Deck 8: Objective Setting and Budgeting

Question 1

An expectation from the consumer's perspective is based on how the brand has been positioned.

Answer 1

True

Question 2

The initial marcom imperative for new or unestablished brands is to create awareness.

Answer 2

True

Question 3

Marcom objectives should be qualitative and measurable.

Answer 3

False

Question 4

Marcom implementation decisions include the choice of messages,media,mixture of marcom elements,and the achievement of a continuous message presence,or momentum.

Question 5

According to the hierarchy-of-effects model,brand-loyal consumers are the ultimate goal.

Question 6

The top step on the hierarchy of effects ladder is brand awareness.

Question 7

Objective setting and budgeting decisions must be formal and systematic.

Question 8

Objective setting and budgeting decisions are implementation marcom decisions.

Question 9

It is optional that marcom objectives be established prior to making decisions regarding message selection and media determination.

Question 10

One reason why it is essential that objectives be established prior to making implementation decisions is that objectives provide a formalized expression of management consensus.

Question 11

Marcom objectives are goals that the various marcom elements aspire to individually or collectively achieve during a specific period of time.

Question 12

Marcom objectives should be established after making decisions regarding message selection and media determination.

Question 13

The hierarchy-of-effects model implies that for marketing communications to be successful,the various marcom elements must advance consumers through a series of behavioral stages.

Question 14

Marcom objectives should specify the target audience,indicate the specific goal to be accomplished and indicate the relevant time frame.

Question 15

Objectives for a particular element of a marcom program should be determined independently from objectives set for other marcom components.

Question 16

Because individual consumers inevitably will be at different levels of the hierarchy of effects,marcom objectives should be based on the lowest level where any consumers are located.

Question 17

Marcom objectives must specify the amount of change.

Question 18

Objectives provide standards against which results can be measured.

Question 19

Sales promotion is effective for encouraging trial purchases.

Question 20

Of all the marcom tools,sales promotion generally is the most effective and efficient method for quickly creating brand awareness.

Question 21

According to the traditional view,a brand's sales volume during any given period is the consequence of a host of factors in addition to marcom efforts.

Question 22

The encoding variability hypothesis states that people will be more likely to remember information that is relevant to their daily lives.

Question 23

Presales,or communication,objectives such as increases in brand awareness are claimed to be "vaguely wrong," in contrast to sales measures that are asserted to be "precisely right."

Question 24

The competitive parity method sets the budget by examining what competitors are doing.

Question 25

The ratio of a brand's advertising expenditures to total category advertising expenditures is that brand's share of voice (SOV).

Question 26

Increasing advertising expenditures is guaranteed to have a substantial impact on augmenting a brand's sales volume.

Question 27

The antithesis of the traditional view toward advertising objectives (i.e.,the heretical view)is that advertising objectives should be stated in terms of sales or market share.

Question 28

The first step of the objective-and-task method is to establish specific marketing objectives that need to be accomplished,such as sales volume,market share,and profit contribution.

Question 29

The traditional view states that marcom objectives should be stated in terms of sales and market share.

Question 30

When a company that has a relatively low market share has a major competitor with a relatively high share of voice,the recommendation would be to increase advertising expenditures and find a niche that can be defended against other small-share brands.

Question 31

The percentage of sales method is the advertising budgeting procedure used most frequently by both consumer and industrial companies.

Question 32

In terms of profitability,investing in advertising can be justified only if the incremental revenue generated from the advertising effort exceeds the increase in advertising expense.

Question 33

Objective setting and budgeting are _____ marcom decisions.

A) fundamental
B) implementation
C) short-term
D) long-term
E) primary

Question 34

Objective setting and budgeting decisions must be _____.

A) short-term
B) long-term
C) short-term and long-term
D) formal and systematic
E) unplanned

Question 35

The advertising-to-sales response function is the amount of sales revenue generated at each level of advertising expenditure.

Question 36

_____ are goals that the various marcom elements aspire to individually or collectively achieve during a scope of time such as a business quarter or fiscal year.

A) Marketing objectives
B) Communication objectives
C) Sales objectives
D) Marcom objectives
E) Market share objectives

Question 37

The two broad type of marcom objectives are short-term and long-term.

Question 38

Which of the following is an example of a marcom goal from which marcom objectives can be derived?

A) Facilitate the successful introduction of new brands.
B) Create brand awareness.
C) Increase customer loyalty.
D) Generate sales leads.
E) All of these are correct.

Question 39

Which of the following is NOT a marcom implementation decision?

A) budgeting
B) choice of messages
C) media
D) mixture of marcom elements
E) achievement of momentum

Question 40

The highest percentage of sales devoted to advertising is found in the food products industry.

Question 41

A marketer distributes samples of a new product to consumers in the hope that they will form positive _____ about the product's performance,which will then lead to further purchases.

A) feedback
B) interpretations
C) awareness
D) beliefs
E) price perceptions

Question 42

Which marcom tool is best at encouraging trial purchases?

