Preview Extract
Chapter 10 Promotion
1) The term ________ refers to balancing efforts between promotion efforts to distribution
channel members and efforts toward end consumers.
A) vertical integration
B) co-marketing
C) disintermediation
D) push-pull marketing
Answer: D
Rationale:
Push-pull marketing refers to a strategy where promotional efforts are directed both towards
distribution channel members (push) and end consumers (pull). Push strategies involve
pushing the product through distribution channels to reach consumers, while pull strategies
involve creating demand among consumers to pull the product through the distribution
channels. Thus, D is the correct answer.
2) Which of the following is the targeted constituency of product manufacturers and service
providers' pull marketing efforts?
A) retailers
B) wholesalers
C) distributors
D) customers
Answer: D
Rationale:
Pull marketing efforts are targeted directly at customers to create demand for the product or
service, encouraging them to seek it out from retailers or other intermediaries. This contrasts
with push marketing, which targets intermediaries to stock and promote the product.
Therefore, D is the correct answer.
3) Which of the following should promotion focus on during the introductory phase of a
product's life cycle?
A) emphasizing differentiation of the organization's product or service compared to those of
competitors
B) targeting the late majority type of customer
C) gauging the impact of competitors in the market
D) building awareness for the product, and developing a market for it
Answer: D
Rationale:
During the introductory phase of a product's life cycle, promotion should primarily focus on
building awareness for the product and developing a market for it. This includes educating
consumers about the product's features, benefits, and value proposition. Options A, B, and C
are not as relevant during the introductory phase, as the primary goal is to establish the
product in the market. Therefore, D is the correct answer.
4) Which of the following consumer segments should promotion target at the introduction
stage of the product life cycle?
A) laggards
B) up-and-comers
C) late majority customers
D) early adopters
Answer: D
Rationale:
During the introduction stage of the product life cycle, promotion should target early
adopters, who are the first to adopt a new product or technology. They are willing to take
risks and try new things, making them ideal targets for promotional efforts aimed at building
awareness and generating initial sales. Options A, C, and D represent later stages of product
adoption and are not the primary focus during the introduction stage. Therefore, D is the
correct answer.
5) Which of the following is the focus of push marketing at the introduction stage of the
product life cycle?
A) payment of a minimal fee to retailers to include the product in their store
B) exhibition of product superiority over competitors' offerings
C) familiarization of consumers with product functionality
D) product demonstration by company representatives at retailer stores
Answer: D
Rationale:
During the introduction stage of the product life cycle, push marketing efforts often involve
product demonstration by company representatives at retailer stores. This is aimed at
influencing retailers to stock the product and educate them about its features and benefits,
which can then be communicated to consumers. Options A, B, and C are not specific to the
push strategy and may apply to other stages of the product life cycle. Therefore, D is the
correct answer.
6) Which of the following is the focus of pull marketing at the introduction stage of the
product life cycle?
A) showing how the organization's product is superior to others in the market
B) offering incentives to consumers for using the product
C) cutting costs of promotion by eliminating pull marketing efforts
D) educating consumers on the benefits of the new product
Answer: D
Rationale:
At the introduction stage of the product life cycle, pull marketing focuses on educating
consumers about the benefits of the new product and generating interest and demand among
them. This involves communicating the unique value proposition of the product to consumers
to encourage them to seek it out. Options A, B, and C are not typically the primary focus
during the introduction stage. Therefore, D is the correct answer.
7) Which of the following segments should promotion target at the growth stage of the
product life cycle?
A) innovators
B) up-and-comers
C) early adopters
D) early majority customers
Answer: D
Rationale:
During the growth stage of the product life cycle, promotion should target the early majority
customers. These customers are more risk-averse than innovators and early adopters but are
still willing to try new products once they have been established in the market. Therefore, D
is the correct answer.
8) Which of the following is the focus of push marketing at the growth stage of the product
life cycle?
A) reduction in the amount of incentives given to intermediaries in a bid to cut costs
B) provision of trade margins and other incentives to encourage product adoption
C) payment of a minimal fee to retailers to include the product in their stores
D) highlighting of the organization's product superiority compared to those of competitors
Answer: D
Rationale:
At the growth stage of the product life cycle, push marketing focuses on highlighting the
organization's product superiority compared to those of competitors. This is aimed at
maintaining or increasing market share as competition intensifies. Options A, B, and C are
not typically associated with the push strategy during this stage. Therefore, D is the correct
answer.
9) Which of the following is the focus of pull marketing at the growth stage of the product
life cycle?
A) showing how the organization's product is superior to others in the market
B) offering incentives such as sales promotions to consumers for using the product
C) cutting costs of promotion by eliminating pull marketing efforts
D) educating consumers on the benefits of the new product
Answer: A
Rationale:
At the growth stage of the product life cycle, pull marketing focuses on showing how the
organization's product is superior to others in the market. This involves emphasizing the
unique features and benefits of the product to attract and retain customers in a competitive
market environment. Options B, C, and D are not typically associated with the pull strategy
during this stage. Therefore, A is the correct answer.
10) Which of the following segments should promotion target at the maturity stage of the
product life cycle?
A) innovators
B) up-and-comers
C) late majority customers
D) early adopters
Answer: C
Rationale:
At the maturity stage of the product life cycle, promotion should target the late majority
customers. These customers are more conservative and tend to adopt products only after they
have become well-established and widely accepted in the market. Therefore, C is the correct
answer.
11) Which of the following is the focus of push marketing at the maturity stage of the product
life cycle?
A) payment of a minimal fee to retailers to include the product in their store
B) exhibition of product superiority over competitors' offerings
C) familiarization of consumers with product functionality
D) product demonstration by company representatives at retailer stores
Answer: B
Rationale:
At the maturity stage of the product life cycle, push marketing focuses on exhibiting the
product superiority over competitors' offerings. This is crucial as competition is likely to be
intense, and companies need to differentiate their products to maintain market share. Option
B aligns with this strategy, whereas options A, C, and D may not be as effective in addressing
the competitive landscape during this stage. Therefore, B is the correct answer.
12) Which of the following is the focus of pull marketing at the maturity stage of the product
life cycle?
