FINAL EXAM EXERCISE True/False 1.

Creating an innovative culture and setting boundaries for the types of new products to be considered are important to the foundation necessary for successful innovation. 2. Analyses appropriate for new-product evaluation include break-even, cash flow, return on investment and profit contribution. 3. When the responsibility for the new-product launch is assigned to a marketing or product manager no coordination is necessary with other functions of the company. 4. Product life cycles are becoming longer for many products due to new technology, rapidly changing preferences of buyers and intense competition. 5. Retailer market sensing in positioning different types of private labels and opening up new markets underlines an important challenge to traditional brand owners. 6. Co-branding consists of two well-known brands working together in promoting their products. Co-branding occurs when brands from different organizations (or distinctly different businesses within the same organization) combine to create an offering in which brands from each play a driver role. 7. The economic performance of vertical marketing systems is likely to be lower than that in conventional channels, if the channel network is properly designed and managed. FALSE (MS 324-325) 8. The digitization of products and channel functions is not necessarily associated with the process of disintermediation replacing distributors with direct manufacturer-owned channels. TRUE (MS 327) 9. Conflicts rarely occur between the channel members and in multi-channeling between channels, because everyone has the same objectives, priorities and corporate cultures. FALSE (MS 337) 10. The core issue in pricing is finding out what value requirements (benefits-costs) the buyer places on the product or brand. TRUE (MS 354) 11. The underlying logic of economic value modeling (EVM) is that "a dollar worth of benefits minus price" is a more realistic view of value than using the price/benefit ratio. TRUE (MS 354) 12. Price becomes a more active element of strategy as products move through the life cycle and competitive pressures build, costs decline and volume increases. TRUE (MS 369) 13. Since budget limits are a reality in most companies, the all you can afford budgeting method for promotion is not likely to influence all budget decisions. 14. The increasing demands for integrated marketing communications strategies and the development of complex multi-media campaigns, will not require re-evaluating the traditional client/agency relationship.

15. Sales promotion is some form of inducement (e.g., coupon, contest, rebate, etc.). Unfortunately, these effective activities can not target the various points of influence in the value chain. 16. A company will never use more than one of the selling strategies such as new business, missionary, consultative and trade. 17. There is a significant trend toward a greater focus on customers (market driven) designs rather than products or geography as the basis for the design of the sales organization. 18. The five recommended measures of Internet effectiveness for independent auditing and verification proposed were ad impressions, clicks, unique visitors, total visits and page impressions. 19. The main advantage of the traditional approach to organization structures is that it creates barriers to the spread of knowledge. Ideas and commands flow vertically between the center and the business unit, creating "silos" with little communication across the business units (or silos). 20. Designing organizations in which the most talented individuals cannot work productively is a danger with conventional approaches. 21. The important distinction in marketing throughout the world is that buyers differ in their needs, preferences and priorities. Since such differences exist within a national market, the variations between countries are likely to be greater. 22. The implementation of marketing strategy is affected by external organizations such as strategic alliance partners, marketing consultants, advertising and public relations firms, channel members and other organizations participating in the marketing effort. 23. Marketing metrics use only external information about competitors to provide a structure for monitoring the effectiveness of marketing activities and strategies. 24. Strategic evaluation activities seek to (1) identify opportunities or performance gaps and (2) avoid planning actions that could correct existing problems.

MCQ 1. _____ is the combination of benefits provided by a product minus all of the costs incurred by the buyer A. Customer satisfaction B. Customer value C. Customer needs D. Customer innovation 2. _____ consists of the pursuit of a deliberate, ongoing strategy of developing and introducing new products that attract the buyers of a company's existing products. A. Unusual innovation B. Proactive cannibalization C. Successful innovation

D. Borrowing

3. Defining the strategic focus for the corporation in terms of product scope, markets and technologies is a part of _____. A. Mission statement B. Vision C. Strategy for innovation D. Innovation culture 4. The Inter brand model bases _____ on forecasts of brand revenues, allowing for risk and the role of the brand in stimulating customer demand. A. Brand value B. Brand strength C. Brand earnings D. Brand strength 5. _____ consists of coordinating the organization's system of brands with the objective of achieving optimal system performance. A. Strategic brand analysis B. Brand equity management C. Leveraging the brand D. Managing the brand portfolio 6. Strategic brand management initiatives have a positive or negative impact on the value of the brands in the portfolio _____ recognizes the importance of brand value and identifies the key dimensions of equity. A. Strategic brand analysis B. Brand equity management C. Brand identity strategy D. Managing the brand over time 7. The _____ is the configuration of distribution channels linking with end-users. A. Value chain B. Distribution strategy C. Retail strategy D. Digital channels 8. The factors that influence the distribution decisions include _____. A. Buyer considerations, product characteristics and advertising B. Financial and control factors C. Buyer considerations, product characteristics and financial and control factors D. Product characteristics and pricing

