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MKTG 351 > Exam 3 (Ch 15-20) > Flashcards

Exam 3 (Ch 15-20) Flashcards

1
Q

What is marketing communications?

A

get all promotional mix elements to work together

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2
Q

What is promotion?

A

all communication that informs and persuades buyers

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3
Q

What is a promotional strategy?

A

plan for optimal use of all elements of promotion to elicit a particular response

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4
Q

What is the main focus of a promotional strategy?

A

convince the buyers that the companies’ products offer a competitive advantage, a set of features and benefits over others’ offerings

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5
Q

What are the 5 elements of the promotional mix?

A

-Advertising
-Public Relations
-Sales Promotions
-Personal Selling
-Social Media

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6
Q

What is the difference between advertising and public relations?

A

Advertising: paid and marketers have complete control over message

Public Relations: not paid and media outlets have control over message

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7
Q

T or F:
Sales Promotions include advertising and public relations.

A

False

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8
Q

How do consumers have some control over social media?

A

-control what information they see
-create content they can share with other consumers and marketers

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9
Q

What is integrated marketing communications (IMC)?

A

aligning all elements of the promotional mix to get the best results

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10
Q

What is the point of promotional goals?

A

impress the value their products offer

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11
Q

What are the 3 tasks of marketing communication?

A

-Informing
-Persuading
-Reminding

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12
Q

What is the point of informing?

A

market isnt aware of what the brand has to offer

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13
Q

What is the emphasis on persuading?

A

superiority of their products over competitors in an effort to convince their product is superior

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14
Q

Why remind the customer?

A

make sure brand is in a high priority in their mind

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15
Q

What is connecting?

A

creating ongoing relationships with the customers

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16
Q

What does AIDA stand for?

A

-Attention
-Interest
-Desire
-Action

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17
Q

What is AIDA used for?

A

guide their communication strategy

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18
Q

T or F:
Companies have to follow AIDA in order.

A

True

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19
Q

What is the goal of Attention in AIDA?

A

create awareness

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20
Q

What is the goal of Desire in AIDA?

A

create customer preference

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21
Q

What are the 4 factors that affect promotional mix?

A

-Nature of the Product
-Stages of the Product Life Cycle
-Types of Buying Decisions
-Push and Pull Strategies

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22
Q

What is the difference between the promotional mix for a mass-produced product and a business product?

A

Mass produced: advertising

Business product: personal selling

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23
Q

How do the stages of the product life cycle affect the promotional mix?

A

Early:
-Advertising and public relations → build awareness
-Sales promotion→induce trial
-Personal Selling→obtaining distribution
Growth:
-Advertising and public relations→product’s differential advantage
-Sales promotion can be ↓
Maturity:
-Persuasive and reminder advertising continues
-Sales promotion→increase sales
Decline:
-Advertising ↓ significantly
-Personal selling stays the same

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24
Q

How do the types of buying decisions affect the promotional mix?

A

Simple Decisions/Routine Purchases:
-Reminder advertising effective
-Sales promotions: ↑ sales
High Involvement/Shopping Goods:
-Personal selling helpful
Business Markets:
-early stages: advertising cheaper
-later stages: personal selling

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25
Q

What is the push strategy?

A

force products through channel

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26
Q

What is used in the push strategy?

A

personal selling and trade/sales promotion

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27
Q

What is the pull strategy?

A

appeal to end consumers and they ask retailers for product

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28
Q

What is used in the pull strategy?

A

advertising

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29
Q

T or F:
Push strategy is widely used and is market practice.

A

False

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30
Q

What is advertising?

A

impersonal, one way mass communication paid for by a marketer, to increase sales in the long run

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31
Q

What letter does the advertising response function look like?

A

Letter “S”

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32
Q

T or F:
Companies tend to operate in the zone of high effectiveness in the advertising response function

A

True

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33
Q

What are the two major types of advertising?

A

-Institutional (Corporate)
-Product

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34
Q

What is institutional/corporate advertising?

