kotler_mm14_tif03_ad.doc

Marketing Management, 14e (Kotler/Keller)Chapter 3 Scanning the Marketing Environment, Forecasting Demand, and Conducting Marketing Research

1) As the manager of an organization that is attempting to build a Marketing Information System (MIS), you have been informed that a MIS is built upon three fundamental information sources. The sources are ________, marketing intelligence activities, and marketing research. A) external records and documents B) databases found on the Internet C) consultant reports D) internal company records E) secondary data from government sources such as the Better Business Bureau Answer: DObjective: 1Difficulty: Easy

2) The company's marketing information system should be a mix of what managers think they need, what managers really need, and ________. A) what the marketing research department is able to do B) what consumers are willing to consume C) what the government policies allowD) what is acceptable at the industry level E) what is economically feasible Answer: EObjective: 1Difficulty: Moderate

3) The heart of the internal records system is the ________. A) pay-roll systemB) purchase order cycleC) order-to-payment cycle D) expense cycleE) human resources systemAnswer: CObjective: 2Difficulty: Moderate

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4) The ________ begins with sales representatives and dealers sending orders to the firms and is followed by the sales department preparing invoices, and finally generating shipping and billing documents which are then sent to various departments.A) payroll systemB) market research processC) human resources systemD) expense cycleE) order-to-payment cycle Answer: EObjective: 2Difficulty: Moderate

5) By equipping its sales force with handheld devices with bar-code readers and Internet connections to speed inventory assessment, TaylorMade allows sales executives to have significantly more time to interact with their consumers. This is an example of the use of technology in improving ________. A) sales information systemsB) payroll systemsC) cookiesD) cohort segmentationE) competitive intelligence gatheringAnswer: AObjective: 2AACSB: Use of ITDifficulty: Moderate

6) Companies can practice targeted marketing by using ________–records of Web site usage stored on personal browsers.A) plug-insB) black swansC) cookiesD) trollsE) honey-potsAnswer: CObjective: 2AACSB: Use of ITDifficulty: Easy


7) The internal records system supplies results data, but the marketing intelligence system supplies ________ data. A) internalB) revenueC) thematicD) happenings E) processAnswer: DObjective: 3Difficulty: Easy

8) A ________ is a set of procedures and sources managers use to obtain everyday information about developments in the marketing environment. A) data warehousing system B) viral marketing campaignC) product management system D) marketing intelligence system E) sales information system Answer: DObjective: 3Difficulty: Moderate

10) A company can take several steps to improve the quality of its marketing intelligence. If the company purchases competitive products for study, attends open houses and trade shows, and reads competitors' published reports and stockholder information, the company is using ________ to improve the quality of its marketing intelligence.A) sales-force surrogates B) intermediaries C) external networks D) advisory panels E) customer feedback systems Answer: CObjective: 3Difficulty: Difficult

11) The sites which offer positive or negative product or service reviews and are built by the retailers of a particular product or service are called ________.A) combo sitesB) distributor or sales agent feedback sitesC) public blogsD) independent service review forumsE) customer complaint sitesAnswer: BObjective: 3AACSB: Use of ITDifficulty: Easy


12) A ________ is "unpredictable, short-lived, and without social, economic, and political significance." A) fad B) fashion C) trend D) megatrend E) style Answer: AObjective: 4Difficulty: Easy

13) A ________ is a direction or sequence of events that has some momentum and durability; it reveals the shape of the future and can provide strategic direction.A) fad B) fashion C) trend D) megatrend E) style Answer: CObjective: 4Difficulty: Easy

14) A ________ is a "large social, economic, political, and technological change that is slow toform, and once in place, influences us for some time—between seven and ten years, or longer."A) fadB) fashionC) trendD) megatrendE) styleAnswer: DObjective: 4Difficulty: Easy

15) Which of the following is true about trends in worldwide population growth?A) Birthrates are on the rise in developed countries.B) Overall, the world population growth is declining.C) Birthrates are on the rise in developing countries.D) Death rates are rising in developing countries.E) Population growth is highest in developing countries.Answer: EObjective: 4Difficulty: Easy


16) A growing population does not mean growing markets unless ________.A) the people are under a democratic system of governmentB) there is common ownership of all resourcesC) people have sufficient purchasing powerD) there is adequate governmental intervention in the marketE) the government has a budget surplusAnswer: CObjective: 4Difficulty: Moderate

17) Firms find "reverse innovation" advantage by ________.A) introducing a commodity in a developed country and then distributing it globallyB) introducing a commodity in a developing country and then distributing it in other developing countriesC) introducing a commodity in a developing country and then distributing it globallyD) introducing a commodity in a developed country and then distributing it in developing countriesE) introducing a commodity in a developed country and then distributing it in other developed countriesAnswer: CObjective: 4Difficulty: Moderate

18) ________ refer to groups of individuals who are born during the same time period and travel through life together. A) Cohorts B) Populations C) ClansD) Societies E) Ethnic groupsAnswer: AObjective: 4Difficulty: Easy

19) The traditional household consists of ________. A) a husband, wife, and children (and sometimes grandparents)B) a group of related persons living togetherC) two or more families living togetherD) a man and a woman living together (whether married or not)E) related or unrelated persons who share living arrangementsAnswer: AObjective: 4Difficulty: Easy


20) Which of the following is likely to occur during economic downturns?A) People tend to spend more on luxury goodsB) Consumption of necessary goods declineC) Long term credit is available at concessional rates of interestD) The purchasing power of the people declinesE) The level of investment in the economy risesAnswer: DObjective: 4AACSB: Dynamics of the global economyDifficulty: Moderate

21) Which of the following economies provide limited opportunities to international marketers to develop product sales?A) capitalist economiesB) subsistence economiesC) raw-materials-exporting economiesD) industrializing economiesE) industrialized economiesAnswer: BObjective: 4Difficulty: Easy

22) Which of the following elements of sociocultural environment can be associated with the growing demand for "social surrogates" like social networking sites, television, etc?A) views of ourselvesB) views of organizationsC) views of othersD) views of natureE) views of the universeAnswer: CObjective: 4Difficulty: Moderate

23) Today, corporations need to make sure that they are good corporate citizens and that their consumer messages are honest in order to positively align themselves with consumers' ________. A) views of others B) views of organizations C) views of themselves D) views of the universe E) views of society Answer: BObjective: 4AACSB: Reflective thinkingDifficulty: Moderate


24) People vary in their views of society and their consumption patterns often reflect their social attitudes. ________ usually live more frugally, drive smaller cars, and wear simpler clothing. A) Makers B) Escapers C) Seekers D) Changers E) Developers Answer: DObjective: 4Difficulty: Moderate

25) People vary in their views of society and their consumption patterns often reflect their social attitudes. ________ usually eat, dress, and live well.A) Makers B) Escapers C) Seekers D) Changers E) Developers Answer: AObjective: 4Difficulty: Moderate

26) ________ beliefs and values are passed from parents to children and reinforced by social institutions—schools, churches, businesses, and governments; they are very difficult to change.A) TransientB) SecondaryC) ProtectedD) CoreE) VariableAnswer: DObjective: 4Difficulty: Moderate

27) Which of the following would be the best illustration of a secondary belief or value? A) belief in work B) belief in giving to charity C) belief in getting married D) belief in getting married early E) belief in being honest Answer: DObjective: 4Difficulty: Moderate


28) Each society contains ________, groups with shared values emerging from their special life experiences or circumstances. A) stakeholdersB) cliques C) consumer bundles D) subcultures E) behavioral niches Answer: DObjective: 4Difficulty: Easy

29) Prestige LLC, a small company that manufactures specialty cereals and energy bars, wants to launch a "green marketing" program in response to heightened consumer awareness about environmental issues. What should the company do to maximize the program's chances of being successful?A) demonstrate that the products will benefit both customers and the society in the long-termB) emphasize benefits to the consumer rather than environmental benefitsC) focus on the efforts and costs incurred by the company to bring these "green" products to consumersD) engage in "greenwashing" to highlight the environmental benefits of the productE) explain the rules and regulations laid out by governmental agencies to protect the environmentAnswer: AObjective: 4AACSB: Analytic skillsDifficulty: Difficult

