Marketing Management

Amity Centre for eLearning

ASSIGNMENT
PROGRAM: Master of Business Administration (3 year) SEMESTER-I
Subject Name Permanent Enrollment Number (PEN): Roll Number (SEN) Student Name : : : Marketing Management

INSTRUCTIONS a) Students are required to submit all three assignment sets. ASSIGNMENT Assignment A Assignment B Assignment C DETAILS Five Subjective Questions Three Subjective Questions + Case Study 40 Objective Questions MARKS 10 10 10

b) Total weightage given to these assignments is 30%. OR 30 Marks c) All assignments are to be completed as typed in word/pdf. d) All questions are required to be attempted. e) All the three assignments are to be completed by due dates (specified from time to time) and need to be submitted for evaluation by Amity University. ( ) Tick mark in front of the assignments submitted Assignment A Assignment B Assignment C

Copyright 2010 Amity University

ASSIGNMENT A
Qns 1: the length of the product life cycle is governed by the rate of technological change, the rate of market acceptance and the case of competitive entry Discuss. Ans.: It is claimed that every product has a life period, it is launched, it grows, and at
some point, may die. A fair comment is that - at least in the short term - not all products or services die. Jeans may die, but clothes probably will not. Legal services or medical services may die, but depending on the social and political climate, probably will not. Even though its validity is questionable, it can offer a useful 'model' for managers to keep at the back of their mind. Indeed, if their products are in the introductory or growth phases, or in that of decline, it perhaps should be at the front of their mind; for the predominant features of these phases may be those revolving around such life and death. Between these two extremes, it is salutary for them to have that vision of mortality in front of them. However, the most important aspect of product life-cycles is that, even under normal conditions, to all practical intents and purposes they often do not exist (hence, there needs to be more emphasis on model/reality mappings). In most markets the majority of the major brands have held their position for at least two decades. The dominant product lifecycle, that of the brand leaders which almost monopolize many markets, is therefore one of continuity. The stages through which individual products develop over time is called commonly known as the" Product Life Cycle". The classic product life cycle has four stages (illustrated in the diagram below): introduction; growth; maturity and Decline.

Introduction Stage: At the Introduction (or development) Stage market size and growth
is slight. it is possible that substantial research and development costs have been incurred in getting the product to this stage. In addition, marketing costs may be high in order to test the market, undergo launch promotion and set up distribution channels. It is highly unlikely that companies will make profits on products at the Introduction Stage. Products at this stage have to be carefully monitored to ensure that they start to grow. Otherwise, the best option may be to withdraw or end the product.

Growth Stage: The Growth Stage is characterized by rapid growth in sales and profits.
Profits arise due to an increase in output (economies of scale)and possibly better prices. At this stage, it is cheaper for businesses to invest in increasing their market share as well as enjoying the overall growth of the market. Accordingly, significant promotional resources are traditionally invested in products that are firmly in the Growth Stage.

Maturity Stage: The Maturity Stage is, perhaps, the most common stage for all markets.
it is in this stage that competition is most intense as companies fight to maintain their market share. Here, both marketing and finance become key activities. Marketing spend has to be monitored carefully, since any significant moves are likely to be copied by competitors. The Maturity Stage is the time when most profit is earned by the market as a whole. Any expenditure on research and development is likely to be restricted to product modification and improvement and perhaps to improve production efficiency and quality.

Decline Stage: In the Decline Stage, the market is shrinking, reducing the overall
amount of profit that can be shared amongst the remaining competitors. At this stage, great care has to be taken to manage the product carefully. It may be possible to take out some production cost, to transfer production to a cheaper facility, sell the product into other, cheaper markets. Care should be taken to control the amount of stocks of the product. Ultimately, depending on whether the product remains profitable, a company may decide to end the product.

Following characteristics can be seen in the product life-cycle concept

1. Each product or good has a life-cycle like human beings, plants and animals. 2. The life-cycle of each product begins from its presentation in the market and passes through market development, maturity, becomes leader and ultimately declines. 3. The speed of movement through various stages of life-cycle can not be the same for all goods.

4. Many profits in the business enterprise grow quickly in the introduction stage and decline/decrease in the maturity stage due to competitive conditions. However there is overall increase in sale during the maturity stage. 5. With the change in profits in the maturity stage change in the life-cycle of product likeEngineering and Research, Production, Marketing and Financial Control Activities etc. essential.

