Question 1

Penelope's Pizza, a local chain of carryout restaurants, has made the decision to expand to a national basis. It plans to open 50 Penelope's in 20 cities across the country within the next two years. In order to efficiently integrate all the tools and company resources to maximize the impact on new customers, Penelope's Pizza is considering using an integrated marketing strategy to promote a coherent national brand perception. The account manager argues that an integrated marketing strategy is the way to go, but the CEO argues that each local community is different, and the needs, values, and norms of the host cities should drive the marketing campaign. After becoming a successful national brand, Penelope's Pizza has made the decision to expand overseas and enter the global market. Using a globally integrated marketing plan, Penelope's plans to enter the pizza market in Germany, Japan, and India. The CEO wants to use an adaptation plan in the new markets, and thus offer kielbasa pizza in Germany, sushi pizza in Japan, and vegetarian pizza in India. The advertising firm recommends a standardization approach as being more cost efficient and brand identifiable. Which statement, if true, supports the CEO's argument?
A) Traditionally, all three markets are slow to adapt to the idea of fast food, and prefer meals with known ingredients that are familiar to them.
B) The cost of introducing new ingredients to the menu will increase the price of pizza by 15 percent.
C) Marketing surveys show that the under-30 generation in each of the three countries is increasingly eager to consume fast food as a status symbol of increasing wealth.
D) The current economic slump has decreased the volume of sales for all fast foods on a global basis.
E) Obtaining vendors for new pizza toppings would require the hiring of additional translators in each country.

Accepted Answer

The CEO's argument for an adaptation plan is supported by the statement that markets prefer meals with known, familiar ingredients, which aligns with offering localized pizza variations like kielbasa in Germany, sushi in Japan, and vegetarian in India.

Question 2

Hilltel sells mobile phones and other handheld devices. The company has decided to sell its products internationally and is considering using a standardized marketing approach wherever it sells its products. Hilltel's CEO thinks that having a standardized marketing strategy will enable the company to control and plan production better. Which of the following, if true about using a single marketing approach, would strengthen her case?
A) It means the company will sell in the same way to countries regardless of culture.
B) It allows for simplifying inventory and quality control processes.
C) It means that more employees will need to be hired at the company's headquarters.
D) It locks the company into one marketing strategy for the long term.
E) It means that more extensive managerial oversight in sales will be needed.

Accepted Answer

Using a standardized marketing approach would allow for simplifying inventory and quality control processes, which would help the company control and plan production better, as mentioned in the CEO's reasoning. This would strengthen her case for using a single marketing approach. Option A indicates potential issues with cultural differences, option C suggests increased costs, option D indicates inflexibility, and option E indicates potential managerial challenges, none of which necessarily support the CEO's argument.

Question 3

Snazzy Sodas is known for its variety of all-natural sodas as well as its efforts toward social responsibility. The company has decided to produce a new line of energy drinks, and while it does not have the resources to promote its product widely, it can make a sizeable impact with a carefully chosen market segment. The CEO favours marketing the product primarily to young males, but the VP of operations recommends targeting female professionals. Which of the following, if true, would weaken the VP of operation's position?
A) Success in the energy drink market was an important goal mentioned in the company's annual report.
B) Young males have demonstrated low awareness of many soda brands.
C) Professionals tend to have more disposable income than nonprofessionals.
D) Concern over social responsibility is rising across a wide variety of market segments.
E) Professionals are more likely than nonprofessionals to be concerned about the long-term health effects of energy drinks.

Accepted Answer

If professionals are more concerned about the long-term health effects of energy drinks, they may be less likely to purchase them, weakening the VP's position to target female professionals.

Question 4

Dinasonic manufactures and markets consumer kitchen products. The company is preparing to introduce its products to international markets. The company's director of marketing wants the company to adapt its marketing approach to the various markets in different countries that the company is looking to enter. He needs to defend the proposal for his recommended marketing strategy to the rest of the executive team. The director of marketing argues that Dinasonic should use an adaptation strategy for its marketing because its products will need to be adapted to different markets. Which of the following, if true, would strengthen this position?
A) Dinasonic's products have consistently had the most competitive prices in the Canadian market.
B) For the kinds of products that Dinasonic makes, preferences for their use vary between different cultures.
C) Dinasonic will not face much competition in the countries in which it plans to sell its products.
D) Dinasonic will have a limited advertising budget for its international marketing efforts.
E) Dinasonic has consistently gained in market share in Canada over the last several years.

