Mktg 353 Chapter 7

tf By definition, marketing plans should be short and specific.
false
tf The first step in traditional top-down planning is to determine specific marketing objectives.
false
tf The two types of marketing objectives are need-satisfying and sales-target.
true
tf Not all brands use a positioning strategy.
false
tf Lucas Inc. makes lubricating oil specifically for race cars and uses a positioning strategy based on user/application.
true
tf Transactional marketing is simpler than relationship marketing.
true
tf Value is defined as the ratio of price to total benefits provided.
false
tf The newspaper that writes the story about the grand opening of a Applebee’s restaurant is a stakeholder for that restaurant.
true
tf. Different stakeholders require different types of relationships.
true
tf The principle benefit of IMC is cost efficiency.
false
tf To influence customers’ perceptions, marketers must understand that every corporate activity has a message component.
true
tf IMC is not a marketing concern outside the United States.
false
tf. The advertising plan is a natural outgrowth of the marketing plan.
true
tf13. A SWOT analysis for a fast-food restaurant would look at its competition, the workforce, and the economy.
true
tf14. According to the advertising pyramid, the first task of advertising is to communicate enough information about the product to develop conviction.
false
tf15. The advertising pyramid reflects the traditional mass-marketing approach.
true
tf16. The two substrategies of advertising strategy are the media strategy and the message strategy.
false
tf17. In consumer goods marketing, increases in market share are closely related to increases in marketing budgets.
true
tf18. Small firms with limited capital typically budget using all-available-funds method.
true
tf19. The objective/task method of setting budgets is also known as the budget buildup method.
true
20. The _____for an organization assembles all the pertinent facts about the organization, the markets it serves, and its products, services, customers, and competition.
(1 point)
a.
vision

b.
marketing plan

c.
advertising plan

d.
marketing mix

e.
competitive strategy

b
21. The written marketing plan must reflect the goals of top management and:
(1 point)
a.
be consistent with company’s mission and capabilities

b.
be approved by all stakeholders

c.
be benchmarked against others in competing industries

d.
must be designed to emphasize the development of transactional relationships

e.
include all of the above to stand a chance of being successful

a
22. What is the first step in the traditional top-down marketing plan?
(1 point)
a.
developing marketing tactics

b.
forming marketing strategy

c.
conducting a situation analysis

d.
evaluating potential marketing objectives

e.
establishing advertising objectives

c
23. Black Hills Distributing has just completed a detailed, factual study of the distribution company’s current situation and how it got there. Its next step in the development of its marketing plan is to:
(1 point)
a.
decide which advertising media will best reach its target markets

b.
determine specific marketing objectives

c.
evaluate potential marketing objectives

d.
establish advertising strategy

e.
design marketing tactics

b
24. What is the most common format used to develop a marketing plan?
(1 point)
a.
hierarchical

b.
IMC

c.
bottom-up

d.
top-down

e.
functional

d
25. Baxter International, Inc., maintains manufacturing facilities around the world, one of which in North Carolina is the world’s largest manufacturer of IV solutions in flexible containers. A(n) _____ would reveal to Baxter changes in its environments that the company would need to address to maintain its standing as the leading producers of IV solutions in flexible containers.
(1 point)
a.
situation analysis

b.
external market analysis

c.
market survey

d.
product audit

e.
stakeholder audit

a
26. The exhibition and trade show industry, after decades of fabulous growth, is experiencing business declines. The _____ for the Center for Exhibition Industry Research, reported, “The exhibition industry will face more competition for marketing dollars in the next five years than it has in the last 25 years.”
(1 point)
a.
situation analysis

b.
external market analysis

c.
market survey

d.
product audit

e.
stakeholder audit

a
27. Pyramid Breweries Inc. has stated that partnering with committed wholesalers capable of delivering first class customer service is an important _____ objective for the company if the microbrewery is to maintain its reputation for customer satisfaction.
(1 point)
a.
corporate