A) showing how the organization's product is superior to others in the market
B) offering incentives such as sales promotions to consumers for using the product
C) cutting costs of promotion by eliminating pull marketing efforts
D) educating consumers on the benefits of the new product
Answer: A
Rationale:
At the maturity stage of the product life cycle, pull marketing focuses on showing how the
organization's product is superior to others in the market. This involves emphasizing the
unique features and benefits of the product to maintain or increase consumer interest and
loyalty. Option A aligns with this strategy, whereas options B, C, and D may not effectively
address the competitive environment during this stage. Therefore, A is the correct answer.
13) Which of the following segments should promotion target at the decline stage of the
product life cycle?
A) laggards
B) up-and-comers
C) late majority customers
D) early adopters
Answer: A
Rationale:
At the decline stage of the product life cycle, promotion should target laggards, who are the
last to adopt a product or technology. These individuals are typically resistant to change and
may still be using older alternatives. Therefore, A is the correct answer.
14) Which of the following is the focus of push marketing at the decline stage of the product
life cycle?
A) payment of a minimal fee to retailers to include the product in their store
B) exhibition of product superiority over competitors' offerings
C) familiarization of consumers with product functionality
D) product demonstration by company representatives at retailer stores
Answer: A
Rationale:
At the decline stage of the product life cycle, push marketing focuses on strategies to
maintain distribution channels and ensure the product remains available to consumers. Paying
a minimal fee to retailers to include the product in their stores can help maintain visibility and
accessibility despite declining demand. Options B, C, and D are less relevant during this
stage. Therefore, A is the correct answer.
15) Which of the following is the focus of pull marketing at the decline stage of the product
life cycle?
A) showing how the organization's product is superior to others in the market
B) offering incentives such as sales promotions to consumers for using the product
C) cutting costs of promotion by eliminating pull marketing efforts
D) educating consumers on the benefits of the new product
Answer: C
Rationale:
At the decline stage of the product life cycle, pull marketing efforts may focus on cutting
costs by eliminating pull marketing efforts. Since demand is decreasing, it may not be costeffective to continue aggressive marketing campaigns. Instead, companies may choose to
reduce marketing expenditures while maintaining minimal efforts to sustain the product's
presence in the market. Therefore, C is the correct answer.
16) ________ is broadly defined as any paid form of nonpersonal promotion by an identified
sponsor.
A) Publicity
B) Direct marketing
C) Public relations
D) Advertising
Answer: D
Rationale:
Advertising is the correct answer because it involves any paid form of nonpersonal promotion
by an identified sponsor. This distinguishes it from other forms of promotion like publicity,
which is not paid for, direct marketing, which is more personalized, and public relations,
which involves managing relationships with various stakeholders but may not always involve
direct payment for promotion.
17) Advertising vehicles are generally recommended for situations requiring ________.
A) personal interaction
B) reputation management
C) short-term boosts in sales
D) pervasiveness and credibility
Answer: D
Rationale:
Advertising vehicles are recommended for situations requiring pervasiveness and credibility.
Advertising allows companies to reach a wide audience and establish credibility through
consistent messaging and branding. Options A, B, and C are not typically associated with the
primary strengths of advertising.
18) Which of the following is a feature of traditional "conversations" from organizations'
websites?
A) They employ a many-to-many model of conversation.
B) The content on these websites is created by users.
C) They provide tools to rate or air opinions about their products.
D) They allow no convenient means of engaging in a conversation about any topic.
Answer: D
Rationale:
Traditional "conversations" from organizations' websites often lack convenient means of
engaging in a conversation about any topic. These websites typically present information in a
one-way manner without interactive features for user engagement. Options A, B, and C
describe features that are more characteristic of modern social media platforms rather than
traditional organizational websites.
19) Which of the following is a feature of social media and digital marketing techniques?
A) They employ a one-to-many model of conversation.
B) The content on these websites is created by a central authority and others are expected to
come to the websites to read about it.
C) They provide tools to rate or air opinions about their products.
D) They allow no convenient means of engaging in a conversation about any topic.
Answer: C
Rationale:
Social media and digital marketing techniques often provide tools to rate or air opinions
about products, allowing for user-generated content and interaction. This is a characteristic
feature of these platforms, enabling two-way communication between organizations and their
audience. Option A is incorrect because social media typically facilitates many-to-many
conversations. Option B is incorrect because content on social media platforms is often usergenerated rather than solely created by a central authority. Option D is incorrect because
social media platforms are designed for easy engagement and conversation.
20) ________ are short-term incentives that companies give to entice people to purchase
particular products or services.
A) Advertisements
B) Trade margins
C) Loyalty programs
D) Sales promotions
Answer: D
Rationale:
Sales promotions are short-term incentives given by companies to entice people to purchase
specific products or services. These incentives could include discounts, coupons, free
samples, or limited-time offers. Options A, B, and C refer to different marketing strategies or
tools but are not specifically focused on short-term incentives for purchase.
21) Which of the following situations is best suited for the use of social media and digital
marketing techniques as a promotional tool?
A) situations involving expensive complex products
B) situations involving high involvement products and services
C) situations requiring a boost in sales in the short term
D) situations in which information must be timely
Answer: D
Rationale:
Social media and digital marketing techniques are best suited for situations in which
information must be timely. These platforms allow for rapid dissemination of information,
real-time engagement with customers, and the ability to react swiftly to changing
circumstances or events. Options A, B, and C may benefit from other marketing strategies,
but social media and digital marketing are particularly effective when timely communication
is crucial.
22) Which of the following situations is best suited for the use of sales promotions as a
promotional tool?
A) situations in which brand perceptions are based on thought leadership
B) situations requiring an improvement in the company's perceived reputation
C) situations in which some level of interactivity is desired by customers
D) situations requiring a boost in sales in the short term
Answer: D
Rationale:
Sales promotions are best suited for situations requiring a boost in sales in the short term.
These promotions, such as discounts, coupons, or limited-time offers, are effective at
stimulating immediate purchases and driving short-term revenue. Options A, B, and C may
require other promotional tools to address brand perceptions, reputation, or interactivity.
23) ________ is the set of activities that companies use to build and maintain their
reputations in the media.
A) Personal sales
B) Sales promotions
C) Direct marketing efforts
D) Public relations
Answer: D
Rationale:
Public relations is the set of activities that companies use to build and maintain their
reputations in the media. This includes managing communication with the public, media
relations, crisis management, and strategic communication to enhance the company's image
and reputation.
24) Which of the following situations is best suited for the use of public relations as a
promotional tool?