Qns 2. The marketing concept is a customer orientation backed by integrated marketing aimed at generating customer satisfaction as the key to satisfying organizational goals. Comment. Ans:
According to Philip Kotler, The marketing concept is a consumer orientation

backed by integrated marketing aimed at generating customer satisfaction as the keyto satisfying organizational goals

The American Marketing Association defines Marketing asthe process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy the perceived needs, wants, and objectives of the customer and the organization. In simple words, Marketing is the process of finding, satisfying, and retaining customers while the business meets its goals It is a fundamental idea of marketing that organizations survive and prosper through meeting the needs and wants of customers. This important perspective is commonly known as the marketing concept. The marketing concept is about matching a company's capabilities with customer wants. This matching process takes place in what is called the marketing environment. Businesses do not undertake marketing activities alone. They face threats from competitors, and changes in the political, economic, social and technological environment. All these factors have to be taken into account as a business tries to match its capabilities with the needs and wants of its target customers. An organization that adopts the marketing concept accepts the needs of potential customers as the basis for its operations. Success is dependent on satisfying customer needs.

What are customer needs and wants? A need is a basic requirement that an individual wishes to satisfy. People have basic needs for food, shelter, affection, esteem and self-development. Many of these needs are created from human biology and the nature of social relationships. Customer needs are, therefore, very broad. Whilst customer needs are broad, customer wants are usually quite narrow. A want is a desire for a specific product or service to satisfy the underlying need.

Consider this example: Consumers need to eat when they are hungry. What they want to eat and in what kind of environment will vary enormously. For some, eating at McDonalds satisfies the need to meet hunger. For others a microwave readymeal meets the need. Some consumers are never satisfied unless their food comes served with a bottle of fine Chardonnay. Consumer wants are shaped by social and cultural forces, the media and marketing activities of businesses. This leads onto another important concept - that of customer demands: Consumer demand is a want for a specific product supported by an ability and willingness to pay for it. For example, many consumers around the globe want a Mercedes. But relatively few are able and willing to buy one. Businesses therefore have not only to make products that consumers want, but they also have to make them affordable to a sufficient number to create profitable demand. Businesses do not create customer needs or the social status in which customer needs are influenced. It is not McDonalds that makes people hungry. However, businesses do try to influence demand by designing products and services that are Attractive Work well Are affordable Are available

Businesses also try to communicate the relevant features of their products through advertising and other marketing promotion. Which leads us finally to an important summary point? A marketing orientated business is one that which has adopted the marketing concept.

Qns 3. What are major reasons for market segmentation and what are its advantages? Ans:
Market segmentation is a concept in economics and marketing. A market

segment is a sub-set of a market made up of people or organizations with one or more characteristics that cause them to demand similar product and/or services based on qualities of those products such as price or function. A true market segment meets all of the following criteria: it is distinct from other segments (different segments have different needs), it is homogeneous within the segment (exhibits common needs); it responds similarly to a market stimulus, and it can be reached by a market intervention. Market Segmentation can be done on the basis of the location (Geographic Segmentation); on the basis of age, income, gender and other measurable factors (Demographic Segmentation); on the basis of lifestyle, likes, dislikes, taste and preferences (Psychological Segmentation); and according to the history, loyalty and responsiveness (Behavioral Segmentation). A business must analyze the different needs of the market segments; their internal strengths and weaknesses; external opportunities and threats; and various others factors like the mission, vision, values, beliefs, attitudes, norms and standards of the organization; as well as the competitors strategy, social and cultural factors, economic environment, global perspective, demographic environment, technological and political / legal aspects before deciding their own niche. Philip Kotler mentioned five criteria for an effective segmentation which states that Segmentation should be: 1. Measurable: - it should be possible to determine the values of the variable used for the segmentation. 2. Relevant: - it should justify the expected profits and the growth potential. 3. Accessible: - the target customers must be reachable and servable for the organization. 4. Distinguishable: - the target audiences must be diverse and able to show different reactions to different marketing mix.