Accepted Answer

The fact that preferences for the use of Dinasonic's products vary between different cultures supports the idea that an adaptation strategy would be necessary for successful international marketing.

Question 5

Otto's Office Products is a large national company selling office supplies to businesses and everyday consumers. It is compiling an in-house data warehouse in order to identify customers and build relationships with them. The IT department has recommended that Otto's use data mining to build customer profiles and prepare business models to predict future purchasing behaviour. Otto's CEO is not in favour of data mining, and argues that it shouldn't be used. Which of the following statements, if true, would support the CEO's argument for not using data mining?
A) Data mining can build profiles of Otto's best customers and then use behavioural characteristics to identify new customers.
B) Data mining is helpful to salespeople as it can identify customers that would benefit from an individual sales call, or provide them with buying reminders for particular products.
C) Data mining can be used to track online behaviour of the customers by the use of cookies, and identify customer interests and business needs.
D) A privacy paradox exists whereby mining personal information is intrusive, but also leads to better targeting.
E) Data mining can help spot trends and patterns in customer purchases, and enable the marketing department to shape advertising around these trends.

Accepted Answer

This statement highlights the ethical issue of customer privacy and personal information being collected through data mining, which supports the CEO's argument against using data mining.

Question 6

Penelope's Pizza, a local chain of carryout restaurants, has made the decision to expand to a national basis. It plans to open 50 Penelope's in 20 cities across the country within the next two years. In order to efficiently integrate all the tools and company resources to maximize the impact on new customers, Penelope's Pizza is considering using an integrated marketing strategy to promote a coherent national brand perception. The account manager argues that an integrated marketing strategy is the way to go, but the CEO argues that each local community is different, and the needs, values, and norms of the host cities should drive the marketing campaign. Which of the following practices would support the CEO's argument?
A) Penelope's Pizza decides to pursue a co-branding partnership with either Pepsi or Coke.
B) Penelope's Pizza employees all must wear the same uniform.
C) Penelope's corporate website has links to individual stores for ordering pizza online.
D) All Penelope's Pizza restaurants have an art deco interior design.
E) Penelope's Pizza encourages individual stores to create their own menu options and pricing structure.

Accepted Answer

Encouraging individual stores to create their own menu options and pricing structure would support the CEO's argument that each local community is different and that the marketing campaign should be based on their needs, values, and norms. This would allow the stores to tailor their menu and pricing to the local market, creating a stronger connection with customers and increasing the likelihood of success. The other choices (A, B, C, and D) all promote a cohesive and standardized brand image, which aligns with the account manager's argument for an integrated marketing strategy.

Question 7

Snazzy Sodas is known for its variety of all-natural sodas as well as its efforts toward social responsibility. The company has decided to produce a new line of energy drinks, and while it does not have the resources to promote its product widely, it can make a sizeable impact with a carefully chosen market segment. The CEO favours marketing the product primarily to young males, but the VP of operations recommends targeting female professionals. Which of the following, if true, would weaken the CEO's position?
A) Young males have shown strong brand loyalty to the current market leader in energy drinks.
B) Young males are especially likely to be opinion leaders on many lifestyle issues.
C) Clothing companies typically segment more precisely than beverage companies.
D) Even effective targeting does not guarantee success when it is followed by ineffective positioning.
E) As compared to other groups, young males spend a high percentage of their income on discretionary purchases.

Accepted Answer

If young males are already brand loyal to a competitor in the energy drink market, it may be difficult for Snazzy Sodas to successfully target them. This weakens the CEO's position in favour of targeting young males.

Question 8

DVD Heaven sells new and used DVDs, particularly to university and college students in large Canadian cities. It plans to expand its business online, hoping to increase sales by offering a more convenient means of ordering for busy college students. The vice-president of marketing suggests opening a Facebook page for DVD Heaven, but the president argues that social media sites would not help its business. Which of the following statements, if true, would support the argument made by the president for not using social media sites as part of DVD Heaven's advertising strategy?
A) Social media is changing so rapidly that what is relevant today may easily be outdated tomorrow.
B) Search ads combined with social media campaigns lead to higher results for products than just using general search ads.
C) Brands entered in social networks as topics or members of the community can build customer relations.
D) Social media sites can increase buzz and word of mouth simply by conversation about a product or business.
E) Social media sites provide real-time discussions that can include the latest DVDs available or recommendations for DVD purchases.

