TRUE FALSE QUESTIONS ASSESSMENT 2

TRUE FALSE QUESTIONS ASSESSMENT 2 - ASSESSMENT 2 TRUE/FALSE...

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Unformatted text preview: ASSESSMENT 2 TRUE/FALSE PREPARATION GUIDE REVIEW SESSION SUNDAY MARCH 13 EA 202, AflO—«SflOPM VOLUNTARY ATSENDANCE F 10. ll. 12. l3. 14. 15. l6. l7. l8. . Most economists assume that consumers are "economic buyers" who logically evaluate choices in terms of cost and value received to get the greatest satisfaction from spending their time and money. The economic—buyer theory assumes that consumers know all the facts and logically compare choices in terms of cost and value. According to our class discussions, consumer buying decisions are influenced by psychological variables, social influences, and the purchase situation. Motivation, perception, learning, attitudes and lifestyle are psychological variables which affect consumer buying. Family, social class, reference groups, opinion leaders, and culture are the intrapersonal variables that affect a consumer's buying decisions. Wants are needs which are learned during a person's life. The "hierarchy of needs" model suggests that we never reach a complete state of satisfaction, and that as lower level needs are satisfied higher level needs become more dominant. Consumers do not usually see or hear all the stimuli that come their way. "Selective exposure" refers to a person's ability to screen out or modify ideas, messages, and information that conflict with previously learned attitudes and beliefs. Reinforcement of a response decreases the likelihood of the same response the next time the drive occurs. Adding lemon scent to Pledge furniture polish is an example of using a positive cue. A perfume ad that suggests that people who use the product have more appeal to the opposite sex is an example of a positive cue. Many needs are culturally (or socially) learned. A consumer's belief about a product may have a positive or negative effect on his or her attitudes about the product. It is easier for a marketer to work with existing attitudes than to try to change them. Consumers may evaluate a product not just on how well it performs but on how it performs relative to their expectations. In light of the relationships between consumer expectations and satisfaction, it's usually best for promotion to slightly "over promise" what the firm can actually deliver. Activities, Interests and Opinions are the "A10" variables used in lifestyle analysis. Page &P F 19. 20. 2]. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. Buying responsibility and purchase influence between husband and wife vary greatly--depending on the product and the specific family. According to class discussion, the US. social class system is usually measured in terms of occupation, education, and housing arrangements. The upper-middle class typically includes small businesspeople, office workers, teachers, technicians, and most "white-collar" workers. People who have the same amount of income--but who are in different social classes-—tend to spend their income in the same way. Given the same income as middle-class consumers, lower-class consumers will handle themselves and their money very differently. The group of people to whom an individual looks when forming attitudes about a particular topic is his reference group for that topic. A person normally has several reference groups. Reference group influence is likely to be greater for products which will not be seen by other individuals. Reference groups are more important when others will be able to "see" which product or brand we're using. Opinion leaders for one subject or product are also usually opinion leaders for many other subjects or products. Word-of—mouth publicity from opinion leaders can be favorable or unfavorable. Marketers who want to aim at people within several different cultures usually will be able to use the same marketing mix for all of them. Needs, benefits sought, attitudes, motivation, and even how a consumer selects certain products all vary depending on the purchasing situation. Different purchase situations may require different marketing mixes, even though the same target market is involved. A consumer interested in making a low involvement purchase is most likely to use "limited problem solving"—-rather than one of the other levels of problem solving. Finding her favorite brand of shampoo temporarily out of stock, a supermarket shopper is more likely to take part in routinized response behavior than limited problem solving. Dissonance takes place when an individual is NOT confident about the rightness of a decision. Page &P F 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. It's hazardous to rely on intuition in generalizing about cultural influences on consumer behavior from one country to another. Like final consumers, organizations make purchases to satisfy specific needs, but their basic need is for goods and services that will help them satisfy their own customers or clients. Organizational buyers often buy on the basis of a set of purchasing specifications. Purchasing specifications may be very simple (with only a brand name or part number) or very detailed (as with services). Purchasing managers are buying specialists for organizations and may have a lot of power. The process of organizational buying is entirely different from consumer buying. Straight-rebuy buying takes longer than modified-rebuy or new—task buying and offers more chance for promotion impact by the seller. In business markets, suppliers