A

promoting the corporation as a whole

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35
Q

When is institutional/corporate advertising used?

A

-used for parent brand name
-advocacy ad

Advocacy ad is used to promote a positive image or overcome negative perceptions

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36
Q

What is product advertising?

A

promoting individual products

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37
Q

What are the three types of product advertising?

A

-Pioneering
-Competitive
-Comparative

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38
Q

What are the traits of pioneering advertising?

A

-used in early stages of PLC
-focus: explaining benefits

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39
Q

What are the traits of competitive advertising?

A

-used in growth stage
-competitors enter market
-focus: convince customers to buy their own brand

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40
Q

What are the traits of comparative advertising?

A

-comparing them with competitors’ brands
-useful for smaller brands

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41
Q

Why do bigger brands rarely use comparative advertising?

A

they have little to gain from comparing themselves to smaller brands and comparative advertising is illegal in many countries

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42
Q

What are the three ways to set an advertising budget?

A

-% of Sales
-Competitive Parity
-Defining Advertising Goals for Measured Advertising Results (DAGMAR)

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43
Q

What is the % of sales method?

A

companies assign a fixed % of sales to advertising budget

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44
Q

What is the problem with % of sales method?

A

decrease in sales = decrease in advertising budget

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45
Q

What is the competitive parity method?

A

spending at a level comparable to competitors

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46
Q

What is the problem with the competitive parity method?

A

each company has different strategies which have varying emphasis on advertising

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47
Q

What does DAGMAR stand for?

A

-Defining
-Advertising
-Goals
-for Measured
-Advertising
-Results

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48
Q

What is the problem with the DAGMAR method?

A

impractical to define specific goals for advertising to achieve

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49
Q

What are the steps for creating advertisements?

A
  1. Identifying Product Benefits and Attributes
  2. Developing Advertising Appeals
  3. Executing the Message
  4. Post Campaign Evaluation
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50
Q

T or F:
In the first step of creating advertisements, its best to focus on the attributes.

A

False

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51
Q

What is USP?

A

unique selling propostion

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52
Q

Which step for creating advertisements is the USP made?

A

Step 2: Developing Advertising Appeals

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53
Q

T or F:
Advertisement should move consumers through the AIDA stages.

A

True

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54
Q

How do companies evaluate the success of the campaign?

A

compare pre and post campaign standings on the variable of interest and see which is higher

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55
Q

What is media planning?

A

decisions made for selecting media for advertising

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56
Q

What does media planning involve?

A

choice of appropriate media, media mix, and media schedule

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57
Q

What are the six types of media?

A

-Newspaper
-Radio
-Television
-Magazines
-Internet
-Outdoor Advertising

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58
Q

What are the traits of a newspaper?

A

-cheap
-offer geographic selectivity

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59
Q

What are the traits of a radio?

A

-low cost
-highly localized

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60
Q

What are the traits of a television?

A

-high cost and higher impact
-wide coverage
-more engaging
-easier to demonstrate products
-good for nationwide product launches

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61
Q

What are the traits of a magazine?

A

-better reproduction
-high pass along rates
-longer lives for ads
-highly targeted

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62
Q

What are the traits of the internet?

A

-highly customizable options
-ability to monitor performance on a real-time basis

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63
Q

What is media mix?

A

emphasis placed on all media outlets used and the budget allocated to those

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64
Q

What are the five types of criteria for the media mix?

A

-Cost
-Reach
-Frequency
-Audience Selectivity
-Noise Level

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65
Q

What are the three types of costs for advertising?

A

-Cost per contact
-Cost per thousand (CPM)
-Cost per click

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66
Q

What is the cost per contact?

A

cost of reaching each person in the audience

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67
Q

T or F:
Cost per thousand (CPM) is the least used metric

A

False

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68
Q

T or F:
Cost per click is a key metric for online media

A

True

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69
Q

What is reach in terms of the media mix?

A

the amount of people the medium has access to

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70
Q

How is the reach of TV measured?

