Question 1

Which type of distribution strategy is most appropriate for most shopping products?

Accepted Answer

Selective distribution is most appropriate for shopping products because it involves placing products in a few selected retail outlets in a territory. This strategy balances the need for widespread availability against the desire to maintain a certain level of exclusivity or control over the product's presentation and pricing. Shopping products are those that consumers buy less frequently, compare on attributes such as quality, price, and style, and thus require a more thoughtful distribution approach than convenience products, which benefit from intensive distribution.

Question 2

Leadership in a(n) ________ is assumed not through common ownership or contractual ties but through the size and power of a single dominant channel member.

Accepted Answer

In an administered vertical marketing system, leadership is assumed through the size and power of a single dominant channel member who administers and coordinates the activities of the other members. The other options do not involve a single dominant channel member.

Question 3

A retailer cooperative is a form of a(n) ________ vertical marketing system (VMS).

Accepted Answer

A retailer cooperative is a type of contractual VMS, where independent retailers join together to form a cooperative to operate their businesses more efficiently and effectively. They do this by pooling resources, such as purchasing power or advertising, while still maintaining their independence.

Question 4

When determining the number of channel members to use at each level, three strategies are available: intensive, exclusive, and ________ distribution.

Accepted Answer

Selective distribution would allow for a balance between market coverage and control over the distribution channels. It is often the most efficient and effective strategy for reaching target customers while maintaining brand image and quality control. Intensive distribution would result in a widely dispersed product and potentially lessen the control over the distribution channels, while exclusive distribution would limit the market coverage and potentially result in missed sales opportunities.

Question 5

Chewing gum is stocked in many outlets in the same market or community; in fact, it is placed in as many outlets as possible. This is an example of ________ distribution.

Accepted Answer

Intensive distribution involves making the product available in as many outlets as possible, which is exactly what is done with chewing gum. This approach aims to maximize the product's availability and convenience for consumers.

Question 6

A selective distribution strategy is most suitable for which consumer product category?

Accepted Answer

Selective distribution is most suitable for shopping products, which require a balance between intensive and exclusive distribution to ensure availability while maintaining a certain level of prestige and customer service.

Question 7

Which of the following is another name for the channel leader?

Accepted Answer

The channel leader is also known as the channel captain.

Question 8

A channel consisting of one or more independent producers, wholesalers, or retailers, each seeking to maximize its own profits with little concern for other channel members, is a(n) ________.

Accepted Answer

A conventional marketing system is characterized by independent channel members who each seek to maximize their own profits with little concern for other channel members. This type of system is also known as a conventional distribution channel.

Question 9

Which of the following statements about a vertical marketing system (VMS) is true?

Accepted Answer

A VMS involves cooperation among channel members at different levels of the channel, which can lead to increased efficiency and effectiveness in distribution. The three types of VMS are corporate, administered, and contractual. Channel conflict can still occur in a VMS, but it is often easier to resolve due to the closer relationships between channel members. Conventional marketing systems are not necessarily more efficient than VMS, as it depends on the specific circumstances of the market and products being sold.

Question 10

A corporate VMS has the advantage of controlling the entire distribution chain under ________.

Accepted Answer

A corporate VMS is characterized by single ownership and control over the entire distribution chain. This allows for more efficient coordination and management of the various functions involved in the distribution process. The other options (franchise licenses, mass distribution, informal cooperation, and contractual agreements) do not provide the same level of control and integration as a corporate VMS.

Question 11

Increasingly commonplace today is the appearance of two different franchise chains under the same roof, such as Pizza Hut and Taco Bell. This is an example of a(n) ________ marketing system.

Accepted Answer

This is an example of a horizontal marketing system, where two or more unrelated companies join together to share a distribution channel. In this case, Pizza Hut and Taco Bell are both fast-food chains but offer different types of cuisine, making it a horizontal arrangement.

Question 12

Which type of distribution means limiting distribution of a product to a single outlet in a particular region?