5. Feasible: - the firm must have an ability to draw an effective marketing program for its
customers.

The following are the advantages of Market Segmentation for a firm:

a) Helps in better understanding of the customers needs and wants. b) Better targeting and position of the product. c) Encourages two-way communication among the potential buyer and the organization. d) Maintaining effective relationship with the customers. e) Retaining the existing customers and attracting new ones. f) Improving service delivery standards. g) Reducing cost / expenses on various marketing activities and increases market share; resulting in higher profits.

Qns 4. Briefly explain the steps involved in new product development. Ans: Developing and introducing a new product can be quite scary, risky, demanding,
even a roller-coaster ride. Often, what began as a great new product idea becomes unrecognizable when that once-great idea gets to store shelves.

Step 1 Insight Finding and Identification: he key to finding a big new insight
understands consumer needs, wants, and how they view and use the category. Trying to "sell the consume" on your views is seldom successful; but listening to their language and watching their actions will point you straight to terrific new insights. For example, Procter &Gamble's efforts in 1985 to create a bold new advertising campaign for Folgers to catapult it into market leadership began by watching consumers make coffee and by listening to their descriptions of their process of waking up in the morning. From these efforts came the insight that people actually wake up to the smell of coffee before they get to the taste And, thus was born "The best part of waking up" The insight worked so well, it's still guiding the marketing campaign today - twenty years later. Ask yourself, what about your product or organization triggers an emotional response stronger than the commodity itself. But, successful marketing and brand executives know that they don't have to go it alone.

Once you have possible insights identified, these insights should be objectively and quantifiably tested to determine if they are truly bold, new insights. This should be done before writing concepts as there is a totally different set of questions necessary to identify the potential of an insight. A lesson: Only when the insights are determined to truly have ground breaking potential should you proceed to the concept development phase.

Step 2 Concept Development/Screening: truly good insight has the ability to

be executed in many different ways. If you can develop only one possible concept from an insight, it is simply not an insight. Insights allow for multiple executions, so once you have identified these directions, you can develop the concept executions and screen them to find the most compelling (and unique) delivery of your insight.

Step 3 Product Development/Quantification: Having identified the right

concept, developing the product to deliver on the promises of the concept, i.e.: delivering the insight through the product performance is key. The product must live up to the promises made in the concept or the business proposition will fail. At this stage concept fulfillment, cannibalization estimates, and volumetric can tell you if you have been successful. Again, Folgers provides an excellent example of a product working to fulfill the original insight. P&G developed a special "aroma-roast" process that guaranteed they were getting as much great coffee aroma from each bean as humanly possible. And, they've continued to use the original insight, when recently the company came out with a special "aroma-seal" can that keeps the beans fresh and aromatic remaining consistent with the brand promise throughout innovation.

Step 4 Advertising Development/Screening: This stage is too late for the

advertising or public relations agency to get involved and start re-interpreting the products benefits. Good marketing communications should "sell" the insight. If the product's unique selling proposition is not conveyed in the advertising, it is a waste of money. By engaging the agency in the development process they can aid in guiding the project and will be in a much better position to write copy that is true to the insight. Working closely at the conceptual stage with the brand research and brand marketing agency is critical as advertising is not the place for trial and error. Screening multiple campaigns to objectively find the one that does this best is key. Not only should the winning campaign be motivating and unique, it should convey new information, communicate the features and benefits that are most important (that is the ones that consumers have already indicated they bought into), and it should generate the emotional reaction necessary to get consumers to bond with the brand. Each element is part of a successful advertising testing effort.

Step 5 Packaging Development/Screening: For many brands packaging is

the primary, if not the only, advertising the consumer will see. Packaging development needs to clearly focus on the insight and sell the benefits that come out of this. Like advertising, your packaging agency must understand the insight work and not try to re-interpret the direction. And, like advertising, multiple packaging options should be considered to find the direction that is most motivating, unique, does the best job of communicating benefits, and leaves consumers with the favorable emotional reaction you are looking to achieve. A brand packaging firm should be brought into the equation early in the process before final concepts are designed, allowing the packaging firm to offer best practice advice on 'how' to execute the idea efficiently, effectively and at the best cost. The best idea, unable to be executed or executed at tremendous cost, is not a bargain.

Step 6 - Introductory Marketing/Promotion Materials: These too should be

true to the insight. Having focused on this winning consumer insight so long, why risk it by not telling consumers it is now in their power to buy it. Introduce the product as the breakthrough it is, not just another line extension. Remember, the consumer should always drive your efforts, and when you get off track and the consumers tell you, you must listen. This is the reason you keep checking with them, to make sure you have stayed true to their original guidance. Listen -- this is the single best way to improve your new product, advertising, and packaging efforts.