b.
entrepreneurial

c.
advertising

d.
logistical

e.
stakeholder

a
28. _____ objectives can be stated in terms of profit, return on investment, net worth, growth, or corporate reputation.
(1 point)
a.
Environmental

b.
Functional

c.
Corporate

d.
Operational

e.
Entrepreneurial

c
29. Within a timeframe of five to seven years, Orco Construction Supply, a specialty distributor of tools and hardware to framing and foundation contractor markets in California, Arizona, and Nevada plans to hit a revenue mark of $500 million which will more than double its 2003 gross sales that are expected to approach $200 million. This would be an example of a(n) _____ objective.
(1 point)
a.
sales-target

b.
target market

c.
need-satisfying

d.
market tracking

e.
environmental

a
30. _____ objectives can be categorized as either general need-satisfying objectives or specific sales-target objectives.
(1 point)
a.
Environmental

b.
Functional

c.
Corporate

d.
Marketing

e.
Entrepreneurial

d
31. Why would a company set need-satisfying objectives?
(1 point)
a.
to create demand in a static environment

b.
to take full advantage of the consumer trend to eat out more

c.
to shift its organizational structure from a transformational to a transactional mode

d.
to shift the organization’s view from a production orientation to concern for the needs of its target market

e.
to provide equity to its stakeholders

d
32. Harry & David is a catalog retailer that specializes in fruit gifts, but it does not see itself as just a merchant of fruit. By setting _____ objectives, the retailers views itself as a gift provider.
(1 point)
a.
need-satisfying

b.
sales-driven

c.
sales-target

d.
production-oriented

e.
environmental

a
33. Assume a bakery that wholesales gourmet pies and cakes to upscale restaurant chains has developed marketing objectives. Which of the following is the BEST sales-target objective for the bakery to use?
(1 point)
a.
to increase sales of pecan pies by 3 percent during the next six months

b.
to have most of the staff attend a marketing seminar

c.
to increase sales of cheesecake to the point where demand exceeds supply every week

d.
to raise net profit by 50 percent during the next three weeks

e.
to build a Web site

a
34. _____ is the third section of the marketing plan and explains how the company plans to accomplish its marketing objectives.
(1 point)
a.
The control process

b.
Implementation

c.
The stakeholder analysis

d.
The marketing strategy

e.
The marketing mix

d
35. Silly Putty has been around for years. It began as a gag gift sold in specialty stores alongside fake vomit. It has always avoided direct confrontation with other toy companies by finding a market that was small enough to defend and never really acting like a marketing leader. Which of the following strategies has Silly Putty successfully followed?
(1 point)
a.
aggressive

b.
flanking

c.
defensive

d.
circumventing

e.
guerrilla

e
36. As the leading manufacturer of bleach in the nation, Clorox must guard itself against challenges from detergent manufacturers who are using bleach as a detergent additive. According to Jack Trout and Al Reis’s Marketing Warfare, which type of a strategy should Clorox use?
(1 point)
a.
protective

b.
aggressive

c.
defensive

d.
offensive

e.
guerrilla

c
37. In November 2005, MTV World launched MTV Chi, a channel catering to Chinese living teenagers in the United States. Chinese teenagers in the U.S. are the cable station’s:
(1 point)
a.
marketing mix

b.
advertising mix

c.
product concept

d.
segmentation variable

e.
target market

e
38. Hops Grillhouse & Brewery, formerly known as Hops Restaurant/ Bar/Brewery, has unveiled a multimillion dollar brand strategy featuring a new menu intended to “capture consumer preferences for high quality, freshness and grilled tastes as well as an array of aromas, textures and price points.” Its product mix of handcrafted beer and superior food is unlike that offered by other similar restaurant chain and describes its _____ strategy.
(1 point)
a.
segmentation design

b.
positioning

c.
market segmentation

d.
marketing mix

e.
diversification

b
39. _____ refers to the place a brand occupies competitively in the minds of consumers.
(1 point)
a.
Product segmentation

