Deck 11: Marketing Channels

Question 1

Long-term partnerships among channel members working together to reduce inefficiencies, costs, and redundancies in the entire marketing channel is called:

A) supply chain management.
B) vertical channel integration.
C) industrial management.
D) industrial distribution.
E) marketing management.

Answer 1

A

Question 2

The marketing channel of producer to retailer to consumer is most likely to be used by producers of which of the following products?

A) Chewing gum
B) Tobacco
C) Automobiles
D) Hardware
E) Saltine crackers

Answer 2

C

Question 3

What are the four types of utility that marketing channels create, and what do they involve?

Answer 3

Marketing channels create four types of utility: Time utility is having products available when the customer wants them. Place utility is created by making products available in locations where customers wish to purchase them. Possession utility is created by giving the customer access to the product to use or to store for future use. Possession utility can occur through ownership or through arrangements such as lease or rental agreements that give the customer the right to use the product. Channel members sometimes create form utility by assembling, preparing or otherwise refining the product to suit individual customer needs. Marketing channels serve many functions. Although some of these functions may be performed by a single channel member, most are accomplished through both the independent and joint efforts of channel members. These functions include creating utility, facilitating exchange efficiencies, alleviating discrepancies, standardizing transactions and providing customer service.

Question 4

Marketing channels create three types of utility for consumers including:

A) place, time, and possession.
B) location, availability, and suitability.
C) time, location, and promotion.
D) retailer, wholesaler, and producer.
E) position, possession, and place.

Question 5

An independent business that takes title to products and carries inventories is a(n):

A) industrial distributor.
B) intermediary.
C) agency.
D) wholesaler.
E) producer.

Question 6

All members of the supply chain should determine their position in the chain, identify their partners and their roles, and establish partnerships whose focus is:

A) shifting costs to suppliers.
B) maximizing costs.
C) maximizing technology implementation.
D) cooperation with competitors.
E) customer relationships.

Question 7

Manufacturers of convenience products such as chewing gum reach customers through thousands of retailers. What marketing channel are these manufacturers most likely to use?

A) Producer, consumer
B) Producer, wholesaler, retailer, consumer
C) Producer, wholesaler, agent, retailer, consumer
D) Producer, retailer, consumer
E) Retailer, consumer

Question 8

Under what circumstances is selective distribution a desirable level of market coverage?

Question 9

What links producers to consumers through the purchase and reselling of products or contractual agreements?

A) Marketing intermediaries
B) Distributors
C) Suppliers
D) Middle marketers
E) Marketing channels

Question 10

The supply chain includes:

A) producers, wholesalers, and retailers.
B) suppliers, producers, intermediaries, and customers.
C) suppliers and suppliers' suppliers.
D) all entities that facilitate product distribution.
E) buyers, seller, marketing intermediaries, and agents.

Question 11

Discuss the advantages and disadvantages of channel integration. Who benefits from channel integration?

Question 12

Organizational buyers are especially partial to direct marketing channels when:

A) they buy cheap materials in large quantities.
B) they try a new product for the first time.
C) they are filling an order for a very important customer.
D) a modified rebuy type of decision is involved.
E) expensive and/or complex equipment is involved.

Question 13

Channel decisions are important to marketers mostly because:

A) they are relatively flexible to change quickly.
B) consumers value reasonable prices delivered through marketing channels.
C) they dictate what promotional strategies companies should use.
D) many businesses are marketing intermediaries.
E) they involve long-term commitments and affect customer accessibility.

Question 14

How do marketing channel decisions influence the rest of the marketing mix?

Question 15

What is a marketing intermediary, and what are the activities that marketing intermediaries perform?

Question 16

What is supply chain management? How can it help marketing channel members?

Question 17

Eliminating a wholesaler from a marketing channel will:

A) cut costs and lower prices.
B) not eliminate the functions performed by that wholesaler.
C) eliminate the functions performed by that wholesaler.
D) lead to lower costs but higher prices.
E) reduce channel conflict.

Question 18

What advantages do industrial distributors offer? What are some of the disadvantages of using industrial distributors?

Question 19

Consumers receive the benefits of place utility when:

A) they have to travel excessively to obtain products they want.
B) retailers remain open 24 hours a day.
C) they can stock up on products they need but not use them right away.
D) they make purchases with credit and debit cards.
E) products are available in locations where consumers want to buy them.

Question 20

Discuss channel conflict. How might each one affect distribution channel functions?

Question 21

Few supermarkets would try to replace a national brand of baby food with their own brand. Assuming that this is true, we have a good example of channel leadership by:

A) wholesalers.
B) producers.
C) retailers.
D) agents.
E) brokers.

Question 22

Marketing channel members are likely to experience misunderstandings, frustration, and poorly coordinated strategies as a result of:

A) channel conflict caused by inefficient communication between channel members.
B) open communication among the channel members.
C) methods of channel coordination designed to reduce ambiguity.
D) negotiating territorial issues among regional distributors of a product.
E) allowing one member of the channel to take the role of channel captain.

