Question 1

PepsiCo and Coca-Cola sponsor traveling carnivals in rural Latin America to encourage product trial. This element of marketing communications is called ________.

Accepted Answer

Sales promotion includes activities like discounts, samples, special deals, etc. that are designed to stimulate consumer purchasing and trial of a product. PepsiCo and Coca-Cola sponsoring traveling carnivals in rural Latin America is an example of sales promotion aimed at encouraging product trial.

Question 2

Well-established distributors in a marketing channel often have relationships with competitors. In the context of market channels, which of the following channel strategies corresponds to this issue?

Accepted Answer

The issue of distributors having relationships with competitors relates to continuity in the marketing channel. Continuity refers to the flow of products and services through the channel and maintaining the consistency of the relationships among the channel members. In this case, the distributor's relationship with competitors could affect the continuity of the channel.

Question 3

Which of the following channel strategies helps in increasing the efficiency of local distribution systems by eliminating unnecessary middlemen?

Accepted Answer

The cost channel strategy involves evaluating the cost structure of the distribution system and identifying areas where costs can be reduced. One way to reduce costs is by eliminating unnecessary middlemen, which can increase the efficiency of the local distribution system. Therefore, the cost channel strategy helps in increasing the efficiency of local distribution systems by eliminating unnecessary middlemen.

Question 4

Charging a price that is lower than actual costs or less than the company charges in its home market is called ________.

Accepted Answer

Dumping is the practice of charging a price that is lower than actual costs or less than the company charges in its home market. This is done to gain a competitive advantage in the importing market, and is often considered unfair trade practice. Gray marketing refers to the unauthorized distribution of genuine branded products, while price fixing is the collusion between competitors to fix prices. Compensation trading and offset pricing are not relevant to this term.

Question 5

________ is the net benefits (or costs) associated with a product or service, and it is affected by the buyer's trust that the company will keep its promises.

Accepted Answer

Value refers to the net benefits or costs associated with a product or service, which takes into account not only the outlay of money but also other factors such as time, effort, and risk. The buyer's trust in the company to keep its promises can affect the perceived value of the product or service. Accreditation refers to a formal recognition of a company or product's quality or standards, and exchange simply refers to the act of trading goods or services for something else. Gain could also be a possible answer, but it is more general and does not necessarily relate specifically to trust or value.

Question 6

________ encompasses a societal and professional standard of right and fair practices that are expected of marketing managers in their oversight of strategy formulation, implementation, and control.

Accepted Answer

The definition provided in the question best aligns with the concept of marketing ethics, which refers to the moral principles and values that guide the behavior of marketers in their decision-making and interactions with stakeholders. Price fixing is a type of anticompetitive behavior that is illegal, rather than a standard of ethical conduct. Social responsibility is a broader concept that encompasses a company's obligation to act in the best interests of society as a whole, while accreditation refers to the process of certification or recognition of a program or institution. Personal selling is a specific type of marketing communication tactic, which is not directly relevant to the question.

Question 7

Perdue found that one of its chicken products may have been contaminated with bacteria, so it pulled it off the shelves and instituted a recall. This potential ethical issue was associated with which element of the marketing mix?

Accepted Answer

The potential ethical issue of product contamination falls under the element of the marketing mix known as "product".

Question 8

Ford Motor Co. introduced its automobile called Nova in Mexico. It faced difficulty in selling the car because "Nova" in Spanish means "It doesn't go." This illustrates a problem with ________.

Accepted Answer

The difficulty faced by Ford in selling the car in Mexico indicates a problem with fitting the product to the culture. The name "Nova" in Spanish means "It doesn't go," and this shows that the product name was not suitable for the Mexican culture. Fitting the product to the culture is a crucial aspect of international marketing as it helps in ensuring acceptance and success of the product in new markets.

Question 9

Jason went to an automobile dealership to buy a car, and he spent two hours talking to an employee about options. This element of marketing communications is called ________.

Accepted Answer

Personal selling involves face-to-face communication between a salesperson and a potential customer, which is what occurred in this scenario. Advertising refers to non-personal, mass communication through various media channels, promotion is a broader term that encompasses all marketing communication activities, public relations is focused on building relationships with the public and direct marketing is a form of marketing where companies communicate directly with customers through mail, email or other channels.

