Deck 12: Marketing Channels: Delivering Customer Value

Question 1

Which of the following is an indirect business marketing channel?

A) producer to retailer to business distributor
B) producer to wholesaler to retailer to end consumer
C) producer to end-consumer to business distributor
D) producer to retailer
E) producer to business distributor to business customer

Answer 1

E

Question 2

The term demand chain is considered limited because it ________.

A) advocates a make-and-sell view of the market that relies on a responsive supply network
B) suggests that planning starts with raw materials, productive inputs, and factory capacity
C) takes a step-by-step, linear view of purchase-production-consumption activities
D) ignores the evolution of the global marketplace
E) overlooks the needs of target customers

Answer 2

C

Question 3

At its most basic form, a marketing channel consists of the producer and the ________.

A) retailer
B) sales agent
C) competitor
D) processor
E) consumer

Answer 3

E

Question 4

Which of the following is most likely true of marketing channel decisions?

A) They often involve long-term commitments to other firms.
B) They have minimal influence on the prices of products offered to customers.
C) They increase the amount of time a company spends connecting with customers.
D) They increase the amount of effort a company puts in to distribute goods.
E) They are easily altered, replaced, or discarded.

Question 5

A ________ is a layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer.

A) product platform
B) channel level
C) resource bank
D) contact center
E) customer franchise

Question 6

A ________ is made up of the company, suppliers, distributors, and customers who partner to improve the performance of the entire system.

A) value delivery network
B) horizontal channel
C) consumer base
D) product delivery network
E) product line

Question 7

Which of the following companies uses a direct marketing channel?

A) Fishhooks, a factory that manufactures fishing equipment that it ships to hobby stores worldwide
B) Germfight, a factory that manufactures dental products that it distributes only to select department stores
C) Apple Blossoms, a company that sells its cosmetics exclusively through Ray's Retail Store
D) Holly Wreaths, a store that sells Christmas ornaments to customers via its online click-to-order catalogs
E) Showdown, a clothing store that stocks merchandise from different international brands

Question 8

The sets of firms that supply companies with the raw materials, components, parts, information, finances, and expertise needed to create products or services are known as ________.

A) retailers
B) upstream partners
C) distributors
D) downstream partners
E) distribution channels

Question 9

A ________ is a set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business user.

A) product line
B) product delivery network
C) marketing channel
D) consumer base
E) resource bank

Question 10

Which of the following is a conventional consumer marketing channel?

A) producer to business distributor to end consumer
B) producer to wholesaler to retailer to end consumer
C) producer to end consumer to business customer
D) producer to retailer
E) producer to business distributor to business customer

Question 11

A marketing channel that consists of one or more intermediaries is known as a(n) ________ marketing channel.

A) cyclic
B) upstream
C) looped
D) direct
E) indirect

Question 12

Plasticine Palace supplies its products exclusively to Arts & Crafts, a chain of stationery stores across the country. The chain then makes the plasticine available to end consumers. This is an example of ________.

A) a direct marketing channel
B) intensive distribution
C) an indirect marketing channel
D) disintermediation
E) extensive distribution

Question 13

Which of the following is an example of an indirect marketing channel?

A) June Bride, which sells bridal gowns via its click-to-order online catalogs
B) Farmer Brown, who delivers fresh milk from his dairy to customers every morning
C) Wine & Dine, which sells its picnic baskets to select novelty stores across the country
D) Lifebelt Insurance, which sells life insurance through its door-to-door salespeople
E) Rhonda's Rental, which rents cars to people for the day

Question 14

Which of the following terms refers to the wholesalers and retailers that form a vital link between the firm and its customers?

A) factory-supply networks
B) downstream partners
C) resource banks
D) upstream partners
E) supply channels

Question 15

The greater the number of channel levels in a marketing channel, the ________.

A) less distance between producer and end-consumer
B) greater the channel complexity
C) less time it takes for products to reach end-consumers
D) greater the control producers have over the distribution of their products
E) greater the control producers have over the demand of their products

Question 16

Lifebelt Insurance sells insurance only through its door-to-door salespeople. What type of marketing channel does Lifebelt use?

