Shortly after World War II by OCrSjyK3

VIEWS: 500 PAGES: 62

									                          CHAPTER 1
DEVELOPING CUSTOMER RELATIONSHIPS AND VALUE THROUGH MARKETING

                           MULTIPLE CHOICE QUESTIONS


1-1 CHAPTER OPENING EXAMPLE: ROLLERBLADE                                            DEFINITION

   Fusion, Core, and Lightening are:
   a. the three primary competitors of Rollerblade, Inc.
   b. companies that make in-line skating accessories.
   c. companies that provide world-wide in-line skating vacations.
   d. in-line skate innovations designed and marketed by Rollerblade, Inc.
   e. nicknames of three professional in-line skaters.

   Answer: d Page: 7
   Rationale: Fusion and Core products are targeted at the fitness segment and the Lightning
   product is targeted at the speed segment.

1-2 CHAPTER OPENING EXAMPLE: ROLLERBLADE                                          CONCEPTUAL

   In the 1980's, marketing director Mary Horvath and Rollerblade succeeded in popularizing
   in-line skating. The primary challenge to Rollerblade, Inc. in the late 1990's and into the next
   century will be:
   a. protecting itself from liability for all the in-line skating injuries.
   b. tapping into the preschool segment of the population.
   c. getting the aging population to try the sport.
   d. dealing with an increasing number of competitors.
   e. setting up the Extreme Games Competition twice a year.

   Answer: d Page: 7
   Rationale: Rollerblade, Inc. has over 30 competitors as the 21st century begins. One danger of
   being successful in launching an industry is the increase of competition in the industry.

1-3 CHAPTER OPENING EXAMPLE: ROLLERBLADE                                            DEFINITION

   When Mary Horvath took over marketing for Rollerblade skates, her first task was
   repositioning. This means she had to:
   a. change consumers' perceptions of Rollerblade skates.
   b. implement strategic marketing planning.
   c. develop new products and new markets for Rollerblade skates.
   d. sponsor an event that would create publicity for Rollerblade, Inc.
   e. determine if a market existed for Rollerblade skates.

   Answer: a Page: 7
   Rationale: Repositioning the product means changing the image people have in their minds
   about the product.



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1-4 CHAPTER OPENING EXAMPLE: ROLLERBLADE                                           APPLICATION

   Rollerblade, Inc.'s strategy changed from the late 1980's to the late 1990's. Applying this
   change to other companies and their marketing strategies suggests that organizations should:
   a. find a winning strategy and stick with it.
   b. search continuously for ways to provide value to customers.
   c. change strategies every ten years to avoid getting complacent.
   d. not pay too much attention to customers since they often change their minds.
   e. focus on the shareholder of the company and the strategy will follow.

   Answer: b Page: 7
   Rationale: The future of a company relies on an in-depth understanding of the customers. In
   order to survive, organizations must search continuously for ways to provide value to their
   customers.

1-5 WHAT IS MARKETING?                                                             CONCEPTUAL

   A study of marketing can:
   a. enable you to be a more informed citizen.
   b. help you in your career.
   c. demonstrate how marketing affects your life.
   d. make you a better consumer.
   e. do all of the above.

   Answer: e Page: 7
   Rationale: Marketing affects all individuals, all organizations, all industries, and all countries.

1-6 WHAT IS MARKETING?                                                             CONCEPTUAL

   You are already a marketing expert because:
   a. as a consumer, you have been involved already in marketing.
   b. marketing is really only common sense.
   c. as a college student, you study marketing.
   d. there is really nothing to learn about marketing.
   e. marketing is innate knowledge that all are born with.

   Answer: a Page: 7
   Rationale: As a consumer, you have already been involved in thousands of marketing
   decisions—but mainly on the buying, not the marketing side.




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1-7 TRADEMARKS AND BRAND NAMES                                                     APPLICATION

   Under American trademark law, if customers generally start using the word rollerblading to
   describe skating on in-line skates regardless of the brand used:
   a. Rollerblade, Inc. will still retain exclusive right to that name.
   b. Rollerblade, Inc. is entitled to royalty payments from any company whose customers
       purchase their brand of in-line skates since Rollerblade developed the in-line skate industry.
   c. Rollerblade, Inc. could lose its exclusive rights to the name.
   d. the repositioning strategy that Rollerblade uses will become ineffective.
   e. Rollerblade, Inc. is pleased because it increases name recognition, and therefore, sales.

   Answer: c Page: 8 Other Locations: SG
   Rationale: Under American trademark law, if consumers generally start using a brand name as
   a generic term to describe the product rather than the source of the product then the company
   loses its exclusive rights to the name.

1-8 TRADEMARKS AND BRAND NAMES                                                       DEFINITION

   Under American trademark law, a business loses the right to its trademark when:
   a. it can't pay the taxes on the trademark.
   b. the name is used without a copyright symbol.
   c. the public uses the name as a generic term.
   d. it stops producing the product.
   e. its patent expires.

   Answer: c Page: 8
   Rationale: Under American trademark law, if consumers generally start using a brand name as
   a generic term to describe the product rather than the source of the product, then the company
   loses its exclusive rights to the name.




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1-9 TRADEMARKS AND BRAND NAMES                                                   APPLICATION

    Kleenex tissue is not happy when a novel writer has her heroine reaching for a Kleenex to dab
    her teary eyes. Its manufacturer Kimberly-Clark has attorneys on staff to send reminders to the
    author and others that Kleenex is a brand name and not a generic term. Why?
    a. If Kimberly-Clark does not make an effort, then the federal government will not actively
         protect its patent.
    b. The Kleenex name is worth millions, and the company is responsible for protecting its own
         brand name.
    c. Kimberly-Clark is simply showing its muscle as the number one paper manufacturer in the
         world.
    d. By law, Kimberly-Clark is required to protect its copyrighted brand strategy.
    e. None of the above explains why Kimberly-Clark would maintain lawyers who would send
         reminders on how to use the brand name.

    Answer: b Page: 8-9 Other Locations: W
    Rationale: Under American trademark law, if consumers generally start using a brand name as
    the generic term to describe the product rather than its source, than the company loses the
    exclusive rights to the name.

1-10 MARKETING NEWSNET                                                           CONCEPTUAL

    Critics of branding contend that:
    a. the owners of major national brands are improving the economic infrastructure of third
         world nations.
    b. branding should not be accountable to consumers.
    c. branding is a form of consumer protection.
    d. the globalization of brands is actually undermines our moral values.
    e. branding is not a form of consumer exploitation.

    Answer: d Page: 9
    Rationale: Critics of branding view the “McDonaldization of the globe” as consumer
    exploitation.

1-11 MARKETING NEWSNET                                                           CONCEPTUAL

    Supporters of branding contend that:
    a. branding is a form of consumer exploitation.
    b. the globalization of brands actually undermines worldwide moral values.
    c. branding simplifies our choices and guarantee consistent quality.
    d. branding is not a tool for protecting consumers.
    e. branding has undermined U.S. moral values over the last century.

    Answer: c Page: 9
    Rationale: Supporters contend that firms spend millions of dollars to protect their brand names
    to assure consumers get what they think they are buying.



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1-12 MARKETING                                                                        DEFINITION

    _____ is the process of planning and executing the conception, pricing, promotion, and
    distribution of ideas, goods, and services to create exchanges that satisfy individual and
    organizational objectives.
    a. Creative planning
    b. Advertising
    c. Selling
    d. Marketing
    e. Consumerism

    Answer: d Page: 9 Other Locations: W
    Rationale: Key term definition—marketing

1-13 MARKETING                                                                     CONCEPTUAL

    To serve both buyers and sellers, marketing seeks to discover the needs and wants of
    prospective customers and to:
    a. change them.
    b. take advantage of them.
    c. satisfy them.
    d. manipulate them.
    e. define real and artificial buying situations.

    Answer: c Page: 9
    Rationale: Prospective customers include both individuals buying for themselves and their
    households, and organizations that buy for their own use or for resale.

1-14 PROSPECTIVE CUSTOMERS                                                            DEFINITION

    Prospective customers include:
    a. individuals buying for themselves.
    b. individuals buying for their households.
    c. organizations that buy for their own use (such as manufacturers).
    d. organizations that buy for resale (such as wholesalers and retailers).
    e. all of the above.

    Answer: e Page: 9
    Rationale: Prospective customers include both individuals buying for themselves and their
    households, and organizations that buy for their own use (such as manufacturers) or for resale
    (such as wholesalers and retailers).




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1-15 PROSPECTIVE CUSTOMERS                                                            APPLICATION

    Prospective customers for a waterproof marker that can be erased as simply as if it were a pencil
    would include:
    a. supermarkets that create and post hand-lettered signs weekly.
    b. students who are making signs for a bake sale.
    c. children who like to draw.
    d. delivery company employees who mark location zones on packages.
    e. all of the above.

    Answer: e Page: 9 Other Locations: SG
    Rationale: Prospective customers include anyone who could benefit from owning a product.

1-16 EXCHANGE                                                                            DEFINITION

    Marketing seeks to discover the needs and wants of prospective customers and satisfy them.
    Essential to this process is the idea of exchange. To marketing people exchange refers to the:
    a. place where people go to do business.
    b. place where people return unwanted goods.
    c. process whereby a buyer and seller trade something of value.
    d. process of locating buyers and sellers.
    e. acquisition of something of value.

    Answer: c Page: 10
    Rationale: Key term definition—exchange

1-17 EXCHANGE                                                                            DEFINITION

    _____ is a trade between a buyer and a seller of things of value so that each is better off after the
    trade than before.
    a. Exchange
    b. Needs assessment
    c. Consumerism
    d. Utility
    e. Commerce

    Answer: a Page: 10
    Rationale: Key term definition—exchange




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1-18 EXCHANGE                                                                       APPLICATION

    The American Red Cross created a series of advertisements encouraging viewers to donate
    blood. After viewing the advertisement, Amanda went to the local Red Cross office and
    donated a pint of blood. Afterwards, Amanda returned home feeling satisfied that she had
    performed a good deed. Was this a marketing exchange?
    a. no, because the Red Cross is non-profit organization.
    b. yes, because the Red Cross ran an advertisement.
    c. yes, because the donated blood was exchanged for a feeling of satisfaction.
    d. no, because no money was exchanged.
    e. no, because the Red Cross did not provide Amanda with a product.

    Answer: c Page: 10
    Rationale: Marketers seek to discover and satisfy the needs and wants of customers. The key to
    achieving these objectives is exchange—the trade of things of value between buyer and seller so
    that each benefits from the exchange. In this instance, Amanda is the customer and the Red
    Cross is the marketer. An exchange occurs: Amanda exchanges her donated blood for a feeling
    of satisfaction; the Red Cross receives the donated blood and continues its readiness to serve the
    needs of society in times of disaster.

1-19 EXCHANGE                                                                       APPLICATION

    A church has put advertisements in its weekly bulletins to encourage members of the church to
    participate in the services by reading. Jack volunteered and read during a service. He felt
    satisfied and felt he was contributing to his church. Was this a marketing exchange?
    a. no, because the church is non-profit organization.
    b. yes, because the church ran an advertisement.
    c. yes, because reading at the service was exchanged for a feeling of satisfaction.
    d. no, because no money was exchanged.
    e. no, because the church did not provide Jack with a product.

    Answer: c Page: 10
    Rationale: Marketers seek to discover and satisfy the needs and wants of customers. The key to
    achieving these objectives is exchange—the trade of things of value between buyer and seller so
    that each benefits from the exchange. In this instance, Jack is the customer and the church is the
    marketer. An exchange occurs: Jack exchanges his reading at the service for a feeling of
    satisfaction; the church receives a person to read at the service and continues its weekly
    services.




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1-20 THE MARKETING DEPARTMENT                                                          DEFINITION

    The _____ department of an organization is responsible for facilitating relationships,
    partnerships, and alliances with the organization's customers, its shareholders, its suppliers, and
    other organizations.
    a. purchasing
    b. marketing
    c. human resources
    d. accounting
    e. advertising

    Answer: b Page: 10
    Rationale: See Figure 1-3 for an illustration of this idea.

