80Test bank for marketing management a strategic decision making approach 7th edition by mullin

80Test Bank for Marketing Management A Strategic
Decision Making Approach 7th Edition by Mullin
Multiple Choice Questions
When a non-profit organization, like a university, purchases
copying paper for its photocopying machines, what is
it purchasing?
1.
2.
3.
4.
5.

A. A consumer good.
B. A consumer service.
C. An industrial good.
D. An industrial service.
E. An emotional good.

“A social process involving the activities necessary to
enable individuals and organizations to obtain what
they need and want through exchanges with others” is
a definition of:
1.
2.
3.
4.
5.

A. distribution.
B. marketing.
C. barter.

D. countertrade.
E. industrialization.

“Individuals and organizations who are interested and willing
to buy a particular product to obtain benefits that will
satisfy a specific need or want, and who have the
resources to engage in such a transaction” is the
definition of a(n):
1.
2.
3.
4.
5.

A. industrial buyer.
B. segment.
C. opportunity.
D. focus group.
E. market.

A society cannot reap the full benefits of specialization until
it develops the means to facilitate:
1.
2.
3.
4.
5.

A. importation of essentials from other societies.
B. production of essentials by each member of society.

C. the trade and exchange of surpluses among its members.
D. countertrade with other societies.
E. production of goods in addition to services.


What factor has changed in the past 10 years that has made
the customer service function far more important to
the firm’s financial success?
1.
2.
3.
4.
5.

A. global population levels.
B. global competition levels.
C. database marketing.
D. wireless communications.
E. market fragmentation.

What type of strategy states the company’s mission and its
strengths and policies for growth?
1.
2.
3.
4.
5.

A. Business-level strategy
B. Functional strategy

C. Marketing strategy
D. Corporate strategy
E. Segmentation strategy

Factors not created by marketers or other social forces, but
flowing from basic biological and psychological
human makeup, are:
1.
2.
3.
4.
5.

A. needs.
B. wants.
C. demands.
D. urges.
E. requirements.

The most important characteristic of marketing as a
business function is its focus on:
1.
2.
3.
4.
5.

A. interfunctional responsibilities.
B. customer needs.
C. barter exchange requirements.

D. production efficiencies.
E. technological trends.

Those who sell goods and services directly to final
consumers for their personal, nonbusiness use are:
1.
2.
3.
4.
5.

A. retailers.
B. agent middlemen.
C. merchant wholesalers.
D. facilitating agents.
E. commissioned agents.


When a buyer purchases a new Fiat Punto and the purchase
price includes free parts and labor on repairs that
occur within the first three years or 36,000 miles,
whichever comes first, what aspect of the product
does this component represent?
1.
2.
3.
4.
5.

A. Return policy

B. Warranty
C. Sales promotion
D. Allowance
E. Spare parts availability

Analyzing the 4Cs is necessary to provide the foundation for
a good strategic marketing plan. Which of the
following is NOT one among them?
1.
2.
3.
4.
5.

A. Company
B. Context
C. Customers
D. Cost
E. Competitors

Those who buy goods and services for their own personal
use or the use of others in their immediate household
are:
1.
2.
3.
4.
5.

A. utilitarian consumers.

B. organizational customers.
C. intermediaries.
D. industrial customers.
E. ultimate consumers.

When a company is attempting to differentiate its products
to distinguish them from competitors’ products, in
which aspect of strategic management planning is the
company engaged?
1.
2.
3.
4.
5.

A. Market segmentation strategy
B. Distribution strategy
C. Targeting strategy
D. Pricing strategy
E. Positioning strategy

For some brand loyal customers what does wearing Levi’s
501 jeans provide that other jeans cannot?
1.

A. Need fulfillment


2.
3.

4.
5.

B. Need creation
C. Need recognition
D. Want satisfaction
E. Want recognition

A gap between a person’s actual and desired state on some
physical or psychological dimension is a(n):
1.
2.
3.
4.
5.

A. unsatisfied need.
B. want state.
C. market inefficiency.
D. demand function.
E. intermediary.

Which aspect of the marketing management process does
environmental and competitor analysis represent?
1.
2.
3.
4.
5.

A. Marketing program components
B. Implementing and controlling marketing programs
C. Formulating strategic marketing programs
D. Market opportunity analysis
E. Strategic market communication

Studies have shown that, if their complaints were handled
satisfactorily, ____ percent of those who complain
would do business with the same company again.
1.
2.
3.
4.
5.

A. 30
B. 10
C. 50
D. 70
E. 90

When a consumer purchases a product at a convenient
location and when she is ready to use the product, we
say that the product has achieved _________ utility
and _________ utility, respectively.
1.
2.
3.
4.
5.