A) situations requiring a short-term boost in sales
B) situations requiring an improvement in a company's perceived reputation
C) situations in which some level of interactivity is desired by customers
D) situations involving high involvement products and services
Answer: B
Rationale:
Public relations is best suited for situations requiring an improvement in a company's
perceived reputation. This could involve managing public perception, addressing negative
publicity or crises, promoting positive stories about the company, and fostering goodwill with
stakeholders. Options A, C, and D may require other promotional tools to address short-term
sales, interactivity, or high involvement products.
25) Which of the following situations is best suited for the use of events and experiences as a
promotional tool?
A) selling high involvement products and services
B) providing timely and accurate information about the organization
C) boosting sales of a product or services in the short term
D) developing personal relationships with brands
Answer: D
Rationale:
Events and experiences are best suited for developing personal relationships with brands. By
creating memorable experiences, companies can engage consumers on a deeper level, foster
emotional connections, and build brand loyalty. Options A, B, and C may benefit from other
promotional tools such as advertising, digital marketing, or sales promotions.
26) Which of the following promotion vehicles uses messages targeted to, and delivered to,
individual customers?
A) sales promotions
B) advertising
C) public relations
D) direct marketing
Answer: D
Rationale:
Direct marketing is the promotion vehicle that uses messages targeted to, and delivered to,
individual customers. It involves personalized communication through various channels such
as email, direct mail, telemarketing, or SMS messaging to engage with specific recipients.
Options A, B, and C typically target broader audiences rather than individual customers.
27) Which of the following situations is best suited for the use of direct marketing as a
promotional tool?
A) situations requiring developing personal relationships with other brands
B) situations requiring an improvement in the company's perceived reputation
C) situations involving sales of high involvement products and services
D) situations where some level of interactivity is desired
Answer: D
Rationale:
Direct marketing is best suited for situations where some level of interactivity is desired. This
includes scenarios where companies aim to engage with individual customers directly, gather
feedback, and tailor messages based on customer preferences. Options A, B, and C may
require other promotional tools to address relationship-building, reputation management, or
high involvement products.
28) ________ is a sales approach where company representatives interact directly with the
prospect.
A) Direct marketing
B) Public relations
C) Sales promotion
D) Personal selling
Answer: D
Rationale:
Personal selling is the sales approach where company representatives interact directly with
the prospect. This involves face-to-face communication, relationship-building, and
addressing customer needs and objections in real-time. Options A, B, and C represent
different promotional activities but do not involve direct interaction between company
representatives and prospects.
29) Which of the following situations is best suited for the use of personal selling as a
promotional tool?
A) situations in which brand perceptions are based on thought leadership
B) situations requiring a short-term boost in sales
C) situations requiring an improvement in the company's perceived reputation
D) situations involving sale of expensive complex products
Answer: D
Rationale:
Personal selling is best suited for situations involving the sale of expensive complex products.
These products often require detailed explanations, customization, and consultation, which
can be effectively provided through direct interaction between sales representatives and
potential customers. Options A, B, and C may not necessarily require the level of personal
engagement characteristic of personal selling.
30) Which of the following products is best suited for a personal selling approach?
A) soft drinks
B) stationery
C) groceries
D) automobiles
Answer: D
Rationale:
Automobiles are best suited for a personal selling approach due to their high value,
complexity, and the need for personalized consultation during the sales process. Sales
representatives can provide detailed information, address customer concerns, and facilitate
test drives, which are crucial in the automotive purchasing decision. Options A, B, and C are
typically low-involvement products that may not require the same level of personal selling.
31) In ________, the organization seeks to acquaint the audience with important facts about
the organization's offering.
A) persuasive advertising
B) reminder advertising
C) reinforcement advertising
D) informative advertising
Answer: D
Rationale:
Informative advertising seeks to acquaint the audience with important facts about the
organization's offering. It focuses on providing information about the product or service, its
features, benefits, and uses, without necessarily persuading or reminding the audience.
Options A, B, and C are different types of advertising strategies that serve different purposes.
32) Informative advertising works well for ________.
A) eliminating negative perceptions about a brand and reinforcing positive ones
B) demonstrating a brand's superiority over its competitor brands
C) stimulating repeat purchase behavior of products or services already launched in the
market
D) building brand awareness and for introduction of new products and services
Answer: D
Rationale:
Informative advertising works well for building brand awareness and for the introduction of
new products and services. By providing valuable information about the product or service,
informative advertising helps consumers understand its features, benefits, and value
proposition, thereby generating interest and awareness. Options A, B, and C describe
objectives or scenarios that may be better suited for other types of advertising strategies.
33) NetKart is a newly launched online bookstore. The firm embarks on an advertising
campaign with a view to introduce its services to online customers and build awareness of its
brand. Which of the following advertising objectives is the most appropriate for NetKart?
A) informative advertising
B) persuasive advertising
C) reinforcement advertising
D) reminder advertising
Answer: A
Rationale:
The most appropriate advertising objective for NetKart, a newly launched online bookstore
seeking to introduce its services and build brand awareness, is informative advertising.
Informative advertising will help communicate important information about NetKart's
services, such as its offerings, features, benefits, and how customers can access and use its
platform.
34) The ________ objective attempts to create liking and stimulate purchase of a product or
service.
A) informative advertising
B) reminder advertising
C) reinforcement advertising
D) persuasive advertising
Answer: D
Rationale:
The persuasive advertising objective attempts to create liking and stimulate the purchase of a
product or service. It focuses on influencing consumer attitudes and preferences, convincing
them to choose the advertised product or service over alternatives. Options A, B, and C
represent different advertising objectives that serve other purposes.
35) Persuasive advertising works well for ________.
A) eliminating negative perceptions about a brand and reinforcing positive ones
B) reassuring current purchasers that they have made the correct decision
C) stimulating repeat purchase behavior of products or services already launched in the
market
D) building brand awareness and for introduction of new products and services
Answer: A
Rationale:
Persuasive advertising works well for eliminating negative perceptions about a brand and
reinforcing positive ones. It aims to influence consumer attitudes and perceptions, shaping
their views of the brand and encouraging favorable opinions. Options B, C, and D describe
scenarios that may be better suited for other types of advertising strategies.
36) Which of the following is consistent with the persuasive advertising objective?