ASSIGNMENT B
Qns1.Explain a n y two p r i c i n g p o l i c i e s w i t h t h e i r r e l a t i v e a d v a n t a g e s a n d disadvantages. Ans: VALUE-BASED PRICING: Value prices adhere to the thinking that the optimal
selling price is a reflection of a product or service's perceived value by customers, not just the company's costs to produce or provide a product or service. The value of a product or service is derived from customer needs, preferences, expectations, and financial resources as well as from competitors' offerings. Consequently, this approach calls for managers to query customers and research the market to determine how much they value a product or service. In addition, managers must compare their products or services with those of their competitors to identify their value advantages and disadvantages. Yet, value-based pricing is not just creating customer satisfaction or making sales because customer satisfaction may be achieved through discounting alone, a pricing strategy that could also lead to greater sales. However, discounting may not necessarily lead to profitability. Value pricing involves setting prices to increase profitability by tapping into more of a product or service's value attributes. This approach to pricing also depends heavily on strong advertising, especially for new products or services, in order to communicate the value of products or services to customers and to motivate customers to pay more if necessary for the value provided by these products or services.

DEMAND-BASED PRICING: Managers adopting demand-based pricing policies are,

like value pricers, not fully concerned with costs. Instead, they concentrate on the behavior and characteristics of customers and the quality and characteristics of their products or services. Demand-oriented pricing focuses on the level of demand for a product or service, not on the cost of materials, labor, and so forth. According to this pricing policy, managers try to determine the amount of products or services they can sell at different prices. Managers need demand schedules in order to determine prices based on demand. Using demand schedules, managers can figure out which production and sales levels would be the most profitable. To determine the most profitable production and sales levels, managers examine production and marketing costs estimates at different sales levels. The prices are determined by considering the cost estimates at different sales levels and expected revenues from sales volumes associated with projected prices.

The success of this strategy depends on the reliability of demand estimates. Hence, the crucial obstacle managers face with this approach is accurately gauging demand, which requires extensive knowledge of the manifold market factors that may have an impact on the number of products sold. Two common options managers have for obtaining accurate estimates are enlisting the help from either sales representatives or market experts. Managers frequently ask sales representatives to estimate increases or decreases in demand stemming from specific increases or decreases in a product or service's price, since sales representatives generally are attuned to market trends and customer demands. Alternatively, managers can seek the assistance of experts such as market researchers or consultants to provide estimates of sales levels at various unit prices.

Qns 2. As Marketing Director of Kelloggs evolve market driven distribution system for the market. Ans: Marketing channel strategy is rapidly emerging as a very powerful tool for
companies searching to gain a decisive competitive edge.

More and more companies today realize that in order to devise optimal marketing channels, they first need to know what an ideal, totally customer driven system would look like, disregarding the fact that such models are usually not feasible and, for that reason, rarely see the light of day. The ideal system, based on exacting customer research and unimpeded by external considerations and constraints, is intended purely as a yardstick by which a companys marketing channel performance can be most accurately evaluated. More importantly, it helps to measure the distance between ideal and present practices and/or obstacles to closing the gap. The method most widely used to create this new scientific context in which top management can decide its companys future marketing channel strategy, involves eight steps.

Step one the customers wants Preliminary research determines what customers really want from the buying process. Their preferences generally fall into five categories, ie lot size, market

decentralization, waiting time, product variety and service backup. These are then grouped into market segments.

Step two label outlets Focus here is on the relationship between market segments and the outlets where services are normally delivered. Respondents are asked about the service outlets they visualize as ideally meeting their needs/wants. Researchers then label these hypothetical outlets according to segments, but without limiting their possibilities. The more researchers are creative with labeling, the better step two will work.

Step three the feasibility test Having determined what customers perceive to be optimal shopping conditions, companies now must apply the first objective reality check. This involves:

Assessing whether the previously determined segments are feasible for the company

Determining what kind of support will be needed, and available, from suppliers or other channel participants for any hypothetical outlet suggested by the data, and

Step four how ideal is ideal At this point the researchers have come as close as possible to discerning an ideal market-driven system. Now they investigate how such a channel model would affect the companys overall performance. For this purpose researchers consult a cross section of the companys executives as well as executives with a stake in distribution matters. Inevitably, these groups will want to modify the ideal model to better suit their individual objectives and/or to take into account external issues impacting on the companys scope with respect to distribution policy. These considerations, many of which are based on industrial traditions, act as constraints on the ideal marketing channel strategy and thus are pivotal to further design stages.

