Deck 22: Managing Personal Communications: Direct and Database Marketing and Personal Selling

Question 1

Which of the following is an example of a company that serves a niche market?

A) a large apparel manufacturing company that produces a wide range of products for different segments
B) a software company that creates standardized supply chain applications for manufacturers
C) a manufacturer who creates tools such as bolts, latches, door handles etc. for left-handed individuals
D) a large multinational manufacturer of consumer products, FMCG products, and consumer electronics
E) a company that manufactures denim pants for men and women of all ages

Answer 1

C

Question 2

A salesperson sends e-mails to persuade prospects to buy the products of his company. This is a type of ________ marketing.

A) buzz
B) virtual
C) word-of-mouth
D) direct
E) viral

Answer 2

D

Question 3

The management of Raleigh Bicycles observes that the company's selling costs are affected by the increased number of visits that salespeople make to meet dealers. The company decides to reduce its personal selling costs by making sales calls to dealers via telephone. This marketing strategy used by Raleigh is an example of ________.

A) inbound telemarketing
B) search marketing
C) internal marketing
D) outbound telemarketing
E) paid-search marketing

Answer 3

D

Question 4

Which of the following is NOT one of the advantages of direct mail?

A) The cost per thousand is lower than for mass media.
B) It permits target market selectivity.
C) It can be personalized.
D) It allows early testing and response measurement.
E) It is flexible.

Question 5

The catalog you receive from a large apparel store, displaying their new summer collection, is an example of ________ marketing.

A) buzz
B) direct
C) virtual
D) word-of-mouth
E) interactive

Question 6

Catalog marketing and telemarketing are examples of indirect marketing.

Question 7

Which of the following is a disadvantage of direct marketing?

A) invasion of privacy
B) inability to build brand awareness
C) low chances of customers avoiding messages
D) inability to control marketing communication
E) inability to maintain information security

Question 8

Greta is attempting to get as many orders as possible. Which direct marketing tool is generally associated with the highest order response rate?

A) e-mail to an internal company list
B) direct mail to an internal company list
C) e-mail to a general list
D) direct mail to a general list
E) banner advertising on the company's Web site

Question 9

OrdOnline, a pure click company offering online auctioning, decides to launch a promotional program to increase its sales. The company identifies customers who have made at least three purchases and spent at least $150 in the past six months and offers discount coupons to these customers. Which of the following strategies is used here for targeting customers?

A) viral marketing
B) objective screening
C) internal targeting
D) catalog marketing
E) RFM formula targeting

Question 10

Which of the following is an element of an offer strategy?

A) the medium used for delivery
B) the number of customers in the locality
C) the vision of the company
D) the skills required for production
E) the details of customer order received

Question 11

Market demassification has resulted in ________.

A) niche market creation
B) product standardization
C) mass production practices
D) intrinsic marketing channels
E) just-in-time production

Question 12

Which of the following is a factor considered when a customer is evaluated based on the RFM formula?

A) the amount of time passed after the customer's last visit
B) the product categories purchased by the customer
C) the mode of payment used by the customer
D) the location from which the customer has bought goods
E) the type of feedback provided by the customer

Question 13

Greta is marketing a product that is technologically advanced and requires a great deal of explanation. Which direct response tool should she use?

A) direct mail
B) e-mail
C) infomercial
D) inbound telemarketing
E) outbound telemarketing

Question 14

Which of the following is a major advantage of using direct mail?

A) Direct mail permits target market selectivity.
B) It is the best suited tool for selling complex products.
C) Campaign testing is not needed for direct mail.
D) Direct mail has very high conversion rates.
E) It is the best method to sell industrial products.

Question 15

In 2010, three top B-to-B ________ were Thermo Scientific lab and research supplies ($10.8 billion), Henry Schien dental, medical, and vet supplies ($7.5 billion) and WESCO International electrical and industry maintenance supplies ($5 billion).

A) inbound telemarketers
B) catalog sellers
C) outbound telemarketers
D) infomercial marketers
E) mobile marketers

Question 16

In 2010, the three top B-to-C ________ were Dell ($52 billion), Staples ($9.8 billion), and CDW ($8.8 billion).

A) inbound telemarketers
B) catalog sellers
C) outbound telemarketers
D) infomercial marketers
E) mobile marketers

Question 17

In outbound telemarketing, the call center employees ________.

A) sell high-involvement products
B) initiate calls from a location closer to prospects
C) offer huge discounts to customers
D) initiate calls to prospects and customers
E) answer the queries of consumers who call for information

Question 18

During the 2012 election, much of the $690 million raised online by the Obama campaign resulted from carefully targeted and tested e-mails.