1-21 MARKETING DEPARTMENT                                                            CONCEPTUAL

    Which of the following statements about marketing departments is true?
    a. It is the responsibility of the marketing department to facilitate relationships with the
       organization's customers.
    b. It is the responsibility of the marketing department to create partnerships with the
       organization's suppliers.
    c. The marketing department must work closely with a network of other departments and
       employees to help provide the customer-satisfying products required for the organization to
       survive and prosper.
    d. The marketing department is responsible for establishing alliances with the organization's
       shareholders and other organizations.
    e. All of the above statements about marketing departments are true.

    Answer: e Page: 10
    Rationale: The marketing department of an organization is responsible for facilitating
    relationships, partnerships, and alliances with the organization's customers, its shareholders, its
    suppliers, and other organizations. See also Figure 1-3.

1-22 MARKETING ACTIVITIIES                                                           CONCEPTUAL

    Which of the following statements about marketing activities is true?
    a. Marketing is affected by society and in return affects society as a whole
    b. The marketing department works closely with other departments and employees to
       implement marketing activities.
    c. Marketing activities provide the customer-satisfying products required for the organization
       to survive and prosper.
    d. Environmental factors affect marketing activities.
    e. All of the above statements about marketing activities are true.

    Answer: e Page: 10 Other Locations: SG
    Rationale: The marketing department of an organization is responsible for facilitating
    relationships, partnerships, and alliances with the organization's customers, its shareholders, its
    suppliers, and other organizations.


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1-23 MARKETING ACTIVITIES                                                            CONCEPTUAL

    The four outside groups that exert important direct influences on an organization consist of:
    a. politicians, regulators, minority groups, and consumer monitoring groups.
    b. competitors, industry trade associations, non-profit organizations, and governmental
        agencies, such as the EPA and FTC.
    c. senior management, the legal department, the marketing department, and other employees
        of the organization.
    d. other organizations, suppliers, shareholders (owners), and customers.
    e. owners, employees, regulatory groups, and competitors.

    Answer: d Page: 10
    Rationale: See Figure 1-3 for an illustration of the relationships between an organization and
    these groups.

1-24 REQUIREMENTS FOR MARKETING TO OCCUR                                             CONCEPTUAL

    Which of the following conditions is necessary for marketing to occur?
    a. a physical location for an exchange to occur
    b. a tangible exchange
    c. advertising to express unrealized needs
    d. two or more parties with unsatisfied needs
    e. all of the above

    Answer: d Page: 11 Other Locations: W
    Rationale: For marketing to occur, at least four factors are required: (1) two or more parties
    (individuals or organizations) with unsatisfied needs, (2) a desire and ability on their part to be
    satisfied, (3) a way for the parties to communicate, and (4) something to exchange.

1-25 REQUIREMENTS FOR MARKETING TO OCCUR                                             CONCEPTUAL

    Which of the following conditions must exist in order for marketing to occur?
    a. two or more people, a method of assessing needs, a way to communicate, and an exchange
    b. two or more people, a product, a reasonable price, and a place to make an exchange
    c. two or more parties with unsatisfied needs, a desire and ability to satisfy them, a way to
       communicate, and something to exchange
    d. two or more parties with unsatisfied needs, a desire to satisfy them, a satisfactory product,
       and something to exchange
    e. a product, a price, a method of promotion, and a way to place the product with the customer

    Answer: c Page: 11
    Rationale: For marketing to occur, each of these four factors are required.




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1-26 REQUIREMENTS FOR MARKETING TO OCCUR                                             APPLICATION

    Your neighbor is tired of conventional soft drinks, and wants something different.
    Coincidentally, Cadbury Beverages, Inc., has begun distributing Country Time lemonade
    through the supermarket at a price comparable to that of soft drinks. Which of the conditions
    needed for marketing to occur is described in this situation?
    a. the creation of unrealized needs
    b. two parties with unsatisfied needs
    c. one-way communication
    d. a physical location for an exchange to take place
    e. time and place utility

    Answer: b Page: 11 Other Locations: W
    Rationale: For marketing to occur there must be (1) two or more parties (organizations or
    individuals) with unsatisfied needs, (2) a desire and an ability to satisfy them, (3) a way for the
    parties to communicate, and (4) something to exchange. In this example, the needs are: the
    consumer desires a new beverage, and Cadbury wishes to sell one.

1-27 REQUIREMENTS FOR MARKETING TO OCCUR                                             APPLICATION

    The Peabody Hotel in Orlando is setting up a clinic where visiting executives can get a
    top-to-bottom physical while attending conventions. The largest anticipated problem is the
    unwillingness for people to go to doctors that they don't know. Marketing may fail to occur here
    because:
    a. two or more parties have unsatisfied needs.
    b. there may be no desire on the part of the executive to satisfy this need.
    c. there is nothing to exchange.
    d. there is no way for the parties involved to communicate.
    e. there has been no assessment of consumers wants and needs.

    Answer: b Page: 11 Other Locations: SG
    Rationale: The executive may not have the desire to go to an unknown doctor when traveling.

1-28 REQUIREMENTS FOR MARKETING TO OCCUR                                             APPLICATION

    A student would like to buy a sports car, but she cannot afford one. Marketing does not occur in
    this situation because:
    a. two or more parties have unsatisfied needs.
    b. there is no desire on the part of either party to satisfy the other.
    c. one of the involved parties does not have the ability to satisfy the other.
    d. there is no way to communicate.
    e. there has been no assessment of consumer wants and needs.

    Answer: c Page: 11
    Rationale: The student has the desire but not the ability to participate in the marketing
    activity--which is to buy the sports car.



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1-29 REQUIREMENTS FOR MARKETING TO OCCUR                                            APPLICATION

    Suppose you are a college student taking a full course load, working 20 hours per week, and
    finding it necessary to fund a portion of your tuition and living expenses with a student loan.
    However, you see a Lexus sports coupe and desperately would like to own one. What factor(s)
    are likely to prevent you from engaging in a marketing transaction?
    a. The local Lexus dealer does not have any sports coupes in stock
    b. You do not have the resources to qualify for a $50,000 auto loan to purchase the car
    c. You do not have the time to get to the Lexus dealer because of your class, work, and study
         schedule.
    d. You can't get to the Lexus dealer easily since it is not on a bus route.
    e. All of the above are likely to prevent you from engaging in a marketing transaction.

    Answer: e Page: 11
    Rationale: For a marketing transaction to occur, both buyer and seller must have the desire and
    ability to satisfy their needs. The student must have both the time and money to purchase the
    product while the seller must have the product readily available for sale.

1-30 REQUIREMENTS FOR MARKETING TO OCCUR                                            APPLICATION

    A coalition of alcohol wholesalers and retailers and Mothers Against Drunk Driving (MADD) is
    trying to get legislation enacted to restrict Internet alcohol sales. The goal is to force on-line
    buyers to have their alcohol shipped to local liquor stores where a clerk could check customers'
    ages. If a customer has to pick his or her purchase up at a local store, it will negate the most of
    the benefits of on-line purchase. On-line wine shops such as Virtual Vineyards fear that
    marketing may fail to occur because:
    a. consumers will not have the desire or ability.
    b. consumer will not have a way to communicate.
    c. consumers will not have unsatisfied needs.
    d. consumers may rebel against the coalition.
    e. on-line shopping in general is decreasing.

    Answer: a Page: 11
    Rationale: Part of the success of shopping via the Internet is the convenience of shopping from
    home. On-line wine companies are afraid that if consumers have to go to a liquor store to pick
    up their orders, consumer would rather just purchase the alcohol at the store. Consumers may
    not have the desire to order on-line if it means an additional trip to the store.




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1-31 REQUIREMENTS FOR MARKETING TO OCCUR                                             APPLICATION

    The Hotel Westcourt in Phoenix is next to Metrocenter, a vast shopping mall. The hotel wants
    to market its location and many other amenities to convention-goers from other states. What
    requirements will be needed for marketing to occur?
    a. a way to communicate with convention attendees
    b. something to exchange
    c. two or more parties with unsatisfied needs
    d. desire and ability to satisfy unmet needs
    e. all of the above

    Answer: e Page: 11
    Rationale: For marketing to occur, you must have (1) two or more parties (organizations or
    individuals) with unsatisfied needs, (2) a desire and an ability to satisfy the needs, (3) a way for
    the parties to communicate, and (4) something to exchange. This is what Hotel Westcourt will
    try to do.

1-32 REQUIREMENTS FOR MARKETING TO OCCUR                                             APPLICATION

    An economics student would like to buy a mini-scooter, but she cannot afford one. Which of the
    following reasons explain why marketing fails to occur here?
    a. two or more parties with unsatisfied needs
    b. a desire on the part of each to satisfy the other
    c. no assessments of consumer wants and needs
    d. a way to communicate
    e. an ability on the part of each to satisfy the other

    Answer: e Page: 11
    Rationale: The student has the desire but not the ability (because she doesn't have the money) to
    participate in the marketing activity, which is to buy the mini-scooter.

1-33 CONSUMER NEEDS                                                                  CONCEPTUAL

    The text explains that the two central concerns of marketing are:
    a. market share and customer satisfaction.
    b. discovering and satisfying needs.
    c. promotion and sales.
    d. maximizing an organization's sales and products.
    e. needs and wants.

    Answer: b Page: 11
    Rationale: Marketing seeks to (1) discover the needs of prospective customers, and (2) satisfy
    those needs.




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1-34 MARKETING OBJECTIVES                                                          DEFINITION

    The first task of marketing is to:
    a. discover the needs of consumers.
    b. discover the needs of competitors.
    c. discover the needs of sellers.
    d. satisfy the needs of regulators.
    e. satisfy the needs of watchdog groups.

    Answer: a Page: 11
    Rationale: The first objective in marketing is discovering the needs of prospective consumers.
    See also Figure 1-4.

1-35 MARKETING OBJECTIVES                                                          DEFINITION

    The first task of marketing is to discover consumer:
    a. diversity.
    b. ability to pay.
    c. objectives.
    d. needs.
    e. synergy.

    Answer: d Page: 11
    Rationale: The first objective in marketing is discovering the needs of prospective consumers.
    See also Figure 1-4.

1-36 LAUNCHING SUCCESSFUL PRODUCTS                                               CONCEPTUAL

    Which of the following would be good advice for a marketer who was preparing to launch a new
    over-the-counter medication for cold sores?
    a. Give the product a lengthy name that explains all of its benefits.
    b. Give the product a mysterious name that is unrelated to its benefits to provoke curiosity.
    c. Study past product failures.
    d. Create unusual packaging that has special shelving requirements.
    e. Do all of the above.

    Answer: c Page: 12 Other Locations: SG
    Rationale: A new-product expert advices marketers who are launching new products to focus
    on what the customer benefits are and to learn from the past.




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1-37 LAUNCHING SUCCESSFUL PRODUCTS                                                 CONCEPTUAL

    When should a marketer make a careful study of product failures?
    a. when preparing to launch a new product
    b. after a new product has failed to meet sales predictions
    c. when repositioning a well-known brand
    d. when looking for a new market for an existing product
    e. in any or all of the above conditions

    Answer: a Page: 12
    Rationale: A new-product expert advices marketers who are launching new products to focus
    on what the customer benefits are and to learn from the past.

1-38 NEEDS AND WANTS                                                               CONCEPTUAL

    Which of the following statement best defines needs and wants?
    a. Needs occur when a person feels physiologically deprived of something, and wants are
       determined by a person's knowledge, culture, or personality.
    b. Wants are a subset of needs.
    c. Wants occur when a person feels physiologically deprived of something, and needs are
       determined by a person's knowledge, culture, or personality.
    d. Needs affect marketing, but wants do not.
    e. By definition, wants are more socially responsible than needs.

    Answer: a Page: 13
    Rationale: Even though not everyone's needs are the same, needs occur when a person feels
    physiologically deprived of something such as clothes, food, or shelter. A want is a felt need
    that is shaped by a person's knowledge, culture, or individual personality.