A) advertisements introducing a new variant of a popular dishwashing liquid
B) advertisements congratulating and thanking the first million buyers of a successful car
brand
C) advertisements asking buyers of a computer printer brand to use only authentic ink
cartridges
D) advertisements comparing a brand of anti-dandruff shampoo favorably with its
competitors' brands
Answer: D
Rationale:
Option D is consistent with the persuasive advertising objective as it involves comparing a
brand of anti-dandruff shampoo favorably with its competitors' brands. Persuasive advertising
aims to influence consumer attitudes and preferences, often by presenting the advertised
product or service in a favorable light compared to competitors. Options A, B, and C may
serve different advertising objectives such as introduction, gratitude, or advocacy, but they do
not directly involve persuasion through comparison with competitors.
37) In ________ advertising, the company seeks to stimulate repeat purchase behavior of
products or services already launched in the market.
A) informative
B) reinforcement
C) persuasive
D) reminder
Answer: D
Rationale:
In reminder advertising, the company seeks to stimulate repeat purchase behavior of products
or services already launched in the market. Reminder advertising reminds customers about
the product or service, encouraging them to make repeat purchases. This type of advertising
is particularly effective for maintaining brand awareness and encouraging brand loyalty.
38) The reminder advertising approach works well for ________.
A) situations involving introduction of new products and services
B) situations involving reinforcement of positive perceptions of a brand
C) situations involving favorable comparison of a brand with its rival brands
D) situations involving brand loyalty and long-term sales
Answer: D
Rationale:
The reminder advertising approach works well for situations involving brand loyalty and
long-term sales. Reminder advertising helps maintain brand awareness and encourages repeat
purchases from existing customers. It is less focused on introducing new products or services
or comparing brands with competitors, but rather on reinforcing the brand's presence in the
minds of consumers.
39) The ________ advertising objective attempts to convince current purchasers that they
have made the right decision.
A) informative
B) persuasive
C) reminder
D) reinforcement
Answer: D
Rationale:
The reinforcement advertising objective attempts to convince current purchasers that they
have made the right decision. It aims to reinforce positive perceptions of the brand and
reassure customers about their choice, encouraging repeat purchases and fostering brand
loyalty. Options A, B, and C represent different advertising objectives that serve other
purposes.
40) Which of the following brands is best suited for a reinforcement advertising objective?
A) a brand of trekking shoes
B) a brand of backpacks
C) a brand of beverage
D) a brand of high-end phones
Answer: D
Rationale:
A brand of high-end phones is best suited for a reinforcement advertising objective. High-end
phones often involve significant investment by consumers, and reinforcement advertising can
help reassure current purchasers that they have made the right decision. It can emphasize the
premium features, performance, and status associated with the brand, encouraging repeat
purchases and brand loyalty. Options A, B, and C may also benefit from reinforcement
advertising, but high-end phones typically involve more significant consideration and may
require more reassurance.
41) Which of the following factors necessitates higher advertising budgets?
A) low market share
B) high perceived differentiation among competing brands
C) low competition in the market
D) low frequency of advertising
Answer: A
Rationale:
Low market share necessitates higher advertising budgets because companies need to invest
more in advertising to increase awareness, visibility, and market penetration for their products
or services. Higher advertising budgets help them compete effectively in the market and gain
share from competitors. Options B, C, and D may not necessarily require higher advertising
budgets.
42) Which of the following factors supports the decision by large companies to move their
advertising work in-house?
A) Huge amounts are being spent on media, such as television, radio, and print ads.
B) Greater objectivity is needed in the advertising process and in-house team can be swayed
by internal organizational factors.
C) Greater creative skills are required to advertise the product and in-house team is drawn
from several departments involved in product development.
D) The advertised product is complex in operation and function and it is expensive to train
external agency members.
Answer: D
Rationale:
The complexity of the advertised product's operation and function, coupled with the expense
of training external agency members, supports the decision by large companies to move their
advertising work in-house. By having an in-house team familiar with the product and its
nuances, companies can ensure effective communication and reduce the costs associated with
external agencies. Options A, B, and C describe factors that may not necessarily lead to the
decision to move advertising work in-house.
43) Which of the following is an advantage of using television as an advertising medium?
A) high reach
B) long exposure time
C) low clutter
D) low advertising costs
Answer: A
Rationale:
High reach is an advantage of using television as an advertising medium. Television has the
ability to reach a large and diverse audience across different demographics, making it
effective for mass communication and brand exposure. Options B, C, and D do not accurately
reflect the advantages of television advertising.
44) Which of the following is an advantage of using radio as an advertising medium?
A) long exposure time
B) high attention rate
C) long lead time
D) high selectivity
Answer: D
Rationale:
High selectivity is an advantage of using radio as an advertising medium. Radio allows
advertisers to target specific demographics, geographic areas, and listener profiles, making it
effective for reaching niche audiences. Options A, B, and C do not accurately describe the
advantages of radio advertising.
45) Which of the following is a disadvantage of using magazines as an advertising medium?
A) low exposure time
B) low attention rate
C) low selectivity
D) long lead times for ads
Answer: D
Rationale:
Long lead times for ads is a disadvantage of using magazines as an advertising medium.
Magazines typically have longer production cycles, requiring advertisers to plan and book ad
placements well in advance. This may limit flexibility and responsiveness to changes in the
market or advertising strategy. Options A, B, and C do not accurately describe the
disadvantages of magazine advertising.
46) Which of the following is an advantage of using Yellow Pages as an advertising medium?
A) low clutter
B) short lead times
C) mass market coverage
D) high credibility
Answer: D
Rationale:
High credibility is an advantage of using Yellow Pages as an advertising medium. Yellow
Pages listings are often perceived as trustworthy and reliable sources of information by
consumers seeking local businesses and services. This credibility can enhance the
effectiveness of advertising placed within the Yellow Pages directory. Options A, B, and C do
not accurately describe the advantages of Yellow Pages advertising.
47) Which of the following is a limitation of using product placement as an advertising
medium?
A) non-captive audience
B) low reach
C) high clutter
D) high costs
Answer: D
Rationale:
High costs are a limitation of using product placement as an advertising medium. Securing
placement of products within media content, such as films, TV shows, or video games, often
requires significant financial investment, especially for prominent or strategic placements.
Options A, B, and C do not accurately describe the limitations of product placement.
48) ________ seeks to increase customer revenue through increasing transitions from Web
surfer to paying customer.