30) When a company is said to have engaged in "greenwashing," it means that ________.A) the company has significantly changed its business processes to incorporate a greener, more environmentally friendly philosophyB) the company has moved its production facilities to countries where environmental laws and regulations are less rigorousC) the company has changed its "green" image in order to appeal to a different, usually older, demographicD) the company's products are not nearly as green and environmentally beneficial as its marketing might suggestE) the company has undertaken a campaign to lobby for tougher environmental regulations for the industryAnswer: DObjective: 4Difficulty: Easy


31) Mandatory recycling laws have boosted the recycling industry and launched dozens of new companies making new products from recycled materials. Which of the following most closely resembles the situation discussed above?A) Government makes reforestation mandatory for lumbering firms leading to a rise in timber production.B) Government restricts industries from purchasing farmland thereby increasing agricultural produce.C) Government subsidizes export of beef to promote production of beef cattle.D) Government pollution control norms increase the production of pollution control equipment.E) Government restricts unfair trade practices to promote international trade.Answer: DObjective: 4AACSB: Analytic skillsDifficulty: Difficult

32) An unintended effect of business legislation is ________. A) restricting fair competition in the marketB) encouraging unbridled business behaviorC) reducing the social cost of producing a particular commodity D) exposing consumers to unfair trade practicesE) slowing economic growth Answer: EObjective: 4Difficulty: Moderate

33) An important force affecting business is the ________ movement, a movement of citizens and government organized to strengthen the rights and powers of buyers in relation to sellers. A) human rightsB) consumerist C) environmental D) self-determinationE) materialisticAnswer: BObjective: 4Difficulty: Easy

34) Companies can prepare as many as ________ different types of demand estimates.A) 6B) 30C) 60D) 90E) 150Answer: DObjective: 5Difficulty: Easy


35) The demand estimates of an organization comprise of five space levels. They are world, country, region, territory, and ________.A) zoneB) organizationC) customerD) productE) inputAnswer: CObjective: 5Difficulty: Easy

36) The ________ market is the set of consumers with an adequate interest, income, and access to a particular offer. A) potential B) available C) target D) penetrated E) reserve Answer: BObjective: 5Difficulty: Easy

37) The ________ market is the part of the qualified available market the company decides to pursue.A) potential B) available C) target D) penetrated E) reserve Answer: CObjective: 5Difficulty: Easy

38) When the government of any country restricts the sale of a particular commodity to certain groups—for example, restricting sales of alcohol to individuals above the age of 21—the eligible consumers who have income, interest, access and qualification constitute the ________.A) accessible marketB) target marketC) potential marketD) qualified potential marketE) qualified available marketAnswer: EObjective: 5Difficulty: Easy


39) Debbie would like to own a Mercedes but is unable to afford one at this time. Debbie is part of the ________ for this product. A) potential market B) available market C) target market D) projected market E) penetrated market Answer: AObjective: 5AACSB: Analytic skillsDifficulty: Moderate

40) ________ for a product is the total volume that would be bought by a defined customer group in a defined geographical area in a defined time period in a defined marketing environment under a defined marketing program.A) Company demandB) Area market potentialC) Market demandD) Company sales potentialE) Total market potentialAnswer: CObjective: 5Difficulty: Easy

41) With an increase in marketing expenditure, market demand ________.A) continues to increase at an increasing rateB) initially increases and then declinesC) increases first at an increasing rate, then at a decreasing rateD) decreases first and then spikes E) continues to increase at a decreasing rate.Answer: CObjective: 5Difficulty: Moderate

42) The base sales of an organization that takes place even without any demand-stimulating expenditures is called ________.A) primary demandB) market potentialC) market minimumD) optimum demandE) market demandAnswer: CObjective: 5Difficulty: Easy


43) The distance between the market minimum and the market potential shows the overall ________.A) marketing sensitivity of demandB) market share of the firmC) market forecast of the firmD) product-penetration percentageE) sales quotaAnswer: AObjective: 5Difficulty: Easy

44) A low market-penetration index indicates ________.A) it will be expensive for the firms to attract the few remaining prospectsB) substantial growth potential for all firmsC) the rival firms try to capture greater market share by lowering their product priceD) the profit margins of the firms declineE) the firms cannot raise demand substantially by raising its market expenditure Answer: BObjective: 5Difficulty: Moderate

45) Only one level of industry marketing expenditure will actually occur. The market demand corresponding to this level is called the ________.A) market minimumB) market shareC) market forecastD) market potentialE) company demandAnswer: CObjective: 5Difficulty: Easy

46) A company can expect to expand its market share to a large extent when ________.A) it has a high market-penetration indexB) its share-penetration index is lowC) its share-penetration index is highD) its product-penetration percentage is highE) it has a low market potentialAnswer: BObjective: 5Difficulty: Moderate


47) During recession, the market demand curve which is a function of marketing expenditure ________.A) shifts upwardB) becomes verticalC) remains unaffectedD) shifts downwardE) slopes downwardAnswer: DObjective: 5AACSB: Dynamics of the global economyDifficulty: Difficult

48) The sales goal set for a product line, company division, or sales representative of an organization is called ________.A) sales budgetB) company sales forecastC) sales quotaD) company sales potentialE) market potentialAnswer: CObjective: 5Difficulty: Easy

49) A ________ is a conservative estimate of the expected volume of sales, primarily for makingcurrent purchasing, production, and cash flow decisions.A) sales budgetB) company sales forecastC) sales quotaD) company sales potentialE) market potentialAnswer: AObjective: 5Difficulty: Easy

50) ________ is the limit approached by market demand as industry marketing expenditures approach infinity for a given marketing environment.A) Sales budgetB) Company sales forecastC) Sales quotaD) Company sales potentialE) Market potentialAnswer: EObjective: 5Difficulty: Easy


51) ________ is the sales limit approached by company demand as company marketing effort increases relative to that of competitors.A) Sales budgetB) Market demandC) Company demandD) Company sales potentialE) Market potentialAnswer: DObjective: 5Difficulty: Easy

52) A company's sales potential would be equal to market potential if ________.A) the marketing expenditure of the company is reduced to zeroB) industry marketing expenditures approach infinity for a given marketing environmentC) the market is non-expandableD) market minimum is equal to market potentialE) the company gets 100 percent share of the marketAnswer: EObjective: 5Difficulty: Moderate

53) ________ is the maximum sales available to all firms in an industry during a given period, under a given level of industry marketing effort and environmental conditions.A) Company demandB) Market demandC) Company sales potentialD) Sales quotaE) Total market potentialAnswer: EObjective: 5Difficulty: Easy

54) The ________ method of determining area market potential calls for identifying all the potential buyers in each market and estimating their potential purchases.A) group-discussionB) market-testC) market-buildupD) brand development indexE) multiple-factor indexAnswer: CObjective: 5Difficulty: Easy


55) Which of the following organizations is likely to use the multiple-factor index method to estimate the market potential?A) a firm that manufactures auto partsB) a firm that provides facility management services to large officesC) a company that provides Web site development services for small businessesD) a company that manufactures diagnostic machines for hospitalsE) a firm that manufactures fashionable clothes for teenagersAnswer: EObjective: 5AACSB: Analytic skillsDifficulty: Moderate

56) Which of the following is true of the various elements of the multi-factor index method of estimating area market potentials?A) Zip+4 code centers generally have stable boundaries and a population of about 4000.B) The weights in the buying-power index are somewhat arbitrary.C) Normally, the lower the BDI, the less room there is to grow the brand.D) Census tracts are a little larger than neighborhoods. E) This method is primarily used by business marketers.Answer: BObjective: 5Difficulty: Easy

57) Suppose Concrete Express, a cement manufacturing firm, finds that its sales have increased by 3 percent this year, while industry sales have increased by 5 percent. This implies that ________.A) Concrete Express has acquired additional market share in relation to the cement industryB) Concrete Express is losing its relative standing in the cement industryC) other players in the industry are losing market shareD) the absolute market share of Concrete Express has declinedE) Concrete Express's position in relation to the industry has remain unchangedAnswer: BObjective: 5AACSB: Analytic skillsDifficulty: Moderate

58) For which of the following categories of products will demand forecasting be easiest?A) commodities which are in the initial stage of their product life cyclesB) products which have many close substitutes in the marketC) goods which are produced in an oligopoly marketD) products whose sales fluctuate widelyE) products whose consumers are highly sensitive to change in price Answer: CObjective: 5Difficulty: Moderate


