Chapter 6
REACHING GLOBAL MARKETS
10. Which of the following trends have significantly affected world trade?
a.
b.
c.
d.
e.
Predatory pricing between companies within a country
Development of networked global marketspace
Cross-cultural student exchange
Economic adaptation and control
redefined national boundaries and a more aggressive attitude towards initiating international
tariffs and quota systems
11. Former President Bill Clinton attempted to protect American firms from foreign competition by
placing a government tax on Japanese automobiles imported to the United States. President
Clinton's goal was to raise the price on Japanese imports, thereby encouraging American
consumers to purchase American-made automobiles. The tax the President threatened to impose
is an example of a(n):
a.
b.
c.
d.
e.
boycott.
tariff.
quota.
sanction.
exchange subsidy.
12. The world's largest manufacturer of peppermint candy canes was in Albany, Georgia, until it
could no longer afford to buy the sugar needed for its operation. It moved its manufacturing
business to Mexico where there are no restrictions (as existed in the U.S.) on the amount of sugar
that can be brought into the nation. The movement of this U.S. business to Mexico was caused
by a(n) __________ established by the U.S. government.
a.
b.
c.
d.
e.
tariff
blocked currency
quota
excise tax
exchange subsidy
13. Three types of companies populate and compete in the global marketplace: international firms,
multinational firms, and __________ firms.
a.
b.
c.
d.
e.
culturally diverse
transnational
polycentric
ethnocentric
decentralized
14. A firm that views the world as consisting of unique parts and markets to each part differently is
called a(n):
1
a.
b.
c.
d.
e.
polycentric firm.
ethnocentric firm.
international firm.
multinational firm.
transnational firm.
15. Which of the following statements about the emergence of a networked global marketspace is
true?
a.
b.
c.
d.
e.
The chief advantage of the global marketspace over the traditional bricks-and-mortar stores
for customers is the ability to shop between set hours of the day.
More business-to-business marketing is done on the Internet than business-to-consumer
marketing.
The most active participants in the networked global marketspace are companies in
developing nations.
All business in the networked global marketspace is conducted in English.
All of the above statements about the emergence of a networked global marketspace are true.
16. Cleanliness is a __________ that permeates Japan. Some banks advertise that they actually wash
the money deposited in them before it is recirculated. Pentel makes a germ-free pen for the
Japanese market with the slogan “The pen is mightier than the bacterium.”
a.
b.
c.
d.
e.
value
cultural ethnocentrism
protectionist perspective
consumerist perspective
cognitive attitude
17. KFC in Japan sells tempura crispy strips. In northern England, it stresses gravy and potatoes,
while in Thailand it offers fresh rice. In Holland instead of potatoes, KFC offers customers a
potato and onion croquette. In France, KFC sells pastries alongside its chicken. KFC exhibits an
understanding of and appreciation for the __________ of other societies.
a.
b.
c.
d.
e.
demographics
symbols
customs
sensitivities
selective perception
18. Producing goods in one country and selling them in another country is called:
a.
b.
c.
d.
e.
foreign exchange.
countertrading.
transporting.
exporting.
facilitating.
19. When __________, a company contracts with an individual to set up an operation to provide
products or services under the company’s established brand name.
2
a.
b.
c.
d.
e.
contract manufacturing
franchising
joint venturing
foreign assembling
contract assembling
Chapter 8
IDENTIFYING MARKET SEGMENTS AND TARGETS
28. Market segmentation involves aggregating prospective buyers into groups that have common
needs and will:
a.
b.
c.
d.
e.
pay attention to marketing messages.
respond similarly to a marketing action.
be responsive to marketing research.
use the same payment methods.
go shopping on a regular basis.
29. When a firm produces only a single product or service and attempts to sell it to two or more
market segments, it avoids __________, which often results extremely high research,
engineering, and manufacturing expenses.
a.
b.
c.
d.
e.
the extra cost of developing and producing additional versions of the product
creating a service gap
indirect distribution and logistics problems
strategic planning
amortization costs
30. Kellogg's different types of cereals, each targeted at a different type of user, are an example of
multiple products aimed at multiple markets. Manufacturing these different cereals is clearly
more expensive than producing one but seems worthwhile if it serves customers' needs better,
doesn't reduce quality or increase price, and:
a.
b.
c.
d.
e.
conforms to all union regulations.
reduces the number of employees required.
decreases the cost of the physical plant.
stabilizes the sales revenues and profits.
adds to the manufacturer's sales revenues and profits.