Accepted Answer

The statement that social media is changing rapidly and can quickly become outdated suggests that investing in a social media strategy may not be worth the time and resources for DVD Heaven if the platform becomes irrelevant in the near future.

Question 9

Dinasonic manufactures and markets consumer kitchen products. The company is preparing to introduce its products to international markets. The company's director of marketing wants the company to adapt its marketing approach to the various markets in different countries that the company is looking to enter. He needs to defend the proposal for his recommended marketing strategy to the rest of the executive team. The director of marketing argues that Dinasonic should alter its marketing strategy in different countries by adapting its methods of advertising. Which of the following, if true, would support this position?
A) Dinasonic has won awards for its advertising campaigns.
B) Consumers in most countries are attracted to Canadian consumer goods.
C) Laws regulating advertising vary between different countries.
D) Dinasonic has several sales managers experienced in international sales.
E) The company is planning to subcontract some of its international sales operations.

Accepted Answer

The fact that laws regulating advertising vary between different countries supports the argument that Dinasonic should adapt its methods of advertising in different markets. Adhering to local laws and cultural norms is important for successful marketing in international markets. The other options are not relevant to the argument for adapting marketing strategy in different countries.

Question 10

Macmoo Real Estate is beginning to use data-driven processes to determine the value that it gets from different marketing activities. Macmoo's website lists available properties and allows customers to request information. Macmoo tends to advertise in local newspapers and specialized real estate periodicals. The marketing director believes that Macmoo's traditional spring advertising campaign, which runs during the month of March, is an effective use of advertising resources. When pressed for evidence, the marketing director points out that revenues in March have consistently been higher than revenues in February. Which of the following is assumed by the marketing director's argument?
A) Real estate transactions can usually be completed in one month.
B) The rates for advertising during the spring are lower than the rates during other times of the year.
C) Other real estate companies increase the amount they spend on advertising during March.
D) The spring advertising campaign is better at promoting general awareness of the Macmoo brand than it is at generating sales leads.
E) The spring advertising campaign is equally effective for commercial real estate and private real estate.

Accepted Answer

The marketing director's argument assumes that the increase in revenues in March, following the advertising campaign, is directly attributable to the campaign's effectiveness. This implies that the transactions influenced by the campaign can be completed within the same month, hence the assumption that real estate transactions can usually be completed in one month.

Question 11

Penelope's Pizza, a local chain of carryout restaurants, has made the decision to expand to a national basis. It plans to open 50 Penelope's in 20 cities across the country within the next two years. In order to efficiently integrate all the tools and company resources to maximize the impact on new customers, Penelope's Pizza is considering using an integrated marketing strategy to promote a coherent national brand perception. The account manager argues that an integrated marketing strategy is the way to go, but the CEO argues that each local community is different, and the needs, values, and norms of the host cities should drive the marketing campaign. Penelope's Pizza also wants to be at the forefront of current trends and changes in the practice of advertising. The account manager wants to focus on consumer generated advertising via YouTube, Twitter, and Facebook, whereas the CEO prefers to focus on mainstream media. Which of the following, if true, would support the position of the account manager?
A) The number of television cable channels has skyrocketed in recent years.
B) Over the same time, the four major television networks suffered a 20 percent decrease in viewership, leading to a reduction in advertising rates.
C) The emphasis on effectiveness and accountability has lowered the production costs for a 30-second television commercial.
D) Television networks are seeking to ban the feature in recording devices that allows viewers to record television shows while deleting all commercial messages.
E) Young adults, under the age of 30, consume the largest amount of pizza per capita and are the greatest users of social media.

Accepted Answer

The fact that young adults, who are the biggest consumers of pizza and also the biggest users of social media, support the account manager's proposal to focus on consumer-generated advertising through YouTube, Twitter, and Facebook. It also supports the idea that Penelope's Pizza needs to be at the forefront of current trends and changes in advertising.

Question 12

Hilltel sells mobile phones and other handheld devices. The company has decided to sell its products internationally and is considering using a standardized marketing approach wherever it sells its products. Hilltel's head of marketing thinks that a standardized marketing strategy will allow the company to portray a consistent global brand. Which of the following, if true about using a single marketing approach, would strengthen his case?
A) The company would face more competition overseas than otherwise.
B) The company's products would need to be of the most recent technology.
C) The prices of the company's products will be the same everywhere in the world.
D) An international marketing team would need to be hired to craft an appropriate strategy.
E) The company's products could be standardized accordingly.