59) Novamalt Inc., a manufacturer of health drinks, plans to introduce its new range of woman health drinks into the market. It involves a specialized marketing research firm to forecast the sales of this product. The research firm analyzes past buying behavior of customers and uses time-series analysis for making the sales forecasts. Which of the following information bases is being used by the research firm in this scenario?A) what people sayB) what people do C) what people have doneD) what people will doE) what people speculateAnswer: CObjective: 5AACSB: Analytic skillsDifficulty: Moderate

60) Time series analysis method of forecasting sales breaks past time series into four components- trend, cycle, seasonal, and ________.A) regularB) annualC) erraticD) recurringE) periodicAnswer: CObjective: 5Difficulty: Easy

61) ________ projects the next period's sales by combining an average of past sales and the most recent sales, giving more weight to the latter.A) Timeseries analysisB) Statistical demand analysisC) Econometric analysisD) Cost effectiveness analysisE) Exponential smoothingAnswer: EObjective: 5Difficulty: Easy

62) ________ measures the impact of a set of causal factors (such as income, marketing expenditures, and price) on the sales level.A) Timeseries analysisB) Statistical demand analysisC) Econometric analysisD) Cost effectiveness analysisE) Exponential smoothingAnswer: BObjective: 5Difficulty: Easy


63) The sales forecasting method of ________ builds sets of equations that describe a system and statistically derives the different parameters that make up the equations statistically.A) timeseries analysisB) statistical demand analysisC) econometric analysisD) cost effectiveness analysisE) exponential smoothingAnswer: CObjective: 5Difficulty: Easy

64) ________ provide diagnostic information about how and why we observe certain effects in the marketplace, and what that means to marketers. A) Marketing insights B) Marketing metrics C) Marketing channelsD) Marketing information systemsE) Marketing-mix models Answer: AObjective: 6Difficulty: Easy

65) ________ is the systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing the company. A) Marketing communicationsB) Internal marketingC) Marketing research D) Market segmentationE) Marketing planningAnswer: CObjective: 6Difficulty: Easy

66) Which of the following types of marketing research firms gathers consumer and trade information and then sells it for a fee (e.g., Nielsen Media Research)? A) custom marketing research firmsB) syndicated-service research firmsC) specialty-line marketing research firmsD) generic marketing research firmsE) focused marketing research firmsAnswer: B Objective: 6Difficulty: Easy


67) Amity Inc., is a firm which collects and processes household data and sells it to other firms which produce consumer durables. Amity is an example of a ________.A) custom marketing research firmB) specialty-line marketing research firmC) syndicated-service research firmD) generic marketing research firmE) focused marketing research firmAnswer: C Objective: 6AACSB: Analytic skillsDifficulty: Moderate

68) A field-service firm is a ________. A) custom marketing research firm B) syndicated-service research firm C) specialty-line marketing research firm D) consumer marketing research firm E) social marketing research firm Answer: C Objective: 6Difficulty: Moderate

69) You are the marketing research director of a medium-sized manufacturing firm and you would like to engage an outside marketing research firm to conduct field interviews. Which of the following options categories of marketing research firms should you use?A) syndicated-service research firmsB) custom marketing research firmsC) global research management firmsD) specialty-line marketing research firmsE) brand management specialty research firmsAnswer: D Objective: 6AACSB: Analytic skillsDifficulty: Moderate

70) The marketing research process begins by ________. A) developing a research plan B) defining the problem, the decision alternatives, and research objectives C) analyzing the internal environment D) reading marketing research journals E) contacting a professional research consultant Answer: B Objective: 6Difficulty: Easy


71) Which of the following is considered to be the last step in the marketing research process? A) presenting findingsB) analyzing informationC) controlling the environment D) arriving at a decision E) drafting the report Answer: D Objective: 6Difficulty: Easy

72) If the goal of marketing research is to shed light on the real nature of a problem and to suggest possible solutions or new ideas, the research is said to be ________.A) descriptiveB) quantitativeC) primary D) secondaryE) exploratoryAnswer: EObjective: 6Difficulty: Easy

73) A company would like to study the impact of advertising expenditure on sales and sales revenue. This is an example of ________ research.A) prescriptiveB) causalC) secondaryD) exploratoryE) qualitativeAnswer: BObjective: 6AACSB: Analytic skillsDifficulty: Moderate

74) The marketing manager needs to know the cost of the research project before approving it. During which stage of the marketing research process would such a consideration most likely take place?A) Step 1 defining the problem B) Step 4 analyzing the information C) Step 5 drafting the report D) Step 2 developing the research plan E) Step 3 collecting information Answer: D Objective: 6Difficulty: Moderate


75) Designing a research plan calls for decisions on all of the following EXCEPT ________. A) research objectives B) data sources C) research approaches D) research instruments E) sampling plans Answer: A Objective: 6Difficulty: Easy

76) ________ are data that were collected for another purpose and already exist. A) Primary data B) Secondary data C) Primitive data D) Cross-sectional data E) Ordinate data Answer: B Objective: 6Difficulty: Easy

77) Primary data can be collected in several ways. Installing CCTV cameras in a retail store whereby consumers' actions can be recorded is an example of ________.A) focus group researchB) survey researchC) observational researchD) behavioral researchE) experimental researchAnswer: C Objective: 6AACSB: Analytic skillsDifficulty: Moderate

78) ________ approach uses concepts and tools from anthropology and other social science disciplines to provide deep cultural understanding of how people live and work.A) Cognitive researchB) Inductive researchC) Archaeological researchD) Ethnographic researchE) Deductive researchAnswer: D Objective: 6Difficulty: Easy


79) The goal of ethnographic research is to ________.A) capture cause-and-effect relationships by eliminating competing explanations of the observed findingsB) understand consumers' behavior by observing a sample groups discussing various topics of interest at lengthC) study demographic variables such as age, gender, income, education, and so on, in relation to consumer buying patternsD) analyze customers' purchasing behavior through catalog purchases and customer databasesE) immerse the researcher into consumers' lives to uncover unarticulated desires that might not surface in any other form of researchAnswer: E Objective: 6Difficulty: Moderate

80) A(n) ________ is a gathering of 6 to 10 people carefully selected by researchers based on certain demographic, psychographic, or other considerations and brought together to discuss various topics of interest at length.A) target groupB) pilot groupC) focus groupD) customer baseE) ethnographic groupAnswer: C Objective: 6Difficulty: Easy

81) As the marketing manager of Cominform Pvt. Ltd., a manufacturer of health drinks, you have selected 10 individuals who match the profile of your target customer, to participate in a discussion on changing lifestyle trends related to health. You have also hired a skilled moderator to facilitate the discussion and ensure that everyone participates and stays focused on the topic. The moderator provides questions and probes based on the "script" prepared by you. The discussions are also recorded for further analysis. Which of the following methods of acquiring primary data is being used in this case?A) observational researchB) surveysC) behavioral dataD) experimentsE) focus groupsAnswer: E Objective: 6AACSB: Analytic skillsDifficulty: Moderate


82) Why must the researchers avoid generalizing from focus-group participants to the whole market?A) Participants' responses are not reliable.B) Most of the participants are likely to be ignorant about the topic of discussion.C) The size of the group is too small and the sample is not drawn randomly.D) Most of the participants are likely to exhibit similar tastes and preferences.E) The participants usually come from diverse backgrounds.Answer: C Objective: 6Difficulty: Moderate

83) Which of the following is used to assess people's knowledge, beliefs, preferences, and satisfaction and to measure these magnitudes in the general population?A) observational researchB) descriptive researchC) quantitative researchD) survey researchE) experimental researchAnswer: D Objective: 6Difficulty: Easy

84) The most scientifically valid research is ________ research. A) observation B) focus-group C) survey D) behavioral E) experimental Answer: E Objective: 6Difficulty: Easy

85) ________ is designed to capture cause-and-effect relationships by eliminating competing explanations of the observed findings.A) Experimental researchB) Behavioral researchC) Observational researchD) Focus group researchE) Descriptive researchAnswer: A Objective: 6Difficulty: Easy


