Basic Marketing A Strategic Marketing Planning Approach 19th Edition by Perreault – Test Bank

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Basic Marketing A Strategic Marketing Planning Approach 19th Edition by Perreault – Test Bank

Chapter 06 Business and Organizational Customers and Their Buying Behavior Answer Key
True / False Questions

1. There are more final consumers than business and organizational customers, so more is purchased by final consumers.

FALSE

More purchases are made by businesses and other organizations than by final consumers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

2. Organizational buyers are often referred to as the B2B market.

TRUE

Marketing managers often refer to organizational customers collectively as the “business-to-business” market, or simply, the B2B market.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

3. Organizational buyers are also referred to as industrial or intermediate buyers.

TRUE

Organizational customers are sometimes loosely referred to as business buyers, intermediate buyers, or industrial buyers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

4. The process of organizational buying is entirely different from consumer buying.

FALSE

Organizational buying is not entirely different from consumer buying. It tends to be different from buying by final consumers only in a few specific ways.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

5. Like final consumers, organizations make purchases to satisfy specific needs, but their basic need is for goods and services that will help them satisfy their own customers or clients.

TRUE

Most organizations make purchases with the basic intent to satisfy their own customers and clients.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

6. Business and organizational customers are selective buyers who buy for the sole purpose of resale.

FALSE

Business and organizational customers make purchases to satisfy their own customers and clients. Wholesalers or retailers buy products so they can profitably resell to their customers.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

7. Organizations always focus on economic factors when they make purchase decisions and are never as emotional as final consumers in their buying behavior.

FALSE

Organizations typically focus on economic factors when they make purchase decisions and are usually less emotional in their buying than final consumers.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

8. Dependability of supply is usually much less important than price for most business customers.

FALSE

An organization may not be able to function if purchases don’t arrive when they’re expected so dependability is often the most important thing.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

9. The approaches used to serve business customers in international markets are even more varied than those required to reach individual consumers.

FALSE

The basic approaches marketers use to deal with business customers in international markets are much less varied than those required to reach individual consumers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

10. Organizational buyers often buy on the basis of a set of purchasing specifications.

TRUE

Organizational buyers often buy on the basis of a set of purchasing specifications—a written (or electronic) description of what the firm wants to buy.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

11. A description of what a firm wants to buy is called its purchasing specifications, whether that description is written or electronic.

TRUE

Organizational buyers often buy on the basis of a set of purchasing specifications—a written or electronic description of what the firm wants to buy.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

12. Purchasing specifications should be used only with products where quality is highly standardized.

FALSE

When purchase requirements are complicated and when services are involved, purchase specifications are even more necessary.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

13. Purchase specifications for services are usually very simple because services tend to be very standardized.

FALSE

Purchase specifications for services tend to be detailed because services are less standardized and usually are not performed until after they’re purchased.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

14. Purchasing managers seldom use purchasing specifications to buy on the Internet.

FALSE

Purchasing managers often buy on the basis of a set of purchasing specifications whether written or electronic.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

15. Purchasing specifications may be very simple (with only a brand name or part number) or very detailed (as with services).

TRUE

When quality is highly standardized the specification may simply consist of a brand name or part number. However, the purchase requirements are more complicated; then the specifications may set out detailed information about the performance standards the product must meet.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

16. ISO 9000 is a way for a supplier to document that its quality procedures meet internationally recognized standards.

TRUE

ISO 9000 is a way for a supplier to document its quality procedures according to internationally recognized standards.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

17. ISO 9000 is only relevant to domestic suppliers.

FALSE

Organizational customers considering a new supplier or one from overseas may be concerned about product quality. However, this is becoming less of an obstacle because of ISO 9000.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

18. ISO 9000 is only relevant to international suppliers.

FALSE

ISO 9000 is relevant to both domestic and international suppliers.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

19. ISO 9000 is relevant to both domestic and international suppliers.

TRUE

ISO 9000 is a way for a supplier to document its quality procedures according to internationally recognized standards and is relevant to both domestic and international suppliers.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

20. With ISO 9000 someone is responsible for quality at every step.

TRUE

To get ISO 9000 certified a company must prove to outside auditors that it documents how the company operates and who is responsible for quality every step of the way.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

21. ISO 9000 reduces the need for a customer to conduct its own audit of a supplier’s quality procedures.

TRUE

ISO 9000 assures a customer that the supplier has effective quality checks in place, without the customer having to conduct its own costly and time-consuming audit.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

22. Purchasing managers are buying specialists for organizations and may have a lot of power.

TRUE

Many organizations rely on specialists or purchasing managers to ensure that purchases are handled sensibly.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

23. “Multiple buying influence” means that several people in an organization share in making a purchase decision, but top management is never involved.

FALSE

Multiple buying influence means that several people—perhaps even top management—play a part in making a purchase decision.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

24. Multiple-buying influence means that the buyer shares the purchasing decision with several people.

TRUE

Multiple-buying influence means that the buyer shares the purchasing decision with users, influencers, deciders, gatekeepers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

25. Multiple buying influence means that several people except top management share in making a purchase decision.

FALSE

Multiple-buying influence means that the buyer shares the purchasing decision with several people including users, influencers, deciders, gatekeepers. In many cases, top management plays a part in making a purchase decision.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

26. A buying center is generally thought of as all the people who participate in or influence a purchase.

TRUE

Different people may make up a buying center from one decision to the next. Hence, a buying center includes all the people who participate in or influence a purchase.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

27. In a large company, the “buying center” refers to all of the purchasing managers who work for the firm.

FALSE

A buying center is made up of all the people who participate in or influence a purchase—users, buyers, influencers, deciders, gatekeepers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

28. A seller’s marketing mix should satisfy BOTH the needs of the customer company and the needs of individuals in the buying center.

TRUE

Sellers need to find an overlapping area where both the needs of the customer company as well as the needs of individuals who influence the purchase are satisfied.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

29. A requisition is a request to buy something.

TRUE

A person who needs to purchase something usually completes a requisition—a request to buy something.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

30. A person who needs to purchase something usually completes a requisition.

TRUE

A person who needs to purchase something usually completes a requisition—a request to buy something.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

31. A straight rebuy is a routine repurchase that may have been made many times before.

TRUE

A straight rebuy is a routine repurchase that may have been made many times before. Buyers probably don’t bother looking for new information or new sources of supply.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

32. New-task buying is an in-between process where some review of the buying situation is done.

FALSE

New-task buying occurs when a customer organization has a new need and wants a great deal of information. It is not an in-between process.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

33. Straight-rebuy buying takes longer than modified-rebuy or new-task buying and offers more chance for promotion impact by the seller.

FALSE

Most of a company’s small or recurring purchases are straight rebuys and take only a small part of an organized buyer’s time.

 

AACSB: Analytic
Blooms: Create
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

34. Few purchasing managers have been able to turn over any of their order placing to computers because so few organizational purchases are routine.

FALSE

Generally, buyers program decision rules that tell the computer how to order and leave the details of following through to the computer. If conditions change, buyers modify the computer instructions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

35. The Internet is making even straight rebuys more competitive.

TRUE

E-commerce computer systems automatically handle a large portion of straight rebuys. Electronically sending purchase orders to the regular supplier, setting the delivery dates and scheduling production have made straight rebuys more competitive.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

36. When a variety of information sources are readily available in new-task buying, a buyer is much less likely to use a trusted source.

FALSE

Even though a wide variety of information sources are available, business buyers will use the sources they trust.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

37. Most purchasing managers use search engines as their FIRST step to satisfy new or unfamiliar questions.

TRUE

Most purchasing managers start with an Internet search when they need to identify new suppliers, better ways to meet needs, or information to improve decisions.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

38. Specialized search engines can help a business buyer search for products by description.

TRUE

Buyers often rely on highly specialized search engines for technically specific information.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

39. Specialized search engines can help a business buyer search for products using purchase specifications.

TRUE

Buyers often rely on highly specialized search engines for technically specific information.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

40. Specialized search engines can help a business buyer search for products by inspection.

FALSE

Buyers often rely on highly specialized search engines for comparing technical specifications and prices. In contract, inspection must be done first-hand.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

41. A business buyer who uses general purpose and/or specialized search engines may reduce the need to arrange for custom-produced items.

TRUE

A search across the whole web can often locate off-the-shelf products that eliminate the need to buy expensive, custom-made items.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

42. White papers, case studies, blogs, and videos are all ways for a seller’s website to provide a buyer with useful content.

TRUE

White papers often advocate a seller’s solution; case studies help in learning about how other companies have addressed similar needs. Video content and blogs also make a seller’s website more useful.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

43. Online communities are one way for buyers to connect with others who have already dealt with a similar need.

TRUE

Buyers especially value recommendations from others that have already dealt with a similar need. Online social networks are making it easier to connect with other buyers.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

44. As B2B buyers rely more on social networks, it’s more likely that communications from sellers will have even more influence.

FALSE

As buyers rely more on social networks, communications from marketers may have less influence on buyers’ attitudes and choices.

 

AACSB: Technology
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

45. A competitive bid is the terms of sale offered by a supplier in response to the purchase specifications posted by a buyer.

TRUE

When buyers in B2B markets have identified potential suppliers, they sometimes ask them to submit a competitive bid—the terms of sale offered by the supplier in response to the purchase specifications posted by a buyer.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 3 Hard
Topic: Organizational Buyers Are Problem Solvers
 

 

46. The Internet is making it faster and easier for organizational buyers to use competitive bidding procedures.

TRUE

Rather than search for suppliers, buyers sometimes post their requirements and invite qualified suppliers to submit a bid. Some firms set up or participate in a procurement website that directs suppliers to companies (or divisions of a company) that need to make purchases.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

47. Procurement sites operate for the benefit of buyers by directing suppliers to them at one convenient site.

TRUE

Some firms set up or participate in a procurement website that directs suppliers to companies (or divisions of a company) that need to make purchases.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

48. At a procurement site, competition among sellers is likely to increase.

TRUE

Procurement websites increase the number of suppliers competing for the business, which in turn drives down prices or provides more beneficial terms of sale.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

49. So far, B2B e-commerce has had little effect on the way organizations make purchase decisions and deal with suppliers.

