Question 1

When shopping for tires for your automobile, you notice that the manufacturer you have selected has tires for your car priced low, average, and high, based upon performance and features. This is an example of what type of product-mix pricing?
A) two-part pricing
B) product-line pricing
C) captive product pricing
D) market pricing skimming
E) price discrimination

Accepted Answer

This is an example of product-line pricing, where different prices are set for different products within a product line based on their performance and features.

Question 2

Price-setting logic must be modified when the product is part of a product mix. In that case, the firm searches for a set of prices that ________ profits on the total mix.
A) are ineffective on total
B) have no effect on total
C) maximizes
D) minimizes
E) capitalize upon

Accepted Answer

When a product is part of a product mix, the firm needs to consider the impact of its price on the profit of the entire mix. Therefore, the goal is to find a set of prices that maximizes the profit on the total mix.

Question 3

In ________, the seller offers goods both individually and in bundles and often charges less for the "bundle" than for the individual products.
A) pirating pricing
B) captive pricing
C) two-part pricing
D) pure bundling
E) mixed bundling

Accepted Answer

Mixed bundling is the strategy where the seller offers goods both individually and in bundles, and sometimes offers a discount for the bundle. This allows the seller to capture different types of customers: those who only want one product and those who want multiple products.

Question 4

________ are formal statements of expected product performance by the manufacturer.
A) Insurance
B) Warranties
C) Bonds
D) Invoices
E) Balance sheets

Accepted Answer

Warranties are formal statements by the manufacturer that guarantee the expected performance of the product. They incorporate terms and conditions that specify the circumstances under which the manufacturer will replace or repair the product if it fails to meet the stated performance criteria.

Question 5

Guarantees are most effective in two situations. The first is when the company or products are not well known and the second is when the product's quality is ________ to competition.
A) not known
B) different
C) inferior
D) equivalent
E) superior

Accepted Answer

The answer of Guarantees are most effective in two situations....

Question 6

We define packaging as all the activities of designing and producing the container for a product. This includes up to three levels of material: primary package, secondary package, and ________.
A) retailer package
B) design package
C) shipping package
D) consumer package
E) supplier package

Accepted Answer

The third level of material in packaging is usually known as the shipping package, which is used to transport the primary and secondary packages from the manufacturer to the distributor or retailer. The other options (retailer package, design package, consumer package, and supplier package) do not accurately describe the third level of packaging.

Question 7

Betty Crocker cake mixes using Hershey syrup in its cake mixes and "Lunchables" lunch combinations with Taco Bell tacos are examples of what special type of branding?
A) family branding
B) ingredient co-branding
C) co-branding
D) generic-branding
E) individual branding

Accepted Answer

The use of Hershey syrup in Betty Crocker cake mixes and the combination of Taco Bell tacos in Lunchables lunch combinations are examples of ingredient co-branding, where two different brands come together to create a new product.

Question 8

Which of the following factors is one of the contributors to the growing use of packaging as a marketing tool?
A) consumption aid
B) consumer affluence
C) consumer influence
D) conformance qualities
E) brand identification

Accepted Answer

Consumer affluence, or the increase in consumers' purchasing power, has led to a greater ability and willingness to pay for more elaborate and visually appealing packaging. As a result, packaging has become an important tool for marketers to differentiate their products and capture the attention of consumers.

Question 9

Companies normally develop ________ rather than single products and require sellers to establish perceived quality differences between price steps within it.
A) product mix
B) captive products
C) product lines
D) optional products
E) average products

Accepted Answer

A product line is a group of related products produced by a company. Companies tend to focus on developing a range of products within a particular product line to cater to different customer needs and preferences. Within a product line, companies often price products at different levels based on perceived quality differences. Therefore, the development of a product line requires sellers to establish perceived quality differences between price steps within it.

Question 10

________ is a special case of co-branding involving creating brand equity for materials, components, or parts that are necessarily contained within other branded products.
A) Cross-branding
B) Ingredient branding
C) Equity branding
D) Family branding
E) Generic branding

Accepted Answer

Ingredient branding involves creating brand equity for materials, components, or parts that are necessarily contained within other branded products. This allows the ingredient brand to establish its own reputation and enhance the overall value of the final product.

Question 11

Many sellers offer either general or specific guarantees. Guarantees reduce the buyer's ________ risk.
A) actual
B) perceived
C) real
D) implied
E) stated

Accepted Answer

Guarantees reduce the buyer's perceived risk, which is the worry or fear that the buyer may have about making a purchase. It is not the actual risk, real risk, implied risk, or stated risk that is reduced.

Question 12

Marketing planning begins with formulating an offering to meet target customers' needs or wants.

Accepted Answer

Marketing planning involves identifying a target market and creating a product or service that meets their needs or wants. Therefore, the statement is true.

Question 13

McDonald's restaurants inside Wal-Marts and Starbucks inside Super Targets are examples of ________, whose main advantages are that the products can or may be convincingly positioned by virtue of the associated brands.
A) cooperative marketing
B) cross-promotion
C) retail co-branding
D) ingredient branding
E) feature promotion

Accepted Answer

Retail co-branding is the practice of two or more brands sharing the same retail space, such as McDonald's inside Wal-Marts and Starbucks inside Super Targets. The advantages of retail co-branding include the ability to leverage the strong brand equity of the partner brands to create a more compelling offering for customers. Cooperative marketing involves two or more companies working together to promote a product or service, cross-promotion involves promoting related products or services together, ingredient branding involves highlighting a component of a product, and feature promotion involves promoting a specific aspect or feature of a product.