86) Which of the following rules must be kept in mind while framing a questionnaire?A) Use broad and loosely defined words in the questions.B) Avoid using response bands.C) Ensure that fixed responses overlap.D) Frame hypothetical questions.E) Allow for the answer "other" in fixed-response questions.Answer: E Objective: 6Difficulty: Moderate

87) Because of its flexibility, ________ are the most common technique of collecting primary data.A) questionnairesB) telephonic interviewsC) behavioral research studiesD) experimental designsE) focus groupsAnswer: A Objective: 6Difficulty: Easy

88) ________ allow respondents to answer in their own words and often reveal more about how people think. A) Open-end questionsB) Dichotomous questionsC) Likert scale questionsD) Multiple choice questionsE) Semantic differential questionsAnswer: A Objective: 6Difficulty: Easy

89) Which of the following is true of qualitative research?A) It is a structured measurement approach that permits a range of possible responses.B) It is indirect in nature, so consumers may be less guarded.C) It requires large sample sizes.D) Its results can be easily generalized to broader populations.E) It generally results in similar results and conclusions across researchers.Answer: B Objective: 6Difficulty: Moderate


90) A scale that connects two bipolar words is called a ________.A) dichotomous question B) multiple-choice question C) Likert scale D) semantic differential E) word associationAnswer: D Objective: 6Difficulty: Moderate

91) A question that respondents can answer in an almost unlimited number of ways is called a ________.A) structured questionB) closed-end questionC) completely unstructured question D) dichotomous questionE) multiple choice questionAnswer: C Objective: 6Difficulty: Easy

92) An item in a questionnaire states that "most politicians cannot be trusted." Respondents are required to provide their answers by choosing any one of the following options: 1) Strongly disagree, 2) Disagree, 3) Neither agree nor disagree, 4) Agree, 5) Strongly agree. This is an example of a ________.A) semantic differential B) word association questionC) Thematic Appreciation Test (TAT) D) Likert scale E) dichotomous question Answer: D Objective: 6AACSB: Analytic skillsDifficulty: Moderate

93) If a marketing researcher chooses to use word associations, the researcher is using ________.A) closed-end questionsB) Likert scale questionsC) open-end questionsD) rating scale questionsE) semantic differential questionsAnswer: C Objective: 6Difficulty: Moderate


94) In which of the following types of tests is a picture presented and respondents are asked to make up a story about what they think is happening or may happen in the picture? A) visual perception testB) Rorschach Ink-blot TestC) story completion testD) Thematic Apperception Test E) Renfrew Action Picture Test Answer: D Objective: 6Difficulty: Moderate

95) The question "What is your opinion of the measures taken by the government to control inflation?" is an example of a ________ question. A) semantic differential B) word association C) completely unstructured D) story completion E) dichotomousAnswer: C Objective: 6AACSB: Analytic skillsDifficulty: Moderate

96) In which of the following qualitative method are subjects asked to complete an incomplete stimulus?A) word association B) projective techniquesC) visualization D) brand personification E) laddering Answer: B Objective: 6Difficulty: Moderate

97) ________ requires people to create a collage from magazine photos or drawings to depict their perceptions.A) Brand personificationB) Projective techniqueC) VisualizationD) LadderingE) Metaphor Elicitation TechniqueAnswer: C Objective: 6Difficulty: Moderate


98) The primary purpose of ________ is to identify the range of possible brand associations in consumers' minds.A) experimental researchB) dashboardingC) ladderingD) semantic differentialsE) word associationsAnswer: E Objective: 6Difficulty: Easy

99) With respect to the sampling plan, three decisions must be made: (1) the sampling unit—who is to be surveyed; (2) sample size—how many people should be surveyed; and (3) ________. A) sample cost—how much does sampling costB) surveyor skill—who should conduct the surveyC) sample security—how should the sample data be protectedD) sampling procedure—how should respondents be chosenE) sample supervisor—who leads the sampling effort Answer: D Objective: 6Difficulty: Moderate

100) According to the concept of ________, a series of increasingly more specific "why" questions can reveal consumer motivation and consumers' deeper, more abstract goals.A) word associationB) projectionC) visualizingD) brand personificationE) ladderingAnswer: E Objective: 6Difficulty: Easy

101) ________ measure the interest or emotions aroused by exposure to a specific ad or picture. A) TachistoscopesB) PolygraphsC) GalvanometersD) AudiometersE) GPS systemsAnswer: C Objective: 6Difficulty: Easy


102) ________ flash an ad to a subject with an exposure interval that may range from less than one hundredth of a second to several seconds. A) TachistoscopesB) AudiometersC) PolygraphsD) GPS systemsE) GalvanometersAnswer: A Objective: 6Difficulty: Easy

103) ________ attached to television sets in participating homes now record when the set is on and to which channel it is tuned.A) TachistoscopesB) PolygraphsC) GPS systemsD) AudiometersE) GalvanometersAnswer: D Objective: 6Difficulty: Easy

104) Which of the following statements about telephonic interview is true?A) It usually takes a long time to gather information through telephonic interviews.B) The interviewer is unable to clarify questions if respondents do not understand them.C) The response rate for telephonic interviews has been typically lower than for mailed questionnaires.D) The U.S. government generally encourages telemarketing by firms.E) Telephone interviewing in the U.S. is getting more difficult because of consumers' growing antipathy toward telemarketers.Answer: E Objective: 6Difficulty: Moderate

105) If a marketing researcher wishes to reach those people who would not give personal interviews or whose responses might be biased or distorted by interviewers, he or she should use ________.A) mail questionnairesB) telephonic interviewsC) online interviews D) focus groupsE) observational researchAnswer: A Objective: 6Difficulty: Easy


106) Which of the following is considered to be the most versatile of all the contact methods?A) mail questionnaires B) telephone interviewsC) personal interviewsD) online interviewsE) field trialsAnswer: C Objective: 6Difficulty: Easy

107) In ________ interviews, researchers stop people at a shopping mall or busy street corner and request an interview on the spot. A) interceptB) arrangedC) groupD) structuredE) behavioralAnswer: A Objective: 6Difficulty: Easy

108) Which of the following is an advantage of personal interviews?A) It is a relatively inexpensive method of gathering information.B) The possibility of interviewer bias is minimized. C) Participants can choose to respond at their own convenience.D) It facilitates anonymous responses.E) Interviewers can record additional observation about the respondent such as body language.Answer: E Objective: 6Difficulty: Moderate

109) Which of the following is one of the key disadvantages of online market research? A) Online research is expensive. B) Online research is time consuming. C) People tend to be dishonest online. D) Online research lacks versatility. E) Samples can be small and skewed. Answer: E Objective: 6Difficulty: Easy


110) Which of the following is an advantage of online research?A) Samples are generally representative of the target population.B) Members of online panels and communities tend to have low turnover.C) Online research is relatively free of technological problems and inconsistencies.D) People tend to be honest and thoughtful online.E) Online research is slow but gather detailed information.Answer: D Objective: 6Difficulty: Moderate

111) The ________ phase of marketing research is generally the most expensive and the most prone to error. A) contactB) research planning C) questionnaire design D) interview design E) data collection Answer: E Objective: 6Difficulty: Easy

112) After collecting the relevant information, the next step in the marketing research process is to ________.A) develop the research planB) define the problem and research objectivesC) present the project reportD) make the final decisionE) analyze the acquired data Answer: E Objective: 6Difficulty: Moderate

113) After computing averages and measures of dispersion for the major variables and applying advanced statistical techniques and decision models in the hope of discovering additional findings from the gathered information, the researchers ________.A) define the problem, the decision alternatives, and the research objectivesB) present findings relevant to the major marketing decisions facing managementC) evaluate the costs associated with data collectedD) analyze the appropriateness of the data sources usedE) develop the research planAnswer: B Objective: 6Difficulty: Moderate


114) Why do firms employ more than one persona to gather information about the target consumers?A) Within a group, consumers usually exhibit similar tastes and preferences.B) The distribution of income and wealth are more or less equal across different customer segments.C) Although customers have uniques, essentially their basic needs and requirements are the same.D) Any target market may have a range of consumers who vary along a number of key dimensions.E) The firms want to provide consumers with a greater number of product choices.Answer: D Objective: 6Difficulty: Moderate

