Deck 2: Organizational Strategies and the Sales Function

Question 1

Which of the following is not a key decision area of corporate strategy?

A) Corporate mission
B) Strategic business unit definition
C) Target market selection
D) Strategic business unit objectives
E) Corporate growth orientation

Answer 1

C

Question 2

All of the following are key decision areas in sales strategy except

A) account targeting strategy.
B) relationship strategy.
C) marketing mix strategy.
D) selling strategy.
E) sales channel strategy.

Answer 2

C

Question 3

Which of the following is one of the steps in corporate strategy development?

A) Developing a marketing mix to serve a target market.
B) The development of an account management strategy.
C) Developing a corporate strategy for each of the SBUs.
D) Determining the amount to spend on the personal selling function.
E) Analyzing the corporate situation to identify potential opportunities and threats.

Answer 3

E

Question 4

Which of the following is a key decision area for marketing strategy?

A) account targeting strategy.
B) relationship strategy.
C) selling strategy.
D) marketing mix development.
E) sales channel strategy.

Question 5

Which of the following is not one of the steps in corporate strategy development as outlined in the text?

A) Determining corporate mission and objectives.
B) The development of an account management strategy.
C) Defining strategic business units.
D) Setting objectives and resource allocations for each strategic business unit.
E) Analyzing the corporate situation to identify potential opportunities and threats.

Question 6

The ________ provides direction for strategy development and execution throughout the organization.

A) mission statement
B) strategy statement
C) corporate plan
D) business unit portfolio
E) goal statement

Question 7

The most successful mission statements are

A) simple.
B) complete.
C) communicated directly to salespeople.
D) all of the above.

Question 8

The basic purpose of defining strategic business units is to

A) divide the corporation into parts to facilitate strategic analysis and planning.
B) provide management opportunities in different regions.
C) allow for a more focused market perspective.
D) reorganize the personal selling operations of the firm.
E) allow maximum support of each product or line of products and to avoid expensive duplication within the corporation.

Question 9

One definition of an SBU is

A) a qualitative description of the firm's strategic orientation in relation to customers and markets, products and services, geographic scope, and technology.
B) the method by which corporate management implements, evaluates, and controls the corporate strategic plan.
C) the corporate growth orientation of the firm.
D) a designated unit within a corporation that is operated like an individual business.
E) the firm's decision regarding market share objectives for different product lines.

Question 10

Changes in the definition of SBUs can affect the personal selling function in all of the following ways except

A) salesforces may have to be merged.
B) existing salesforces may have to perform different activities.
C) the type of salespeople to be hired may change.
D) new salesforces may have to be established.
E) more sales managers will always have to be hired.

Question 11

The strategic business unit portfolio can be defined as

A) the different product lines making up the SBU.
B) the SBU's investments, made with excess working capital.
C) all of the corporation's strategic business units.
D) the stocks and bonds held by the stockholders.
E) the markets served by each strategic business unit.

Question 12

If the sales organization objective is to increase sales volume and expand distribution outlets, then the recommended compensation system is

A) salary plus commission or bonus.
B) salary plus sales-based incentives.
C) salary plus bonus.
D) salary.
E) commission.

Question 13

If the sales organization objective is to maintain sales volume then the SBU objective is likely to be

A) hold market share.
B) build market share.
C) develop market share.
D) establish market share.
E) harvest market share.

Question 14

If the sales organization objective is to increase sales volume and expand distribution outlets, then the SBU objective is likely to be

A) hold market share.
B) build market share.
C) develop market share.
D) establish market share.
E) harvest market share.

Question 15

If the sales organization objective is to reduce selling costs and target profitable accounts, then the SBU objective is likely to be

A) hold market share.
B) build market share.
C) develop market share.
D) establish market share.
E) harvest market share.

Question 16

If the sales organization objective is to minimize selling costs and clear out inventory, then the SBU objective is likely to be

A) hold market share.
B) build market share.
C) divest/liquidate market share.
D) establish market share.
E) harvest market share.