A

-measured using gross rating points (GRPs)
-GRPs: % of all TV audience at any point of time that is tuned to the specific program

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71
Q

What is frequency in terms of the media mix?

A

number of times an individual is exposed to an advertisement

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72
Q

What is audience selectivity in terms of the media mix?

A

ability to reach target market

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73
Q

What is noise level in terms of the media mix?

A

interference from everything else

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74
Q

What are the four types of media scheduling?

A

-Continuous
-Flighted
-Pulsing
-Seasonal

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75
Q

What are the traits of continuous scheduling?

A

-ads run at a steady pace throughout the campaign
-works well for mature products

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76
Q

What are the traits of flighted scheduling?

A

-ads are run heavily in short bursts
-no advertising between bursts
-concentrated = more communication above noise level and get market’s attention

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77
Q

What are the traits of pulsing scheduling?

A

-continuous schedule at a lower amount combined with heavier advertising bursts
-used by retail stores

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78
Q

What is seasonal scheduling?

A

matches advertising to the seasonality of sales for certain products

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79
Q

What is public relations?

A

aim to impact public attitudes and execute programs to gain understanding and acceptance

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80
Q

What are the five commonly used tools for public relations?

A

-New Product Publicity
-Product Placement
-Consumer Education
-Sponsorships
-Company web sites and social media

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81
Q

What are the traits of new product publicity?

A

-make appealing stories for the press
-effective and used extensively

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82
Q

What are the traits of product placement?

A

-getting the brand to appear in a TV show, movie, radio show, etc as part of the narrative
-main appeal: brands are part of storyline so they will be noticed

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83
Q

What is the difference between zipping and zapping a commercial?

A

Zipping: fast forward the commercials

Zapping: change channels during commercial break

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84
Q

What is the main trait of consumer education?

A

educating consumers may increase sales

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85
Q

What is the main trait of sponsorships?

A

create a strong link between brand and the nature of the event

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86
Q

What are the traits of company websites and social media?

A

-provide ready access to company news
-get favorable stories to target market

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87
Q

What are the traits of sales promotion?

A

-short term orientiation
-intended to induce trail of new products and increase sales of existing products

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88
Q

What is the difference between consumer promotions and trade promotions?

A

Consumer: directed towards consumers

Trade: directed at trade members and channel members (intermediaries)

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89
Q

What are the four types of consumer promotions?

A

-Coupons and Rebates
-Premiums
-Loyalty Programs
-Point of Purchase Promotions

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90
Q

What advantage do rebates give to marketers?

A

half of the people of use rebates don’t complete the paperwork so they don’t get the rebate

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91
Q

What are premiums?

A

extra items offered as incentives for the purchase of the original items

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92
Q

What are loyalty programs?

A

get some reward after purchasing the product several times

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93
Q

What are the three types of trade promotions?

A

-Trade Allowance
-Push/Pull Money
-Training

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94
Q

What is trade allowance?

A

discount given by manufacturers to wholesalers and retailers for doing something specific that helps the manufacturers

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95
Q

What is push/pull money?

A

manufacturers give money because they are emphasizing a push or pull strategy

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96
Q

What is training in terms of trade promotions?

A

train salespeople

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97
Q

T or F:
After training, retail salespeople have no preference over the product.

A

False

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98
Q

What is personal selling?

A

paid for, face to face communication, aimed at informing and influencing the customers to increase company sales

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99
Q

When is it effective to use personal selling?

A

-high transaction value
-fewer customers
-product is complex or customized
-in later stages of purchasing process

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100
Q

What is relationship selling?

A

emphasizes developing relationships with the buyers

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101
Q

T or F:
relationship selling is long-term oriented.

A

True

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102
Q

What is customer relationship management (CRM)?

A

business put customers at the center and manage every contact with them with an intent of understanding their needs, collecting relevant info, and leveraging this data to better serve the customers and increase sales

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103
Q

What are the 4 steps of CRM?