Step five comparing the options

The step calls for a comparison between companys existing market channel strategy and a) the ideal, truly market-driven distribution system, and b) the ideal model incorporating managements constraints. One of three conclusions will emerge from these comparisons:

If all three systems resemble one another, the existing strategy is as good as it can get. But if customer satisfaction is mediocre nevertheless, fault lies with implementation.

If the existing and managements systems are similar, but substantially different from the ideal, management policies may indeed be causing the gap.

If all three vary greatly, it may be possible to improve marketing channel performance without relaxing managements objectives and constraints.

Step six reviewing all assumptions Here all constraints are put under the microscope to see which are based on prejudice and assumptions and which are real and serious, and whether they can be overcome. This process is ideally assisted by outside experts, including lawyers, political consultants and distribution experts from other industries. Step seven confronting the gap This is the climax of the process as top management is brought face-to-face with the gap between their preferred model and the ideal marketing channel strategy. Armed with data gained from stage six, researchers challenge the validity of managements objectives and constraints, thus promoting a fresh and energetic appraisal of all quantitative and subjective variables impacting on the choice of distribution system. Step eight implementation This final step modifies the ideal marketing channel strategy according to managements final objectives and constraints. Implementation of this optimal model must be subject to intensive planning and any modifications to the existing system should be tested on a small scale before resources are committed. Ideally none of the eight steps outlined here should be skipped for the sake of apparent expediency because, irrespective of the outcome, the clarity the process brings to companies distribution issues is absolutely invaluable.

Qns 3. Which type of sales promotion vehicles will you use to promote the sale of a premium brand of toilet soap? Ans: Sales promotion, a key ingredient in marketing campaigns, consists of a collection
of incentive tools, mostly short term, designed to stimulate quicker or greater purchase of particular products or services by consumers or the trade. Whereas advertising offers a reason to buy, sales promotion offers an incentive to buy. Sales promotion tools for Toilet Soap: CONSUMER PROMOTION Samples Coupons Cash Refund Offers Prices Off Premiums Prizes Patronage Rewards Free Trials Warranties Tie in Promotions Cross Promotions Point Of Purchase Displays Demonstrations

TRADE PROMOTION BUSINESS AND SALES-FORCE PROMOTION Trade Shows and Conventions Contests for Sales Reps Specialty Advertising Prices Off Advertising and display Allowances Free Goods

CASE STUDY

M.K.B. products was an industrial company, undertaking the manufacture of chewing tobacco products. For the packing of these products, tin containers were required in huge quantities. The company was buying these containers from Shaz Metals, who were supplying the empty containers to M.K.B. products @ Rs. 1.60 per tin container. This arrangement carries on for more than ten years. M.K.B. products were later joined by a young M.B.A., who advised the owner of M.K.B products, to go in for backward integration (To make the tin containers themselves, instead of buying them from Shaz Metal Works. The matter was put under deliberation and it was decided to join for partial backward integration, i.e. to start the manufacture of their own tin containers, as well as, keep buying from the supplier(Shaz Metal) in a lesser quantity, till such time that the company M.K.B. products could become self sufficient. In the pursuit of backward integration, another semiautomatic tin container manufacturing plant was set up by the company, and it started its production and initially faced a lot of teething troubles. They however, overcame them and started functioning smoothly. A number of suppliers were interested in supplying tin sheets for M.K.B. products. After buying randomly from a number of suppliers, the company came to the terms with one Mr. Wali, who undertook all the raw material supplies of the tin sheets to the company at reason able rates. He would make deliveries as and when necessary, and developed a good relationship with the company. This arrangement lasted for a decade. Later, Mr. Wali, the tin supplier told the company that they would be charging an additional two percent on the prices quoted by them and delivery time

