder cooperation
crowdsourcing
Generating insights leading to marketing actions based on massive numbers of peoples’ ideas is called __________.
brainstorming
groupthink
outsourcing
crowdsourcing
NIH method
crowdsourcing
Dell used __________ to develop an online site to generate 13,464 ideas for new products and website and marketing improvements.
brainstorming
crowdsourcing
group think
outsourcing
data mining
crowdfunding
Because early-stage financing is almost always a problem for those starting a new business, __________ is a way to gather an online community of supporters to financially rally around a specific project that is unlikely to get resources from traditional sources.
crowdfunding
open sourcing
venture capital
online banking
crowdsourcing
screening and evaluation
The stage of the new-product process that internally and externally evaluates new-product ideas to eliminate those that warrant no further effort is referred to as __________.
development
stage-gate
idea generation
business analysis
screening and evaluation
screening and evaluation
A 3M researcher worked with university students to develop the Post-it→ Flag Highlighter. His team evaluated the technical feasibility of the proposed design and determined whether the idea met the firm’s new-product objectives. At which stage of the new-product process was this product?
idea generation
screening and evaluation
business analysis
new-product strategy development
concept testing
business analysis.
The stage of the new product process that specifies the features of the product and the marketing strategy needed to bring it to market and make financial projections is referred to as
idea generation.
business analysis.
marketing analysis.
product development.
commercialization.
business analysis
An assessment of the fit of the proposed new products, from whether it can be economically developed and manufactured to the marketing strategy needed, take place during which stage of the new-product process?
business analysis
screening and evaluation
new-product strategy development
development
These activities are addressed at every stage with the exception of new-product strategy development.
prototype.
A full-scale operating model of the product under development is referred to as a
sample.
framework.
template.
prototype.
blueprint.
development
The stage of the new-product process that turns an idea on paper into a prototype is referred to as __________.
idea generation
screening and evaluation
business analysis
commercialization
development
development
At Mattel, Barbie is child-tested to be sure the doll cannot be broken apart and accidentally choke a child. This type of consumer or safety test occurs during the __________ stage of the new-product process.
new-product strategy development
development
business analysis
screening and evaluation
market testing
market testing.
The stage of the new-product process that exposes actual products to prospective consumers under realistic purchase conditions to see if they will buy is referred to as
development.
market testing.
business analysis.
commercialization.
screening and evaluation.
market testing
Audiences are allowed to preview actual movies (a sneak preview) such as The Hunger Games and Star Trek so that changes might be made before they are released to the general public during which stage of the new-product process?
market testing
business analysis
commercialization
screening and evaluation
concept testing
market testing
Breyer’s introduced a new line of ice cream flavors for sale in elegant black containers. This was done on a limited scale to determine consumer reactions before national distribution of the product. Breyer’s new product was in the __________ stage of the new-product process.
commercialization
screening and evaluation
business analysis
development
market testing
on a limited basis in a defined area.
Test marketing involves offering a product for sale
to random sample of people in the top ten major cities of the U.S.
in as broad a geographic region as possible.
to consumers that are representative of the target market.
on a limited basis in a defined area.
only on certain days of the week and hours of the day.
commercialization
The stage of the new-product process that positions and launches a new product in full-scale production and sales is referred to as __________.
marketing program execution
disbursement
launch
commercialization
final distribution
product life cycle
A concept that describes the stages a product goes through in the marketplace – introduction, growth, maturity, and decline – is referred to as the __________.
retail life cycle
product life cycle
marketing mix
product growth cycle
diffusion of product innovation
gain awareness
What is the marketing objective for the introduction stage of the product life cycle?
harvesting
market share
stress differentiation
maintain brand loyalty