A
  1. Identifying Customer Relationships
  2. Understand Interactions With Current Customers
  3. Capture Customer Data
  4. Leverage Customer Information
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104
Q

What happens in the 1st step of CRM?

A

develop their companies’ responses around the needs and wants of their customers

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105
Q

What is learning under step 1 of CRM?

A

collecting good data on customers

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106
Q

What happens in the 2nd step of CRM?

A

identify all situations where customers can interact with the company

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107
Q

What are touchpoints?

A

-personal and online interactions
-exposure to advertising
-point of sale

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108
Q

What happens in the 3rd step of CRM?

A

have a data collection plan that starts when the customer makes any interactions and continues with all ongoing interactions

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109
Q

What is knowledge management?

A

create a centralized database that can be shared by everyone

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110
Q

What happens in the 4th step of CRM?

A

data mining is used to identify trends and relationships between different marketing variables, customers’ behaviors, and sales

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111
Q

What are some uses of data?

A

-Campaign Management
-Get and Maintain Customers
-Cross-sell other products and services
-Targeted communication about their products and services

112
Q

What is campaign management?

A

using interaction data to create effective communication campaigns

113
Q

How do companies use data to get and maintain customers?

A

studying their preferences and rewarding them for multiple purchases or support over a longer duration

114
Q

What are the 7 steps in the sales process/cycle?

A
  1. Generating Leads
  2. Qualifying Leads
  3. Approaching the Customers
  4. Developing and Proposing
  5. Handle Objections
  6. Close the Sale
  7. Follow Up
115
Q

What happens in the 1st step in the sales process?

A

creating a list of prospects who may have an interest in purchasing the products

116
Q

What is another name for the first step in the sales process?

A

Prospecting

117
Q

How do you create the list of prospects?

A

-Cold calling (unwanted calls to people) from a list
-referrals from customers or business associates
-networking with business professionals

118
Q

T or F:
Cold calling is better than referrals.

A

False

119
Q

What happens in the 2nd step in the sales process?

A

assessing the prospects’ needs, their buying power, and receptivity towards the company’s products

120
Q

How do they assess the prospects’ needs in 2nd step of the sales process?

A

cold calling and telemarketing

121
Q

What happens in the 3rd step in the sales process?

A

approaching the customers and asking for their needs

122
Q

What is pre approach?

A

groundwork salespeople need to cover before approaching the customers

123
Q

What happens in the 4th step in the sales process?

A

prepare sales proposals

124
Q

What is a sales proposal?

A

formal documents that outline how the company will deliver and the accompanying terms

125
Q

How is the sales proposal done?

A

written report or sales presentation

126
Q

What is the goal of the sales proposal?

A

impress on the buyers the value of their offerings

127
Q

What happens in the 5th step in the sales process?

A

buyers may have concerns or questions about proposals

128
Q

How should objections be seen?

A

opportunities to clarify their offer

129
Q

What happens in the 6th step in the sales process?

A

proactively closing the deal

130
Q

What happens in the 7th step in the sales process?

A

ensure products and services are being delivered as per the terms and to the satisfaction of their buyers

131
Q

T or F:
Following up has a higher chance for repeat business.

A

True

132
Q

What are the five responsibilities of sales managers?

A
  1. Defining sales goals
  2. Determining sales force structure
  3. Recruiting and training the sales force
  4. Compensating and motivating the sales force
  5. Evaluating the sales force
133
Q

What are the traits of sales goals?

A

-clear, precise, and measurable
-combination of revenues and profit margins that need to be generated
-divided among members of the sales force

134
Q

What is a quota?

A

amount a salesperson is expected to sell in a given timeframe

135
Q

How can the sales force structure be determined?

A

-geographical lines
-product line
-industries their customers belong to
-size and type of customers

136
Q

What is the general rule for determining the sales force structure?

A

the factor that has more variation is worth defining the sales force structure to

137
Q

Why should companies put extra effort into choosing and training the right people?

