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Chapter 08 - Integrated Marketing Communications
Chapter 08
Integrated Marketing Communications
Multiple Choice Questions
8-1
Chapter 08 - Integrated Marketing Communications
4. Producers help retailers who carry their brands by all of the following ways EXCEPT:
a. arranging with retailers to distribute coupons.
b. setting up special displays in retail stores.
c. featuring their brands in retailers’ ads.
d. holding promotional events in retail stores.
Answer: c
Topic: Strategic Goals of Marketing Communication
Blooms: Understand
AACSB: Analytic
Level of Difficulty: Medium
Page: 119
Explanation: When producers use marketing communications to generate awareness, they are
also helping the retailers who carry the product. Producers may arrange with retailers to
distribute coupons, set up special displays, or hold promotional events in their stores, all of
which benefit retailers and wholesalers. Retailers support manufacturers when they feature
brands in their ads to attract buyers.
5. Which of the following is NOT true of the strategic goal of retaining customers?
a. It costs far more to retain an existing customer than to attract a new customer.
b. Loyal customers are a major asset for every business.
c. Marketing communications can support efforts to create value for existing customers.
d. Interactive modes of communication play an important role in retaining customers.
Answer: a
Topic: Strategic Goals of Marketing Communication
Blooms: Understand
AACSB: Analytic
Level of Difficulty: Medium
Page: 119
Explanation: Loyal customers are a major asset for every business. It costs far more to attract
a new customer than to retain an existing customer. Marketing communications can support
efforts to create value for existing customers. Interactive modes of communication can play
an important role in retaining customers.
8-2
Chapter 08 - Integrated Marketing Communications
6. Which of the following refers to the combination and types of nonpersonal and personal
communication that the organization puts forth during a specified period?
a. Promotion mix
b. Demographic concentration
c. Segment communication
d. Push and pull strategies
Answer: a
Topic: The Promotion Mix
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 119
Explanation: The promotion mix concept refers to the combination and types of nonpersonal
and personal communication the organization puts forth during a specified period.
7. Which of the following products is most likely to contain short-run incentives in its
promotion mix?
a. An essential commodity
b. An established product witnessing seasonal decline in sales
c. A product in the decline stage of the product life cycle
d. A product in the research and development stage of the product life cycle
Answer: b
Topic: The Promotion Mix
Blooms: Understand
AACSB: Analytic
Level of Difficulty: Medium
Page: 120
Explanation: If the product is more established but the objective is to stabilize sales during a
nonpeak season, the promotion mix will likely contain short-run incentives (sales promotions)
for people to buy the product immediately.
8. If a product is a new complex technology that requires a great deal of explanation, its
promotional mix will most likely:
a. focus heavily on personal selling.
b. contain short-run incentives.
c. feature public relation efforts.
d. rely on advertising through mass media.
Answer: a
Topic: The Promotion Mix
Blooms: Understand
AACSB: Analytic
Level of Difficulty: Medium
Page: 120
Explanation: If the product is a new complex technology that requires a great deal of
explanation, the promotional mix will likely focus heavily on personal selling so that potential
buyers can have their questions answered.
8-3
Chapter 08 - Integrated Marketing Communications
10. Which of the following is a paid form of nonpersonal communication that uses media
such as outdoor displays, car cards, or directories to reach out to a target audience?
a. Direct marketing
b. Advertising
c. Personal selling
d. Sales promotion
Answer: b
Topic: The Promotion Mix
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 120
Explanation: Advertising is a paid form of nonpersonal communications about an
organization, its products, or its activities that is transmitted through a mass medium to a
target audience. The mass medium might be television, radio, newspapers, Internet,
magazines, outdoor displays, car cards, or directories.
11. The nonpersonal promotional effort for a new breakfast cereal is least likely to rely on:
a. advertising.
b. sales promotion.
c. public relations.
d. personal selling.
Answer: d
Topic: The Promotion Mix
Blooms: Apply
AACSB: Analytic
Level of Difficulty: Medium
Page: 120
8-4
Chapter 08 - Integrated Marketing Communications
Explanation: Marketers strive for the right mix of promotional elements to ensure that their
product is well received. If the product is a new soft drink, promotional effort is likely to rely
more on advertising, sales promotion, and public relations in order to (1) make potential
buyers aware of the product, (2) inform these buyers about the benefits of the product, (3)
convince buyers of the product’s value, and (4) entice buyers to purchase the product.