gain awareness
stress differentiation
What is the marketing objective for the growth stage of the product life cycle?
minimize promotion
increase market share
stress differentiation
gain awareness
maintain brand loyalty
maintain brand loyalty
What is the marketing objective for the maturity stage of the product life cycle?
begin deletion
implement skimming
stress differentiation
gain awareness
maintain brand loyalty
harvesting
What is the marketing objective for the decline stage of the product life cycle?
harvesting
add outlets
stress differentiation
gain awareness
maintain brand loyalty
introduction
The marketing objective for a product in the __________ stage of the product life cycle is to create consumer awareness and stimulate trial.
introduction
growth
maturity
decline
accelerated development
stimulate trial
Marketing for a product in the introduction stage of its product life cycle should focus primarily on gaining awareness and which other marketing objective?
stress differentiation
stimulate trial
foster brand loyalty
maximize distribution
target a marketing niche
primary
The desire for a product class rather than for a specific brand is called __________ demand.
selective
primary
derived
generic
secondary
primary demand
Gillette spent $200 million in advertising to introduce the Fusion razor to male shavers. Such expenditures are often made to stimulate __________, the desire for the product class, rather than for a specific brand, when there are few competitors with the same product.
secondary demand
introductory demand
primary demand
discretionary demand
selective demand
advertising to cultivate primary demand
Promotional expenditures at the introduction stage of the product life cycle are best spent on __________.
contests and sweepstakes to stimulate selective demand
product samples to create secondary demand
advertising to cultivate primary demand
personal endorsements to generate word of mouth demand
coupons to maintain brand loyalty or static demand
primary
When the National Cattlemen’s Beef Association developed the “Beef, It’s What’s for Dinner” advertising campaign, it was trying to stimulate __________ demand.
selective
generic
derived
primary
secondary
selective
The preference for a specific brand is called __________ demand.
selective
secondary
primary
derived
generic
selective
As more competitors launch their own products and the product progresses along its life cycle, company attention is focused on creating __________ demand, or the preference for a specific brand.
primary
selective
derived
generic
secondary
selective
For years, when most consumers thought of cranberries, they thought of the Ocean Spray brand. Then Northland cranberry juice came on the market, claiming that it was superior to the Ocean Spray brand. Northland was creating __________ demand for its cranberry products.
primary
derived
generic
selective
secondary
skimming pricing; penetration pricing
The two most common pricing alternatives for products in the introduction stage of the product life cycle are __________ and __________.
skimming pricing; penetration pricing
price lining; product line pricing
markdown pricing; quantity discount pricing
skimming pricing; bundle pricing
penetration pricing; experience curve pricing
skimming
During the introduction stage of the product life cycle, a(n) __________ pricing strategy may be used. This pricing strategy charges a high initial price to recoup the costs of product development.
penetration
cost-plus
target ROI
skimming
above-market
capitalize on the price insensitivity of early buyers
A company may choose a skimming strategy during the introduction stage of its product to help recover costs of development and to __________.
capitalize on the price insensitivity of early buyers
discourage competition from other manufacturers
ease the product into its maturity stage
gain the largest unit sales possible
gain more distribution outlets
skimming
Xerox pioneered the first portable fax machine. In 1980, the price was $12,700. Xerox used a(n) __________ pricing strategy to help recover its research and development costs.
penetration
cost-plus
skimming
target ROI
above-market
penetration
During the introduction stage of the product life cycle, the strategy that discourages competitive entry by charging a low price for a new product is referred to as __________ pricing.
penetration
cost-plus
target ROI
below-market
skimming
penetration pricing
Xunrui Communications is an upstart maker of inexpensive smartphones for the Chinese market. Xunrui purchases components and uses small assembly factories in Shenzhen, in southern China. These smartphones retail for about $65 in U.S. dollars, much less than the $250 to $600 for smartphones marketed by Apple or Samsung, the top two marketers of these items. Here, Xunrui Communications most likely is using which pricing strategy?