would have to be rescheduled and the company would have to pick up, or order for the entire material consumed by the quarterly, instead of monthly arrangements. This sets the company thinking whether to agree to Mr. Wali terms or to look for another supplier. After a little research, they came across a supplier in tin industries, who was happy to supply the goods at same terms and conditions. When the deal was about to finalized with the scrap tin industries, Mr. Wali sent a telegram that the increase in rated was cancelled, and they were willing to renew their contract, or continue with the suppliers at the earlier rate for the next 12 months. This again set the company thinking, because they had good relations with Mr.Wali for a long period of time and also the fact that in industrial buying, market price plays a secondary role but the quality, timely and regular suppliers are the dominant factors. QUESTION S:
1. What

should the company do in this situation and

why? Ans: In my point of view company should stick with Mr. Wali as company
had good relations with Mr. Wali for a long period of time. Another thing that company can do is ti give him the half the order for the time being and give half order to the other vendor, it will give time to company to think and test the other vendor. Because if in near future Mr. Wali again raise the price they can give full order to another vendor.

Should the company try scrap industries who are an unlisted supplier and what precautions should the company take for the future?
2.

Ans:

In my point of view company should not try scrap industries because tin making is

not their main business and they should purchased it from vendor. It will be a waste of time to go and search in scrap industries; instead of this they should focus on their main business. For the future they should not be depend only on one vendor but they should have two to three vendor and give them equal order so that no one can back out at main tim

ASSIGNMENT C

1. All of the following would be ways to segment within the category of psychographic
segmentation EXCEPT: a. social class. b. occupation. c. lifestyle. d. personality. 2. The orange juice manufacturers know that orange juice is most often consumed in the mornings. However, they would like to change this and make the drink acceptable during other time periods during the day. Which form of segmentation would they need to work with and establish strategy reflective of their desires? a. gender segmentation b. benefit segmentation c. occasion segmentation d. age and life-cycle segmentation

3. Using a successful brand name to introduce additional items in a given product category under the same brand name (such as new flavors, forms, colors, added ingredients, or package sizes) is called a(n):

a. line extension.
b. brand extension. c. multibranding. d. new brands. 4. If a company's objective were to reach masses of buyers that were geographically dispersed at a low cost per exposure, the company would likely choose which of the following promotion forms?

a. Advertising
b. Personal selling c. Public relations d. Sales promotion

5. Successful service companies focus their attention on both their customers and their employees. They understand service-profit chains, which links service firm profits with employee and customer satisfaction. a. internal marketing

b. service-profit chains
c. interactive marketing d. service differentiation 6. Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need is called a(n): a. idea. b. demand.

c. product.
d. service. 7. Electronic commerce is the general term for a buying and selling process that is supported by electronic means. a. Internet commerce b. Web commerce c. Computer commerce

d. Electronic commerce
8. Market segmentation consists of dividing a market into distinct groups of buyers on the basis of needs, characteristics, or behavior who might require separate products or marketing mixes. a. Product differentiation

b. Market segmentation
c. Market targeting d. Market positioning 9. Market targeting is the process of evaluating each market segment's attractiveness and selecting one or more segments to enter. a. Mass marketing b. Market segmentation c. Market targeting d. Market positioning

10. The fact that services are sold, produced, and consumed at the same time refers to which of the following service characteristics? a. Intangibility b. Inseparability c. Variability d. Perishability 11. Demographic factors are the most popular bases for segmenting customer groups. a. Geographic b. Demographic c. Psychographic d. Behavioral 12. The stage is the product life cycle that focuses on expanding market and creating product awareness and trial is the: a. decline stage. b. introduction stage. c. growth stage. d. maturity stage. 13. A set of interdependent organizations involved in the process of making a product or service available for use or consumption by the consumer or business user is called a (n): a. retailer. b. wholesaler. c. distribution channel. d. logistics. 14. In evaluating messages for advertising, telling how the product is better than the competing brands aims at making the ad: a. meaningful. b. distinctive. c. believable. d. remembered. 15. Environmental sustainability is the practice of adopting policies and developing strategies that both sustain the environment and produce profits for the company. a. Environmentalism b. Environmental sustainability

c. Consumerism d. Consumer accountability 16. Consumer goods with unique characteristics or brand identification often requiring a special purchase effort are called: a. custom products. b. specialty products. c. convenience products. d. shopping products.