115) A ________ has been defined as a coordinated collection of data, systems, tools, and techniques with supporting software and hardware by which an organization gathers and interprets relevant information from business and environment and turns it into a basis for marketing action. A) marketing metricB) marketing channel system C) marketing decision support system D) marketing research system E) database management system Answer: C Objective: 6Difficulty: Easy

116) All of the following are considered to be among the seven characteristics of good marketing research EXCEPT ________. A) the scientific method B) research creativity C) multiple methods D) ethical marketing E) independence of models and data Answer: E Objective: 6Difficulty: Moderate


117) ________ are a structured way to disseminate the insights gleaned from the two complementary approaches to measuring marketing productivity within the organization.A) Marketing metricsB) Marketing decision support systemsC) Marketing dashboardsD) Marketing segmentsE) Marketing mix modelsAnswer: C Objective: 7Difficulty: Easy

118) Two complimentary approaches to measure marketing productivity are ________ and marketing-mix modeling. A) quality ratios B) salesperson satisfaction ratesC) marketing metricsD) retailer satisfaction indicesE) customer feedback surveysAnswer: C Objective: 7Difficulty: Easy

119) Which of the following refers to the set of measures that help firms to quantify, compare, and interpret their marketing performance? A) marketing diagnostics B) marketing information systemsC) marketing simulationD) marketing intelligence E) marketing metrics Answer: E Objective: 7Difficulty: Easy

120) Which of the following is an external marketing metric that companies need to monitor? A) resource adequacyB) staffing or skill levels C) active innovation support D) market shareE) relative employee satisfaction Answer: D Objective: 7Difficulty: Moderate


121) Which of the following is an internal marketing metric that companies need to monitor?A) market shareB) consumer satisfactionC) relative perceived qualityD) total number of customersE) relative employee satisfactionAnswer: E Objective: 7Difficulty: Moderate

122) ________ analyze(s) data from a variety of sources, such as retailer scanner data, company shipment data, pricing, media, and promotion spending data, to understand more precisely the effects of specific marketing activities.A) Marketing metricsB) Marketing-mix modelsC) Marketing forecastingD) Marketing intelligence databasesE) Marketing decision systemsAnswer: BObjective: 8Difficulty: Easy

123) When the marketers of a mobile phone manufacturing company want to determine the impact of individual media such as television and online display ads on sales as well as that of trade activities like every day low price, off-shelf display and so on, they usually use ________.A) marketing metricsB) market segmentation strategiesC) market capitalization techniquesD) market basket analysisE) marketing-mix modelsAnswer: EObjective: 8AACSB: Analytic skillsDifficulty: Difficult

124) A ________ records how well the company is doing year after year based on measures such as the average perception of the company's product quality relative to its chief competitor.A) customer-performance scorecard B) stakeholder-performance scorecard C) marketing balanced scorecard D) vendor scorecard E) generic scorecard Answer: AObjective: 8Difficulty: Easy


125) If a company actively tracks the satisfaction of its suppliers, banks, and distributors, it is using what is called a ________. A) customer-performance scorecard B) stakeholder-performance scorecard C) marketing balanced scorecard D) vendor scorecard E) generic scorecard Answer: BObjective: 8Difficulty: Easy

126) Marketers have little information about how consumption patterns vary across and within countries.Answer: FALSEObjective: 1Difficulty: Easy

127) Companies with superior information enjoy a competitive advantage. Answer: TRUEObjective: 1Difficulty: Easy

128) Many firms use the Internet and extranets to improve the speed, accuracy, and efficiency of the order-to-payment cycle.Answer: TRUEObjective: 2Difficulty: Easy

129) Few consumers actually delete cookies frequently. When customers do not delete cookies, they expect customized marketing appeals and deals. Answer: TRUEObjective: 2Difficulty: Moderate

130) Mailing of a new offer to a handful of selected customers instead of all customers reduces the response rate to the offer. Answer: FALSEObjective: 2Difficulty: Moderate

131) Competitive intelligence gathering is inherently illegal and unethical. Answer: FALSEObjective: 3Difficulty: Easy


132) If a company were pursuing a policy of networking externally to gather marketing intelligence, it might collect competitors' ads or look up news stories about competitors. Answer: TRUEObjective: 3Difficulty: Easy

133) One of the ways to find relevant online information on competitors' strengths and weaknesses might be to frequent distributor or sales agent feedback sites. Answer: TRUEObjective: 3Difficulty: Easy

134) The competitive intelligence function works best when it is closely coordinated with the decision-making process. Answer: TRUEObjective: 3Difficulty: Easy

135) A fad is more predictable and durable than a trend.Answer: FALSEObjective: 3Difficulty: Easy

136) A new market opportunity generally guarantees success, if the new product is technically feasible.Answer: FALSEObjective: 4Difficulty: Moderate

137) Demographic developments are often unpredictable. Answer: FALSEObjective: 4Difficulty: Easy

138) Population growth is highest in countries and communities that can least afford it. Answer: TRUEObjective: 4Difficulty: Easy

139) There is a global trend toward an aging population.Answer: TRUEObjective: 4Difficulty: Easy


140) The basis of cohort segmentation is that the experiences of key defining moments during the time when an individual becomes an adult can influence his or her values, preferences, and buying behaviors for the rest of his or her life.Answer: TRUEObjective: 4Difficulty: Easy

141) Marketing strategies of firms should not consider the ethnic and racial diversity existing in their markets.Answer: FALSEObjective: 4Difficulty: Easy

142) Consumers belonging to the same ethnic group have identical tastes and preferences. Answer: FALSEObjective: 4Difficulty: Easy

143) Of all illiterate adults in the world, two-thirds are women. Answer: TRUEObjective: 4Difficulty: Easy

144) Households comprising of single, separated, widowed, and divorced individuals generally demand larger apartments, and expensive appliances, furniture, and furnishings.Answer: FALSEObjective: 4Difficulty: Easy

145) The available purchasing power in an economy depends on current income, prices, savings, debt, and credit availability. Answer: TRUEObjective: 4Difficulty: Easy

146) Industrial economies provide limited marketing opportunities for luxurious goods.Answer: FALSEObjective: 4Difficulty: Easy

147) Markets with a segment of very wealthy consumers, but high income disparity, present few opportunities to marketers. Answer: FALSEObjective: 4Difficulty: Moderate


148) Business has responded to increased awareness of nature's fragility and finiteness by producing wider varieties of camping, hiking, boating, and fishing gear such as boots, tents, backpacks, and accessories. Answer: TRUEObjective: 4Difficulty: Easy

149) Secondary beliefs and values are passed on from parents to children and reinforced by major social institutions, making them very difficult to change by marketers.Answer: FALSEObjective: 4Difficulty: Moderate

150) Environmental regulations enforced by the government adversely affect automobile and steel manufacturing companies.Answer: TRUEObjective: 4Difficulty: Easy

151) Corporate environmentalism recognizes the need to integrate environmental issues into the firm's strategic plans.Answer: TRUEObjective: 4Difficulty: Easy

152) Firms that can develop substitute materials for finite nonrenewable resources have an excellent opportunity.Answer: TRUEObjective: 4Difficulty: Easy

153) The time between introduction of products and peak production is shrinking.Answer: TRUEObjective: 4Difficulty: Easy

154) A growing portion of U.S. R&D expenditures goes to the development as opposed to the research side.Answer: TRUEObjective: 4Difficulty: Easy

155) Regulation of technological changes has been relaxed by the U.S. government over recent years. Answer: FALSEObjective: 4Difficulty: Easy


156) Environmental laws imposed by the government may at times create new business opportunities.Answer: TRUEObjective: 4Difficulty: Easy

157) Demand estimates prepared by companies are based on four different time periods.Answer: FALSEObjective: 5Difficulty: Easy

158) The penetrated market is the set of consumers who have an interest in a market offer but do not have the accessibility.Answer: FALSEObjective: 5Difficulty: Easy

159) Market demand for a product is the total volume that would be bought by a defined customer group in a defined geographical area in a defined time period in a defined marketing environment under a defined marketing program.Answer: TRUEObjective: 5Difficulty: Easy

160) An expansible market is unlikely to be affected by the level of industry marketing expenditures.Answer: FALSEObjective: 5Difficulty: Easy