Question 10

Latosha was thrilled when she found a low-cost airfare to Moscow, but she was not happy when she bought the tickets and realized there were hundreds of dollars in added fees. Which element of the marketing mix was impacted?

Accepted Answer

The added fees impacted the price element of the marketing mix.

Question 11

When distributors do not have authorization from manufacturers but divert products from low-price markets and sell them in high-price markets, they are practicing ________.

Accepted Answer

This practice is known as gray market distribution, where distributors obtain products from unauthorized sources and sell them at a higher price in a market where the product has a higher demand and fetches a higher price.

Question 12

The task of handling crises and giving the company's perspective to news organizations belongs in the ________ element of marketing communications.

Accepted Answer

Handling crises and giving the company's perspective to news organizations falls under the domain of public relations, which is concerned with building and maintaining mutually beneficial relationships between organizations and various stakeholders, including the media. Advertising, personal selling, sales promotion, and direct marketing are not as relevant in crisis management and media relations.

Question 13

Aligning the firm's philosophy with that of a potential channel partner would be identified in the channel strategy of ________.

Accepted Answer

Character refers to the values and beliefs of the firm, which should align with those of potential channel partners. This is important for building trust and a strong working relationship between the firm and its partners. Cost, coverage, continuity, and control are also important factors in channel strategy, but they do not specifically address the alignment of philosophical values.

Question 14

People around the world prefer Swiss watches over watches manufactured in other countries. In the context of product issues, which of the following best describes the customer's perception?

Accepted Answer

The customer's preference for Swiss watches demonstrates the country-of-origin effect, which suggests that consumers perceive products made in certain countries to be of higher quality or superior to those made in other countries.

Question 15

Steve wants to gift a box of chocolates to his best friend. He walks into a store and buys Belgian chocolates because his friend once mentioned that they are the best in the world. This is an example of how consumers respond to ________.

Accepted Answer

This is an example of the country-of-origin effect, where consumers associate a particular product or brand with a specific country or place, based on factors such as reputation or perceived quality. In this case, Steve's friend had mentioned that Belgian chocolates are the best, which influenced Steve's decision to purchase them.

Question 16

Prices of products are often higher in a foreign country than the home country due to transportation charges, taxes, tariffs, and exchange rate fluctuations. This change in price from home country to foreign country is referred to as ________.

Accepted Answer

Price escalation refers to the increase in prices of products when they are sold in a foreign country compared to their prices in the home country due to reasons such as transportation costs, taxes, tariffs, and exchange rate fluctuations. The other options (B, C, D, and E) are not accurate descriptions of price changes from home country to foreign country.

Question 17

Most global marketers rely on local distribution networks in foreign markets. This is because it is very expensive to build a company's own distribution network in a foreign market. This issue can be identified in the channel strategy of ________.

Accepted Answer

The issue of relying on local distribution networks due to the high cost of building a company's own distribution network in a foreign market is identified in the channel strategy of control. This is because using local networks often means the company has less control over the distribution process compared to if it owned the distribution network outright.

Question 18

What area in marketing presents the most ethical challenges?

Accepted Answer

The answer of What area in marketing presents the most...

Question 19

Delxen Inc., a multinational company, uses the same prices for all its products globally. This type of pricing is called ________.

Accepted Answer

Delxen Inc. uses the same prices for all its products globally, which is known as "one world price," as mentioned in option B. Going-rate pricing (option A) is a strategy in which companies set their prices based on the prevailing market conditions in a particular region or country. Local market condition pricing (option C) considers the local market conditions such as demand and supply, competition, and government policies while setting the prices. Transfer pricing (option D) is the pricing strategy used by multi-divisional companies to set a price for goods and services transferred between different units of the organization. Cost-based pricing (option E) is a pricing strategy in which companies set the prices by adding a markup percentage to the cost of producing the product.

Question 20

In the context of market channels, the use of local distribution networks to reach target customers is identified in the ________ channel factor.

Accepted Answer

The coverage channel factor is concerned with the selection of the appropriate distribution networks to ensure that the product reaches the target customers. Local distribution networks can be a part of an effective coverage strategy as they provide access to customers in specific geographic areas. Therefore, the use of local distribution networks is identified under the coverage channel factor.

Quiz 2: Marketing Foundations: Global, Ethical, Sustainable