penetration pricing
cost-plus pricing
target ROI pricing
above-market pricing
skimming pricing

introduction
3D OLED (organic light-emitting diode) HDTVs, such as the 55″ model from LG Electronics that costs about $10,000, which offers a significantly different viewing experience than any television previously available, are in which stage of their product life cycle?

introduction
growth
maturity
decline
harvest

growth
Which stage in the product life cycle is characterized by a rapid increase in sales and the appearance of competitors?
maturity
decline
growth
accelerated development
introduction
advertising emphasis switches to selective demand
Which of the following is a characteristic of the growth stage of the product life cycle?
advertising emphasis switches to selective demand
a growing proportion of trial purchases come from brand loyal users
product features remain unchanged
profit margins increase as sales increase
the product is sold in a narrowly selected number of retail outlets
growth
During the __________ stage of the product life cycle, product proliferation occurs as a results of each company’s efforts to differentiate its product from competitors’.
introduction
growth
maturity
decline
harvest
addition of new or modified product features
Which of the following is a characteristic of the growth stage of the product life cycle?

advertising emphasis switches to primary demand
a growing proportion of initial purchasers to repeat purchasers
addition of new or modified product features
profit margins increase as sales increase
there are a limited number of retail outlets for greater quality control

growth stage
Apple launched its iPad in 2010 and it, along with its companion iPad mini, have become the world’s bestselling tablet devices with their multitouch user interfaces and the availability of hundreds of thousands of apps. The product class has experienced tremendous growth in terms of sales and the addition of formidable competitors such as Samsung Galaxy, Google Nexus, Sony Xperia, etc. – all vying for market share. In which stage of the product life cycle are the iPad and other tablets?

decline stage
commercialization stage
accelerated development stage
growth stage
introduction stage

maturity
The __________ stage of the product life cycle is characterized by the slowing of total industry sales or product class revenue, causing marginal competitors to begin leaving the market.
decline
maturity
introduction
growth
harves
maturity
In which stage of the product life cycle do marginal competitors begin to leave the market?
introduction
growth
decline
maturity
harves
maintain market share
Promotional expenses at the maturity stage of the product life cycle are often designed to __________.

convince those who have abandoned the brand to try it again
maintain market share
create a sense of nostalgia
attract more price conscious consumers
thwart the growing number of competitors that have entered the market

deletion; harvesting
To handle products in the decline stage of the product life cycle, companies often use either a __________ strategy or a __________ strategy.
divesting; harvesting
diversification; contraction
deletion; harvesting
deletion; diversification
building; divesting
deletion
A strategy of dropping a product from the product line during the decline stage of the product life cycle is referred to as __________.
trimming
elimination
paring down
deletion
harvesting
category development index and brand development index
Managers often use two special indexes to help identify strong and weak market segments in order to provide direction for marketing efforts. The two indexes, CDI and BDI, stand for __________.
comprehensive demographic inventory and brand designation information
consumer demographic index and buyer demographic inventory
category development index and brand development index
consumer development index and brand development inventory
category development index and buyer development inventory
above-average product category purchases by a market segment
If a firm’s marketing dashboard displays a CDI over 100 for a consumer packaged good, such as General Mills’ Warm Delights Minis, this indicates which of the following?
a weak brand position in a segment
a strong brand position in a segment
above-average product category purchases by a market segment
below-average product category purchases by a market segment
There is not enough information to make any conclusions.
below-average product category purchases by a market segment
If a firm’s marketing dashboard displays a CDI under 100 for a consumer packaged good, such as General Mills’ Warm Delights Minis, this indicates which of the following?
a weak brand position in a segment
a strong brand position in a segment
above-average product category purchases by a market segment
below-average product category purchases by a market segment
There is not enough information to make any conclusions.
a strong brand position in a segment
If a firm’s marketing dashboard displays a BDI over 100 for a consumer packaged good, such as General Mills’ Warm Delights Minis, this indicates which of the following?
a weak brand position in a segment
a strong brand position in a segment
above-average product category purchases by a market segment
below-average product category purchases by a market segment
There is not enough information to make any conclusions.
a weak brand position in a segment
If a firm’s marketing dashboard displays a BDI under 100 for a consumer packaged good, such as General Mills’ Warm Delights Minis, this indicates which of the following?
a weak brand position in a segment
a strong brand position in a segment
above-average product category purchases by a market segment
below-average product category purchases by a market segment
There is not enough information to make any conclusions.
(Percent of a product category’s total U.S. sales in a market segment ÷ Percent of the total U.S. population in a market segment) × 100
The formula to calculate a CDI = __________.

(Percent of the total U.S. population in a market segment ÷ Percent of a brand’s total U.S. sales in a market segment) × 100

(Percent of a product category’s total U.S. sales in a market segment ÷ Percent of the total U.S. population in a market segment) × 100

(Percent of a brand’s total U.S. sales in a market segment ÷ Percent of the total U.S. population in a market segment) × 100

(Percent of the total U.S. population in a market segment ÷ Percent of a product category’s total U.S. sales in a market segment) × 100

The ratio of sales revenue of the firm to the total sales revenue of all firms in the industry, including the firm itself

(Percent of a brand’s total U.S. sales in a market segment ÷ Percent of the total U.S. population in a market segment) × 100
The formula to calculate a BDI = __________.