Accepted Answer

Exclusive distribution involves limiting the distribution of a product to a single outlet in a particular region. This is often used for luxury or high-end products where the manufacturer wants to maintain tight control over the image and presentation of the product. Intensive distribution involves placing the product in as many outlets as possible, while selective distribution involves limiting distribution to a select group of outlets that meet certain criteria. Independent distribution refers to selling products through non-affiliated retailers or distributors, while insourced distribution involves handling distribution in-house instead of outsourcing to third-party companies.

Question 13

Which of the following is NOT a true statement about conventional marketing systems?

Accepted Answer

This statement is not true as members of conventional marketing systems do work toward the same broad goals, such as increasing sales and profits for the overall system.

Question 14

Which of the following is most likely exclusively distributed?

Accepted Answer

BMW automobiles are known for their exclusive distribution through authorized dealerships, and the company closely controls access to their brand and products. Diesel blue jeans, Bazooka bubble gum, Prairie Farms yogurt, and Coca-Cola beverages are all widely distributed through various retailers and channels.

Question 15

In a ________, two or more companies at the same channel level join together for a common purpose.

Accepted Answer

A horizontal marketing system involves two or more companies at the same channel level joining together for a common purpose, such as coordinating logistics or sharing marketing expenses. A franchise involves a contractual agreement where one company (the franchisor) allows another company (the franchisee) to sell its products or services under the franchisor's brand name and operating system. A corporate VMS involves a single company owning multiple levels of the distribution channel. A multiple distribution system involves a company using multiple channels to reach different customers or market segments. A conventional marketing system involves multiple independently operating companies at different channel levels working together to bring a product or service to the end consumer.

Question 16

Burger King, Holiday Inn, Avis, and H&R Block tax service are all franchises, which means they are also members of a(n) ________ vertical marketing system (VMS).

Accepted Answer

Burger King, Holiday Inn, Avis, and H&R Block tax service are all franchises, which means they are a part of a contractual vertical marketing system (VMS), where the franchisees have an agreement to follow the franchisor's rules and guidelines. The franchisees are also able to use the franchisor's brand name and marketing strategies.

Question 17

Which of the following is most likely intensively distributed?

Accepted Answer

Coca-Cola beverages are a fast-moving consumer good and are typically sold through intensive distribution channels, such as grocery stores, convenience stores, and vending machines. The other products listed may also have intensive distribution, but not to the same extent as Coca-Cola.

Question 18

What are the three major types of vertical marketing systems?

Accepted Answer

The three major types of vertical marketing systems are corporate, contractual and administered. Corporate vertical marketing systems exist when a firm owns all members of the distribution channel, while contractual vertical marketing systems depend on contractual agreements between independent firms. Administered vertical marketing systems do not rely on ownership or contracts, but rather on one member of the channel exercising dominance through its size and power. The other answer choices are either incorrect (e.g. "independent" and "franchised" are not types of vertical marketing systems) or have the types listed in the wrong order.

Question 19

Because each firm in a channel has its own objectives, ________ may threaten a distribution strategy through incompatible goals or poor communication.

Accepted Answer

Channel conflict occurs when the objectives of different firms in a channel are incompatible, which can lead to poor communication and difficulty in implementing a distribution strategy. Channel power refers to the ability of a firm to control or influence the behavior of other firms in a channel. Channel cooperation refers to firms working together in a mutually beneficial way. Legitimate power is authority based on a position or role, while coercive power is the use of threats or punishment to influence behavior. Only choice A describes the situation where objectives of different firms threaten a distribution strategy through poor communication or incompatibility.

Question 20

Conventional distribution channels consist of one or more ________ producers, wholesalers, and retailers.

Accepted Answer

Conventional distribution channels are made up of independent producers, wholesalers, and retailers who are not bound by long-term agreements, allowing for flexibility and adaptation to market changes.

Quiz 11: Deliver the Goods: Determine the Distribution Strategy