A

-sales performance is clear in a short period of time
-sales people have very high turnover

138
Q

Why should companies compensate their salespeople?

A

retain successful salespeople and keep them motivated

139
Q

What types of compensation are there?

A

Fixed: provide financial security
Commissions: reward strong performance

140
Q

What are the factors of compensation?

A

-revenue generated
-profit margin those sales bring
-buyers satisfaction

141
Q

T or F:
Salespeople are encouraged to heavily discount their prices.

A

False

142
Q

What does evaluating the sales force show?

A

show weak areas of their performace

143
Q

How do companies evaluate the sales force?

A

identifying the weaknesses at each step of the sales cycle

144
Q

What is social media?

A

Internet-based services that facilitate conversations and social interactions

145
Q

What is social media’s main feature?

A

user-generated content

146
Q

T or F:
Social media was not created for marketing.

A

True

147
Q

What is crowdsourcing?

A

create and improve marketing initiatives

148
Q

How do marketers use social media?

A

-listen and communicate with the customers
-create and improve marketing initiatives (crowdsourcing)

149
Q

How does social media help with marketing?

A

-consumers can interact more directly with brands
-brands get more information to use and sort
-consumers get content that is custom-delivered to them

150
Q

What is engagement in terms of social media?

A

amount of time users spend on social media platforms

151
Q

Why does social media have a major privacy rights concern?

A

social media is selling users data to marketers

data includes browsing history, purchase behavior, and demographic/psychographic profiles

152
Q

What opportunities do social media give marketers?

A

-listen and learn about their brands and companies
-build relationships with customers by engaging in conversations
-promote their products and services
-manage their reputation by addressing customers’ and stakeholders’ concerns

153
Q

What are the three types of communication on social media for marketers?

A

-Paid
-Owned
-Earned

154
Q

What is earned communication?

A

coverage that is earned through word of mouth or online buzz

155
Q

T or F:
Social media offers an ability to build brand image on only one platform.

A

False

156
Q

What are the disadvantages of social media for marketers?

A

-more noise for customers
-dedicated resources and effort to keep audience engaged and respond to their concerns

157
Q

What are three strategies for crowded social media?

A

-Content Marketing
-Influencer Marketing
-Social Listening Systems

158
Q

What is content marketing?

A

marketers use their platforms not just to sell their products but also to distribute content their customers may find valuable

159
Q

What is influencer marketing?

A

companies pay influencers to promote products to their social media followers

160
Q

T or F:
Ads by influencers are more credible than paid ads.

A

True

161
Q

What are Social Listening Systems?

A

allow them to automatically access what people are saying about the brand across platforms

162
Q

What is text mining?

A

form of big data analysis where a large quantity of text is automatically analyzed

163
Q

What results come out of text mining?

A

-Sentiment Analysis: how positive or negative people tend to be when they discuss the brand
-Share of Voice: how often the brand is mentioned compared to other competitor brands

164
Q

What are the five types of performance metrics?

A

-Reach
-Engagement
-Acquisition
-Conversion
-Retention

165
Q

What are reach metrics?

A

how many people see posts related to the brand

166
Q

What is an audience in terms of performance metrics?

A

total number of people within a brand’s social media

167
Q

What rate is related to reach metrics?

A

audience growth rate: how many people are added or lost over a certain period

168
Q

What are engagement metrics?

A

how many people on a platform interact with posts related to the brand

169
Q

What rates are related to engagement metrics?

A

engagement rate: % of the audience that has interacted with a brand’s content

amplification rate: average number of shares per post within a specific period

170
Q

What are acquisition metrics?

A

how many people visit a link posted within the content related to a brand

171
Q

What rates are related to acquisition metrics?

A

click through rate: % of audience members clicking on a post

bounce rate: % of visitors who return to the source site or platform without clicking on the linked site

172
Q

What are conversion metrics?

A

transition from seeing the brand content to purchasing it

173
Q

What rates are related to conversion metrics?