FALSE

B2B e-commerce has had tremendous effect on the way organizations make purchase decisions and deal with suppliers. Search engines help in gathering information; websites with useful content, procurement websites, and online communities help buyers make purchase decisions.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

50. Internet tools used in the B2B market that focus primarily on lowering price do not always lower TOTAL purchasing costs.

TRUE

Internet tools used in the B2B market helps increase the number of suppliers competing for the business which can in turn drive down prices or provide more beneficial terms of sale. But sometimes dealing with one supplier with which a firm already has a good relationship is more important and lowers total cost.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

51. In business markets, suppliers usually want close relationships with customers; however, there’s little benefit to the customer of having closer relationships with suppliers.

FALSE

There are often significant benefits of a close working relationship between a supplier and a customer firm. And such relationships are becoming common.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

52. A close buyer-seller relationship in a business market may reduce a firm’s flexibility.

TRUE

Although close relationships can produce benefits, they are not always best. A long-term commitment to a partner may reduce flexibility.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

53. A long-term commitment by an organization to a partner may reduce flexibility.

TRUE

Although close relationships can produce benefits, they are not always best. A long-term commitment to a partner may reduce flexibility.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

54. In business markets, a seller would always prefer to have a closer relationship with a customer.

FALSE

It may at first appear that a seller would always prefer to have a closer relationship with a customer, but that is not so. Some customers place orders that are too small or require too much attention to be profitable.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

55. In business markets, buyer-seller relationships tend to be an “all-or-nothing” arrangement—either very close or not at all close.

FALSE

Buyer-seller relationships are not “all or nothing” arrangements. Many firms may have a close relationship in some ways and not in others.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

56. Although we talk about close “relationships” between firms in business markets, in practice it is just the relationship between the salesperson and purchasing manager that becomes close.

FALSE

Purchasing managers for the buying firm and salespeople for the supplier usually coordinate the different dimensions of a relationship. However, close relationships often involve direct contacts between a number of people from different areas in both firms—R&D, Quality, Accounting, Marketing, Production, Engineering, Finance.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

57. In cooperative relationships in a business market, the buyer and seller work together to jointly achieve both mutual and individual objectives.

TRUE

In cooperative relationships, the buyer and seller work together to achieve both mutual and individual objectives. The buyer and seller firms treat problems that arise as a joint responsibility.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

58. Just-in-time delivery reliably helps to get products and store them long before the customer needs them.

FALSE

Just-in-time delivery involves reliably getting products there, just before the customer needs them.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

59. Just-in-time relationships between buyers and sellers usually require operational linkages and information sharing.

TRUE

Closer relationships between buyers and sellers involve operational linkages and information sharing that lower costs and increase efficiency.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

60. Negotiated contract buying means agreeing to contracts that allow for changes in the purchase arrangements.

TRUE

Sometimes the buyer and seller know roughly what is needed but can’t fix all the details in advance. Then the relationship may involve negotiated contract buying, which means agreeing to contracts that allow for changes in the purchase arrangements.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

61. Negotiated contract buying would be used when the buyer knows precisely what he wants and the requirements of the job aren’t likely to change as the job is done.

FALSE

Sometimes the buyer and seller know roughly what is needed but can’t fix all the details in advance. Then the relationship may involve negotiated contract buying, which means agreeing to contracts that allow for changes in the purchase arrangements.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

62. Relationship-specific adaptations involve changes in a firm’s product or procedures that are unique to the needs or capabilities of a relationship partner.

TRUE

Relationship-specific adaptations involve changes in a firm’s product or procedures that are unique to the needs or capabilities of a relationship partner. Industrial suppliers often custom design a new product for just one customer; this may require investments in R&D or new manufacturing technologies.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

63. Specific adaptations are usually made when the buying organization chooses to outsource.

TRUE

Specific adaptations are usually made when the buying organization chooses to outsource.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 3 Hard
Topic: Buyer-Seller Relationships in Business Markets
 

 

64. Relationship-specific adaptations are usually not required when the buying organization uses outsourcing.

FALSE

Specific adaptations are usually made when the buying organization chooses to outsource.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

65. To protect themselves from unpredictable events, most purchasing managers seek several dependable sources of supply.

TRUE

Buyers often look for several dependable sources of supply to protect themselves from unpredictable events such as strikes, fires, or floods in one of their suppliers’ plants.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

66. Most manufacturers are quite small, with 250 or fewer employees.

TRUE

One of the most striking facts about manufacturers is that they are few in number when compared to number of final consumers. Statistics presented in Exhibit 6-6 show that only about 3 percent of all plants have 250 or more employees.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

67. Compared to final consumers, manufacturers tend to be more spread out geographically.

FALSE

Manufacturing industries are concentrated in certain geographic areas.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

68. In the U.S., many factories are concentrated in rural areas.

FALSE

In the United States, many factories are concentrated in big metropolitan areas—especially in New York, Pennsylvania, Ohio, Illinois, Texas, and California.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

69. It is very common for manufacturers to concentrate in certain geographic areas and by type of industry.

TRUE

Industrial markets are concentrated in certain geographic areas. There is also concentration by industry. In Germany, for example, the steel industry is concentrated in the Ruhr Valley. Similarly, U.S. manufacturers of high-tech electronics are concentrated in California’s famous Silicon Valley near San Francisco and also along Boston’s Route 128.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

70. The U.S. government collects and publishes data by the NAICS codes.

TRUE

The U.S. government collects and publishes data by the North American Industry Classification System (NAICS) codes—groups of firms in similar lines of business.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

71. The term “NAICS” stands for New Auto Industry Classification Survey.

FALSE

NAICS stands for North American Industry Classification System.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

72. The U.S. government reports data on the number of firms, sales volume, and number of employees by NAICS code.

TRUE

The U.S. government publishes data about number of establishments, sales volumes, and number of employees—broken down by geographic areas as per the NAICS code.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

73. Firms that are described by NAICS code 3152 are more similar than firms described by NAICS code 31.

TRUE

The NAICS code breakdowns start with broad industry categories such as construction (23) that have 2 digits. These further break down to 3 digits and then 4, 5, and 6 digitis. The more digits, the more detailed the data so that NAICS codes with 4 digits list firms that are more similar than codes with just 2 digits.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

74. In a market composed of service producers, most firms are small and geographically dispersed.

TRUE

Given the fact that there are a large number of service firms in the United States, most of them are small in size. They’re also more spread out around the country than manufacturing concerns.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: Producers of Services-Smaller and More Spread Out
 

 

75. There are about 17 times as many service firms as manufacturing firms.

TRUE

The United States has almost 6 million service firms—more than 17 times as many as it has manufacturers.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: Producers of Services-Smaller and More Spread Out
 

 

76. Purchasing managers are even more likely to be involved in buying by small service firms than in buying by large producers.

FALSE

Purchases by small service firms are often handled by whoever is in charge or their administrative assistant. This may be a doctor, lawyer, owner of a local insurance agency, hotel manager, or their secretary or office manager.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: Producers of Services-Smaller and More Spread Out
 

 

77. Purchases by small service firms are often handled by whoever is in charge or their administrative assistant.

TRUE

Purchases by small service firms are often handled by whoever is in charge or their administrative assistant. This may be a doctor, lawyer, owner of a local insurance agency, hotel manager, or their secretary or office manager.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: Producers of Services-Smaller and More Spread Out
 

 

78. Most retail and wholesale buyers see themselves as purchasing agents for their target customers.

TRUE

Most retail and wholesale buyers see themselves as purchasing agents for their target customers. Typically, retailers do not see themselves as sales agents for particular manufacturers. They buy what they think they can profitably sell.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: Retailers and Wholesalers Buy for their Customers
 

 

79. Sales reps calling on large food retailers often must make their sales presentations to a buyer who doesn’t have the final decision responsibility.

TRUE

Decisions to add or drop product lines or change buying policies may be handled by a buying committee of retail chains. The seller still calls on and gives a pitch to a buyer—but the buyer does not have final responsibility.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: Retailers and Wholesalers Buy for their Customers
 

 

80. Most wholesalers and retailers pay very close attention to each item they handle, treating most products as new-task purchases.

FALSE

Retailers and wholesalers usually carry a large number of products. A drug wholesaler, for example, may carry up to 125,000 products. Because they deal with so many products, most intermediaries buy their products on a routine, automatic reorder basis—straight rebuys. They don’t have time to pay attention to each item.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: Retailers and Wholesalers Buy for their Customers
 

 

81. The government is the largest customer group in all countries.

FALSE

Government is the largest customer group in many countries—including the United States. About 30 percent of the U.S. gross domestic product is spent by various government units.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

82. Government is one of the smallest groups (in sales volume) of customers in the United States.

FALSE

Government is the largest customer group in the United States. They account for about 30 percent of the U.S. gross domestic product.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

83. When selling to government customers, competitive bids are common.

TRUE

Government buyers in the United States are expected to spend money wisely—in the public interest. Most government customers buy by specification using a mandatory bidding procedure.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

84. To share in the government market, it is advantageous to be on the list of approved suppliers.

TRUE

To share in the government market, a supplier must be on the list of approved suppliers and agree on a price that will stay the same for a specific period—perhaps a year.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

85. To compete in the government market, it is very important that marketing mixes are well matched with different bid procedures.

TRUE

Potential suppliers should focus on the government units or prime contractors they want to cater to and learn the bidding methods of those units. Target marketing can make a big contribution here—making sure the marketing mixes are well matched with the different bid procedures.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

86. The Internet is not very useful for firms that want to target government markets.

FALSE

To promote competition for their business, the government agencies provide a lot of information to the marketers both in print form and online. The online resources include USA.gov, FedBizOpps.gov (www.fbo.gov), www.gsa.gov, osdbu.gov/offices.html that carry information for vendors, prime contractors and other marketers.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

87. Although outright influence peddling is common in some international markets, it is not allowed under the Foreign Corrupt Practices Act.

