Deck 2: The Structure of the Advertising and Promotion Industry Advertisers Agencies Media and Support Organizations

Question 1

It is common for social organizations to advertise at the national, state, and local levels.

Answer 1

True

Question 2

Trade resellers of consumer products and services are the most prominent users of advertising and promotion.

Answer 2

False

Question 3

A creative boutique's niche expertise can be its greatest liability if the creative boutique is an extra expense that
advertisers cannot afford.

Answer 3

True

Question 4

Advertisers cannot function without the services of external facilitators.

Question 5

Digital/interactive agencies are those that have expertise in preparing communications for new media, such as the
Internet, mobile marketing, and interactive television.

Question 6

The creative boutique's greatest advantage is its niche expertise.

Question 7

Caltec Inc.has a department that is responsible for coming up with ideas and innovative ways to advertise the company's products in newspaper ads and billboards.This is an example of a full-service agency.

Question 8

Advertisers focusing on integrating more tools into promotional efforts has resulted in an enhanced role of traditional media.

Question 9

The idea behind crowdsourcing is to prevent ideas about a new brand from becoming public to consumers.

Question 10

Media fragmentation is a big plus for consumers but a disadvantage for advertisers and agencies.

Question 11

The advertising used by social organizations has a fundamentally different purpose compared to the advertising carried out by major multinational corporations.

Question 12

The goal of creating persuasive communication is to attract attention and develop preference for a brand.

Question 13

Advertisers include business organizations, but exclude not-for-profit organizations.

Question 14

The underlying role and purpose of advertising and promotion has changed drastically and will continue to change.

Question 15

Despite the explosion of new media in recent years, today's media options have reduced from those available
during the past decades.

Question 16

Blogs have emerged as sophisticated sources of brand and product information.

Question 17

At the local level, small retail shops deal only with household customers.

Question 18

Due to the backlash against advertising that clutter can cause, advertisers are integrating more tools within the overall promotional effort to reach more consumers in different ways.

Question 19

The simplest example of Web 2.0 is when consumers log on to the Internet and visit sites they choose to visit for either information or shopping.

Question 20

Retailers that sell in national or global markets are the most visible reseller advertisers and promotion users.

Question 21

has become a media conglomerate on the Web and amasses its own media empire of diverse Internet sites.

A)ABC broadcasting network
B)Facebook
C)Dell
D)InterActiveCorp

Question 22

Database consultants are particularly useful in planning coupon or direct mail campaigns.

Question 23

Under the commission system, the rate of commission is raised to 25 percent for outdoor media.

Question 24

Which of the following is true of crowdsourcing?

A)It refers to managing the supply chain system in a way that will most effectively reach the target markets.
B)It aims at getting consumers more involved with and committed to a brand.
C)It indicates the process of describing the firm's objectives for the brand in the near term and long term.
D)It refers to passive, intrusive advertising.

Question 25

A typical markup charge for outside services is five to ten percent.

Question 26

It is mandatory for designers and graphic specialists to be involved in strategy planning.

Question 27

A fee system is much like that used by consultants or attorneys, whereby the advertiser and the agency agree on an hourly rate for different services provided.

Question 28

has emerged as the most significant form of consumer control over information creation and communication.

A)Web advertising
B)Social media
C)Interactive television
D)Direct marketing

Question 29

A disadvantage of using media specialists is that they buy media in small quantities.

Question 30

Which of the following advertisement tools would be best suited for a regional application?

A)Podcasts
B)Internet advertisements
C)Television advertisements
D)Coupons and samples

Question 31

Advertisers do not like to handle their own public relations tasks because it requires highly specialized skills and talent not normally found within the company ranks.

Question 32

With media clutter and fragmentation,:

A)advertisers are developing a lack of faith in advertising alone.
B)the probability of any one advertisement making a real difference has increased manifold.
C)there are very few media choices available to advertisers.
D)promotion options are no longer attractive to advertisers.

Question 33

is used by organizations to get consumers committed to brands in a way that passive advertising cannot.