A

conversion rate: % of people seeing an ad who make a purchase

cost per conversion: total amount spent divided by number of conversions

174
Q

What are retention metrics?

A

how many people stay loyal to the brand

175
Q

What rates are related to retention metrics?

A

churn rate: % of audience members who leave within a certain time

band advocacy rate: % of audience members who recommend the product or service to others

176
Q

What is search engine optimization (SEO)?

A

process of trying to get higher rankings in search engines so that when customers search for words related to a brand, that brand is more likely to appear first

177
Q

What is search engine marketing (SEM)?

A

practice of paying search engines to display ads for a brand towards the top of a search

178
Q

What are the five main concerns about social media?

A

-privacy
-microtargeting
-undisclosed advertising
-content driven by algorithms
-mental health

179
Q

Why are there privacy concerns?

A

users are unaware of what data is being collected on them

180
Q

What is the privacy paradox?

A

users say they are concerned about their privacy but do very little to protect their data

181
Q

What is microtargeting?

A

social media data is used to send ads to highly focused groups of people

182
Q

Why is microtargeting concerning?

A

Transparency concerns

-users are unaware of why they are being served specific ads
-uses information about users’ identities to target them
-can lead to purchasing behavior not in the best interest of the consumer

183
Q

What is undisclosed advertising?

A

influencers dont say that they are being paid to promote a product or service

184
Q

T or F:
Undisclosed advertising is encouraged and gives a sense of trust to potential customers.

A

False

185
Q

What are native ads?

A

ads made to look like regular content

186
Q

What is content driven by algorithms?

A

using algorithms to deliver content to users

187
Q

Why is using algorithms to drive content concerning?

A

using psychology to keep users engaged

188
Q

Why is mental health a concern for social media?

A

can negatively impact mental health especially among younger users

189
Q

What is price?

A

amount given up in an exchange to acquire a good or service

190
Q

What is a company’s top line and bottom line?

A

Top: Sales
Bottom: Profits

191
Q

What is sacrifice in terms of value?

A

amount buyers pay for something

192
Q

What is reward in terms of value?

A

what buyers get in return

193
Q

How do you calculate value?

A

Value = Reward - Sacrifice

194
Q

How do you calculate revenue (sales)?

A

Revenue (Sales) = Price x Num of Units Sold

195
Q

How do you calculate profits?

A

Profits = Revenue - Costs

196
Q

How do you calculate the contribution margin?

A

Contribution Margin = Price - Variable Cost

197
Q

What are the 4 types of cost?

A

-Variable
-Fixed
-Average
-Marginal

198
Q

If the output increases, what happens to total variable cost?

A

increases

199
Q

If the output increases, what happens to fixed cost per unit?

A

decreases

200
Q

If the output increases, what happens to average total cost?

A

decreases

201
Q

What is the difference between marginal cost and revenue?

A

Marginal Cost: cost of producing an additional unit

Marginal Revenue: revenue created from the sale of an additional unit

202
Q

T or F:
Costs serve as a floor for pricing.

A

True

203
Q

What are the four types of pricing?

A

-Profit Oriented
-Sales Oriented
-Status Quo
-Value Based

204
Q

What are the four types of profit oriented pricing?

A

-Profit Maximization
-Breakeven Pricing
-Targeted Return on Investment
-Markup Pricing

205
Q

What is profit maximization?

A

setting prices so that profits are maximized

206
Q

What is breakeven pricing?

A

focus on breaking even

breaking even: no profits or losses are made

207
Q

What is targeted return on investment?

A

creating enough profits to justify a certain return on investment

208
Q

How do you calculate return on investment (ROI)?

A

Net Profit After Taxes / Total Investment

209
Q

What is markup pricing?

A

costs plus markup on that as profits

210
Q

What does mean for a price to be sales oriented?

A

maximizes sales or market share

211
Q

What is the goal of sales oriented pricing?

A

set a price that will give the largest sales and market share in the long run

212
Q

T or F:
Its always effective to use sales oriented pricing.