13. Which of the following elements of the promotional mix are coupons, sweepstakes,
refunds, and displays examples of?
a. Advertising
b. Sales promotion
c. Public relations
d. Direct marketing
Answer: b
Topic: The Promotion Mix
Blooms: Apply
AACSB: Analytic
Level of Difficulty: Medium
Page: 120
Explanation: Sales promotion is an activity or material that offers customers, sales personnel,
or resellers a direct inducement for purchasing a product. This inducement, which adds value
to or incentive for the product, might take the form of a coupon, sweepstakes, refund, or
display.
8-5
Chapter 08 - Integrated Marketing Communications
14. An activity or material that offers customers or resellers a direct inducement for
purchasing a product is called:
a. sales promotion.
b. advertising.
c. public relations.
d. personal selling.
Answer: a
Topic: The Promotion Mix
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 120
Explanation: Sales promotion is an activity or material that offers customers, sales personnel,
or resellers a direct inducement for purchasing a product.
15. Which of the following is a nonpersonal form of communication that seeks to influence
the attitudes, feelings, and opinions of customers, noncustomers, stockholders, suppliers,
employees, and political bodies about the organization?
a. Direct mail
b. Online marketing
c. Telemarketing
d. Public relations
Answer: d
Topic: The Promotion Mix
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 120
Explanation: Public relations is a nonpersonal form of communication that seeks to influence
the attitudes, feelings, and opinions of customers, noncustomers, stockholders, suppliers,
employees, and political bodies about the organization. Direct marketing, on the other hand,
uses direct forms of communication with customers. It can take the form of direct mail, online
marketing, catalogs, telemarketing, and direct response advertising.
16. A nonpaid form of nonpersonal communication about an organization and its products
that is transmitted through a mass medium in the form of a news story is referred to as:
a. advertising.
b. branding.
c. publicity.
d. online marketing.
Answer: c
Topic: The Promotion Mix
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 120
8-6
Chapter 08 - Integrated Marketing Communications
18. The promotional mix of a new complex technology is most likely to focus on:
a. mass media.
b. sales promotion.
c. advertising.
d. personal selling.
Answer: d
Topic: The Promotion Mix
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 120
Explanation: If the product is a new complex technology that requires a great deal of
explanation, the promotional mix will likely focus heavily on personal selling so that potential
buyers can have their questions answered.
19. The marketing department of Cool-down, Inc., noticed that customers are not buying as
many bottles of Cool-down soft drink in December as they usually do in July. Cool-down
decided to offer coupons and refunds. It also planned a sweepstake. Which of the following
elements of the promotional mix is Cool-down trying to use?
a. Personal selling
b. Direct marketing
c. Sales promotion
d. Public relations
Answer: c
8-7
Chapter 08 - Integrated Marketing Communications
20. Fashion Inc., a designer clothing company, jointly develops its advertisement plans and
sales promotions to create a consistent message for its customers. Fashion Inc. is using:
a. a traditional approach.
b. integrated marketing.
c. mass communication.
d. promotional tactics.
Answer: b
Topic: Integrated Marketing Communications
Blooms: Apply
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Explanation: The goal of integrated marketing communications is to develop marketing
communications programs that coordinate and integrate all elements of promotion—
advertising, sales promotion, personal selling, and publicity—so that the organization presents
a consistent message. Integrated marketing communication seeks to manage all sources of
brand or company contacts with existing and potential customers.
21. Sun Products markets Snug fabric softener. It uses the image of a soft bear named Snug in
television and print ads for the fabric softener. The bear, which is used as a sales promotion
device, also appears on T-shirts, and is extensively used on Sun Products’ Web site. Sun
Products is focusing on:
a. mass marketing and customer acquisition.
b. public relations exclusively to promote its product.
c. monitoring spending habits of customers.
d. presenting a consistency on brand messages.
Answer: d
Topic: Integrated Marketing Communications
Blooms: Apply
AACSB: Reflective Thinking
Level of Difficulty: Hard
Page: 121
Explanation: Integrated marketing coordinates and integrates all elements of promotion,
advertising, sales promotion, personal selling, and publicity, so that the organization presents
a consistent message.
8-8
Chapter 08 - Integrated Marketing Communications
22. The implementation of integrated marketing is slower than many would like to see. Which
of the following is hindering its successful implementation?
a. A lack of planning and budget problems
b. Internal “turf” battles within the organization
c. Lack of vision and planning
d. Destruction of creativity due to broadening of scope
Answer: b
Topic: Integrated Marketing Communications
Blooms: Understand
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Explanation: Internal “turf” battles within organizations and the reluctance of some
advertising agencies to willingly broaden their role beyond advertising are two factors that are
hindering the successful implementation of integrated marketing communication.
