Question 1

Which prospective customers are least likely to respond to a direct marketer's offering?

Accepted Answer

New contacts are unfamiliar with the brand and may not trust the direct marketer's offering yet. Nonrespondents are people who have previously received direct marketing offers but have not responded, indicating that they are not interested. Therefore, these two groups are the least likely to respond to a direct marketer's offering.

Question 2

Multichannel retailing is an example of what form of market segmentation strategy?

Accepted Answer

Multichannel retailing involves offering products through multiple channels such as online, brick-and-mortar stores, and mobile apps, catering to different segments of customers with different preferences. This is an example of a differentiated market segmentation strategy, where the retailer targets multiple segments with different marketing mixes.

Question 3

Low costs to develop and maintain a catalog or Web site,the ability to outsource order fulfillment operations,and low inventory needs all contribute to ________.

Accepted Answer

The low costs to develop and maintain a catalog or website, the ability to outsource order fulfillment operations, and low inventory needs make it easier for new companies to enter the direct marketing industry, resulting in low barriers to entry for direct marketing. This means more competition in the market, rather than a low level of competition. The 30-day rule of the Federal Trade Commission is unrelated to these factors and does not affect them. Thus, option C is correct.

Question 4

A firm uses both direct selling as well as department store formats to sell its cosmetic products.This illustrates ________.

Accepted Answer

The firm using both direct selling and department store formats to sell its cosmetic products illustrates multichannel retailing, where a company uses multiple distribution channels to reach customers. This approach allows the firm to cater to various customer preferences and increase its overall reach and sales.

Question 5

A direct marketer can effectively cater to a highly specialized niche market through use of a(n)________.

Accepted Answer

A specialog is a catalog that is tailored to a specific group or interest. By using a specialog, a direct marketer can effectively cater to a highly specialized niche market by focusing on the specific interests and needs of the target audience. Search engines and infomercials may reach a broad audience, while selective binding is not a common marketing strategy.

Question 6

The most valuable asset of a highly profitable direct marketer is generally its ________.

Accepted Answer

Owned mailing lists are a direct marketer's most valuable asset because they provide the ability to reach previously identified and engaged customers, who are more likely to make a purchase. Rented mailing lists are generally less valuable because the marketer has no prior relationship or knowledge of the recipients, and there is no history of engagement or response rates. Employees and inventory are important resources, but they are not as directly related to direct marketing success as a quality mailing list.

Question 7

Which lifestyle trend increased the desirability of direct marketing for consumers?

Accepted Answer

The lifestyle trend of poverty-of-time (consumers feeling like they have less time) increases the desire for convenience, making direct marketing a more appealing option for consumers who don't have the time to shop in stores.

Question 8

Infomercials are ideally suited for ________.

Accepted Answer

Infomercials are typically longer advertisements that allow for a more in-depth explanation of a product and its benefits, making them ideal for products that are not widely available and require a demonstration to showcase their effectiveness.

Question 9

The handling of merchandise,including addressing,mailing,and billing customers is often conducted by third-party service providers on a fee basis.These firms are called ________.

Accepted Answer

Third-party service providers that handle merchandise, including addressing, mailing, and billing customers on a fee basis, are typically referred to as order fulfillment firms. These firms specialize in managing and executing the operational aspects of the order fulfillment process, from picking, packing, and shipping orders to providing customer support and handling returns, thereby enabling businesses to focus on their core competencies.

Question 10

Many direct marketers used to order merchandise after orders were placed by consumers.Now,they place orders in anticipation of demand.This change in strategy is largely due to ________.

Accepted Answer

The "30-day rule" refers to the time it takes for merchandise to be ordered, delivered and processed for customers, which is the maximum acceptable wait time for most consumers. By ordering in anticipation of demand, direct marketers can meet this 30-day rule and ensure timely delivery to customers.

Question 11

Direct selling is not considered part of direct marketing since ________.

Accepted Answer

Direct selling involves face-to-face communication between the salesperson and the customer to initiate contact, while direct marketing uses advertising, email, direct mail, and other media to reach consumers. Therefore, personal communication is used to initiate customer contact in direct selling, which is not the case in direct marketing.

Question 12

A direct marketer determines the goods and services sold as well as its target market in the ________ stage of a direct marketing strategy.

Accepted Answer

In the business definition stage of a direct marketing strategy, the marketer determines what goods and services will be offered and decides on the target market for those offerings. This stage is critical for setting the direction of the overall strategy and ensuring that the company is focused on delivering products and services that will resonate with its intended audience.

Question 13

The "30-day rule" most directly relates to which stage of a direct marketing strategy?

Accepted Answer

The "30-day rule" is related to order fulfillment, ensuring that orders are processed and delivered within 30 days.

Question 14

A fishing specialties retailer concerned about the quality of a list of fly fishermen enthusiasts seeks to test a mailing list broker's mailing list.The retailer should ________.

Accepted Answer

Renting a mailing list allows the retailer to use the list for a specific campaign without making a long-term commitment. This way, the retailer can test the effectiveness of the list before making a purchase or developing its own list.

Question 15

A direct marketer can reduce its order fulfillment responsibilities by ________.

Accepted Answer

Retaining a third party order fulfillment service provider allows the direct marketer to outsource the entire order fulfillment process, including warehousing, picking, packing and shipping of orders. This reduces their operational responsibilities and costs, while increasing their efficiency and scalability. Using a public or private warehouse would still require the direct marketer to manage their own order fulfillment processes, and using a bonded warehouse would only be necessary for specific types of products.

Question 16

Which prospective customers are most likely to respond to a direct marketer's offering?

Accepted Answer

The answer of Which prospective customers are most likely to...

Question 17

A direct marketer determined that its customers' high levels of dissatisfaction with the firm concerned late delivery,the wrong items being delivered,or items arriving in defective condition due to being damaged in transit.These complaints concern which direct marketing strategy?

Accepted Answer

The complaints regarding late delivery, wrong items being delivered, or items arriving in defective condition are related to order fulfillment, which involves the entire process of receiving, processing, and delivering orders to customers.

Question 18

The promotional strategy of most infomercials ________.

Accepted Answer

Infomercials often create a sense of urgency by encouraging consumers to act immediately and offering limited-time specials. This tactic is intended to increase impulse buying and drive up sales.

Question 19

A direct marketer's selling advertising space to noncompeting firms in its catalogs most closely resembles ________.

Accepted Answer

Leased departments are sections within a retail store that are rented out to noncompeting firms to sell their products. Similarly, a direct marketer selling advertising space to noncompeting firms in its catalogs can be seen as renting out space for those firms to promote their products to the direct marketer's customers. Vertical cooperative advertising involves two or more firms in the same supply chain jointly promoting their products, an infomercial is a form of television advertising, and a regional edition refers to a publication tailored to a specific geographic location.

Question 20

While a direct marketer's overall response rate is good,its average purchase amount per catalog is below average.Most of its orders were placed by phone.The direct marketer should ________.

Accepted Answer

Training telephone personnel to cross-sell merchandise can increase the average purchase amount per catalog, as well as increase overall sales. Utilizing smaller catalogs for new contacts or larger catalogs for regular customers may have an impact on response rates but may not necessarily increase purchase amounts. Encouraging customers to mail in their orders may not necessarily address the issue of low average purchase amounts per catalog.

Quiz 6: Web, nonstore-Based, and Other Forms of Nontraditional Retailing