Deck 18: Global Marketing and RD

Question 1

The marketing mix is comprised of product attributes, distribution strategy, communication strategy, and pricing strategy.

Answer 1

True
Explanation: The four elements that constitute a firm's marketing mix: product attributes, distribution strategy, communication strategy, and pricing strategy.

Question 2

An increase in car ownership, the number of two-income households, and the number of households with a refrigerator have all contributed to the more fragmented retail system found in developed countries.

Answer 2

False
Explanation: There is a tendency for greater retail concentration in developed countries. Three factors that contribute to this are the increases in car ownership, number of households with refrigerators and freezers, and number of two-income households. All these factors have changed shopping habits and facilitated the growth of large retail establishments sited away from traditional shopping areas.

Question 3

Predatory pricing refers to the fact that a firm's pricing strategy in one market may have an impact on its rivals' pricing strategy in another market.

Answer 3

False
Explanation: Multipoint pricing refers to the fact that a firm's pricing strategy in one market may have an impact on its rivals' pricing strategy in another market.

Question 4

Markets can be segmented in only one way: by socio-cultural factors.

Question 5

In a competitive market, prices have to be higher than in a market where the firm has a monopoly.

Question 6

The structure of market segments may differ significantly from country to country.

Question 7

Products sell well when their attributes match consumer needs.

Question 8

The set of choices the firm offers to its targeted markets is known as the marketing mix.

Question 9

The entry of large discount superstores such as Tesco and Carrefour has shortened channel length in some countries.

Question 10

Concentrated retail systems tend to promote the growth of wholesalers to serve retailers, which lengthens channels.

Question 11

Import agents are typically limited to independent trading houses.

Question 12

The four main differences between distribution systems are retail concentration, channel length, channel exclusivity, and channel quality.

Question 13

Elasticity of demand for a product in a given country is determined by income level and competitive conditions.

Question 14

A company that depends on mass media advertising to communicate its marketing message to potential consumers is using a push strategy.

Question 15

A push strategy makes sense when distribution channels are short.

Question 16

The more fragmented the retail system, the more expensive it is for a firm to make contact with each individual retailer.

Question 17

Source effects occur when the receiver of the message evaluates the message based on the status or image of the sender.

Question 18

In a concentrated retail system, there are many retailers but none of them have a significant share of the market.

Question 19

If a firm manufactures its product in a particular country, it can sell directly to the consumer, to the retailer, or to the wholesaler. The same options are not available to a firm that manufactures outside the country.

Question 20

Firms based in less-developed nations tend to build a lot of extra performance attributes into their products.

Question 21

The identification of distinct groups of consumers whose purchasing behavior differs from others in important ways is known as _____.

A) market segmentation
B) market penetration
C) diversification strategy
D) differentiation

Question 22

Which of the following is one of the four elements that constitute a firm's marketing mix?

A) Inventory accounting
B) Product reengineering
C) Reverse engineering
D) Distribution strategy

Question 23

Consumers in highly developed countries value _____ as compared to their counterparts in less developed nations.

A) product price
B) product reliability
C) product attributes
D) product value

Question 24

The way a product is delivered is determined by the _____.

A) firm's entry strategy
B) firm's product positioning
C) target market
D) market segments

Question 25

Research has long maintained that a major factor of success for new products is the closeness of the relationship between:

A) finance and marketing.
B) marketing and R&D.
C) finance and materials management.
D) finance and R&D.

Question 26

Contrary to Levitt's suggestions, consumers in the most developed countries are often:

A) willing to sacrifice their preferred attributes for lower prices.
B) not willing to pay more for products that have additional features customized to their tastes.
C) not willing to sacrifice their preferred attributes for lower prices.
D) willing to accept globally standardized products that have been developed with the lowest common denominator in mind.

Question 27

A _____ retail system is one in which there are many retailers, no one of which has a major share of the market.

A) concentrated
B) consolidated
C) focused
D) fragmented

Question 28

Tight cross-functional integration between R&D, production, and marketing maximizes the time to market.

Question 29

The most important aspect of a country's cultural differences, particularly important in foodstuffs and beverages, is the impact of _____.

A) values
B) traditions
C) norms
D) attitudes

Question 30

The continuing persistence of _____ differences between nations acts as a major brake on any trend toward global consumer tastes and preferences.

A) technological and industrial
B) institutional and political
C) cultural and economic
D) GNP level and growth rate

Question 31

According to Levitt, which of the following statements is true?

A) Technology drives the world toward a converging commonalty.
B) There are accustomed differences in national preferences.
C) The multinational corporation operates in a number of countries at low relative costs.
D) The global corporation operates with resolute consistency at high relative costs.

Question 32

If market segments transcend national borders:

A) the company should develop unique products for each national market.
B) the company can view the global market as a single entity and pursue a global strategy.
C) a localization strategy would be appropriate.
D) consumers will have differing purchasing behavior in different nations.

Question 33

Firms pursuing a multipoint pricing strategy on an international scale will price low worldwide in an attempt to build global sales volume as rapidly as possible.