(Percent of the total U.S. population in a market segment ÷ Percent of a brand’s total U.S. sales in a market segment) × 100

(Percent of a product category’s total U.S. sales in a market segment ÷ Percent of the total U.S. population in a market segment) × 100

(Percent of a brand’s total U.S. sales in a market segment ÷ Percent of the total U.S. population in a market segment) × 100

(Percent of the total U.S. population in a market segment ÷ Percent of a product category’s total U.S. sales in a market segment) × 100

The ratio of sales revenue of the firm to the total sales revenue of all firms in the industry, including the firm itself

product modification
A marketing strategy that alters a product’s characteristic, such as its quality, performance, or appearance, to increase its value and sales to customers is referred to as __________.
market modification
product modification
product repositioning
market-product synergy
product management
alters a product’s characteristic, such as its quality, performance, or appearance, to increase its value to customers and to increase sales
Product modification refers to a marketing strategy that __________.

alters a product’s characteristic, such as its quality, performance, or appearance, to increase its value to customers and to increase sales

manages a product’s life cycle to increase its use among existing customers, create new use situations, or find new customers

tries to find new customers and convince users who abandoned it to purchase again

drops the lowest producing market segment and replaces it with an entirely new one

combines the lowest producing market segment into others to achieve marketing economies of scale

improving a product’s quality
Which of the following is a product modification strategy?
creating new advertising for a product
improving a product’s quality
finding a new target market for a product
creating a new use situation for a product
altering a product’s distribution
creating a new use situation.
All of the following are product modification strategies EXCEPT:
product bundling.
improving a product’s quality.
changing a product’s appearance.
creating a new use situation.
altering a product’s performance.
product modification
When Proctor & Gamble revamped Pantene shampoo and conditioner with a new vitamin formula and relaunched the brand with a multimillion-dollar advertising and promotion campaign, what strategy did it use to manage the product through its life cycle?
market modification
product repositioning
market-product synergy
product positioning
product modification
product modification
Twenty years ago, the Mississippi Gulf Coast was a nice place to vacation with a white sandy beach, golfing opportunities, resort hotels, and good seafood restaurants. With the addition of casinos, the Gulf Coast improved its odds of being a tourist destination for more travelers. This is an example of a __________ strategy.
market-product grid
diversification
product modification
market modification
product repositioning
market modification
A strategy for managing a product’s life cycle that attempts to find new customers, increase a product’s use among existing customers, or create new use situations is referred to as __________.
market modification
product modification
product repositioning
product extension
diversification
market modification
When Coca-Cola promoted Coke as a morning beverage for those consumers who don’t drink coffee, it used a __________ strategy.
product modification
brand modification
market-product extension
diversification
market modification
finding new users
Known for its popular line of construction toys for boys, LEGOS introduced a product line for young girls called LEGO Friends. This is an example of which market modification strategy?
finding new users
creating new use situations
increasing a product’s use by existing customers
modifying the product
reacting to competitors’ positions
finding new users
Major American car manufacturers are offering buying incentives to newly graduated college students who traditionally have little or no credit. Car manufacturers are using which of the following market modification strategies?
finding new users
creating new use situations
increasing a product’s use by existing customers
modifying the product
reacting to competitors’ positions
increasing a product’s use by existing customers.
Florida Orange Growers Association advocates drinking orange juice throughout the day rather than for breakfast only, in a market modification strategy known as

finding new users.
personalizing the use situation.
increasing a product’s use by existing customers.
modifying the product.
reacting to competitors’ positions.

