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MKTG 3700 > Exam 2 > Flashcards

Exam 2 Flashcards

1
Q

when a 1% decrease in price produces less than a 1% increase in quantity demanded thereby actually decreasing total revenue

A

inelastic demand

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2
Q

When establishing product line pricing, the lowest-priced item is typically positioned as

A

the traffic builder designed to capture the attention of hesitant or first-time buyers.

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3
Q

Process of having the sender transform an idea into a set of symbols

A

Encoding

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4
Q

Items that the consumer makes a special effort to search out and buy:

A

Specialty Products

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5
Q

Technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output

A

Break Even Analysis

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6
Q

setting prices for all items in a product line

A

product-line pricing

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7
Q

specifing a role of price in an organizations marketing and strategic plans

A

pricing objectives

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8
Q

New Product development process:

A
  1. New-Product strategy development
  2. idea generation
  3. screening and evaluation
  4. business analysis
  5. development
  6. market testing
  7. commercialization
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9
Q

Integrated Marketing Communications (IMC)

A

concept of designing marketing communications programs that coordinate all promotional activities to provide a consistent message across all audiences

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10
Q

A book on how to invest in collectibles spends several weeks on The New York Times bestseller list. The paperback book was originally released for $9.99. A reduction of the price to $8.99 pushed the sales up for 5%. This is due to the book having

A

inelastic demand

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11
Q

private branding

A

when a company manufactures products but sells them under the brand name of a wholesaler or retailer

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12
Q

When a manufacturer directs the promotional mix to channel members to gain their cooperation in ordering and stocking the product, it is using a(n) __________ strategy.

A

push

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13
Q

A budgeting method that allocates funds to a promotion as a percentage of past or anticipated sales, in terms of either dollars or units sold, is referred to as __________ budgeting.

A

percentage of sales

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14
Q

multibranding

A

company gives each product a distinct name

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15
Q

type of channel conflict that occurs when a channel member bypasses another member and sells or buys products direct

A

Disintermediation Channel Conflict

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16
Q

Introduction Marketing Objective

A

create consumer awareness and stimulate trial

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17
Q

consists of individuals and firms involved in the process of making a product or service available for use or consumption by consumers or industrial users

A

Marketing Channel

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18
Q

low-learning product shape

A

high to low curve

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19
Q

Advertising Strengths

A

efficient way to reach large number of people

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20
Q

a similar understanding and knowledge they apply to the message

A

Field of Experience

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21
Q

The terms continuous innovation, dynamically continuous innovation, and discontinuous innovation, are classifications based on:

A

degree of learning required by the consumer

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22
Q

Growth Promotional Activity

A
  • personal selling to intermediaries

- advertixing to differentiate

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23
Q

When a retailer owns a manufacturing operation, it is referred to as

A

backward integration

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24
Q

a firm selects a few retailers in a specific geographical area to carry its products

A

Selective Distribution

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25
Q

Break-even point quantity

A

FC/ UP-UVC

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26
Q

Introduction Promotional Activity

A
  • magazine publicity
  • advertising
  • saleforce calling
  • sales promotions: free samples
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27
Q

selling a product below its customary price to attract attention to it

A

loss leader pricing

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28
Q

Continuous Innovation

A

consumers don’t need to learn new behaviors

low learning

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29
Q

Promotional expenditures at the introduction stage of the product life cycle are spent on:

A

creating primary demand

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30
Q

marketing of two or more products in a single package price

A

bundle pricing

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31
Q

Advertising Weaknesses

A
  • high costs

- hard to receive good feedback

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32
Q

Factors that limit the range of prices a firm may set are referred to as:

A

pricing constraints

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33
Q

Products that are introduced, decline, and seem to return are characteristic of the __________ type of product life cycle.