A

False

213
Q

What is status quo pricing?

A

maintain a balance with competitors’ pricing and follow the price set by market leaders

214
Q

What is value based pricing?

A

based on what customers perceive as the fair value of the product

215
Q

How do you calculate elasticity of demand?

A

Change in Demand / Unit Change in Price

216
Q

What is elasticity of demand also known as?

A

buyers’ sensitivity to price

217
Q

What are the three types of elasticity?

A

-High Price
-Low Price
-Unitary

218
Q

What does it mean when a product has a high price elasticity?

A

small changes in price, huge change on demand

219
Q

What does it mean when a product has a low price elasticity (inelasticity)?

A

changes in price doesnt change demand much

220
Q

What does it mean when a product has unitary elasticity?

A

-elasticity value of 1
-change in demand = change in price

221
Q

What are the factors affecting elasticity?

A

-Availability of substitutes
-price relative to purchasing power
-ease of evaluating quality
-use of prestige pricing

222
Q

What is prestige pricing?

A

the perception that a higher price means higher quality

223
Q

What are the four types of market structures?

A

-Pure monopoly
-Pure competition
-Oligopoly
-Monopolistic competition

224
Q

What are the traits of pure monopoly?

A

-only one seller
-can charge any price
-bad for consumer
-illegal in most places

225
Q

What are the traits of pure competition?

A

-many sellers
-no product differentiation
-price determined by market

226
Q

What are the traits of oligopoly?

A

-few sellers
-little differentiation between products

227
Q

What is a special type of oligopoly?

A

Duopoly

228
Q

What is a duopoly?

A

only has two sellers

229
Q

What are the traits of monopolistic competition?

A

-highly differentiated products
-charge prices that can be justified based on differentiation

230
Q

What are the two types of market entry pricing?

A

-Price Skimming
-Penetration Pricing

231
Q

How does price skimming work?

A

Starts with a high price and lowers the price after an amount of buyers. It can repeat a few times

232
Q

T or F:
Price skimming is good for durables.

A

True

233
Q

How does penetration pricing work?

A

lowering the initial price significantly

234
Q

What is the goal of price modification?

A

maximize sales or profitability while addressing their customers’ wants and taking into consideration their purchasing power

235
Q

Why do companies use discounts?

A

a way of modifying price without making a permanent change to the base price

236
Q

What are the five types of discounts?

A

-Quantity
-Cash
-Seasonal
-Promotional (Trade) Allowance
-Rebate

237
Q

What is a quantity discount?

A

discount buyers receive when they buy multiple units

238
Q

What is a cash discount?

A

provided to buyers to encourage prompt payments

239
Q

T or F:
Cash discounts is used for all customers

A

False

240
Q

What is a seasonal discount?

A

decrease price in off seasons

241
Q

What is a promotional (trade) allowance?

A

payments made to channel members for performing certain actions

242
Q

What is a rebate?

A

cash refund for purchasing a product during a specified period

243
Q

What are the three types of geographical pricing?

A

-Free on Board (FOB)
-Uniformed Delivered Price
-Zonal

244
Q

What is Free on Board (FOB)?

A

buyers pay freight charges depending the distance from origin

245
Q

What is Uniformed Delivered Price?

A

everyone pays the same price at delivery

246
Q

What is Zonal Pricing?

A

market is divided into geographical zones and each zone has a different price

247
Q

What are five common types of pricing?

A

-Loss Leader Pricing
-Psychological
-Two Part Pricing
-Price Bundling
-Versioning

248
Q

What are the three main legal issues in pricing?

A

-Price Fixing
-Price Discrimination
-Predatory Pricing

249
Q

Out of the three main legal issues, which one isn’t hard to prove?

A

Price Fixing

250
Q

T or F:
The legal issues are illegal because they are meant to protect the customers

A

True

251
Q

What is the breakeven point?