usually want close relationships with customers; however, there's little benefit to the customer of having closer relationships with suppliers. In cooperative relationships in a business market, the buyer and seller work together to jointly achieve both mutual and individual objectives. Negotiated contract buying would be used when the buyer knows precisely What he wants and the requirements of the job aren't likely to change as the job is done. Relationship-specific adaptations involve changes in a firm's product or procedures that are unique to the needs or capabilities of a relationship partner. To protect themselves from unpredictable events, most purchasing managers seek several dependable sources of supply. The Internet is making even straight rebuys more competitive. Most retail and wholesale buyers see themselves as purchasing agents for their target customers. Most wholesalers and retailers pay very close attention to each item they handle, treating most products as new-task purchases. A "Product" Should be thought of as potential customer satisfactions or benefits. A "Product" might involve a physical good, a service, or a combination of the two. A service is not a "Product" because services do not include any physical good. Goods are intangible and services are tangible. Page &P 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. There are two broad groups of product classes based on the type of customer that will use the product. According to the text, the consumer product classes are based on why consumers use products. Products which a consumer needs but isn't willing to spend much time shopping for are convenience products. Convenience products include staples, impulse products, and emergency products. Consumer products which are bought often, routinely, and without much thought are staples. Staples are consumer products which are sold in places like gourmet shops and health food stores, because convenience is not important to the customer. Consumer products which a customer buys on sight as unplanned purchases, may have bought the same way before, and wants "right now" are impulse products. Emergency products are purchased only when the need is great and urgent, and therefore price is usually not very important. Consumer products that a customer feels are worth the time and effort to compare with competing products are shopping products. Shopping products that a customer sees as basically the same and wants at the lowest price are homogeneous shopping products. Shopping products that a customer sees as basically the same and wants at the lowest price are heterogeneous shopping products. Shopping products that a customer sees as different and wants to inspect for quality and suitability are heterogeneous shopping products. Consumer products that a customer really wants and is willing to make a special effort to shop for and compare different possibilities are specialty products. For different people, the same product might be a convenience product, a shopping product, or a specialty product. The demand for business products derives from the demand for final consumer products. Although the total industry demand for business products may be inelastic, the demand facing individual sellers may be extremely elastic. Expense items are depreciated over many years, while capital items are charged off as they are used-—usually in the year of purchase. Page &P 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. Business product classes are based on the way that buyers shop for and buy products, because there is much more shopping for business products compared to consumer products. Business product classes are based on how buyers see products and how the products are to be used. Installations are long-lasting capital items such as buildings and land rights, custom-made equipment, and standard equipment. Capital items which are more expensive and longer—lived than installations are called accessory equipment. Raw materials are unprocessed expense items such as farm products and natural products. Supplies (business products) are expense items that do not become part of a final product. For professional services which are needed only occasionally and require special skills, it is usually better for a firm to have its own employees provide them than to use outsiders. "Branding" includes the use of trademarks and brand names to identify a product. Branding is more likely to be successful if the product is the best value for the price, and quality can be consistently maintained. Branding would be more likely to be successful if dependable and widespread availability of a product is possible. Brand familiarity means how well customers recognize and accept a company's brand. Brand preference means customers usually choose the brand over other brands, perhaps out of habit or past experience. Brand insistence means that customers usually choose one brand over other brands, perhaps out of habit or past experience. Brand names that convey a positive image in one language may be meaningless in another. A marketing manager should make sure the firm's brand names do not become so familiar that they become common descriptive terms for certain kinds of products. Family brands may cut promotion costs because the goodwill attached to one or two products may help the others. It is usually necessary for a firm to use a family brand rather than individual brands if it plans to offer products at different quality and price levels to different target markets. A product which has no