Question 34

The means a firm chooses for delivering the product to the consumer is its _____.

A) communication strategy
B) segmentation strategy
C) product attributes
D) distribution strategy

Question 35

The rate of new-product development seems to be lesser in countries where more money is spent on basic and applied research and development.

Question 36

For a product development team to function effectively and meet all its development milestones, the team should be composed of at least one member from each key function.

Question 37

A country with high car ownership, a large number of households with refrigerators, and a large number of two-income families tend to have _____.

A) retail division
B) retail dispersion
C) retail concentration
D) retail fragmentation

Question 38

"Creative destruction" makes it important for companies to stay on the leading edge of technology.

Question 39

In a concentrated retail system:

A) there are many retailers who have a major share of the market.
B) there are many retailers, no one of which has a major share of the market.
C) a few retailers supply a small segment of the market.
D) a few retailers supply most of the market.

Question 40

The set of choices the firm offers to its targeted market is known as the ____.

A) marketing mix
B) marketing concept
C) marketing strategy
D) market promotion

Question 41

In the 1960s, the Swedish vacuum manufacturer Electrolux successfully marketed vacuums in the United Kingdom with the slogan "Nothing sucks like an Electrolux". The informal United States meaning of the word 'sucks' was already well known in the United Kingdom at the time, and the company hoped the slogan, with its possible double entendre, would gain attention. When this slogan was used in the American market, it was a catastrophe. This is an example of _____.

A) cultural differences
B) religious differences
C) source effects
D) noise levels

Question 42

Which of the following statements about the choice of distribution strategy is true?

A) The longer a channel, the greater the aggregate markup, and the higher the price that consumers are charged for the final product.
B) If price is an important competitive weapon and if the firm does not want to see its profit margins squeezed, other things being equal, the firm would prefer to use a longer channel.
C) The shorter a channel, the greater the aggregate markup, and the higher the price that consumers are charged for the final product.
D) An international business must use shorter channels in countries where the retail sector is fragmented and longer channels in countries where the retail sector is concentrated.

Question 43

The extent to which the place of manufacturing influences product evaluations is known as _____.

A) source effects
B) country of origin effects
C) noise effects
D) location effects

Question 44

With a concentrated retail sector:

A) a relatively large sales force is required.
B) the orders generated from each sales call can be large.
C) there are long channels of distribution.
D) it is expensive for the firm to make contact with each individual retailer.

Question 45

The most important determinant of channel length is the degree to which a retail system is _____.

A) concentrated
B) fragmented
C) decentralized
D) globalized

Question 46

Which of the following countries has a concentrated retail system?

A) China
B) United States
C) Japan
D) India

Question 47

When a channel is exclusive:

A) the firm sells and distributes only high-end products.
B) it is controlled by market leaders or by firms who have a niche market.
C) the firm's products are focused only on the elite, upper class customers.
D) it is often difficult for a new firm to get access to shelf space in supermarkets.

Question 48

Which of the following statements about retail systems is true?

A) One factor contributing to greater retail concentration is an increase in car ownership.
B) The number of households with refrigerators leads to lesser retail concentration in developed countries.
C) There is a tendency for greater retail concentration in many developing countries.
D) Retail systems are very fragmented in developed countries.

Question 49

The "Swiss Made" label has leveraged several watch-making companies (for example, TAG Heuer) for decades now. This is an example of a ____ effect.

A) linguistic
B) country of origin
C) noise
D) cultural

Question 50

When the receiver of a message evaluates a message based on the status or image of the sender, _____ are said to have occurred.

A) sender effects
B) noise effects
C) source effects
D) communication effects

Question 51

Which of the following statements about barriers to international communication is true?

A) Source effects occur when the receiver of the message evaluates the message on the basis of the location of the sender.
B) The best way for a firm to overcome cultural barriers is to use local input.
C) Source effects and country of origin effects are always negative.
D) Noise is extremely high in highly developed countries such as the United States.

Question 52

_____ refers to the number of intermediaries between the producer (or manufacturer) and the consumer.

A) Channel length
B) Channel exclusivity
C) Channel quality
D) Channel speed

Question 53

To overcome cultural barriers, companies should:

A) develop products specifically for each market.
B) focus on universal needs.
C) focus only on international market segments.
D) develop cross-cultural literacy.

Question 54

If a producer sells through an import agent, a wholesaler, and a retailer, then:

A) a long channel exists.
B) the retail system must be concentrated.
C) the internet probably plays a big role in the economy.
D) there is no channel.

Question 55

A(n) _____ distribution channel is one that is difficult for outsiders to access.

A) selective
B) intensive
C) exclusive
D) multi-channel

Question 56

Which of the following is an example of a positive source effect?

A) A 3M Post-it note
B) A Dell laptop
C) An Audi R8
D) An Apple iPod

Question 57

Which of the following statements about fragmented retail systems is true?

