Marketing Strategies and Distribution Channels
M/C1. Are consumer products that the consumer either does not know about or knows about but does not normally think about buying. These products require a lot of advertising, personal selling, and other marketing efforts.A. Shopping products. – B. Unsought products. – C. Product mix. – D. Specialty products.2. Which of the following is true with regard to store brands?A. Store brands are also known as national brands.B. Increasing consumer distrust toward store brands has led to a store-brand slump.C. Store brands have been declining in popularity and strength for more than two decades.D. Store brands are created and owned by resellers of a product or service.3. A well-known cosmetic company in New York City added new product lines in order to increase its business. In other words, it ____.A. Engaged in social marketingB. Lengthened its existing product lineC. Decreased its product line consistencyD. Widened its product mix4. If a consumer purchases a new flat-screen ‘smart’ television, what is the augmented product involved?A. Connection to entertainment and informationB. Tech support and warrantyC. State-of-the-art technologyD. Slick and attractive packaging5. When Mercedes successfully introduced its C-Class cars at $30,000 without injuring its ability to sell other Mercedes cars for $100,000, it was an example of a successful ____.A. Upstream integrationB. Two-way stretchingC. Upward stretchingD. Downward stretching6. BlueFin canned tuna has higher sales than its unbranded rival, even though the unbranded tuna costs $0.45 less per can than BlueFin tuna. BlueFin most likely has ____.A. High brand equity – B. No brand commitment – C. Negative brand equity – D. Low brand relevance7. ___ are the sum of the ___ and ____ for any given level of productionA. Total costs; fixed; variable costs – B. Variable costs; fixed; total costs – C. Fixed costs; total; variable costs – D. Fixed costs; variable; total costs8. Fixed cost per unit ____ as the number of units produced increases.A. Decrease – B. Remain the same – C. Increase – D. Divide in half9. Multiprint, a printer manufacturing firm, sells ink cartridges for each of its specific models. Only Multiprint cartridges are compatible with Multiprint printers, and no two models share the same specifications. What type of pricing does Multiprint use?A. By-product pricing – B. Captive product pricing – C. Product line pricing – D. Product bundle pricing10. As production moves up, the average cost per unit decreases because ____.A. Variable costs decreaseB. Fixed costs are spread over more unitsC. Overhead costs decreaseD. Revenue increases11. Noticing that themed envelopes aren’t selling well, Charles Payton decides to offer customers a special ‘letter writing’ kit. He prices the kit which comprises letter paper, matching envelopes, and pens at $5, even though the combined prices of the individual items is $8. Which of the following pricing strategies is he using?A. Product bundle pricing – B. By-product pricing – C. Optional product pricing – D. Captive product pricingM/C12. Aldo Inc., a global conglomerate, designed the E-Brush, an electric toothbrush. Sensing market demand for the electric toothbrush, Aldo started with an ideal selling price of $13 based on customer value considerations and then targeted costs to ensure that the price was met. This exemplifies ____.A. Everyday low pricing – B. Cost-plus pricing – C. Target costing – D. High-low pricing13. ____ are the largest group of wholesalers. They include two broad types: full-service wholesalers and limited-service wholesalersA. Merchant wholesalers – B. Manufacturer sellers – C. Selling agents – D. Brokers14. Which of the following is an example of an indirect marketing channel?A. ‘June Bride, which sells bridal gowns via its click-to-order online catalogs’B. ‘Farmer Brown, who delivers fresh milk from his dairy to customers every morning’C. ‘M & M, which sells its picnic baskets to select novelty stores across the country’D. ‘Lifebelt Insurance, which sells life insurance through its door-to-door salespeople’15. Which of the following entities is present in a zero-level marketing channel?A. Consumers – B. Wholesalers – C. Brokers – D. Retailers16. Craftsman Furniture Company offers its bedroom and living room furniture through independent and smaller chain furniture stores, not through every store that sells furniture. It uses ____ distributionA. Direct – B. Intensive – C. Corporate – D. Selective17. While using the ____ method for setting an advertising budget, a company starts with total revenues, deducts operating expenses and capital outlays, and then devotes some portion of the remaining funds to advertising.A. Objective-and-task – B. Affordable – C. Percentage-of-sales – D. Competitive-parity18. More companies are adopting the concept of ____, which carefully integrates and