A

fashion

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34
Q

Consists of all of the product lines offered by an organization:

A

product mix

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35
Q

when a producer owns the intermediary at the next level down in the channel

A

Forward Integration

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36
Q

Setting the low initial price on a new product to appeal immediately to the mass market

A

Penetration Pricing

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37
Q

high-learning product shape

A

gentle hill

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38
Q

Items which the consumer compares several alternatives on criteria such as price, quality or style:

A

shopping products

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39
Q

channel type when products and services available for consumption or use by consumers or organizational buyers while combining electronic and traditional intermediaries

A

Electronic Channel

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40
Q

Price Elasticity of Demand

A

% change in quanity / %change in price

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41
Q

a firm tries to place its products and services in as many outlets as possible Ex. convenience items

A

Intensive Distribution

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42
Q

Convenience products refer to:

A

products consumers purchase frequently, conveniently, and with a minimum of shopping effort.

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43
Q

Decline Promotional Activity

A

little money spent on promotion

44
Q

multi-product branding

A

company uses one name for all its products in a product class

45
Q

Channel conflict that arises when one member bypasses another member and sells or buys product directly is referred to as __________.

A

disintermediation

46
Q

Promotional budget funds are allocated to promotion as a percentage of past or anticipated sales in terms of either dollars or units sold

A

percentage of sales

47
Q

Setting prices a few dollars or cents under an even number

A

Odd-even pricing

48
Q

Promotional Elements that are Customized Promotion

A

Personal Selling and Direct Marketing

49
Q

directing the promotional mix to channel members to gain their cooperation in ordering and stocking the product

A

push strategy

50
Q

Personal Selling Weaknesses

A
  • very expensive per exposure

- message can vary between salesperson

51
Q

discontinuous innovation

A

requires new learning and consumption patterns by consumers

high learning

52
Q

__________ is the percentage change in quantity demanded relative to (divided by) the percentage change in price.

A

Price elasticity of demand

53
Q

To place a new item on a retailer’s shelf manufacturers pay a:

A

slotting fee

54
Q

Setting a high price so that quality-or status-conscious consumers will be attracted to the product and buy it is referred to as

A

prestige pricing

55
Q

Promotional Elements that are Mass Promotion

A

Advertising, Public Relations, Sales Promotion

56
Q

Process of having the receiver take a set of symbols the message and transform the symbols into an idea

A

Decoding

57
Q

A restaurant review published in the local newspaper is an example of __________.

A

publicity

58
Q

Decline Marketing Objective

A

deletion- dropping of the product

harvesting- retains but reduces marketing costs

59
Q

Sales Promotion Weaknesses

A
  • Easily abused
  • can lead to promotion wars
  • easily duplicated
60
Q

Setting a market price for a product or product class based on a subjective feel for the competitors’ price or market price as the benchmark is referred to as

A

above-market pricing
at market pricing
below market pricing

61
Q

when a 1% decrease in price produces more than a 1% increase in quantity demanded thereby actually increasing total revenue

A

elastic demand

62
Q

Price equation

A

list price - incentives and allowances + extra fees

63
Q

Setting the highest initial price that customers really desiring the product are willing to pay when introducing a new or innovative product is referred to as a

A

skimming strategy

64
Q

practice of replacing promotion allowance with lower manufacturer list prices

A

Everyday Low Pricing

65
Q

A new product does not achieve a predetermined sales target some retailers require a:

A

failure fee

66
Q

A group of product or service items that are closely related because they satisfy a class of needs, are used together, are sold to the same customer group, are distributed through the same types of outlets, or fall within a given price range is referred to as a __________.

A

product line

67
Q

Factors that limit the range of prices a firm may set are referred to as __________.

A

pricing constraints

68
Q

dynamically continuous innovation

A

disrupts consumer’s normal routine but does not require totally new learning
medium learning

69
Q

Maturity Marketing Objective

A

holding market share through further product differentiation and finding new buyers and uses.

70
Q

Direct Marketing Weaknesses

A
  • declining customer response

- database management is expensive

71
Q

Public Relations Strengths

A

most credible source in the consumer’s mind

72
Q

Promotional budget funds are allocated to promotion only after all other budget items are covered

A

All-You-Can-Afford

73
Q

Three basic functions performed by intermediaries:

A

transactional, logistical and facilitating functions

74
Q

Personal Selling Strengths

A
  • very persuasive

- can select audience and give complex information

75
Q

A marketing strategy that alters a product’s characteristic such as its quality, performance, or appearance to manage the length of product life cycle stagesis referred to as __________.