31. Yahoo's shopping portal recently began to offer people who visited the site the ability to buy
songs from Imix's collection of more than 200,000 tracks from record labels that include BMG
and Sony Music Group. Customers can choose up to 70 minutes of music for around $1 per song.
Then they can choose an art design and a title for each CD and have a disc shipped for $2.50.
This is an example of:
a.
mass customization.
3
b.
c.
d.
e.
how the 80/20 rule is implemented.
market augmentation.
market melding.
repositioning.
32. Two general categories used to segment consumer markets are __________ and buying
situations.
a.
b.
c.
d.
e.
demand frequency
demand volume
demand characteristics
customer characteristics
customer lifestyles
33. Which of the following statements demonstrates the formation of a segment based on region?
a.
b.
c.
d.
e.
In China KFC sells a much spicier chicken the farther away its restaurants are from the
coastal areas.
GE built a downsized microwave oven to hang under kitchen cabinets.
Del Monte offers a line of canned fruit with no added sugar or artificial sweeteners.
A fast food hamburger restaurant is open for breakfast on Sunday mornings but not on
weekdays.
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.
34. When a telemarketer calls to sell a consumer vinyl siding for his or her home, the first question
the telemarketer asks is if the person answering the phone is a homeowner. Whether the prospect
is a homeowner indicates the use of which type of consumer segmentation variable?
a.
b.
c.
d.
e.
usage
behavior
demographic
buying situation
psychographic
35. Consumer activities, interests, and opinions are considered:
a.
b.
c.
d.
e.
psychological variables.
consumer behavior.
attitudes.
psychographic variables.
demographic variables.
36.Nyquil advertises that it alleviates “the nighttime, sniffling, sneezing, coughing, aching, stuffy head,
fever” and helps you get the rest you need to get better. Nyquil uses a segmentation strategy
based on __________ variables.
a.
b.
c.
d.
geographic
socioeconomic
benefits sought
product knowledge
4
e.
demographic
37. Miller beer once called itself "the champagne of bottled beer," and ads showed elegant women in
long white dresses sipping beer from crystal goblets. Then the company discovered that most
beer in the U.S. is consumed by men 18 to 30 years of age, and it changed the thrust of its
marketing message to reflect the more productive target market. What segmentation variable has
it focused on with the newer approach?
a.
b.
c.
d.
e.
benefits sought
usage
product awareness
buyer intentions
buying condition
38. A national car rental firm targets 50 percent of its advertising to salespeople who travel more than
1,000 miles per week. Its market is segmented by:
a.
b.
c.
d.
e.
usage.
benefits offered.
demographics.
family size.
psychographics.
39. The 80/20 rule is a concept, which suggests:
a.
b.
c.
d.
e.
eighty percent of a firm's inventory should be readily available, and twenty percent should be
reserved for emergency demand.
eighty percent of a firm's first time users will become brand loyal and twenty percent of the
firm's first time users will use the product only once.
eighty percent of a firm's sales are obtained from twenty percent of its customers.
eighty percent of a firm's expenditures are tax deductible and twenty percent are not.
eighty percent of a firm's products will ultimately be sold at the original markup price, and
twenty percent will not.
40. When evaluating entry into the large Boston market, Seattle-based Starbucks Coffee Company
found that Coffee Connection, a well-established local chain, already occupied many prime
locations. Starbucks entered the market anyway because it based its decision on:
a.
b.
c.
d.
e.
number of employees, a geographic variable.
the NAICS code, a demographic variable.
population density, a location variable.
nature of good, a customer characteristic variable.
buying conditions, a demographic variable.
41. Which of the following is a criterion used for selecting a target segment?
a.
b.
c.
d.
e.
size of the market
expected growth
cost of reaching the segment
compatibility with the organization’s objectives and resources
All of the above are used for selecting a target segment.