Question 17

If the sales organization objective is to minimize selling costs and clear out inventory, then the recommended compensation system is likely to be

A) salary plus commission or bonus.
B) salary plus sales-based incentives.
C) salary plus bonus.
D) salary.
E) commission.

Question 18

If the SBU objective is harvest market share, the primary sales tasks include all of the following except

A) provide product/market feedback.
B) service the most profitable accounts.
C) eliminate unprofitable accounts.
D) reduce service levels.
E) reduce inventories.

Question 19

When the SBU objective is to "hold market share," which of the following is the primary sales task?

A) Service the most profitable accounts.
B) Replace lost sales with new accounts.
C) Eliminate unprofitable accounts.
D) Reduce service levels.
E) Reduce inventory.

Question 20

When the SBU objective is to "harvest market share," which of the following is NOT a primary sales task?

A) Service the most profitable accounts.
B) Eliminate unprofitable accounts.
C) Replace lost sales with new accounts.
D) Reduce service levels.
E) Reduce inventory.

Question 21

Porter's classification scheme for business unit strategies is referred to as

A) target marketing.
B) generic business strategies.
C) differentiation strategies.
D) universal product strategies.
E) product/market evaluation.

Question 22

By creating something perceived industry wide as being unique, a company is employing the ___________ business unit strategy.

A) generic
B) differentiation
C) low-cost
D) segmentation
E) niche

Question 23

A company that strives for tight cost and overhead control and maintains a high market share is probably using this business unit strategy:

A) low cost.
B) niche.
C) differentiation.
D) segmentation.
E) generic.

Question 24

A low overall market share with domination in a particular region or segment is usually indicative of a company employing this business unit strategy:

A) segmenting.
B) regional.
C) differentiation.
D) niche.
E) low cost.

Question 25

Which of the following likely is not one of the roles of the salesforce of the firm is using a low-cost supplier strategy?

A) Servicing large current customers.
B) Pursuing large prospects.
C) Selling nonprice benefits.
D) Minimizing costs.
E) Assuming significant order-taking responsibilities.

Question 26

Which of the following likely is not one of the roles of the salesforce of the firm is using a differentiation strategy?

A) Providing high quality of customer service and responsiveness.
B) Generating orders.
C) Selling nonprice benefits.
D) Selecting customers based on high price sensitivity.
E) Significant prospecting in high growth industry.

Question 27

Which of the following is false with regards to customer relationship management (CRM)?

A) Effective implementation of a CRM strategy requires an appropriate business philosophy.
B) CRM requires a customer-centric business philosophy.
C) CRM applications can enable effective customer relationship management.
D) Effective implementation of a CRM strategy requires integrated cross-functional business processes.
E) Successful firms tend to focus on the CRM technology first and then try to adapt their strategy, philosophy, process and capability to fit the technology.

Question 28

A target market can be defined as

A) a market that is being used to test a new product.
B) a key component of the SBU definition.
C) the specific market segment to be served by a particular product.
D) the market to which all personal selling effort will be targeted.
E) a competitor's stronghold, where they hold the dominant market share.

Question 29

The company's marketing strategy includes a marketing mix, which is a mixture of all of the following except

A) price strategies.
B) distribution strategies.
C) marketing communications strategies.
D) production strategies.
E) product strategies.

Question 30

A company's marketing communications strategy consists of a mixture that includes all of the following except

A) publicity.
B) distribution intensity.
C) advertising.
D) personal selling.
E) sales promotion.

Question 31

Personal selling, advertising, sales promotion and publicity comprise what is referred to as

A) marketing strategy.
B) selling strategy.
C) marketing mix strategy.
D) marketing communications strategy.
E) sales promotion strategy.

Question 32

For most marketing communications strategies, the main communication tools are

A) sales promotion or advertising.
B) publicity or public relations.
C) personal selling or sales promotion.
D) advertising or personal selling.
E) publicity or personal selling.

Question 33

___ _ is the only promotional tool that consists of personal communication between seller and buyer.

A) Sales promotion
B) Personal selling
C) Advertising
D) Public relations
E) Publicity

Question 34

Major advantages of personal selling include all of the following except

A) ability to close the sale.
B) increased credibility.
C) better timing of message delivery.
D) more flexibility.
E) low cost-per-contact.