9. In highly competitive markets, the need for control of distribution may make channel _____ more attractive. Globally, many auto manufacturers are establishing their own retail outlets. A. Ownership B. Contractual C. Administered D. Relationship 10. Pricing decisions need to be coordinated with decisions for all of the _____ components. This pricing perspective mandates understanding how pricing is viewed and understood by customers. A. Positioning strategy B. Product strategy C. Distribution strategy D. Design strategy 11. Price plays the role of _____ when positioning the brand as a high-quality product or pursuing head-on competition with another brand, as illustrated by Hewlett-Packard's aggressive competition with Dell on personal computers in the consumer segment. A. Signal to the buyer B. Instrument of competition C. Improving financial performance D. Design strategy 12. _____ pricing methods use the cost of producing and marketing the product as the basis for determining price. A. Cost-oriented B. Demand-oriented C. Competition-oriented D. Predatory 13. _____ consists of any form of non-personal communication concerning an organization, product or idea that is paid for by a specific sponsor. The sponsor makes payment for the communication via one or more forms of media (e.g., television, radio, magazine, newspaper, online). A. Promotion B. Personal selling C. Sales promotion D. Advertising

14. Communications placed in the commercial media at no charge to the company receiving the publicity is _____. A. Public relations B. Advertising C. Personal selling D. Interactive/internet marketing 15. An objective of new product promotional activities is _____ to help buyers learn about the product and to identify the product by name. A. Need recognition B. Finding buyers C. Brand building D. Evaluation of alternatives

16. _____ sells to an existing customer base and provides technical and application assistance. These positions may involve the sales of complex equipment or services such as management consulting. Importantly, consultative selling requires giving sales professionals authority in negotiating sales. A. New business selling B. Trade selling C. Missionary selling D. Consultative/technical selling 17. _____ guide(s) the selling process by indicating the customers and prospects the firm is targeting and providing guidelines for developing customer relationships and obtaining sales results. A. Direct marketers B. Marketing managers C. Sales management D. Sales support 18. Similar customer needs and a complex range of products point to the _____ organizational design of the sales force. A. Geography B. Market driven C. Product/market D. Product driven

19. The _____ or the conventional approaches to organizing consist of business units, operating similarly but separately, controlled by a central authority (head office) which determines strategy and watches over implementation. This is a system of "command and control", made visible in organization charts that lay down organizational hierarchy. A. Traditional structures B. Horizontal business processes C. Collaborative working D. Informal networks 20. _____ emphasize(s) the importance of organizing around teams. Executives are increasingly expected to work as team members, but also to be skilled at constructing effective teams. A. Innovation B. Knowledge workers C. Collaborative working D. Informal networks 21. Toyota emphasizes "the criticality of speed" focusing on flexibility and _____ and the organization is designed to be faster than that of competitors. The company dramatically cut the time it takes to get from drawing board to showroom. A. Positioning B. Market responsiveness C. Hybrid organizational form D. Informal networks 22. A set of factors influencing marketing strategy implementation is _____ issues, concerning marketing managers' skills in bargaining and negotiation, resource allocation and developing informal organizational arrangements. A. Structural B. Behavioral C. Situation D. Positioning 23. Performance standards for the implementation must be fair and _____ should encourage something more than normal performance. Focusing rewards on the achievement of overall plan goals rather than individual efforts is particularly relevant. A. Organization designs B. Incentives C. Communications D. Planning

24. Defining the _____ is(are) (a) critical factor(s) that can be difficult to discern since it is easy to confuse symptoms with causes. A. Computer gap B. Performance gap C. Dashboard gap D. Problems and opportunities

Essay 1. Discuss the emerging issue of the digital distribution channel occurring in markets in which the product can be converted to digital format. 2. Discuss the impact of supply chain management on marketing. 3. Discuss the trend of the use of multiple channels to gain greater access to end-user customers. 4. Explain the factors that influence the role of personal selling in the Integrated Marketing Communications strategy. 5. Explain the selling and sales support activities involved in the sales process. 6. Explain the communications features of the Internet.