Midterm Exam, Mark 6361, Fall 2007

Name: __________________________________

UH ID:__________________________________Please write your UH ID# on the scantron as well and blacken the matching circles.

Multiple Choice: Each questions worth 2 points. Choose the one alternative that best completes the statement or answers the question.

1. What distinguishes a panel from other sources of market research data, we said in class, is the fact that panel data:

a. are free b. come from businesses, not consumers c. come from consumers, not businesses d. come from the same respondents in different time periodse. reflect behavior, not opinions

2. Marketers selling to organizations are likely to encounter inelastic demand, we said in class. Therefore:

a. Personal relationships will not be important b. Price cuts may not increase total salesc. Salespeople may “adjust” their forecasting estimatesd. Compared to consumer marketing, buyers will be smaller and more

widely dispersed geographicallye. Purchases by governments will not be factor in total sales

3. Brand can play a number of specific roles within a company’s brand portfolio. For example, a __________ is positioned to compete directly with one or more competitors’ brands so that more important and profitable brands retain their desired positioning.

a. cash cowb. mid-market brandc. low end, entry level brandd. high end, prestige brande. flanker

4. A ___________ occurs when the parent brand is used on a new product targeting a new market segment within a category currently served by the parent.

a. joint venture co-brandb. line extension.c. category extensiond. multiple sponsor co-brande. same company co-brand

5. _________ is the ability to prepare, on a mass basis, individually designed products to meet each customer’s requirements.

a. Concentrated marketingb. Clustered marketingc. Specializedd. Nichinge. Mass customization

6. __________ has been defined as a deeply held commitment to re-buy or re-patronize a preferred product or service in the future despite situational influences and marketing efforts having the potential to cause switching behavior.

a. Delightb. “Deep” satisfactionc. Satisfactiond. Loyaltye. Value delivery

7. Frequency programs acknowledge that ________ of a company’s customers may well account for _____ of its business.

a. less than 5 percent; nearly allb. 75 percent; a slight majorityc. most; mostd. 30 percent; 50 percente. 20 percent; 80 percent

8. To enhance its marketing efforts, a wise marketer makes it _____ to complain.a. easyb. very difficultc. moderately difficultd. a two-step processe. None of the above. Since complaints are not positive, companies

should discourage them altogether.

9. Fidelity Investments puts through certain customers’ calls more quickly than others to improve the value of the company’s customer base. While on the phone, the longer-waiting customers hear messages encouraging them to complete their transaction via the company web site. This is an example of

a. Enhancing the potential growth potential of each customer.b. Making low-profit customers more profitable.c. Increasing the longevity of the customer relationship d. Managing phone queues via illegal and discriminatory practicese. Reducing customer defection rate.

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10. Which is true of competitive advantage?a. Benjamin Franklin first talked about it.b. It is the ability to copy the best practices of other companiesc. Being the fastest to the market guarantees competitive advantage,

according to Porter’s Five Forcesd. Companies that hope to endure must continually invent new

advantages.e. A characteristic that is of no importance to customers can be a

customer advantage.

11. Which of following is true?a. If marketers raise expectations too high, the buyer is likely to

be disappointed.b. If the company sets expectations too low, the buyer is likely to be

disappointed.c. If marketers raise expectations too high, they will soon have many

copycat offerings competing in the marketplace.d. If marketers raise expectations too high, they won’t attract enough

customers.e. If the company sets expectations too low, exceeding buyers’

expectation becomes difficult.

12. ________ are trademarkable devices that identify and differentiate the brand.a. Brand equitiesb. Intellectual propertiesc. Brand promisesd. Brand elementse. Consumer knowledge bases

13. Marketers are advised to define a strategic business unit (SBU) in terms of :a. production process employed, key material(s) employed, price

levelb. customer groups served, customer needs met, technology

employedc. relative market share, length of time the company has been in this

business, uniqueness of its offering compared to competitorsd. management strength, autonomy within the parent company,

relation of this SBU’s products to the company’s other products e. price, product, promotion, and distribution

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14. According to the work of Frederick Herzberg ________.a. Marketers can use laddering to determine the appropriate appeal to

be used in their adsb. A person moves from stated instrumental motivation to terminal

ones.c. A bottle of Estee Lauder perfume arouses a different set of motives

in consumers than an Avon perfume.d. Polite store clerks will not necessarily be a satisfier for a

consumer, but impolite ones would be a dissatisfier.e. People are driven by particular needs at particular times.

15. Which of the following is an example of a behavioral segmentation variable?a. Education levelb. Family life cyclec. Stage of readiness to buyd. Lifestylee. Occupation

16. Aaron’s hunting and fishing activities, his interest in military history, and his opinions about an all-volunteer army reflect his _________.

a. demographicsb. personalityc. social classd. lifestyle e. self-concept

17. A new supplier is least likely to make a sale to a prospect involved in which of the following buying situations?

a. Direct purchaseb. Functional rebuyc. Modified rebuyd. Straight rebuye. New task

18. Advertising usually has its greatest impact at the ___________ stage of new task buying.

a. trialb. adoptionc. interestd. awareness See page 105.e. evaluation

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19. A(n) _______ establishes a long-term relationship in which the supplier promises to re-supply the buyer as needed at agreed upon prices over a specified period.

a. over-run contractb. purchase order contractc. blanket contractd. superior order contracte. specialized contract