A) Semantic targeting
B) Search engine optimization
C) Enterprise search marketing
D) Conversion rate optimization
Answer: D
Rationale:
Conversion rate optimization seeks to increase customer revenue through increasing
transitions from Web surfer to paying customer. It involves optimizing various elements of a
website or digital platform to improve the likelihood of visitors completing desired actions,
such as making a purchase or signing up for a service. Options A, B, and C describe other
marketing techniques or strategies unrelated to conversion rate optimization.
49) Search engine marketing works well for ________.
A) targeting customers using keywords that apply as many segments as possible
B) promoting products that are generally considered to be mass-market goods
C) improving organic search rankings of search engines by adjusting content on company
websites
D) gathering feedback on the relevance of the company's messaging
Answer: D
Rationale:
Search engine marketing works well for gathering feedback on the relevance of the
company's messaging. Through techniques such as pay-per-click advertising and keyword
targeting, search engine marketing allows companies to gauge the effectiveness of their
messaging by analyzing user interactions, search queries, and conversion rates. Options A, B,
and C describe other aspects or objectives of search engine marketing.
50) ________ is a marketing technique that encourages the spreading of messages to increase
visibility.
A) Grassroots marketing
B) Affinity marketing
C) Frequency marketing
D) Viral marketing
Answer: D
Rationale:
Viral marketing is a marketing technique that encourages the spreading of messages to
increase visibility. By creating content that resonates with audiences and motivates them to
share it with others, viral marketing campaigns can rapidly reach a wide audience and
generate significant exposure for a brand or product. Options A, B, and C describe other
marketing techniques unrelated to viral marketing.
51) ________ is an advertising approach that scans the text of recently viewed websites for
keywords and delivers ads targeting those keywords.
A) Keyword advertising
B) Semantic advertising
C) Viral advertising
D) Contextual advertising
Answer: D
Rationale:
Contextual advertising is an advertising approach that scans the text of recently viewed
websites for keywords and delivers ads targeting those keywords. This type of advertising
aims to match ads with the content of the webpage or the interests of the user, increasing the
relevance of the ads and the likelihood of engagement. Options A, B, and C describe other
advertising approaches unrelated to contextual advertising.
52) Social networking sites are best suited for ________.
A) demonstrating thought leadership
B) improving conversion rates
C) demonstrating product operation
D) building a network of business contacts
Answer: D
Rationale:
Social networking sites are best suited for building a network of business contacts. These
platforms provide opportunities for professionals to connect, interact, and build relationships
with others in their industry or related fields. While social networking sites can serve various
purposes, including thought leadership and product demonstration, their primary strength lies
in facilitating networking and relationship-building activities.
53) Sites such as Flickr and YouTube are best suited for ________.
A) engaging with customers
B) obtaining consumer feedback
C) improving conversion rates
D) driving website traffic
Answer: D
Rationale:
Sites such as Flickr and YouTube are best suited for driving website traffic. These platforms
are popular for hosting visual content, including images and videos, which can attract users'
attention and encourage them to visit associated websites or channels for more information.
While engagement, feedback, and conversion may occur on these platforms, their primary
role in marketing is often to drive traffic to other online properties.
54) Which of the following tactics is best suited for inducing customer trial of a product?
A) giving away coupons targeted to users of a competing brand
B) conducting contests and games and providing rebates
C) giving away coupons targeted to users of the brand
D) providing free samples of the product
Answer: D
Rationale:
Providing free samples of the product is the best tactic for inducing customer trial. By
offering consumers the opportunity to try the product at no cost, companies can overcome
barriers to trial, showcase the product's benefits, and potentially convert trial users into
regular customers. Options A, B, and C may incentivize purchase or engagement but do not
offer the same direct experience of the product as free samples.
55) Which of the following sales promotion tactics is best suited for achieving the marketing
objective of increased consumption of a product?
A) giving away free samples of the product
B) offering rebates and discounts
C) giving coupons targeted to users of a competing brand
D) providing supersize discounts
Answer: D
Rationale:
Providing supersize discounts is the best sales promotion tactic for achieving the marketing
objective of increased consumption of a product. Supersize discounts incentivize customers
to purchase larger quantities of the product by offering cost savings for bulk purchases. This
can lead to increased consumption and higher sales volume. Options A, B, and C may
stimulate purchase or trial but do not specifically target increased consumption as directly as
supersize discounts.
56) Which of the following sales promotion tactics is recommended to a manufacturer whose
marketing objective is to liquidate inventories?
A) offering free trips to channel members
B) offering trade allowances
C) offering free cases of a product for trial
D) offering discount off list price for a certain time period
Answer: D
Rationale:
Offering discount off the list price for a certain time period is recommended to a
manufacturer whose marketing objective is to liquidate inventories. This tactic encourages
consumers to make purchases by providing a financial incentive through reduced prices,
helping the manufacturer quickly sell excess inventory. Options A, B, and C may not be as
effective for achieving the specific objective of inventory liquidation.
57) Which of the following event tactics is recommended to a firm whose marketing
objective is to build brand awareness?
A) organizing hospitality tents at events
B) throwing launch parties
C) increasing merchandising and promotion efforts
D) giving away samples at an event
Answer: D
Rationale:
Giving away samples at an event is recommended to a firm whose marketing objective is to
build brand awareness. Sampling allows consumers to experience the product firsthand,
creating positive associations with the brand and increasing awareness through direct
interaction. Options A, B, and C may contribute to brand visibility but may not have the same
direct impact on brand awareness as sampling.
58) Which of the following direct marketing tactics best helps a firm promote cross-selling?
A) varying the number of product features
B) emphasizing product features
C) varying the order of product features
D) analyzing purchase history of the product
Answer: D
Rationale:
Analyzing purchase history of the product is the best direct marketing tactic to promote crossselling. By analyzing customer purchase behavior, firms can identify patterns and
preferences, allowing them to tailor cross-selling strategies to offer complementary products
or services that align with customers' needs and interests. Options A, B, and C focus on
product features rather than customer behavior and purchasing history.
59) Which of the following situations is a contractual sales force best suited for?
A) stable markets
B) long sales cycles
C) long-term sales boosts
D) introductory life cycle stage
Answer: D
Rationale:
A contractual sales force is best suited for the introductory life cycle stage of a product.
During this stage, sales volume may be uncertain, and hiring a permanent sales force may not
be cost-effective. Contractual sales representatives provide flexibility and scalability,
allowing the firm to adjust resources based on the evolving needs of the market without longterm commitments. Options A, B, and C may benefit from other types of sales forces.
