Exam 21: Ethical Marketing in a Consumer-Oriented World: Appraisal and Challenges

Use this information to answer the following questions that refer to the EI (Electech Inc.) case. Electech, Inc. (EI) produces a line of semiconductors for electronics products manufacturers. These items range in price from $5-$100 and are used in products the buyer is producing. EI also designs and builds computer networking equipment. The prices of these items range form $5,000 to $100,000. These are used to control production equipment. Usually, they are custom-made to the specifications of the buyer--the firm which will use the product in its own production process. EI sells nationally through independent sales reps--paid on commission--who work in the large industrial centers across the country. EI is more concerned with the quality of these reps than with the number of them. All of them also sell other lines. EI also uses five full-time salaried salespeople who work out of its corporate headquarters under a sales manager. The home office salespeople are "technical specialists" who sell almost all the networking equipment, while the "reps" mostly sell the semiconductors. Sometimes, however, the reps will send in leads to customers who want networking equipment. EI also sells some of its semiconductors through a Los Angeles wholesaler who carries stock for West Coast customers. There are many producers and importers of semiconductors in the U.S.--but several firms have captured large shares of the networking equipment market. EI has held its own, and in fact, over the past five years has increased its market share of these products to over 25 percent--because of its better technical designs. Industry-wide prices of the more or less homogeneous semiconductors have been forced further and further down over the last seven years--as have industry profits. The price of networking equipment is set by adding a standard markup percent to the direct cost of the items--for overhead and for profit. Following industry practice, all prices are quoted at the seller's factory. EI publishes a catalog which is revised periodically. And it exhibits in most equipment trade shows. -In the EI case, which stage of the product life cycle do semiconductors appear to be?

According to the text:

Consumer satisfaction at the micro level cannot be measured because firms cannot determine how well their products satisfy customers.

Monopolistic competition is the result of control of markets by business, not consumer demands.

People have always been materialistic, even in the most primitive societies.

The best way to improve the operation of our MACRO-marketing system--given the current objectives of our society--is:

The legal environment sets the maximum standards of ethical behavior in a society.

Use the following information to answer questions that refer to the Jewel Craft case. Jewel Craft, Inc. is a leading producer in the United States women's costume jewelry and accessories market. Its brands are well known and are sold by department stores and better women's stores. Several stores in a city may carry Jewel Craft's brands because most of Jewel Craft's customers will not consider any other brand. Jewel Craft's sales force calls on one wholesaler in each state. Gemco, Inc., of Boston, Massachusetts, is the Jewel Craft distributor in that state. Gemco stocks and sells women's accessories (noncompeting lines) for several manufacturers like Jewel Craft. Wholesalers are allowed a 20 percent markup by Jewel Craft--but pay the freight charges to their warehouses. Jewel Craft's policy of using one wholesaler per state comes from its desire to control its distribution. Jewel Craft uses national magazine advertising and also supports a cooperative ad program with retailers. Jewel Craft's prices allow for a 40 percent retail markup--an attractive percent when one considers that Jewel Craft's products require little in-store selling because of their well-established reputation. Recently, Jewel Craft was approached by a watch producer with the idea of expanding to watches under the Jewel Craft name. It was argued that although national watch sales have leveled off, Jewel Craft could enjoy growing sales for several years because of the fine reputation the company has achieved. If watches are added, Jewel Craft will use its present policies regarding distribution, pricing, and advertising. Further, it will offer the wholesalers and retailers an attractive "package" deal as an incentive to carry Jewel Craft watches. Intermediaries will be required to carry the watches if they wish to handle the jewelry and accessories. -Given the information in the Jewel Craft case, jewelry and accessories would be in which product class?