b.
Product placement

c.
Positioning

d.
The perceptual pyramid

e.
The strategic map

c
40. Which of the following is NOT one of the distinct approaches to developing a positioning strategy?
(1 point)
a.
cultural symbol

b.
product class

c.
product user

d.
marketing mix

e.
price/quality

d
41. Clos du Bois wine, for example, pursues an advertising campaign targeting the gay and lesbian community that has been remarkably successful. Its ad in gay publications features a wine cork emblazoned with the Gay Pride rainbow–an instantly recognizable symbol in the gay community. What approach to positioning is the winery using?
(1 point)
a.
cultural symbol

b.
product class

c.
product user

d.
marketing mix

e.
price/quality

c
42. The University of Phoenix has been described as more like an office building or industrial park than a place of higher education. It has no library building, and its bookstore only sells textbooks. The university is a subsidiary of a for-profit company called the Apollo Group. It proudly billed itself as “the largest private university in the United States.” What approach to positioning is the university using?
(1 point)
a.
cultural symbol

b.
product class

c.
product user

d.
marketing mix

e.
price/quality

b
43. Entrepreneur Chrissy Azzaro is founder of My-Tee, a Los Angeles fashion company. Besides its signature product, the My-Tee T-shirt, the company makes its own line of skirts, shoes, tank tops and accessories that retail from $32 to $78. Publicists and buyers browse My-Tee’s trendy showroom in Los Angeles for the latest trends and clothing lines. The company’s promotional strategy relies on publicity. Celebrities from Hilary Duff to Courteney Cox have been photographed in My-Tee clothing. This exposure helped the company rack up $1 million in sales last year. This is a brief description of My-Tee’s:
(1 point)
a.
advertising mix

b.
marketing mix

c.
marketing objectives

d.
organizational strategy

e.
product differentiation

b
44. _____ determine the specific short-term actions to be taken, internally and externally, by whom, and when.
(1 point)
a.
Corporate objectives

b.
Tactics

c.
Organizational structures

d.
Environmental objectives

e.
Strategic postures

b
45. Smaller companies typically use a bottom-up marketing format plan because:
(1 point)
a.
handling day-to-day problems leaves little time for formal planning

b.
they don’t need to create a competitive advantage

c.
long-term strategies are needed to keep a business focused on the future

d.
failure to have a mission is one of the major reasons for small-business failure

e.
a bottom-up planning allows more time for development of a customer relationship strategy

a
46. Randall Grahm, the owner of Bonny Doon Vineyards, made a name for his wines by injecting an irreverent sense of humor into everything associated with the winery. One of the _____ he used was to host a black mask dinner this fall to celebrate “the death of wine corks” when his company decided to use screw tops.
(1 point)
a.
marketing objective

b.
control mechanism

c.
action program

d.
strategic posture

e.
organizational structure

c
47. _____ is the ratio of perceived benefits to the price of the product in a consumer study.
(1 point)
a.
Net worth

b.
Contribution margin

c.
ROI

d.
Retained earning

e.
Value

e
48. According to the text, which of the following would be an example of a stakeholder?
(1 point)
a.
centers of influence

b.
the press

c.
corporate CEO

d.
financial community

e.
all of the above

e
49. Clos du Bois wine pursues an advertising campaign that targets the gay and lesbian community. Its ad in gay publications features a wine cork emblazoned with the Gay Pride rainbow. Gay publications are examples of _____ for Clos du Bois wine.
(1 point)
a.
reference groups

b.
target audiences

c.
target markets

d.
stakeholders

e.
environmental curators

d
50. Kotler and Armstrong have identified five levels of relationships that can be formed between a company and its various stakeholders. Roy Harold purchased a new washer/dryer for his apartment. Shortly after the appliances had been installed, a store representative called Harold and asked if he were satisfied with the washer/dryer and how they were installed. The store representative also asked Harold to call if he had any further needs for appliances. This is an example of which relationship level?
(1 point)
a.
reactive relationship