5
42. Kellie Johnson makes jams and jellies that sell under the brand name of Yesterday's Kitchen. In
developing a marketing strategy to sell her product line, she decided to buy an ad in the local
shopper's newspaper that is well-read in her region of the country. Johnson has just:
a.
b.
c.
d.
e.
selected target market segments to reach.
formed products to be sold into groups.
developed a market-product grid and estimating size of markets.
taken marketing actions to reach target markets.
formed prospective buyers into segments.
43. There are a lot of skateboard manufacturers on the market, but the BMW Streetcarver is the only
one with stabilizers and wheel design based on BMW's automobile. This technology gives the
BMW Streetcarver better control at high speeds and around sharp turns than any other brand.
What type of positioning is BMW using with its $495 skateboard?
a.
b.
c.
d.
e.
parallel market positioning
distinction positioning
competitive positioning
product positioning
head-to-head positioning
ANSWERS
10.B
11.B
12.C
13.B
14.D
15.B
16.A
17.C
18.D
19.B
28.B
29.A
30.E
31.A
32.D
33.A
34.C
35.D
36.C
37.B
38.A
39.C
40.C
6
41.E
42.D
43.D
Chapter 9
DEVELOPING NEW PRODUCTS AND SERVICES
1. A __________ is a group of products—goods or services—that are closely related because they
satisfy a class of needs, are used together, are sold to the same customer group, are distributed
through the same types of outlets, or fall within a given price range.
a.
b.
c.
d.
e.
product class
product mix
product line
marketing mix
product category
2. Among consumer goods, personal selling is especially important for:
a.
b.
c.
d.
e.
nondurable goods.
unsought goods.
durable goods.
services.
semidurable goods.
3. Intangible items such as airline trips, financial advice, or telephone calls that an organization
offers for sale are called:
a.
b.
c.
d.
e.
production goods.
durable goods.
services.
goods.
capacities.
4. The elements that make services unique are the four I's. The four I's are:
a.
b.
inflexibility, intangibility, inconsistency, and inseparability.
intangibility, inconsistency, inseparability, and inventory.
7
c.
d.
e.
incompatibility, inconsistency, inseparability, and inventory.
invisibility, inconsistency, inseparability, and intangibility.
inflexibility, incongruity, inconsistency, and inventory.
5. Sarah has a backache due to overexertion. She believes a massage would loosen her back
muscles and make her feel better. She is concerned because a massage, unlike a pair of shoes,
cannot be felt before she buys it. Which characteristic of services is she concerned about?
a.
b.
c.
d.
e.
incongruity
inconsistency
inventory costs
inseparability
intangibility
6. Don is graduating and takes his relative to dinner after the ceremony. At the restaurant, the
waitperson never fills up their water glasses, ignores their requests and seems to "forget" about
their table. Don notes that the last time he was at this same restaurant the experience was
completely different (and MUCH better). This scenario illustrates the __________ of services.
a.
b.
c.
d.
e.
perishability
intangibility
inconsistency
inseparability
uniqueness of the service
7. The emergency room staff in Houston's largest hospital is surprised and pleased when a four-day
Fourth of July weekend brings many fewer accident victims in for treatment. They know from
experience that such public holidays have high rates of accidents. For the hospital business
office, the lower demand for the emergency room facilities means:
a.
b.
c.
d.
e.
a break in the service continuum.
its services are no longer tangible.
its services can be separated from the staff.
the hospital has idle production capacity.
an opportunity for gap analysis.
8. Which of the following is the best example of a convenience good?
a.
b.
c.
d.
e.
Sony CD player
Lexus LS 400 luxury automobile
flight on American Airlines
Roget's Thesaurus
Ivory soap
9. Which of the following is the best example of a specialty good?
a.
b.
c.
d.
e.
a CD player
a Lexus LS 400 luxury automobile
an airline flight to Orlando, Florida
a dictionary
liquid soap.
