Deck 10: Pricing Strategies: Understanding and Capturing Customer Value

Question 1

The modern marketing organisation uses its marketing logistics strength to coordinate functions and manage the activities of a range of entities.Which of the following is NOT one of them?

A)suppliers
B)purchasing agents
C)manufacturers
D)intermediaries
E)government departments

Answer 1

E

Question 2

In moving goods,managers try to choose a set of warehouses,or cross-docking points,and transportation carriers that will deliver finished goods to final destinations in the desired time and\or at the lowest total cost.

Answer 2

True

Question 3

The modern marketing supply chain might also be thought of as a value delivery network.

Answer 3

True

Question 4

Which of the following transportation modes is used for digital products?

A)trucks
B)rail
C)the internet
D)air
E)ship

Question 5

A firm located in a seaport town sells rock,gravel and sand to local markets.It has just been awarded a large contract with a company 500 miles down the coast.Management should consider switching from truck to ________ transport.

A)water
B)rail
C)pipeline
D)air
E)None of the above.

Question 6

The total cost of logistics is minimal and can amount to just 5-10 per cent of a product's cost.

Question 7

The following terms are often used interchangeably by different commentators: logistics,marketing logistics,integrated logistics management,supply-chain management,materials management and physical distribution.

Question 8

The main supply chain functions focusing on the customer end include which of the following ?

A)warehousing
B)inventory management
C)transportation
D)logistics information management
E)All of the above.

Question 9

Developing a green supply chain is not only environmentally responsible;it can also be profitable.

Question 10

Logistics,more than almost any other marketing activity,affects the environment and a firm's environmental sustainability efforts.

Question 11

Through the use of ________,or 'smart tag' technology,a company is able to locate exactly where a product is within the supply chain.

A)RFID
B)PRM
C)VMS
D)IT
E)3PL

Question 12

In your text,the system that efficiently and effectively makes and moves products to end users is termed ________.

A)physical distribution
B)logistics network management
C)a goods and services transportation network
D)cross docking
E)a supply chain

Question 13

The supply chain involves many decisions related to marketing channels and logistics.Which of the following would be a logistics decision?

A)whether to sole-source
B)where to locate a plant
C)what type of operational process to use
D)whether to supply from inventory or from production
E)All of the above.

Question 14

Jewels for the Rich and Famous sells very exclusive jewellery with a minimum price of $25 000 to customers around the world.Speed of delivery to distant markets is a must.Management should consider using ________ as its main carrier.

A)rail
B)air
C)truck
D)the internet
E)water

Question 15

The supply chain management involves many activities and decisions related to marketing channels and logistics.Which of the following would NOT be a supply chain management decision?

A)sales forecasting
B)production plans
C)the total cost of logistics
D)transportation
E)All of the above.

Question 16

Marketing logistics trade-offs occur when management seeks to find optimal results in terms of achieving shareholder value while also achieving maximal sales and cash flow for the company.

Question 17

Carrying too much inventory is always preferable to carrying too little.

Question 18

In choosing a transportation mode for a product,shippers must balance many considerations.Which of the following is NOT a principal consideration for selecting the optimal transportation mode?

A)speed
B)dependability
C)availability
D)cost
E)company reputation

Question 19

Which of the following lists of intermodal transportation combinations means rail and trucks,water and trucks,and water and rail?

A)fishyback,airtruck and trainship
B)piggyback,airtruck and fishyback
C)trainship,fishyback and piggyback
D)piggyback,fishyback and trainship
E)piggyback,fishyback and birdyback

Question 20

A company using just-in-time (JIT)logistics carries only small inventories and uses sophisticated forecasting along with flexibly delivery so that supplies of new stock arrive only when they are needed.

Question 21

Marketing channel members perform many key functions.Which of the following is NOT normally a channel function?

A)information gathering and distributing
B)matching the offer to the buyer's needs
C)negotiating an agreement on price and other terms to facilitate transfer of ownership
D)risk taking-assuming the risks of carrying out the channel work.
E)sale of products or services to final end users

Question 22

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

A)channel members
B)distributors
C)consumers
D)manufacturers
E)marketers

Question 23

To reduce inventory management costs,many companies use a system called ________,which involves carrying only small inventories of parts or merchandise,often only enough for a few days of operation.

