Deck 10: Managing Channel Power

Question 1

How can a firm most likely retain its expert power in the long run?

A) keep channel members informed about channel performance
B) force channel partners to invest in specialized service outputs
C) invest in learning about market trends, threats, and opportunities
D) use mystery shoppers to monitor downstream channels
E) encourage channel partners to utilize multiple suppliers

Answer 1

C

Question 2

Power is best described as a(n)________.

A) cooperative arrangement
B) potential for influence
C) index of profitability
D) tough strategic tactic
E) act of free will

Answer 2

B

Question 3

What type of power involves giving a benefit in return for a channel member's agreement to alter its behavior?

A) reward
B) coercive
C) expert
D) referent
E) legitimate

Answer 3

A

Question 4

What is the most likely basis of traditional legitimate authority?

A) formal contracts
B) external rewards
C) legal traditions
D) internal values
E) public policies

Question 5

Which statement about coercive power is most likely FALSE?

A) Coercion involves making an implicit or explicit threat to another organization.
B) Coercive power is difficult to overcome because it stems from formal contracts.
C) Coercion tends to provoke self-defense responses from channel members.
D) Coercive power can be effective in the short run but not in the long run.
E) Coercion should be the last tactic used to evoke change in the channel.

Question 6

The French and Raven approach is a method used to ________.

A) accrue power
B) manage channels
C) measure power
D) identify channels
E) segment markets

Question 7

________ power is based on the target's perception that the influencer has special knowledge that is useful and that the target does not possess.

A) Reward
B) Coercive
C) Expert
D) Referent
E) Legitimate

Question 8

According to the text,what is the source of expertise power held by Farmacias Similares?

A) monopoly of Mexico's pharmaceutical firms
B) control of Mexico's health insurance system
C) influence over Mexico's public hospitals and clinics
D) knowledge of Mexico's drug market and regulations
E) ownership of most new medication patents in Mexico

Question 9

Mystery shoppers are most likely used by suppliers and retailers to ________.

A) retaliate against coercion
B) enforce legitimate power
C) gain marketplace expertise
D) identify employee strengths
E) compare promotional efforts

Question 10

What is the most common source of legal legitimate power in marketing channels?

A) contracts
B) utilities
C) brands
D) rewards
E) values

Question 11

Which type of power stems from a channel member's desire to identify with a prestigious organization?

A) reward
B) coercive
C) expert
D) referent
E) legitimate

Question 12

Which type of power comes from contracts,laws,and industry norms?

A) reward
B) coercive
C) expert
D) referent
E) legitimate

Question 13

How can a channel member most likely build legitimate power?

A) developing channel partnerships based on common values
B) selecting channel partners with unique operating methods
C) choosing channel partners that are independent minded
D) basing channel partnerships on subjective contracts
E) requiring channel partners to pay royalties and fees

Question 14

Farmacias Similares used its expertise power to ________.

A) sell branded medications to the government
B) import inexpensive, generic pharmaceuticals
C) develop a profitable health clinic network
D) sell safer versions of patented medications
E) create new sources of pharmaceutical supplies

Question 15

Which term refers to an overestimation of a channel member's ability to exert influence and make change happen?

A) false positive
B) reward power
C) false negative
D) value neutrality
E) double marginalization

Question 16

Which term refers to the ability to alter another organization's behavior?

A) channel dependence
B) legitimate power
C) coercive power
D) channel strategy
E) channel power

Question 17

All of the following were results of HP using its power to push assembly activities down the channel EXCEPT ________.

A) fewer stockouts
B) market expansion
C) mass customization
D) higher inventory levels
E) increased customer satisfaction

Question 18

What type of power involves negative sanctions for failing to conform to a channel member's expectations?

A) reward
B) coercive
C) expert
D) referent
E) legitimate

Question 19

Managers at SMX Clothing Manufacturer have decided to increase their wholesale prices to gain more revenue from Taylor's Tog Shop,an exclusive retailer for SMX clothing.To preserve the store's margins,the owner of Taylor's Tog Shop increases retail prices on SMX clothes,which leads to reduced demand.Which term best describes this situation?

A) coercion
B) dependence
C) false negative
D) value neutrality
E) double marginalization

Question 20

Z-Mart,the nation's top grocery store chain,requires suppliers to perform bulk breaking activities that vary from store to store.Bulk breaking is both costly and time consuming for suppliers,but the implied threat of being dropped from Z-Mart's approved vendor list influences suppliers to comply.What type of power is Z-Mart most likely using?

A) reward
B) coercive
C) expert
D) referent
E) legitimate

Question 21

How did Gore-Tex establish legitimate power?

A) patent protection
B) franchise agreements
C) industry norms
D) hierarchical authority
E) market experience

Question 22

Which method of measuring dependence focuses on how power is amassed?

A) percentage of profits
B) sales percentage
C) bottom-up approach
D) role performance
E) alternative scarcity

Question 23

Which statement about influence strategies is most likely FALSE?

A) The recommendation influence strategy tends to create skepticism.
B) A legalistic influence strategy is often perceived as heavy handed.
C) A request influence strategy is commonly used and not offensive.
D) High-pressure influence strategies are ineffective in the short-term.
E) Promise and threat influence strategies tend to provoke a backlash.