A

level of sales at which total revenue equals total costs

252
Q

T or F:
If the breakeven is unrealistic, the only way to fix it is to change the price.

A

False

253
Q

How do you calculate contribution margin per unit?

A

Unit Sale Price - Unit Variable Price

254
Q

How do you calculate breakeven volume?

A

Total fixed costs / contribution margin per unit

255
Q

How do you calculate breakeven revenue?

A

Breakeven volume x Selling Price per unit

256
Q

How do you calculate breakeven market share in units?

A

Breakeven volume / Size of the market in units

257
Q

How do you calculate breakeven market share in dollars?

A

Breakeven Revenue / Size of the market in $

258
Q

What is customer lifetime value (CLV)?

A

how much profit a firm expects to make from a single customer throughout the duration of the relationship with the customer

259
Q

How do calculate CLV?

A

Net present value of all future earnings - Customer acquisition cost

260
Q

T or F:
the customer acquisition cost is the highest a firm is willing to spend to gain a customer.

A

True

261
Q

What do non finanical measures show about the brand?

A

shows how brand is currentlly performing and how it can be improved in the future

262
Q

What is brand loyalty?

A

strong commitment to repurchase a specific brand despite changes in marketplace that may otherwise result in brand switching

263
Q

Why do brands with large market share spend proportionally less on advertising than smaller brands?

A. They cannot afford to spend more
B. Advertising is not effective for them
C. They need to spend proportionally less to get the same advertising effectiveness
D. Firms with large market share do not need to advertise much

A

C. They need to spend proportionally less to get the same
advertising effectiveness

264
Q

A new company with a new product will use ____________ advertising to promote its products.

A. Pioneering
B. Competitive
C. Comparative
D. Demonstration

A

A. Pioneering

265
Q

Without naming a competitor, an advertisement boasts that it’s the best product. This is a(n) __________ advertisement.

A. Pioneering
B. Competitive
C. Comparative
D. Demonstration

A

B. Competitive

266
Q

Which type of ad is suited for smaller competitors to move aggressively against bigger rivals?

A. Pioneering
B. Competitive
C. Comparative
D. Demonstration

A

C. Comparative

267
Q

The way the advertisement message is conveyed is called

A. Identifying product benefits
B. Evaluating the appeal of competing advertisements
C. Message execution
D. Campaign evaluation

A

C. Message execution

268
Q

Ad executional style that shows group of women chatting on a sofa is called

A. Demonstration
B. Slice of Life
C. Humor
D. Testimonial

A

B. Slice of Life

269
Q

____ is the number of times the target viewer is expected to view an advertisement

A. Reach
B. Frequency
C. Impact
D. Audience Selectivity

A

B. Frequency

270
Q

A(n) ______ media schedule combines continuous scheduling with a flighted schedule during best sales periods

A. Pulsing
B. Periodic
C. Flighted
D. Bursting

A

A. Pulsing

271
Q

If a company wants to build its long term brand image, it should not focus on ________

A. Sales Promotion
B. Press Releases
C. Advertising
D. Publicity

A

A. Sales Promotion

272
Q

What is the benefit of rebates over price reductions from perspective of marketer?

A. Rebates entice purchases but many consumers never bother to redeem them
B. Consumers find rebates more appealing
C. Rebates are more convenient for consumers
D. Rebates result in brand-loyal consumers

A

A. Rebates entice purchases but many consumers never bother to redeem them

273
Q

T or F:
Using consumers to develop and market products is called crowdfunding.

A

False

274
Q

Which is an example of earned media for BodyFit - a fitness center?

A. The display ad that BodyFit purchased on the local newspaper’s website
B. The Facebook page created by BodyFit to let members of events at the gym
C. The tweet that a member sent about how much weight she lost working out
D. The personal blog maintained by a member of BodyFit

A

C. The tweet that a member sent about how much weight she lost working out

275
Q

T or F:
A website that allows individuals to connect with friends, peers and business associates is called a virtual world.

A

False

MKTG 351 (3 decks)

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