A) inclusive
B) multitiered
C) indirect
D) direct
E) selective

Question 17

The term supply chain is considered limited because it ________.

A) ignores the make-and-sell aspect of the market
B) suggests that planning begins with raw materials and factory capacity
C) takes a step-by-step, linear view of purchase-production-consumption activities
D) takes a sense-and-respond view of the market
E) suggests that planning starts with identifying the needs of target customers

Question 18

In a(n) ________ channel, the same member both produces and distributes a product or service to consumers.

A) tiered
B) direct
C) platform
D) vertical
E) exclusive

Question 19

From the economic system's point of view, the role of ________ is to transform the assortments of products made by producers into the assortments wanted by consumers.

A) upstream partners
B) marketing intermediaries
C) third-party logistics
D) price consultants
E) factory supervisors

Question 20

________ play an important role in matching supply and demand by providing consumers with a broad assortment of products in small quantities.

A) Virtual banks
B) Intermediaries
C) Price consultants
D) Uniform-delivery networks
E) Upstream partners

Question 21

Conflict that occurs between different levels of the same marketing channel is known as ________ conflict.

A) horizontal
B) vertical
C) multitiered
D) equilateral
E) communal

Question 22

Downstream marketing channel partners, such as wholesalers and retailers, form a vital link between the firm and its customers.

Question 23

Provide an example of a company that has used an imaginative distribution system to gain a competitive advantage.

Question 24

Refer to the scenario below to answer the following question(s).
Giant Beanstalks is a company based in Maryland that processes and cans vegetables. It has contracts with several large farms in Riverdale, 80 miles away from the factory, that agree to sell their produce to Giant Beanstalks. The company's products are available to the public only through Greenleaf, a grocery chain with 38 stores in the country.
Which of the following is Giant Beanstalks' upstream partner?

A) the management of Greenleaf
B) the farmers of Riverdale
C) the trucks that carry Giant Beanstalks' products to Greenleaf
D) the end-consumers who buy the canned vegetables from Greenleaf
E) the logistics division of Giant Beanstalk

Question 25

Conflict that occurs among firms at the same level of the marketing channel is known as ________ conflict.

A) multitiered
B) horizontal
C) vertical
D) prolonged
E) financial

Question 26

Producers use intermediaries because they create greater efficiency in making goods available to target markets.

Question 27

The number of products supplied indicates the length of a channel.

Question 28

When KFC came into conflict with its franchisees over the brand's Unthink KFC repositioning, which emphasized grilled chicken over its traditional Kentucky fried chicken, KFC experienced ________ conflict.

A) equilateral
B) vertical
C) multitiered
D) communal
E) horizontal

Question 29

How do intermediaries add value to a marketing system?

Question 30

In a direct marketing channel, the producer sells directly to the intermediaries, who in turn sell directly to the customers.

Question 31

Each layer of marketing intermediaries that performs some work in bringing the product and its ownership closer to the final buyer is a channel level.

Question 32

Which of the following is true of channel members?

A) They act independent of each other.
B) They play specialized roles in the channel.
C) They are not accountable to other channel members.
D) They play generalized and interchangeable roles in the distribution process.
E) Their competence and cooperation don't affect the company's image or profits.

Question 33

The management of two Panizza restaurants has an ongoing disagreement over the discount rate given to students from the local high school. This is an example of ________ conflict.

A) intensive
B) selective
C) exclusive
D) horizontal
E) vertical

Question 34

The role of marketing intermediaries is to transform the assortments of products made by retailers into the assortments wanted by producers.

Question 35

Managers at the Imperial Hotel-Chicago complained that the chain's overall image was hurt because Imperial Hotel-Dallas was overcharging guests and providing poor service. The Imperial Hotel was experiencing ________ conflict.

A) equilateral
B) vertical
C) multitiered
D) communal
E) horizontal

Question 36

________ are complex behavioral systems in which people and companies interact to accomplish individual, company, and channel goals.

A) Customer relationship management systems
B) Distribution channels
C) Partner relationship systems
D) Consumer bases
E) Buying centers

Question 37

Why is the term value delivery network a more relevant expression to use than the term supply chain or demand chain ?