8
10. Very infrequent purchases and only some comparison shopping are characteristic of the
purchasing behavior for a type of consumer good such as burial insurance that a prospective
buyer may not initially want. These are called:
a.
b.
c.
d.
e.
shopping goods.
convenience goods.
specialty goods.
unsought goods.
support goods.
11. A major characteristic of business goods is that their sales are often the result of __________; that
is, sales of industrial products frequently result from the sale of consumer goods.
a.
b.
c.
d.
e.
unit demand
contrived demand
derived demand
primary demand
secondary demand
12. Wax used by Carolina Candle Company for making candles would most likely be classified as
which type of good?
a.
b.
c.
d.
e.
production goods
specialty goods
support goods
convenience goods
unsought goods
13. What do an automated carwash and a utility have in common?
a.
b.
c.
d.
e.
They are both tangible services.
They are both people-based services.
Neither of them has problems with idle production capacity.
They are both equipment-based services.
They never use off-peak pricing.
14. The U. S. Federal Trade Commission considers a product new only:
a.
b.
c.
d.
e.
for a period of six months after it enters regular distribution.
for a period of one year after it enters regular distribution.
until a similar product is introduced by a competitor.
until a newer version of the same product is produced.
for a period of seventeen years at which time patent rights are returned to the public domain.
15. When automakers first added airbags to the passenger side of the automobile it was an example of
what is called a __________ because no new consumer behaviors must be learned.
a.
b.
c.
continuous innovation
dynamically continuous innovation
discontinuous innovation
9
d.
e.
insignificant innovation
interruptive innovation
16. The emphasis of a marketing strategy for a dynamically continuous innovation would include:
a.
b.
c.
d.
e.
advertising to generate awareness.
obtaining widespread distribution.
advertising to explain product features and their advantages.
setting the price low.
advertising to remind consumers.
17. Napster software allowed an individual to easily search and swap MP3 (a technique for
compressing files into a size that moves faster on the Internet) musical files with other
individuals. When it was introduced, it was an example of a:
a.
b.
c.
d.
e.
continuous innovation.
dynamically continuous innovation.
dramatically continuous innovation.
discontinuous innovation.
distinct innovation.
18. When General Foods introduced Post Cereals with freeze-dried fruits, people found that by the
time the fruit had absorbed enough milk, the flakes were soggy. Why did this product fail?
a.
b.
c.
d.
e.
poor product quality
insignificant point of difference compared to competitive offerings
too little market attractiveness
poor execution of the marketing mix
no economical access to buyers
19. Assume that, as marketing director for Mazda, you see your sales decreasing in the years since
the Honda Prelude with four-wheel steering was introduced. If you hope to regain sales in this
market quickly through a new-product action, the most valuable sources of ideas would be:
a.
b.
c.
d.
e.
consumer suggestions.
employee suggestions.
research and development breakthroughs.
competitive products.
outside consultants.
20. At Fisher-Price, new product prototypes are child-tested in special testing playgrounds during the
__________ stage in the new-product process.
a.
b.
c.
d.
e.
new-product strategy
development
business analysis
screening and evaluation
market testing
21. When audiences are allowed to preview actual movies such as Lord of the Rings:The Two Towers
and Chicago before they are released to the general public it is a part of the __________ stage of
10
the new-product process.
a.
b.
c.
d.
e.
market testing
business analysis
commercialization
screening and evaluation
concept testing
22. Introducing new-products sequentially into geographic areas of the U.S. to allow production
levels and marketing activities to build up gradually is called:
a.
b.
c.
d.
e.
limited rollouts.
phased geographic rollouts.
market-product expansion.
regional rollouts.
phased commercialization.
23. In which of the following examples would a consumer have difficulty separating the deliverer of
the service from the service itself?
a.
b.
c.
d.
e.
a dental visit
a golf lesson
a university marketing class
a haircut
all of the above
24. In terms of promotion, which of the following types of goods stress status and uniqueness of
brand?
a.
b.
c.
d.
e.
shopping goods
convenience goods
specialty goods
unsought goods
services
25. What do a home-healthcare nurse, a tutor, and a financial consultant have in common?
a.
b.
c.
d.
e.
They are all tangible services.