A. time; place
B. place; time
C. possession; place
D. possession; functional
E. time; possession


When a company is attempting to determine what markets to
target their product towards as part of its strategic
marketing planning activities, which of the following is
it attempting to define?
1.
2.
3.
4.
5.

A. Why its competitors have not already exploited this niche.
B. What the best promotion vehicle would be for this market.
C. Which segments have to be targeted.
D. How to position the product.
E. What its distribution strategy would be.

Haier, the rapidly growing Chinese manufacturer of washing
machines discussed in the text, modifies its product
designs and marketing programs to the needs of
customers in Saudi Arabia. The company is:
1.
2.

3.
4.
5.

A. trying to provide a unique benefit to a segment of the washing machine market.
B. trying to provide a unique benefit to the overall market for washing machines.
C. production oriented.
D. trying to position its product as a me-too type of washing machine.
E. trying to build economies of scale.

What type of decision is reflected in an organization’s
business-level strategy?
1.
2.
3.
4.
5.

A. Choosing suppliers
B. Picking an advertising slogan
C. Deciding how to compete in its business
D. Deciding which products to sell
E. Defining its overall purpose

“The process of analyzing, planning, implementing,
coordinating, and controlling programs involving the
conception, pricing, promotion, and distribution of
products, services, and ideas designed to create and
maintain beneficial exchanges with target markets for
the purpose of achieving organizational objectives” is

a definition of:
1.
2.
3.
4.
5.

A. marketing communications.
B. marketing management.
C. marketing strategy.
D. strategic management.
E. marketing tactics.


In developed countries, approximately what percentage of
the retail price of consumer products consists of the
costs of marketing and distribution of these products?
1.
2.
3.
4.
5.

A. 10 percent
B. 30 percent
C. 50 percent
D. 70 percent
E. 90 percent

Because manufacturers and their agents can perform

exchange activities at a lower cost than individual
consumers, we say that they have achieved:
1.
2.
3.
4.
5.

A. price efficiency.
B. functional efficiency.
C. transaction efficiency.
D. vertical integration.
E. horizontal integration.

Groups of institutions, or middlemen, that distribute goods
are known as:
1.
2.
3.
4.
5.

A. pyramid distribution systems.
B. cohesive distribution system.
C. horizontal distribution systems.
D. wheel-and-spoke distribution systems.
E. marketing channels.

What is the focus of marketing management?
1.

2.
3.
4.
5.

A. Analysis
B. Coordination
C. Beneficial exchange
D. Distribution
E. Execution

The desire to drink a Coke instead of orange juice is an
example of a(n):
1.
2.
3.
4.
5.

A. necessity.
B. need.
C. demand.
D. want.
E. requirement.


When people buy products to satisfy their wants and needs,
instead of buying the products per se, they are
buying:
1.

2.
3.
4.
5.

A. performance features.
B. product attributes.
C. benefits.
D. physical attributes.
E. goods.

In addition to being provided with physical objects, people’s
needs may be satisfied in a less tangible form
through:
1.
2.
3.
4.
5.

A. differential forms.
B. products.
C. goods.
D. services.
E. product modifications.

Quality, features, style, options, brand name, packaging,
guarantees and warranties, and service are related to
which element of the marketing mix?
1.

2.
3.
4.
5.

A. Place
B. Price
C. Product
D. Promotion
E. Personnel

Those who buy goods and services for resale, as inputs to
production of other goods or services, or for use in the
day-to-day operations of the organization are:
1.
2.
3.
4.
5.

A. intermediaries.
B. ultimate consumers.
C. organizational customers.
D. utilitarian consumers.
E. countertraders.

When PepsiCo attempts to define which products,
promotions, prices, and distribution arrangements to
include in its snacks food line, what type of strategy is
it pursuing?

1.
2.
3.

A. Marketing strategy
B. Functional-level strategy
C. Corporate strategy


4.
5.

D. Operational strategy
E. Market segmentation strategy

A manufacturer’s representative for General Electric is an
example of which type of “middleman?”
1.
2.
3.
4.
5.

A. Retailers
B. Agent middlemen
C. Merchant wholesalers
D. Facilitating agents
E. Commissioned agents

When the market is sufficiently homogeneous, a company

can practice marketing approaches that are:
1.
2.
3.
4.
5.

A. pre-emptive.
B. differentiated.
C. segmented.
D. situational.
E. undifferentiated.

The utilization of marketing approaches by hospitals,
theaters, universities and nonprofit organizations:
1.
2.
3.
4.
5.