TRUE

Outright influence peddling—where government officials or their friends request bribe money to sway a purchase decision—is common in some markets. However, the Foreign Corrupt Practices Act, passed by the U.S. Congress in 1977, prohibits U.S. firms from paying bribes to foreign officials.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

Multiple Choice Questions

88. Regarding U.S. business and organizational customers,

A. more goods and services are purchased by business and organizational customers than by final consumers.

 

B. there are more business and organizational customers than final consumers.

 

C. there are more manufacturers than all other types of business and organizational customers combined.

 

D. more goods and services are purchased by government buyers than by all other business and organizational customers.

 

E. None of these alternatives is correct.

Most people think about an individual final consumer when they hear the term customer. But many marketing managers aim at customers who are not final consumers. In fact, more purchases are made by businesses and other organizations than by final consumers.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 3 Hard
Topic: Business and Organizational Customers-A Big Opportunity
 

 

89. In marketing, business and organizational customers are distinct from:

A. intermediaries

 

B. government units

 

C. final consumers

 

D. manufacturing and service firms

 

E. non-profit organizations

Final consumers are individual shoppers. In contrast, business and organizational buyers are made up of government units, intermediaries, manufacturing and service companies, and nonprofit organizations. Business and organizational customers are any buyers who buy for resale or to produce other goods and services.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Business and Organizational Customers-A Big Opportunity
 

 

90. The “business-to-business” market (B2B market) is comprised of:

A. nonprofit organizations only.

 

B. wholesalers and retailers only.

 

C. manufacturers only.

 

D. all businesses, governments, and nonprofits.

 

E. government units only.

Marketing managers refer to any and all organizational customers collectively as the “business-to-business” market, or simply, the B2B market. This includes businesses, governments, and nonprofit organizations.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

91. Which of the following statements accurately compares marketing to final consumers with marketing to organizational customers?

A. Marketing to organizations is just like marketing to final consumers.

 

B. Business-to-business marketing includes marketing to final consumers.

 

C. Purchasing decisions by organizational buyers are usually more economic and less emotional as compared to consumers.

 

D. Firms may choose to serve either organizational buyers or final consumers, but not both.

 

E. Consumers are more likely to utilize purchasing specifications as compared to B2B buyers.

Organizations typically focus on economic factors when they make purchase decisions and are usually less emotional in their buying than final consumers.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Business and Organizational Customers-A Big Opportunity
Topic: Organizational Customers are Different
 

 

92. Which of the following is not a concern of organizational buyers?

A. Original cost and ongoing costs of purchase

 

B. Impact of purchase on productivity

 

C. Product quality

 

D. Seller’s ability to provide speedy maintenance and repair

 

E. All of these are concerns for organizational buyers.

Organizational buyers are concerned with meeting a range of economic needs, from the cost and quality of products to the seller’s ability to provide maintenance and repair. In business markets, organizational buyers do not bid for suppliers; instead, suppliers offer bids to provide goods and services to organizational buyers.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

93. Which of the following are NOT “business and organizational customers?”

A. Wholesalers

 

B. Manufacturers

 

C. Financial institutions

 

D. Government units

 

E. All of these ARE business and organizational customers.

There are many different types of organizational customers, including: Producers of goods and services, Intermediaries; Government units; Nonprofit organizations.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

94. Which of the following is NOT an organizational buyer?

A. The Red Cross buying office supplies.

 

B. A sporting goods retailer buying skis.

 

C. A law office buying a background music service.

 

D. A country club buying tennis balls for a tournament.

 

E. All of these are organizational buyers.

There are many different types of organizational customers, including: Producers of goods and services, Intermediaries; Government units; Nonprofit organizations.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

95. Which of the following is NOT an example of an organizational buyer?

A. A government buyer purchasing a new desk for the mayor’s office.

 

B. A woman buying cookware to sell to her friends and neighbors.

 

C. A sales rep buying a new necktie to make a good impression.

 

D. A wholesaler buying a delivery truck.

 

E. None of these is a good example of an organizational buyer.

A sales rep buying a new necktie to make a good impression is an example of an individual final consumer, not an organizational buyer.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

96. Which of the following is a business or organizational customer, as opposed to an individual final consumer?

A. A wholesaler purchasing merchandise for resale.

 

B. A business executive who purchases a new suit.

 

C. A teacher who fills her car with gasoline.

 

D. A homeowner who buys flowers at a garden center.

 

E. None of these is a business or organizational customer.

A wholesaler purchasing merchandise for resale represents a business or organizational customer while the rest are final consumers.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

97. The college or university that you attend is considered which type of organizational customer?

A. Producer.

 

B. Intermediary.

 

C. Government.

 

D. Nonprofit.

Producers of goods and services are organizational customers. A college/university is a producer.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

98. John Deere is considered which type of organizational customer?

A. Producer.

 

B. Intermediary.

 

C. Government.

 

D. Nonprofit.

Producers of goods and services are organizational customers. John Deere is a manufacturer of agricultural, construction, and grounds-care equipment.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

99. Bank of Omaha is an example of what type of organizational customer?

A. Government

 

B. Nonprofit

 

C. Producer

 

D. Intermediary

 

E. Resident buyer

Producers of goods and services are organizational customers. Bank of Omaha is an example of a service-oriented organization.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

100. Macy’s is considered which type of organizational customer?

A. Producer.

 

B. Intermediary.

 

C. Government.

 

D. Nonprofit.

Intermediaries (wholesalers and retailers) are organizational customers. Macy’s, a department store chain, is an intermediary.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

101. Radio Shack is an example of what type of organizational customer?

A. Retailer

 

B. Producer

 

C. Government

 

D. Nonprofit

 

E. Wholesaler

Intermediaries (wholesalers and retailers) are organizational customers. Radio Shack is a retail store for electronics.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

102. The St. Louis Symphony is an example of what type of organizational customer?

A. Government

 

B. Wholesaler

 

C. Intermediary

 

D. Resident buyer

 

E. Nonprofit

The St. Louis Symphony is an American symphony orchestra, a nonprofit organization.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Business and Organizational Customers-A Big Opportunity
 

 

103. Concerning consumer and business markets:

A. promotion to consumer markets usually relies more heavily on the use of personal selling.

 

B. it is often easier to define customer needs in business markets.

 

C. a marketing mix directed at an organizational customer is usually less precisely adjusted to the needs of the specific customer.

 

D. None of these alternatives is correct.

Like final consumers, organizations make purchases to satisfy needs. But it’s often easier to understand an organization’s needs because most organizations make purchases for the same basic reason.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

104. As compared to final consumers, organizations

A. always focus on economic factors.

 

B. have more varied needs, and require more varied marketing mixes.

 

C. have needs that are often easier to understand.

 

D. always set out detailed information about the performance standards the product must meet when quality is highly standardized.

 

E. are usually more emotional in their buying than final consumers.

It is often easier to understand an organization’s needs because most organizations make purchases for the same basic reason. They buy goods and services that will help them meet the demand for the goods and services that they in turn supply to their markets.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

105. Which of the following is NOT true regarding organizational buyers?

A. Buyers for all kinds of organizations (governments, nonprofit groups, intermediaries) tend to buy in much the same way as do manufacturers.

 

B. The basic aspects of business customer buying behavior tend to be quite similar in the U.S. and in international markets.

 

C. Marketing strategies aimed at them are often tailored to each individual customer.

 

D. Their purchases are made to help their organizations meet the demands for their products.

 

E. Their needs are usually harder to define than for final consumers.

It is often easier to understand an organization’s needs because most organizations make purchases for the same basic reason. They buy goods and services that will help them meet the demand for the goods and services that they in turn supply to their markets.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Organizational Customers are Different
 

 

106. Organizational customers:

A. Purchase goods in order to satisfy their customers, but the services they purchase are for themselves.

 

B. Are more emotional in their buying than final consumers.

 

C. Try to consider the total cost of selecting a supplier, not just the initial cost of the product.

 

D. Typically focus on behavioral needs instead of economic factors in making purchases.

 

E. None of these alternatives is correct.

Buyers or organizational customers try to consider the total cost of selecting a supplier and its particular marketing mix, not just the initial price of one product.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

107. If a firm targets business and organizational markets,

A. the geographic location of the customer is likely to be less important than in segmenting consumer markets.

 

B. NAICS codes may help in segmenting manufacturers but not producers of services.

 

C. each customer may need to be treated as a different segment.

 

D. All of these alternatives are correct.

Small differences in buying behavior may be important because success often hinges on fine-tuning the marketing mix. Hence, each customer may need to be treated as a different segment.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

108. Organizational buying based on a written (or electronic) description of a product is called buying by ______________.

A. purchasing specifications

 

B. inspection

 

C. negotiated contract

Organizational buyers often buy on the basis of a set of purchasing specifications—a written (or electronic) description of what the firm wants to buy.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

109. _____ is a written or electronic description of what the firm wants to buy.

A. An estimate

 

B. A negotiated contract

 

C. A new market order

 

D. A purchase order

 

E. A set of purchasing specifications

Organizational buyers often buy on the basis of a set of purchasing specifications—a written (or electronic) description of what the firm wants to buy.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

110. A set of ________________ contains a written or electronic description of what a firm wants to buy.

A. requirements

 

B. purchasing specifications

 

C. blueprints

 

D. quality certifications

 

E. request forms

Organizational buyers often buy on the basis of a set of purchasing specifications—a written (or electronic) description of what the firm wants to buy.

 

AACSB: Technology
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

111. Purchasing specifications may include:

A. the product grade.

 

B. the brand name.

 

C. the part number.

 

D. All of these may be included in purchasing specifications.

When quality is highly standardized, as is often the case with manufactured items, the specification may simply consist of a brand name or part number.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

112. Purchasing specifications

A. may simply include a brand name or part number when purchasing requirements are complicated.

 

B. for services, as compared to goods, tend to be detailed because services are usually performed before they’re purchased.

 

C. for services, as compared to goods, tend to be detailed because services are more standardized than goods.

 

D. are often simple for manufactured items with highly standardized quality.

 

E. None of these alternatives is correct.

When quality is highly standardized, as is often the case with manufactured items, the specification may simply consist of a brand name or part number.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

113. Which of the following buying methods would a supermarket buyer be MOST LIKELY to use in the purchase of grade A large eggs?