1-39 NEEDS AND WANTS                                                               APPLICATION

    A television advertisement shows several teenagers searching through the refrigerator for
    something to quench their thirst. The refrigerator offers the youngsters many alternatives—soft
    drinks, fruit drinks, sport drinks and bottles of Sunny Delight drink. The ad, which shows the
    teens happily selecting Sunny Delight over all the other product offerings, appeals to the
    consumers' _____ for liquid and attempts to shape consumers' _____ for the advertised product.
    a. wants; needs
    b. wants; preferences
    c. preferences; needs
    d. needs; wants
    e. needs; preferences

    Answer: d Page: 13 Other Locations: W
    Rationale: A need occurs when a person feels physiologically deprived of a basic necessity
    (i.e., food, water, clothing, and shelter). A want is a felt need that is shaped by a person's
    knowledge, experience, culture, or personality. A need is necessary; a want is a learned
    preference for a specific item that satisfies the consumer's need.



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1-40 NEEDS AND WANTS                                                                 APPLICATION

    Alex is three-years old and has a very limited number of foods that he will eat. His mother will
    often fill his plate with one small helping of an item that he really likes and one small helping of
    an item he doesn't like. To get more macaroni and cheese, he must eat his green beans. In
    marketing terms, the macaroni and cheese is an example of a _____ because it is something he
    has learned to like.
    a. desire
    b. need
    c. predilection
    d. preference
    e. want

    Answer: e Page: 13 Other Locations: W
    Rationale: A want is a learned preference for a specific item that satisfies the consumer's need
    (in this case, his hunger).

1-41 ETHICS AND SOCIAL RESPONSIBILITY ALERT                                          CONCEPTUAL

    Consumers make purchases by paying cash or receiving credit. Because of a financial naiveté,
    certain groups are more prone to misuse their credit than others. Which of the following groups
    has had the most difficulty in handing credit?
    a. under-25 age group
    b. over-60 age group
    c. new homeowners
    d. professionals
    e. Asian-Americans

    Answer: a Page: 14
    Rationale: In 1999, over 100,000 under-25 age people filed for bankruptcy.

1-42 DEFINITION OF MARKET                                                               DEFINITION

    The term market is best defined as:
    a. people with a need and a want for a product.
    b. organizations with the need and desire for a product.
    c. organizations with products which satisfy people's needs and wants.
    d. people with the desire and ability to buy a product.
    e. people with the desire and the need for a product.

    Answer: d Page: 14
    Rationale: Key term definition—marketing




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1-43 DEFINITION OF MARKET                                                        APPLICATION

    The market for cosmetic dentistry (which can cost $15,000 for straightening and whitening) is:
    a. children with crooked teeth.
    b. all former smokers.
    c. any adult who has the time, the money, and the desire to undergo the procedures.
    d. anyone that has ever had any plastic surgery.
    e. adults who rely on making a good first impression for job success.

    Answer: c Page: 14 Other Locations: SG
    Rationale: Potential customers make up a market, which is (1) people (2) with the desire, and
    (3) the ability to buy a specific product.

1-44 DEFINITION OF MARKET                                                          DEFINITION

    In marketing, the most common meaning of market is:
    a. a store that sells groceries.
    b. any place consumers can buy things.
    c. a particular line of products or specific line of merchandise for sale.
    d. a group of companies that have goods for sale.
    e. people with the desire and with the ability to buy a specific product.

    Answer: e Page: 14
    Rationale: Key term definition—market

1-45 DEFINITION OF MARKET                                                          DEFINITION

    All markets ultimately are composed of:
    a. people.
    b. needs.
    c. products.
    d. abilities to buy.
    e. desires.

    Answer: a Page: 14
    Rationale: Key term definition—market




                                               17
1-46 TARGET MARKET                                                               APPLICATION

    Sound and Cinema is a company that will turn an ordinary basement into a home theater. It
    advertises in publications that are mailed to homeowners in subdivisions in which the least
    expensive home costs $275,000. These homeowners are the _____ for Sound and Cinema.
    a. mass market
    b. tangent market
    c. market aggregation
    d. target market
    e. promotional market

    Answer: d Page: 14
    Rationale: A target market is a specific group of potential consumers toward which an
    organization directs its marketing program.

1-47 TARGET MARKET                                                               APPLICATION

    Television shows like Touched by an Angel and Seventh Heaven are designed to appeal to
    families that are concerned about maintaining strong moral values. This is the _____ for these
    shows.
    a. mass market
    b. tangent market
    c. market aggregation
    d. target market
    e. promotional market

    Answer: d Page: 14
    Rationale: A target market is a specific group of potential consumers toward which an
    organization directs its marketing program.

1-48 TARGET MARKET                                                                 DEFINITION

    One or more specific groups of potential consumers toward which an organization directs its
    marketing program is a:
    a. mass market.
    b. tangent market.
    c. market aggregation.
    d. target market.
    e. promotional market.

    Answer: d Page: 14
    Rationale: Key term definition—target market




                                             18
1-49 TARGET MARKET                                                                  APPLICATION

    Which of the following would be the BEST the target market for tickets to the home games of
    the Dallas Cowboys professional football team?
    a. all people in the Dallas area
    b. all people in the U.S.
    c. all men in the U.S.
    d. people in the Dallas area with an interest in professional football
    e. all people in the U.S. with an interest in professional football

    Answer: d Page: 14 Other Locations: SG
    Rationale: Only Alternative D describes people with both the desire and ability to easily attend
    games in Dallas, which is the target market toward which the Dallas Cowboys will direct its
    marketing program.

1-50 TARGET MARKET                                                                  APPLICATION

    Which of the following is the BEST description of the target market for the latest Disney
    movie?
    a. everyone who can afford to buy a movie ticket
    b. everyone who likes movies
    c. professionals who are parents of children between the ages of 3 and 12
    d. people who collect Mickey Mouse memorabilia
    e. people who live near a movie theater

    Answer: c Page: 14
    Rationale: Alternative C describes people with the ability and the desire to attend the Disney
    movie.

1-51 TARGET MARKET                                                                  CONCEPTUAL

    Which of the following groups should be the LEAST likely target market for a company
    producing canned foods in single serving sizes?
    a. single adults
    b. school kitchens
    c. campers
    d. senior citizens
    e. vending machine owners

    Answer: b Page: 13
    Rationale: Of the possible markets listed above single serving cans meet a special need for
    singles, campers, senior citizens and vending machines, the need being small, compact servings.
    School kitchens traditionally serve large quantities of food so the small size, though it could be
    used, would not satisfy a specific need.




                                               19
1-52 TARGET MARKET                                                                APPLICATION

    Which of the following groups would be the most likely target market for a company
    manufacturing briefcases?
    a. police officers
    b. teachers
    c. construction workers
    d. postal workers
    e. homemakers

    Answer: b Page: 14
    Rationale: Any of the people in the alternatives could use a briefcase. However, as a group,
    teachers would include the greatest number of people with the greatest regular need for a
    briefcase.

1-53 TARGET MARKET/MARKETING MIX                                                  APPLICATION

    A local university offers business courses for a specific target market composed of people who
    are currently working who want to take refresher courses or work toward further degrees.
    Which of the following would be the most effective way to communicate with the target market,
    bearing in mind that communication must be both effective and economical?
    a. put announcements on campus bulletin boards.
    b. distribute promotional materials during classes.
    c. advertise on national television.
    d. advertise on local top-40 radio shows.
    e. advertise in the local newspaper.

    Answer: e Page: 14
    Rationale: Alternatives A, B, and D would miss the target market. Alternative C would reach a
    lot of no-potential people and is too costly. Alternative E is the most effective and economical
    of the alternatives.

1-54 MARKETING MIX                                                                  DEFINITION

    A marketing manager's controllable factors—product, price, promotion, and place—are the
    company's:
    a. environmental factors.
    b. marketing program.
    c. marketing mix factors.
    d. marketing concept.
    e. four utilities.

    Answer: c Page: 15 Other Locations: W
    Rationale: Key term definition—marketing mix




                                              20
1-55 MARKETING MIX                                                               DEFINITION

    The four Ps are commonly known as:
    a. the environmental or uncontrollable factors.
    b. the environmental or controllable factors.
    c. the marketing mix or controllable factors.
    d. the marketing mix or uncontrollable factors.
    e. product, price, promotion, and process.

    Answer: c Page: 14 Other Locations: W
    Rationale: Key term definition—marketing mix

1-56 MARKETING MIX                                                               DEFINITION

    Which of the following would a marketer use as a synonym for controllable marketing mix
    factors?
    a. the five external environmental forces
    b. macromarketing forces
    c. the five Cs
    d. the four Ps
    e. price, product, production, and promotion

    Answer: d Page: 14
    Rationale: Key term definition—marketing mix

1-57 MARKETING MIX                                                               DEFINITION

    The four Ps of the marketing mix are:
    a. personnel, priorities, placement, and profits.
    b. promotion, product, personnel, and place.
    c. product, place, distribution, and advertising.
    d. product, promotion, price, and place.
    e. profitability, productivity, personnel, and packaging.

    Answer: d Page: 14 Other Locations: SG
    Rationale: The four Ps are the marketing manager’s controllable factors. The marketing
    actions of which can be taken to solve a marketing problem.




                                             21
1-58 MARKETING MIX                                                                APPLICATION

    Jakubowski Farms Gourmet Bread Base is the brand name for a mix designed for use in bread
    machines. The mixes are sold in 2-pound canisters for $14.99 plus postage. The products are
    only available through the mail. People learn about the product through word-of-mouth and
    through bread machine demonstrations the company's founder gives to groups in the area of
    Wisconsin where she lives. This is a description of the company's:
    a. action plan.
    b. market segmentation strategy.
    c. mission statement,
    d. marketing mix.
    e. target market.

    Answer: d Page: 14
    Rationale: The bread mix is the product. The place is through the mail. The price is $14.99
    plus postage. The promotion is word-of-mouth and public demonstrations.

1-59 MARKETING MIX                                                                APPLICATION

    The owners of Old School Brand Authentic Antique Foods researched Civil War-era cookbooks
    and to come up with recipes the old-fashioned products the company produces and markets.
    This statement deals with which part of the marketing mix?
    a. product
    b. process
    c. price
    d. place
    e. promotion

    Answer: a Page: 14
    Rationale: A product is a good, service, or idea to satisfy customer needs, so a cookie is an
    example of a product.

1-60 MARKETING MIX                                                                CONCEPTUAL

    Which element of the marketing mix is demonstrated when a company manufactures a
    low-calorie chocolate chip cookie?
    a. product
    b. price
    c. promotion
    d. place
    e. production

    Answer: a Page: 14
    Rationale: A product is a good, service, or idea to satisfy customer needs, so a cookie is an
    example of a product.




                                              22
1-61 MARKETING MIX                                                                APPLICATION

    The owners of Old School Brand Authentic Antique Foods researched Civil War-era cookbooks
    and to come up with recipes the old-fashioned products they market. Concern about the _____
    element of the marketing mix would make them eager to be featured in an upcoming edition of
    Taste of Home magazine.
    a. product
    b. price
    c. promotion
    d. place
    e. production

    Answer: c Page: 14
    Rationale: Promotion is a means of communication between the seller and buyer.

1-62 MARKETING MIX                                                                CONCEPTUAL

    The element of the marketing mix demonstrated when a company places an ad in the Yellow
    Pages is:
    a. product.
    b. price.
    c. promotion.
    d. place.
    e. process.

    Answer: c Page: 14
    Rationale: Promotion is a means of communication between the seller and buyer, such as
    Yellow Pages advertising.

1-63 MARKETING MIX                                                                APPLICATION

    The element of the marketing mix demonstrated when an art gallery suggests a $2.00 donation
    at the door is:
    a. product.
    b. price.
    c. promotion.
    d. place.
    e. production.

    Answer: b Page: 14
    Rationale: Price is what is exchanged for the product—in this case, access to an art gallery.




                                              23
1-64 MARKETING MIX                                                               APPLICATION

    To attend the winter concert presented by the community chorus, every person had to donate
    one unwrapped toy at the concert hall door. This statement is most closely related to the _____
    element of the market mix.
    a. product
    b. process
    c. price
    d. production
    e. promotion

    Answer: c Page: 14 Other Locations: SG
    Rationale: Price is what is exchanged for the product—in this case, access to the concert. The
    toy donation was exchanged for the privilege of listening to the music.

1-65 MARKETING MIX                                                               CONCEPTUAL

    The element of the marketing mix demonstrated when a newspaper carrier throws a paper on the
    front porch is:
    a. product.
    b. price.
    c. promotion.
    d. place.
    e. process.

    Answer: d Page: 14
    Rationale: Place refers to the means of getting the product into the consumer's hands (or
    bushes).