Question 38

Which of the following is a type of flow that connects all institutions in a marketing channel?

A) payment flow
B) ownership flow
C) physical flow
D) promotion flow
E) information flow

Question 39

A company's channel decisions directly affect the prices of its products.

Question 40

What are the key functions that members of the marketing channel perform?

Question 41

Which of the following is a major type of vertical marketing system?

A) corporate
B) conventional
C) multilevel
D) intrinsic
E) extrinsic

Question 42

A ________ VMS integrates successive stages of production and distribution under single ownership.

A) contractual
B) corporate
C) contingency
D) conventional
E) communal

Question 43

Which of the following is most likely a manufacturer-sponsored retailer franchise system?

A) international fast food chains like McDonald's and Pizza Hut
B) Starbucks outlets operating within Target stores
C) Toyota and its network of independent franchised dealers
D) licensed bottlers that bottle and sell soft drinks to retailers
E) hotel chains like the Ritz Carlton and Shangri-La

Question 44

In a(n) ________, leadership is assumed not through common ownership or contractual ties but through the size and power of one or a few dominant channel members.

A) horizontal marketing system
B) administered VMS
C) corporate VMS
D) contractual VMS
E) conventional VMS

Question 45

In a(n) ________, two or more companies at one level join together to follow a new marketing opportunity.

A) administered vertical marketing system
B) horizontal marketing system
C) corporate vertical marketing system
D) hybrid distribution system
E) conventional marketing system

Question 46

A ________ VMS consists of independent firms at different levels of production and distribution who join together through formal agreements to obtain more economies or sales impact than each could achieve alone.

A) corporate
B) contingency
C) contractual
D) communal
E) conventional

Question 47

Movie Giants offers DVD rentals through its Web site. It also offers DVD rentals via Star City stores. This is an example of a(n)________ distribution system.

A) conventional
B) inclusive
C) intensive
D) extensive
E) multichannel

Question 48

When McDonald's offers its products inside of a Walmart store, it is using a(n) ________.

A) conventional marketing system
B) corporate VMS
C) contractual VMS
D) administered VMS
E) horizontal marketing system

Question 49

Which of the following is true of conventional distribution channels?

A) Channel members have complete control over each other.
B) Channel members seek to maximize their own profits.
C) Channel conflict is governed by formal mechanisms.
D) Channel members are assigned roles according to a clearly defined framework.
E) Channel members work exclusively for the good of the organization.

Question 50

Which of the following is an advantage of adding new channels in a multichannel distribution system?

A) limiting market complexity
B) reducing control over the system
C) expanding sales and market coverage
D) decreasing marketing needs and costs
E) minimizing mass customization of products

Question 51

Atlas Imports and Exports sells products directly to consumers via the Atlas Web site, and through local retailers as well. Which of the following is evident here?

A) corporate vertical marketing system
B) horizontal marketing system
C) multichannel distribution system
D) administered vertical marketing system
E) conventional distribution channel

Question 52

Stylize, Inc. opened an online store that triggered disagreements between headquarters and the firm's exclusive dealers. This type of a disagreement is known as a(n) ________ conflict.

A) vertical
B) indirect
C) horizontal
D) selective
E) multitiered

Question 53

________ VMS is a vertical marketing system that coordinates successive stages of production and distribution through the size and power of one of the parties.

A) Contingent
B) Administered
C) Corporate
D) Contractual
E) Aligned

Question 54

The ________ organization is the most common type of contractual relationship.

A) franchise
B) horizontal
C) conventional
D) multi-national
E) entrepreneurial

Question 55

A(n) ________ system involves a single firm setting up two or more marketing channels to reach one or more customer segments.

A) conventional distribution
B) corporate vertical marketing
C) horizontal marketing
D) administered vertical marketing
E) multichannel distribution

Question 56

A(n) ________ consists of one or more independent producers, wholesalers, and retailers, each seeking to maximize its own profits, sometimes even at the expense of the system as a whole.

A) multitiered supply chain
B) conventional distribution channel
C) intrinsic market matrix
D) resource bank
E) product platform

Question 57

Which of the following is true of vertical marketing systems?