A)Co-op advertising
B)Phishing
C)Crowdsourcing
D)Broadcasting

Question 34

Advertisers are also known as by their advertising and promotion agency partners.

A)consultants
B)facilitators
C)sponsors
D)clients

Question 35

The task of strategic coordination of media and promotional efforts has become simpler because of the proliferation of media options and extensive use of promotional tools beyond advertising.

Question 36

Radio and satellite are examples of broadcast media.

Question 37

Websites frequented by individuals with common interests where they can post facts, opinions, and personal experiences are known as .

A)paywalls
B)blogs
C)infomercials
D)creative boutiques

Question 38

Firms that maintain and manage large databases of mailing lists are known as digital/interactive agencies.

Question 39

The four most prevalent agency compensation methods are commission, consultant, external facilitator, and production facilitator plans.

Question 40

Individuals collectively creating and sharing content through blogs, social media, wikis, and video sites is referred to as _____.

A)a commission system
B)broadcasting
C)Web 2.0
D)interactive production

Question 41

Which of the following services of an advertising agency involves expressing the benefits of a company's brand in interesting and memorable ways?

A)Creative services
B)Billing services
C)Administrative services
D)Media buying services

Question 42

A compensation system that adds a percentage amount to a variety of services the agency purchases from outside suppliers is known as a .

A)markup charge
B)fee system
C)pay-for-results compensation
D)commission system

Question 43

Which of the following services in an advertisement firm involves taking creative ideas and turning them into advertisements, direct mail pieces, and other IBP materials?

A)Administrative services
B)Creative services
C)Account services
D)Production services

Question 44

are specialists that design and then operate contests, sweepstakes, special displays, or coupon campaigns for advertisers.

A)Creative boutiques
B)Sales promotion agencies
C)Database agencies
D)Fulfillment centers

Question 45

are experts in designing incentive programs, point-of-purchase materials, and in-store merchandising.

A)Database agencies
B)Sales promotion agencies
C)Fulfillment centers
D)Event-planning agencies

Question 46

Though many agencies no longer use the traditional commission system for compensation, Starr Agency does. Using the standard percentage rate, how much would Starr Agency receive for a bill of $500,000?

A)$150,00
B)$125,000
C)$100,000
D)$75,000

Question 47

In which of the following areas is the federal government's spending on advertising and promotion concentrated?

A)The internal revenue services
B)Political campaigns
C)Armed forces recruitment
D)Trade and commerce

Question 48

PinBall Inc.sought the help of Blazer Corp.to help them reach a niche group of vendors that they have been trying to do business with.Blazer offers the solution of publishing an advertisement in a trade journal which would help create awareness about the firm's product.In this scenario, Blazer Corp.specializes in .

A)the management of databases
B)creative services
C)consumer sales promotions
D)trade-market sales promotions

Question 49

The graphic mark that identifies a company is known as a(n) .

A)patent
B)blog
C)logo
D)slogan

Question 50

Barlow and Baley Inc., an advertisement agency, has been approached by Crescent Corp.to help promote their new line of air conditioners.Barlow and Baley Inc.have advised Crescent Corp.that newspaper and television ads will be the best promotional tool for the product.They have also created a demo ad for the product.Barlow and Baley Inc.is an example of a(n) .

A)full-service agency
B)in-house agency
C)interactive agency
D)database consultant

Question 51

Which of the following modes of advertisement do wholesalers and retailers prefer to utilize?

A)Personal selling
B)Branded entertainment
C)Radio advertisements
D)Infomercials

Question 52

Bedwick Resorts has acquired the services of Elegant Inc.to develop advertisements for their organization.Elegant Inc.has advised them to add a panoramic view to billboard ads and portray tourists lounging by the sea.Elegant
Inc)is an example of a(n) .

A)media specialist
B)creative boutique
C)digital/interactive agency
D)in-house agency

Question 53

entail identifying the benefits a brand offers, its target audiences, and the best competitive positioning, and then developing a complete plan.