Question 19

The practice of using call centers, where employees receive calls from customers and provide service by taking orders and answering queries, is called ________.

A) customer response marketing
B) guerilla marketing
C) reactive marketing
D) internal marketing
E) inbound telemarketing

Question 20

Direct marketing has not been growing as fast as US retail sales.

Question 21

Direct mail can produce prospect leads, strengthen customer relationships, inform and educate customers, remind customers of offers, and reinforce recent customer purchase decisions.

Question 22

How have sellers benefited from market demassification?

Question 23

Business-to-consumer telemarketing is increasing.

Question 24

A company's best prospects are customers who have never bought its products.

Question 25

If a company exaggerates the features of its products in its product catalogue, it can be classified as deception.

Question 26

Points are established for varying RFM levels; the more points, the more attractive the customer.

Question 27

Direct marketers use the RFM formula to select customers according to how much time has passed since their last purchase, how many times they have purchased, and how much they have spent since becoming a customer.

Question 28

How do successful direct marketers view customer interactions?

Question 29

A direct marketer must consider returned merchandise and bad debts when s/he determines the needed break-even response rate for direct mail.

Question 30

Direct marketing has the ability to test different elements of an offer strategy under real marketplace conditions.

Question 31

Direct marketing produced $2.05 trillion in sales in 2012, accounting for approximately 8.7 percent of GDP.

Question 32

How have consumers benefited from market demassification?

Question 33

What is direct marketing? What are the various channels that direct marketers use?

Question 34

Business-to-business telemarketing is increasing.

Question 35

How did the Obama campaign use direct marketing during the 2012 election?

Question 36

The Internet and catalog retailing industry includes 20,000 companies with combined annual revenue of $350 billion.

Question 37

One of the shortcomings of direct marketing is that the firm cannot easily measure the response.

Question 38

Direct mail permits target market selectivity and allows early testing and response measurement.

Question 39

Although it varies with product category, price, and the nature of the offering, in general, average response rates for e-mails is higher than order-response rates for letter-sized direct mail.

Question 40

If a specific campaign does not break even in the short run, it will not be profitable in the long run if we factor in customer lifetime value by calculating the average customer longevity, average customer annual expenditure, and average gross margin, minus the average cost of customer acquisition and maintenance (discounted for the opportunity cost of money).

Question 41

Database marketing is ideal when a company does not have direct contact with its customers.

Question 42

Roler Telecom, a leading mobile telephone operator in Asia, engages in aggressive marketing promotions. The company sends promotional messages to customers and makes promotional calls on a regular basis. However, these aggressive promotion efforts often irritate its customers. What could be the likely outcome of this?

Question 43

Which of the following is a positive factor when considering the development of a customer database?

A) The product is a once-in-a-lifetime purchase.
B) There is no contact between the buyer and seller.
C) There is a lot of customer churn.
D) The unit sale is very small.
E) Customer lifetime value is high.

Question 44

In which of the following cases is building a database worthwhile for the company?

A) where the product is a once-in-a-lifetime purchase
B) where customers show little loyalty to a brand
C) where the company has a long relationship with its customers
D) where the unit sale is very small
E) where the cost of gathering the information is high

Question 45

DB Bank is launching a new investment product targeting senior citizens in the United States. The company decides to use direct marketing for selling the product. What direct marketing strategy would allow the company early testing and response measurement of the product?

Question 46

Which of the following statements demonstrates behavioral loyalty toward a brand?

A) 2Wheels has very customer-friendly return policies for its products.
B) I always buy 2Wheels products when I'm looking for bike accessories.
C) Most of my friends agree that 2Wheels is the best place for durable biking gear.
D) 2Wheels has the friendliest customer service people I've ever met.
E) I think that 2Wheels products are the highest-quality products in their price range.

Question 47

Which of the following is NOT conducive to database marketing?

A) Rushbury Theater relies on the generosity of donors to keep functioning.
B) Kenilworthy retails luxury handbags and leather accessories to a select clientele.
C) 2Wheels sells its most profitable products to repeat customers.
D) Uncle Jim's sells its range of snacks in stores throughout the country.
E) PetZone offers obedience classes, a doggie daycare, and other services for pets in the Manhattan area.

Question 48

What are the elements of a direct mail offer? How can each be tested?

Question 49

Why do companies use infomercials?

Question 50

Most direct marketers apply the RFM formula to select customers. Explain this formula and how it is used to select customers.

Question 51

Why is direct mail popular among marketers? What are its weaknesses?