161) The market forecast shows expected market demand, not maximum market demand.Answer: TRUEObjective: 5Difficulty: Easy

162) Companies assume that the lower the product-penetration percentage, the lower will be the market potential.Answer: FALSEObjective: 5Difficulty: Moderate

163) In order to estimate future demand, companies commonly prepare a company sales forecast first, followed by an industry forecast, and finally a macroeconomic forecast.Answer: FALSEObjective: 5Difficulty: Moderate


164) Forecasting is the art of anticipating what buyers are likely to do under a given set of conditions.Answer: TRUEObjective: 5Difficulty: Easy

165) Sales reps might have better insight into developing trends than any other group, and forecasting might give them greater confidence in their sales quotas and more incentive to achieve them.Answer: TRUEObjective: 5Difficulty: Moderate

166) Good marketing insights often form the basis of successful marketing programs.Answer: TRUE Objective: 6Difficulty: Easy

167) Most large companies prefer to use external marketing research consultants rather than employ their own marketing research department. Answer: FALSE Objective: 6Difficulty: Easy

168) When the companies engage students to design and carry out projects, the payoff to the students is experience and visibility; the payoff to the companies is a fresh sets of eyes to solve problems at a fraction of what consultants would charge.Answer: TRUE Objective: 6Difficulty: Easy

169) Custom marketing research firms sell field interviewing services to other firms. Answer: FALSE Objective: 6Difficulty: Easy

170) After developing the research plan, the marketing researcher should define the problem and research objectives. Answer: FALSE Objective: 6Difficulty: Easy

171) The goal of exploratory research is to shed light on the real nature of the problem and to suggest possible solutions or new ideas.Answer: TRUE Objective: 6Difficulty: Easy


172) The purpose of causal research is to test a cause-and-effect relationship.Answer: TRUE Objective: 6Difficulty: Easy

173) Secondary data are data freshly gathered for a specific purpose or for a specific research project.Answer: FALSE Objective: 6Difficulty: Easy

174) The goal of ethnographic research is to immerse the researcher into consumers' lives to uncover unarticulated desires that might not surface in any other form of research.Answer: TRUE Objective: 6Difficulty: Easy

174) Researchers should generalize findings from focus-group participants to the whole market. Answer: FALSE Objective: 6Difficulty: Moderate

175) Keeping a survey short and simple and contacting customers no more than once a month are two keys to drawing people into the data collection effort.Answer: TRUE Objective: 6Difficulty: Easy

176) A good example of collecting behavioral data would be when a store uses scanners to read bar codes on products selected by consumers. Answer: TRUE Objective: 6AACSB: Analytic skillsDifficulty: Moderate

177) Experiments call for selecting matched groups of subjects, subjecting them to different treatments, controlling extraneous variables, and checking whether observed response differences are statistically significant.Answer: TRUE Objective: 6Difficulty: Easy

178) Owing to its greater flexibility, a questionnaire is by far the most common instrument used to collect primary data.Answer: TRUE Objective: 6Difficulty: Easy


179) Qualitative research techniques are relatively structured measurement approaches that permit limited possible responses.Answer: FALSE Objective: 6Difficulty: Moderate

180) A questionnaire should contain sophisticated and uncommon words.Answer: FALSE Objective: 6Difficulty: Easy

181) If a marketing researcher decides to use a Likert scale, the researcher has chosen a technique wherein the respondent reviews a statement that shows the amount of agreement/disagreement with some product, service, or concept. Answer: TRUE Objective: 6Difficulty: Moderate

182) A dichotomous question is a question with three or more answers. Answer: FALSE Objective: 6Difficulty: Easy

183) A scale that describes the respondent's intention to buy a particular product is called a rating scale.Answer: FALSE Objective: 6Difficulty: Easy

184) Visualization requires people to create a collage from magazine photos or drawings to depict their perceptions.Answer: TRUE Objective: 6Difficulty: Easy

185) Once they have determined the sampling unit, marketers must develop a sampling frame so that a small section in the target population has a greater chance of being sampled.Answer: FALSE Objective: 6Difficulty: Moderate

186) Samples of less than 1% of a population can often provide good reliability, with a credible sampling procedure. Answer: TRUE Objective: 6Difficulty: Moderate


187) Probability sampling allows confidence limits to be calculated for sampling error and makes the sampling more representative. Answer: TRUE Objective: 6Difficulty: Moderate

188) The response rate is usually very high for mail questionnaires.Answer: FALSE Objective: 6Difficulty: Easy

189) If a marketing researcher is looking for a contact method that can gather information quickly and allow the interviewer to clarify questions if necessary, he or she will choose the telephone interview method. Answer: TRUE Objective: 6Difficulty: Moderate

190) A good illustration of what is called the arranged interview occurs when interviewers stop people in a shopping mall or on a busy street and solicit information necessary to their research effort. Answer: FALSE Objective: 6Difficulty: Moderate

191) Online surveys are fast because the survey can automatically direct respondents to applicable questions and transmit results immediately.Answer: TRUE Objective: 6Difficulty: Easy

192) One of the characteristics of good marketing research is that it uses multiple methods to increase confidence in the results. Answer: TRUE Objective: 6Difficulty: Easy

193) Marketing researchers should have a healthy skepticism toward glib assumptions made by managers about how a market works. Answer: TRUE Objective: 6Difficulty: Easy


194) Marketing expenses and investments as inputs can be quantified only in the long run, whereas the resulting outputs such as broader brand awareness, enhanced brand image, greater customer loyalty, and improved new product prospects manifest themselves in the short run.Answer: FALSE Objective: 7Difficulty: Moderate

195) Marketing-mix modeling is used to estimate causal relationships and measure how marketing activity affects outcomes. Answer: TRUEObjective: 8Difficulty: Moderate

196) Marketing accountability means that marketers must more precisely estimate the effects of different marketing investments.Answer: TRUEObjective: 8Difficulty: Easy

197) Especially popular with such companies as Procter & Gamble, marketing-mix modeling is used to allocate or reallocate expenditures. Answer: TRUEObjective: 8Difficulty: Moderate

198) Marketing-mix modeling focuses on baseline sales or long term effects instead of incremental growth.Answer: FALSEObjective: 8Difficulty: Easy

199) Management can assemble a summary set of relevant internal and external measures in a marketing dashboard for synthesis and interpretation.Answer: TRUEObjective: 8Difficulty: Easy

200) A stakeholder-performance scorecard tracks the satisfaction with the company and its products and services among such entities as suppliers, banks, and stockholders. Answer: TRUEObjective: 8Difficulty: Easy


201) What is a marketing information system (MIS)? From what sources is the MIS developed? Answer: A marketing information system (MIS) consists of people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers. A marketing information system is developed from internal company records, marketing intelligence activities, and marketing research. Objective: 1AACSB: Use of ITDifficulty: Easy

202) What is a marketing intelligence system? How can marketing intelligence data be collected?Answer: A marketing intelligence system is a set of procedures and sources that managers use to obtaineveryday information about developments in the marketing environment. The marketing intelligence system supplies happenings data.Marketing managers collect marketing intelligence in a variety of different ways, such as by reading books, newspapers, and trade publications; talking to customers, suppliers, and distributors; monitoring social media on the Internet; and meeting with other company managers.Objective: 3Difficulty: Moderate

203) What are the various steps a company can take to improve the quality of its marketing intelligence function? Answer: The steps are: (1) a company can train and motivate the sales force to spot and report new developments; (2) a company can motivate distributors, retailers, and other intermediaries to pass along important intelligence; (3) a company can network externally; (4) a company can set up a customer advisory panel; (5) a company can take advantage of government data resources; (6) a company can purchase information from outside suppliers; and (7) a company can use online customer feedback systems to collect competitive intelligence. Objective: 3Difficulty: Moderate

204) List and briefly describe the five main ways in which marketers can find relevant online information on competitors' strengths and weaknesses.Answer: The five ways are: (1) independent customer goods and service review forums; (2) distributor or sales agent feedback sites which are built by the distributors themselves to describe their experience and level of satisfaction on products or services; (3) combo sites offering customer reviews and expert opinions mainly on financial services and high-tech products that require professional knowledge; (4) customer complaint sites designed mainly for dissatisfied customers, which allows customers to express their dissatisfaction in certain firms or products; and (5) public blogs offering personal opinions, reviews, ratings and recommendations on virtually any topic. Objective: 3AACSB: Use of ITDifficulty: Moderate