b.
basic transactional relationship

c.
accountable relationship

d.
proactive relationship

e.
partnership

c
51. Kotler and Armstrong have identified five levels of relationships that can be formed between a company and its various stakeholders. Charlotte purchased a book on how to crochet from a Web site. After purchasing the book, she was pleased to receive regular e-mail from the site offering her other products that she might be interested in. The e-mail also told her about current trends in yarn and offered troubleshooting advice as well as free patterns. The relationship between Charlotte and the Web site is at what level?
(1 point)
a.
reactive relationship

b.
basic transactional relationship

c.
accountable relationship

d.
proactive relationship

e.
partnership

d
52. Which of the following statements about IMC (integrated marketing communications) is true?
(1 point)
a.
Many believe that IMC is what makes relationship marketing possible.

b.
IMC is both a concept and a process.

c.
Many companies initially take a narrow, inside-out view of IMC.

d.
Whether a company takes a narrow view or a broad view of IMC depends to a great extent on its corporate culture.

e.
All of the above statements about IMC are true.

e
53. The full-page ad that Delta Airlines ran in Fast Company magazine is an example of which type of company/brand-related messages that are sent to company stakeholders?
(1 point)
a.
planned

b.
inadvertent

c.
unplanned

d.
product

e.
service

a
54. The price of a model vintage wine, the use of Federal Express delivery by Lands’ End, and the workmanship found in a finely crafted Persian rug are all examples of which type of company/brand-related messages that are sent to company stakeholders?
(1 point)
a.
planned

b.
functional

c.
unplanned

d.
product

e.
service

d
55. Stakeholders receive a(n) _____ message when a Six Flags amusement park discovers a lost child and cares for that child until he or she can be reunited with its parents.
(1 point)
a.
planned

b.
functional

c.
unplanned

d.
product

e.
service

e
56. Jerome stopped at Brewster’s and purchased himself a chocolate ice cream cone. As he was exiting the store, the cone developed a leak and dripped ice cream all over his expensive suit. At that point, he swore to never buy Brewster’s ice cream ever again. In terms of the messages that stakeholders receive, Jerome received a(n) _____ message.
(1 point)
a.
planned

b.
functional

c.
unplanned

d.
product

e.
service

c
57. Think about the various sources of brand messages. Which message form is considered to be a confirm message because that is what others say and confirm (or not) about what the company says or does?
(1 point)
a.
planned

b.
functional

c.
unplanned

d.
product

e.
service

c
58. What should be the advertising manager’s first step when he or she is asked to develop an advertising plan?
(1 point)
a.
select the target audience

b.
develop marketing objectives

c.
determine the most cost-effective media

d.
establish an advertising budget

e.
review the company’s marketing plan

e
59. The SWOT analysis part of the marketing plan for a microbrewery would contain information about:
(1 point)
a.
ongoing research into new brewing techniques

b.
inspections from local health agencies

c.
worker turnover rates

d.
its competition

e.
all of the above

e
60. Mood-lites are colored light bulbs that were developed according to research on how colors affect moods. According to the advertising pyramid, the first task of the original advertising for Mood-lites, was to create:
(1 point)
a.
awareness

b.
action

c.
conviction

d.
brand loyalty

e.
intent to buy

a
61. According to the advertising pyramid, the second task of advertising is to:
(1 point)
a.
communicate enough information about the product and its features to persuade a certain number of people to believe in its value

b.
measure the quantitative objectives in the marketing plan

c.
acquaint some portion of the market with a product’s existence

d.
persuade customers to buy larger sizes or multiple units

e.
accelerate sales by implementing a variety of sales promotions

a
62. Mycogen Seeds has announced details of its Over-the-Top program for 2005-06. This unique program offers cash rebates to customers who purchase both Mycogen brand products and any of 16 selected crop protection products from Dow AgroSciences. According to the advertising pyramid, the purpose of this rebate is to encourage:
(1 point)
a.
action

b.
comprehension

c.
brand loyalty

d.
conviction

e.
awareness

a
63. The two substrategies of the advertising strategy are the:
(1 point)
a.
stakeholder strategy and the creative strategy

b.
message strategy and the media strategy

c.
planning strategy and the implementation strategy

d.
creative strategy and media strategy

e.
customer-satisfaction strategy and the profit strategy

d
64. Which of the following statements about the relationship of advertising to sales and profits is true?
(1 point)
a.
Sales will remain constant if there is additional advertising.