A. Purchasing specifications

 

B. Competitive bidding

 

C. Negotiated contract

 

D. Complex buying

The supermarket buyer is specific about purchasing grade A large eggs. So, he is most likely to buy through purchasing specifications.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

114. Which of the following products would be bought using purchasing specifications?

A. 100 gallons of Du Pont brand muriatic acid.

 

B. 1,000 700MB CD-Rs.

 

C. 50 pounds of number 10 USX nails.

 

D. All of these products would be bought using purchasing specifications.

All of these are highly standardized products and can be bought using simple purchase specifications.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

115. Which of the following buying methods would a purchasing manager be most likely to use on the Internet?

A. Inspection

 

B. Negotiated contract

 

C. Purchasing specifications

 

D. Complex buying behavior

A purchasing manager is most likely to use purchasing specifications to buy on the Internet.

 

AACSB: Technology
Blooms: Apply
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

116. ____ is a way for a supplier to document its quality procedures according to internationally recognized standards.

A. ISO 2000

 

B. ISO 9000

 

C. QSO 3000

 

D. ISO 8000

 

E. QSO 3001

ISO 9000 is a way for a supplier to document its quality procedures according to internationally recognized standards.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 1 Easy
Topic: Organizational Customers are Different
 

 

117. Which of the following statements about ISO 9000 is NOT TRUE?

A. ISO 9000 is a way for a supplier to document its quality procedures according to internationally recognized standards.

 

B. ISO 9000 reassures a customer that the supplier has effective quality checks in place after it conducts a personal quality audit.

 

C. Some customers will not buy from a supplier who does not have ISO 9000 certification.

 

D. One requirement for ISO 9000 certification is that a company must show outside auditors who is responsible for quality every step of the way.

 

E. ISO 9000 helps organizational customers who are considering a new supplier.

ISO 9000 assures a customer that the supplier has effective quality checks in place, without the customer having to conduct its own costly and time-consuming audit.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 2 Medium
Topic: Organizational Customers are Different
 

 

118. Which of the following statements about ISO 9000 is FALSE?

A. ISO 9000 is a way for government suppliers to document their quality procedures, but it does not apply to other organizational suppliers.

 

B. A supplier that has met the ISO 9000 standard is always better than one that has not.

 

C. ISO 9000 applies to international suppliers only.

 

D. All of these statements are FALSE.

ISO 9000 is a way for all suppliers, domestic and international, to document their quality procedures according to internationally recognized standards. ISO 9000 assures a customer that the supplier has effective quality checks in place, without the customer having to conduct its own costly and time-consuming audit.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-01 Describe who the business and organizational buyers are.
Level of Difficulty: 3 Hard
Topic: Organizational Customers are Different
 

 

119. Buying specialists for organizations are commonly called:

A. supply agents.

 

B. vendor agents.

 

C. value analysts.

 

D. purchasing managers.

 

E. consumer buyers.

Many organizations rely on specialists to ensure that purchases are handled sensibly. They are commonly called purchasing managers—buying specialists for their employers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

120. For marketers who seek to sell to organizational customers, initial contact with the customer is likely to be with a customer’s:

A. most senior salesperson.

 

B. clerk who process paperwork.

 

C. purchasing manager.

 

D. accounting department.

 

E. Chief Executive Officer (CEO).

In large organizations, purchasing managers are the buying specialists that marketers must contact in order to present products and services. Purchasing managers typically work within a firm’s procurement department and have a lot of clout.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

121. Of the many people involved in making an organizational purchase, the one with the most power is usually the:

A. user.

 

B. influencer.

 

C. gatekeeper.

 

D. decider.

 

E. salesperson.

Deciders are the people in the organization who have the power to select or approve the supplier—often a purchasing manager but perhaps top management for larger purchases.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

122. After conducting a vendor analysis on potential suppliers, purchasing managers are likely to choose the vendor that:

A. enables the firm to operate more efficiently with the least risk.

 

B. offers the lowest priced goods and services.

 

C. offers the widest assortment of business products.

 

D. received the best rating from gatekeepers.

 

E. was the friendliest.

The purpose of a vendor analysis isn’t just to get a low price from the supplier on a given part or service. Rather, the goal is to lower the total costs associated with purchases as may be achieved through greater efficiencies. For example, analysis might show that the best vendor is the one that helps the customer reduce costs of excess inventory, retooling of equipment, or defective parts.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

123. Smart tips for selling to business customers include all the following except:

A. Emphasize various benefits that meet the differing needs and interests of each member of the buying center.

 

B. Offer fresh insight and ideas in e-mails and other correspondence.

 

C. Develop a marketing mix to satisfy the needs of the organization as well as the needs of individual purchasing managers.

 

D. Show appreciation by offering desirable gifts to purchasing managers.

 

E. Explain how products and services will reduce the firm’s risk.

Marketers must be very careful to abide by strict ethics, especially as it relates to gifts. Purchasing managers seek to avoid a conflict between their own self‐interest and company outcomes, and many firms have policies against employees accepting any gift from a supplier.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

124. A specialist within a company who is responsible for all of the company’s major purchases is called all of the following EXCEPT:

A. supply manager.

 

B. procurement officer.

 

C. buyer.

 

D. salesperson.

 

E. purchasing agent.

Many organizations rely on specialists to ensure that purchases are handled sensibly. These specialists have different titles in different firms, such as procurement officer, supply manager, purchasing agent, or buyer.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

125. A purchasing manager:

A. Is basically a clerk who fills out paperwork to place orders.

 

B. Is the only person a business-to-business salesperson ever needs to see in order to make a sale to a buying organization.

 

C. May specialize by product area if he/she works for a large organization.

 

D. Is only interested in finding the lowest possible price for a product.

 

E. All of these alternatives are correct.

Purchasing managers or buying specialists in large organizations usually specialize by product area and are real experts.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

126. Purchasing managers in business markets (compared to buyers in consumer markets) are generally:

A. fewer in number.

 

B. more technically qualified.

 

C. less emotional in their buying motives.

 

D. more insistent on dependability and quality.

 

E. All of these alternatives are correct.

Purchasing managers in business markets are fewer in number compared to buyers in consumer markets; they usually specialize by product area; are less emotional in their buying motives and are more insistent on dependability and quality.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

127. _____ are responsible for working with suppliers and arranging the terms of sale.

A. Gatekeepers

 

B. Deciders

 

C. Influencers

 

D. Users

 

E. Buyers

Buyers are responsible for working with suppliers and arranging the terms of sale.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

128. During the purchase of janitorial services for a new building, Teresa has responsibility for working with suppliers and arranging the terms of the sale. In this role, Teresa appears to be acting as

A. a gatekeeper.

 

B. a decider.

 

C. a buyer.

 

D. a user.

 

E. an influencer.

Buyers are responsible for working with suppliers and arranging the terms of sale. In this role, Teresa appears to be acting as a buyer.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

129. In a buying center, which of the following are likely to be influencers?

A. Purchasing managers who arrange the terms of the sale.

 

B. People who supply information for evaluating alternatives.

 

C. People who have the power to select or approve suppliers.

 

D. People who control the flow of information.

 

E. Purchasing managers who shield users or other deciders.

Influencers are, perhaps, engineering or R&D people who help write specifications or supply information for evaluating alternatives.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

130. In the purchase of a new computer monitor, which of the following is an example of a user?

A. A purchasing manager who arranges the terms of the sale.

 

B. An IT manager who supplies information for evaluating alternatives.

 

C. A secretary whose computer monitor is being replaced.

 

D. A receptionist who controls the flow of information.

 

E. A supply manager who helps write specifications.

Users are the people who will use the product being purchased.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

131. During the purchase of new tooling at Acme Tool and Die, which of the following is an example of a gatekeeper?

A. Sara, a purchasing manager, arranges the terms of the sale.

 

B. Ross, from research and development, supplies information for evaluating alternatives.

 

C. Charlotte, in manufacturing, has the power to select or approve suppliers.

 

D. Andre, a research assistant, gathers and distributes information about alternatives.

 

E. Rita, from the manufacturing floor, will use the new tooling.

Gatekeepers are people who control the flow of information within the organization. Andre, a research assistant who gathers and distributes information about alternatives is an example of a gatekeeper.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 3 Hard
Topic: Many Different People May Influence a Decision
 

 

132. Regarding organizational buying, the people who have the power to select or approve the supplier—especially for larger purchases—are called:

A. influencers.

 

B. deciders.

 

C. buyers.

 

D. gatekeepers.

 

E. users.

Deciders are the people in the organization who have the power to select or approve the supplier—often a purchasing manager but perhaps top management for larger purchases.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 3 Hard
Topic: Many Different People May Influence a Decision
 

 

133. ABC Technologies manufactures computer accessories, such as modems and network cards. Even though the company has several purchasing managers, the company president has final authority on all purchases over $500, including the selection of the supplier. In the typical buying center in this company, the company president would have the primary role of:

A. User.

 

B. Buyer.

 

C. Influencer.

 

D. Decider.

 

E. Gatekeeper.

Deciders are the people in the organization who have the power to select or approve the supplier—often a purchasing manager but perhaps top management for larger purchases. In this case, the president would be the decider.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

134. Natalie Simopoulos, director of procurement at Grecian Glass Company must approve every purchase order, and Anthony Markatos, purchasing manager, must authorize any sales rep who wants to talk to a Grecian Glass employee. Natalie and Anthony are acting as _____ and _____, respectively.

A. decider, gatekeeper

 

B. influencer, user

 

C. gatekeeper, influencer

 

D. buyer, decider

 

E. user, gatekeeper

Deciders are the people in the organization who have the power to select or approve the supplier and gatekeepers are people who control the flow of information within the organization. Natalie and Anthony are acting as decider and gatekeeper, respectively.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

135. A furniture producer has decided to buy its upholstery cloth from new suppliers. The president has given the purchasing manager responsibility to make the final selections and negotiate the terms. The purchasing manager looks through books with samples and specifications, and then calls salespeople to make presentations to the production manager, who is concerned about how easy the cloth will be to cut and sew. In this case, the purchasing manager is

A. an influencer.

 

B. a buyer.

 

C. a decider.

 

D. a gatekeeper.

 

E. All of these are correct.

The purchasing manager is playing the role of an influencer (looking through books with samples and preparing specifications), the role of a buyer (making the final selections and negotiating the terms), the role of a decider (selecting the supplier), and the role of a gatekeeper (calling the salespeople to make presentations to the production manager).