They are all people-based services.
They do not have problems with idle production capacity.
They are all equipment-based services.
They never use off-peak pricing.
26. In the early 1900s, your great-grandfather probably purchased his first automobile. After years of
driving horses and buggies, your great-grandfather got in his new car and drove it into his new
garage. Great-grandfather's new automobile was an example of a:
a.
b.
c.
d.
continuous innovation.
dynamically continuous innovation.
dramatically continuous innovation.
discontinuous innovation.
11
e.
distinct innovation.
27. The emphasis of a marketing strategy for a discontinuous innovation would most likely be to:
a.
b.
c.
d.
e.
generate awareness among consumers.
advertise benefits to consumers.
educate consumers about entirely new consumption patterns through product trial and
personal selling.
obtain widespread distribution.
stress points of difference.
28. The probability that a new product will be a success is greater if it:
a.
b.
c.
d.
e.
is a uniquely superior product.
well-defined product before actual development starts
fits with its company's marketing mix activities.
appeals to a large market with high growth potential.
does all of the above.
29. An external evaluation that consists of preliminary testing of a new-product idea (rather than the
actual product) with consumers is called:
a.
b.
c.
d.
e.
new-product strategy development.
idea generation.
alternative evaluation.
a concept test.
market testing.
30. Breyer's introduced for sale a new line of ice cream flavors 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.
a.
b.
c.
d.
e.
commercialization
screening and evaluation
business analysis
development
market testing
ANSWER KEY
1.c
2.c
3.c
4.b
5.e
6.c
7.d
8.e
9.b
12
10.d
11.c
12.a
13.d
14.a
15.a
16.c
17.d
18.a
19.d
20.b
21.a
22.d
23.e
24.c
25.b
26.d
27.c
28.e
29.d
30.e
Chapter 10
MANAGING PRODUCTS, SERVICES, AND BRANDS
31. Lack of profit in the introductory stage of the product life cycle is very often the result of:
a.
b.
c.
d.
e.
insufficient allocation of resources to the marketing mix.
poor selection of distribution channels.
high taxes.
large investment costs in product development.
ineffective execution of the marketing program.
32. Gillette spent $35 million in advertising to introduce the Sensor razor to consumers. Such
expenditures are often made to stimulate __________, or desire for the product class, rather than
for a specific brand, when there are no competitors with the same product.
a.
b.
c.
d.
e.
additional marketing research
innovative sampling
primary demand
initial data gathering
repeat purchase
33. 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.
a.
selective
13
b.
c.
d.
e.
primary
derived
generic
secondary
34. During the introduction stage of the product life cycle, __________ may be used used. This
pricing strategy charges a high price to recoup the costs of product development.
a.
b.
c.
d.
e.
penetration pricing
cost-plus pricing
ROI pricing.
market-oriented pricing
skimming pricing
35. To discourage competitive entry, a company can price its new product low, using penetration
pricing. This pricing strategy also helps to:
a.
b.
c.
d.
e.
reduce costs.
increase profits.
build customer loyalty.
improve product quality.
build unit volume.
36. Opera.com introduced a new Web browser that can be easily customized to do what you want it
to do—such as suppress all pop-up ads and retrieve previously visited websites quickly. Opera is
spending a lot of money to make potential consumers aware of the existence of a Web browser
that can be customized. Sales have been slow to rise over the past year, and profit has yet to be
achieved. In what stage of the product life cycle is this product category?
a.
b.
c.
d.
e.
growth stage
decline stage
commercialization stage
maturity stage
introduction stage
37. Which of the following is a characteristic of the growth stage of the product life cycle?
a.
b.
c.
d.
e.
advertising emphasis switches to primary demand
growing proportion of initial purchasers to repeat purchasers
slow, steady sales
competitors appear
pricing is more aggressive
38. The marketing objective of a firm whose product is in the maturity stage of the product life cycle
is to:
a.
b.
c.
d.
e.
actively search out new first time users.
maintain existing buyers since new ones are hard to find.
actively reinforce competitors' marketing efforts.
maintain existing distributors and actively seek out new ones.
shift to a skimming price strategy.