Question 52

Integron Inc., a company that manufactures office furniture, has recently observed a dip in its profitability. Salespeople visit an average prospect at least six times before closing a deal. What suggestion can you give the company to reduce this expense of direct marketing and increase its profitability?

Question 53

The Internet provides marketers and consumers with opportunities for much greater interaction and ________ than do other marketing channels.

A) control
B) data security
C) high involvement selling
D) order conversion
E) individualization

Question 54

What are the five elements of an offer strategy?

Question 55

Describe the darker side of direct marketing solicitations.

Question 56

In which of the following cases is building a database worthwhile for the company?

A) Clare's creates personalized sculptures for special occasions.
B) Sales of Clarity soap have fallen over the past few months in all regions.
C) 2Wheels sells its most profitable products to repeat customers.
D) Uncle Jim's sells its range of snacks in stores throughout the country.
E) Ready-to-wear clothes brand Zeep targets the teen and tween market throughout the United States.

Question 57

How do direct mail response rates relate to a campaign's long-term impact? Provide an example.

Question 58

The offer strategy has five elements: the product, the offer, the medium, the distribution method, and the ________.

A) outside envelope
B) creative strategy
C) sales letter
D) circular
E) reply form

Question 59

The darker side of direct marketing, from a consumer perspective, includes all of the following EXCEPT ________.

A) irritation
B) unfairness
C) deception and fraud
D) federal regulation
E) invasion of privacy

Question 60

Which of the following is most likely to use database marketing?

A) an airline
B) a candy bar manufacturer
C) a fast-food chain
D) a toothpaste manufacturer
E) a hairstylist

Question 61

Information gathering refers to the act of conducting market research and doing intelligence work.

Question 62

The original and oldest form of direct marketing is ________.

A) billboards
B) banner advertising
C) mail campaigns
D) outbound telemarketing calls
E) field sales calls

Question 63

The term sales representative covers a broad range of positions, tasks, and responsibilities. List and briefly describe each of the positions.

Question 64

US firms spend more on sales forces and sales force materials than on any other promotional method.

Question 65

Which of the following tasks of the salesforce refers to conducting market research and doing intelligence work?

A) servicing
B) communicating
C) targeting
D) prospecting
E) information gathering

Question 66

Targeting refers to the process of deciding which customers will get scarce products during product shortages.

Question 67

In 2012, more than 20 percent of the total workforce worked full time in sales occupations, both nonprofit and for profit.

Question 68

Demand creators are not permitted to take an order but expected rather to build goodwill or educate the actual or potential user.

Question 69

A salesperson calling on supermarkets to take repeat orders is called an order taker.

Question 70

A sales representative whose expertise is in unraveling customers' problem is called a(n) ________.

A) order taker
B) missionary
C) technician
D) solution vendor
E) demand creator

Question 71

Briefly explain the various tasks that the salespeople of an organization perform.

Question 72

What situations are not conducive to database marketing?

Question 73

In general, what are the five ways companies use database marketing?

Question 74

To manage costs, most companies are choosing a leveraged sales force that focuses reps on selling the company's more complex and customized products to large accounts and uses inside salespeople and online ordering for low-end selling.

Question 75

What are the five main challenges associated with database marketing?

Question 76

Robert is hired as a sales representative for a company that manufactures fire extinguishers. His job description reads as follows: "The key duty of the sales representative is to unravel the customer's problems using the company's products." Which of the following positions would best describe Robert's profile?

A) deliverer
B) technical salesperson
C) missionary salesperson
D) order taker
E) solution vendor

Question 77

Gordron Inc. manufactures and markets medical equipment. To ensure that its salespeople are knowledgeable enough to answer all product queries, the company hires only those individuals who have a good understanding of both the medical profession and the mechanics of the equipment used. Which of the following is the most accurate classification of Gordron's salesforce?

A) technicians
B) demand creators
C) deliverers
D) order takers
E) missionaries

Question 78

A salesperson performing over-the-counter sales in a medical store can be referred to as a(n) ________.

A) order taker
B) demand creator
C) solution vendor
D) phisher
E) missionary

Question 79

A salesperson who relies on creative methods for selling a company's tangible or intangible offerings is called a(n) ________.

A) demand creator
B) deliverer
C) order taker
D) missionary
E) solution vendor

Question 80

Alduro Chemicals, a manufacturer of detergents, delivers chemicals used for commercial washing to various hoteliers in the United States. Most of the company's revenue comes from routine orders from its existing customers. The company uses unskilled salespeople to collect requirements from its customers. These unskilled customers are known as ________.

A) demand creators
B) deliverers
C) missionaries
D) order takers
E) solution vendors