60) For which of the following situations is an in-house sales force best suited?
A) introductory life cycle stage of product
B) unstable markets
C) short-term sales boosts
D) long sales cycles
Answer: D
Rationale:
An in-house sales force is best suited for situations involving long sales cycles. Long sales
cycles often require ongoing relationship-building, customer education, and personalized
sales approaches, which can be effectively managed by a dedicated in-house sales team.
Options A, B, and C may not require the same level of ongoing sales support as long sales
cycles.
61) During the introductory stage of the product life cycle, promotion should emphasize
differentiation of the organization's product or service compared to those of competitors.
Answer: False
Rationale:
During the introductory stage, promotion should focus on building awareness for the product
and developing a market for it rather than emphasizing differentiation. The primary goal is to
educate consumers about the new product and its benefits, rather than directly comparing it to
competitors' offerings.
62) The maturity stage of the product life cycle often incurs a higher promotion budget than
other stages of the life cycle.
Answer: True
Rationale:
During the maturity stage, competition intensifies as the market becomes saturated with
similar products. To maintain market share and prevent sales decline, companies often
increase their promotional efforts, leading to higher promotion budgets compared to other
stages of the product life cycle.
63) During the decline stage of the product life cycle, pull marketing is generally eliminated
altogether.
Answer: True
Rationale:
During the decline stage, when sales are decreasing, companies often reduce or eliminate pull
marketing efforts as they focus on liquidating remaining inventory or phasing out the product.
Pull marketing strategies are less effective in a declining market where consumer demand is
decreasing.
64) Advertising is broadly defined as any paid form of personal promotion by an identified
sponsor.
Answer: False
Rationale:
Advertising is not considered personal promotion. Personal promotion involves direct
communication between a company representative and an individual customer. Advertising,
on the other hand, involves non-personal communication through various media channels to
reach a target audience.
65) Event sponsorship works well for developing personal relationships with brands and for
engaging with promotion-weary audiences.
Answer: True
Rationale:
Event sponsorship provides opportunities for brands to engage with audiences in a more
personal and interactive manner, fostering relationships and creating positive associations
with the brand. Additionally, event sponsorship allows brands to reach audiences who may be
weary of traditional advertising methods, offering a more engaging and memorable
experience.
66) Personal selling is well suited for situations involving routine, inexpensive products and
low-involvement products and services.
Answer: False
Rationale:
Personal selling is generally more effective for complex, expensive, or high-involvement
products and services where the sales process requires personalized interaction, education,
and persuasion. It may not be cost-effective for routine or low-involvement products where
mass marketing or other promotional methods suffice.
67) When an advertiser seeks to differentiate its product offering from that of a competitor,
the advertiser's objective is persuasive advertising.
Answer: True
Rationale:
Persuasive advertising aims to differentiate a product by highlighting its unique features,
benefits, or advantages over competitors' offerings. By persuading consumers of the product's
superiority, advertisers seek to influence their purchasing decisions and gain a competitive
edge in the market.
68) Reinforcement advertising approach works well for products that require significant
knowledge to maximize their usefulness.
Answer: True
Rationale:
Reinforcement advertising aims to remind or reinforce existing customers about the benefits
and value of a product they are already familiar with. For products that require significant
knowledge or expertise to maximize their usefulness, reinforcement advertising helps
maintain customer loyalty, encourage repeat purchases, and reinforce the brand's positioning
in the market.
69) Brands with lower market share generally require lower advertising budgets, as a
percentage of sales, than those with high market share.
Answer: False
Rationale:
Brands with lower market share often need to invest more in advertising to increase brand
awareness, gain market share, and compete effectively with larger competitors. As a result,
they may allocate a higher percentage of their sales revenue to advertising compared to
brands with high market share, which may benefit from economies of scale and alreadyestablished brand recognition.
70) A large company that wishes to advertise its highly complex product is more likely to use
an external advertising agency than an in-house advertising team.
Answer: False
Rationale:
A large company with a highly complex product may prefer to utilize an in-house advertising
team rather than an external agency. In-house teams offer greater control, understanding of
the product, and flexibility to tailor advertising strategies to the company's specific needs and
objectives. Additionally, for highly specialized products, an in-house team may possess the
expertise required to effectively communicate the product's features and benefits to the target
audience.
71) Printed magazines offer excellent psychographic and geographic selectivity.
Answer: True
Rationale:
Printed magazines often cater to specific audiences based on their interests, demographics,
and geographic locations. Advertisers can select magazines that align with their target
market's psychographic characteristics (such as interests, lifestyles, and values) and
geographic locations, allowing for precise targeting and maximizing the effectiveness of
advertising campaigns.
72) Search engine marketing improves "organic search" rankings of search engines by
adjusting content on company website pages, editing website HTML, and making other
changes, such as adding links toward the site.
Answer: False
Rationale:
Search engine marketing primarily involves paid advertising efforts to improve a website's
visibility in search engine results pages (SERPs) through techniques such as pay-per-click
(PPC) advertising and keyword targeting. Improving "organic search" rankings, on the other
hand, is typically achieved through search engine optimization (SEO), which focuses on
optimizing website content, structure, and other factors to enhance its visibility in unpaid
(organic) search results.
73) Increased use of discounts, rebates, and coupons erodes brand equity by lowering the
consumer's perception of value for the brand.
Answer: True
Rationale:
Excessive use of discounts, rebates, and coupons can lead consumers to perceive the brand as
less valuable or prestigious, potentially eroding brand equity over time. Consumers may
become accustomed to purchasing the brand only when discounts are available, diminishing
their willingness to pay full price and undermining the brand's perceived value in the market.
74) By providing trade allowances and discounts, manufacturers can eliminate inventories to
make room for a new product.
Answer: False
Rationale:
Providing trade allowances and discounts may help manufacturers reduce inventory levels
temporarily by stimulating demand among retailers or distributors. However, it does not
directly address the need to make room for a new product. Inventory management strategies,
such as liquidation sales, product discontinuation, or inventory optimization, are typically
employed to clear existing inventory and make way for new products.
75) Public relations is the practice of managing the communications between an organization
and its internal stakeholders (such as employees, labor unions, and shareholders) and external
stakeholders (such as customers, communities, and the media).
