Question 1

Emerson Electric most likely shifted to a service-based business model for the purpose of ________.
A) communicating more efficiently with key customers
B) adding new channel intermediaries to lower costs
C) competing better with overseas manufacturers
D) revising the vertical integration structure
E) supporting lifetime product warranties

Accepted Answer

Competing better with overseas manufacturers often requires companies like Emerson Electric to adapt their business models to focus on services, which can provide a competitive edge through differentiation and added value that is harder to replicate by manufacturers solely focused on product output.

Question 2

Which statement is most likely true about shifting from a product-based to a service-based business?
A) Adding services tends to decrease overall sales because a firm needs to increase its promotional spending.
B) Services require less integration and communication between supplier and customer, which increases profitability.
C) Services tend to cause an erratic flow of revenue because they are less resistant to economic cycles than products.
D) Services are typically onetime purchases, unlike products, which are purchased often.
E) Services increase the level of differentiation with competitive offerings.

Accepted Answer

Shifting from a product-based to a service-based business can increase the level of differentiation with competitive offerings. Services are often customized to meet the specific needs of individual customers, which can set a company apart from its competitors.

Question 3

How has the Internet been an "enabling technology" in the music industry?
A) increased demand for the services of local music retailers
B) removed the product aspect from music offerings
C) reduced the cost and ease of downloading music
D) increased the need for more intermediaries
E) consolidated the efforts of music retailers

Accepted Answer

B

Question 4

What is the best way a channel manager can adjust to higher levels of coproduction and inventory perishability in service settings?
A) shifting to a product-based business strategy
B) using CRM to monitor upstream channels
C) building hybrid channel structures
D) increasing e-commerce sales
E) outsourcing manufacturing

Accepted Answer

Building hybrid channel structures is the best way a channel manager can adjust to higher levels of coproduction and inventory perishability in service settings. This involves combining different types of channels, such as direct sales, online sales, and third-party sales, to create a more flexible and responsive channel system that can adapt to changing demands. This will allow the channel manager to better manage inventory levels and coproduction, while also avoiding stockouts and overproduction. Shifting to a product-based business strategy, using CRM to monitor upstream channels, increasing e-commerce sales, and outsourcing manufacturing may not be relevant or effective solutions in service settings.

Question 5

Which U.S.trend is significantly influencing marketing channel structures and strategies?
A) shift towards bricks-and-mortar retailing
B) demand for locally-made products
C) decreased need for service outputs
D) growth of the manufacturing sector
E) drive for globalization

Accepted Answer

The answer of Which U.S.trend is significantly influencing marketing channel...

Question 6

Which of the following best describes coproduction?
A) Production levels are maintained by upstream partners.
B) Customers need to be present at the point of production.
C) Intermediaries and customers influence service outputs.
D) Channel members monitor production quality and quantity.
E) Customer experiences influence service and production standards.

Accepted Answer

The answer of Which of the following best describes coproduction?
A)...

Question 7

Which concept refers to the inability to inventory services until they are needed?
A) sustainability
B) tangibility
C) homogeneity
D) perishability
E) heterogeneity

Accepted Answer

Perishability refers to the fact that services cannot be stored for future use, as they are consumed at the time they are produced. This can lead to challenges in managing supply and demand for services. Choice A (sustainability) refers to the ability to maintain or preserve resources over time, and is not directly related to the inventory of services. Choice B (tangibility) refers to whether a product or service can be physically touched or perceived by the senses, and is not directly related to the inventory of services. Choice C (homogeneity) refers to the degree of similarity among service offerings, and is not directly related to the inventory of services. Choice E (heterogeneity) refers to the degree of variability among service offerings, and is not directly related to the inventory of services.

Question 8

The fact that a service cannot be touched,seen,or patented refers to its ________.
A) perishability
B) tangibility
C) homogeneity
D) intangibility
E) heterogeneity

Accepted Answer

The fact that a service cannot be touched, seen or patented refers to its intangibility. Services are intangible in nature and cannot be seen, touched or felt like physical products.

Question 9

What is most likely a disadvantage of developing in-house service capabilities?
A) Service output demands are difficult to measure and implement very quickly.
B) An overlap of service and product divisions causes shareholder concerns.
C) Channel conflicts increase because of the loss of proprietary information.
D) Suppliers compete against channel partners for service delivery rights.
E) Formal joint partnerships lead to organizational culture problems.

Accepted Answer

The answer of What is most likely a disadvantage of...

Question 10

What is the most likely reason that a firm's channel strategy is affected when the firm no longer offers a physical product?
A) Intermediaries perform fewer traditional channel functions.
B) Upstream channel members alter production capabilities.
C) Additional service offerings require new intermediaries.
D) Effective supply chains rely on geographic proximity.
E) Service transition strategies rely on upstream channels.

Accepted Answer

When a firm no longer offers a physical product, intermediaries are likely to perform fewer traditional channel functions. For instance, intermediaries may not need to store, transport, or physically handle the product, since it is no longer a tangible good. As a result, the firm's channel strategy may need to be adjusted to reflect this new reality.

Question 11

Which of the following is LEAST likely a characteristic of services?
A) primarily intangible
B) homogenous nature
C) value through timeliness
D) value through convenience
E) consumable when produced

Accepted Answer

Services are typically heterogeneous in nature, meaning they can vary from one provider or experience to another. The other options are all common characteristics of services. Services are primarily intangible, meaning they cannot be touched or seen, but rather experienced. They often provide value through timeliness (e.g. quick shipping) or convenience (e.g. online ordering). Services are not typically consumable when produced like a physical good would be.