A)Administrative services
B)Creative services
C)Account services
D)Media planning and buying services

Question 54

A(n) is often known as the advertising department in a firm.

A)creative boutique
B)full-service agency
C)interactive agency
D)in-house agency

Question 55

A(n) coordinates the research effort of an advertisement agency.

A)graphic designer
B)media specialist
C)account planner
D)fulfillment center

Question 56

The most visible reseller advertisers and promoters are:

A)retailers who deal solely with household consumers.
B)retailers that sell in national or global markets.
C)those who sell at the local level.
D)those who cater to regional markets.

Question 57

are experts in finding locations, securing dates, and putting together a team of people to pull off a promotional activity.

A)Event-planning agencies
B)Creative boutiques
C)Fulfillment centers
D)Direct marketing agencies

Question 58

help firms in creating the visual impression of its advertising material.

A)Sales promotion agencies
B)Fulfillment centers
C)Designers
D)Bloggers

Question 59

Which of the following acts as a support to direct marketing agencies and follow-up on the delivery of their direct mail?

A)Creative boutiques
B)In-house agencies
C)Media specialists
D)Fulfillment centers

Question 60

Which of the following best describes digital agencies?

A)They focus on ways to use Web-based solutions for direct marketing and target market communications.
B)They implement direct response campaigns using all forms of media.
C)They design direct marketing campaigns that mainly use emails and telemarketing.
D)They specialize in buying media time and space and offer media strategies to advertisement agencies.

Question 61

McMann and Young advertisers has been hired by Broadway Bicycles to assist with promotions for a chain of bicycle stores in Vermont.The agency has agreed that a certain level of awareness and interest in Broadway Bicycles will be generated in order to gain the sales targets the company desires, and they have agreed to be paid accordingly.This is an example of a system of compensation.

A)markup charge
B)commission
C)cost-plus
D)pay-for-results

Question 62

A regional fast food chain called Platters is interested in opening a restaurant in a new market.The company plans to hire the services of a firm to collect the data needed to expand into the new market.In such a scenario, which of the following firm's services would it hire?

A)A marketing research firm to conduct surveys to understand the potential market
B)An advertising agency to create innovative ads
C)A consultant to create message strategies and message themes
D)Media organizations for placing ads in broadcast and print media to create awareness for the restaurant

Question 63

Which of the following is an example of interactive media?

A)Banners
B)Electronic directories
C)Catalogs
D)CD-ROMs

Question 64

Ocean Waves Resorts wants to purchase land and construct a resort on the shorefront in San Clemente.Ocean Waves would also like to construct a golf course and needs help in understanding local regulations and zoning restrictions in the country.Which of the following companies should Ocean Waves hire to assist with the project?

A)A consulting firm
B)A creative boutique
C)A digital/interactive agency
D)A production facilitating firm

Question 65

Which of the following is an example of outdoor support media?

A)Podcasts
B)Billboards
C)Catalogs
D)Electronic directories

Question 66

Scenario 2-1
As one of the world's largest computer and technology developers, Dell, Inc.has never been a stranger to advertising.However, due to a consistent decline in market share, the Texas-based company is looking to overhaul its advertising efforts for the first time in years.In the past, Dell found success promoting its products as some of the most inexpensive computer products in the market.However, the company's new ad campaign, which will be targeted toward more high-end users, will make no mention of product price.The company is looking to reinvent its image and believes that the first step in doing so is to revamp its outdated advertising campaign.
(Scenario 2-1) Dell decides not to use a full-service advertising agency because it would like its own employees to take responsibility for the new ad campaign.However, full­service agencies do provide a number of advantages- one of these advantages is that they:

A)are always large, employing thousands of people.
B)can provide the physical facilities for broadcast production.
C)have an array of talented professionals to meet all the needs of a client.
D)are the only way to create an ad campaign.

Question 67

Advertisers and their agencies rely primarily on external facilitators for:

A)consumer research.
B)media buying.
C)assessing the effectiveness of promotional programs.
D)production processes.

Question 68

Which of the following is an example of premiums, a type of support media?