Answer: True
Rationale:
Public relations (PR) involves managing and maintaining the relationships between an
organization and its various stakeholders, both internal and external. This includes activities
such as media relations, crisis management, community engagement, employee
communications, and investor relations, all aimed at building and protecting the
organization's reputation and fostering positive relationships with stakeholders.
76) PR tactics such as mentions of the organization in major news outlets and public service
activities help boost sales of the organization's products in the market.
Answer: False
Rationale:
While PR tactics such as media mentions and public service activities can enhance brand
visibility and reputation, their direct impact on boosting sales is often indirect and difficult to
measure. PR activities primarily focus on building relationships, generating positive
publicity, and shaping public perception, which may contribute to long-term brand equity and
market presence but may not directly drive immediate sales increases.
77) The supply-side measurement of event effectiveness approximates the amount of time or
physical space devoted to media coverage of the brand during the event.
Answer: True
Rationale:
Supply-side measurement of event effectiveness focuses on quantifying the media exposure
generated by the event, such as the amount of time or physical space dedicated to coverage of
the brand in various media outlets (e.g., TV, radio, newspapers, online news). This metric
helps evaluate the reach and visibility of the brand as a result of its participation in the event
from the perspective of media coverage.
78) Marketers can gather market feedback on the effectiveness of direct marketing efforts by
measuring response rates with different tactics.
Answer: True
Rationale:
Response rates to direct marketing tactics, such as email campaigns, direct mailings, or online
advertisements, provide valuable feedback on the effectiveness of the marketing efforts. By
analyzing response rates, marketers can assess factors such as message clarity, offer
relevance, audience targeting, and overall campaign performance, enabling them to refine
their strategies and improve future marketing initiatives.
79) Contractual sales forces work well in situations where sales force sizes stay relatively
constant over time.
Answer: False
Rationale:
Contractual sales forces provide flexibility in adjusting sales force sizes based on fluctuating
market conditions, seasonal demand, or specific project requirements. They are particularly
suitable for situations where sales force needs may vary over time or where additional
resources are needed temporarily to support specific sales initiatives, making them less
suitable for situations where sales force sizes remain constant.
80) In-house sales forces are best suited for situations involving stable markets and short
sales cycles.
Answer: False
Rationale:
In-house sales forces are generally better suited for situations involving complex products or
services, long sales cycles, or where close coordination between sales and other internal
departments is required. They provide greater control, alignment with company objectives,
and direct oversight over sales activities. Stable markets and short sales cycles may not
necessarily require the same level of dedicated in-house sales resources.
81) What is push-pull marketing?
Answer: The balancing efforts between promotion efforts to distribution channel members
(push) and efforts toward end consumers (pull) is known as push-pull marketing. Companies
(product manufacturers and service providers) apply push marketing toward distribution
channel members, such as wholesalers and retailers, to motivate intermediaries to carry,
promote, and sell the company's products and services. In pull marketing, companies use
advertising and other promotion techniques to persuade customers to demand the company's
products and services from intermediaries, thus "pulling" the products and services through
intermediaries.
82) Why is integrated marketing communications important to marketers?
Answer: Marketers should establish a consistent message throughout each element of the mix
to ensure integrated marketing communications (IMC). In an effective IMC approach, each
element is telling a part of a cohesive story. Maintaining consistent messaging throughout the
elements can improve the cost-effectiveness of our marketing communications budget,
because each element synergistically supports the other.
83) Describe the role of advertising in marketing communications.
Answer: One of the most popular forms of marketing communications is advertising.
Advertising is broadly defined as any paid form of nonpersonal promotion by an identified
sponsor. Advertising vehicles are generally recommended for situations requiring
pervasiveness (advertising reaches a wide audience, with multiple exposures) and credibility
(organizations which advertise are perceived as more credible than those that do not, because
it shows that the company is serious about developing its market).
84) How does media spend affect the decision to use an external advertising agency?
Answer: Smaller amounts spent on media (such as television, radio, or print ads) are less
economically attractive to external agencies, because many agencies take a commission
(often near 15 percent) of the amount spent on media.
85) Describe the terms: media reach, media frequency, and media impact.
Answer: Media reach refers to the audience size (number of different people) exposed to a
particular message at least once during a specified time period. Media frequency is the
number of times an average person is exposed to the message within the time period. Media
impact is the qualitative value of the exposure through a given medium. Multiplied together,
they result in a weighted number of exposures, which can be interpreted as the total number
of exposures a target audience member sees the ad, weighted by the impact value of the
medium.
86) What is product placement? What are its advantages and limitations as an advertising
medium?
Answer: In product placement, audiences watching movies and television shows see the
product in an everyday situation, which helps gain exposure for the product as well as relate
to it. Video games reach captive audiences—if they want to play the game, they will be
exposed to the ad. Product placement can be selective as well—the choice of film to
showcase the product can determine its target market. The limitations include its high cost
and growing resentment to overly aggressive product placement in many shows.
87) Write a brief note on blogs as an advertising medium.
Answer: Blogs (Weblogs) hold several promising promotion opportunities for companies.
Company blogs can be used to engage with customers in an open forum, to demonstrate
thought leadership through expert opinion blog posts of relevant topics, to communicate
announcements (such as product introductions or new customers), and to clear up
misconceptions about the company in the market.
Blogs can also provide consumer feedback, especially blogs with high volumes of user
interaction, such as microblog site Twitter. Companies must monitor non-company blogs for
critical postings, using tools such as Google's Blog Search product.
88) How can organizations use consumer promotions to increase consumption of their
products?
Answer: Companies can motivate consumers to increase their consumption through sales
targeted to key events (such as back to school sales), or by discounting the purchase of large
amounts of product. For example, fast-food restaurants offer "supersize" discounts for
consumers who purchase bundled offerings of products, such as hamburgers, French fries,
and soft drinks.
89) What are the sales-oriented PR tactics that organizations can use to boost sales of their
products?
Answer: Sales-oriented PR tactics include SEO-enabled press releases (press releases with
embedded relevant search keywords), creating message platforms (aiding sales through
consistent messaging), and company-created content (such as brochures and annual reports).
Some public relations agencies also participate in lobbying efforts to influence or change
public policy in a way that benefits sales (or at least prevents new legislation that could
reduce sales). For example, cellular phone companies actively lobbied Congress not to pass
restrictive cell phone legislation for drivers.
90) How do companies use events to target niche markets?