1-66 MARKETING MIX                                                               APPLICATION

    The ability to buy a soda from a vending machine demonstrates which element of the marketing
    mix?
    a. product
    b. price
    c. promotion
    d. place
    e. process

    Answer: d Page: 14
    Rationale: Place refers to the means of getting the product into the consumer's hands.




                                              24
1-67 ENVIRONMENTAL FACTORS                                                          DEFINITION

    Forces that are largely beyond the control of the marketing department and its organization are
    called:
    a. the four Ps.
    b. the marketing mix.
    c. controllable factors.
    d. environmental factors.
    e. utilities.

    Answer: d Page: 15
    Rationale: The environmental factors in a marketing decision are the uncontrollable factors
    involving social, economic, technological, competitive, and regulatory forces.

1-68 ENVIRONMENTAL FACTORS                                                          DEFINITION

    The five major environmental factors in marketing are:
    a. air, water, soil, mineral, and gas.
    b. consumer, retailer, manufacturer, organization, and society as a whole.
    c. product, price, promotion, place, and process.
    d. social, technological, economic, competitive, and regulatory.
    e. natural resources, weather, social awareness, economic factors, and regulation.

    Answer: d Page: 15
    Rationale: Key term definition—environmental factors

1-69 ENVIRONMENTAL FACTORS                                                       CONCEPTUAL

    Which of the following statements about environmental factors is true?
    a. Environmental factors may restrict an organization's opportunities.
    b. Environmental factors may enhance an organization's opportunities.
    c. Environmental factors are also called uncontrollable factors.
    d. Environmental factors include social, economic, technological, competitive, and regulatory
       forces.
    e. All of the above statements about environmental factors are true.

    Answer: e Page: 15-16 Other Locations: W
    Rationale: The five forces may serve as accelerators or brakes on marketing, sometimes
    expanding an organization’s marketing opportunities and other times, restricting them.




                                              25
1-70 ENVIRONMENTAL FACTORS                                                          APPLICATION

    Which of the following statements describes an environmental factor?
    a. Tupperware has more than 200,000 independent contractor dealers who market its entire
       product line.
    b. A car battery comes with a lifetime guarantee.
    c. An automobile offers a $500.00 rebate.
    d. Several states have legislation requiring children under four to use car seats.
    e. A major bottler offers a 10-cent refund on returnable bottles.

    Answer: d Page: 15-16 Other Locations: W
    Rationale: Alternative D describes a regulatory environmental factor. It would have a positive
    effect for manufacturers of car seats. It might have negative (costly) effect for day care centers
    providing transportation since they would have to purchase car seats for all children in their care
    under the age of four.

1-71 UNCONTROLLABLE OR ENVIRONMENTAL FACTORS                                        APPLICATION

    Which of the following environmental factor(s) could have caused Toyota to decide to build a
    manufacturing plant in the United States instead of continuing to export their cars from Japan?
    a. a growing trend in the United States to "Buy American"
    b. the success of Honda in manufacturing Accords in Ohio
    c. a decline in the value of the U.S. dollar relative to the Japanese yen
    d. increased pressure from U.S. auto makers on Washington for more restrictive quotas on
       Japanese car imports
    e. all of the above

    Answer: e Page: 15-16
    Rationale: The identified factors represent social, competitive, economic, and regulatory
    uncontrollable or environmental factors that are not controllable by Toyota but could influence
    its decision to build a plant in the United States.

1-72 UNCONTROLLABLE OR ENVIRONMENTAL FACTORS                                        APPLICATION

    Congressional legislation restricting Internet alcohol sales would affect on-line sellers such as
    Virtual Vineyards. For Virtual Vineyards, this legislation would be and example of a(n) _____
    factor.
    a. environmental
    b. promotional
    c. process
    d. price
    e. technological

    Answer: a Page: 15-16
    Rationale: Government regulation is generally considered to be one of the uncontrollable or
    environmental factors that include social, technological, economic, competitive, and regulatory
    forces.


                                               26
1-73 ENVIRONMENTAL FACTORS                                                         APPLICATION

    After years of resistance, the People's Republic of China finally allowed Coca-Cola to import
    soft drinks into the country. The import restriction was an example of what is called in
    marketing an uncontrollable, or ______ factor because it relates to forces outside the marketing
    company.
    a. environmental
    b. technological
    c. epistemological
    d. heuristic
    e. synergistic

    Answer: a Page: 15-16 Other Locations: SG
    Rationale: Government regulation is generally considered to be one of the uncontrollable or
    environmental factors that include social, technological, economic, competitive, and regulatory
    forces.

1-74 RELATIONSHIP MARKETING                                                        APPLICATION

    In the nonprofit world of the performing arts, box office technology has essentially remained the
    same since the 1980s. A company named Intellitex is trying to change that. Intellitex is able to
    track every transaction with patrons on one database—from tickets and fund-raising to
    volunteering and gift shop purchases. This technology will allow arts groups to develop
    detailed customer profiles, which helps symphonies, operas, and theaters tailor their sales
    pitches to individuals. In other words, Intellitex is going to allow arts groups to engage in:
    a. market aggregation.
    b. relationship marketing.
    c. industry reciprocity.
    d. customer aesthetics.
    e. none of the above.

    Answer: b Page: 16
    Rationale: Relationship marketing will link the organization to its individual customers,
    employees, suppliers and other partners for their mutual long-term benefit..

1-75 CUSTOMER VALUE                                                                  DEFINITION

    The unique combination of benefits received by targeted buyers that include quality, price,
    convenience, on-time delivery, and both before-sale and after-sale service is called:
    a. target marketing.
    b. benefit segmentation.
    c. customer value.
    d. customer satisfaction.
    e. product dissonance.

    Answer: c Page: 16
    Rationale: Key term definition—customer value


                                               27
1-76 CUSTOMER VALUE                                                                 CONCEPTUAL

    Customer value emphasizes:
    a. convenience.
    b. price.
    c. quality.
    d. service (before-sale and after-sale).
    e. all of the above.

    Answer: e Page: 16
    Rationale: Customer value is the unique combination of benefits received by targeted buyers
    that include quality, price, convenience, on-time delivery, and both before-sale and after-sale
    service.

1-77 RELATIONSHIP MARKETING                                                            DEFINITION

    _____ links the organization to its individual customers, employees, suppliers and other
    partners for their mutual long-term benefit.
    a. A marketing chain
    b. Holistic marketing
    c. Synergistic marketing
    d. Relationship marketing
    e. Tactical marketing

    Answer: d Page: 16
    Rationale: Key term definition—relationship marketing

1-78 CUSTOMER VALUE                                                                 APPLICATION

    If you ever talk to anyone who has flown on Singapore Air, you will no doubt hear that
    individual praise the food that was served during the flight, the friendliness of the air stewards,
    and the comfortable surroundings. From this description, you can surmise Singapore Air
    creates customer value by providing its customers with:
    a. the best service.
    b. the most convenient flight schedules.
    c. the best price.
    d. the best employees.
    e. all of the above

    Answer: a Page: 16 Other Locations: SG
    Rationale: Outstanding customer value is delivered through the implementation of one of three
    value strategies—best price, best value, or best service. Note that this question does not
    consider price or flight schedules.




                                                28
1-79 RELATIONSHIP MARKETING                                                        APPLICATION

    Manugistics and i2 Technologies, two top vendors of supply chain management software, have
    recently launched their own on-line trading exchange aimed at creating a supply chain for their
    customers to make distribution of products and ideas easier for all involved. These two
    organizations hope to benefit from:
    a. relationship marketing.
    b. entropy.
    c. the 80/20 principle.
    d. customer valuation.
    e. a marketing chain

    Answer: a Page: 16
    Rationale: Relationship marketing links the organization to its individual customers, employee,
    suppliers and other partners for their mutual long-term benefit.

1-80 RELATIONSHIP MARKETING                                                        APPLICATION

    A business traveler joined the Starwood Preferred Guest Program in order to earn points each
    time he stayed overnight in a Westin or Sheraton hotel. Once he has accumulated enough
    points, he can trade his points in for a free night's stay. As a member of this program, the
    traveler receives periodic updates on new hotels and learns of ways to earn additional points.
    This is an example of:
    a. relationship marketing.
    b. entropy.
    c. the 80/20 principle.
    d. customer valuation.
    e. a marketing chain

    Answer: a Page: 16-17
    Rationale: Relationship marketing links the organization to its individual customers, employee,
    suppliers and other partners for their mutual long-term benefit.

1-81 RELATIONSHIP MARKETING                                                        CONCEPTUAL

    Which of the following statements about relationship marketing is true?
    a. Relationship marketing has a short-term focus on increasing profits.
    b. Relationship marketing is easy to implement.
    c. In an ideal setting, relationship marketing is a personal, ongoing relationship.
    d. Very few companies today are engaged in relationship marketing.
    e. The Internet is an ideal forum for relationship marketing.

    Answer: c Page: 16-17
    Rationale: One of the characteristics of relationship marketing is its long-term focus.
    Relationship marketing is difficult to implement. Many companies use relationship marketing.
    It is difficult to engage in relationship marketing on the Internet because it lacks the personal
    touch.


                                               29
1-82 RELATIONSHIP MARKETING                                                        APPLICATION

    Which of the following businesses is LEAST likely to be able to engage in relationship
    marketing?
    a. a beach shop that sells tourist mementos
    b. a local restaurant that specializes in home-cooking
    c. a convenience store
    d. a movie theater
    e. a veterinarian

    Answer: a Page: 17 Other Locations: W
    Rationale: Alternatives B, C, D, and E describe businesses that can count on multiple visits
    from its customers. It is unlikely that a tourist would make more than one or two visits to a shop
    selling items for the tourist market.

1-83 RELATIONSHIP MARKETING                                                        CONCEPTUAL

    Which of the following acts as a barrier to the development of relationship marketing?
    a. the large number of one-to-one relationships customers are asked to sustain
    b. the large number of products on the market
    c. the increasing number of retail stores that are closing
    d. changing regulatory environments
    e. diluted cultural diversity

    Answer: a Page: 17 Other Locations: W
    Rationale: Researchers observed that the number of one-on-one relationships that companies
    ask consumers to maintain is untenable.

1-84 RELATIONSHIP MARKETING                                                        CONCEPTUAL

    Which of the following acts as a barrier to the development of relationship marketing?
    a. changes in the demographic nature of society
    b. the ever-increasing usage of the Internet for consumer purchases
    c. the onset of new cultural traditions
    d. a population with a median age of 50
    e. recent terrorists' activities

    Answer: b Page: 17
    Rationale: With today’s Internet purchases, you will probably have difficulty achieving the
    same personal, tender-loving–care connection that you once had with your own special book or
    music store.




                                               30
1-85 MARKETING PROGRAM                                                              DEFINITION

   A _____ is a plan that integrates the elements of the marketing mix to provide goods, services,
   or ideas to the consumer.
   a. marketing strategy
   b. marketing program
   c. macromarketing program
   d. micromarketing program
   e. sales promotion

   Answer: b Page: 17 Other Locations: SG
   Rationale: Key term definition—marketing program

1-86 MARKETING PROGRAM                                                          CONCEPTUAL

   After an assessment of needs, a marketing manager must translate ideas from consumers into
   concepts for products that a firm may develop. The result is called the:
   a. marketing strategy.
   b. marketing program.
   c. macromarketing program.
   d. micromarketing program.
   e. marketing concept.

   Answer: b Page: 17
   Rationale: Ideas must be converted into a tangible marketing program—a plan that integrates
   the marketing mix to provide goods, services, or ideas to potential consumers who are the
   market.

1-87 MARKETING PROGRAM                                                              DEFINITION

   After discovering consumers' needs, marketing's next task is to:
   a. create a target market mission statement.
   b. determine consumer demographics.
   c. translate information about consumer needs into products that satisfy them.
   d. design product prototypes.
   e. develop a value strategy.

   Answer: c Page: 16
   Rationale: A marketing program is defined as a plan that integrates the marketing mix to
   provide a good, service, or idea to prospective buyers.