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

136. For new-task buying, a good salesperson will try to contact the potential customer’s:

A. deciders.

 

B. gatekeepers.

 

C. influencers.

 

D. buyers (purchasing managers).

 

E. All of these would be contacted for new-task buying.

New-task buying can involve setting product specifications, evaluating sources of supply, and establishing an order routine that can be followed in the future if results are satisfactory. Multiple buying influence (involving users, influencers, buyers, deciders, gatekeepers) is most often found in new-task buying.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

137. If many individuals are involved in a buying decision, this is:

A. a multiple input situation.

 

B. a selective rebuy.

 

C. a modified rebuy.

 

D. a multiple buying influence situation.

 

E. a straight rebuy.

Multiple buying influence involves users, influencers, buyers, deciders, gatekeepers in a buying decision.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

138. Multiple buying influence is MOST likely to occur in which of the following purchases?

A. Note pads.

 

B. A voice-mail phone system.

 

C. A replacement for a broken chair.

 

D. Gasoline.

 

E. Paper clips.

Purchasing of a voice-mail phone system involves a multiple buying influence. Note pads, a chair, gasoline, and paper clips, are standard products and can be bought by directly placing an order with simple specifications.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

139. A _____ refers to all of the people who participate in or influence a purchase.

A. procurement department

 

B. bidding group

 

C. set of gatekeepers

 

D. sales analysis group

 

E. buying center

A buying center includes all the people who participate in or influence a purchase. Different people may make up a buying center from one decision to the next.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

140. A “buying center”

A. may vary from purchase to purchase.

 

B. refers to all the purchasing agents in a large firm.

 

C. is usually identified on a firm’s organization chart.

 

D. is usually controlled by the purchasing manager.

 

E. is usually located in major wholesale markets.

A “buying center” may vary from purchase to purchase as different people make up a buying center from one decision to the next.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

141. When a salesperson calls on a new business prospect,

A. he may have trouble identifying all of the buying center members.

 

B. he usually must see the purchasing manager first.

 

C. the probability of encountering a gatekeeper is high.

 

D. All of these alternatives are correct.

When a salesperson calls on a new business prospect, he has to move through a proper channel, normally meeting each member of the buying center at different stages.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

142. Regarding organizational buying,

A. a “national accounts” sales force often makes sense when firms with many facilities buy from a central location.

 

B. purchasing managers are more likely to be found in large organizations.

 

C. a geographically bound salesperson can be at a real disadvantage.

 

D. All of these alternatives regarding organizational buying are true.

With centralized buying in large organizations, a sales rep may be able to sell to facilities all over a country; many large organizations rely on purchasing managers; a geographically bound salesperson can be at a real disadvantage as specific business customs vary from one country to another.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

143. Vendor analysis is a(n)

A. analytic processing of requests to buy something from a vendor.

 

B. formal rating of suppliers on all relevant areas of performance.

 

C. analytic processing of requests to sell something to a vendor.

 

D. request to buy something.

 

E. written description of what the firm wants to buy.

Vendor analysis is a formal rating of suppliers on all relevant areas of performance.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

144. Vendor analysis

A. ensures objectivity by disregarding whether a supplier has been used in the past.

 

B. emphasizes the emotional factors in a purchase decision.

 

C. is used less now that multiple buying influence is more common.

 

D. None of these alternatives is true.

In trying to deal with complexities arising while making purchase decisions many firms use vendor analysis—a formal rating of suppliers on all relevant areas of performance. The purpose isn’t just to get a low price from the supplier but also to lower the total costs associated with purchases.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

145. Vendor analysis:

A. Has the sole objective of getting the lowest possible price on a particular product or service from the supplier.

 

B. Does not take into account the behavioral needs of purchasing managers and others involved in the buying decision.

 

C. Is a formal rating of suppliers on all relevant areas of performance.

 

D. None of these alternatives about vendor analysis is correct.

In trying to deal with complexities arising while making purchase decisions many firms use vendor analysis—a formal rating of suppliers on all relevant areas of performance.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

146. When a company creates a rating form for its suppliers and rates their on-time delivery, product quality, service advice, and so forth, in order to determine which suppliers to put on an approved list of suppliers for specific products, this process is called a(n):

A. JIT rating.

 

B. resident buyer analysis.

 

C. vendor analysis.

 

D. ISO 9000 certification.

 

E. buying center analysis.

A formal rating of suppliers on all relevant areas of performance like on-time delivery, product quality, service advice, and so forth is called vendor analysis.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

147. Vendor analysis

A. emphasizes the emotional factors in a purchase decision.

 

B. is a formal procedure used by a vendor’s salespeople to be certain that all members of a buying center have been contacted.

 

C. is used less now that multiple buying influence is more common.

 

D. is likely to favor a vendor that offers the customer the lowest total cost associated with the purchase.

 

E. None of these alternatives about vendor analysis is true.

The purpose of vendor analysis isn’t just to get a low price from the supplier on a given part or service. Rather, the goal is to lower the total costs associated with purchases.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

148. The goal of vendor analysis is

A. just getting a low price from the supplier on a given part or service.

 

B. just satisfying the needs of the customer company.

 

C. lowering the total costs associated with purchases.

 

D. satisfying the needs of the individuals who influence the purchase.

 

E. focusing buyers and sellers on just the economic factors needed to reduce costs.

The goal of vendor analysis is to lower the total costs associated with purchases.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 3 Hard
Topic: Many Different People May Influence a Decision
 

 

149. Regarding selling to organizational buyers,

A. the buyer’s individual needs can be ignored when there is multiple buying influence.

 

B. purchasing managers are usually more emotional than final consumers.

 

C. a purchasing manager’s emotional needs should be emphasized as well as his economic needs.

 

D. sellers should try to avoid purchasing managers, since they usually can’t make the final buying decision.

 

E. All of these alternatives are correct.

Purchasing managers and others involved in buying decisions look forward to friendly relationships with suppliers. Hence, it becomes imperative for a sales person to balance a purchasing manager’s emotional needs and economic needs.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

150. A typical purchasing manager:

A. buys strictly on economic needs.

 

B. tries to satisfy both individual needs and company needs.

 

C. seeks the lowest possible cost.

 

D. has the final decision on all purchases.

 

E. All of these alternatives are correct.

A typical purchasing manager tries to satisfy both individual needs and company needs. A seller’s marketing mix should therefore satisfy both the needs of the customer company as well as the needs of individuals who influence the purchase.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

151. Purchasing managers

A. are, in general, not very well educated.

 

B. always buy from the lowest price supplier.

 

C. may be willing to pay more to reduce personal risk.

 

D. are usually the last ones a salesperson sees, after the order has been approved by the gatekeepers.

 

E. None of these alternatives for purchasing managers is correct.

For many purchases, buyers know that choosing a supplier that delivers poor quality or late deliveries can be very costly. Buyers always look towards avoiding personal risk.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

152. Most purchasing managers:

A. reject “vendor analysis” as too subjective.

 

B. want to be “sold” by persuasive salespeople.

 

C. spend most of their time on new-task buying.

 

D. stress dependability as well as lower cost and higher quality.

 

E. dislike the higher risk that is involved in buying from a supplier that meets the ISO 9000 standard.

Most purchasing managers make purchases from suppliers who deliver on time and with high-quality and keep the total costs associated with purchases low.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

153. Organizational buyers:

A. rely on many sources of information in addition to salespeople when making purchase decisions.

 

B. may use vendor analysis to make certain that all relevant areas of a purchase decision have been considered.

 

C. are likely to do little search for additional information if the purchase is unimportant.

 

D. tend to be more rational—and less emotional—in their buying decisions than final consumers.

 

E. All of these alternatives about organizational buyers are true.

Organizational buyers rely on many sources of information, perform vendor analysis, and focus on economic factors in order to make sensible buying decisions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

154. Organizational buyers:

A. are producers’ agents.

 

B. are problem solvers.

 

C. base purchasing decisions entirely on company needs.

 

D. are not affected by emotional needs.

 

E. All of these alternatives are correct.

Organizational buyers are problem solvers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

155. A requisition

A. is only used for nonroutine purchases.

 

B. is the same as a purchase order.

 

C. sets the terms under a negotiated contract.

 

D. is a formal contract between a buyer and a seller.

 

E. None of these choices is correct.

A requisition is a request to buy something.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

156. An office manager needs office supplies, so he fills out a form indicating what he needs and sends it to the purchasing department to be ordered. This form is usually called

A. a purchase order.

 

B. a requisition.

 

C. a vendor analysis.

 

D. a buying center request.

 

E. the start of the adoption process.

A person who needs to purchase something usually completes a requisition, a request to buy something.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

157. A person who needs to purchase something usually completes a

A. requisition.

 

B. supply form.

 

C. contract.

 

D. certificate of purchase.

 

E. vendor analysis.

A person who needs to purchase something usually completes a requisition, a request to buy something.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 1 Easy
Topic: Many Different People May Influence a Decision
 

 

158. All of the following are true of requisitions except

A. it is a request to buy something.

 

B. it is frequently handled online to cut time and paper shuffling.

 

C. its processing usually takes a few hours for both simple and complex purchases.

 

D. it is a form of centralized control.

The process of turning an authorization into a purchase order may take a few hours for a simple purchase but, for a complex purchase, it may take months.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-02 See why business and organizational purchase decisions often involve multiple influences.
Level of Difficulty: 2 Medium
Topic: Many Different People May Influence a Decision
 

 

159. Which of the following is NOT one of the organizational buying processes discussed in the text?

A. Multiple task buying.

 

B. Modified rebuy buying.

 

C. New-task buying.

 

D. Straight rebuy buying.

 

E. None of these, i.e., all are buying processes.

Multiple task buying is not discussed in the text.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

160. Once a suppler relationship has been established, purchases of the “straight rebuy” variety will most likely be transacted by:

A. a meeting with all buying center members.

 

B. a meeting with top executives only.

 

C. personal e-mails to the purchasing manager.

 

D. e-commerce computer systems.

 

E. phone.

E-commerce computer systems automatically handle a large portion of straight rebuys. Buyers program decision rules that tell the computer how to order and leave the details of following through to the computer.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

161. Sometimes suppliers take straight rebuy relationships for granted, which can:

A. lead to poor customer service.

 

B. create opportunities for competitors.

 

C. are reserved for short-term marketing relationships.

 