14
39. In the 1960s, television westerns were extremely popular. The shows were adventure shows with
settings and costumes that were very unlike what really existed. There was Bonanza, Wagon
Train, The Virginian, Laramie, etc. When viewers gradually stopped watching this category of
programs, production companies found the networks no longer wanted to televise such shows.
The television western as a product category entered the __________ stage.
a.
b.
c.
d.
e.
decay
decommercialization
decline
maturity
harvested
40. During the 1990s, there was a backlash against artificial colors in food and other consumer
products. As a result, a lot of companies issued products that were clear. One example was
Crystal Pepsi. The product never really found a market and was __________, or dropped from
the Pepsi product line soon after its introduction.
a.
b.
c.
d.
e.
diversified
aggregated
segmented
deleted
harvested
41. There is no exact time that a product takes to move through its life cycle. As a rule:
a.
b.
c.
d.
e.
fad products have the longest lifecycle.
consumer products have shorter life cycles than business products.
packaged goods have a shorter life cycle than fads.
installations have a shorter life cycle than consumer products.
intangibility shortens the product life cycle.
42. An alternative product life cycle that results from products that are easily imitated by competitors,
consumers who readily understand their benefits, and for which the appropriate marketing
strategy is to gain strong distributor outlets is characteristic of __________ products.
a.
b.
c.
d.
e.
high learning
low learning
fashion
fad
substitute
43. The largest numbers of product adopters with respect to the diffusion of innovation are found
among:
a.
b.
c.
d.
e.
early adopters and laggards.
early majority and late majority.
late majority laggards.
innovators and early majority.
innovators and early adopters.
15
44. 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.
b.
c.
d.
e.
a market-product strategy.
diversification.
market modification.
product modification.
harvesting.
45. DiGiorno rising crust pizza has been available in the freezer sections of supermarkets for quite a
while. The product's recent introduction of a DiGiorno cheese stuffed crust is an example of
__________ and should attract new buyers.
a.
b.
c.
d.
e.
a market-product strategy.
diversification.
market modification.
product modification.
harvesting.
46. Snickers candy bar was repositioned from a candy bar to a snack food through commercials that
showed busy people satisfying their hunger with a Snickers bar. Mars, Inc. used this strategy
with its Snickers bar to:
a.
b.
c.
d.
e.
react to a competitor's position.
reach a new market.
catch a rising trend.
change the value offered.
do none of the above.
47. Which of the following product repositioning strategies requires a change in the physical
product?
a.
b.
c.
d.
e.
increasing use
creating new use situations
finding new users
reacting to a competitor’s position
changing the value offered
48. Multiproduct branding is:
a.
b.
c.
d.
e.
a statement indicating the liability of the manufacturer for product deficiencies.
a strategy where products are given no identifying names other than a description of their
contents.
a branding strategy in which a company uses one name for all of its products.
a branding strategy in which manufacturers produce products but sell them under the brand
name of a wholesaler or retailer, also called private labeling or reseller branding.
a contractual agreement whereby a company allows someone else to use its brand name and
usually requires that the product be made to its specifications.
16
49. When a company uses line extension it is:
a.
b.
c.
d.
e.
manufacturing a product under a new brand name that consumers will view as an entirely
new product line.
using a current brand name to enter a new market segment in its product class.
speeding up the movement of a product category through its PLC.
contracting with another firm to manufacture modified versions of the original products.
applying the current brand name to enter a completely different product class.
50. Seiko makes watches. It markets its higher quality watches under the Sieko or Lasalle name, and
its lower-priced watches are sold under the Pulsar brand. Seiko uses a __________ strategy.
a.
b.
c.
d.
e.
multibranding
generic branding
multiproduct branding
trademarked branding
private branding
51. Which of the following statements about packaging is true?
a.
b.
c.
d.
e.
Packaging can have brand equity benefits for the company.
Consumer protection is an important function of packaging.
Packaging can give the idea of status, economy, and product quality.
Packaging can be used to extend shelf life.
All of the above statements about packaging are true.