23. Which of the following is a factor hindering the successful implementation of integrated
marketing communication?
a. A lack of planning and budget problem
b. Reluctance of advertising agencies to broaden their role
c. Lack of vision and planning
d. Destruction of creativity due to broadening of scope
Answer: b
Topic: Integrated Marketing Communications
Blooms: Understand
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Explanation: Internal “turf” battles within organizations and the reluctance of some
advertising agencies to willingly broaden their role beyond advertising are two factors that are
hindering the successful implementation of integrated marketing communication.
24. Which of the following promotion tools would have the maximum success in encouraging
a buyer into ordering a product?
a. Advertising
b. Personal selling
c. Sales promotion
d. Public relations
Answer: b
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Fig. 8.1
8-9
Chapter 08 - Integrated Marketing Communications
Explanation: Personal selling appears to be the most effective promotion tool when it comes
to encouraging a buyer to order a product.
25. Which of the following promotional tools is least likely to produce comprehension among
potential buyers?
a. Sales promotion
b. Personal selling
c. Advertising
d. Public relations
Answer: d
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Fig. 8.1
Explanation: Public relations is the least effective tool in terms of enabling prospective buyers
to comprehend the various aspects of the product.
26. Which of the following promotional tools is least likely to produce conviction among
potential buyers?
a. Sales promotion
b. Personal selling
c. Advertising
d. Public relations
Answer: d
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Fig. 8.1
Explanation: Public relations is the least effective tool in terms of producing conviction
among potential buyers.
27. Which of the following promotional tools is most likely to be successful in creating
awareness among potential buyers?
a. Personal selling
b. Door-to-door selling
c. Public relations
d. Sales promotion
Answer: c
8-10
Chapter 08 - Integrated Marketing Communications
28. Which of the following promotion tools is most likely to be successful in aiding the
comprehension process of potential buyers?
a. Personal selling
b. Advertising
c. Sales promotion
d. Public relation
Answer: c
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Fig. 8.1
Explanation: Sales promotion is the most effective promotion tool in terms of aiding the
comprehension process of potential buyers.
29. _____ are most suitable for convincing potential buyers that a product has value for them.
a. Personal selling and advertising
b. Advertising and sales promotion
c. Sales promotion and public relations
d. Public relations and personal selling
Answer: a
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Fig. 8.1
Explanation: Personal selling and advertising are most suitable for convincing potential
buyers that a product has value for them.
8-11
Chapter 08 - Integrated Marketing Communications
30. _____ are least suitable for spreading awareness of a product or service.
a. Personal selling and advertising
b. Advertising and public relations
c. Public relations and sales promotion
d. Sales promotion and personal selling
Answer: d
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Fig. 8.1
Explanation: Sales promotion and personal selling are least suitable for spreading awareness
of a product or service.
31. _____ are least likely to be successful in encouraging a buyer into ordering a product.
a. Personal selling and advertising
b. Advertising and public relations
c. Public relations and sales promotion
d. Sales promotion and personal selling
Answer: b
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Figure 8.1
Explanation: Advertising and public relation are least likely to be successful in encouraging a
buyer into ordering a product.
32. Public relations is best suited for which of the following steps of the buying process that
potential buyers usually go through?
a. Awareness
b. Comprehension
c. Conviction
d. Ordering
Answer: a
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Figure 8.1
Explanation: Public relations is best suited for creating awareness of a product or service.
8-12
Chapter 08 - Integrated Marketing Communications
33. Sales promotion is best suited for which of the following steps of the buying process that
potential buyers usually go through?
a. Awareness
b. Comprehension
c. Conviction
d. Ordering
Answer: b
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Figure 8.1
Explanation: Sales promotion is best suited for making potential buyers comprehend what a
product can do and what its important features are.
34. Advertising is best suited for which of the following steps of the buying process that
potential buyers usually go through?
a. Awareness
b. Comprehension
c. Conviction
d. Ordering
Answer: c
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Figure 8.1
Explanation: Advertising is best suited for convincing potential buyers that a product has
value for them.
35. Advertising is least suited for which of the following steps of the buying process that
potential buyers usually go through?
a. Awareness
b. Comprehension
c. Conviction
d. Ordering
Answer: d
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Figure 8.1
8-13
Chapter 08 - Integrated Marketing Communications
Explanation: Advertising is least suited for encouraging a potential buyer into ordering a
product.