Question 35

Personal-selling driven marketing communications strategies are most appropriate when

A) low cost per contact is important.
B) size of the audience is large.
C) message flexibility is important.
D) repetitive contact is important.
E) control of the message is important.

Question 36

What is the major disadvantage of personal selling?

A) It costs a lot to reach each member of the audience.
B) It lacks flexibility.
C) It is low in impact.
D) It is difficult to reach large audiences.
E) It is hard to achieve message repetition.

Question 37

The preferred marketing communications tool for business marketing is

A) public relations.
B) advertising.
C) personal selling.
D) publicity.
E) sales promotion.

Question 38

Which of the following statements regarding the marketing communications mix is false?

A) The marketing communications mix should be consistent with the other elements of the marketing mix.
B) An effective marketing communications mix must capitalize on the advantages of each marketing communications tool.
C) In consumer marketing situations, the preferred marketing communications tool is personal selling.
D) The benefits of personal selling may outweigh the costs in certain types of product/market situations.
E) Firms in the direct selling industry, such as Avon and Mary Kay, use an atypical marketing communications strategy.

Question 39

All of the following would suggest the use of advertising-driven marketing communications strategies except when

A) low cost per contact is important.
B) size of the audience is large.
C) message flexibility is important.
D) repetitive contact is important.
E) control of the message is important.

Question 40

Advertising driven marketing communications strategies are most appropriate when

A) trying to close the sale.
B) the message timing is important.
C) message flexibility is important.
D) repetitive contact is important.
E) reaction speed is important.

Question 41

All of the following would suggest the use of personal selling-driven marketing communications strategies except when

A) trying to close the sale.
B) the message timing is important.
C) message flexibility is important.
D) repetitive contact is important.
E) reaction speed is important.

Question 42

Advertising-driven marketing communications strategies are best when all of the following characteristics exist except

A) There are many buyers.
B) Buyers are concentrated geographically.
C) Purchase information needs are low.
D) Purchases are not important.
E) Products being purchased are low in complexity.

Question 43

_______________ is typically the preferred marketing communications tool for business marketing, whereas ______________ is normally emphasized in consumer marketing situations.

A) Personal selling, advertising
B) Advertising, personal selling
C) Personal selling, publicity
D) Sales promotion, advertising
E) Personal selling, sales promotion

Question 44

Which of the following marketing mix situations would not indicate that an emphasis in personal selling would be appropriate?

A) The channel system is relatively short and direct to the end users.
B) The final price is negotiated between the buyer and seller.
C) The product is complex and requires customer application assistance.
D) The product needs to be "pulled" through the channel of distribution.
E) The selling price or quantity purchased allows an adequate margin to support the selling expenses.

Question 45

Personal selling driven strategies are appropriate when

A) the market consists of only a few buyers scattered rather thinly over an area.
B) a professional buyer is involved and does not need much information.
C) the product is complex.
D) the purchase is relatively unimportant.
E) service after the sale is not necessary.

Question 46

An example of one effect of integration of advertising and personal selling would be

A) salespeople cold canvass to find interested prospects, then ask them to watch a videotape advertising their product.
B) an advertisement gives a toll-free number where customers can call to place their order.
C) a commercial on television promises a satisfaction guarantee on their product to potential customers.
D) advertising is used to generate sales leads, which are then turned over to the salesforce to close the sale.
E) qualified customers are located through the company's directories and then called on by the salesforce.

Question 47

According to the text, which of the following is not one of the activities that require the marketing and the sales functions to work closely together?

A) Sales forecasting
B) Target marketing
C) Value proposition development/customer messaging
D) Customer account selection
E) Merchandising

Question 48

Sales and marketing often focus on different activities. Which of the following is not one of the activities on which sales focuses?

A) Distributor management
B) Account management
C) Merchandising
D) After-sales service
E) Product positioning

Question 49

The buying situation that poses the most problems for the buyer is the

A) modified rebuy buying situation.
B) similar task buying situation
C) new task buying situation.
D) ongoing-project buying situation
E) straight rebuy buying situation.

