EXAM International Marketing

Question 1

3 important characteristics of intangibility

Answer 1

inseparable, heterogenous, perishable

Question 2

Two types of quality

Answer 2

Market perceived quality (consumer perceptions) & performance quality (firm’s perception)

Question 3

Product Homologation

Answer 3

Changes mandated by local product and service standards

Question 4

Bundle of satisfactions or utilities a buyer receives

Answer 4

Sum of physical and psychological satisfactions and cultural influences

Question 5

Innovation

Answer 5

Perceived newness of product in intended market

Question 6

Diffusion according to to Everett Rogers

Answer 6

An innovation communicated through certain channels over time among members of a social system

Question 7

Five characteristics of innovation bias

Answer 7

1. relative advantage
2. compatibility
3. complexity
4. trialability
5. observability

Question 8

Product component model

Answer 8

Helps determine how product might be adapted to market . Separates many dimensions into 3 distinct components:
support services, core component, packaging.

Question 9

Core component

Answer 9

-product platform
-design features
-functional features

Question 10

Packaging component

Answer 10

-price
-quality
-package
-styling
-trademark
-brand name

Question 11

Support services component

Answer 11

-repair and maintenance
-deliveries
-warranty
-spare parts
-installation
-instructions
-other related service

Question 12

Barriers to entering global markets

Answer 12

1. protectionism
2. restrictions to trans-border data flow
3. protection of intellectual property
4. cultural barriers and adaptation

Question 13

Global brand

Answer 13

Worldwide use of name, term, sign, symbol, design. Used to identify goods and services of one seller

Question 14

National brand

Answer 14

Country-specific brand.

Question 15

Country-of-origin effect (COE)

Answer 15

Influence that country of manufacture, assembly or design has on consumer’s perception of product.

Question 16

Private brand

Answer 16

Formidable competitors to manufacturers’ brands. Consumers prefer less expensive “more local” private brands.

Question 17

The distribution process

Answer 17

Physical handling and distribution of goods, passage of ownership/title, and buying/selling negotiations between producer & intermediaries, intermediaries & customers.

Question 18

Import-oriented distribution structure

Answer 18

Limited supply sold at high price to small group of customers, demand exceeds supply.

Question 19

Direct selling

Answer 19

often used in markets with underdeveloped distribution systems

Question 20

Channel process

Answer 20

includes all activities from manufacturer to consumer

Question 21

Seller must exert influence over two sets of channels

Answer 21

1. channels in home-country
2. channels in foreign-market country

Question 22

Agent intermediaries

Answer 22

Do not take title to merchandise. Manufacturer assumes all trading risk but can establish policy guidelines and prices.

Question 23

Merchant intermediaries

Answer 23

Take title to merchandise and assume all trading risks. Primary concern is profit, don’t always have manufacturer’s best interest in mind.

Question 24

Six C’s of channel strategy

Answer 24

1. cost
2. capital requirements
3. control
4. coverage
5. character
6. continuity

Question 25

Two kinds of channel cost

Answer 25

1. capital or investment cost of developing channel
2. continuing cost of maintaining channel

Question 26

Logistics management

Answer 26

Total systems approach to managing distribution process.

Question 27

Variables impacting price

Answer 27

tariffs
costs
competition
currency fluctuations
bitcoin

Question 28

Pricing activity is affected by:

Answer 28

-country in which business is being conducted
-type of product
-competitive conditions
-tax rates in home vs subsidiary countries

Question 29

Pricing decision as active instrument to accomplish market objectives

Answer 29

company sets price rather than following market prices to achieve objectives (ROP, sales volume etc.)

Question 30

Pricing decisions as a static business element

Answer 30

views exports as passive contribution to sales volume and only exports excess inventory. Places low priority on foreign business

Question 31

Parallel imports

Answer 31

Firms charge different prices per country.

Question 32

Exclusive distrubution

Answer 32

Company restricts which retailers can carry a product

Question 33

Skimming Pricing

Answer 33

Used to reach segment of market that is price insensitive and willing to pay a premium price.

Question 34

Penetration pricing

Answer 34

Deliberately offering products at low price. Competitive maneuver to capture market share.

Question 35

Price escalation

Answer 35

costs of exporting are key cause of price escalation (higher cost of product in foreign market than domestic market)

Question 36

Approaches to reducing price escalation

Answer 36

lowering cost of goods (lower labour costs etc.), lowering tariffs (classifications), lowering distribution costs (shorter channels), use foreign trade zones, dumping

Question 37

Dumping

Answer 37

Selling at a price below cost of production or selling in foreign market below price of same goods in home market

Question 38

Countertrade

Answer 38

Barter

Question 39

Cartels

Answer 39

Companies producing similar products working together to control markets for goods and services they produce.