36. Personal selling is best suited for which of the following steps of the buying process that
potential buyers usually go through?
a. Awareness
b. Comprehension
c. Conviction
d. Ordering
Answer: d
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Figure 8.1
Explanation: Personal selling is best suited for encouraging a potential buyer into ordering a
product.
37. Personal selling is least suited for which of the following steps of the buying process that
potential buyers usually go through?
a. Awareness
b. Comprehension
c. Conviction
d. Ordering
Answer: a
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 121
Refer to: Figure 8.1
Explanation: Personal selling is least suited for creating awareness of a product or service.
38. Potential buyers usually go through the buying process that consists of the following
steps: awareness, comprehension, conviction, and ordering. Of these steps, sales promotion is
least suited for:
a. awareness and comprehension.
b. comprehension and ordering.
c. conviction and ordering.
d. awareness and conviction.
Answer: c
Topic: Integrated Marketing Communications
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
8-14
Chapter 08 - Integrated Marketing Communications
Page: 121
Refer to: Figure 8.1
Explanation: Sales promotion is least suited for conviction and ordering.
39. If you have a generalist viewpoint about the contribution of advertising to the economic
health of your firm, you are most likely to be concerned with:
a. Starch Reports.
b. the Arbitron Index.
c. the Nielson Index.
d. return on investment.
Answer: d
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 122
Explanation: The generalist viewpoint is primarily concerned with sales, profits, return on
investment, and so forth. The specialist viewpoint is represented by advertising experts who
are primarily concerned with measuring the effects of specific ads; here primary attention is
given to organizations that offer services that measure different aspects of the effects of
advertising such as the Nielsen Index, Starch Reports, Arbitron Index, and Simmons Reports.
40. Which of the following viewpoints about the contribution of advertising to the economic
health of a firm understands and appreciates two other viewpoints but, in addition, sees
advertising as a competitive weapon?
a. The generalist viewpoint
b. The specialist approach
c. The strategic viewpoint
d. The marketing management approach
Answer: d
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Page: 122
Explanation: A middle view, one that might be classified as more of a marketing management
approach, understands and appreciates the generalist and the specialist viewpoints but, in
addition, sees advertising as a competitive weapon.
41. A company that manufactures cosmetics introduces a new product. To popularize this
product, they use unauthorized mailing lists to reach consumers. This represents ethical and
legal concerns related to _____.
a. advertising
b. public relations
c. sales promotion
d. mass media
8-15
Chapter 08 - Integrated Marketing Communications
Answer: c
Topic: Advertising: Planning and Strategy
Blooms: Apply
AACSB: Analytic
Level of Difficulty: Medium
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Using unauthorized mailing lists to reach consumers is an ethical and legal
concern associated with sales promotion.
42. Which of the following is an ethical and legal concern associated with advertising?
a. Failure to disclose product limitations or safety concerns
b. Using unauthorized mailing lists to reach consumers
c. Encouraging materialism and excessive consumption
d. Using economic power to gain favorable publicity
Answer: c
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Encouraging materialism and excessive consumption is an ethical and legal
concern associated with advertising.
43. Identify the ethical and legal concern associated with advertising.
a. Failure to disclose product limitations or safety concerns
b. Using consumer database information without consumers’ authorization
c. Reinforcing ethnic and racial stereotypes
d. Using economic power to gain favorable publicity
Answer: c
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Reinforcing ethnic and racial stereotypes is an ethical and legal concern
associated with advertising.
44. Which of the following is an ethical and legal concern associated with public relations?
a. Failure to disclose product limitations or safety concerns
b. Using unauthorized mailing lists to reach consumers
c. Reinforcing ethnic and racial stereotypes
d. Paying lip service to worthwhile causes
8-16
Chapter 08 - Integrated Marketing Communications
Answer: d
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Paying lip service to worthwhile causes is an ethical and legal concern
associated with public relations.
45. Identify the ethical and legal concern associated with public relations.
a. Failure to disclose product limitations or safety concerns
b. Using unauthorized mailing lists to reach consumers
c. Reinforcing ethnic and racial stereotypes
d. Orchestrating news events to present a false appearance of widespread support for the
company position
Answer: d
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Orchestrating news events to present a false appearance of widespread support
for the company position is an ethical and legal concern associated with public relations.