Accepted Answer

If the company's products can be standardized accordingly, then a standardized marketing strategy would make sense. This would ensure consistency in branding and messaging across different markets without the need for significant variations in marketing strategy. Therefore, option E would strengthen the case for using a standardized marketing approach. Options A, B, C, and D are irrelevant to the argument for a standardized marketing strategy.

Question 13

Snazzy Sodas is known for its variety of all-natural sodas as well as its efforts toward social responsibility. The company has decided to produce a new line of energy drinks, and while it does not have the resources to promote its product widely, it can make a sizeable impact with a carefully chosen market segment. The CEO favours marketing the product primarily to young males, but the VP of operations recommends targeting female professionals. Which of the following, if true, would support the CEO's position?
A) Snazzy decided that producing a line of energy drinks would be more profitable than attempting to penetrate international markets.
B) Young males, as a group, consume more energy drinks than any other market segment.
C) Energy drinks cost more per ounce than other popular beverages.
D) Energy drink manufacturers have recently tried to associate their product with positive social causes.
E) Different companies define "young" differently.

Accepted Answer

This option directly supports the CEO's position by providing evidence that young males consume more energy drinks than any other market segment. This suggests that marketing the energy drinks to this demographic may be more effective in generating sales. The other options do not address the target market directly and are therefore less relevant to the decision at hand.

Question 14

DVD Heaven sells new and used DVDs, particularly to university and college students in large Canadian cities. It plans to expand its business online, hoping to increase sales by offering a more convenient means of ordering for busy college students. The president of DVD Heaven has been talking to several other business owners, and now expresses some concerns over developing the e-commerce side of the business. The vice-president argues that it is essential for continued growth, but the president argues that there are too many consumer concerns.
Which of the following statements, if true, would not support the argument being made by the president regarding consumer concerns?
A) Fraudulent businesses are being set up and run on the Internet. Many consumers would rather enter a building that houses a business they know really exists.
B) Identity theft and the theft of credit card numbers can occur when ordering online.
C) Privacy can be compromised on the Internet, and unethical e-businesses can track or sell sensitive information such as buying patterns.
D) College students are five times more likely to order over the Internet than older adults.
E) Customers like to see and feel products before ordering them.

Accepted Answer

This statement indicates that college students are more likely to order online, which contradicts the president's argument that there are too many consumer concerns regarding e-commerce.

Question 15

Snazzy Sodas is known for its variety of all-natural sodas as well as its efforts toward social responsibility. The company has decided to produce a new line of energy drinks, and while it does not have the resources to promote its product widely, it can make a sizeable impact with a carefully chosen market segment. The CEO favours marketing the product primarily to young males, but the VP of operations recommends targeting female professionals. Which of the following questions is least relevant to Snazzy Sodas's evaluation of the desirability of the young male market segment?
A) What is the percentage of young males in the general population?
B) What attitudes do members of this group likely have about Snazzy Sodas?
C) How does the consumption of energy drinks by young males compare to the consumption patterns of other groups?
D) Would Snazzy Sodas be likely to target young males if it were producing a different product?
E) Are young males likely to consider a company's reputation for social responsibility when they purchase energy drinks?

Accepted Answer

This question is least relevant because it is asking about Snazzy Sodas' decision-making process for a different product, not specifically about the suitability of the young male market for the new energy drink line. A, B, C, and E are all relevant questions to consider when evaluating the potential of the young male market segment for the new energy drinks.

Question 16

Dinasonic manufactures and markets consumer kitchen products. The company is preparing to introduce its products to international markets. The company's director of marketing wants the company to adapt its marketing approach to the various markets in different countries that the company is looking to enter. He needs to defend the proposal for his recommended marketing strategy to the rest of the executive team. The director of marketing argues that Dinasonic's products will need to be adapted to local markets to fit the standard of living in other countries. Which of the following, if true, would strengthen this position?
A) Dinasonic plans to enter only markets in advanced economies.
B) Dinasonic has some of the best marketing talent in the industry.
C) Dinasonic's manufacturing processes are very cost-effective.
D) None of Dinasonic's major competitors will be entering the same markets Dinasonic will.
E) Many consumers in developing economies would not be able to afford Dinasonic's products.