Question 24

The ________ carries digital products from producer to customer via satellite,cable or copper wire.

Question 25

A marketing ________ is a network of interdependent organisations called intermediaries that are involved in the process of making a product or services available to users.

A)channel
B)network
C)structure
D)chain
E)complex

Question 26

________ account for the major share of freight movement within Australia with some 40 per cent of total cargo tonne-kilometres moved.

Question 27

Using ________ ________ ________ systems,retailers can share real-time data on sales and current inventory levels with suppliers who take responsibility for ordering and delivering products to retailers,thereby saving time and money.

Question 28

Intermediaries play an important role in coordinating ________.

A)dealer with customer
B)supply and demand
C)strategy and product
D)manufacturer to product
E)information and promotion

Question 29

In moving goods,managers try to choose a set of warehouses (stocking points),or cross-docking points,and transportation carriers that will deliver finished goods to final destinations in the desired ________ and\or at the lowest ________.

Question 30

A 'smart tag' or RFID technology is a small transmitter chip embedded in or placed on products and packaging,allowing the products to be tracked throughout the distribution channel.

Question 31

The goal of marketing logistics should be to provide a(n)________ level of customer service at the least cost.

Question 32

Many large and resourceful marketing companies,such as Coles,Woolworths,Metcash and Unilever are investing heavily to make the full use of RFID technology a reality.

Question 33

Air carriers transport less than ________ per cent of cargo tonne-kilometres of the nation's goods.

Question 34

Proud Pets,a producer of clothing and accessories for pets,has recently partnered with a regional chain of pet stores.Which of the following would Proud Pets be LEAST likely to expect from its new channel member?

A)promoting its products through advertising
B)assembling and packaging its products for final sale
C)distributing relevant marketing research information
D)identifying raw materials and other productive inputs
E)negotiating on its products' prices

Question 35

Among the most frequently air-freighted products are ________.

Question 36

Members of the marketing channel add value when they move goods from producers and suppliers to consumers by overcoming ________,________ and ________ gaps that arise when separate suppliers are unable to coordinate supply and demand.

A)time;place;possession
B)time;substance;style
C)form;economic;service
D)market;competitive;strategic
E)access;convenience;service

Question 37

Intermediaries usually offer a firm more than it can achieve on its own.Which of the following is most likely an advantage of working with intermediaries?

A)financial support
B)fast service
C)scale of operation
D)working relationships with foreign distributors
E)strategy development

Question 38

The difference between distribution centres and storage warehouses is that distribution centres are designed to ________ goods rather than just store them.

Question 39

The modern marketing organisation uses its ________ strength to coordinate functions within it by managing the activities of suppliers,purchasing agents,manufacturers,marketers,intermediaries and customers.

Question 40

Producers benefit from using intermediaries because they ________.

A)offer greater efficiency in making goods available to target markets
B)bring a fresh point of view to strategy development
C)eliminate risk
D)are generally backlogged with orders
E)refuse to store products for longer than a few days

Question 41

A direct marketing channel consists of how many levels?

A)zero
B)one
C)two
D)three
E)It is inappropriate to use levels when describing direct marketing.

Question 42

Which of the following are the three major types of vertical marketing systems?

A)corporate,contractual and chain
B)contractual,corporate and independent
C)corporate,contractual and administered
D)administered,independent and franchised
E)corporate,contractual and task

Question 43

An advantage of a vertical marketing network (VMN)over a conventional distribution channel is that it acts as a ________ system.

A)unified
B)democratic
C)socially responsible
D)customer-driven
E)task-driven

Question 44

David Jones terminated its arrangements to supply clothing from popular fashion label,Country Road,following the latter's increasing involvement with direct factory outlets.For the prestige retailer,David Jones,Country Road's activities were not only a direct source of competition,but also represented an inconsistency with their carefully crafted prestige image.This is an example of ________.