Question 50

Which of the following statements regarding organizational buying situations is true?

A) There are no similarities in the types of buying situations facing different accounts.
B) Buyers facing a new-task buying situation will typically use a lengthy process to collect and evaluate purchase information.
C) Selling organizations can use the same sales strategy for each type of buying situation if they change their sales coverage strategy.
D) In a modified-rebuy buying situation, the buyer has not previously purchased or used the product, but has used similar products.
E) When buyers are merely reordering from the current supplier, they are in an ongoing- project buying situation.

Question 51

Which of the following statements regarding the straight-rebuy buying situation is false?

A) The buyer is merely reordering from the current supplier and engaging in routinized response behavior.
B) The account has considerable experience in using the product.
C) The organization wants to collect additional information and may make a change when purchasing a replacement product.
D) The account is satisfied with the current purchase arrangements.
E) This is the least complex buying situation.

Question 52

The decision-making process in a new task buying situation is often referred to as

A) extensive problem solving.
B) excessive problem solving.
C) routinized response behavior.
D) limited problem solving.

Question 53

The decision-making process in modified rebuy buying situation is often referred to as

A) extensive problem solving.
B) routinized response behavior.
C) minimal problem solving.
D) limited problem solving.

Question 54

The decision-making process in straight rebuy buying situation is often referred to as

A) extensive problem solving.
B) routinized response behavior.
C) rapid response behavior.
D) limited problem solving.

Question 55

Sales strategy should be based on an understanding of all of the following critical elements of organizational buyer behavior except

A) buying needs.
B) buying discrimination.
C) buying process.
D) buying situation.
E) buying center.

Question 56

The concept buying center can be defined as

A) the physical location of the purchasing agent's office.
B) the division that handles the purchasing for the entire company.
C) all individuals from a firm that participate in any selling operation.
D) all individuals from a firm that participate in any particular buying decision.
E) those individuals designated on the organization chart that have the authority to instigate purchases.

Question 57

Roles that buying-center members might play in a particular purchasing decision include all of the following except

A) purchasers.
B) producers.
C) influencers.
D) users.
E) deciders.

Question 58

The buying center member who starts the organizational purchasing process is referred to as the

A) initiator.
B) user.
C) influencer.
D) decider.
E) purchaser.

Question 59

The buying center member who provides input for the purchasing decision is referred to as the

A) initiator.
B) gatekeeper.
C) influencer.
D) decider.
E) purchaser.

Question 60

The buying center member who makes the final purchase decision is referred to as the

A) boss.
B) gatekeeper.
C) influencer.
D) decider.
E) purchaser.

Question 61

Which of the following statements regarding a buying center is true?

A) The roles of buying-center members are generally pointed out to the seller ahead of time.
B) Each individual may perform more than one buying center role.
C) The purchasers buying role always includes making the final purchase decision.
D) Each buying role is performed by only one individual at a time.
E) The buying center is always formally designated on the company's organization chart.

Question 62

Which of the following is the first phase in the buying process?

A) Description of the characteristics of the item and the quantity needed.
B) Recognition of problem or need.
C) Description of the characteristics of the item and quantity needed.
D) Search for and qualification of potential sources.
E) Acquisition and analysis of proposals.

Question 63

The individual needs that come into play in an organizational-buying situation tend to be

A) the result of insecurity.
B) related to the use of the product.
C) entirely objective.
D) career related.
E) driven by a need to keep costs within a budget limit.

Question 64

If buying-center members want to reduce purchase risk and protect job security, they might

A) buy the lowest-priced alternative offered.
B) buy the product with the record of fewest breakdowns.
C) buy the product with the lowest operating costs.
D) buy a product that they are told uses state-of-the-art technology.
E) buy the product with the most well-known brand name.

Question 65

Which of the following is not an example of an organizational need that might be important in a purchase situation?

A) Desire for job security.
B) Control cost in product use situation.
C) Few breakdowns of product.
D) Adequate supply of product.
E) Cost within budget limit.

