Deck 5: Strategy in Marketing Channels

Question 1

To achieve distribution objectives, most firms will have to address all of the following except:

A)Role distribution plays in the firm's overall objectives and strategies.
B)Impact of distribution on operations planning.
C)Kinds of channel members should be selected to meet the firm's distribution objectives.
D)Evaluation of channel member performance.
E)Management of marketing channels to implement the firm's channel strategy.

Answer 1

B

Question 2

Which of the following is a false statement about Edward D. Jones and Company?

A)They have consciously decided to avoid Internet sales.
B)The company opens four new bricks and mortar offices per day.
C)Customers desire human contact.
D)Marketing channels of physical offices and "real-live" brokers are essential to the company's core mission.
E)The company maintains a pretax profit of 10% which is below the industry average.

Answer 2

E

Question 3

How much emphasis should be placed on each strategic variable of the marketing mix is:

A)A question without a general answer.
B)A direct function of the size of the firm.
C)Almost always most critical in high-tech companies.
D)A fairly clear-cut formula of Ts = f(P1,P2,P3,P4).
E)Dependent upon the firm's goals and objectives.

Answer 3

A

Question 4

Channel strategy may be of more importance than the other strategic variables of the marketing mix and is also important to:

A)The operations strategy.
B)The development of the breadth of the product line.
C)The firm's overall objectives and strategies.
D)The firm's competitive position in the market place.
E)The level of profits the firm achieves.

Question 5

Which of the following is not one of the basic distribution decisions that most firms must address?

A)Which individual should be chosen as channel manager
B)The role distribution should play in the firm's overall objectives and strategies
C)The role distribution should play in the marketing mix
D)How the firm's channels should be designed to achieve its distribution objectives
E)How channel member performance can be evaluated

Question 6

Which of the following is a false statement about the relationship between channel strategy and marketing strategy?

A)Channel strategy is concerned with the place aspect of the marketing strategy.
B)Channel strategy is narrower in scope than the marketing strategy.
C)Channel strategy focuses on distribution objectives.
D)The channel strategy is important to the firm's overall objectives.
E)The marketing channel strategy focuses on product, price, and promotion.

Question 7

The more crucial distribution objectives are to a firm's long-run success:

A)The more frequently channel strategy should be revised.
B)The higher the level of management at which it should be considered.
C)The higher the cost of developing the necessary distribution systems.
D)The more often an environmental analysis should be conducted.
E)The more important the firm's mission and objectives become.

Question 8

The most fundamental distribution decision of all for any firm or organization to consider is the role:

A)Distribution will play in the marketing mix.
B)Distribution will play in channel design.
C)Distribution will play in the firm's overall objectives and strategies.
D)Distribution will play in channel management.
E)Distribution will play in channel member evaluation.

Question 9

Which of the following is not a condition that argues for placing strategic emphasis on distribution in the marketing mix?

A)Parity exists among competitors' pricing.
B)Distribution is the most relevant variable for satisfying target market demand.
C)Little vulnerability exists because of strong competitor attention to distribution.
D)Distribution can enhance the firm by creating a synergy.
E)Competitors enjoy parity in the promotion variable of the marketing mix.

Question 10

The dynamic nature of channel management effectively mandates that to make distribution decisions, the channel manager:

A)Develop a "fire fighting" mentality to handle the almost constant change.
B)Utilize ad hoc committees to handle each unique situation as it arises.
C)Recognize that a large number and variety of channel members precludes developing effective guidelines for decision-making.
D)Formulate a marketing channel strategy.
E)Be reactive to changing market conditions.

Question 11

Pertaining to the release of movies, windowing is a practice by which movie producers stagger the release of movies for various distributors. Which of the following statements about windowing is false?

A)Windowing was established to help the movie industry maximize total revenues.
B)The practice essentially made movie theatres exclusive distributors for the first four months after a movie's release.
C)Windowing greatly benefited movie theaters.
D)Windowing greatly threatened movie theaters.
E)Windowing may be replaced with new approach to distribution that shortened the time consumers can purchase movies.

Question 12

The main reason WD-40 is in 75 percent of all U.S. households seems to be:

A)Its efficient inbound logistics.
B)Marketing and sales.
C)Its retail distribution channels.
D)Technology development.
E)Procurement.