52. The popular "Got Milk" advertising campaign was sponsored by the National Milk Board to
encourage more people to drink milk. This ad campaign stimulated __________ demand.
a. selective
b. primary
c. derived
d. generic
e. secondary
53. As competitors introduce their own products, and the product progresses along its life cycle,
company attention is focused on creating __________ demand, or demand for a specific brand.
a.
b.
c.
d.
e.
selective
primary
derived
generic
secondary
54. Which of the following statements about the introduction stage of the product life cycle is true?
a.
b.
c.
d.
e.
During the introduction stage, efforts are made to increase primary demand.
During the introduction stage, firms may choose a skimming pricing strategy.
During the introduction stage, firms may choose a penetration pricing strategy.
Generally the promotional message is to inform and educate the consumer.
All of the above statements about the introduction stage of the product life cycle are true.
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55. Which stage in the product life cycle is characterized by a rapid increase in sales and the
appearance of competitors?
a.
b.
c.
d.
e.
introduction
growth
maturity
decline
profit
56. Promotional expenses at the maturity stage of the product life cycle are often directed towards:
a.
b.
c.
d.
e.
creating demand for the product class.
reminding the consumer to use the product.
creating primary demand.
gaining new distributors.
eliminating distribution channels.
57. An extended introduction stage of the product life cycle occurs for which type of product?
a. high learning
b. low learning
c. fashion
d. fad
e. revolutionary
58. Which type of product has experiences rapid sales on introduction and then an equally rapid
decline of the product life cycle?
a.
b.
c.
d.
e.
high learning products
low learning products
fashion products
fad products
abnormal products
59. The life cycle of a product depends on sales to customers. The shapes of life-cycle curves
indicate that most sales occur after the product has been on the market for some time. The
concept that some people are attracted to a product early while others buy it only after they see
their friends with the product is called the:
a.
b.
c.
d.
e.
dissociation of sensibility.
timed profiling.
categories of adopters.
diffusion of innovation.
derivation of markets.
60. Tums, which has long been used for reducing heartburn, is now being promoted as a source of
calcium for the prevention of osteoporosis. Its manufacturer is using which of the following
market modification strategies?
a.
finding new users
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b.
c.
d.
e.
creating new use situations
increasing use by existing customers
modifying the product characteristics
doing none of the above
61. When consumers think of Harley-Davidson, the image of a masculine, non-conformist is the
likely associated with that brand name. With the Vespa motorscooters, the image is more likely
to be a brainy environmentalist that wears polyester and socks that don't match. Both Vespa and
Harley-Davidson:
a.
b.
c.
d.
e.
have brand personalities.
have created brand mannerisms.
are symbolic brands.
use brand personification.
use product personification.
62. All products sold by the Tabasco Company are sold using the Tabasco brand. This is an example
of:
a.
b.
c.
d.
e.
multiproduct licensing.
multibranding.
co-branding.
generic branding.
multiproduct branding.
63. Thirty-six percent of sales at supermarkets in the United Kingdom carry the stores' own brand
names. Eighteen percent of all supermarket sales in France and Germany carry the stores' own
brand names; and in the US, 14 percent do. These supermarkets are using a __________ strategy
to sell consumer food.
a.
b.
c.
d.
e.
private branding
generic branding
multibranding
co-branding
multiproduct branding
ANSWER KEY
31.d
32.c
33.a
34.e
35.e
36.e
37.d
38.b
39.c
40.d
41.b
42.b
43.b
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44.d
45.d
46.b
47.e
48.c
49.b
50.a
51.e
52.b
53.a
54.e
55.b
56.b
57.a
58.d
59.d
60.b
61.a
62.e
63.a
Chapter 15
ADVERTISING, SALES PROMOTION, AND PUBLIC RELATIONS
22. An ad for Campbell's soup reads, “We haven't changed that great taste your family's always
loved.” This is an example of __________ advertising.
a.
b.
c.
d.
e.
advocacy
comparative
persuasive
informative
reminder
23. The testimonial type ads for carbon dioxide detectors feature parents who are discussing the
dangers of carbon monoxide poisoning. In many of the ads, the homeowners tell the target
audience how disaster can be averted by purchasing and using the advertised product. Such
advertisements are using:
a.
b.
c.
d.
e.
fear appeals.
sex appeals.
humorous appeals.
family appeals.
coercive appeals
24. An ad for Hydrozycut, an advanced weight loss formula by GNC, shows an attractive woman
who claims that she lost “an incredible 23 pounds.” This ad is using a:
a.
rhetorical appeal.