20. The point of showing in class that a bank might target those newly divorced or a school of nursing might target men was to emphasize the potential payoff from:

a. casting as wide a net as possibleb. selecting related segments to target – two or more with obvious

similaritiesc. focusing on one segmentd. directing marketing efforts to the largest possible segmente. directing marketing efforts to the segment closest to the

organization’s current customer base

21. When we talked about stars, dogs, cash cows, and the like, we made the point thata. it is useful for a company to relocate periodicallyb. it makes sense to earn surplus cash with some products and

invest that cash in other productsc. tax considerations should be included in marketing decisionsd. growth markets are the least profitablee. companies with high market share relative to competitors have the

most difficult time gaining profits

22. We talked in class about PRIZM to make the point thata. Lifestyle segmentation is easier to accomplish than demographic

segmentationb. Segmentation by types of neighborhoods can be helpful for

finding similar segments in different citiesc. Demographic segmentation is only helpful for retailersd. Demographic segmentation considers activities, interests, opinions

e. A segment and a sector are different words for the same concept

23. Marketing strategy has three elements, we said in class:a. concentration, development, and diversityb. sales potential, sales budgets, and sales forecastsc. markets to target, products to offer, and differential advantage

over competitorsd. attaining, retaining, and growing customerse. customer identification, customer relationship management, and

customer experience management

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24. The marketing activity particularly concerned with consumer learning and memory, we said in class, is

a. product mix selectionb. choosing channels of distributionc. designing packagingd. designing advertisinge. planning pricing

25. To win back lost customers, the textbook recommendsa. immediate action – call to ask what problem led to their defectionb. delayed action – waiting a month or two, so the customer can

assess how they view their new supplierc. price cuts as the only useful method once a customer has selected a

new supplierd. raising prices, so the customer will see the company as higher in

qualitye. changing the product, so the customer will not object to a higher

price

26. Marketers should consider the political-legal environment becausea. legislation affecting businesses decreases over time, and it is wise

to seek opportunities as regulations expireb. marketing transactions are unaffected by pressure groupsc. legal departments are not involved in marketing issues and leave

them to marketing managersd. special interest groups are declining in influencee. competitive behavior, product safety, and product labeling are

regulated

27. The textbook suggests improving the quality of marketing intelligence bya. establishing a consumer advisory panelb. asking competitors to share pricing plans, in exchange for sharing

one’s own pricing plans with themc. replacing the purchase of information such as scanner data with

survey datad. using a “trial and error” approach to marketing decisionse. avoiding observational data and focus groups

28. Based on environmental considerations, marketers should be concerned with a. promoting branded products over ‘store brand’ substitutes b. helping shoppers to justify visits to stores rather than purchasing

from Websites c. increasing the number of disposable items in the product mixd. increasing prices to reduce unnecessary consumptione. learning how buyers use and dispose of products

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29. The textbook recommends increasing “structural ties” with buyers. An example, for an airline, would be

a. promoting a Visa card that awards miles flown on that airline b. price reductions on specific, less popular routesc. increasing the number of flights on more popular routesd. creating a “low price, low frills” airline with the same ownership

but a different brand namee. raising prices, to add prestige to flying that particular airline

30. Thinkers, achievers, strivers, and similar categories are terms associated witha. income, education, and other variables measured by the U.S.

Census b. primary motivation and resources, within the VALS Networkc. Zip codesd. sector of the U.S. in which these segments are found

e. the North American Industrial Classification System (NAICS)

Please turn over this page to answer short-answer questions.

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Please BRIEFLY answer each question. Each answer is worth up to 10 points each. Complete sentences are not necessary. Be sure you say SOMETHING in response to each question.

31. Michael Porter lists five factors that determine the attractiveness of a market (you could also think of it as an industry) in which an organization might decide to compete – or not to. Please list any four of the five (I stop reading after four.)

You got five points for showing up. Then you got one point additional for each correct answer – or five altogether if you got them all. See pp. 161-2, where it tells you that Porter lists threats of intense segment rivalry, of new entrants, of substitute products, of the bargaining power of buyers, and the bargaining power of suppliers.

32. To be useful, says the textbook and a slide we discussed, methods of segmenting a market must rate favorably on five key criteria. Please list any four of those criteria (I stop reading after four) and in one sentence, explain the meaning of any one of the four (just one, please, but make clear which one) to a college sophomore.

You got five points for showing up. Then you got one additional point for each correct answer. This was the slide with pink ovals, or as listed on pp. 127-128 market segments must be measurable, substantial, accessible, differentiable (please notice what that means), and actionable.

33. The textbook and a slide we discussed in class list five stages in the consumer buying process, beginning with problem recognition. Please list any three of the other four (I stop reading after three), and suggest for a bicycle retailer how marketing dollars could be effectively employed in targeting consumers at the problem recognition stage.

You’re getting the picture….5 points for showing up, then in a diagram you will see at the top of p. 92 the stages are listed: problem recognition was followed by information search, evaluation of alternatives, purchase decision, postpurchase behavior. The bicycle retailer needs to help people see that they need a bike, a second bike, or a new bike – however that would be done. It could NOT be done by designing a “better” bike – retailers don’t do that, right? You got one point added to the 5 for each correct answer, or 5 if you got them all correct.

34. Explain “derived demand” to a college sophomore, briefly, and why it matters in forecasting sales for any business-to-business marketer.

Again, 5 points automatic. Most people did either OK or well on this. For a full 10 points I had to see some reference to the customer’s customers, but I gave partial credit for knowing something to indicate an understanding that demand for one set of offerings might depend on demand for another.

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