Question 13

Channel strategy is best conducted:

A)On an ad hoc basis.
B)On a "cross that bridge when you come to it" basis.
C)On a firefighting basis.
D)By following a set of guiding principles basis.
E)By developing personal relationships with other channel managers.

Question 14

___________ is, the broad principles by which the firm expects to achieve its distribution objectives for its target market(s).:

A)Corporate strategy
B)Channel strategy.
C)Marketing strategy.
D)Service to customers.
E)Inbound logistics.

Question 15

Volvo GM Heavy Truck Corporation cited in the text illustrates:

A)That aggressive pricing is key.
B)Customer service is key.
C)Heavy inventory carried by dealers is a must for good service.
D)That all too often customers are too spread out.
E)Keeping high levels of inventories is crucial to good customer service.

Question 16

Caterpillar's CEO, Donald V. Fites, makes it clear that the biggest reason for Caterpillar's success has been:

A)A great product.
B)An emphasis on product differentiation.
C)Competitive prices.
D)Its system of distribution and product support.
E)Its product development expertise.

Question 17

The corporate level planning process is concerned with:

A)Communicating corporate guidelines, business definition, and mission.
B)Communicating business guidelines.
C)Communicating the program definition.
D)Integrating functional strategies.
E)Developing a one-year plan and budget for departments.

Question 18

Which of the following statements regarding the marketing mix is true?

A)When distribution is the most relevant marketing mix element, it is because power retailers are channel members.
B)Distribution usually is the leading variable in the marketing mix unless the manufacturer owns and operates its own retailing operation.
C)As the number of channel members expands, so does the importance of distribution in the marketing mix.
D)The most emphasis should be placed on profits and placement in developing a marketing mix.
E)Distribution can offer a more favorable basis for developing the competitive edge because it is not easily copied.

Question 19

Partnerships with dealers, such as that enjoyed by Caterpillar tractors are based largely on:

A)Good communication.
B)Long-term channel strategy.
C)Very low prices.
D)Using technology and up-to-date information systems.
E)Common goals.

Question 20

Making distribution a priority is most appropriate for which of the following?

A)Consumer services providers
B)Consumer luxury goods manufacturers
C)Firms using intensive distribution
D)Firms in international business
E)No such generality can be made.

Question 21

______________ refers to a firm's attainment of an advantageous position in the market relative to competitors.

A)Channel and placement strategy
B)Differential advantage
C)Respect
D)Power
E)Marketing strategy

Question 22

A well positioned channel:

A)Means the channel members support the strategy the manufacturer is using to gain differential advantage.
B)Has high synergy between the manufacturer and the channel members.
C)Decreases the likelihood the manufacturer will be well-positioned with final customers.
D)Requires a short-term strategic view.
E)Offers increased profits to all channel members.

Question 23

If a manufacturer's products are "middle of the road" in quality and aimed at the mass market, its distribution strategy should stress:

A)Exclusive distribution.
B)Broad coverage of the market.
C)Very selective distribution.
D)Intensive or exclusive distribution.
E)Regional distribution.

Question 24

Channel strategy should guide channel design so as to help the firm attain:

A)The most efficient channel.
B)The lowest cost channel.
C)Differential advantage.
D)Increased profits.
E)Power over other members of the channel.

Question 25

Generally the greater the degree of distribution intensity the __________ will be the closeness of the channel relationship.

A)closer
B)longer
C)looser
D)more intense
E)selective

Question 26

The strategic alliance between Procter & Gamble and Wal-Mart is an example of the __________ that can be created between manufacturers and channel members.

A)legal partnerships
B)synergy
C)profit
D)value
E)exclusivity

Question 27

Many manufacturers have neglected distribution because:

A)Product, price and promotion are more difficult to control.
B)Independent channel members can be difficult to control.
C)It takes too long for distribution to impact market share.
D)The decisions are difficult to make.
E)It is hard to obtain the information.

Question 28

Competitive advantages gained through distribution tend to be:

A)Short-lived.
B)Long-lived.
C)Less costly to develop.
D)Much more difficult to develop than product advantages.
E)Almost always more expensive to develop.