A) Producers, wholesalers, and retailers act as a unified system.
B) Channel members have no control over each other.
C) Channel conflict is governed by informal mechanisms.
D) The system is dominated by the consumer.
E) Channel members work independently with no cooperation from other members.

Question 58

Fire Up makes fireproof clothing material and it licenses select stores around the world to use its material to make finished products with the Fire Up logo. Which of the following type of franchising is evident here?

A) manufacturer-sponsored retailer franchise system
B) manufacturer-sponsored wholesaler franchise system
C) service-firm-sponsored retailer franchise system
D) service-firm-sponsored equity strategic alliance
E) manufacturer-and-service-sponsored joint venture

Question 59

A(n) ________ marketing system consists of producers, wholesalers, and retailers acting as a unified system.

A) horizontal
B) vertical
C) multitiered
D) communal
E) equilateral

Question 60

Ford and its network of independent franchised dealers is an example of a ________.

A) manufacturer-sponsored retailer franchise system
B) manufacturer-sponsored wholesaler franchise system
C) service-firm-sponsored retailer franchise system
D) service-firm-sponsored equity strategic alliance
E) manufacturer-and-service-sponsored joint venture

Question 61

Compare a conventional distribution channel with a vertical marketing system (VMS).

Question 62

What is horizontal conflict? Illustrate your answer with an example.

Question 63

A conventional distribution channel consists of one or more independent producers, wholesalers, and retailers; each seeking to maximize its own profits, perhaps even at the expense of the system as a whole.

Question 64

Which of the following is true of changes in the organization of distribution channels?

A) Developing new channels seldom causes conflict with a company's established channels.
B) To remain competitive, product and service producers must use fewer marketing channels.
C) The growth of the Internet threatens many brick-and-mortar companies with disintermediation.
D) Companies have fewer channel-options today than they did in the past due to economic problems.
E) Advances in technology have decreased the number of channels available to entrepreneurial firms.

Question 65

A non-corporate VMS integrates successive stages of production and distribution under single ownership.

Question 66

How can a firm benefit from participating in a horizontal marketing system?

Question 67

Explain channel power in a vertical marketing system.

Question 68

Refer to the scenario below to answer the following question(s).
Giant Beanstalks is a company based in Maryland that processes and cans vegetables. It has contracts with several large farms in Riverdale, 80 miles away from the factory, that agree to sell their produce to Giant Beanstalks. The company's products are available to the public only through Greenleaf, a grocery chain with 38 stores in the country.
What distribution strategy does Giant Beanstalks use?

A) inclusive distribution
B) exclusive distribution
C) selective distribution
D) intensive distribution
E) extensive distribution

Question 69

What is vertical conflict? Illustrate your answer with an example.

Question 70

Vertical conflict occurs among firms at the same level of the channel.

Question 71

Give an example of a multichannel distribution system.

Question 72

What is a conventional distribution channel?

Question 73

The Bookworm began delivering books directly to customers through mail instead of selling through brick-and-mortar companies. This is an example of ________.

A) indirect marketing
B) disintermediation
C) franchising
D) exclusive distribution
E) intensive distribution

Question 74

________ occurs when product or service producers cut out intermediaries and go directly to final buyers or when radically new types of channel intermediaries displace traditional ones.

A) Extensive distribution
B) Multichannelization
C) Disintermediation
D) Inclusive distribution
E) Cross merchandising

Question 75

Disintermediation occurs when radically new types of channel intermediaries displace traditional ones.

Question 76

Which of the following is a disadvantage of adding new channels in a multichannel distribution system?

A) decreasing complexity of markets
B) decreasing control over the system
C) reducing opportunities for franchising
D) lowering sales and market coverage
E) minimizing publicity needs

Question 77

Horizontal conflicts are conflicts between different levels of the same channel.

Question 78

How can a firm benefit from involvement in a contractual VMS?

Question 79

In a vertical marketing system, two or more companies at one level join together to take advantage of a new marketing opportunity.

Question 80

What are the advantages of multichannel distribution systems?