A) Countries with fragmented retail systems tend to have short channels of distribution.
B) The more fragmented the retail system, the less expensive it is for a firm to make contact with each individual retailer.
C) Fragmented retail systems tend to promote the growth of wholesalers to serve retailers.
D) When the retail sector is very fragmented, it makes sense for the firm to deal directly with retailers.

Question 58

_____ refers to the expertise, competencies, and skills of established retailers in a nation, and their ability to sell and support the products of international businesses.

A) Channel exclusivity
B) Channel knowledge
C) Channel quality
D) Channel skill

Question 59

What kind of retail systems do rural India and China have?

A) Fragmented
B) Direct
C) Indirect
D) Concentrated

Question 60

The probability of effective communications is reduced by:

A) noise.
B) location effects.
C) country of origin effects.
D) source effects.

Question 61

_____ occurs when an individual or business capitalizes on a price differential for a firm's product between two countries by buying the product in the country where the price is low and reselling it in the country where prices are higher.

A) Arbitrage
B) Strategic pricing
C) Price discrimination
D) Market pricing

Question 62

If a _____ change in a price produces a _____ change in demand, then demand is said to be elastic.

A) small; large
B) small; small
C) large; small
D) large; large

Question 63

When a company charges whatever the market will bear, the company is using _____.

A) strategic pricing
B) price discrimination
C) a push strategy
D) a pull strategy

Question 64

Which of the following is one of the important factors in determining the elasticity of demand for a product in a given country?

A) Personal selling
B) Logistics
C) Operating revenue
D) Income level

Question 65

Which of the following statements about price discrimination is true?

A) It exists whenever consumers in a country are charged different prices for the same product.
B) A necessary condition for profitable price discrimination is different price elasticities of demand in different countries.
C) It is the use of price as a competitive weapon to drive weaker competitors out of a national market.
D) It makes economic sense to charge the same prices across countries.

Question 66

In a country where competition is limited:

A) prices will be low.
B) there will be low elasticity of demand.
C) prices will be high.
D) consumers' bargaining power rises.

Question 67

The _____ industry is often thought of as one in which global standardization of the marketing mix is the norm.

A) financial services
B) IT
C) telecommunication
D) manufacturing

Question 68

Which of the following statements is true?

A) Firms in consumer goods industries that are trying to sell to a large segment of the market generally favor a push strategy.
B) Mass communication has cost advantages for firms in consumer goods industries that are trying to sell to a large segment of the market.
C) Direct selling may be the only way to reach consumers in poor nations with low literacy levels.
D) Firms that sell industrial products or other complex products favor a pull strategy.

Question 69

A pull strategy should be used when:

A) the firm is selling industrial products.
B) the distribution channels are short.
C) the distribution channels are long.
D) few print or electronic media are available.

Question 70

A push strategy is appropriate when:

A) there are many choices of electronic media.
B) the firm is selling consumer goods.
C) distribution channels are long.
D) the firm is selling complex new products.

Question 71

Which of the following is an argument that supports global advertising?

A) Standardized advertising lowers the costs of value creation by spreading the fixed costs of developing the advertisements over many countries.
B) Because of concerns about the scarcity of creative talent, some feel that smaller efforts will produce better results than one large effort to develop a campaign.
C) Even though there are cultural differences between nations, a single advertising theme that is effective worldwide can be easily developed.
D) Standardized advertising may be implemented even in the face of advertising regulations.

Question 72

A firm that depends more on mass media advertising to communicate the marketing message to potential consumers is using a _____.

A) pull strategy
B) push strategy
C) standardized strategy
D) localized strategy

Question 73

A measure of the responsiveness of demand for a product to change in price is referred to as:

A) arbitrage demand.
B) predatory pricing.
C) price elasticity of demand.
D) experience curve pricing.

Question 74

Other things being equal, the rate of new-product development seems to be greater in countries where:

A) less money is spent on basic and applied R&D.
B) consumers are affluent.
C) underlying demand is weak.
D) competition is mild.

Question 75

_____ occurs whenever a firm sells a product for a price that is less than the cost of producing it.

A) Resale
B) Plunging
C) Bootlegging
D) Dumping

Question 76

Many firms pursuing a(n) _____ pricing strategy on an international scale will price low worldwide in attempting to build global sales volume as rapidly as possible, even if this means taking large losses initially.

A) multipoint
B) experience curve
C) predatory
D) competitive

Question 77

In order for price discrimination to be successful:

A) there must be a strong case for arbitrage.
B) national markets must be kept separate.
C) demand must be very elastic.
D) a large change in demand must be triggered by a small change in price.

Question 78

_____ pricing is the use of price as a competitive weapon to drive weaker competitors out of a national market.

A) Multipoint
B) Value-based
C) Experience curve
D) Predatory

Question 79

_____ refers to the fact that a firm's pricing strategy in one market may have an impact on its rivals' pricing strategy in another market.

A) Multipoint pricing
B) Experience curve pricing
C) Predatory pricing
D) Competitive pricing

Question 80

When a firm emphasizes personal selling rather than mass media advertising in the promotional mix, the firm is using a _____.

A) standardized strategy
B) pull strategy
C) push strategy
D) localized strategy