D. lead to new-task buying.

 

E. cause buyers to request routine information updates from suppliers.

Marketers sometimes get lazy enjoying an automated straight rebuy situation. As a result, straight rebuy relationships open the door for savvy competitors move in with a better marketing mix.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

162. Which of the following impersonal sources enable purchasing mangers to easily search for potential new suppliers?

A. Trade shows

 

B. Supplier Web sites

 

C. Consultants and outside experts

 

D. Salespeople

 

E. Special publicity features by local news reporters

Most purchasing managers start with an Internet search when they need to identify new suppliers, better ways to meet needs, or information to improve decisions. Buyers often rely on highly specialized search engines, which is also why many marketing managers will pay search engines for a sponsored link (an ad) that appears when certain keywords are included in a search.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

163. The situation that provides the greatest opportunity for suppliers that don’t currently serve a customer to develop inroads with a customer is the:

A. straight rebuy.

 

B. modified rebuy.

 

C. new-task buying.

 

D. virtual trade show.

 

E. competitive bid process.

New-task buying situations provide a good opportunity for a new supplier to make inroads with a customer.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

164. Which of the following is NOT one of the organizational buying processes discussed in the text?

A. Straight rebuy buying

 

B. Modified rebuy buying

 

C. Important task buying

 

D. New-task buying

 

E. None of these, i.e., all are buying processes.

Important task buying is not discussed in the text.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

165. Multiple buying influence should be expected in:

A. vendor buying.

 

B. straight rebuy buying.

 

C. modified rebuy buying.

 

D. new-task buying.

 

E. None of these alternatives is correct.

Multiple buying influence is most often found in new-task buying.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

166. Regarding new-task organizational buying, which of the following are likely to be involved?

A. Top managers.

 

B. Purchasing manager.

 

C. Production process engineers.

 

D. Production line supervisors.

 

E. All of these are likely to be involved in new-task organizational buying.

Multiple buying influence is most often found in new-task buying. Multiple buying influence involves top managers (deciders), purchasing manager (buyers), production process engineers (influencers), production line supervisors (users).

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

167. Regarding new-task organizational buying, which of the following persons is LEAST likely to be involved?

A. A competitor’s purchasing manager.

 

B. A purchasing manager.

 

C. A production line supervisor.

 

D. The company president.

 

E. A research assistant.

A competitor’s purchasing manager would not be involved.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

168. New-task buying

A. is a routine repurchase that may have been made many times before.

 

B. occurs when an organization has a new need and the customer wants a great deal of information.

 

C. is an in-between process where some review of the buying situation is done.

 

D. occurs when an organization has a routine need and the customer wants only minimal information.

 

E. involves no review of suppliers.

New-task buying occurs when a customer organization has a new need and wants a great deal of information. It involves setting product specifications, evaluating sources of supply, and establishing an order routine that can be followed in the future if results are satisfactory.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

169. A buyer who has not purchased from a vendor in the past is MOST LIKELY to buy from that vendor when there is:

A. straight rebuy buying.

 

B. selective buying.

 

C. new-task buying.

 

D. selective task buying.

 

E. modified rebuy buying.

New-task buying situations provide a good opportunity for a new supplier to make in roads with a customer.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

170. Which of the following buying situations gives a seller the most chance for promotion impact?

A. Selective task buying

 

B. Modified rebuy buying

 

C. New-task buying

 

D. Straight rebuy buying

 

E. All of these buying situations are equal.

New-task buying situations provide a good opportunity for a new supplier to make inroads with a customer. With a buyer actively searching for information, the seller’s promotion has a much greater chance of being noticed and having an impact.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

171. For which of the following would an organization most likely engage in new task buying?

A. A small portable welding machine for use in making repairs.

 

B. A new desktop copying machine.

 

C. Dishwashing detergent for use in a restaurant.

 

D. A new desk chair to replace one that had broken.

 

E. A 10,000 square foot prefabricated steel building for use as a warehouse.

The organization would most likely engage in new task buying of a 10,000 square foot prefabricated steel building for use as a warehouse. The task would require a multiple buying influence.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

172. When a company is trying to decide which type of smartphone to purchase for its sales staff and has never had to make that specific type of purchase before, this buying situation is called a(n):

A. Straight rebuy.

 

B. New-task buy.

 

C. JIT buy.

 

D. Modified rebuy.

 

E. ISO 9000 buy.

New-task buying occurs when a customer organization has a new need and wants a great deal of information.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Organizational Buyers Are Problem Solvers
 

 

173. Sweets Galore, the manufacturer of Rainbow brand lollipops, decided to expand into manufacturing liqueur-filled chocolate truffles. Its buying process for the chocolates, liqueurs, and molds was extensive, and included setting product specifications and evaluating sources of supply. This is an example of a

A. straight buy.

 

B. modified rebuy.

 

C. straight rebuy.

 

D. new-task buy.

 

E. simplified rebuy.

New-task buying occurs when a customer organization has a new need and wants a great deal of information. New-task buying can involve setting product specifications and evaluating sources of supply.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

174. Definitely Scrumptious Co., a cookie manufacturer, decides to expand into cake manufacturing. It begins the buying process for cake molds, toppings, and icing equipment by setting product specifications and evaluating sources of supply. This is an example of a

A. simplified buy.

 

B. straight rebuy.

 

C. modified rebuy.

 

D. straight buy.

 

E. new-task buy.

New-task buying occurs when a customer organization has a new need and wants a great deal of information. New-task buying can involve setting product specifications and evaluating sources of supply.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

175. Straight rebuy

A. decisions, as contrasted with modified rebuys, are more likely to involve multiple buying influence.

 

B. vendor selections are likely to be made by a purchasing manager—without consulting anyone else.

 

C. decisions are infrequent, but they typically take longer to make than new-task buying decisions.

 

D. decisions usually involve getting negotiated bids from suppliers.

 

E. decisions cannot be influenced by advertising.

A straight rebuy is a routine repurchase that may have been made many times before. Buyers probably don’t bother looking for new information or new sources of supply.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 3 Hard
Topic: Organizational Buyers Are Problem Solvers
 

 

176. A straight rebuy is MOST likely to occur for:

A. a new computer network.

 

B. a pension plan which meets the new government regulations.

 

C. paper supplies for the copy equipment.

 

D. electronic components for a new product.

 

E. executive chairs for a new office building.

A straight rebuy is most likely to occur for paper supplies for the copy equipment as it is a routine repurchase.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

177. A vendor is MOST likely to make a sale if the buyer has bought from the vendor before and is doing:

A. straight rebuy buying.

 

B. selective buying.

 

C. multiple task buying.

 

D. modified rebuy buying.

 

E. new-task buying.

A vendor is most likely to sell to the buyer who has bought from the vendor before and is doing a straight rebuy as it would be a routine repurchase.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

178. A vendor is LEAST LIKELY to make a sale if the buyer has not bought from the vendor before and is doing:

A. straight rebuy buying.

 

B. selective buying.

 

C. new-task buying.

 

D. selective task buying.

 

E. modified rebuy buying.

A vendor is least likely to sell to the buyer who has not bought from the vendor before and is doing a straight rebuy as it is a routine repurchase and there is no reason for the buyer to seek new information or new sources of supply.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

179. A straight rebuy

A. involves setting product specifications and evaluating sources of supply.

 

B. occurs when an organization has a new need and the customer wants a great deal of information.

 

C. is an in-between process where some review of the buying situation is done.

 

D. occurs when an organization has a new need but the customer wants only minimal information.

 

E. is a routine repurchase that may have been made many times before.

A straight rebuy is a routine repurchase that may have been made many times before.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

180. Organizational buyers:

A. tend to rely almost totally on salespeople as their source of information.

 

B. prefer formal procedures for rating vendors over informal approaches like vendor analysis.

 

C. are likely to do little search for additional information if the purchase is unimportant.

 

D. tend to be more emotional than final consumers—because their jobs are at risk if a problem arises.

 

E. None of these alternatives is correct.

How much information a customer collects depends on the importance of the purchase and the level of uncertainty about what choice might be best. The time and expense of searching for information may not be justified for a minor purchase.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

181. Percy Malik, purchasing agent for Black Mountain Chemical Industries, routinely signs purchase orders for office supplies without further consideration. At Black Mountain, purchases of office supplies are

A. a modified rebuy.

 

B. a necessity.

 

C. Somewhat Insignificant Commodity (SIC) items.

 

D. a selective rebuy.

 

E. a straight rebuy.

Percy Malik routinely signs purchase orders for office supplies. So, it is a straight rebuy. A straight rebuy is a routine repurchase that may have been made many times before.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

182. A sales representative calls on a prospective business customer only to find that the customer has an established relationship with another supplier that seems to be working well. The customer is not interested in considering other suppliers. The customer is currently in a ____________________ situation.