b.
There will be no sales if there is no advertising.

c.
The durability of advertising is long-term.

d.
Increases in market share are more directly related to increases in the marketing budget than to price reductions.

e.
There is no saturation level for advertising.

d
65. Research about the relationship of advertising to sales and profits is far from perfect. However, based on that research several generalizations are possible. Which of the following statements is NOT consistent with that research?
(1 point)
a.
Sales will increase if there is additional advertising.

b.
There will be no sales if there is no advertising.

c.
There are saturation limits above which no amount of advertising can push sales.

d.
Increases in market share are more directly related to increases in the marketing budget than to price reductions.

e.
Sales response to advertising is spread out over a long period of time.

b
66. According to the text, the _____ method is NOT a method typically used by national advertisers for the allocation of advertising funds.
(1 point)
a.
percentage-of-sales

b.
budget breakdown

c.
objective/task

d.
share-of-market/share-of-voice

e.
budget buildup

b
67. The percentage-of sales method:
(1 point)
a.
is inexpensive to use

b.
relates sales to revenue

c.
violates a basic marketing principle

d.
is the simplest to use of all budgeting methods

e.
is accurately described by all of the above

e
68. Mood-lites are colored light bulbs that were developed according to research on how colors affect moods. In allocating funds for advertising the new light bulbs, its manufacturer decided to budget 5 percent of last year’s sales for advertising expenditures. Which allocation method was the manufacturer using?
(1 point)
a.
percentage-of-sales

b.
self-defense

c.
objective/task

d.
share-of-market/share-of-voice

e.
budget buildup

a
69. What is the greatest shortcoming for the percentage-of-sales method of setting the advertising budget?
(1 point)
a.
The percentage-of-sales method is too expensive to be used by small business owners.

b.
The basis for setting the percentage is often determined arbitrarily.

c.
The percentage-of-sales method assumes a certain number of dollars are needed to sell a certain number of units.

d.
The percentage-of-sales method encourages top management to think of growth in terms of percentages.

e.
The percentage-of-sales method assumes the marketplace will be dynamic.

b
70. The FoldzFlat Pen flat pen that folded in half to the size of a business card. Its flat surface is a perfect “billboard” on which to print advertising and company logos, and it can be shaped into a bookmark, a business card, a race car or a skateboard. Its manufacturer wants to advertise this new product to people in the specialty products industry. Which method of setting its advertising budget should the new product use?
(1 point)
a.
percentage-of-sales

b.
self-defense

c.
objective/task

d.
share-of-market/share-of-voice

e.
budget buildup

d
71. According to the text, a firm that has used the share-of-market/share-of-voice method for allocating advertising funds for a number of years is may have a tendency to:
(1 point)
a.
become overly competitive in all marketing activities

b.
rely too heavily on the budget buildup method

c.
maintain a lower percentage of media exposure than its competitors

d.
become complacent

e.
overreact if competitors increase their advertising budgets

d
72. When used to determine how to allocate funds for advertising, the _____ method has three steps: defining objectives, determining strategy, and estimating costs.
(1 point)
a.
unit-of-sales

b.
share-of-market/share-of-voice

c.
percentage-of-sales

d.
percentage-of-profit

e.
objective/task

e
73. Which of the following statements about the objective/task method for allocating advertising expenditures is true?
(1 point)
a.
It is often difficult to determine in advance the amount of money needed to reach a specific goal.

b.
The objective/task method assumes a static external environment.

c.
The objective/task method assumes marketing activities result in demand.

d.
The objective/task method is too costly to use on an annual basis.

e.
The objective/task method permits the quick and ready measurement of the success of an ad campaign.

a