A)Transit
B)Cable
C)Calendars
D)Billboards

Question 69

Which of the following is an example of a fixed fee system of compensation?

A)15 percent of the total amount billed by XL Inc.was retained by Tesco advertisers as compensation for all costs in creating the advertisement.
B)Largo advertisers was paid $50,000 by their client based on the effect their ads had on the sale of the company's products.
C)Purple Corp.paid RL Designs $150,000 based on the positive responses it received for their promotions from their customers.
D)HK advertisers and their client agreed on which supplies, materials, travel costs, and other expenses will be reimbursed.

Question 70

Design Solutions has two television network channels and its monthly magazine, Bling, is the most popular fashion magazine in the country.It also has a number of websites for its television channels and online sports news.Design Solutions is an example of a .

A)creative boutique
B)media conglomerate
C)media specialist
D)digital/interactive agency

Question 71

Harper & Kane advertising agency sets an hourly rate for the services it provides to its clients.This rate is based on the average salary of all the members in the creative department.Harper & Kane uses the system.

A)commission
B)cost-plus
C)markup charge
D)fee

Question 72

Carmel Inc.has come up with the idea of creating a television ad for its new range of assorted cookies.The marketing executives approached RT Designs who will be filming the ad, preparing a set to record the ad, and employing an actress to play the role of a little girl enjoying her cookies.RT Designs is an example of a .

A)creative boutique
B)production house
C)fulfillment center
D)media specialist

Question 73

CloudNine, an advertisement agency, charged Sparkles Inc.$50,000 at the rate of $5,000 an hour for the ten hours it spent designing an advertisement for the firm's new product launch ad.Which of the following systems of compensation did CloudNine utilize?

A)A fee system
B)A commission system
C)A markup charge system
D)A pay-for-results system

Question 74

is one of the world's largest media conglomerates and provides broadcasting, film, music, cable, print,
Publishing, and a dominant Internet presence.

A)News Corp
B)Fox Broadcasting Company
C)Sony Corporation
D)Time Warner

Question 75

Which of the following best describes a media conglomerate?

A)It is a firm that operates multiple media combinations.
B)It is a firm that is a specialist in one particular form of media.
C)It is a firm that specializes solely in buying media time and space.
D)It is a firm that uses print media instead of broadcast media

Question 76

Kowalski and Associates has been a successful mid-sized, full-service advertising agency for more than two decades.In an attempt to serve its clients more efficiently in a competitive marketplace, the agency has changed its compensation package to include payments based on results.In such a scenario, compensation packages for Kowalski and Associates are likely to be based on:

A)brand recognition.
B)workforce strength.
C)competitive advantage.
D)economies of scale.

Question 77

A compensation system that is based on the achievement of specific objectives of the client is known as a .

A)pay-for-results compensation
B)a markup charge
C)commission system
D)fee-based system

Question 78

is a high-speed technology that allows consumers to customize their programming and target very specific audiences.

A)Transit
B)Crowdsourcing
C)Broadband
D)Cable

Question 79

Scenario 2-1
As one of the world's largest computer and technology developers, Dell, Inc.has never been a stranger to advertising.However, due to a consistent decline in market share, the Texas-based company is looking to overhaul its advertising efforts for the first time in years.In the past, Dell found success promoting its products as some of the most inexpensive computer products in the market.However, the company's new ad campaign, which will be targeted toward more high-end users, will make no mention of product price.The company is looking to reinvent its image and believes that the first step in doing so is to revamp its outdated advertising campaign.
(Scenario 2­1) In order to reinvent the company's image, Dell puts together a team comprising members from its marketing department who will be responsible for every aspect of the advertising campaign.The company decides that involving employees in the campaign will allow it to maximize the profits generated from the new campaign.This team will be an example of a(n):

A)creative boutique.
B)full-service advertising agency.
C)fulfillment center.
D)in-house agency.

Question 80

provide the physical facilities, including sets, stage equipment, and crews needed for broadcasting.

A)Production houses
B)Creative boutiques
C)Fulfillment centers
D)Interactive agencies