brand other than the identification of the contents is a generic product. Page &P F 99. F 100. F101. F 102. F103. F104. F105. F 106. F 107. F108. . Dealer brands are brands created by producers. . Manufacturer brands are always advertised and distributed more widely than dealer brands. . The "battle of the brands" is the competition between dealer brands and manufacturer brands. . Because packaged products are regularly seen in retail stores, a good package may give a firm more promotion effect than it could possibly afford with advertising. . The universal product code has been opposed by large supermarket chains because it slows down the checkout process. . It is illegal for a firm to use a package that cannot be recycled. . Unit—pricing means placing the price per ounce, or some other standard measure, on or near the product. . A warranty explains what the seller promises about its product. . The product life cycle concept is concerned with planning for product recycling to protect the environment. The product life cycle is the four stages a new product idea goes through from beginning to end. Market introduction, market growth, market maturity, and sales decline are the four stages of the product life cycle. During the various stages of the product life cycle, the attitudes and needs of target customers do not change. Sales and profits generally decrease continually throughout the product life cycle. The market introduction stage of the product life cycle is usually marked by losses, as money is being invested in the hope of future profits. In the market growth stage of the product life cycle, firms usually earn smaller profits than they did in the market introduction stage because new competitors enter the market. During the market growth stage of the product life cycle, industry profits usually reach their peak and begin to decline. Industry profits usually decline steadily during the market maturity stage of the product life cycle. The market maturity stage of the product life cycle rarely lasts more than one or two months. During the sales decline stage of the product life cycle, no firm can earn a profit. Page &P F 109. F110. F111. F112. F113. F114. F115. F116. F117. F118. F119. F 120. F121. F 122. F123. F 124. F125. F 126. F127. Product life cycles describe industry sales and profits within a particular product-market, and not the sales and profits of individual products or brands. The product life cycle shows that sales of an individual firm's product follows a general pattern—- which is very useful for marketing strategy planning. The sales and profits of an individual brand may or may not follow the life cycle pattern of the product idea. A product idea may be in different life-cycle stages in different markets. A firm may introduce or withdraw a product during any stage of the product life cycle. It's possible for a firm with a mature product in the US. to experience new growth with the same product in international markets. To fully understand the nature of competition and the speed of the relevant product life cycle, it is important not to define a market too narrowly. The length of each stage in the product life cycle is set. The smaller the comparative advantage of a new product over those already on the market, the faster its sales will grow. Sales growth is faster when a new product is easy to use and its advantages are easy to communicate. Sales grth is faster when the product can be used on atrial basis. Sales growth is usually faster when the product is incompatible with the past values and experience of the target market. In general, product life cycles appear to be getting longer in recent years. Having a patent on a new product provides very strong protection in slowing down competitors. Firms should try to develop marketing mixes that make the most of the market growth stage of the product life cycle--when profits are highest. The stage of the product life cycle in which competitors are most likely to introduce product improvements is the market growth stage. A fad cycle is shorter than a fashion cycle. The probable length of the product life cycle has little effect on strategy planning. Marketing strategy planning for a product depends on where the product is in its life cycle and how fast it is moving to the next stage. Page &P T F 128. When introducing a really new product, the marketer should be concerned about building channels of distribution, but not about promotion. T F 129. A new—product development process helps make sure that new ideas for products are carefully studied and good ideas are marketed profitably. T F 130. If an individual is injured by a defective or unsafely designed product, the seller's legal obligation to pay damages is called product liability. Page &P TRUE/FALES ANSWER GUIDE: ASSESSMENT 2, SPRING SEMESTER 2011 1 T 34 F 67 F 100 T 2 T 35 T 68 T 101 F 3 T 36 T 69 T 102 F 4 T 37 T 70 T 103 T 5 F 38 T 71 F 104 F 6 T 39 T 72 F 105 T 7 T 40 T 73 T 106 T 8 T 41 F 74 T 107 F 9 F 42 F 75 F 108 F 10 F 43 F 76 T 109 T 11 T 44 T 77 T 110 F 12 T 45 F 78 F 111 T 13 T 46 T 79 T 112 T 14 T 47 T 80 T 113 T 15 T 48 T 81 T 114 T 16 T 49 T 82 T 115 T 17 F 50 F 83 T 116 F 18 T 51 T 84 F 117 F 19 T 52 T 85 T 118 T 20 T 53 F 86 T 119 T 21 F 54 F 87 T 120 F 22 F 55 T 88 F 121 F 23 T 56 F 89 T 122 F 24 T 57 T 90 F 123 T 25 T 58 T 91 F 124 T 26 F 59 T 92 T 125 T 27 T 60 F 93 T 126 F 28 F 61 T 94 F 127 T 29 T 62 T 95 F 128 F 30 F 63 T 96 T 129 T 31 T 64 T 97 T 130 T 32 T 65 F 98 F 33F 66T 99T ...
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