                                             31
1-88 ROLLERBLADE, INC., MARKETING PROGRAM                                            APPLICATION

    Rollerblade developed the Junior line of skates that can be modified to fit a child's foot as it
    grows. The _____ for this product line is children.
    a. market aggregation
    b. mass market
    c. marketing program
    d. marketing mix
    e. target market

    Answer: e Page: 18
    Rationale: A target market is a specific group of potential consumers toward which an
    organization directs its marketing program.

1-89 ROLLERBLADE, INC., MARKETING PROGRAM/MAR                                        APPLICATION

    Rollerblade's decision to feature its in-line skates in sports competition and magazines like
    Shape and Mademoiselle is most closely related to which element of the marketing mix?
    a. process
    b. promotion
    c. price
    d. place
    e. product

    Answer: b Page: 19
    Rationale: Promotion is a means of communication between the seller and buyer. See also
    Figure 1-6.

1-90 ROLLERBLADE, INC., MARKETING PROGRAM/MAR                                        APPLICATION

    When Rollerblade's marketing department designs a strategy to make it easy for in-line skate
    buyers to buy them at a retail outlet that is convenient to them and where they feel comfortable
    shopping, it is concerned with the _____ element of the marketing mix.
    a. process
    b. promotion
    c. price
    d. place
    e. product

    Answer: d Page: 19
    Rationale: Place refers to the means of getting the product into the consumer's hands. See also
    Figure 1-6.




                                                32
1-91 ERAS OF U.S. BUSINESS HISTORY                                                APPLICATION

    If you wanted a new pair of shoes during the Civil War, you traced the outline of your foot on a
    piece of paper and gave it to a shoemaker. There was no distinction between right and left foot
    because you wanted your shoes as quickly as possible and the shoemaker knew that you would
    buy them even if they just sort of fit. This is an example of a transaction that would have
    occurred during the _____ era in U.S. business history.
    a. production
    b. sales
    c. marketing concept
    d. societal marketing concept
    e. market orientation

    Answer: a Page: 20
    Rationale: The major concern of the shoemaker was production.

1-92 ERAS OF U.S. BUSINESS HISTORY                                                APPLICATION

    During the _____ era in U.S. business history, the primary function of the Pillsbury Company
    was to mill quality flour.
    a. production
    b. sales
    c. marketing concept
    d. societal marketing concept
    e. market orientation

    Answer: a Page: 20-21 Other Locations: SG
    Rationale: Robert Keith, a Pillsbury president, described his company at this stage: "We are
    professional flour millers. Blessed with a supply of the finest North American wheat, plenty of
    water power, and excellent milling machinery, we produce flour of the highest quality. Our
    basic function is to mill quality flour." This sort of thinking typified the production era.

1-93 ERAS OF U.S. BUSINESS HISTORY                                                  DEFINITION

    Although it was thought in the 19th century that production creates its own demand, American
    companies began to produce more goods than their regular buyers could consume. At the same
    time, competition became more significant, and the problems of reaching the market became
    more complex. It was for these reasons the _____ era began.
    a. product
    b. production
    c. sales
    d. marketing concept
    e. market orientation

    Answer: c Page: 21
    Rationale: During the sales era firms hired more salespeople to find new buyers as a solution to
    this problem.


                                              33
1-94 ERAS OF U.S. BUSINESS HISTORY                                               APPLICATION

    Shortly after World War II, Sam Jackson developed an idea for a biodegradable lubricant that
    was superior to anything currently on the market. He was excited about his new idea, and he has
    persuaded a number of his friends to help produce samples. He hired a salesforce to sell the
    device to manufacturing companies in the area. This is a good example of behavior one would
    expect in the _____ era of U.S. business history.
    a. marketing concept
    b. market orientation
    c. production
    d. sales
    e. societal marketing concept

    Answer: d Page: 21
    Rationale: Those businesses in the sales era are concerned mainly with selling products that
    their company designs—without a serious attempt to understand the wants and needs of people
    in the target market.

1-95 ERAS OF U.S. BUSINESS HISTORY                                               CONCEPTUAL

    Which of the following statements is the primary reason that explains why U.S. businesses
    moved from the production era to the sales era?
    a. The population was moving away from urban areas.
    b. There were too many customers to serve.
    c. Competition grew as the production of goods increased and reaching markets became more
       difficult.
    d. Advertising was becoming a major marketing force.
    e. Technology was in a dormant stage.

    Answer: c Page: 21
    Rationale: Production techniques improved, and capacity increased. Firms began producing
    more goods than their regular customers could consume. Competition increased and the thrust
    was to find new customers and markets to consume surplus goods.




                                              34
1-96 ERAS OF U.S. BUSINESS HISTORY                                                 APPLICATION

    Imagine a confectionary company has introduced a new nutty candy bar during the 1930s (the
    sales era in U.S. business history). How would you expect the company to react if sales of this
    new candy bar were much lower than expected?
    a. We'd better do some market testing to determine why people are dissatisfied.
    b. Perhaps, we should make candy bars with raisins.
    c. Let's put more aggressive salespeople in the field.
    d. Let's forget the whole thing.
    e. Don't worry about it; we're the largest candy manufacturer in the area. Sooner or later
         they'll get hungry enough that they'll come to us.

    Answer: c Page: 21
    Rationale: The central notion of the sales era was that the quality and production of the product
    was fine. If sales were down, it was the result of a saturated market and all that had to be done
    was to find a new group of customers or a new market without altering the product itself—a task
    assigned to the sales force.

1-97 ERAS OF U.S. BUSINESS HISTORY                                                   DEFINITION

    The period of American business history when firms could produce more than they could sell
    and the focus was on hiring more salespeople to seek out new markets and customers was the
    _____ era.
    a. marketing concept
    b. production
    c. sales
    d. societal marketing concept
    e. consumerism

    Answer: c Page: 21 Other Locations: W
    Rationale: Also see Figure 1-7.

1-98 MARKETING CONCEPTUAL                                                            DEFINITION

    The _____ is the idea that an organization should seek to satisfy the wants of customers while
    also trying to achieve the organization's goals.
    a. concept of synergy
    b. marketing concept
    c. principle of consumerism
    d. societal marketing concept
    e. selling concept

    Answer: b Page: 20 Other Locations: W
    Rationale: Key term definition—marketing concept




                                               35
1-99   MARKETING CONCEPTUAL                                                            APPLICATION

       In the 1960s, Pillsbury defined its mission as, "We are in the business of satisfying needs and
       wants of customers." This is a brief statement of what has come to be known as the:
       a. hard-sell strategy.
       b. soft-sell strategy.
       c. selling concept.
       d. marketing concept.
       e. marketing mix.

       Answer: d Page: 21 Other Locations: SG
       Rationale: Pillsbury is a prime example of a company that adopted the marketing concept since
       it was among the first to realize the value of the idea.

1-100 MARKETING CONCEPTUAL                                                             APPLICATION

       Many who attend circuses particularly look forward to the performances that use lions, tigers,
       elephants monkeys, and other animals and get a great deal of pleasure from watching these acts.
       There are also a lot of people who enjoy the other circus acts but feel strongly that these animals
       are being abused because they are forced to perform. This example indicates it is not always
       easy to act in accordance with the:
       a. marketing concept.
       b. marketing mix.
       c. organizational strategy.
       d. sales quota.
       e. market aggregation strategy.

       Answer: a Page: 22
       Rationale: The marketing concept is the idea that an organization should seek to satisfy the
       wants of customers while also trying to achieve the organization's goals.

1-101 ERAS OF U.S. BUSINESS HISTORY                                                    CONCEPTUAL

       Which of the following statements about the marketing concept era is true?
       a. During the marketing concept era, companies tried to satisfy the needs of consumers while
          also achieving the organization's goals.
       b. During the marketing concept era, companies tried to satisfy the wants of the consumer no
          matter what.
       c. During the marketing concept era, companies believed if you produced as much as you can,
          at the highest quality level, for the lowest price, the product will sell itself.
       d. All U.S. firms are now operating with a marketing concept era philosophy.
       e. The marketing concept era can actually trace its roots to early Greek culture.

       Answer: a Page: 21
       Rationale: The marketing concept era is the present period of American business history for
       many firms. It is consumer oriented so organizations strive to produce products that meet
       consumer needs while achieving organizational objectives. Neither the ancient Greek
       philosophers nor their city-states alluded to the marketing concept as we know it today.


                                                  36
1-102 ERAS OF U.S. BUSINESS HISTORY                                              CONCEPTUAL

     What term best describes the marketing concept era?
     a. production oriented
     b. sales oriented
     c. society oriented
     d. consumer oriented
     e. competition oriented

     Answer: d Page: 21
     Rationale: The marketing concept era consumer oriented so firms try to produce products that
     meet consumer needs while also trying to achieve organizational goals.

1-103 ERAS OF U.S. BUSINESS HISTORY                                                DEFINITION

     The American business period that attempts to satisfy consumer needs while achieving
     organizational goals is called the _____ era.
     a. sales
     b. production
     c. marketing concept
     d. societal marketing concept
     e. consumerism

     Answer: c Page: 20
     Rationale: In the 1960s, marketing became the motivating force among many American firms.
     The policy of those seeking to satisfy the needs and wants of customers has come to be known
     as the marketing concept.

1-104 ERAS OF U.S. BUSINESS HISTORY                                                DEFINITION

     Which era of U.S. business history does the following statement best describe? “We are in the
     business of satisfying needs and wants of consumers.”
     a. the production era
     b. the sales era
     c. the marketing concept era
     d. the marketing orientation era
     e. the societal marketing era

     Answer: c Page: 21
     Rationale: In the 1960s, marketing became the motivating force among many American firms.




                                              37
1-105 ERAS OF U.S. BUSINESS HISTORY                                                  APPLICATION

     In the _____ era of U.S. business history, supply exceeded demand, products could be
     differentiated from each other; and producers have determined different consumer wants and
     needs.
     a. production
     b. sales
     c. marketing concept
     d. industrial revolution
     e. micromarketing

     Answer: c Page: 21
     Rationale: Producers have sought to discover consumer wants and needs—a characteristic that
     distinguishes the marketing concept era from the earlier production and sales eras.

1-106 ERAS OF U.S. BUSINESS HISTORY                                                     DEFINITION

     The goal of the _____ era is to integrate marketing into all phases of the business process.
     a. production
     b. sales
     c. marketing concept
     d. industrial revolution
     e. micromarketing

     Answer: c Page: 21 Other Locations: SG
     Rationale: At this time the idea that marketing ideas are fed into the production cycle from after
     an item is produced to before it is designed helped illustrate that marketing concept is a focus on
     the consumer.

1-107 ERAS OF U.S. BUSINESS HISTORY                                                  CONCEPTUAL

     Beginning in the 1960s, many companies endorsed the marketing concept and defined the
     purpose of their business as the creation and retention of satisfied customers. Implementation of
     the concept:
     a. occurred as a natural outgrowth of that definition of purpose.
     b. followed quickly as employees adjusted rapidly to the new orientation.
     c. took roughly 3 to 5 years to complete.
     d. proved to be very difficult.
     e. has not yet been achieved.

     Answer: d Page: 21
     Rationale: Clearly the marketing concept is a focus on the consumer. Unfortunately, many
     companies found that actually implementing the concept was very difficult.




                                                38
1-108 ERAS OF U.S. BUSINESS HISTORY                                                APPLICATION

     In the movie, The Tin Men, two rival salesmen engaged in a variety of dishonest and unethical
     practices in order to sell aluminum siding to homeowners. Their job was difficult, in part,
     because the supply of aluminum siding surpassed the demand for the product and competition
     was intense. This situation is indicative of the _____ era of U.S. business history.
     a. production.
     b. sales
     c. marketing concept
     d. market orientation
     e. societal marketing

     Answer: b Page: 20
     Rationale: During the sales era, marketing organizations concentrated on selling the products
     they could most readily produce rather than on developing products designed to satisfy the
     needs of customers.

1-109 MARKET ORIENTATION                                                             DEFINITION

     An organization that focuses its efforts on continuously collecting information about customers'
     needs and competitors' capabilities, sharing this information across departments, and using the
     information to create customer values is said to:
     a. stress the societal marketing concept.
     b. have a focus on macromarketing.
     c. have a nonprofit orientation.
     d. have a market orientation.
     e. be utilizing consumerism.

     Answer: d Page: 21
     Rationale: Firms have achieved great success by putting huge effort into implementing the
     marketing concept, giving their firms what has been called market orientation.