A)exclusive dealing
B)channel conflict
C)a breakdown in a contractual network
D)a power struggle
E)All of the above.

Question 45

________ conflict,which occurs between different levels of the same channel,is more common than ________ conflict,which occurs among firms at the same level of the channel.

A)Horizontal;vertical
B)Vertical;horizontal
C)Contractual;corporate
D)Corporate;franchise
E)Wholesaler;retailer

Question 46

A channel consisting of one or more independent producers,wholesalers or retailers each seeking to maximise its own profits even at the expense of profits for the channel as a whole is a(n)________.

A)vertical marketing system
B)conventional marketing channel
C)independent channel allocation
D)corporate VMS
E)administered vertical marketing system

Question 47

Which type of product might require a more direct marketing channel to avoid delays and too much handling?

A)lower-priced products
B)perishable products
C)high-priced products
D)products in their maturity stage
E)products in their decline stage

Question 48

In marketing terms,we say that the number of intermediary levels indicates the ________ of a channel.

A)depth
B)complexity
C)involvement
D)length
E)width

Question 49

Which of the following statements about a zero-level channel is correct?

A)It may also be called a backward channel.
B)It is the same as a direct marketing channel.
C)It has only one intermediary between producer and consumer.
D)It has three members.
E)It refers to intensive distribution channels where there are an indeterminate number of channel members.

Question 50

The goal of channels in the service sector is to make the service ________.

A)available to target populations
B)affordable,differentiated and easy to find
C)risk free,readily available and differentiated
D)differentiated,targeted and affordable
E)affordable and accessible

Question 51

A distribution channel is more than a collection of firms connected by various flows;it is a(n)________ in which people and companies interact to accomplish individual,company and channel goals.

A)added value chain
B)complex behavioural system
C)corporate marketing system
D)vertical marketing system
E)multichannel system

Question 52

A conventional distribution channel consists of one or more ________ producers,wholesalers and retailers.

A)product-related
B)independent
C)contract
D)franchised
E)None of the above.

Question 53

All of the institutions in a channel are connected by flows,including physical flow,flow of ownership,payment flow,information flow and ________ flow.

A)promotion
B)acquisition
C)customer
D)return product
E)by-product

Question 54

Marketing channels may be used to market ________.

A)a hospital
B)government ideas
C)birth-control clinics
D)comedians
E)All of the above.

Question 55

When two Hungry Jacks restaurants have a disagreement over who should be able to sell in quantity at a discount to local athletic teams,it is called a ________ channel conflict.

A)vertical
B)disintermediation
C)multichannel
D)horizontal
E)functional

Question 56

To a producer of goods,a greater number of channel levels means ________ and greater channel complexity.

A)less distance between producer and end consumer
B)less control
C)more potential ideas
D)higher taxes
E)fewer channel members

Question 57

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

A)layer
B)level
C)tier
D)stratum
E)None of the above.

Question 58

Staples Office Supply opened an online store that created competition with many of its dealers.The corporate office created a(n)________ conflict.

A)vertical
B)problematic
C)functional
D)horizontal
E)intermediation

Question 59

A ________ consists of producers,wholesalers and retailers acting as a unified system.

A)value-driven marketing network
B)corporate marketing network
C)complex marketing network
D)physical distribution system
E)vertical marketing network

Question 60

Historically,________ have lacked strong leadership and have been troubled by damaging conflict and poor performance.

A)corporate vertical marketing systems
B)contractual vertical marketing systems
C)conventional marketing channels
D)administered vertical marketing systems
E)conventional vertical marketing systems

Question 61

When a Hudsons coffee shop offers its products inside of a private hospital,it is acting as part of a ________.

A)conventional distribution channel
B)direct marketing channel
C)disintermediated system
D)administered VMS
E)horizontal marketing system

Question 62

Disintermediation refers to ________.

A)a process of restructuring marketing channels in order to deal more directly with customers
B)a process of attempting to exert some control over complex and fragmented channels
C)a shift from conventional to vertical marketing networks
D)a synonym for direct marketing
E)the process of acting as a mediator in channel conflict

Question 63

Which of the following is an example of a multichannel distribution system?