A. has not changed compared to practices in the past.
B. has increased substantially in the recent past.
C. is outside the domain of marketing per se.
D. is only appropriate in for-profit situations.
E. has decreased substantially in the past decade.

Dell Computer’s reliance on the Internet to attract customers
and process orders together with a flexible
manufacturing system that produces computers to

order and minimizes finished inventories, and Canon’s
reliance on its own factories, salesforce, and
distribution facilities to produce and market its copiers
and printers are examples of a:
1.
2.
3.
4.
5.

A. vertically integrated distribution system.
B. horizontally integrated distribution system.
C. wheel-and-spoke distribution system.
D. cohesive distribution system.
E. pyramid selling system.

Advertising, personal selling, point-of-purchase displays,
and publicity are related to which element of the
marketing mix?
1.

A. Place


2.
3.
4.
5.

B. Product

C. Price
D. Promotion
E. Personnel

The primary advantage to direct distribution for a firm like
Dell computers is:
1.
2.
3.
4.
5.

A. more control over channel activities.
B. less hassle for the customer.
C. broader market coverage.
D. lower distribution costs.
E. less hassle for the firm.

When the total market for a given product category is
fragmented into several groups of people having
relatively homogeneous needs, wants, and sought
after benefits, these groups are termed:
1.
2.
3.
4.
5.

A. market fragmentation.
B. a differentiated market.

C. a counter-market.
D. a market segment.
E. market homogenization.

_____ is the combination of controllable marketing variables
that a manager uses to carry out a marketing strategy.
1.
2.
3.
4.
5.

A. Advertising
B. Pricing strategy
C. Market segmentation
D. Publicity
E. Marketing mix


True - False Questions
Available data suggests that roughly 80 percent of Internet
revenues are from Business-to-Consumer (B2C)
transactions.
1.
2.

True
False

Though the boundaries between functional areas still

remain, marketing programs are increasingly
becoming a group activity.
1.
2.

True
False

When people buy products to satisfy their needs, they are
really buying the benefits they believe the products
provide, rather than the products per se.
1.
2.

True
False

Value is a function of extrinsic product features, service, and
price.
1.
2.

True
False

Venus prefers to buy a week’s groceries on a single trip to
the supermarket rather than engage in separate
transactions with a butcher, a baker, and a variety of
food processors, thereby increasing transactional
efficiency.

1.
2.

True
False

A product has greater place utility for a potential customer
when it can be purchased with a minimum of risk and
shopping time.
1.
2.

True
False


The title marketing manager is necessarily and intentionally
vague because many people are directly involved with
an organization’s marketing activities.
1.
2.

True
False

A brand’s value to the company depends on how much value
the company thinks the brand provides customers.
1.
2.

True
False

The primary purpose of marketing activities is to facilitate
and encourage exchange transactions with potential
customers.
1.
2.

True
False

Each market segment seeks a different set of benefits from
the same product category.
1.
2.

True
False

Lifetime customer value is the present value of a stream of
revenue that can be produced by a customer over
time.
1.
2.

True
False

A service can be defined as “any activity or benefit that one

party can offer another that is essentially intangible
and that does not result in the ownership of anything.”
1.
2.

True
False

All marketing activities that are performed in-house are
within the domain of the marketing department.
1.
2.

True
False

The intangible nature of many services can create unique
challenges for marketers.
1.

True


2.

False

According to management guru Peter Drucker, everything a
company does internally is a cost center.
1.

2.

True
False

Marketers and other social forces can create needs deriving
from the biological and emotional imperatives of
human nature.
1.
2.

True
False

The laws of probability dictate that at least half of all new
products should succeed if a sufficient amount is
spent on marketing research.
1.
2.

True
False

Implementing a marketing plan requires cooperation and
coordination across many specialized functional
areas, but the final authority should always be the
marketing department. In short, marketing should not
be “everybody’s business.”
1.
2.

True
False

In the financial markets it is a company’s top line—its sales
—that is most important.
1.
2.

True
False

Decreased division and increased specialization of labor are
some of the most important changes that occur as
societies move from a primitive economy toward
higher levels of economic development.
1.
2.

True
False

An unsatisfied need is a gap between a person’s actual and
desired states on some physical or psychological
dimension.
1.

True

2.

False

The controllable elements of a marketing program are the
product offering; price; promotion; and place.
1.
2.

True
False

The four Cs that need to be analyzed before decisions are
made concerning specific components of the
marketing program are customer, cost, category, and
the company itself.
1.
2.

True
False

Auction sites, such as eBay, QXL are examples of
Consumer-to-Consumer (C2C) channels.
1.
2.

True
False

In the first part of a marketing plan, the marketing manager
usually details the strategy for the coming period.
1.
2.