1-110 MARKET ORIENTATION                                                             DEFINITION

     A market orientation towards consumers and competitors requires:
     a. the development of multiple target markets and marketing mixes.
     b. a firm to engage in industrial espionage.
     c. involvement of managers and employees throughout the firm.
     d. considerable corporate downsizing.
     e. the gathering of clandestine competitive intelligence.

     Answer: c Page: 21
     Rationale: Market orientation focuses its efforts on (1) continuously collecting information
     about customers’ needs and competitors’ capabilities, (2) sharing this information across
     departments, and (3) using the information to create customer value.




                                               39
1-111 MARKET ORIENTATION                                                            DEFINITION

     Firms with a demonstrated market orientation _____ than those lacking it.
     a. are considered more charitable
     b. are more profitable
     c. are more disliked by their competitors
     d. are more often written up in the business press
     e. have fewer problems with government regulatory agencies

     Answer: b Page: 21
     Rationale: Firms have achieved great success by putting huge effort into implementing the
     marketing concept, giving their firms what has been called market orientation.

1-112 ETHICS AND SOCIAL RESPONSIBILITY                                              DEFINITION

     As organizations have changed their orientation, society's expectations of marketers have also
     changed. Today, the emphasis of marketing practice has shifted from _____ to consumers'
     interests.
     a. social responsibilities
     b. government regulation
     c. producers' interests
     d. suppliers' interests
     e. competitive activity

     Answer: c Page: 22 Other Locations: W
     Rationale: Organizations are increasingly encouraged to consider the social and environmental
     consequences of their actions.

1-113 CUSTOMER RELATIONSHIP MANAGEMENT                                              DEFINITION

     _____ is the process of identifying prospective buyers, understanding them intimately, and
     developing favorable long-term perceptions of the organization and its offerings so buyers will
     choose that company and its products in the marketplace.
     a. A flexible marketing system
     b. A database warehouse
     c. Customer relationship management
     d. Competitive intelligence
     e. A customer-oriented marketing mix

     Answer: c Page: 21 Other Locations: W
     Rationale: Key term definition—customer relationship management (CRM)




                                               40
1-114 CUSTOMER RELATIONSHIP MANAGEMENT                                            APPLICATION

    Every day, buyers from large utility companies and sellers from energy companies visit an
    online exchange dealing in wholesale electricity and gas to negotiate prices for the energy that
    heats and lights many homes and businesses. The exchange knows there are competitors vying
    for its customers so it relies heavily on technology to build and retain strong, one-on-one
    relationships with each customer. The exchange uses _____ to know its customer and to win
    their allegiance.
    a. a flexible marketing system
    b. a database warehouse
    c. customer relationship management
    d. competitive intelligence
    e. a customer-oriented marketing mix

    Answer: c Page: 21 Other Locations: SG
    Rationale: Customer relationship management is the process of identifying prospective buyers,
    understanding them intimately, and developing favorable long-term perceptions of the
    organization and its offerings so buyers will choose it in the marketplace.

1-115 CUSTOMER RELATIONSHIP MANAGEMENT                                            APPLICATION

    United Way of Greater Toronto (UWGT), like many charities, is sitting on a gold mine of donor
    data. Locked up in its computer and paper files are records of millions of companies, groups,
    and individuals that have donated in past years. Also like most philanthropic organizations,
    UWGT was having a rough time using that information efficiently. It could blanket past donors
    with generic mailings, but it could not offer its donors anything that would makes person donate
    to it instead of other charities. Which of the following tools would be most useful for the
    nonprofit organization to use?
    a. a flexible marketing system
    b. a database warehouse
    c. customer relationship management
    d. competitive intelligence
    e. a customer-oriented marketing mix

    Answer: c Page: 21
    Rationale: Students may have some difficulty with this question because it has to do with a
    nonprofit, but they should realize that donors are a type of customer.




                                              41
1-116 CUSTOMER RELATIONSHIP MANAGEMENT                                               CONCEPTUAL

     Customer relationship management (CRM) is most closely related to the _____ era in U.S.
     business history.
     a. production.
     b. sales
     c. marketing concept
     d. nonprofit orientation
     e. societal marketing

     Answer: c Page: 21
     Rationale: Both marketing concept and CRM strive to satisfy consumer needs while achieving
     their organization’s goals.

1-117 ETHICS                                                                            DEFINITION

     What are the moral principles and values that govern the actions and decisions of an individual
     or group called?
     a. societal marketing concepts
     b. social responsibilities
     c. modes of behavior
     d. legal codes
     e. ethics

     Answer: e Page: 22
     Rationale: The scope of ethics is broader than societal marketing concepts, and narrower than
     habits, modes of behavior, or social responsibility, where the latter relates to society as a whole
     and not to the decisions made by individual firms or people.

1-118 ETHICS                                                                         APPLICATION

     Which of the following activities is the LEAST objectionable from the standpoint of ethics?
     a. producing children's toys from a material that causes rashes among many people
     b. supplying a product that satisfies a natural urge but ultimately becomes an addiction
     c. producing and selling a product that some medical experts believe has dangerous long run
        health risks
     d. running ads that point out the weaknesses of competitive products
     e. supplying a product that meets a natural need and encourages antisocial behavior, and
        perhaps even violence

     Answer: d Page: 22
     Rationale: Alternative D is the only answer that is not a threat to physical or social well-being;
     in fact, it increases available information and should help consumers make more knowledgeable
     decisions. So only choice d meets the sense of ethics—the moral principles and values that
     govern the actions and decisions of an entire group.




                                                42
1-119 SOCIAL RESPONSIBILITY                                                             DEFINITION

     Social responsibility is:
     a. the moral principles and values that govern the actions and decisions of an entire group.
     b. the idea that organizations are a part of a larger society and are accountable to society for
         their actions.
     c. actively trying to understand customer needs and satisfying them as well as the firm's goals.
     d. seeking greater influence about the quality of products and the amount of information
         received from sellers.
     e. the view that an organization should discover and satisfy the needs of its consumers in a
         way that also provides for society's well-being.

     Answer: b Page: 22
     Rationale: While many ethical issues involve only the buyer and seller, others involve society
     as a whole. Social responsibility is the idea that organizations are accountable to a larger
     society.

1-120 SOCIAL RESPONSIBILITY                                                          APPLICATION

     Which of the following most directly explains why pharmaceutical giant Pfizer offered
     low-income senior citizens many of its most widely used prescriptions for $15 each a month?
     a. the profit motive
     b. the social responsibility concept
     c. its internal environment
     d. its regulatory environment
     e. corporate downsizing

     Answer: b Page: 22
     Rationale: Social responsibility is the idea that organizations are a part of a larger society and
     are accountable to society for their actions.

1-121 SOCIAL RESPONSIBILITY                                                          APPLICATION

     When Eastman Kodak Company concerns itself with disposal of its film packages in national
     parks by promoting the slogan "Take only pictures, leave only footprints," it is acting in
     accordance with:
     a. the profit motive.
     b. the social responsibility concept.
     c. its internal environment.
     d. its regulatory environment.
     e. corporate downsizing.

     Answer: b Page: 22
     Rationale: This example is similar to the one given in the text about disposal of batteries for a
     portable CD player.




                                                43
1-122 SOCIAL RESPONSIBILITY                                                          APPLICATION

     In the past, Burger King, Wendy's, and McDonald's used to market their burgers in
     non-biodegradable Styrofoam containers. In response to calls from the public to use more
     environmentally-friendly materials, most fast food marketers use paper containers for their
     burgers. Indeed, many such containers are made from recycled materials. This is an example of:
     a. macromarketing by the fast food chains.
     b. socially responsible marketing.
     c. reverse marketing.
     d. consumer advocacy.
     e. repositioning by the fast food chains.

     Answer: b Page: 22 Other Locations: SG
     Rationale: Marketing organizations exist in a larger society. As such, the marketing
     organization's activities and decisions should take into consideration the well-being of society at
     large. This means that socially responsible marketers seek to satisfy the needs of both the
     customer and the organization and the needs of society as well.

1-123 SOCIAL RESPONSIBILITY                                                             DEFINITION

     3M innovators developed Scotchbrite Never Rust Wool Soap Pads from recycled plastic bottles.
     These soap pads are more expensive than competitors (S.O.S. and Brillo) but also superior to
     them because Scotchbrite Never Rust Wool Soap Pads don't rust or scratch. This solution:
     a. is environmentally friendly, socially responsible, and competitive.
     b. offsets the cost of improving environmental impact.
     c. increases consumer value.
     d. is ethical and socially responsible.
     e. is accurately described by all of the above.

     Answer: e Page: 22
     Rationale: With its innovative product 3M both offsets the costs of recycling and increases
     consumer value. Thus, consumers have been willing to pay a premium.




                                                44
1-124 SOCIAL RESPONSIBILITY                                                        CONCEPTUAL

     Many environmentally friendly products have been costly to produce, and consumers have not
     been willing to pay a premium for them. As a result, companies often question if they can be
     both _____ and competitive.
     a. technologically advanced
     b. fiscally responsible
     c. socially responsible
     d. compliant with demand
     e. customer friendly

     Answer: c Page: 22
     Rationale: Social responsibility is the idea that organizations are accountable to a larger
     society. The well-being of society at large should also be recognized in an organization’s
     marketing decisions.

1-125 SOCIETAL MARKETING CONCEPTUAL                                                   DEFINITION

     The societal marketing concept is:
     a. the moral principles and values that govern the actions and decisions of an entire group.
     b. the idea that organizations are a part of a larger society and are accountable to society for
         their actions.
     c. actively trying to understand customer needs and satisfying them as well as the firm's goals.
     d. seeking greater influence about the quality of products and the amount of information
         received from sellers.
     e. the view that an organization should discover and satisfy the needs of its consumers in a
         way that also provides for society's well-being.

     Answer: e Page: 22
     Rationale: Key term definition—societal marketing concept

1-126 SOCIETAL MARKETING CONCEPTUAL                                                   DEFINITION

     The view, which holds that an organization should assess and satisfy the needs of customers in a
     way that also provides for society's well being is:
     a. the societal marketing concept
     b. the marketing concept.
     c. consumerism.
     d. a sense of environmental responsibility.
     e. capitalism.

     Answer: a Page: 22
     Rationale: Key term definition—societal marketing concept




                                               45
1-127 SOCIETAL MARKETING CONCEPTUAL                                                CONCEPTUAL

    According to the societal marketing concept, who is most important in deciding what needs and
    wants are good for consumers in the long run?
    a. the organization itself
    b. the individual consumers
    c. regulatory bodies like the Federal Trade Commission
    d. marketing researchers
    e. competitive forces

    Answer: a Page: 22 Other Locations: W
    Rationale: The societal marketing concept holds that the organization itself should discover
    and satisfy the needs of its consumers while also providing for society's well being. There is an
    admitted problem with adopting this orientation; organizations voluntarily choosing actions that
    they see as good for consumers and society. Marketing researchers may suggest concerns about
    society, but they do not make the final decision about what to do.

1-128 SOCIETAL MARKETING CONCEPTUAL/MACROMARKETING                                 CONCEPTUAL

    The societal marketing concept is most closely related to:
    a. the controllable forces within an organization's environment.
    b. the sociocultural environment.
    c. micromarketing.
    d. the economic infrastructure.
    e. macromarketing.

    Answer: e Page: 22 Other Locations: W
    Rationale: The societal marketing concept is directly related to macromarketing, which looks
    at the aggregate flow of a nation’s goods and services to benefit society.

1-129 MACROMARKETING                                                                   DEFINITION

    _____ is the aggregate flow of a nation's goods and services to benefit society.
    a. Micromarketing
    b. Macromarketing
    c. Societal marketing
    d. Financial marketing
    e. Economics

    Answer: b Page: 22
    Rationale: Key term definition—macromarketing




                                               46
1-130 MACROMARKETING                                                                 DEFINITION

    The discipline that addresses broad issues such as whether marketing costs too much, whether
    advertising is wasteful, and what resource scarcities and pollution side effects result from the
    marketing system is called:
    a. micromarketing.
    b. macromarketing.
    c. societal marketing.
    d. financial marketing.
    e. the marketing concept.