A

product modification

76
Q

A product mix refers to

A

all of the different product lines offered by an organization

77
Q

Penetration pricing refers to

A

setting a low initial price on a new product to appeal immediately to the mass market.

78
Q

extraneous factors tha can work against effective communication by distorting a message or the feedback received

A

Noise

79
Q

Direct Marketing Strengths

A
  • can be prepared quicly

- facilitates relationship with customer

80
Q

John Deere manufactures and distributes industrial and farm equipment. These types of equipment are considered to be specialty products. Which type of market coverage does John Deere likely use?

A

exclusive distribution

81
Q

Setting the highest initial price that customers who really desire the product are willing to pay

A

Skimming Pricing

82
Q

Marketers pay slotting fees to grocers in payment for space—or slots—on their retail shelves. Such slotting fees significantly increase the __________risk of the new-product process?

A

commercialization

83
Q

Public Relations Weaknesses

A

difficult to get media cooperation

84
Q

Schwan’s Sales Enterprises of Marshall, Minnesota, markets a full line of frozen foods in 49 states and parts of Canada using door-to-door salespeople who sell from refrigerated trucks. This particular method of distribution is called a:

A

direct channel

85
Q

Sales Promotion Strenghts

A
  • effective at changing behavior in short run

- very flexible

86
Q

type of channel conflict that occurs between intermediaries at the same level in a marketing channel such as between two or more retailers

A

Horizontal Channel Conflict

87
Q

The process of having the receiver take a set of symbols, the message, and transforming them back to an idea during the communication process is referred to as __________.

A

decoding

88
Q

Growth Marketing Objective

A

stimulating selective demand

89
Q

A firm’s profit equation demonstrates that profit equals __________.

A

Total revenue - Total cost

90
Q

Companies can employ four general branding strategies, which include: (1) multiproduct branding; (2) __________; (3) private branding; and (4) mixed branding.

A

multibranding

91
Q

channel type when intermediaries are inserted between the producer and consumers and perform numerous channel functions

A

Indirect Channel

92
Q

Integrated marketing communications (IMC) programs coordinate a variety of promotion alternatives to provide

A

a consistent message across audiences

93
Q

Dual distribution refers to

A

an arrangement whereby a firm reaches different buyers by employing two or more different
types of channels for the same basic product.

94
Q

when a retailer owns the manufacturing operation

A

Backward Integration

95
Q

Like personal selling, __________ has the advantage of being customized to match the needs of specific target markets. Messages can be developed and adapted quickly to facilitate one-to-one relationships with customers.

A

direct marketing

96
Q

channel type when the producer and the ultimate consumers deal directly with each other

A

Direct Channel

97
Q

directing the promotional mix at ultimate consumers to encourage them to ask the retailer for a product

A

pull strategy

98
Q

Using competitors or market price as a benchmark

A

Above- At- or Below-Market Pricing

99
Q

You have been asked to calculate the break-even point for a new line of souvenir T-shirts. The selling price will be $25 per shirt. The labor cost is $5 per shirt. The administrative costs of operating the company are estimated to be $60,000 annually and the sales and marketing expenses are $20,000 a year. Additionally, the cost of materials will be $10 per shirt.What is the break-even quantity?

A

8,000 shirts

100
Q

type of channel conflict that occurs between different levels in a marketing channel

A

Vertical Channel Conflict

101
Q

Product Life cycle:

A

introduction
growth
maturity
decline

102
Q

firms products are only carried by one retailer in a specific geographical area

A

Exclusive Distribution

103
Q

Reasons for Product Failure

A
  • Insignificant point of difference
  • Incomplete market and product protocol before product development starts
  • Not satisfying customer needs on critical factors
  • Bad timing
  • No economical access to buyers
  • Poor product quality
  • Poor execution of the marketing mix
  • Too little market attractiveness
104
Q

channel type where an arrangement whereby a firm reaches different buyers by employing two or more different types of channels for the same basic product

A

Dual Distribution

105
Q

Maturity Promotional Activity

A
  • reminder advertising
  • sales promotions: discounts, coupons, events
  • limited personal selling
  • direct mail reminder

MKTG 3700 (2 decks)

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