Question 24

Which statement about balancing power is most likely FALSE?

A) High mutual power gives channel members more ability to achieve high levels of value.
B) Channel outcomes rely on the balance of power in a given relationship.
C) Power is a property not of an organization but of the relationship.
D) Power assessments should focus on unmediated bases and costs.
E) Interdependence is synonymous with high mutual power.

Question 25

The valence of a frame refers to whether it is ________.

A) conveyed to upstream or downstream intermediaries
B) communicated as an influence strategy
C) based on reward or referent power
D) dependent on certain conditions
E) presented as a positive or a negative

Question 26

How has Gore-Tex most likely built its channel power over the last 30 years?

A) selling the material directly to end-users
B) relying on non-contingent appeals to retailers
C) investing in marketing to build brand awareness
D) partnering with designer dress clothing businesses
E) allowing the material to be used in private-label clothing

Question 27

What power source is necessary for a promise influence strategy to be effective?

A) reward
B) coercive
C) legitimate
D) reference
E) expertise

Question 28

The information exchange influence strategy is most likely problematic and risky because it is ________.

A) ineffective due to its subtlety
B) viewed as veiled criticism
C) damaging to channel morale
D) overly authoritative
E) psychologically stressful

Question 29

What was the primary cause of CNH Group losing market share?

A) CNH was ignoring the needs of its dealers.
B) CNH dealers were losing track of customer leads.
C) CNH offered customers a poorly designed website.
D) CNH was pricing its tractors higher than the competition.
E) CNH failed to invest adequately in tractor design and features.

Question 30

In an imbalanced relationship between a stronger party (A)and a weaker party (B),the weaker party is LEAST likely to ________.

A) develop a diversified portfolio
B) withdraw from the business
C) suffer from exploitation
D) bring in a third party
E) reduce service levels

Question 31

Every Toshiba laptop has an "Intel Inside" sticker near the keyboard.What type of power does Intel most likely have in this case?

A) reward
B) coercive
C) expert
D) referent
E) legitimate

Question 32

What influence strategy is best when a channel member has referent power?

A) promise
B) threat
C) request
D) information exchange
E) recommendation

Question 33

MKS Manufacturing is having difficulties with one of its downstream intermediaries.In order to influence the intermediary to make changes,MKS managers remind the intermediary of the terms of the contract.Which influence strategy is most likely being used by MKS?

A) threat
B) request
C) legalistic
D) recommendation
E) information exchange

Question 34

An imbalanced relationship will most likely function effectively when the ________.

A) weaker party develops a joint partnership
B) stronger party offers equitable treatment
C) weaker party withholds service outputs
D) stronger party exerts reward power
E) weaker party threatens to leave

Question 35

What is the most common reaction by weaker parties in imbalanced relationships?

A) leaving the business
B) increasing investments
C) accepting the situation
D) forming a strong coalition
E) diversifying its supplier network

Question 36

According to the text,the removal of something a channel member already has is defined as ________ power.

A) reward
B) coercive
C) mediated
D) noncoercive
E) unmediated

Question 37

Which statement about dependence is most likely true?

A) A highly dependent channel member has significant potential for influence.
B) Two-sided dependence is always balanced and free of power struggles.
C) Unlike power, dependence operates in only one channel direction.
D) Dependence equals utility multiplied by alternative scarcity.
E) A loyal channel member is highly dependent on its partners.

Question 38

Nike shoes are sold at retailers such as Foot Locker,Dick's Sporting Goods,and Sports Authority,but they are not sold in Wal-Mart or Target.What is Nike most likely trying to accomplish with this strategy?

A) monitor marketing channel intermediaries
B) create and preserve referent power
C) establish legitimate power
D) use coercive techniques
E) manage risk

Question 39

According to the text,Gore-Tex initially relied on ________ power to control distribution channels before building and using ________ power.

A) coercive; referent
B) reward; legitimate
C) referent; legitimate
D) coercive; reward
E) legitimate; referent

Question 40

How did CNH Group enhance its expert power?

A) providing product information on the firm's extranet
B) giving dealers new promotional tools to attract customers
C) eliminating unproductive dealers and consolidating profitable ones
D) generating leads for dealers using social media and the company website
E) providing dealers with market research to improve their competitiveness

Question 41

What is reward power? Why is it considered universally effective? Provide examples of reward power to illustrate your response.

Question 42

Legitimate power is based on the target's perception that the influencer has special knowledge or expertise that is useful and that the target does not possess.

Question 43

List the six communication strategies for converting channel power into influence and provide examples of each.What type of power is necessary for each type to work?

Question 44

Power refers to the ability of one channel member to get another channel member to do something it otherwise would not have done.

Question 45

When an imbalanced relationship is not functioning well,the weaker party should consider diversifying or exiting the business.

Question 46

What is channel power? Why is channel power necessary?

Question 47

What does a producer need to offer in order to accrue and exert power in the channel?

Question 48

Legitimate power can be built by choosing channel partners that are compatible in terms of attitudes,values,and operating methods.

Question 49

Differentiate between legal legitimate power and traditional legitimate power.Provide examples of each to illustrate your response.

Question 50

The most common and effective communication methods for converting power into influence are making promises and using threats.