205) What are the different income-distribution patterns? How does income distribution in the economies affect the marketing decision of the firms?Answer: Marketers often distinguish countries using five income-distribution patterns: (1) very lowincomes; (2) mostly low incomes; (3) very low, very high incomes; (4) low, medium, high incomes; and (5) mostly medium incomes.The market would be very small in countries with type 1 or 2 income patterns and will be considerably large in the countries with income patterns 3 and 4. Countries which have a marked inequality in income distribution the companies tend to produce goods which are consumed by the mass as well as produce certain luxurious goods to cater to the richer section.Objective: 4Difficulty: Moderate

206) Discuss the impact of tougher environmental regulations on businesses, citing examples whenever possible. Also, point out opportunities, if any, presented by these regulations.Answer: Environmental regulations adversely affect certain industries. They increase the cost of production for a range of industries. For instance, steel manufacturing units and firms which generate electricity are required to install pollution control equipments. Automobile companies are required to develop and use cleaner technology in their vehicles. However, businesses can also achieve significant savings in their energy and gas bills by moving to environmentally friendly ways to heat or cool their offices and run their manufacturing facilities. A shift to paper-less communication can cut costs and pollution. Plus, new business opportunities are opening up in the "green" sectors as is evident in the companies that manufacture and sell emission-control equipment and sell services to help companies adopt environmentally-friendly practices.Objective: 4Difficulty: Moderate

207) What does total market potential mean? How can it be estimated?Answer: Total market potential is the maximum sales available to all firms in an industry during a given period, under a given level of industry marketing effort and environmental conditions.A common way to estimate total market potential is to multiply the potential number of buyers by the average quantity each purchases, times the price. A variation on this method is the chain-ratio method, which multiplies a base number by several adjusting percentages.Objective: 5Difficulty: Easy

208) Suppose a cotton-textile company wants to estimate the area market potential for its high quality fabrics in Gujarat. List the possible steps that the marketers will follow to compute the area market potential.Answer: The marketers may follow the following steps: Identify all the potential buyers of textile in the area, primarily the firms manufacturing ready made garments in that area. In order to do that, the company may compile a list from a directory of all manufacturing establishments in the area. Then it can estimate the quantity of fabrics each firm might purchase to produce garments worth $1 million. Compiling the quantity required by each of the firms, the marketers can estimate the area market potential of the fabric produced by the textile company.Objective: 5Difficulty: Moderate


209) Briefly describe the methods of forecasting future demand on the basis of past sales.Answer: The methods are: 1) Time series analysis, that breaks past time series into four components (trend, cycle, seasonal, and erratic) and projects them into the future. 2) Exponential smoothing, that projects the next period's sales by combining an average of past sales and the most recent sales, giving more weight to the latter. 3) Statistical demand analysis, which measures the impact of a set of causal factors (such as income, marketing expenditures, and price) on the sales level. 4) Econometric analysis, builds sets of equations that describe a system and statistically derives the different parameters that make up the equations statistically.Objective: 5Difficulty: Moderate

210) What are the two basic advantages that a company's marketers have in identifying significant changes in the market? Answer: The two advantages are: (1) They have disciplined methods for collecting information; and (2) they spend more time interacting with customers and observing competition. Objective: 1Difficulty: Easy

211) Why is it necessary for firms to execute the steps of the order-to-payment cycle quickly and accurately? Answer: It is necessary for the firms to execute the steps of the order-to-payment cycle quickly and accurately because customers favor firms that can promise timely delivery.Objective: 2Difficulty: Easy

212) List some of the ways in which data mining assists the decision makers of the company.Answer: Data mining enables the analysts to garner fresh insights into neglected customer segments, recent customer trends, and other useful information. Managers can cross-tabulate customer information with product and salesperson information to yield still-deeper insights.Objective: 2Difficulty: Moderate

213) How do the distributors, retailers and other intermediaries help a company to improve the quantity and quality of its marketing intelligence?Answer: Since marketing intermediaries are often closer to the customer, they can offer helpful insights to the company to improve its marketing intelligence system.Objective: 3Difficulty: Easy


214) Suppose Ornate Inc. and Oracle are the only players in digital camera industry. What can Ornate do to acquire marketing intelligence?Answer: Student answers may vary. Ornate Inc. can network externally to find out more about its competitor Oracle. It can purchase Oracle's products, attend open houses and trade shows, read reports published by the rival firm, attend stockholders' meetings, talk to employees, collect competitors' ads, consult with suppliers, and look up news stories about Oracle. Objective: 3Difficulty: Moderate

215) Suppose the people of Greenworld, an island on the southwest Pacific are primarily involved in the direct procurement of edible plants and animals from the wild, foraging and hunting without significant recourse to the domestication of either. On the contrary people in Newland, a country rich in petroleum resources export petroleum to the industrial countries. Which of the two countries mentioned above is likely to offer greater marketing opportunities for luxurious goods and why?Answer: Newland is likely to produce greater marketing opportunities for luxurious goods as people in this country are likely to have greater affordability than the people in Greenworld.Objective: 4AACSB: Analytic skillsDifficulty: Moderate

216) Organix Internationals LLC is planning to introduce its new range of breakfast cereals. List the different product levels that it considers while formulating the demand estimates for the new product.Answer: The six different product levels that Organix needs to consider to formulate the demand estimates for its new range of cereals are all sales, industry sales, company sales, product line sales, product from sales, and product item sales.Objective: 5Difficulty: Difficult

217) If the ratio between current and potential levels of market demand is close to unity, what can you infer about the industry's market-penetration index and the growth potential of the firms in the industry?Answer: The industry has a high market-penetration index and there is a negligible growth potential for all the firms in the industry.Objective: 5Difficulty: Easy

218) How does the marketing environment determine the position of the market demand function?Answer: During economic prosperity the market demand function shifts up as every dollar spent in stimulating demand leads to a greater market demand. Whereas during recession the market demand function shifts downward as an equal increase in marketing expenditure leads to a smaller increase in market demand.Objective: 5Difficulty: Difficult


219) Simpsons, a manufacturer of air conditioners, finds that its sales potential is less than its market potential even when it spends a sufficient amount on advertisements and after sale services. What is the basic reason behind such an observation by the marketers of Simpsons?Answer: Company sales potential is less than the market potential, even when a company's marketing expenditures increase considerably because each firm has a set of loyal consumers unresponsive to other companies' efforts to woo them.Objective: 5AACSB: Analytic skillsDifficulty: Moderate

220) Two major methods of computing area market potential are market build-up method and multiple factor-index method. Which of these methods will Nexus Enterprises, a manufacturer of auto parts implement to estimate its market potential?Answer: Nexus Enterprise will implement market-build up method to estimate its area market potential as this method is primarily used by business marketers such as Nexus.Objective: 5AACSB: Analytic skillsDifficulty: Moderate

221) Discuss the different ways which can be adopted by small manufacturing firms to conduct market research.Answer: The small firms can adopt the following ways to conduct market research:1) They can engage students or professors to design and carry out projects. 2) They can collect considerable information at very little cost by examining competitors' Web sites, monitoring chat rooms, and accessing published data. 3) The owners of small business firms can routinely visit competitors to learn about changes they have made. 4) By tapping into marketing partner expertise. Objective: 6Difficulty: Easy

222) What are the six steps involved in the marketing research process? Answer: The six steps are: (1) define the problem and research objectives, (2) develop the research plan, (3) collect the information, (4) analyze the information, (5) present the findings, and (6) make the decision. Objective: 6Difficulty: Easy


223) List the challenges faced to conduct a good focus group discussion.Answer: There are many challenges to conducting a good focus group. Some researchers believe consumers have been so bombarded with ads, they unconsciously parrot back what they've already heard instead of what they really think. There's always a concern that participants are just trying to maintain their self-image and public persona or have a need to identify with the other members of the group. Participants also may not be willing to acknowledge in public—or may not even recognize—their behavior patterns and motivations. And the "loudmouth or know-it-all" problem often crops up when one highly opinionated person drowns out the rest of the group. Objective: 6Difficulty: Difficult