46. Which of the following is an ethical and legal concern associated with sales promotion?
a. Misrepresenting product health
b. Using unauthorized mailing lists to reach consumers
c. Reinforcing ethnic and racial stereotypes
d. Failure to disclose product limitations or safety concerns
Answer: b
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Using unauthorized mailing lists to reach consumers is an ethical and legal
concern associated with sales promotion.
47. Identify the ethical and legal concern associated with sales promotion.
a. Misrepresenting product health
b. Paying slotting allowances to gain retail shelf space
c. Reinforcing ethnic and racial stereotypes
d. Failure to disclose product limitations or safety concerns
8-17
Chapter 08 - Integrated Marketing Communications
Answer: b
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Paying slotting allowances to gain retail shelf space is an ethical and legal
concern associated with sales promotion.
48. Which of the following is an ethical and legal concern associated with personal selling?
a. Misrepresenting product health
b. Encouraging materialism and excessive consumption
c. Reinforcing ethnic and racial stereotypes
d. Using unauthorized mailing lists to reach consumers
Answer: a
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Misrepresenting product health is an ethical and legal concern associated with
personal selling.
49. Identify the ethical and legal concern associated with personal selling.
a. Failing to disclose product limitations or safety concerns
b. Encouraging materialism and excessive consumption
c. Reinforcing ethnic and racial stereotypes
d. Using unauthorized mailing lists to reach consumers
Answer: a
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Failing to disclose product limitations or safety concerns is an ethical and legal
concern associated with personal selling.
50. Which of the following is an ethical and legal concern associated with direct marketing
communications?
a. Failing to disclose product limitations or safety concerns
b. Using consumer database information without consumers’ authorization
c. Reinforcing ethnic and racial stereotypes
d. Using unauthorized mailing lists to reach consumers
8-18
Chapter 08 - Integrated Marketing Communications
Answer: b
Topic: Advertising: Planning and Strategy
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 123
Refer to: Marketing Insight 8-3
Explanation: Using consumer database information without consumers’ authorization is an
ethical and legal concern associated with direct marketing communications.
51. As the marketing head of New Inc., you have to decide the size of the advertising budget
for a hair care product which was a star earner last year but has seen its market share plummet
recently. Which of the following is going to help the product regain its market share the most
in the long term?
a. Employ the art of discounting
b. Fund price promotions
c. View advertising as a nondiscretionary cost
d. Decide ad budget according to growth trends
Answer: c
Topic: Advertising Decisions
Blooms: Apply
AACSB: Reflective Thinking
Level of Difficulty: Hard
Page: 124
Explanation: Many marketers practice the art of discounting. Companies employing these
tactics may benefit in the short term but may be at a severe competitive disadvantage in the
long term. Some marketers, however, know that brand equity and consumer preference for
brands drive market share. They realize the balance of advertising and promotion costs
needed to build brands and gain share, market by market, regardless of growth trends in
product categories where they compete. They do not raid their ad budgets to increase
earnings, nor do they view advertising as a discretionary cost.
52. Which of the following is going to help a product gain market share the most in the long
term?
a. Employ the art of discounting
b. Fund price promotions
c. View advertising as a nondiscretionary cost
d. Decide ad budget according to growth trends
Answer: c
Topic: Advertising Decisions
Blooms: Understand
AACSB: Analytic
Level of Difficulty: Medium
Page: 124
8-19
Chapter 08 - Integrated Marketing Communications
Explanation: Many marketers practice the art of discounting. Companies employing these
tactics may benefit in the short term but may be at a severe competitive disadvantage in the
long term. Some marketers, however, know that brand equity and consumer preference for
brands drive market share. They realize the balance of advertising and promotion costs
needed to build brands and gain share, market by market, regardless of growth trends in
product categories where they compete. They do not raid their ad budgets to increase
earnings, nor do they view advertising as a discretionary cost.
54. Which of the following approaches of determining advertising spending views advertising
as a function of sales, rather than sales as a function of advertising?
a. Per-unit expenditure
b. Rate-of-return
c. Competitive parity
d. The research approach
Answer: a
Topic: Advertising Decisions
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Page: 124
Explanation: The per-unit expenditure method views advertising as a function of sales, rather
than sales as a function of advertising.
55. The basic problem with this method of determining advertising spending is that it views
advertising as a function of sales, rather than sales as a function of advertising.
a. Percent of sales
b. Rate-of-return
c. Competitive parity
d. The research approach
Answer: a
Topic: Advertising Decisions
8-20
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