Accepted Answer

This strengthens the position that Dinasonic's products will need to be adapted to fit the standard of living in other countries. If many consumers in developing economies cannot afford the products, then adapting the products to fit the local market's standard of living may make them more accessible and appealing to consumers in those regions.

Question 17

Snazzy Sodas is known for its variety of all-natural sodas as well as its efforts toward social responsibility. The company has decided to produce a new line of energy drinks, and while it does not have the resources to promote its product widely, it can make a sizeable impact with a carefully chosen market segment. The CEO favours marketing the product primarily to young males, but the VP of operations recommends targeting female professionals. Which of the following, if true, would most strongly support the VP of operation's position?
A) Industry-leading companies tend to target as wide a market as possible.
B) Female professionals are more likely to stay with a known brand for expensive items such as cars.
C) Female professionals tend to have a strongly positive opinion of Snazzy's current products.
D) Young females consume more energy drinks per person than the general population.
E) Male professionals often report a lack of energy while at work.

Accepted Answer

The recommendation to target female professionals is most strongly supported if they already have a positive opinion of Snazzy's current products. This suggests that they are more likely to try the new energy drink line and become loyal customers. The other answer choices do not provide as strong of a justification for targeting female professionals over young males.

Question 18

Macmoo Real Estate is beginning to use data-driven processes to determine the value that it gets from different marketing activities. Macmoo's website lists available properties and allows customers to request information. Macmoo tends to advertise in local newspapers and specialized real estate periodicals. The marketing director believes that Macmoo's traditional spring advertising campaign, which runs during the month of March, is an effective use of advertising resources. When pressed for evidence, the marketing director points out that revenues in March have consistently been higher than revenues in February. Which of the following, if true about the real estate industry in general, would weaken the marketing director's argument?
A) The demand for houses is higher than it was last year.
B) The supply of houses for sale is lower than it was last year.
C) Sales are generally higher in March than in February.
D) Sales are generally higher in April than in March.
E) In February, home loan interest rates dropped.

Accepted Answer

C indicates that the observed increase in sales during March is a general trend in the real estate industry, not necessarily a result of Macmoo's advertising campaign.

Question 19

Leif designs and sells surfboards. Although his sales are declining, he decides to keep his prices constant. Which of the following statements, if true, would support Leif's decision?
A) Surfboards at other shops in the region are priced lower.
B) Customers rate Leif's surfboards as being of about average quality.
C) Demand for surfboards has been declining for several years.
D) Leif offers a much wider variety of surfboards than his competitors do.
E) Leif has calculated that lowering prices would reduce profits.

Accepted Answer

Since Leif has calculated that lowering prices would reduce profits, it would make sense for him to keep his prices constant even if sales are declining. This means that he is maximizing his profit margin and not sacrificing it to try to increase sales. The other options (A, B, C, and D) do not directly support Leif's decision to keep his prices constant.

Question 20

Macmoo Real Estate is beginning to use data-driven processes to determine the value that it gets from different marketing activities. Macmoo's website lists available properties and allows customers to request information. Macmoo tends to advertise in local newspapers and specialized real estate periodicals. The marketing director believes that Macmoo's traditional spring advertising campaign, which runs during the month of March, is an effective use of advertising resources. When pressed for evidence, the marketing director points out that revenues in March have consistently been higher than revenues in February. During 2013, Macmoo completed fewer real estate transactions than it did during any similar time period during the last five years. Still, the marketing director claims that its marketing efforts led to very positive financial results for Macmoo. Which of the following, if true, would resolve this seeming discrepancy?
A) In 2013, Macmoo spent more on advertising than it did in 2012.
B) In 2013, Macmoo diverted marketing efforts to support several corporate social responsibility initiatives.
C) Sales projections completed in 2010 predicted even lower sales volume in 2011.
D) In 2013, marketing efforts focused on sales of very expensive properties.
E) In 2013, Macmoo's principal competitors cut back on their marketing expenditures.

Accepted Answer

The fact that Macmoo completed fewer real estate transactions in 2013 than in any similar time period during the past five years is inconsistent with the marketing director's claim that their marketing efforts led to very positive financial results. However, if the marketing efforts in 2013 focused on sales of very expensive properties, this would explain the discrepancy. Selling even a few very expensive properties could result in significant financial gains, even if overall transaction volume is lower.

Quiz 12: Understanding Marketing Principles and Developing Products

Leif designs and sells surfboards. Although his sales are declining, he decides to keep his prices constant. Which of the following statements, if true, would support Leif's decision?