A) advertising
B) personal selling
C) public relations
D) sales promotion
E) point-of-purchase displays

Question 43

Advertisers obtain consumer loyalty by providing a brand that meets the needs of the consumers and _____.

A) by continually advertising the brand's merits
B) by stressing the price
C) by stating the unfavorable attributes of the major competitor
D) by using sales promotion
E) All of these are correct.

Question 44

Which of the following is a requirement for setting marcom objectives?

A) Objectives must include a precise statement of who, what, and when.
B) Objectives must be qualitative.
C) Objectives must be broad in scope.
D) Objectives must be long-term.
E) Objectives must be short-term.

Question 45

Owners of Sun Buns,Incorporated,a new beach-side California baker,want to make sure that consumers are aware of their baked goods,but they also want to persuade consumers that their products are more nutritious than competitive brands.Their ads will be designed to move consumers from the awareness state of the hierarchy-of-effects model to what stage?

A) brand loyalty
B) trial
C) expectation
D) unawareness
E) preference

Question 46

The marcom tools most suitable for accomplishing the objective of informing the trade and consumers about brand improvements are _____.

A) advertising and packaging
B) p-o-p displays and brand naming
C) personal selling and trade-oriented advertising
D) word-of-mouth and event sponsorship
E) cause-oriented marketing and public relations

Question 47

Which is the top rung on the hierarchy of marcom effects?

A) awareness
B) beliefs
C) attitudes
D) expectations
E) brand loyalty

Question 48

Which of the following is a step in the hierarchy-of-effects model?

A) unawareness
B) expectations
C) trial
D) beliefs
E) All of these are correct.

Question 49

Good objectives set precise,quantitative yardsticks of what a marcom program hopes to accomplish,or _____.

A) achieve management consensus
B) guide subsequent marcom decisions
C) provide standards
D) outline specific strategies
E) set budgeting method

Question 50

One reason why it is essential that objectives be established prior to making marcom implementation decisions is that objectives provide _____ against which results can be measured.

A) management consensus
B) guidelines
C) standards
D) effects
E) a hierarchy

Question 51

The objective for a brand's marcom program at any point in time depends on _____.

A) how many consumers are in the market
B) how long the marketer has been offering the brand
C) where on the hierarchy most consumers are located
D) the lowest level on the hierarchy where consumers are located
E) the highest level on the hierarchy where consumers are located

Question 52

Why is the ultimate objective to achieve brand loyal consumers?

A) It is much cheaper to retain present customers than it is to continuously prospect for new ones.
B) Competitors will go out of business once consumers are loyal to your brand.
C) Switching costs are too high for consumers once they become brand loyal.
D) Brand loyal consumers are a "captive audience," which reduces marcom expenditures in the future.
E) Brand loyal consumers are more satisfied consumers.

Question 53

Attitudes would most likely precede behavior when purchasing _____.

A) pens
B) cleaning products
C) new automobiles
D) soft drinks
E) aspirin

Question 54

Which of the following is a reason why it is essential that objectives be established prior to making implementation decisions regarding message selection,media determination,and how the various marcom elements should be mixed and maintained?

A) Objectives provide standards against which results can be measured.
B) Objective setting guides the budgeting, message, and media aspects of a brand's marcom strategy.
C) Objectives provide a formalized expression of management consensus.
D) a and b only
E) a, b, and c

Question 55

Which of the following is NOT a step in the hierarchy-of-effects model?

A) brand loyalty
B) satisfaction
C) trial
D) unawareness
E) attitude

Question 56

The hierarchy-of-effects metaphor implies that for marketing communications to be successful,the various marcom elements must _____.

A) encourage consumers to discuss the advertisement
B) create brand loyalty for the product
C) advance consumers through a series of psychological stages
D) have the objective of creating brand awareness
E) encourage consumers to purchase the product

Question 57

Once brand-specific beliefs and attitudes are formed as the outcome from firsthand product usage experience,subsequent marketing communications _____.

A) are not necessary
B) should increase in intensity
C) should decrease in intensity
D) serve to guarantee brand loyalty
E) serve to reinforce the consumers' beliefs and attitudes

Question 58

According to the hierarchy-of-effects model,the advertiser's initial imperative is to _____.

A) make people aware of the brand
B) make people like the advertisement
C) make people discuss the advertisement with others
D) encourage trial of the product
E) change beliefs of the brand

Question 59

Linda saw a print ad in a magazine for Clairol's Natural Essence semi-permanent hair color that she knew existed but did not know anything about it.The ad informed her that users of this hair dye will not see gray roots.In terms of the hierarchy-of-effects model,which step does this marketing communication represent?

A) creating awareness
B) creating an expectation
C) encouraging trial purchase
D) reinforcing attitudes
E) accomplishing brand loyalty

Question 60

The process of setting objectives literally forces top marketing executives and marcom personnel to agree on the course that a brand's marcom strategy will take for the following planning period as well as the tasks it is to accomplish for a specific brand,thus providing a formalized expression of _____.