17. A price reduction to buyers who buy in large volumes is called a(n): a. quantity discount. b. cash discount. c. seasonal discount. d. trade discount. 18. R&D and engineering first produce the product concept into a physical product during which of the following stages of the new product development process? a. Concept development and testing b. Marketing strategy c. Business analysis d. Product development 19. The primary reason that many companies work to become the "low-cost producers" in their industry is because: a. they can generate more advertising. b. they can please top management. c. they can gain tax advantages. d. they can set lower prices that result in greater sales and profits. 20. Conflicts between different levels of the same channel of distribution are referred to as: a. horizontal conflicts. b. vertical conflicts. c. layer-based conflicts. d. parallel conflicts.

21. Enlightened marketing is a philosophy holding that a company's marketing should support the best long-run performance of the marketing system. a. Enlightened marketing b. Myopic marketing c. Fundamental marketing d. Conceptual marketing 22. A company is practicing niche marketing if it focuses on sub segments with distinctive traits that may seek a special combination of benefits. a. micromarketing b. niche marketing c. mass marketing d. segment marketing 23. When a company reviews sales, costs, and profit projections for a new product to find out whether these factors satisfy the company's objectives, they are in which of the following new process development stages? a. Concept development and testing. b. Commercialization. c. Business analysis. d. Marketing strategy development. 24. Brand extension is a strategy of using a successful brand name to launch a new or modified product in a new category. a. Duo branding b. Line extension c. Brand extension d. Multibranding 25. The fact that service cannot be stored for later use or sale is evidence of their: a. intangibility. b. inseparability. c. variability. d. perishability. 26. Integrated marketing communications is the concept under which a company carefully integrates and coordinates its many communications channels to deliver a clear, consistent, and compelling message about the organization and its products.

a. The promotion mix b. Integrated international affairs c. Integrated marketing communications d. Integrated demand characteristics 27. The course of a product's sales and profits over its lifetime is called: a. the sales chart. b. the dynamic growth curve. c. the adoption cycle. d. the product life cycle. 28. The type of trade-promotion discount in which manufacturers agree to reduce the price to the retailer in exchange for the retailer's agreement to feature the manufacturer's products in some way is called a(n): a. discount. b. allowance. c. premium. d. rebate. 29. When producers, wholesalers, and retailers act as a unified system, they comprise a: a. conventional marketing system. b. power-based marketing system. c. horizontal marketing system. d. vertical marketing system. 30. Personality is a person's distinguishing psychological characteristics that lead to relatively consistent and lasting responses to his or her own environment. a. Psychographics b. Personality c. Demographics d. Lifestyle 31. Online has the advantage of being high in selectivity; low cost; immediacy; and interactive capabilities. a. Direct Mail b. Outdoor c. Online d. Radio

32. If an advertiser wants flexibility, timeliness, good local market coverage, broad acceptability, and high believability, the advertiser will probably choose which of the following mass media types? a. Newspapers b. Television c. Direct Mail d. Radio 33. A (n) brand is a name, term, sign, symbol, or design, or a combination of these that identifies the maker or seller of a product or service. a. product feature b. sponsorship c. brand d. logo 34. All of the following factors can affect the attractiveness of a market segment EXCEPT: a. the presence of many strong and aggressive competitors. b. the likelihood of government monitoring. c. actual or potential substitute products. d. the power of buyers in the segment. 35. A service is any activity or benefit offered for sale that is essentially intangible and does not result in the ownership of anything. a. demand b. basic staple c. product d. service 36. The production concept holds that consumers will favor products that are available and highly affordable (therefore, work on improving production and distribution efficiency). a. product concept b. production concept c. production cost expansion concept d. marketing concept

37. A company is in the product development stage of the new product development process when the company develops the product concept into a physical product in order to assure that the product idea can be turned into a workable product. a. product development b. commercialization c. marketing strategy d. business analysis 38. The practice of going after a large share of a smaller market or subsets of a few markets is called: a. undifferentiated marketing. b. differentiated marketing. c. concentrated marketing. d. turbo marketing. 39. Idea screening is screening new-product ideas in order to spot good ideas and drop poor ones as soon as possible. a. Idea generation b. Concept development and testing c. Idea screening d. Brainstorming 40. Technological advances, shifts in consumer tastes, and increased competition, all of which reduce demand for a product are typical of which stage in the PLC? a. decline stage b. introduction stage c. growth stage d. maturity stage