Question 12

What is a likely advantage of acquiring service capabilities,infrastructure,and knowledge by collaborating with an existing service provider?
A) reducing channel conflicts
B) streamlining the value chain
C) minimizing management complexities
D) communicating more with end-users
E) monitoring service outputs more closely

Accepted Answer

The answer of What is a likely advantage of acquiring...

Question 13

Most firms have added services to their current product offerings for the purpose of ________.
A) altering channel structures
B) improving competitiveness
C) meeting customer demands
D) expanding into foreign markets
E) improving value and supply chains

Accepted Answer

Adding services to product offerings helps firms improve their competitiveness by differentiating themselves from competitors and providing additional value to customers.

Question 14

Which term refers to the degree to which a firm's sales come from services?
A) capacity
B) service ratio
C) service output
D) channel power
E) return on investment

Accepted Answer

The term that refers to the degree to which a firm's sales come from services is the service ratio. The ratio measures the proportion of a company's overall revenue that is generated by its service offerings. It can be used to evaluate the level of dependence a company has on its service business and to assess the potential impact of changes in demand for those services on the company's overall revenue.

Question 15

VCW Enterprises manufactures small electronics and plans to start selling warranty services in the near future.VCW's financial performance will most likely increase dramatically once VCW earns at least ________ of its sales from services.
A) 5%
B) 20%
C) 40%
D) 55%
E) 70%

Accepted Answer

According to research, when a company earns at least 20% or more of its sales from services, their financial performance is likely to increase significantly. Therefore, option B is the best choice.

Question 16

According to the text,consumer electronics manufacturers are increasingly offering service warranties for their products to ________.
A) increase profit margins
B) comply with regulations
C) alter e-commerce strategies
D) eliminate channel conflicts
E) meet social responsibility demands

Accepted Answer

Offering service warranties can help manufacturers increase profit margins by adding value to their products and potentially generating additional revenue from warranty services.

Question 17

Which service characteristic is substantial,difficult to control,and highly dependent on an employee's delivery?
A) perishability
B) tangibility
C) homogeneity
D) intangibility
E) heterogeneity

Accepted Answer

Heterogeneity refers to the variability in the performance of services, which can be substantial and difficult to control, often depending on the individual employee delivering the service. This characteristic highlights the challenge in ensuring consistent service quality.

Question 18

What is the primary reason that many automobile manufacturers increased both dealership costs and service standards?
A) reduce heterogeneity among local car dealerships
B) encourage car buyers to purchase extended warranties
C) improve quality control at domestic automotive factories
D) discourage car dealers from selling multiple car brands
E) minimize the perishability of automotive inventories

Accepted Answer

Increasing dealership costs and service standards can help reduce heterogeneity among local car dealerships, ensuring a consistent customer experience across different locations. This can also help improve the brand's reputation and customer loyalty.

Question 19

According to the text,Johnson Controls' service division is large and fast growing because the firm________.
A) outsources service calls
B) customizes service solutions
C) uses multiple channel intermediaries
D) automates most production capabilities
E) sells most services through distribution networks

Accepted Answer

The text states that Johnson Controls' service division is growing rapidly because the firm "offers customized service solutions that can be tailored to clients' specific needs." This suggests that the division's success is due, at least in part, to its ability to provide personalized and flexible services to customers. None of the other answer choices are directly mentioned in the text or strongly implied as factors contributing to the division's growth.

Question 20

Madison Manufacturing makes small appliances and faces tough competition from overseas firms that make similar products less expensively.Madison managers have decided to offer more services to customers,such as maintenance agreements and warranty contracts.Madison now deals directly with end-users instead of relying on intermediate channel partners.What is the most likely result of Madison's shift to services?
A) horizontal integration
B) channel free-riding
C) upstream integration
D) service acquisition
E) disintermediation

Accepted Answer

Madison's shift towards offering more services directly to end-users instead of relying on intermediaries is an example of disintermediation, which is the elimination of intermediaries in a supply chain. By offering more services directly to customers, Madison is cutting out the middlemen and reducing costs, which could help them compete more effectively against their overseas competitors.

Quiz 9: Emerging Channel Structures and Strategies

Emerson Electric most likely shifted to a service-based business model for the purpose of ________.

Which statement is most likely true about shifting from a product-based to a service-based business?

How has the Internet been an "enabling technology" in the music industry?

What is the best way a channel manager can adjust to higher levels of coproduction and inventory perishability in service settings?

Which U.S.trend is significantly influencing marketing channel structures and strategies?

Which of the following best describes coproduction?

Which concept refers to the inability to inventory services until they are needed?

The fact that a service cannot be touched,seen,or patented refers to its ________.

What is most likely a disadvantage of developing in-house service capabilities?

What is the most likely reason that a firm's channel strategy is affected when the firm no longer offers a physical product?

Which of the following is LEAST likely a characteristic of services?

What is a likely advantage of acquiring service capabilities,infrastructure,and knowledge by collaborating with an existing service provider?

Most firms have added services to their current product offerings for the purpose of ________.

Which term refers to the degree to which a firm's sales come from services?

VCW Enterprises manufactures small electronics and plans to start selling warranty services in the near future.VCW's financial performance will most likely increase dramatically once VCW earns at least ________ of its sales from services.

According to the text,consumer electronics manufacturers are increasingly offering service warranties for their products to ________.

Which service characteristic is substantial,difficult to control,and highly dependent on an employee's delivery?

What is the primary reason that many automobile manufacturers increased both dealership costs and service standards?

According to the text,Johnson Controls' service division is large and fast growing because the firm________.