A. straight rebuy

 

B. modified rebuy

 

C. new-task

 

D. extensive problem-solving

 

E. limited problem-solving

The customer is currently in a straight rebuy situation. As the customer already has an established relationship with another supplier, the customer is not looking for new information or new sources of supply.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

183. Home Sweet Home Co. manufactures and sells handmade wooden furniture. Its manager routinely orders 50 cartons of Supreme Furniture Polish and 10 bottles of Ultra Sheen Varnish from the same vendor. This is an example of a

A. straight buy.

 

B. modified rebuy.

 

C. new-task buy.

 

D. straight rebuy.

 

E. simplified buy.

This is an example of a straight rebuy as the manager makes routine repurchases. A straight rebuy is a routine repurchase that may have been made many times before.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

184. Circle Z Tires is a retailer of car tires. Unless the store manager requests something different, every month there is an automatic order of 10 XZ Performance Tires and 12 J-1 wheels from Box Tire Supply. This is an example of a

A. new-task buy.

 

B. modified rebuy.

 

C. straight rebuy.

 

D. modified buy.

 

E. simplified buy.

This is an example of a straight rebuy as there is a routine order made. A straight rebuy is a routine repurchase that may have been made many times before.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

185. Rosalinda’s Steak House purchases 70 T-bone steaks every Friday—including last Friday. Last Friday’s order was an example of a

A. straight buy.

 

B. modified rebuy.

 

C. new-task buy.

 

D. straight rebuy.

 

E. simplified buy.

Last Friday’s order was an example of a straight rebuy as there is a routine order made on the following Friday as well.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 3 Hard
Topic: Organizational Buyers Are Problem Solvers
 

 

186. A purchase having some multiple influence and requiring some information would fit the description of a

A. new-task buy.

 

B. modified buy.

 

C. straight rebuy.

 

D. modified rebuy.

 

E. simplified buying.

Modified rebuy is the in-between process where some review of the buying situation is done though not as much as in new-task buying.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

187. A modified rebuy would be most likely when:

A. A railroad plans to change from steel to aluminum rail cars to cut weight.

 

B. A car producer is developing a sportier car which will require wider tires.

 

C. A bread producer is placing its weekly order for flour.

 

D. A computer producer is buying new assembly line equipment.

 

E. A shoe factory needs more glue to attach heels to its shoes.

A modified rebuy would be most likely when a car producer is developing a sportier car which will require wider tires. In this case, the purchase specifications would require some review and modifications.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Organizational Buyers Are Problem Solvers
 

 

188. A modified rebuy is MOST likely to occur for:

A. file folders.

 

B. brooms.

 

C. paper clips.

 

D. a desk.

 

E. copier paper.

A modified rebuy is most likely to occur for the purchase of a desk. The purchase specifications may require some review and modification.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

189. Whitewater Corp. is looking for a new vendor for basic plastics because the present vendor has been inconsistent about meeting delivery schedules. Which of the following buying processes is the firm’s purchasing agent MOST LIKELY to use?

A. Selective buying

 

B. Modified rebuy buying

 

C. Intensive buying

 

D. New-task buying

 

E. Straight rebuy buying

Whitewater Corp. already has the purchase specifications and only needs to look for a new supplier of basic plastics. So, the firm’s purchasing agent is most likely to use modified rebuying.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 2 Medium
Topic: Organizational Buyers Are Problem Solvers
 

 

190. In his last order, the bakery manager at Bread of the Earth Bakery purchased a different brand of whole wheat flour from his regular supplier, Best Bakery Supplies. This is an example of a

A. modified rebuy.

 

B. straight buy.

 

C. straight rebuy.

 

D. new-task buy.

 

E. simplified buy.

The bakery manager bought a different brand of wheat flour but from the regular supplier. So, this is an example of a modified rebuy. Modified rebuy is the in-between process where some review of the buying situation is done though not as much as in new-task buying.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 3 Hard
Topic: Organizational Buyers Are Problem Solvers
 

 

191. Purchasing managers rely on Internet ______________ ______________ to quickly identify new supplies.

A. Procurement engines

 

B. Online communities

 

C. Purchasing sites

 

D. Search engines

Most purchasing managers start with an Internet search when they need to identify new suppliers.

 

AACSB: Technology
Blooms: Apply
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

192. A report on a seller’s website that describes how an organizational buyer can make a better decision on a particular topic is called a(n):

A. mission statement.

 

B. white paper.

 

C. executive summary.

 

D. online community.

 

E. outsource.

White papers are reports designed to help buyers make decisions about a particular topic.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

193. A report on a seller’s website that describes how one of its customers solved a specific problem by using the seller’s products is called a(n):

A. white paper.

 

B. outsource.

 

C. executive summary.

 

D. case study.

 

E. mission statement.

Buyers like to read case studies, reports on a seller’s website that describe how other companies solved a specific problem by using the seller’s products.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Organizational Buyers Are Problem Solvers
 

 

194. _______ are the terms of sale offered by different suppliers in response to the purchase specifications posted by the buyer.

A. Competitive bids

 

B. Purchasing rebuys

 

C. Legal bonds

 

D. Requisitions

 

E. Auctions

Competitive bids are the terms of sale offered by different suppliers in response to the purchase specifications posted by the buyer.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 1 Easy
Topic: Organizational Buyers Are Problem Solvers
 

 

195. Charles Wood, purchasing manager for a company that makes golf carts, posted the purchase specifications for the seats on a new golf cart model his firm is building. Four suppliers submitted _____ that included the terms of sale each had to offer.

A. operational linkages

 

B. an auction

 

C. negotiated contracts

 

D. competitive bids

 

E. defined sales procedures

Four suppliers submitted competitive bids that included the terms of sale each had to offer. Competitive bids are the terms of sale offered by different suppliers in response to the purchase specifications posted by the buyer.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-03 Understand the problem-solving behavior of organizational buyers and how they get market information.
Level of Difficulty: 3 Hard
Topic: Organizational Buyers Are Problem Solvers
 

 

196. Which of the following statements about close buyer-seller relationships in business markets is False?

A. In close relationships, buyers and suppliers can share tasks at a lower total cost of doing business.

 

B. The buyer can gain a more dependable source of supply.

 

C. Buyers and suppliers can engage in joint problem solving.

 

D. Long-term commitments on larger order quantities often cause the supplier to raise its selling price.

 

E. None of these statements is False.

Long-term commitments on larger order quantities would likely cause the supplier to lower its selling price, not raise it.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

197. Which dimension of buyer-seller relationships most significantly increases the risk that proprietary knowledge or trade secrets may leak to competitors or the public?

A. Cooperation

 

B. Information sharing

 

C. Operational linkages

 

D. Legal bonds

 

E. Relationship-specific adaptations

Some relationships involve open sharing of information, whether by discussions between personnel or through information systems connected via the Internet-a key facet of B2B e-commerce. However, firms resist sharing information if there’s a risk that a partner might misuse it.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

198. The method by which suppliers provide deliveries to organizations precisely when the buyer needs them (“just in time”) involves this dimension of buyer-seller relationships:

A. cooperation.

 

B. information sharing.

 

C. operational linkages.

 

D. legal bonds.

 

E. relationship-specific adaptations.

By establishing operational linkages with suppliers, organizations can receive material precisely on time. This technique can reduce total inventory costs, maintain adequate inventory levels, and keep production lines moving.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

199. In business markets, close buyer-seller relationships

A. may improve the profits of both the buyer and the seller.

 

B. are almost always desirable from the seller’s point of view, but not from the buyer’s point of view.

 

C. may have benefits, but they usually increase a firm’s uncertainty and risk.

 

D. None of these alternatives is correct.

Closely tied firms often share tasks at lower total cost than would be possible working at arm’s length. Lower total costs lead to greater profits.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 3 Hard
Topic: Buyer-Seller Relationships in Business Markets
 

 

200. Close buyer-seller relationships may not make sense because:

A. Flexibility may be reduced for the firms involved.

 

B. Not all purchases are important enough to the buyer to justify a close relationship with a supplier.

 

C. Some suppliers do not want to deal with buyers who place small orders.

 

D. There are situations when the buyer could get reduced prices by letting suppliers compete for the buyer’s business.

 

E. All of these are correct.

Although close buyer-seller relationships can produce benefits, they are not always best. All of the drawbacks listed above substantiate this statement.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

201. With respect to buyer-seller relationships in business markets,

A. relationships benefit sellers, but not customers.

 

B. some customers simply are not interested in a close relationship with a supplier.

 

C. customer firms are better off selecting suppliers with competitive bids rather than establishing a relationship with a single vendor.

 

D. None of these alternatives is true.

Some customers simply are not interested in a close relationship with a supplier because it may not be worth the customer’s investment to build a relationship for purchases that are not particularly important or made that frequently.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

202. All of the following are key dimensions of relationships in business markets EXCEPT:

A. cooperation.

 

B. information sharing.

 

C. operational linkages.

 

D. non-specific adaptations.

 

E. legal bonds.

The five key dimensions that help characterize most buyer-seller relationships are cooperation, information sharing, operational linkages, legal bonds, and relationship-specific adaptations.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

203. Which of the following is NOT a key dimension of buyer-seller relationships in business markets?

A. legal bonds

 

B. new-task sharing

 

C. cooperation

 

D. operational linkages

 

E. information sharing

The five key dimensions that help characterize most buyer-seller relationships are cooperation, information sharing, operational linkages, legal bonds, and relationship-specific adaptations.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

204. Which of the following is NOT a key dimension of buyer-seller relationships in business markets?

A. Information sharing

 

B. Legal bonds

 

C. Cooperation

 

D. Operational linkages

 

E. All of these are key dimensions

The five key dimensions that help characterize most buyer-seller relationships are cooperation, information sharing, operational linkages, legal bonds, and relationship-specific adaptations.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

205. Which of the following is NOT a key dimension of buyer-seller relationships in business markets?

A. legal bonds

 

B. relationship-specific adaptations

 

C. joint inspection

 

D. operational linkages

 

E. information sharing

The five key dimensions that help characterize most buyer-seller relationships are cooperation, information sharing, operational linkages, legal bonds, and relationship-specific adaptations.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

206. Which of the following is NOT a key dimension of buyer-seller relationships in business markets?

A. legal bonds

 

B. relationship-specific adaptations

 

C. cooperation

 

D. operational linkages

 

E. bid rigging

The five key dimensions that help characterize most buyer-seller relationships are cooperation, information sharing, operational linkages, legal bonds, and relationship-specific adaptations.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

207. Which of the following is NOT a key dimension of buyer-seller relationships in business markets?

A. legal bonds

 

B. relationship-specific recycling

 

C. cooperation

 

D. operational linkages

 

E. information sharing

The five key dimensions that help characterize most buyer-seller relationships are cooperation, information sharing, operational linkages, legal bonds, and relationship-specific adaptations.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

208. Which of the following is NOT a key dimension of buyer-seller relationships in business markets?

A. Competition.

 

B. Information sharing.

 

C. Relationship-specific adaptations.

 

D. Operational linkages.

 

E. Legal bonds.

The five key dimensions that help characterize most buyer-seller relationships are cooperation, information sharing, operational linkages, legal bonds, and relationship-specific adaptations.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

209. Suppliers to business markets often

A. provide information about industry trends.

 

B. must manage inventory and delivery carefully—to provide customers with just-in-time delivery.

 

C. serve as technical consultants to their customers.

 

D. may have to agree to contracts that allow for changes in the purchase arrangements.

 

E. All of these choices are correct.

Suppliers to business markets often share information on industry trends with the customer, provide just-in-time delivery, serve as technical consultants to their customers, and agree to negotiated contract buying.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

210. A close buyer-seller relationship in a business market:

A. may require relationship-specific adaptations by the seller, the customer, or both.

 

B. may result in the seller accepting a lower price.

 

C. may increase the buyer’s “switching costs.”

 

D. may not involve a contract that spells out each party’s responsibilities.

 

E. All of these may be part of a close buyer-seller relationship.

A close buyer-seller relationship in a business market may require relationship-specific adaptations by both parties, obligatory price reductions by the supplier, obligatory switching costs for the buyer, and negotiated contract buying.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 3 Hard
Topic: Buyer-Seller Relationships in Business Markets
 

 

211. Operational linkages are

A. direct ties between the internal operations of buyer and seller firms.

 

B. changes in a firm’s product or procedures that are unique to its relationship partner.

 

C. connections that outline contractual obligations.

 

D. services that link a buyer’s production and purchasing departments.

Operational linkages are direct ties between the internal operations of the buyer and seller firms.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

212. Which of the following statements about operational linkages is FALSE?

A. Just-in-time is an example of an operational linkage.

 

B. Operational linkages are direct ties between the internal operations of the buyer and seller firms.

 

C. Operational linkages involve only occasional coordination of activities between buying and selling firms.

 

D. None of these statements about operational linkages is FALSE.

Operational linkages usually involve ongoing coordination of activities between the firms.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 3 Hard
Topic: Buyer-Seller Relationships in Business Markets
 

 

213. _____ refers to reliably getting products there exactly before the customer needs them.