True
False

Internal control of the full range of marketing functions and
activities is referred to as vertical integration.
1.
2.

True
False

Information available over the Internet is affecting consumer
purchase patterns even when the purchases are made
in traditional retail outlets.
1.
2.

True
False

IBM has reduced its focus and the proportion of resources it
devotes to its traditional computer hardware
businesses and is now seeking future growth and
profits by investing heavily in developing information
engineering, software, and business consulting

services. This change in emphasis reflects IBM’s new
business-level strategy.
1.

True


2.

False

One benefit of an extensive marketing system is that
specialization of labor and economies of scale lead to
functional efficiency.
1.
2.

True
False

Merchant wholesalers sell goods and services directly to
final consumers for their personal, nonbusiness use.
1.
2.

True
False


Free Text Questions

Discuss brand equity.
Answer Given

The assets—including customers’ perceptions of a product’s benefits and value,
their positive past experiences, and their loyalty over time—linked to a brand’s
name and symbol constitute the brand’s equity. Brand equity reflects the value of
the brand name and logo as promotional tools for attracting future buyers and
building market share and profitability. A brand’s value to the company depends on
how much value customers think the brand provides for them; value creation cuts
both ways.

Describe and provide an example of each of the three types
of product utility.
Answer Given

Lunch at a fast-food restaurant is a combination of the (1) lunch (possession
utility), (2) being conveniently located (place utility), (3) when you are ready for
lunch (time utility).

Compare and contrast the three levels of organizational
strategy.
Answer Given

Corporate strategy reflects the company’s mission and provides direction for
decisions about what business it should pursue, how it should allocate its available
resources, and its growth policies. Business-level strategy addresses how the
business intends to compete in its industry. Functional strategy, such as
marketing, involves decisions about implementation of specific tactics to reach
business-level goals (e.g., what products to offer a given market segment).

Discuss the value of long-term customer relationships.
Answer Given

As global markets have become increasingly competitive and volatile, many firms
have turned their attention to building a continuing long-term relationship between
the organization and the customer as the ultimate objective of a successful
marketing strategy. They are taking action to increase lifetime customer value —
the present value of a stream of revenue that can be produced by a customer over
time. For an automobile manufacturer, for instance, the lifetime value of a first-time
car buyer who can be kept satisfied and loyal to the manufacturer—buying all
future new cars from the same company—is well over a million dollars.

What are the important questions which a marketing
manager must ask in order to define a target market?
Answer Given


Questions such as: “Which customer needs or wants are not being well-satisfied
by our competitors?,”, “How do potential segments differ by important
demographic dimensions, in benefits desired, and in choice criteria?”, “Which
segments should we target and why have we chosen these segments?”, and “How
will we position our product so that we can differentiate it from our competitors’
offerings?” are typical questions that have to be answered in order to define a
target market.

What conditions must exist before an exchange occurs?
Answer Given

There must be (1) at least two parties, both of whom: (2) offer something of value,
(3) are aware of the other’s existence, (4) are free to accept or reject the other’s

offer, and (5) are willing to negotiate.

Distinguish between an ultimate consumer and an
organizational customer. Provide an example of each.
Answer Given

An example of the former is when a customer buys a shirt; the latter is when a
store’s management buys racks of clothing.

How many transactions must occur for three manufacturers
to sell to each of three consumers (a) without and (b)
with a distributor? What does this indicate about the
efficiency introduced by “middlemen”?
Answer Given

Without a distributor, each of the three manufacturers must contact each of the
three consumers separately, for a total of nine transactions. With a distributor,
each of the three manufacturers must contact the distributor once, and the
distributor must contact each consumer once, for a total of six transactions. From
the standpoint of total system transactions, the distributor based system is onethird more efficient.

List and describe the four types of marketing intermediaries.
Answer Given

Merchant wholesalers take title to the goods they sell and sell primarily to other
resellers; Agent middlemen also sell to other resellers and industrial or commercial
customers but they do not take title to the goods they sell; Retailers sell to ultimate
consumers; Facilitating agents, like advertising agencies and railroads, provide
specialized marketing functions.

What elements should be analyzed for a good strategic
marketing plan?
Answer Given


The analysis necessary to provide the foundation for a good strategic marketing
plan should focus on four elements of the overall environment that may influence a
given strategy’s appropriateness and ultimate success: (1) the company’s internal
resources, capabilities, and strategies; (2) the environmental context —such as
broad social, economic, and technology trends—in which the firm will compete; (3)
the needs, wants, and characteristics of current and potential customers; and (4)
the relative strengths and weaknesses of competitors and trends in the
competitive environment. Marketers refer to these elements as the 4Cs.