Question 29

How close a channel relationship any given manufacturer should develop with its channel members is really a question of:

A)Cost.
B)Strategy.
C)Channel lengths.
D)Tactics.
E)Behavioral dimensions.

Question 30

The tactics a channel manager can use to motivate channel members:

A)Are most effective when they provide financial gains to the channel member.
B)Are severely limited by law.
C)Are very diverse in approach.
D)Are best when they take a subtle approach.
E)Are difficult to implement.

Question 31

Which of the following statements regarding synergy through distribution is false?

A)It is sometimes referred to as distribution partnerships.
B)It is sometimes referred to as strategic alliances.
C)It is sometimes referred to as e-commerce.
D)It is sometimes referred to as networks.
E)It is sometimes referred to as partnering.

Question 32

Infiniti's approach to selling cars, according to the company, stresses:

A)Tradition but with more "class".
B)Aims to communicate to its dealers that they must be the best and create high consumer expectations.
C)Extensive use of the Internet.
D)A strict one-price policy.
E)elimination of dealer salespeople to move to a higher technological computer-based approach to car sales.

Question 33

From the perspective of __________, channel members are an extension of the manufacturer's own organization.

A)competitive manufacturers
B)suppliers
C)customers
D)managers
E)employees

Question 34

The principal lesson BMW learned from Michael Dell of Dell Computer is:

A)Customers are looking for the lowest price.
B)Highly standardized products sell best.
C)Custom made distribution can attract customers.
D)Customers who need no technical support will buy from BMW.
E)Insecure customers who are afraid to venture into dealerships will buy from BMW.

Question 35

All of the following are competitive advantages earned in distribution that are not easily copied by competitors except:

A)Superior strategies cannot be developed and implemented quickly.
B)Organizations take a long time to design and build.
C)Talented, capable and dedicated people have to be developed.
D)Understanding of the firm's target market.
E)Development of the organization.

Question 36

After the channel has been designed, the channel manager still has to address fundamental strategic questions regarding all of the following except:

A)The closeness of the relationship with the channel members.
B)How to motivate channel member cooperation.
C)How to use the marketing mix.
D)The intensity of distribution.
E)How channel members can cooperate in achieving the manufacturer's objectives.

Question 37

Channel design should be viewed as:

A)The most important element for gaining differential advantage.
B)One component in the firm's attempt to gain differential advantage.
C)The only real basis for gaining differential advantage.
D)Of little consequence in gaining differential advantage.
E)The second most important element behind pricing.

Question 38

When Mattel sells Barbie's younger sister, Kelly, only at Target stores, Mattel is engaging in:

A)A long-term placement strategy.
B)Channel member selection strategy.
C)Exclusive placement strategy.
D)Target market selection strategy.
E)Intermediary selection strategy.

Question 39

The reputation a manufacturer acquires among channel members for furnishing products, services, financial returns, and systems that are in some way superior to those offered by competing manufacturers is referred to as:

A)Channel position.
B)Channel strength.
C)Channel design.
D)Channel superiority.
E)Channel differentiation.

Question 40

A well-developed marketing channel comprised of the right channel members can create __________ between the manufacturer and channel members.

A)synergy
B)problems
C)a legal partnership
D)unforeseen obstacles
E)conflict

Question 41

The evaluation of channel member performance is likely to be treated as an afterthought unless:

A)The channel manager has detailed procedures and forms for the evaluation.
B)The manufacturer's top management determines the strategic importance of channel member evaluation.
C)Provision for evaluation is made in the design and management of the channel.
D)The board of directors requires an evaluation.
E)Profits begin to decrease.

Question 42

Payment by the manufacturer for obtaining space on retailers' shelves is commonly referred to as a:

A)Trade discount.
B)Promotional allowance.
C)Display and selling aid.
D)Price guarantee.
E)Slotting allowance.

Question 43

The channel manager should attempt to promote __________ among the elements of the marketing mix.

A)the lowest cost tradeoff
B)the highest level of synergy
C)the lowest level of overlap
D)the greatest degree of independence
E)the best case scenario

Question 44

DPA stands for:

A)Distribution price allocation.
B)Distribution product advertising.
C)Distribution portfolio analysis.
D)Distribution production alternatives.
E)Distribution promotion analysis.