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b.
c.
d.
e.
life cycle appeal.
humorous appeal.
sex appeal.
fear appeal.
25. __________ is defined as the number of different people or households exposed to an
advertisement.
a.
b.
c.
d.
e.
Scope
Share
Reach
Span
Rating
26. __________ is defined as the percentage of households in a market that are tuned to a particular
television show or radio station.
a.
b.
c.
d.
e.
Gross rating points
Reception rate
Target audience reach
Rating
Share
27. CPM with respect to advertising is defined as the:
a.
b.
c.
d.
e.
cost of one medium relative to the cost of other media (e.g. direct mail versus television,
radio, or outdoor), each of which are divided by the multiple of their respective reach and
frequency.
reach multiplied by frequency divided by the cost of reaching 1000 individuals or households
with the advertising message.
cost of reaching 1000 individuals or households with the advertising message.
cost per minute of television or radio time
number of consumers exposed to an advertising message, in thousands.
28. Billboard advertising is most effective for __________ advertising.
a.
b.
c.
d.
e.
pioneering
advocacy
reminder
comparative
differentiation
29. The three approaches to setting advertising schedules are:
a.
b.
c.
d.
e.
flexible, seasonal, and continuous.
sweeping, bursting, and pulsing.
flighting, pulse, and continuous.
continuous, seasonal, and sweeping.
incessant, intermittent, and infrequently.
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30. A __________ schedule is used when seasonal factors are unimportant.
a.
b.
c.
d.
e.
continuous
flighting
intermittent
pulse
burst
31. Tests conducted before an advertisement is placed in any medium to determine whether the
advertisement communicates the intended message or to select between alternative versions of the
advertisement are called:
a.
b.
c.
d.
e.
preliminary screenings.
experience testing.
exposure testing.
pretests.
posttests.
32. Theater tests:
a.
b.
c.
d.
e.
present a panel of consumers with an ad and ask for their reactions concerning the ad's
effectiveness, appeal, etc.
present a panel of consumers with an ad for a limited period of time. The ad is then removed,
and the respondents are asked to recall as much pertinent information as possible.
present consumers with a sample of a product and several different advertisements for the
product. They are asked to select the one they think is most effective and explain why.
present consumers with a hidden ad, which they are asked to recall.
use electronic devices during or questionnaires after consumers view a TV advertisement to
measure viewer response or feelings.
33. By placing an ad in the Sunday paper with an offer to save $.25 if you clip the ad and use it at the
supermarket for your next purchase of Birdseye lima beans, Birdseye is using a __________ to
stimulate demand for its lima beans.
a.
b.
c.
d.
e.
rebate
sample
coupon
deal
premium
34. The sign at the entrance to the men's store reads, "Buy one shirt, get a second shirt of equal or
lower value for only one dollar." Which type of sales promotion is the men's store is using?
a.
b.
c.
d.
e.
a deal
a contest
a premium
a rebate
a sample
35. As Roderick was checking out of Office Depot, the sales clerk said, “You'll probably want to take
advantage of this offer.” The offer read, "Mail in three UPCs and cash register tapes with the
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prices circled to receive a check for $25." The offer was an example of a:
a.
b.
c.
d.
e.
point-of-purchase.
deal.
coupon.
rebate.
premium.
36. __________ are programs in which a manufacturer pays a percentage of a retailer's local
advertising expense for advertising the manufacturer's products.
a.
b.
c.
d.
e.
Trade promotion programs
Consumer promotion programs
Cooperative advertising programs
Cause-related marketing programs
Shared-responsibility programs
KEY:
22.E
23.A
24.D
25.C
26.D
27.C
28.C
29.C
30.A
31.D
32.E
33.C
34.A
35.D
36.C
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