A)K-Mart setting up outlets in several new countries
B)Myer catalogue and retail store sales
C)Avon's door-to-door distribution
D)a hotel providing guest privileges at a health spa across the street
E)All of the above.

Question 64

Producers who can afford to set up their own channels are unlikely to use intermediaries.

Question 65

With increased use of the internet,few producers sell through intermediaries today.

Question 66

Orica's Dulux paint is sold through company-owned trade stores in Australasia as well as through competing outlets such as Bunnings and Mitre 10,and it is sold directly via the internet to professional painters.This is an example of ________.

A)dual distribution systems
B)multichannel distribution networks
C)administered franchises
D)horizontal multichannel systems
E)contractual marketing systems

Question 67

The Beta Corporation retains outright ownership of all members of its distribution channel.Beta's channel would be best described as a(n)________.

A)corporate VMN
B)consolidated VMN
C)administrative VMN
D)contractual VMN
E)proprietary VMN

Question 68

Members of the marketing channel add value when they move goods from producers and suppliers to consumers by overcoming time,placement and possession gaps.

Question 69

________ occur when a single firm sets up two or more marketing channels to reach one or more customer segments.

A)Dual distribution systems
B)Multichannel distribution networks
C)Administered franchises
D)Horizontal multichannel systems
E)Contractual marketing systems

Question 70

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

A)franchise
B)corporate VMN
C)horizontal marketing network
D)multichannel distribution network
E)conventional distribution channel

Question 71

As marketing manager for Globe Imports and Exports,you want to start reaping the benefits of a multichannel distribution system.You will likely enjoy all of the following EXCEPT which one?

A)expanded sales
B)expanded market coverage
C)selling at a higher gross margin
D)opportunities to tailor products and services to the needs of diverse segments
E)greater profitability

Question 72

Equitable Products Corporation has negotiated legal agreements with each member of its channel to ensure channel coordination,and it spells out procedures for conflict management.The firm's distribution system would be best described as a(n)________.

A)administrative VMN
B)contractual VMN
C)consolidated VMN
D)corporate VMN
E)proprietary VMN

Question 73

Due in a large part to advances in technology,________ is a major trend whereby product and service producers are bypassing intermediaries and going directly to final buyers,or radically new types of channel intermediaries are emerging to displace traditional ones.

A)the vertical marketing system
B)the corporate marketing system
C)disintermediation
D)the corporate merger
E)the hostile takeover

Question 74

It is becoming rare for marketers to use a(n)________ marketing channel to reach their target markets.

A)single
B)dual
C)controlled
D)complex
E)tertiary

Question 75

Which of the following is an example of a manufacturer-sponsored retailer franchise system?

A)fast-food restaurants such as McDonald's and Hungry Jacks
B)Ford and its network of independent franchised dealers
C)licensed bottlers that bottle and sell Coca-Cola to retailers
D)a motel chain such as Holiday Inn and Quest Group
E)All of the above.

Question 76

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

A)decreasing understanding of complex markets
B)decreasing control over the system
C)fewer opportunities for franchising
D)increasing disintermediation
E)reducing conflict among channel members

Question 77

A corporate VMN has the advantage of controlling the entire distribution chain under ________.

A)a profit-maximising strategic plan
B)single ownership
C)mass distribution
D)a few intermediaries
E)franchise agreements

Question 78

Which of the following is NOT a form of contractual VMN?

A)wholesaler sponsored voluntary chain
B)retailer cooperative
C)manufacturer-sponsored retailer franchise network
D)service-firm-sponsored retailer franchise network
E)corporate vertically managed network

Question 79

Leadership in which type of marketing system 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 VMN
C)corporate VMN
D)conventional marketing channel
E)multichannel distribution system

Question 80

Multichannel distribution systems are also called ________.

A)dual distribution systems
B)hybrid marketing systems
C)administered franchises
D)horizontal multichannel systems
E)contractual marketing systems