    Answer: b Page: 22 Other Locations: SG
    Rationale: Key term definition—macromarketing

1-131 MICROMARKETING/MACROMARKETING                                                  DEFINITION

    Which of the following statements best distinguishes between macromarketing and
    micromarketing?
    a. Macromarketing uses a marketing program, and micromarketing does not.
    b. Macromarketing is affected by environmental factors, but micromarketing is not.
    c. Micromarketing is affected by environmental factors, but macromarketing is not.
    d. Macromarketing looks at the flow of an entire nation's goods and services, and
        micromarketing concerns itself with the marketing activities of a single firm.
    e. Micromarketing looks at the flow of an entire nation's goods and services, and
        macromarketing concerns the marketing activities of a single firm.

    Answer: d Page: 22
    Rationale: Macromarketing addresses broad issues such as whether marketing costs too much,
    while micromarketing addresses how an individual organization allocates its resources to
    benefit its customers.

1-132 MICROMARKETING                                                                 DEFINITION

    How an individual organization directs its marketing activities and allocates its resources to
    benefit its customers is known as:
    a. micromarketing.
    b. market restructuring.
    c. cultural marketing.
    d. macromarketing.
    e. megamarketing.

    Answer: a Page: 22
    Rationale: Key term definition—micromarketing




                                               47
1-133 MICROMARKETING                                                                DEFINITION

    The text concentrates on what is called _____, which relates to how an individual organization
    directs its marketing activities and allocates its resources to benefit its customers.
    a. micromarketing
    b. macromarketing
    c. marketing infrastructure
    d. marketing functionality
    e. the physicality of marketing

    Answer: a Page: 22
    Rationale: Key term definition—micromarketing

1-134 WHO MARKETS?                                                                CONCEPTUAL

    Which of the following groups would utilize marketing?
    a. professionals such as doctors or lawyers
    b. major corporations
    c. nonprofit organizations
    d. politicians
    e. all of the above

    Answer: e Page: 22-23
    Rationale: Every organization markets whether it handles goods, services, or ideas. Marketing
    implies an exchange even if the exchange is neither physical nor monetary.

1-135 WHO MARKETS?                                                                CONCEPTUAL

    What kinds of organizations engage in marketing?
    a. only those that can afford national advertising
    b. very large and established nonprofit organizations
    c. exclusively Fortune 1000 companies
    d. every organization markets
    e. virtually no organizations

    Answer: d Page: 22-23
    Rationale: Every organization markets, because in some way it is important for it to encourage
    people either to engage in exchanges with it, or perhaps just to think or behave in a particular
    way—as in the case of many non-profits such as the American Cancer Society or government
    agencies such as the U.S. Department of Transportation.




                                              48
1-136 ULTIMATE CONSUMERS                                                           DEFINITION

    The individuals who use the goods and services purchased for a household are collectively
    referred to as:
    a. organizational buyers.
    b. household buyers.
    c. ultimate consumers.
    d. nonprofessional buyers.
    e. family members.

    Answer: c Page: 23
    Rationale: Key term definition—organizational buyers

1-137 ULTIMATE CONSUMERS                                                           DEFINITION

    What is the marketing term for individuals who use goods and services purchased for a
    household—whether they are 80 years or 8 months old?
    a. situational buyers
    b. primary buyers
    c. ultimate consumers
    d. purchasing agents
    e. buying groups

    Answer: c Page: 23
    Rationale: Both individuals and organizations buy and use goods and services that are
    marketed. Ultimate consumers refer to the individuals rather than the organizations.

1-138 ULTIMATE CONSUMERS                                                        APPLICATION

    Which of the following is an example of an ultimate consumer?
    a. a woman buying a new car
    b. a preschooler eating peanut butter
    c. a retired steelworker taking a cruise
    d. a doctor buying a piano
    e. all of the above

    Answer: e Page: 24 Other Locations: SG
    Rationale: An ultimate consumer is the person who uses the goods or services purchased for the
    household. Any of the people among the answers above, regardless of age or profession, could
    use the products or services listed.




                                             49
1-139 ULTIMATE CONSUMERS                                                         APPLICATION

    Which of the following is an example of an ultimate consumer?
    a. a newspaper reporter who buys a plane ticket to Washington, D.C., to cover the presidential
       inauguration
    b. a school teacher who bought a ticket to the 2002 Winter Olympics opening ceremonies in
       Salt Lake City
    c. an office receptionist who renews the magazines that are found in the office waiting room
    d. a retailer who buys poster board to make signs for an upcoming store sale
    e. a landscaping firm employee who buys a new wheelbarrow to use to haul mulch at a new
       job site

    Answer: b Page: 23
    Rationale: An ultimate consumer is the person who uses the goods or services purchased
    themselves. Only Alternative B describes an individual who will not be using his or her
    purchase in a job-related task.

1-140 ORGANIZATIONAL BUYERS                                                         DEFINITION

    Units such as manufacturers, retailers, or government agencies that buy for their own use or
    resale are collectively referred to as:
    a. intermediate buyers.
    b. purchasing agents.
    c. organizational buyers.
    d. professional buyers' organizations.
    e. manufacturing agents.

    Answer: c Page: 23
    Rationale: Key term definition—organizational buyers

1-141 ORGANIZATIONAL BUYERS                                                         DEFINITION

    Organizational buyers are most accurately described as:
    a. buyers of high cost items.
    b. buyers of household items.
    c. manufacturers, retailers, or government agencies buying for their own use or resale.
    d. any individual or group making a purchase worth over $100,000.
    e. any man, woman, or child who uses goods purchased for a household.

    Answer: c Page: 23
    Rationale: Key term definition—organizational buyers




                                              50
1-142 ORGANIZATIONAL BUYERS                                                         APPLICATION

     Which of the following is the best example of an organizational buyer?
     a. a mother buying milk for her young son
     b. a computer programmer buying the latest game for his Playstation
     c. a store owner buying hand-painted slate signs to sell in her store
     d. a botanist buying a rose bush for his home garden
     e. a baseball player buying a t-ball set for his daughter

     Answer: c Page: 23 Other Locations: W
     Rationale: Organizational buyers are manufacturers, retailers, or government agencies buying
     for their own use or resale. Only Alternative C describes an individual who will not use his or
     her purchases for personal use.

1-143 WEB LINK                                                                      APPLICATION

     The Hermitage is a famous Russian art museum that is suffering financial difficulties as the
     result of lost funding and a decrease in tourists. The decrease in visitors is blamed on a lack of
     awareness of the treasures contained in the museum. As a result, the Hermitage's director has
     used strategic alliances to create a website where people can go and view some of the wonders
     of the Hermitage. It is hoped that this sampling will encourage visitors and ensure the
     Hermitage is able to maintain its collections. One of the leading donors in this program to create
     the Hermitage website was IBM. _____ most likely explains why IBM donated $2 million to
     the project.
     a. The societal marketing concept
     b. The marketing concept.
     c. Consumerism.
     d. A sense of environmental responsibility.
     e. Capitalism.

     Answer: a Page: 24
     Rationale: The view, which holds that an organization should assess and satisfy the needs of
     customers in a way that also provides for society's well being is defined as the societal
     marketing concept.

1-144 UTILITY                                                                          DEFINITION

     The benefits or customer value received by users of a product is called:
     a. consumerism.
     b. entropy.
     c. utility.
     d. autonomy.
     e. synergy.

     Answer: c Page: 24-25
     Rationale: Key term definition—utility



                                                51
1-145 UTILITIES                                                                        DEFINITION

     The four utilities created by marketing are:
     a. product, price, promotion, and place.
     b. form, place, product, and quality.
     c. monopoly, monopolistic competition, pure competition, and oligopoly.
     d. form, place, time, and possession.
     e. gas, oil, electricity, and water.

     Answer: d Page: 25
     Rationale: Key term definition—utility

1-146 FORM UTILITY                                                                  CONCEPTUAL

     Which of the following statements is an example of form utility?
     a. A new motor oil container comes equipped with a disposable pouring spout.
     b. Stamp vending machines are located in drug stores.
     c. A service station has a 24-hour ice machine available for use even when the station is
        closed.
     d. A waterbed company offers six-month financing, same as cash.
     e. A gourmet shop offers a home delivery service.

     Answer: a Page: 25 Other Locations: SG
     Rationale: The disposable spout adds an extra benefit to the original product making it more
     valuable to the consumer.

1-147 FORM UTILITY                                                                  APPLICATION

     The owners of Old School Brand Authentic Antique Foods researched Civil War-era cookbooks
     and to come up with recipes for the old-fashioned products the company produces and markets.
     Their concern with the authenticity of their recipes reflects a concern with _____ utility.
     a. time
     b. place
     c. possession
     d. market
     e. form

     Answer: e Page: 25
     Rationale: The authenticity of the recipes adds an extra benefit to the original product making it
     more valuable to the consumer.




                                                52
1-148 FORM UTILITY                                                                  APPLICATION

     The process of taking wool off sheep and using it to make paint rollers shows how
     manufacturing can create _____ utility.
     a. time
     b. place
     c. possession
     d. market
     e. form

     Answer: e Page: 25
     Rationale: The production of the paint roller constitutes form utility.

1-149 PLACE AND TIME UTILITY                                                        APPLICATION

     Vending machines in dormitories create _____ utilities.
     a. time and place
     b. form and place
     c. possession and time
     d. time and form
     e. form and possession

     Answer: a Page: 25
     Rationale: Place utility is having an offering available where consumers need it. Time utility is
     having an offering available when consumers need it.

1-150 PLACE UTILITY                                                                 CONCEPTUAL

     Which of the following statements is an example of place utility?
     a. A new motor oil container comes equipped with a disposable pouring spout.
     b. Stamp vending machines are located in post office lobbies.
     c. A service station sells both regular gasoline and diesel fuel.
     d. A waterbed company offers six-month financing, same as cash.
     e. Disposable diapers come equipped with resealable tabs.

     Answer: b Page: 25
     Rationale: Place utility is having an offering available where consumers need it. The stamps
     are available where they would be used, where letters would be mailed.




                                                53
1-151 TIME UTILITY                                                                  APPLICATION

     Which of the following statements is an example of time utility?
     a. A new motor oil container comes equipped with a disposable pouring spout.
     b. Supermarkets are adding restaurants.
     c. A service station has a 24-hour ice machine available for use even when the station is
        closed.
     d. A waterbed company offers six-month financing, same as cash.
     e. Disposable diapers come equipped with resealable tabs.

     Answer: c Page: 25
     Rationale: Time utility means having a good or service available when it is needed. The ice
     machine allows consumers access whether their need for ice occurs at six in the morning or six
     in the evening.

1-152 POSSESSION UTILITY                                                            APPLICATION

     Which of the following statements is an example of possession utility?
     a. A new motor oil container comes equipped with a disposable pouring spout.
     b. The local dairy offers delivery to the customer's doorstep.
     c. Disposable diapers come equipped with resealable tabs.
     d. A gourmet food store carries a line of ready-made salads.
     e. A waterbed company offers six-month financing, same as cash.

     Answer: b Page: 25
     Rationale: Possession utility is the value to the consumer of getting a good or service to them so
     they can use it. The dairy's delivery allows access to milk, cream, butter, and other products for
     people who have a need for those products but limited ways to obtain them.

1-153 POSSESSION UTILITY                                                            APPLICATION

     Few consumers pay cash when they purchase a home. To do so would require the average
     consumer to save money for many, many years. Instead, most consumers take out a bank
     mortgage on their home—and make monthly payments until the house is paid off. By offering
     home mortgages, banks enable consumers to buy homes much sooner than they otherwise
     could. In essence, the bank is a marketer providing _____ utility.
     a. form
     b. time
     c. price
     d. possession
     e. place

     Answer: d Page: 25 Other Locations: W
     Rationale: Possession utility is the value to the consumer of getting a good or service to them so
     they can use it.




                                                54
1-154 POSSESSION UTILITY                                                             APPLICATION

     Robert could not afford to buy his principles of marketing text this semester if the bookstore did
     not accept credit cards. With his credit card, he was able to have the book for his first marketing
     class. The credit card created _____ utility for Robert.
     a. form
     b. time
     c. price
     d. possession
     e. place

     Answer: d Page: 25 Other Locations: SG
     Rationale: Possession utility is the value to the consumer of getting a good or service to them so
     they can use it. .