Answer: Companies can target niche markets by creating or sponsoring events that cater to
that market. For example, Subaru sponsors several outdoors-related niche markets (skiers,
snowboarders, and mountain bikers) to show how its four-wheel drive cars are relevant to
their adventurous lifestyle. Different events tactics include lifestyle events (such as the
Subaru example), geographically related events (such as sponsoring a surfing competition on
the coastline), or demographically related events (such as targeting teenaged consumers at a
teen-oriented event).
91) Describe the roles of direct marketing and personal selling in marketing communications.
Answer: In direct marketing, marketing messages are targeted to individual consumers.
Companies reach out directly to customers using personal contact channels, such as
telephone, email, and postal mail. An example of a direct marketing effort would include an
email message from clothing retailer Men's Wearhouse. Direct marketing works well for
situations where customers value relevant information (customers can "opt-in" for updates
and promotions they find useful), where communications should be timely (messages can be
prepared and sent quickly), and where some level of interactivity is desired (customers are
encouraged to reply to the messages).
In personal selling, a company representative interacts directly with the prospect. The
approach is well suited for situations involving expensive complex products (such as
automobiles, sold by salespeople at auto dealerships), high involvement products and services
(such as homes, sold by realtors), and where longer-term relationships are a goal (such as
many service organizations, which emphasize personal selling to facilitate repeat business).
92) Describe the four different types of advertising objectives with examples.
Answer:
• Informative Advertising: In informative advertising, the organization seeks to acquaint the
audience with important facts about the organization's offering. For example, financial
services giant Chase featured television and radio commercials informing the public of its
new QuickDeposit service, where consumers can deposit checks by taking photos of them
using their Apple iPhone or Android-powered smartphone. This type of objective works well
for building brand awareness (by informing the audience about aspects of the brand they
might not have known) and for the introduction of new products and services (by informing
the audience about what makes this new offering special).
• Persuasive Advertising: The persuasive advertising objective attempts to create liking and
stimulate purchase of a product or service. Advertisements comparing one brand with another
are popular tactics for this type of objective. For example, S.C.Johnson ran print ads
comparing its Ziploc brand of resealable plastic bags with those of competitors,
demonstrating how the poor seal of the other bags resulted in food spoilage. The objective
works well for building brand preference (by making the audience like the brand more than
those of competitors) and brand attitudes (by reinforcing positive attitudes toward the brand
and eliminating negative ones).
• Reminder Advertising: In reminder advertising, the company seeks to stimulate repeat
purchase behavior of products or services already launched in the market. For example,
Frontier Airlines sends email messages on a regular basis to customers, reminding them of
the low fares the airline has made available to selected destinations. The approach works well
for situations involving brand loyalty (by asking customers to stay true to their brand) and
long-term sales (by reminding the audience to use the product or service).
• Reinforcement Advertising: The reinforcement advertising objective attempts to convince
current purchasers that they have made the right decision. For example, Bay Alarm security
monitoring services provider typically places a sign reading "Bay Alarm/Since 1946" on the
front yard of the monitored property, reinforcing the company's long-term commitment to
security. The objective works well for high-involvement products such as cars (by
congratulating them on purchasing such a fine automobile) and products that require
significant knowledge to maximize their usefulness (by urging customers to read the manual
and learn about the product's dazzling capabilities).
93) What are the different factors that influence advertising budgets?
Answer: The required size of the organization's advertising budget is often influenced by
several factors. When deciding upon a budget to cover advertising expenses, those factors can
impact the level of spending required to successfully introduce a new product or service and
keep it successful throughout its life cycle.
• Life Cycle Stage: Generally, new products and services require higher budgets, because
they require expensive efforts to boost awareness and encourage customer trial. Mature
products and services generally require lower amounts of funding as a percentage of sales.
Declining products can have high amounts of funding as a percentage of sales (despite lower
total expenditures), due to the declining period's lower sales volume.
• Market Share: Brands with lower market share generally require higher advertising budgets,
as a percentage of sales, than those with high market share, because the sales rate is lower.
• Competition: Brands in highly competitive markets must advertise more heavily to remain
on customers' consideration lists.
• Advertising Frequency: Brands in markets subjected to significant amounts of advertising,
such as those of consumer packaged goods, generally must advertise more frequently to reach
its audience with a designated number of repetitions. Higher frequency results in higher
budgets.
• Product Substitutability: Brands in markets where offerings are perceived as nearly identical
(such as the market for airline services) require higher budgets to emphasize their
differentiation.
94) Briefly describe search engine optimization (SEO) and search engine marketing (SEM).
Answer: Search engine optimization (SEO) improves "organic search" (non-paid search)
rankings of search engines (such as Google) by adjusting content on company website pages,
editing website HTML (hypertext markup language, the language of Web pages), and making
other changes, such as adding links toward the site. SEO increases company visibility (so
prospects know about it), boosts sales to target markets (by using specific keywords relevant
to those markets), and enhances company credibility (by associating it with relevant
keywords).
Search engine marketing (SEM), also called pay per click (PPC) advertising (such as
Google's SEM offering, AdWords), places ads in search engine results that correspond to a
user's search. SEM allows businesses to create advertising using keywords related to their
business, which are displayed during user searches. SEM works well for niche marketing
(keywords can be very specific to niche markets), where conversion rates must be increased
(businesses can target customers likely to buy by using relevant keywords), and gathering
feedback on the relevance of the company's messaging (SEM analytics show the
effectiveness of different messaging campaigns).
95) How are trade promotions used by companies to achieve their marketing objectives?
Answer:
• Increase distribution: Manufacturers can increase distribution by persuading the trade to
carry their product lines. Persuasion tools typically include trade allowances, payments, or
discounts offered in return for the retailer's agreement to feature the manufacturer's products.
Manufacturers might also offer free cases of product to the retailer to introduce the brand to
the retailer.
• Increase trade support: To continue the support of trade members in the carrying of their
brand, manufacturers can periodically offer price-offs (discounts from list price) for a certain
time period.
• Liquidate inventories: If the manufacturer plans to launch a new type of product, it might
decide to eliminate inventories of existing products using a variety of techniques, such as
rebates.
• Increase goodwill: Manufacturers who wish to improve relations with distribution channel
members can offer goodwill gestures. Some approaches include offering free cases of product
for trade members who buy a certain quantity or who feature a certain flavor or size.
Manufacturers can also offer sales contests, such as free trips to top-selling channel members.
Test Bank for Marketing Planning
Stephan Sorger
9780132544702