create new use situations
Dockers, the U.S. market leader in casual pants, originally intended its product as a single pant for every situation. Dockers now promotes different looks for work, weekend, dress, and golf. Dockers’ new strategy is designed to __________.
create brand awareness
create new use situations
increase a product’s use
find new customers
lower surplus inventory levels
creating new use situations through a market modification strategy
Mott’s applesauce promotes itself as a low-fat alternative to cooking oil for baked goods. Mott’s is __________.
finding new users through a product modification strategy
increasing use by existing customers through a product modification strategy
modifying the product characteristics
creating new use situations through a market modification strategy
demarketing the product
product repositioning
Changing the place a product occupies in a consumer’s mind relative to competitive products is referred to as __________.
market modification
product modification
product repositioning
product positioning
perceptual mapping
creating a new use situation.
All of the following are factors triggering the need for product repositioning EXCEPT:
creating a new use situation.
reaching a new market.
catching a rising trend.
changing the value offered.
reacting to a competitor’s position.
repositioning
Sealy, the self-proclaimed largest manufacturer of mattresses in the U.S., recently set out to redefine its function in the bedrooms of America. No longer did it want to be known as simply a mattress company. It wanted Sealy to be known as the world’s leading “sleep wellness provider.” This is an example of __________.
reverse marketing
demarketing
repositioning
segmenting
positioning
reposition Frosted Flakes
For many years, Kellogg’s Frosted Flakes, a ready-to-eat breakfast cereal, was perceived as a cereal for children. Tony the Tiger, a cartoon character, extolled Frosted Flakes, and advertisements depicted children enjoying the product with Tony in competitive situations. Recently, in response to declining sales of Frosted Flakes, the cereal-maker has adopted a new series of advertisements that show adults admitting that they enjoy Frosted Flakes, too. Kellogg’s is attempting to __________.
develop a perceptual map for Frosted Flakes
reposition Frosted Flakes
complete the Frosted Flakes product life cycle
introduce a new product line extension for Frosted Flakes
position Frosted Flakes
react to a competitor’s position
New Balance, Inc. successfully repositioned its athletic shoes to focus on fit, durability, and comfort rather than on going head-on against Nike and Adidas on fashion and professional sports. This product repositioning strategy was designed to __________.
react to a competitor’s position
reach a new target market segment
catch a rising trend
change the value offered to its customers
accommodate its target audience preference for comfortable sneakers
react to a competitor’s position
New Coke was repositioned as a slightly sweeter, less filling soft drink because the Coca-Cola Company discovered that its 1984 market share in supermarkets was 2 percent behind Pepsi. This product repositioning strategy was designed to __________.
reach a new market
catch a rising trend
change the value offered
change its target audience
react to a competitor’s position
repositioned
Johnson & Johnson effectively __________ St. Joseph Aspirin from a product for infants to one targeted at adults who may need a low-strength aspirin designed to reduce the risk of heart attacks or strokes.
reinvented
resurrected
reconfigured
repositioned
realigned
reaching a new market
Johnson & Johnson effectively repositioned St. Joseph Aspirin as a product for infants to an adult low-strength aspirin to reduce the risk of heart attacks or strokes. This is an example of a product repositioning by __________.
reacting to a competitor’s position
reaching a new market
catching a rising trend
changing the value offered
product modification
reach a new target market segment
In its recent “You’re not you when you’re hungry – Snickers satisfies” TV ad campaign, Mars, the maker of the Snickers candy bar, attempted to reposition Snickers from a sugary dessert-like food to a snack food that can satisfy one’s immediate feeling of hunger. Mars used this product repositioning strategy with its Snickers brand to __________.
react to a competitor’s position
catch a rising trend
reach a new target market segment
change the value offered to its customers
implement a global strategy
reach a new market
Proctor and Gamble repositioned its Old Spice anti-perspirant brand from a deodorant your grandfather might use to a strong, hip anti-perspirant through commercials that showed the target market of 18- to 30-year-old men advocating its use. P&G used this product repositioning strategy with its Old Spice brand anti-perspirant to __________.
react to a competitor’s position
catch a rising trend
change the value offered
diversify its product portfolio
reach a new market
reaching a new market
An aging baby boomer population has led to increased interest in developing and marketing products to satisfy the needs of this large market. As a result, moisturizing lotions and creams like Oil of Olay are now repositioned as age-defying products. This is an example of which product repositioning action?
reaching a new market
reacting to a competitor’s position
trading up
changing the value offered
product modification
catch a rising trend
Pretzels were first introduced as a salty snack. Later, the product was repositioned as a low-fat snack in order to __________.
respond to a competitor’s head-to-head positioning strategy
reach a new market
catch a rising trend
change the value offered
change its target audience