A) guidelines
B) standards
C) hierarchy of effects
D) competitive advantage
E) management consensus

Question 61

One reason that sales response is claimed to represent an unsuitable marcom objective is that advertising during any given period does not necessarily influence sales in the current period but may influence sales during later periods.This is referred to as the _____ effect.

A) economic
B) consumer response
C) heretical
D) advertising response
E) lagged

Question 62

The owners of Sun Buns,a new beach-side baker in California,set the following advertising objective: "Increase awareness of the Sun Buns brand from 45 to 55 percent." Which of the following best characterizes this objective?

A) not quantitative
B) unrealistic
C) imprecise
D) specific in terms of the amount of change
E) qualitative

Question 63

When MC > MR there is a _____.

A) marginal gain
B) sub-optimization of profits
C) need for increased advertising
D) marginal loss
E) maximization of profits

Question 64

Although there is no simple resolution to whether the traditional or heretical view is more correct,one thing is certain: companies and their chief executives and financial officers are increasingly demanding greater _____ from marcom programs.

A) creativity
B) product placement
C) consumer response
D) brand awareness
E) accountability

Question 65

Which point of view asserts that it is unsuitable to use sales as the objective for a branded product's marcom effort?

A) traditional view
B) common view
C) communications view
D) heretical view
E) revolutionary view

Question 66

Which of the following is NOT a requirement for setting marcom objectives?

A) Objectives must specify the amount of change.
B) Objectives must be stated in terms of profits.
C) Objectives must be realistic.
D) Objectives must be internally consistent.
E) Objectives must be clear and in writing.

Question 67

Presales objectives are commonly referred to as _____.

A) marcom standards
B) communication objectives
C) benchmarks
D) short-term goals
E) focused strategies

Question 68

The owner of a new pizzeria set the following marcom objective: "Make consumers aware of this new restaurant." This objective suffers from _____.

A) being unrealistic
B) not being quantitative and measurable
C) not being internally focused
D) being externally focused
E) being too specific

Question 69

The assessment of marcom effectiveness should include,but not be restricted to,_____.

A) presales goals
B) percentage-of-sales
C) qualitative measurement
D) survey data
E) economic analysis

Question 70

In terms of profitability,investing in advertising can be justified only if the incremental revenue generated from the advertising effort exceeds the increase in the _____.

A) production expense
B) operational expense
C) discretionary expense
D) advertising expense
E) committed expense

Question 71

The traditional view states that advertising objectives should not be stated in terms of _____.

A) sales or market share gains
B) brand awareness
C) attitude change
D) purchase intentions
E) creating brand loyalty

Question 72

According to the heretical view,presales,or communication,objectives such as increase in brand awareness are claimed to be _____.

A) precisely right
B) precisely wrong
C) vaguely right
D) vaguely wrong
E) just plain wrong

Question 73

Which of the following can impact the sale-to-advertising response function?

A) creativity of advertising execution
B) state of the economy
C) intensity of competitive advertising efforts
D) overall quality of the brand's mix
E) All of these are correct.

Question 74

Harriet is a marcom manager who asserts that using sales as the objective for a branded product's marcom effort is unsuitable because she feels that sales are a function of other factors in addition to marcom efforts.Harriet is espousing which view?

A) traditional view
B) common view
C) heretical view
D) revolutionary view
E) middle-of-the-road view

Question 75

John is the marcom manager at a major consumer packaged goods manufacturer.He feels that marcom objectives should be stated in terms of sales or market share gains and that failure to do so is a cop-out.Which view is John espousing?

A) traditional view
B) common view
C) heretical view
D) revolutionary view
E) controversial view

Question 76

A manufacturer of consumer goods has stated the advertising and sales promotion objective is to increase retail distribution by 25 percent while at the same time has reduced the sales force size by 20 percent.This objective suffers from _____.

A) not being quantitative and measurable
B) not being internally consistent
C) being too specific
D) expecting too small of a change
E) not being clear

Question 77

A certain brand of hand lotion commands 7 percent of the market for this product category.To increase the brand's market share,a new advertising campaign is formulated with the following objective: "Within the next six months,our objective is to increase the brand's market share from 7 percent to 40 percent." This objective suffers from being ____.

A) imprecise
B) nonmeasurable
C) general
D) unrealistic
E) qualitative

Question 78

Which of the following is an argument against using sales as the objective for a branded product's marcom effort?

A) A brand's sales volume during any given period is the consequence of a host of factors in addition to marcom efforts.
B) Marcom's effect on sales is typically delayed.
C) Marcom agency compensation formulas are based on media commissions, not a brand's sales.
D) a and b only
E) a, b, and c

Question 79

The _____ function refers to the relationship between money invested in advertising and the response,or output,of that investment in terms of revenue generated.

A) sales response
B) advertising response
C) sales-to-advertising response
D) advertising-to-sales response
E) marcom response

Question 80

The heretical view states that advertising objectives should always be stated in terms of _____.

A) awareness levels
B) attitude change
C) purchase intention
D) sales or market share gains
E) creating brand loyalty