Question 23

If a wholesaler continually emphasizes and promotes one company's products over a competing company's products, ____ is likely to result.

A) channel cooperation
B) vertical channel integration
C) channel conflict
D) horizontal channel integration
E) channel leadership.

Question 24

Many companies use more than one marketing channel to distribute their products to the same target market, a tactic called:

A) multiple channeling.
B) strategic channel alliance.
C) intensive distribution.
D) dual distribution.
E) market splitting.

Question 25

Distribution decisions have little influence on the rest of the marketing mix.

Question 26

Supply chains start with the producer.

Question 27

When channel members are linked by legal agreements that specify each member's rights and responsibilities, ____ exists.

A) horizontal channel integration
B) an administered VMS
C) a corporate VMS
D) a channel captain
E) a contractual VMS

Question 28

In an administered VMS, informal coordination brings about a high level of interorganizational management. Nonetheless,

A) decision making does not take into account the goals of the system.
B) the channel members do not remain autonomous.
C) the decision making is not coordinated.
D) the channel members remain autonomous.
E) the goals of the individual firms are not congruent with the goals of the system.

Question 29

Middlemen bridge the gap between suppliers (or producers) and buyers (or consumers).

Question 30

Supply chain management includes only producers, wholesalers, retailers, and customers.

Question 31

Buyers' behavior is unimportant to channel members.

Question 32

Using only some of the available outlets to distribute a product is called:

A) selective distribution.
B) intensive distribution.
C) channel conflict.
D) vertical channel integration.
E) exclusive distribution.

Question 33

Marketing intermediaries never establish pricing policies and terms of sale.

Question 34

When a single channel member manages an integrated marketing channel to achieve low-cost, efficient distribution for satisfying target markets, ____ exists.

A) a vertical marketing system
B) horizontal channel integration
C) channel power
D) channel cooperation
E) extensive distribution

Question 35

An arrangement where a producer forbids an intermediary to carry products made by competing manufacturers is called:

A) exclusive distribution.
B) a tying agreement.
C) refusal to deal.
D) contractual VMS.
E) exclusive dealing.

Question 36

Supply chain management combines two or more stages of the marketing channel under one management.

Question 37

The reasons a vertically integrated channel can be more effective against competition is because of all of the following except:

A) the consolidation of power.
B) tightly controlled and bureaucratic management style.
C) the ability to inhibit competitors.
D) the sharing of responsibilities and information.
E) increased bargaining power.

Question 38

Select the greatest advantage of horizontal channel integration.

A) The flexibility of the channel is decreased.
B) The markets are more heterogeneous.
C) The expanded number of units is coordinated.
D) Efficiencies in advertising, marketing research, and purchasing are increased.
E) Planning and research are increased to cope with increased competition.

Question 39

Vertical channel integration:

A) results in two or more different management teams for each member of the channel.
B) is made possible when a large corporation divests itself of smaller subsidiaries.
C) is a shift back to the conventional channel of distribution.
D) combines institutions at the same level of operation.
E) is made possible by purchasing the operations of a link in the channel.

Question 40

Which of the following is least likely to be a factor affecting the selection of marketing channels?

A) Customer characteristics
B) Product attributes
C) Product packaging
D) Competition
E) Environmental forces

Question 41

Dual distribution involves the use of two or more marketing channels for distributing the same products to the same target market.

Question 42

Specialty products that require service information and are consumed over a long period of time are likely to be distributed on an exclusive basis.

Question 43

Business buyers prefer to deal with producers through intermediaries and thus eliminate much of the burden of sorting out details.

Question 44

The services or responsibilities provided by some intermediaries can be eliminated effectively without causing an increase in the services or responsibilities provided by other middlemen.

Question 45

Selective distribution is desirable when customer service from a channel member is important.

Question 46

Marketing channels create several types of utility including time, place, possession, and sometimes form utility.

Question 47

Middlemen can reduce the cost of exchanges.

Question 48

Retailers are frequently found in business product channels.

Question 49

Place utility is created by the customer having access to the product to use or store for future use.

Question 50

The end result of eliminating intermediaries is a cost benefit.

Question 51

Channel conflict is necessary to facilitate efficient performance within the channel.

Question 52

Long-term commitments usually characterize the relationships among channel members.

Question 53

Small firms are more likely to be in a position to have more distribution centers that may reduce delivery times to customers.

Question 54

Firms that desire to convey an exclusive image for their products may wish to limit the number of outlets available.

Question 55

Both a manufacturers' agent and an industrial distributor may be used when the organizational marketer wishes to cover a larger geographic area but does not maintain a sales force.

Question 56

It is usually easier to change marketing channels than to change prices or promotion.

Question 57

Some marketing channels are organized and controlled by a single leader.

Question 58

Sometimes a marketing channel is quite simple and short, perhaps running directly from a producer to the final user or consumer.