Question 66

__ __ and __ __ are typically responsible for strategic decisions at the account level.

A) Salespeople, SBU managers
B) Corporate management, sales managers
C) SBU managers, marketing managers
D) Sales managers, salespeople
E) Salespeople, marketing managers

Question 67

Which of the following is not one of the characteristics of collaborative relationships?

A) focus on selling products
B) provide a customized offering
C) serve a limited number of customers
D) involve a long-term perspective
E) center on adding value

Question 68

A(n) __________________ is the planned selling approach for each relationship strategy.

A) relationship
B) account targeting
C) selling strategy
D) sales channel
E) marketing

Question 69

Both costs to serve the customer and commitment between buyer and seller are highest with this type of relationship strategy.

A) Solutions Relationship
B) Supplier Relationship
C) Transaction Relationship
D) Collaborative Relationship
E) Partnership Relationship

Question 70

Both costs to serve the customer and commitment between buyer and seller are lowest with this type of relationship strategy.

A) Solutions Relationship
B) Supplier Relationship
C) Transaction Relationship
D) Collaborative Relationship
E) Partnership Relationship

Question 71

A __________ selling strategy is the most appropriate strategy to use with a partnership relationship strategy.

A) problem solving
B) consultative
C) need satisfaction
D) mental states
E) stimulus response

Question 72

A sales channel strategy can be defined as

A) the type of relationship the selling firm desires to develop and maintain with the account.
B) the decision to build either a relationship or transaction marketing type of salesforce.
C) the number of accounts per field representative for a certain area.
D) the methods by which accounts receive selling effort.
E) decisions made by marketing management that determine whether sales will be personal selling or advertising driven.

Question 73

A(n) __________________ strategy ensures that accounts receive selling effort coverage in an effective and efficient manner.

A) relationship
B) account targeting
C) selling
D) sales channel
E) marketing

Question 74

Which of the following is not a type of sales channel strategy outlined in the text?

A) Internet
B) Distributors
C) Independent representatives
D) Team selling
E) Door-to-door selling

Question 75

___________ are channel middlemen that take title to the goods that they market to end users.

A) Distributors
B) Manufacturers' reps
C) Independent representatives
D) Telemarketing sales representatives
E) Company sales reps

Question 76

Distributors can be characterized as

A) the company's salesforce for industrial products.
B) the end users for a company's product.
C) independent sales organizations that sell complementary, but noncompeting, products from different manufacturers.
D) channel middlemen that take title to the goods that they market to end users.
E) channel middlemen that do not take title to the goods.

Question 77

Which of the following statements relating to distributors is false?

A) They typically employ their own field salesforce.
B) They may carry competing products from different manufacturers.
C) Firms that use distributors normally have a relatively small company salesforce.
D) Distributors should not be treated as customers.
E) They may carry the products of only one manufacturer.

Question 78

The importance of developing a partnership with distributors has been emphasized in the text. Which of the following situations would strengthen this relationship?

A) Commissions on sales to direct salespeople are lowered for sales made jointly with distributors.
B) Direct salespeople call on the most profitable accounts and ask the distributor's salesforce to handle all other accounts.
C) The manufacturer provides its distributors with market information to help them succeed.
D) When new models for equipment are available, ask the distributors to take care of selling out the old models and allow the company's salesforce to begin offering the new model.
E) Company salespeople have first choice of the new leads generated by a shared booth at a trade show.

Question 79

Independent representatives can be characterized as

A) the company's salesforce for industrial products.
B) the end users for a company's product.
C) independent sales organizations that sell complementary, but noncompeting, products from different manufacturers.
D) channel middlemen that take title to the goods.
E) channel middlemen that sell only in certain industries.

Question 80

Which of the following statements regarding independent representatives is false?

A) They normally do not take title to the products they sell.
B) Independent representatives are compensated on a straight salary basis.
C) Manufacturers typically develop contractual agreements with several rep organizations.
D) They are independent sales organizations that sell complementary, but noncompeting, products from different manufacturers.
E) Each rep organization is assigned a geographical territory.