Use this information to answer the following questions that refer to the EI (Electech Inc.) case. Electech, Inc. (EI) produces a line of semiconductors for electronics products manufacturers. These items range in price from $5-$100 and are used in products the buyer is producing. EI also designs and builds computer networking equipment. The prices of these items range form $5,000 to $100,000. These are used to control production equipment. Usually, they are custom-made to the specifications of the buyer--the firm which will use the product in its own production process. EI sells nationally through independent sales reps--paid on commission--who work in the large industrial centers across the country. EI is more concerned with the quality of these reps than with the number of them. All of them also sell other lines. EI also uses five full-time salaried salespeople who work out of its corporate headquarters under a sales manager. The home office salespeople are "technical specialists" who sell almost all the networking equipment, while the "reps" mostly sell the semiconductors. Sometimes, however, the reps will send in leads to customers who want networking equipment. EI also sells some of its semiconductors through a Los Angeles wholesaler who carries stock for West Coast customers. There are many producers and importers of semiconductors in the U.S.--but several firms have captured large shares of the networking equipment market. EI has held its own, and in fact, over the past five years has increased its market share of these products to over 25 percent--because of its better technical designs. Industry-wide prices of the more or less homogeneous semiconductors have been forced further and further down over the last seven years--as have industry profits. The price of networking equipment is set by adding a standard markup percent to the direct cost of the items--for overhead and for profit. Following industry practice, all prices are quoted at the seller's factory. EI publishes a catalog which is revised periodically. And it exhibits in most equipment trade shows. -In the EI case, what is the nature of competition for networking equipment?

According to your text, critics of advertising

There are many reasons for business failures including products that do not create value in the eyes of the customer, improperly identifying the target market, or lack of innovative thinking.

At the macro level, consumer satisfaction can easily and objectively be measured using practical economic methods.

The basic objective of the U.S. market-directed economic system is to:

The text argues that the plight of the homeless is a result of the forces of market competition in our market-directed economies.

The authors of the text contend that:

Suppose you were able to start new cities on a planet in outer space. Suppose also that these cities will be self-supporting. Further, they will be democratic--with the objective of maximizing consumer welfare--measured by the level of consumer satisfaction. The economic decisions will be made through the "market mechanism." Which of the following statements might be made by some of the settlers?

Use this information to answer the following questions that refer to the EI (Electech Inc.) case. Electech, Inc. (EI) produces a line of semiconductors for electronics products manufacturers. These items range in price from $5-$100 and are used in products the buyer is producing. EI also designs and builds computer networking equipment. The prices of these items range form $5,000 to $100,000. These are used to control production equipment. Usually, they are custom-made to the specifications of the buyer--the firm which will use the product in its own production process. EI sells nationally through independent sales reps--paid on commission--who work in the large industrial centers across the country. EI is more concerned with the quality of these reps than with the number of them. All of them also sell other lines. EI also uses five full-time salaried salespeople who work out of its corporate headquarters under a sales manager. The home office salespeople are "technical specialists" who sell almost all the networking equipment, while the "reps" mostly sell the semiconductors. Sometimes, however, the reps will send in leads to customers who want networking equipment. EI also sells some of its semiconductors through a Los Angeles wholesaler who carries stock for West Coast customers. There are many producers and importers of semiconductors in the U.S.--but several firms have captured large shares of the networking equipment market. EI has held its own, and in fact, over the past five years has increased its market share of these products to over 25 percent--because of its better technical designs. Industry-wide prices of the more or less homogeneous semiconductors have been forced further and further down over the last seven years--as have industry profits. The price of networking equipment is set by adding a standard markup percent to the direct cost of the items--for overhead and for profit. Following industry practice, all prices are quoted at the seller's factory. EI publishes a catalog which is revised periodically. And it exhibits in most equipment trade shows. -What kind of products are EI's semiconductors FOR MOST CUSTOMERS?

Which of the following is NOT a trend affecting marketing strategy planning in the area of International Marketing?

Which section of a formal marketing plan for a new product is most directly related to deciding how you want the target market to think about your product compared to competitive products?

Which of the following does NOT support the idea that "MICRO-marketing often DOES cost too much"?