A. Total quality shipping

 

B. Effective gatekeeping

 

C. Just-in-time delivery

 

D. On-time vendor management

 

E. Assured outsourcing

Just-in-time delivery means reliably getting products there just before the customer needs them.

 

AACSB: Analytic
AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

214. When a purchasing manager knows roughly what is needed but can’t describe it exactly—or when the purchasing arrangement may change as the job progresses—then buying is likely to be by:

A. negotiated contract.

 

B. description.

 

C. inspection.

Negotiated contract buying means agreeing to contracts that allow for changes in the purchase arrangements. In such cases, the general project and basic price is described but with provision for changes and price adjustments as the job progresses.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

215. Today, when a buyer can’t specify all of the details of what it will need in the future, the relationship with a supplier is most likely to involve:

A. an auction.

 

B. a procurement hub.

 

C. negotiated contracts.

 

D. competitive bids.

 

E. All of these are likely to be involved.

When a buyer can’t specify all of the details of what it will need in the future, the relationship with a supplier is most likely to involve negotiated contracts.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Buyer-Seller Relationships in Business Markets
 

 

216. Creative Electronics has an idea for a new MP3 accessory. Now it is looking for a supplier to design and manufacture the product. It will most likely use ______________ buying.

A. description

 

B. negotiated contract

 

C. inspection

Creative Electronics only has an idea for a new MP3 accessory and not a detailed description of it. So, it is most likely to use negotiated contract buying. Negotiated contract buying means agreeing to contracts that allow for changes in the purchase arrangements.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

217. When a large aircraft manufacturer like Boeing obtains a contract to build a new type of jet airliner, this transaction is most likely a(n):

A. Negotiated contract buy

 

B. Straight rebuy

 

C. Modified rebuy

 

D. ISO 9000 buy

 

E. JIT buy

The transaction is a negotiated contract buy as the contract is likely to contain only the general project and basic price details with provision for changes as the job progresses.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

218. Rico Paving Contractors enters into a contract with Valley Supply for the purchase of 100 bags of cement per week for the next 16 weeks at a price of $15 per bag. The contract also includes a condition that allows prices to be revised if costs go up more than $1 per bag. This purchase involves

A. an indefinite delivery contract.

 

B. negotiated contract buying.

 

C. a good faith purchase.

 

D. cost reimbursement contracting.

 

E. price allocation purchasing.

This purchase involves negotiated contract buying as the contract includes a provision for price changes over a specific period of time. Negotiated contract buying means agreeing to contracts that allow for changes in the purchase arrangements.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 3 Hard
Topic: Buyer-Seller Relationships in Business Markets
 

 

219. A catalog merchant wants to build a new distribution center that will improve inventory management, storage of products, shipping, and returns. The company develops a close relationship with UPS, its main supplier of shipping services. UPS helps the catalog merchant design its new distribution center so that it coordinates well with the shipping processes at UPS. This arrangement reduces shipping costs and improves service to the catalog merchant’s customers. This situation is an example of:

A. Information sharing.

 

B. Negotiated contract buying.

 

C. Legal bonds.

 

D. Competition.

 

E. Relationship-specific adaptations.

As the two companies work in close cooperation with each other this situation is an example of relationship-specific adaptations. Relationship-specific adaptations involve changes in a firm’s product or procedures that are unique to the needs or capabilities of a relationship partner.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 1 Easy
Topic: Buyer-Seller Relationships in Business Markets
 

 

220. Chu’s Coating Services, a painting company, designs a set of four paint colors that will only be used by custom motorcycle maker Walker County Choppers. This decision is an example of

A. competitive bidding.

 

B. just-in-time delivery.

 

C. insourcing.

 

D. operational linkages.

 

E. a relationship-specific adaptation.

Chu’s Coating Services is providing customized services to Walker County Choppers, which is a relationship-specific adaptation. Relationship-specific adaptations involve changes in a firm’s product or procedures that are unique to the needs or capabilities of a relationship partner.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

221. Specific adaptations are usually required when a buyer chooses _____, which is a contract with an external firm to produce goods or services rather than the buyer producing them internally.

A. gatekeeping

 

B. resident buying

 

C. competitive bidding

 

D. outsourcing

 

E. auctioning

Specific adaptations are usually made when the buying organization chooses to outsource—contract with an outside firm to produce goods or services rather than to produce them internally.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 2 Medium
Topic: Buyer-Seller Relationships in Business Markets
 

 

222. Organizational buyers purchase the same product from more than one source

A. if no supplier has a superior marketing mix.

 

B. to help ensure continuing supplies.

 

C. because a single vendor usually doesn’t want all of the business.

 

D. if vendor analysis results in a “tie score” for the different suppliers.

 

E. None of these is true.

Buyers often look for several dependable sources of supply to ensure continued supplies and also to protect themselves from unpredictable events.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-04 Understand the different types of buyer-seller relationships and their benefits and limitations.
Level of Difficulty: 3 Hard
Topic: Buyer-Seller Relationships in Business Markets
 

 

223. Regarding the size of manufacturing concerns, large firms (with more than 250 employees)

A. outnumber small firms more than two to one.

 

B. account for nearly half of all the manufacturing establishments.

 

C. are few in number but their employees account for about 44 percent of production workers.

 

D. provide no more “value added” than the many small firms.

 

E. None of these alternatives is true.

In the United States, only about 3 percent of all manufacturing plants have 250 or more employees, yet they employ about 44 percent of the production workers. Exhibit 6-6 presents data on size distribution of manufacturing establishments in the United States.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

224. All of the following statements about manufacturers are accurate except:

A. large manufacturers are few in number yet produce the highest percentage of value added within the manufacturing industry.

 

B. most U.S. factories operate in large metropolitan areas.

 

C. the greatest growth in manufacturing has occurred in countries where labor is cheap.

 

D. NAICS codes help marketers classify different types of manufacturing businesses.

 

E. manufacturing output in the United States is shrinking.

While it is true that the number of people employed in manufacturing has been shrinking, U.S. manufacturing output is higher than at any other time in the nation’s history.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

225. Which of the following is not a key variable that marketers need to consider when developing marketing mixes for manufacturers?

A. Size of manufacturers

 

B. CEOs of manufacturers

 

C. Geographic location of manufacturers

 

D. Buying procedures of manufacturers

 

E. Classifications of manufacturers

To help develop effective marketing mixes, marketers should pay close attention to the size, geographic locations, buying procedures, and types of manufacturers.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

226. When referencing NAICS codes, marketers should know that:

A. two-digit industries are subindustries of the three-digit industries.

 

B. two-digit codes offer the broadest categorization of industries.

 

C. categories become less detailed as you move to codes with more digits.

 

D. the international version of the NAICS system is the most accurate and reliable.

 

E. NAICS codes provide detailed information about the apparel industry only.

NAICS codes help categorize all types of businesses and begin by listing general industry categories, which are marked by two-digit codes. Subcategories of those top-level groupings then receive codes of three or more digits, signifying greater detail about the products and services offered by firms.

 

AACSB: Analytic
Blooms: Analyze
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

227. Which of the following tips would help marketers find new B2B clients that are similar to clients they already serve?

A. Ask a current customer to help identify new leads.

 

B. Look up firms that use automated systems for straight rebuying.

 

C. Conduct a vendor analysis.

 

D. Identify current customers’ NAICS codes and then look at NAICS-coded lists for related firms.

 

E. Research ISO 9000 certified companies.

Marketers can find firms that are similar to current B2B-market clients by looking up current customers’ NAICS codes and then studying NAICS-coded lists for related firms.

 

AACSB: Analytic
Blooms: Analyze
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

228. Regarding the manufacturers’ market, large firms (with more than 250 employees)

A. account for the majority of the total “value added” by all manufacturers.

 

B. are very few compared to the many small firms.

 

C. employ about 44 percent of all people employed in manufacturing.

 

D. All of these alternatives are true.

In the United States, only about 3 percent of all manufacturing plants have 250 or more employees, yet they employ about 44 percent of the production workers and produce about 58 percent of the value added by manufacturers. Exhibit 6-6 presents data on size distribution of manufacturing establishments in the United States.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Manufacturers Are Important Customers
 

 

229. Regarding the business (manufacturing) market, small firms (with fewer than 10 employees)

A. are not very numerous compared to the very large firms.

 

B. account for the vast majority of the total employment provided by all manufacturers.

 

C. are the majority of all firms, but account for less than 3 percent of “value added” by manufacturing.

 

D. amount to nearly two million establishments.

 

E. None of these alternatives is true.

In the United States, there are about 330,000 factories. Majority of these are quite small—over half have less than 10 workers. But output from these small firms accounts for less than 3 percent of manufacturing value.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 3 Hard
Topic: Manufacturers Are Important Customers
 

 

230. Regarding the market composed of manufacturers in the United States:

A. