Deck 14: Sales Promotion

Question 1

Payments offered by manufacturers to retailers for performing certain promotional or merchandising activities in support of their brands are called:

A) cooperative advertising
B) push monies
C) advertising subsidies
D) promotional allowances

Answer 1

promotional allowances

Question 2

Ralston Purina offers its retail accounts a $3.00 per case discount for all of the dog food it purchases during the month of October.This discount will be deducted straight from the bill.This is an example of:
A. push money.
B. a slotting allowance.
C. an off-invoice allowance.
D. a coop allowance.

Question 3

_____ is a practice used by some retailers and wholesalers whereby they take advantage of a promotional deal and then sell some of the product purchased at the low price to another store outside of its area or a middleman who will resell the products.
A. Forward buying
B. Diverting
C. Everyday low pricing
D. Discount trading

Question 4

Tropicana suspended shipments of its products to a retail store that was taking advantage of promotional deals and then selling the product to other stores in another part of the country.The retailer was engaged in:
A. forward buying
B. diverting
C. slotting
D. transference charging

Question 5

Which of the following is NOT an example of a point-of-purchase display?
A. Wall display
B. TV display
C. Mall poster
D. End-of-aisle display

Question 6

All of the following are reasonable objectives for trade-oriented sales promotions EXCEPT:
A. to obtain distribution and support for new products.
B. to maintain trade support for established brands.
C. to encourage the trade to display and support established brands.
D. to differentiate a brand through image enhancement.

Question 7

Another term used for push money that is given to retailers' or wholesalers' sales staff to encourage them to promote and sell a company's product is:
A. pull money
B. a rebate
C. a spiff
D. an off-invoice allowance

Question 8

Monies that must be paid to a retailer so they will take on a company's new product are known as:
A. slotting allowances
B. trade discounts
C. spiffs
D. new product fees

Question 9

Which of the following statements describes a major concern marketers have with trade allowances?
A. Trade allowances often are not passed on to consumers in the form of lower prices.
B. Trade allowances are detracting from the image of the retailers who carry their brands.
C. Consumers pocket most of the savings from trade promotion discounts.
D. Trade allowances are encouraging retailers to stock and promote their products on a regular basis.

Question 10

A(n)_______ is an important promotional tool because it can help an advertiser obtain more in-store merchandising of products.
A. off-invoice allowance
B. point-of-purchase display
C. trade allowance
D. in-pack coupon

Question 11

All the following are advantages associated with the use of trade allowances EXCEPT:
A. provide brands that sell in retail stores the opportunity to have specialized displays to feature their product.
B. strengthen the brand image.
C. permit a brand to obtain prominent place where high traffic occurs.
D. ensure greater in-store exposure.

Question 12

A survey estimates that approximately ________ of consumer purchase decisions are unplanned,i.e.made in the store.
A. 6%
B. 15%
C. 24%
D. 55%

Question 13

Programs involving cash payments directly to the sales force to reward them for selling the manufacturer's products involve the use of:
A. slotting fees
B. pull monies
C. spiffs
D. promotional allowances

Question 14

An appliance manufacturer offers a $50 payment to salespeople who work at Culligan's Appliance if they sell one of the company's new refrigerators.This payment is known as:
A. a slotting fee.
B. a trade allowance.
C. push money.
D. pull money.

Question 15

_____ is a practice used by retailers whereby they stock-up on a product at a low deal or off-invoice price and resell it to consumers at higher prices when a promotional period has ended.
A. Forward buying
B. Diverting
C. Promotional discounting
D. Discount trading

Question 16

Which of the following promotions is targeted toward the trade rather than consumers?
A. Spiffs
B. Coupons
C. Premiums and sweepstakes
D. Bonus packs

Question 17

Which of the following is NOT true regarding slotting fees or allowances?
A. Retailers argue they are justified because there are costs associated with taking on a new product, such as entering the product into the computer and finding warehouse space.
B. Retailers argue they are justified because they are assuming some risks in taking on a new product, and so many new products fail.
C. Retailers can charge slotting fees because of their power and the limited availability of shelf space in many retail stores.
D. Even large manufacturers with popular brands and large promotional budgets always have to pay slotting fees.

Question 18

A discount or deal that is offered to a retailer or wholesaler to encourage them to stock,promote,or display a manufacturer's product is known as:
A. push money
B. merchandising support
C. a trade allowance
D. a spiff

Question 19

Crashed Ice is an event featuring a new sport,downhill ice-cross,which was established by:
A. Smirnoff Vodka.
B. Red Bull Energy Drink.
C. Orange Crush.
D.

Question 20

Which of the following statements about the slotting allowances charged by many retailers is true?
A. Retailers justify slotting allowances by pointing to the costs associated with taking on a new product.
B. Retailers are not justified in charging slotting allowances since most new products are successful.
C. Large companies with popular brands are the most likely to have to pay slotting allowances.
D. Slotting allowances are illegal and banned by the federal government.

Question 21

The "Intel Inside" logo which appears on many computers is an example of:
A. vertical cooperative advertising
B. ingredient-sponsored cooperative advertising
C. horizontal cooperative advertising
D. a rebate cooperative advertising

Question 22

______ is defined as a direct inducement that offers an extra value or incentive for the product to the sales force distributors or to ultimate consumer with the primary objective of creating an immediate sale.

A) Brand advertising
B) Sales promotion
C) Direct marketing
D) Promotional allowance

Question 23

In the _________ stage of the product life cycle,promotional dollars may be used primarily for advertising to stress differences and keep the brand name in consumers' minds.
A. introduction stage
B. growth stage
C. maturity stage
D. decline stage

Question 24

All of the following are examples of trade-oriented sales promotion activities EXCEPT:

A) dealer contests
B) trade allowances
C) point-of-purchase displays
D) coupons

Question 25

How has the view of sales promotions changed during the past decades?

A) Sales promotions are now considered an essential part of an organization's branding strategies.
B) Sales promotion tactics are now developed before the strategy is determined.
C) Sales promotions are now believed to be an ineffective tool for creating brand image.
D) There is no difference between how marketers used to treat sales promotions and how they treat them now.

Question 26

When New Balance sponsors a campaign advertising the availability of its running shoes at Foot Locker stores,this is an example of _____ advertising.
A. horizontal cooperative
B. vertical cooperative
C. dyadic
D. aggregated

Question 27

_____ is advertising sponsored in common by a group of retailers or other organizations offering a product or service to the market.
A. Horizontal cooperative advertising
B. Vertical cooperative advertising
C. Indirect advertising
D. Dyadic communication

Question 28

Advertising implemented by retailers and paid for by a manufacturer is called:
A. joint sales promotions
B. horizontal cooperative advertising
C. vertical cooperative advertising
D. joint trade promotions

Question 29

_____ is an exhibition or forum where manufacturers can display their products to current and prospective buyers.
A. An end-of-aisle display
B. A trade layout
C. A trade show
D. Event marketing

Question 30

Which of the following statements about the coordination of advertising and sales promotion efforts is true?
A. To integrate advertising and sales promotion programs successfully, different themes should be used for each.
B. Consumers are less likely to redeem a coupon or respond to a price-off deal for a brand they are familiar with than one they know nothing about.
C. Product trial created through sales promotion techniques such as sampling or couponing is more likely to result in long-term use of the brand when accompanied by advertising.
D. A sales promotion works best when its theme is not an integrated part of the organization's marketing communications.

Question 31

Why are organizations like McDonald's,Wendy's,and Labatt placing more emphasis on sales promotions than ever before?

A) Because they want to use sales promotions rather than engage in price wars
B) Because sales promotions can be used to provide extra incentives for purchasing a brand
C) Because the use of sales promotions allows them to cut back and/or completely eliminate their use of coupons
D) Because consumers have less time to shop

Question 32

In the ________ stage of the product life cycle,a large amount of the promotion budget may be allocated to sales promotion techniques such as sampling and couponing to induce trial.
A. introduction
B. decline
C. maturity
D. growth

Question 33

Consumer-oriented sales promotions are part of a promotional ______ strategy.

A) premium
B) pull
C) trade
D) push

Question 34

When a brand moves to the _________ stage of the product life cycle,advertising is primarily a reminder to keep consumers aware of the brand.Consumer sales promotions such as coupons,price-offs,premiums,and bonus packs may be needed periodically to maintain consumer loyalty,attract new users,and protect against competition.
A. growth stage
B. maturity stage
C. decline stage
D. early decline stage
c14 Key

Question 35

Which of the following statements does NOT describe an aspect or characteristic of sales promotion?

A) One reason for the decrease in sales promotion is the power shift from manufacturers to retailers.
B) A sales promotion is an acceleration tool designed to speed up the selling process.
C) Sales promotion can be targeted to different parties in the marketing channel.
D) Sales promotions now account for more of marketer's promotional budget than media advertising.

Question 36

When a marketer distributes coupons for a brand with a specific expiration date,they are attempting to use sales promotion as a(n):

A) promotional marketing tool
B) brand equity building promotion
C) acceleration tool
D) value added tool

Question 37

Coupons,bonus packs,premiums,and samples are promotional offers that are targeted toward:

A) consumers
B) retailers
C) wholesalers
D) salespeople

Question 38

Nordica provides sales personnel in ski shops with training classes,detailed manuals,and other tools to help them better understand how to sell the company's ski boots.This is an example of:
A. cooperative advertising
B. slotting fee
C. sales training programs
D. spiffs

Question 39

Five Paradise Island,Bahamas Resort Hotels combining efforts to sponsor an "It's better in the Bahamas" ad campaign,is an example of:
A. horizontal cooperative advertising
B. vertical cooperative advertising
C. integrated dyadic communications
D. a joint trade promotion

Question 40

_____ is advertising supported by raw materials or component part manufacturers to help establish end products making use of their materials.
A. Vertical cooperative advertising
B. Ingredient-sponsored cooperative advertising
C. Horizontal cooperative advertising
D. Support advertising

Question 41

The building or reinforcement of consumer-franchise or equity for a brand:

A) can really only be accomplished through advertising
B) can be done with carefully planned sales promotion programs
C) can be done more easily through trade-oriented promotions than through consumer-oriented promotions
D) is really not very important given the prolonged economic prosperity that Canadians have enjoyed

Question 42

Consumers have become more sensitive and responsive to sales promotion for each of the following reasons EXCEPT:

A) consumers tend to be loyal to their favourite brands.
B) consumers purchase more on the basis of price, value, and convenience than brand.
C) many purchase decisions are made in the store where many sales promotions are found.
D) marketers are offering consumers more promotions to attract and maintain customers.

Question 43

_____ is a recent development whereby companies are customizing their sale promotion programs for key retailers.

A) Incentive marketing
B) Accountability marketing
C) Account-specific marketing
D) Trade marketing

Question 44

Promotional activities that are designed to accelerate the purchase process and generate an immediate increase in sales without communicating information about a brand's unique features or benefits are known as:

A) consumer franchise-building promotion
B) nonfranchise-building promotion
C) sweepstakes
D) trade promotions

Question 45

Which of the following statements describes how brand equity is affected by the increased role of sales promotion?

A) Critics argue that trade promotions generally result in higher brand equity.
B) Sales promotions do not contribute to the erosion of brand equity.
C) There is a belief that sales promotion can be over used by too much frequency, resulting in a decrease in brand equity.
D) There is strong agreement that any type of sales promotion activity detracts from brand equity.

Question 46

Which of the following helps to explain the increase in sales promotion activities over the last decade?

A) The increase of brand loyalty in many product categories
B) The tremendous decrease in the number of new products
C) The increased emphasis on long term strategy and performance by most companies
D) The growing power of retailers and their demands for sales performance

Question 47

The toy company Hasbro teamed with the retailer Toys R Us to create direct mail booklets offering discounts on Hasbro toys good only at Toys R Us stores.This is an example of:

A) incentive marketing
B) a franchise building promotion
C) brand equity building
D) account-specific marketing

Question 48

Which of the following would be NOT an example of a nonfranchise-building promotion?

A) Price-off deals
B) Bonus packs
C) Image advertising
D) Trade promotions

Question 49

Which of the following statements does NOT correctly describe the relationship between building brand equity and sales promotion?

A) Sales promotion is an ineffective tool for building brand equity.
B) Companies are asking their promotion agencies to think strategically and develop programs that do more than increase short-term sales.
C) Companies want promotions that require consumer involvement with their brands.
D) Sales promotion techniques such as contests and premium offers are often used to draw attention to an ad, increase involvement with the ad, and help build relationships with consumers.

Question 50

One problem resulting from the overuse of sales promotion is a decrease in:

A) retailer power
B) ad readership scores
C) brand equity
D) promotional traps

Question 51

Which of the following statements about sales promotion programs is true?

A) Sales promotion programs are targeted only at consumers.
B) Many sales promotion programs are designed to motivate distributors and retailers to carry a product and push it through to their customers.
C) Nearly three quarters of all sales promotion dollars are spent on consumer promotions.
D) Sales promotion dollars for most companies are allocated equally between consumers and the trade.

Question 52

Which of the following types of sales promotions would NOT be used to help in the introduction of a new product?

A) Sampling
B) New usage suggestions
C) Premiums
D) Rebates and refunds

Question 53

Which of the following is an example of a sales promotion that can be used to contribute to franchise building?

A) A 50-cents off coupon on a box of Minute Rice to encourage repurchase.
B) A sweepstakes or contest that uses a theme which is consistent with the image or positioning of the brand.
C) A bonus jar of Hellmann's Mayonnaise, offering 1 L for the price of 750 mL.
D) A price reduction of $5 on a pair of Lee jeans.

Question 54

Over the past decade,the amount of money consumer products firms devote to ______ has been declining while the amount spent on _____ has been increasing.

A) consumer promotions; media advertising
B) media advertising; sales promotions
C) trade promotions; media advertising
D) trade promotions; consumer promotions

Question 55

Eastern Canadian Sea Foods devotes most of its marketing budget to trade discounts in the form of off-invoice and promotional allowances so its canned tuna and salmon brands can remain price competitive with private label brands.The heavy emphasis on trade promotion makes it difficult to:

A) encourage consumers to buy on the basis of price
B) build and maintain store equity for retailers that carry the Eastern Canadian brand
C) build an Eastern Canadian brand identity and image
D) encourage retailers to use Eastern Canadian's planograms

Question 56

All of the following are examples of consumer-oriented sales promotion activities EXCEPT:

A) samples
B) bonus packs
C) trade shows
D) refunds/rebates

Question 57

Which of the following developments have resulted in a transfer of power from manufacturers to retailers?

A) The advent of optical scanners and computers gave manufacturers access to sales information.
B) Manufacturers are spending more money on media advertising.
C) Retailers have access to data concerning how quickly products turn over, and which products make money.
D) Manufacturers are introducing more private-label brands.

Question 58

Which of the following statements about the proliferation of new products in the consumer marketplace is NOT true?

A) Consumer product companies are launching fewer new products each year.
B) Sales promotion programs play an important role in motivating retailers to allocate shelf space to new products.
C) Supermarkets now carry an average of 30,000 products compared to 13,000 in 1982.
D) Many retailers require promotional deals such as discounts and allowances just to handle a new product.

Question 59

Consumer-franchise or image building for a brand:

A) is the exclusive responsibility of advertising
B) is accomplished through short-term price-oriented promotions
C) is becoming less important to marketers as competition intensifies
D) can be accomplished through consumer promotions that help build its brand equity

Question 60

Tropicana developed a "Win the Perfect Vacation" sweepstakes to complement an advertising campaign theme promoting its grapefruit juice as the perfect beverage.This is an example of:

A) event marketing
B) franchise building promotion
C) high-involvement sales promotion
D) sales promotion trap

Question 61

The sales promotion tool that critics contend is most guilty of detracting from brand equity and at the same time being detrimental to a brand franchise is:

A) sweepstakes and contests
B) trade promotions
C) frequent patronage programs
D) event sponsorships

Question 62

The oldest,most widely used,and most effective sales promotion tool is:

A) coupons
B) sampling
C) rebates
D) event sponsorship

Question 63

_____ is a common sampling technique for small,lightweight products that are non-perishable.

A) Door-to-door sampling
B) Sampling through the mail
C) Location sampling
D) On-package sampling

Question 64

Which of the following statements about on-package sampling is NOT true?

A) This can be a very costly sampling method, particularly for multiproduct companies.
B) A limitation of this sampling method is that the sample is distributed only to purchasers of the carrier brand.
C) On-package samples can be distributed by attaching them to products not made by the distributing company.
D) The distribution of on-package samples can be broadened by attaching them to multiple brands or to products made by other companies.

Question 65

Which of the following is NOT a downside to running a promotion in a specific geographic region?

A) Additional managerial commitment required
B) Greater expenses resulting from fragmented efforts
C) Consumer confusion when they shop at their local store
D) National accounts' reluctance to run different promotions in different regions

Question 66

Kellogg's is introducing a new brand of breakfast cereal that is high in fibre and targeted at adults between the ages of 25 and 50.The marketing objectives for the introduction are to generate trial and repeat purchase during the 3-month product launch.Which of the following sales promotion tools work best for Kellogg's?

A) Sampling and rebates
B) Rebates and high value checkout coupons
C) Bonus packs, trade allowances, and slotting fees
D) High value coupons and sampling

Question 67

Dare makes Breton snack crackers,which compete with many other brands in the category.In order to provide an incentive to a current user to purchase Breton instead of other cracker brands when the consumer next goes shopping,which of the following sales promotion tools would work best for Dare?

A) In-store sampling
B) High value checkout coupons
C) Sponsorship of the local Easter parade
D) In-pack coupons for any variety of Breton crackers

Question 68

_____ is generally considered the most effective method for generating trial of a new product.

A) Couponing
B) Sampling
C) A rebate award
D) A bonus pack

Question 69

Which of the following is a reasonable objective for consumer-oriented sales promotions?

A) To obtain trial of a new brand
B) To encourage off-shelf displays in major grocery stores
C) To increase consumption of an established brand
D) To enhance advertising and marketing efforts

Question 70

A recent study of coupon redemption patterns found that:

A) many coupons are redeemed just before the expiration date rather than in the period following the initial drop
B) most coupons are redeemed immediately following the initial coupon drop
C) most coupons are redeemed on Thursdays
D) most consumers do not use coupons

Question 71

Which of the following is NOT a tactical decision the marketer faces when planning a sales promotion?

A) The value of the free in-pack premium
B) The percentage discount that the face value of checkout coupons represents
C) Seasonality of purchase and length of promotion
D) The prime time evenings that attract the biggest percentage of the brand's target market

Question 72

An advantage of coupons is that they:

A) build brand loyalty
B) generally elicit immediate response from consumers
C) are very effective even without brand name awareness
D) allow a marketer to offer a price reduction to consumers who are price sensitive without having to reduce the price for everyone

Question 73

Which of the following is NOT a sampling distribution method?

A) Door-to-door sampling
B) Sampling through the mail
C) Self-liquidating sampling
D) In-or on-package sampling

Question 74

Sampling would be an appropriate promotional strategy to do each of the following EXCEPT:

A) increase the market share of an established brand
B) provide the marketer with an immediate gauge as to how well the product will do in the marketplace
C) assist consumers to experience the brand directly
D) induce trial of a new brand that is clearly superior to the competition

Question 75

Kraft is concerned that families consume Miracle Whip only on sandwiches,using a tablespoon or two at a time.In order to increase consumption and therefore,sales,which of the following sales promotion tools would work best for Kraft?

A) Sampling and rebates
B) Recipe books showing alternative uses for Miracle Whip
C) Bonus packs, trade allowances, and slotting fees
D) In-store coupons for $1.00 off Miracle Whip

Question 76

Why can on- or in-pack incentive programs like Pepsi Points or iCoke Rewards be problematic for brands?

A) The consumer may experience negative reinforcement when comparing competitive prices.
B) If the promotion is ongoing, it is difficult to predict consumer behaviour should the reinforcement ever stop.
C) Consumer switching behaviour is curtailed.
D) Retailers are not happy having to purchase large amounts of product to support the promotion.

Question 77

Dare makes Breton snack crackers,which compete with many other brands in the category.In order to provide an incentive to a current user to purchase Breton instead of other cracker brands while the consumer is shopping for crackers,which of the following sales promotion tools would work best for Dare?

A) In-store sampling
B) Special pricing of 2 packages for $5 instead of the $2.89 regular price
C) Image advertising
D) In-pack coupons for any variety of Breton crackers

Question 78

_____ occurs at venues such as concerts,cultural festivals,and at a brand's marketing activities.

A) Door-to-door sampling
B) Sampling through the media
C) Sampling through the mail
D) Event sampling

Question 79

______ generate(s)much higher trial rates than advertising and other sales promotion techniques.

A) Sampling
B) Contests
C) Sweepstakes
D) Bonus packs

Question 80

Sampling for a product such as expensive skin cream that is designed to reduce wrinkles over a long period of time might not be feasible because:

A) it cannot be broken down into small sizes
B) it may be too expensive to give away sample sizes that would be adequate to demonstrate the cream's benefits since it has to be used repeatedly
C) it may be too difficult to find a way to distribute the samples
D) consumers may think it is of poor quality since samples are being given away