Question 14

A product is anything that can be offered to a market to satisfy a want or need.

Accepted Answer

This is the definition of a product.

Question 15

A new product is advertised on the "infomercials" as being "the best cleaner money can buy" and "if not completely satisfied, return the product for a full refund, including shipping." The strategy of using a strong guarantee in this instance is sound because ________.
A) it is an example of a misleading or false advertising and is illegal
B) the product is so superior to competition that there will be no claims for refunds
C) it is just "advertising fluff" and the manufacturer has no intentions of refunding money
D) for a product that is not too well known, it is "good advertising" because the claims will be a small percentage of sales
E) for a product that is not too well known it reduces the buyer's risk in purchasing

Accepted Answer

The use of a strong guarantee is a good strategy for a product that is not well known because it reduces the buyer's risk and increases their confidence in making a purchase. This can ultimately lead to more sales and greater customer satisfaction. It is not a form of false advertising as long as the guarantee is genuine and the manufacturer follows through on their promise of a full refund.

Question 16

The main advantage of co-branding is that a product may be convincingly positioned by virtue of the ________ involved.
A) branding synergy
B) increased advertising dollars
C) multiple brands
D) bundled package
E) pure bundling

Accepted Answer

The answer of The main advantage of co-branding is that...

Question 17

Purchasers of theatre tickets receive a 20% discount if they purchase and pay for the full season at one time. This is an example of what type of product-mix pricing?
A) mixed bundling
B) pure bundling
C) cross-promotion
D) captive pricing
E) two-part pricing

Accepted Answer

Mixed bundling involves offering a discount or incentive for purchasing a bundle of products or services together, as in the case of buying a full season of theatre tickets at a discounted rate.

Question 18

Some service firms often engage in ________, consisting of a fixed fee plus a variable usage fee.
A) pure bundling
B) pure pricing
C) mixed pricing
D) captive pricing
E) two-part pricing

Accepted Answer

Two-part pricing is a pricing strategy where the service firm charges a fixed fee for a product or service along with a variable usage fee. This strategy is common in service industries where customers may need ongoing access to a product or service. The fixed fee covers the cost of providing the service, while the usage fee ensures that the firm is compensated for each time the service is used. This pricing model is often used for memberships, subscriptions, and other ongoing services.

Question 19

Sales of luxury goods such as perfumes, colognes, and aftershaves depend heavily upon their initial response by the consumer. A well-designed package can create convenience and promotional value. It has been called the "silent salesman." Which of the three levels of packaging is this "silent salesman"?
A) retailer
B) consumer
C) shipping
D) secondary
E) primary

Accepted Answer

The "silent salesman" packaging is the primary level of packaging, which refers to the immediate container used for a product (such as the bottle for a perfume). The primary packaging is the level of packaging that is most visible to the consumer and can heavily influence their purchasing decision.

Question 20

The potential disadvantages of ________ are the risks and lack of control from becoming aligned with another brand in the consumers mind. Consumer expectations about the level of involvement and commitment are likely to be high, so unsatisfactory performance could be very negative for the brands involved.
A) co-branding
B) cannibalization
C) vertical integration
D) disintermediation
E) brand stretching

Accepted Answer

Co-branding can have potential disadvantages, such as the risk of becoming too closely aligned with another brand and consumer expectations for high levels of involvement and commitment. Unsatisfactory performance could have negative consequences for both brands involved.

Quiz 12: Setting Product Strategy

When shopping for tires for your automobile, you notice that the manufacturer you have selected has tires for your car priced low, average, and high, based upon performance and features. This is an example of what type of product-mix pricing?

Price-setting logic must be modified when the product is part of a product mix. In that case, the firm searches for a set of prices that ________ profits on the total mix.

In ________, the seller offers goods both individually and in bundles and often charges less for the "bundle" than for the individual products.

________ are formal statements of expected product performance by the manufacturer.

Guarantees are most effective in two situations. The first is when the company or products are not well known and the second is when the product's quality is ________ to competition.

We define packaging as all the activities of designing and producing the container for a product. This includes up to three levels of material: primary package, secondary package, and ________.

Betty Crocker cake mixes using Hershey syrup in its cake mixes and "Lunchables" lunch combinations with Taco Bell tacos are examples of what special type of branding?

Which of the following factors is one of the contributors to the growing use of packaging as a marketing tool?

Companies normally develop ________ rather than single products and require sellers to establish perceived quality differences between price steps within it.

________ is a special case of co-branding involving creating brand equity for materials, components, or parts that are necessarily contained within other branded products.

Many sellers offer either general or specific guarantees. Guarantees reduce the buyer's ________ risk.

Marketing planning begins with formulating an offering to meet target customers' needs or wants.

McDonald's restaurants inside Wal-Marts and Starbucks inside Super Targets are examples of ________, whose main advantages are that the products can or may be convincingly positioned by virtue of the associated brands.

A product is anything that can be offered to a market to satisfy a want or need.

A new product is advertised on the "infomercials" as being "the best cleaner money can buy" and "if not completely satisfied, return the product for a full refund, including shipping." The strategy of using a strong guarantee in this instance is sound because ________.

The main advantage of co-branding is that a product may be convincingly positioned by virtue of the ________ involved.

Purchasers of theatre tickets receive a 20% discount if they purchase and pay for the full season at one time. This is an example of what type of product-mix pricing?

Some service firms often engage in ________, consisting of a fixed fee plus a variable usage fee.