1. Fluctuating demand occurs when demand changes slightly in response to a change in consumer demand.
2. Derived demand occurs when demand is derived from the primary buyer of the product.
3.The number of products sold in business markets outnumbers those in consumer markets.
4. B2B markets tend to have shorter decision cycles than B2C markets.
5. B2C markets have smaller total dollar amounts due to fewer transactions.
6. B2B markets place more reliance on personal selling than B2C markets.
7. B2B markets have a large number of sales accounting for most of the company’s sales.
1. B2B markets differ from B2C markets because
a.Salespeople personally call on business customers to a far greater extent than they do consumers.
2. The business market is characterized as having
b. longer decision cycles.
3. _____ is important to Allen’s company because he puts chemicals in laundry detergent.
c. Derived demand
4. As the demand for MP3 players increased, so did the demand for headphones. This is an example of _____.
a. joint demand
1. Institutions purchase lots of products and services.
1. Ethical business behavior is not clear cut.
2. B2B laws and regulations are often monitored by the DOD.
3. The Business Marketing Association has also developed a code of ethics that prohibits bribery and other practices such as disparaging a competitor’s products unfairly and treating one’s suppliers equitably.
4. All things being equal, companies want to do business with firms that are responsible.
5. Ethics come into play in few business settings.
1. The Federal Trade Commission regulates companies
a. In an effort to prevent them from engaging in unfair trade practices that can hamper competition.
2. A firm may not allow purchasing agents to accept gifts from a potential vendor because
d. They don’t want their buyers making decisions based upon personal gain.
3. Firms want to do business with firms that are responsible because
e. They know ethics are important to customers.
1. How companies sell is just as important as what they sell.
2. The lines between retailers, wholesalers, and producers are very easy to distinguish.
3. Wholesalers resell goods to other companies without transforming the goods.
4. Door-to-door sales and telemarketing are examples of direct marketing.
1. All of the people and organizations that buy, resell, and promote a product “downstream” as it makes it to the end user is referred to as the _____.
a. distribution channel
2. A company may partner with intermediaries because
c. the producer needs shipping and handling capabilities.
3. Olive has decided to open up a factory outlet store in rural Alabama. This is known as a _____.
b. manufacturer’s sales branch
4. Mary ran into a store dedicated to the newest cat foods offered by her favorite pet food provider. She had so much fun interacting with the free samples and toys, she decided to bring her cat Fluffy to the store the next week, but it was no longer there. Mary most likely found a _____.
c. pop-up store
5. Frank needs to buy groceries, get a haircut, and stop for lunch. He could accomplish all these things under the same roof if he were to visit a(n) _____.
1. The producer does not market directly to consumers when it is involved in an indirect channel.
2. When creating a marketing channel, the key is understanding the different target markets for your product and designing the best channel to meet the needs of customers in each.
3. Franchising involves granting an independent operator the right to use your manufacturing processes, trade secrets, patents, and trademarks for a certain amount of time in exchange for a fee.
1. Cutting middlemen out of the channel is known as
2. The least risky global entry strategy is known as _____.
3. The most risky global entry strategy is known as _____.
b. direct foreign investment
1. The roles of channel members can vary based on contractual agreements.
2. The problem with a pull strategy is that it doesn’t focus on the needs of the actual users of products.
3. Consumers are informed via advertising and other promotions that a product is available for sale in a push strategy.
1. A strategy utilized by the manufacturer of a good that convinces the wholesaler, distributor, or retailer to sell its products is known as a(n)
a. push strategy.
2. A _____ focuses on communicating the product’s benefits to the consumer so as to create demand that retailers and distributors must meet.
c. pull strategy
3. Often, two or more channel members will work together to promote a product to
d. retailers; purchasing agents; consumers.
1. A company’s prime consideration for selecting channels is how its customers want to buy products.
2. The Internet is hindering companies’ ability to develop customer relationships.
3. Designer clothes and sunglasses are examples of products that typically utilize an intensive distribution strategy.
1. Products that are typically more likely to have a shorter marketing channel include
a. perishable products.
2. Intensive distribution is utilized for products that
c. consumers purchase on the spot without much shopping around.
3. Distributing a product exclusively to a limited number of organizations under strict terms can help
e. prevent a company’s brand from deteriorating.
1. Consumers are gaining marketing channel power.
2. Channel conflicts are atypical.
3. Contracts typically take care of most channel conflicts.
1. Channel conflicts occur because
b. channel members have their own goals.
2. When Pat’s dairy company has a conflict with Ron’s grocery store, a _____ occurs.
d. vertical conflict
3. An ethical and effective strategy utilized to gain channel member cooperation is
e. educating channel members’ sales representatives about your product.
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