1-155 VIDEO CASE: ROLLERBLADE, INC.                                                  CONCEPTUAL

     To achieve the success in marketing that she did, Mary Howarth admits it was not easy. “It took
     months and years or hard work,” she said, “and perhaps most of all it took a lot of _____!”
     a. luck
     b. money
     c. imagination
     d. courage
     e. professional advice

     Answer: c Page: 26-27
     Rationale: The video case description in the text begins with a quote in which Mary Horwarth
     alludes to the need for “lots of imagination!”

1-156 VIDEO CASE: ROLLERBLADE, INC.                                                  APPLICATION

     Rollerblade, Inc., licensed the trade name for its inline skates to:
     a. Kool Air for an after-skating beverage mix called Rollerblade Blast.
     b. Mattel for a doll called Rollerblade Baby.
     c. Gillette for a new razor called Rollerblade Close.
     d. Goodyear for an all-terrain tire for recreational vehicles called Rollerblade Wild.
     e. PaperMate for a pen with a built-in clipper to cut out newspaper and magazine articles
         called Rollerblade Pro.

     Answer: b Page: 26-27
     Rationale: Video case #1 shows Mary Howarth in an interview referring to licensing to Mattel,
     followed by a cut from the Rollerblade Baby television commercial.




                                                55
1-157 VIDEO CASE: ROLLERBLADE, INC.                                                APPLICATION

     Which of the following marketing actions could Rollerblade, Inc. take to expand its sales?
     a. Develop a lower-priced skate that could be sold through mass-merchandise outlets like
        Wal-Mart and Target.
     b. Use Nordica’s experience in Europe to market its current line of in-line skates in Europe.
     c. Continue to defend its “Rollerblade” trademark to retain its image as the industry leader.
     d. All of the above.
     e. None of the above.

     Answer: d Page: 26-27
     Rationale: Each of the first three response options could lead to greater sales of Rollerblade
     in-line skates in today’s competitive environment.

1-158 VIDEO CASE: ROLLERBLADE, INC.                                                APPLICATION

     Mary Howarth and Rollerblade, Inc., face a distinctly different marketing task in expanding
     sales today as opposed to their situation in 1986. Which strategy below is most appropriate for
     today’s environment?
     a. Capturing the awareness of skiers to get them to try Rollerblade in-line skates.
     b. Developing a series of new models targeted at the special needs of specific market
          segments of in-line skates.
     c. Giving away free skates to sporting goods stores in the Midwest to let them allow people
          who have never heard of in-line skating to try them.
     d. Joining with its competitors to do a Super Bowl half-time show to promote the sport of
          in-line skating.
     e. Targeting educational advertisements at traditional “quad” roller skaters to get them to try
          in-line skates.

     Answer: b Page: 26-27
     Rationale: All the choices except b may have been appropriate in 1986 to educate the market
     about in-line skates. However, in today’s environment, Howarth and Rollerblade, Inc., must
     find ways to take sales from more than 30 competitors—the purpose of answer b.




                                               56
                           CHAPTER 1
 DEVELOPING CUSTOMER RELATIONSHIPS AND VALUE THROUGH MARKETING

                                SHORT ESSAY QUESTIONS

1-159 STUDENTS AS MARKETING EXPERTS                                               CONCEPTUAL

     Why are you, as a student, already somewhat of an expert in marketing before taking this
     course?

     Answer:
     Students are, in a sense, marketing experts because they do many marketing activities every
     day. They know many marketing terms, concepts, and principles. Experiences in shopping for
     products—and maybe even in selling them—gives students great insights into the world of
     marketing.

     Page: 7-8

1-160 DIVERSE FACTORS IN MARKETING                                                CONCEPTUAL

     In addition to consumers, what other people, groups, and forces interact to affect marketing
     activities and results?

     Answer:
     Foremost is the organization that is doing the marketing, including its mission, objectives and
     goals, top management, marketing department, other departments, and employees. In addition
     to customers there are shareholders or owners of companies, representatives of groups served in
     the case of nonprofit organizations, and suppliers. Environmental forces include social,
     economic, technological, competitive, and regulatory. And, lastly, society as a whole must be
     taken into account with respect to marketing plans and activities. The organization must strike
     an acceptable balance among all these influences. See also Figure 1-3.

     Page: 10

1-161 REQUIREMENTS FOR MARKETING TO OCCUR                                             DEFINITION

     At least four factors are required for marketing to occur. What are they?

     Answer:
     For marketing to occur, at least four factors are required:
     (1) two or more parties (individuals or organizations) with unsatisfied needs,
     (2) a desire and ability on their parts to satisfy those needs,
     (3) a way for the parties to communicate
     (4) something to exchange.

     Page: 11



                                               57
1-162 REQUIREMENTS FOR MARKETING TO OCCUR                                           APPLICATION

     During the 2000 presidential election, voters in states where Gore would definitely win were
     matched with Nader-supporters in states where Gore's lead was questionable. Websites were
     created which allowed voters to agree to swap votes so that Nader could win his five percent of
     the vote in that state and qualify for federal funding of his campaign and Gore could gain a vote
     in a state where his lead was shaky. Did marketing occur here? Explain your answer.

     Answer:
     To answer this question, students will need to know the four factors that are required for
     marketing to occur.
     (1) There must be two or more parties with unsatisfied needs. There were Nader supporters
          who wanted Nader's campaign to be federally funded and Gore supporters who wanted
          him to become president.
     (2) There must be a desire and an ability to satisfy those needs. The existence of the website
          gave the two the ability to satisfy the desire to help their respective candidates.
     (3) There must be a way for the parties to communicate. The website was the communication
          medium.
     (4) There must be something to exchange. Who the voter cast his or her vote for was
          exchanged. Students should be able to see that marketing did occur.

     Page: 11

1-163 NEEDS AND WANTS                                                                 DEFINITION

     How do you define needs and wants?

     Answer:
     A need occurs when a person feels physiologically deprived of basic necessities like food,
     clothing, and shelter. A want is a felt need that is shaped by a person's knowledge, culture, and
     personality. Because there is such a debate over the exact meanings of need and want, the terms
     are used interchangeably in the book.

     Page: 13




                                                58
1-164 TARGET MARKET                                                                APPLICATION

    Describe three different target markets, for three different products or services you, your
    friends, or family have recently purchased or used.

    Answer:
    A target market is a specific group of potential consumers whose needs and wants the
    organization can satisfy, and on whom the organization therefore can most efficiently and
    productively concentrate for marketing purposes. In response to this question, students might
    define the target market for a local baseball team as people who live in the area, somewhat
    skewed toward males, perhaps, and heavily 25 to 65 years of age. This question offers a good
    opportunity for class discussion of the more interesting examples and observations of students.

    Page: 14

1-165 MARKETING MIX/TARGET MARKETING/RELATIONS                                     APPLICATION

    Imagine you have the sole marketing rights to a new herbal shampoo that stops hair loss and
    actually causes new hair growth. You plan to sell your product on an Internet site, which you
    will advertise on late night television. You are also hoping to obtain free publicity in men's
    fashion magazines. You are planning on selling a 16-ounce bottle for $24.99 plus $7.99
    shipping and handling.

    (A)   Using the information provided, identify each element of your marketing mix.
    (B)   Identify the target market for your shampoo.
    (C)   How can you use relationship management to increase sales?

    Answer:
    (A) The shampoo is the product element. The Internet is the place element. The ads on late
        night television and the publicity are the promotion element. The price element is the
        $24.99 price plus the $7.99 for shipping and handling.
    (B) The target market is obviously men and women with hair loss. Better students will note
        that not everyone will be able to afford the product and that the target market should also
        include some kind of an income base.
    (C) Since you are selling on the Internet, you could use relationship marketing by sending
        monthly e-mail information concerning information about issues of interest to your target
        market. You could also offer a free 11th bottle of shampoo after a consumer buys 10
        bottles over a period of time. Students, of course, may come up with other equally viable
        ideas.

    Page: 14, 16




                                               59
1-166 MARKETING CONCEPTUAL                                                           DEFINITION

    What is the marketing concept?

    Answer:
    The marketing concept is the idea that an organization should strive to satisfy the needs of
    consumers, while also trying to achieve the organization's goals.

    Page: 21

1-167 CUSTOMER RELATIONSHIP MANAGEMENT                                             APPLICATION

    About Thanksgiving, kiosk stores appear in many malls. Typically the kiosks sell gift boxes of
    cheese, jewelry, and other items people think are appropriate seasonal gifts. In January these
    kiosk retailers vanish. Is it possible for such a kiosk retailer to use customer relationship
    management? Explain your answer.

    Answer:
    Generally, students will say no based on the definition of CRM. The text defines CRM as the
    process of identifying prospective buyers, understanding them intimately, and developing
    favorable long-term perceptions of the organization and its offerings so buyers will choose them
    in the marketplace. However, this idea is based on the idea that the kiosks are not there long
    enough to establish a long-term relationship. However, very insightful students may see an
    opportunity for these retailers (who return year after year) to develop long-term multi-year
    relationships. Databases would allow direct mail notifications that the prized gifts are again
    available.

    Page: 21

1-168 MICROMARKETING AND MACROMARKETING                                            CONCEPTUAL

    What is the difference between micromarketing and macromarketing?

    Answer:
    Micromarketing focuses on how an individual organization uses the strategic marketing process
    to direct its marketing activities and allocate its resources. Macromarketing looks at the
    aggregate flow of a nation's goods and services to benefit society. While micromarketing tends
    to be internal, macromarketing addresses broader societal issues such as whether marketing
    costs too much or whether advertising is wasteful.

    Page: 22




                                              60
1-169 ULTIMATE CONSUMERS/ORGANIZATIONAL BUYERS                                     APPLICATION

     Briefly describe an ultimate consumer versus an organizational buyer dinner bought from a
     caterer.

     Answer:
     Students’ examples will differ, but each example should be descriptive of the definition.
     Ultimate consumers are people who use the goods and services purchased for a household. One
     example might be a wedding reception or a wedding rehearsal dinner. Organizational buyers
     are units that buy goods for their own use or resale. An example would be an awards banquet
     for a company's leading salesperson.

     Page: 23

1-170 WHO BENEFITS FROM MARKETING?                                                 CONCEPTUAL

     In our free-enterprise society, what three specific groups benefit from effective marketing?

     Answer:
     The three specific groups that benefit from effective marketing are:
     (1) consumers who buy (they can obtain the best product at the lowest price)
     (2) organizations that sell (receive rewards, profits, growth, etc.)
     (3) society as a whole (through enhanced competition, and a higher standard of living for its
           citizens).

     Page: 23-24

1-171 MARKETING BENEFITS                                                           CONCEPTUAL

     Who benefits from marketing in our society, and how?

     Answer:
     Virtually everyone benefits from marketing in our society: consumers who buy, organizations
     that sell, and society as a whole. True competition between products and services in the
     marketplace ensures we as consumers can obtain the best goods and services available at the
     lowest price. Providing the maximum number of choices leads to the consumer satisfaction and
     quality of life we have come to expect from our economic system. (An extended answer could
     relate to utilities of form, place, time, and possession. This question can be used to prompt
     stimulating class discussion.)

     Page: 23-25




                                               61
1-172 UTILITIES CREATED BY MARKETING                                                   DEFINITION

     Explain the four utilities created by marketing.

     Answer:
     Marketing creates utility, or value, for consumers using a product. The four utilities include:
     form, place, time, and possession. The production of goods or services constitutes form utility.
     Place utility means having the offering available where consumers need it. Time utility means
     having it available, when needed. Possession utility is getting the product to consumers so they
     can use it.

     Page: 25

1-173 THE INFLUENCE OF MARKETING                                                    CONCEPTUAL

     Do you think marketing is a good or a bad influence on our society? Explain your position as
     specifically as you can.

     Answer:
     A student may take the position of the ancient Greek sophists and Karl Marx that marketing is
     the province of the sick and weakly, the dishonest and the exploitative. Or they may take the
     more modern position that marketing has provided the highest standard of living, and the
     greatest freedom for the greatest numbers of people that the world has ever known. By the time
     they have finished reading this chapter, it is to be hoped that more students will take the latter
     position than the former.

     Page: 5-25




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TEST ITEM TABLE FOR
CHAPTER 2 GOES HERE




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