coordinates the company’s many communication channels to deliver a clear, consistent, and compelling message about the organization and its brands.A. Nonpersonal communication channels – B. Integrated personal selling – C. Integrated marketing communications – D. Integrated competitive methods19. Based on the target audience, the communicator makes decisions regarding what will be said, who will say it, when it will be said, where it will be said, and ____.A. What noise to anticipate B. How frequently it will be said C. How much it will cost to prepare the message D. How it will be said20. P&G began to market shampoo for normal hair. In an attempt to increase profits and use excess market capacity, P&G then marketed shampoo for oily hair and color-treated hair. This is an example of ____.A. A shopping product – B. Brand extension – C. Line filling – D. Line stretching
21. Explain the five elements of the promotion mix (i.e., advertising, personal selling, sales promotion, direct marketing, and public relations)
ANSWER:
• Advertising: Presentation and promotion of ideas, goods, or services by an identified sponsor.• Personal selling: A procedures of assisting and persuading one or more chances to buy a good or service or to act on any idea by the use of an oral presentation.• Sales promotion: Limited time to enhance consumer demand, stimulate market demand or improve product availability.• Public relations: Service, or business unit by planting noteable news regarding it or a favorable presentation of it in the media.• Direct Marketing is and advertising that allows businesses and nonprofits to communicate directly to the consumers.22. Explain the direct distribution strategy and indirect distribution strategy with examples. Also, explain the three strategies of the distribution intensity. Give examples of each strategy.ANSWER:– Direct Distribution is a business technique that eliminates the need for any middlemen in the supply chain. Manufacturers directly sell through this mode of distribution, which means they bear a great deal more responsibility than merely producing a high-quality product for the market. For instance, an organization selling clothes and sell them directly to consumer by use of e-commerce can be used as direct distribution.– Indirect distribution It entails selling wholesale to brokers or retailers who will resell it for you. They keep, display, and sell it to customers. For instance: a company selling furniture and for selling its product they use lumber manufacture to furniture maker and then the retailers.– Intensive Distribution: Maximum outlets Intensive distribution aims to reach as many customers as possible. Intensive distribution example: Products like biscuits, wheat, chocolates– Selective Distribution: Selected outlets in specific locations – Exclusive distribution consists of opening limited outlets. Selective distribution: Gucci, Adidas – Exclusive distribution: Apple only allowing AT&T to sell the iPhone directly to consumers
23. Explain what is meant by the product line and explain its decisions (i.e., product line stretching and product line filling). Give an example of each decision (CLO 3).
ANSWER: A product line is a series of related products offered by the same company under a single brand name. Companies market many product lines under distinct brand names to help consumers distinguish between them.
Product line FilingIt is the process of adding new products to a company’s existing product line to increase its market share. For example, in the year 2000, Maruti Suzuki introduced the Alto, which was positioned between two existing Maruti models-the Maruti 800 and the Maruti Zen-as a product between the two.Product line stretchingBMW automobiles are priced in the elite tier of the automobile market’s price spectrum. Product line stretching occurs when a corporation expands its product line beyond the scope of its current product offering. The corporation has the flexibility to move its line down the market, up the market, or both ways.24. Compare and contrast market-skimming and market-penetration pricing strategies and discuss the conditions under which each is appropriateMarket skimmingThe producer sets a high initial price to attract consumers who have a strong demand for the product and the financial means to purchase it, and then gradually drops the price to attract buyers in the next and succeeding levels of the market. This technique is used for electronics productsMarket penetrationIn business, penetration pricing is a marketing approach that is used to attract customers to a new product and/or a reduced price during the product or service’s initial offering period. Because of the lower price, a new product or service is more likely to gain traction in the market and to lure customers away from competitors. This technique is used to attract new customers and used for general items products.