Questions and Answers
The extensiveness of distribution channels is related to the brand's life cycle or the company's maturity in the marketplace.
True
ABC Groceries has established private labels in several categories, including locally grown canned fruits and vegetables. This is an example of backward integration.
True
The system with an intermediary channel member is more efficient than all firms going direct to consumers.
True
If Tara wants to open her own ABC franchise, she will have to pay an upfront fee as well as royalties to the franchisor.
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What phrase refers to the fact that conflict can be squashed if one player is inherently more powerful than another?
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When the decisions seem overwhelming, we should simplify and remember that the key to marketing is to think about the?
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A perspective by which the benefits a company brings to its partners, beyond cost reductions, are emphasized is referred to as?
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Costs of __________ are the relational issues incurred by trying to coordinate the enterprise and control one's partners.
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Which of the following is one of the complaints Mark is MOST likely to hear?
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What term refers to the decision of whether to produce uniforms in-house or outsource?
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When a retailer is planning for its sales force, what is the next question it should ask after determining the number of salespeople?
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Top managers at S & A, Inc. believe that their staff needs some help understanding the perspectives and needs of the distributors they work with.
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There's a markup when the manufacturer yields product to the retailer, and there's a second markup when the retailer makes the product available to the consumer.
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When channel partners differ in their opinions on how to please customers and maximize profit, conflict can arise.
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What is it called when Apple opened Apple stores after being in the manufacturing business only?
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The channels for products that require customer assistance before purchasing are often structured to be?
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What typically determines the size of a sales force?
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The quality of a company's sales force is likely to be the most significant means of differentiation when it manufactures and sells an undifferentiated product line.
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Some cost is associated with each link in a distribution channel so all links should contribute value.
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Which identifies a major class of franchising?
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Transaction cost analysis is a model that does not consider channel members' marketing costs and governance costs because they are ideally minimized.
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What is Sheila considering if she wants to maintain some control while giving up complete ownership of her boutique?
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In pricing its products, BrainTrust Company needs to estimate transportation costs to what percentage of total distribution cost?
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Most buyers wish to purchase a larger quantity of a wider variety of goods.
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In making their decision to sell directly to consumers, Archie and Betty should consider the complexity of their product.
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Channel members frequently bicker over prices and margins.
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Company ABC is trying to determine which products it should introduce. It is more efficient for Company ABC to produce a large quantity of a limited number of goods.
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In push marketing, the manufacturer targets __________ rather than __________.
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Wanting to please the customer but being unable to do so is an example of role conflict.
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Buyers and sellers usually come to the table as equals when bargaining.
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Arbitration is when the third party makes a binding decision for the two conflicting parties.
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Channel experts speak of trust as both the willingness and ability to deliver on promises.
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ABC Groceries sells private label pastries and pastries made by a local bakery that is a channel partner. This is an example of __________ competition.
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Foluke and Rachael need to buy appliances for a restaurant that they will open in a few months. To save money, they can purchase the appliances through intensive distribution channels.
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When power is used to resolve conflict, the less powerful player can feel resentful and look to leave the channel arrangement as soon as another opportunity becomes available.
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Study Notes
Distribution Channels and Brand Lifecycle
- Distribution channel extensiveness varies with a brand's life cycle and market maturity.
- Intermediary systems tend to be more efficient than direct-to-consumer approaches.
Integration Strategies
- Backward integration involves a firm taking control of its supply chain, as seen with ABC Groceries establishing private labels.
- Forward integration occurs when a manufacturer expands into retail, exemplified by Apple opening its stores.
Franchising Dynamics
- Franchisees like Tara must pay initial fees and royalties to the franchisor.
- Sheila is considering franchising to maintain partial control while transferring ownership of her boutique.
Marketing and Sales Processes
- Effective sales force planning begins by assessing the appropriate number of salespeople.
- Compensation strategies for salespeople are critical to address after assessing staffing needs.
Pricing and Costs
- Transaction costs in a distribution channel encompass not just production and marketing but also governance expenses.
- Transportation typically constitutes approximately 50% of total distribution costs.
Channel Conflict and Governance
- Powerful channel members can impose solutions to conflicts, potentially leading to resentment among weaker members.
- Disputes often arise over pricing and margins among channel partners.
Customer-Centric Decision Making
- Marketing strategies should focus on customer needs, particularly in overwhelming decision-making scenarios.
- Role conflict may arise when a seller strives to satisfy customers but feels unable to do so.
Sales Force and Product Complexity
- The complexity of products is a significant factor when deciding on direct selling without a sales force.
- The size of a sales force is typically determined by estimated workload.
Channel Types and Marketing Approaches
- Push marketing targets channel members rather than end consumers, emphasizing the need for strong distributor relationships.
- Vertical competition occurs when a retailer sells both private label goods and those from channel partners.
Conflict Resolution
- Arbitration involves a third party imposing binding resolutions on conflicting parties, essential for resolving disputes.
- Trust in channel relationships is defined by the ability to fulfill promises, enhancing cooperation among members.
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Description
This quiz covers essential concepts in marketing strategies, focusing on distribution channels, integration strategies, and franchising dynamics. It also addresses the importance of sales processes and pricing in effective marketing. Test your understanding of these critical aspects of marketing management.