224) What are the relative advantages of online and in-person focus groups?Answer: An area of increasing interest is online focus groups. These may cost less than a fourth of a traditional, in-person focus group. Online focus groups also offer the advantages of being less intrusive, allowing geographically diverse subjects to participate, and yielding fast results. They are useful at collecting reactions to focused topics such as a specific new product concept.Proponents of in-person focus groups, on the other hand, maintain that in-person focus groups allow marketers to be immersed in the research process, get a close-up look to people's emotional and physical reactions, and ensure that sensitive materials are not leaked. Marketers can also make spontaneous adjustments to the flow of discussion and delve deeply into more complex topics, such as alternative creative concepts for a new ad campaign. Objective: 6Difficulty: Difficult

225) Give an account of experimental research.Answer: Experimental research is designed to capture cause-and-effect relationships by eliminating competing explanations of the observed findings. If the experiment is well designed and executed, research and marketing managers can have confidence in the conclusions. Experiments call for selecting matched groups of subjects, subjecting them to different treatments, controlling extraneous variables, and checking whether observed response differences are statistically significant. Objective: 6Difficulty: Moderate


226) Explain what qualitative research is and why it might be useful to marketers. What are its major drawbacks?Answer: Qualitative research techniques are relatively unstructured measurement approaches to permit a range of possible responses, and they are a creative means of ascertaining consumer perceptions that may otherwise be difficult to uncover. Because of the freedom it affords both researchers in their probes and consumers in their responses, qualitative research can often be an especially useful first step in exploring consumers' brand and product perceptions. It is indirect in nature, so consumers may be less guarded and reveal more about themselves in the process.Qualitative research does have its drawbacks. Marketers must temper the in-depth insights that emerge with the fact that the samples are often very small and may not necessarily generalize to broader populations. And different researchers examining the same qualitative results may draw very different conclusions. Objective: 6AACSB: Reflective thinkingDifficulty: Moderate

227) Give an account of the different technological devices that have been developed to provide insight into the consumers' behavior to the researchers.Answer: There has been much interest in recent years in various technological devices. Galvanometers can measure the interest or emotions aroused by exposure to a specific ad or picture. The tachistoscope flashes an ad to a subject with an exposure interval that may range from less than one hundredth of a second to several seconds. After each exposure, the respondent describes everything he or she recalls. Eye cameras study respondents' eye movements to see where their eyes land first, how long they linger on a given item, and so on. Objective: 6Difficulty: Moderate

228) What is the chief advantage of using each of the following contact methods: mail questionnaire, telephone interview, and personal interview? Answer: The chief advantage of each contact method mentioned is (1) mail questionnaire the best way to reach people who would not give personal interviews or whose responses might be biased or distorted by the interviews, (2) telephone interviews the best method for gathering information quickly and the interviewer is also able to clarify questions if respondents do not understand them, and (3) personal interview the most versatile method because they can ask more questions and record additional observations about the respondent. Objective: 6Difficulty: Moderate

229) Give reasons to justify that online research is versatile.Answer: Increased broadband penetration offers online research even more flexibility and capabilities. For instance, virtual reality software lets visitors inspect 3-D models of products such as cameras, cars, and medical equipment and manipulate product characteristics. Even at the basic tactile level, online surveys can make answering a questionnaire easier and more fun than paper-and-pencil versions. Online community blogs allow customer participants to interact with each other. Objective: 6Difficulty: Moderate


230) What are the major shortcomings of marketing-mix modeling?Answer: The major shortcomings of marketing-mix modeling are- 1) Although marketing-mix modeling helps to isolate effects, it is less effective at assessing how different marketing elements work in combination. 2) Marketing-mix modeling focuses on incremental growth instead of baseline sales or long term effects. 3) The integration of important metrics such as customer satisfaction, awareness, and brand equity into marketing-mix modeling is limited. 4) Marketing-mix modeling generally fails to incorporate metrics related to competitors, the trade, or the sales force. Objective: 8Difficulty: Moderate

231) Greenfoods, a manufacturer of ready-to-eat foods, conducts over 60,000 customer surveys each month through its retail outlets. What risk is Greenfoods likely to face by putting out so many surveys each month?Answer: By putting out so many surveys each month, Greenfoods may run the risk of creating "survey burnout" and seeing response rates drop sharply. Objective: 6AACSB: Analytic skillsDifficulty: Difficult

232) As a marketing researcher of a firm, you have planned to conduct behavioral research to develop marketing insight. What procedure would you follow in this case?Answer: In order to conduct behavioral research, the marketing researchers need to develop consumer insight by analyzing store scanning data, catalog purchases, and customer databases. Objective: 6AACSB: Analytic skillsDifficulty: Moderate

233) Suppose, as a marketing manager of a firm, you have planned to conduct a market research using qualitative measures. For the purpose of developing consumer insight you have distributed among the respondents a picture of a man and woman in a coffee shop, and have asked the respondents to make up a story about what is happening in the picture. Identify and define the type of question used in this case.Answer: The marketing manager has used Thematic Apperception Test in this case. In Thematic Apperception Test, a picture is presented and respondents are asked to make up a story about what they think is happening or may happen in the picture. Objective: 6AACSB: Analytic skillsDifficulty: Moderate

234) The Bledsoe Marketing Research group has been hired to administer a series of questions to shoppers in a local mall. If questions on the survey questionnaire have only two possible responses (such as "yes/no" ), what type of questions are these? Answer: Questions of this type are closed-end questions that are dichotomous in nature. Objective: 6AACSB: Analytic skillsDifficulty: Moderate


235) As a marketing researcher, if you plan to conduct your research using qualitative measures like brand personification, what are you likely to ask the respondents in order to elicit their impression on your brand? Answer: Student answers may vary. When the marketing researcher uses the brand personification approach to get inside consumers' minds and find out what they think or feel about brands and products, he is likely to ask the respondents what kind of person they think of when the brand is mentioned. Objective: 6AACSB: Analytic skillsDifficulty: Moderate

236) Jane is a marketing researcher of a cellular service providing firm. She is conducting a market research before the firm decides to launch its 3G services. After deciding on the research approach and instruments, what is the next step that Jane should follow? What are the three things that she is required to consider in this step?Answer: After deciding on the research approach and instruments, Jane must design a sampling plan.In order to design the plan, Jane has to decide upon the sampling unit (whom she should survey?), the sample size (how many people should she survey?), sampling procedure (how should she choose the respondents?). Objective: 6AACSB: Analytic skillsDifficulty: Difficult

237) A marketing research firm has instructed its research associates to collect primary data by stopping people at a shopping mall or busy street corner and request an interview on the spot. Which contact method is being used by the researchers in this case? What probable risk may the researchers face while using this method?Answer: The researchers are using intercept interviewing method for collecting primary data in this case.The researchers run the risk of including nonprobability samples while using this method. Objective: 6Difficulty: Moderate

238) Aromas is a popular brand of cosmetic products. During the last quarter, the company suffered a drop in sales of some of its more popular offerings. In an attempt to find out the problem, Aromas designed an online questionnaire for its existing customers, who can fill out the questionnaire and also leave their comments and suggestions for improvement. What are the problems that Aromas is likely to face by using this method of contacting its customers?Answer: Student answers will vary. Aromas is using online contact method to gather customer feedback. The major problems of using this method are- 1) samples may be small and skewed, 2) online panels and communities can suffer from excessive turnover, 3) such online market research can suffer from technological problems and inconsistencies. Objective: 6AACSB: Analytic skillsDifficulty: Difficult


239) As a marketing controller of a company, you have been asked to create a stakeholder-performance scorecard that tracks the satisfaction of various constituencies who have a critical interest and impact your company's performance. List four constituencies that might be included. Answer: The stakeholder-performance scorecard could track the satisfaction of employees, suppliers, banks, distributors, retailers, and stockholders. Objective: 8AACSB: Analytic skillsDifficulty: Moderate

240) As a marketing controller of a company you have been asked to develop a customer-performance scorecard for your company's toy division. List three measures you might include. Answer: The three measures that might be included are-(1) percentage of new customers to average number of customers; (2) percentage of lost customers to average number of customers; (3) percentage of win-back customers to average number of customers. Answers may vary. Objective: 8AACSB: Analytic skillsDifficulty: Difficult


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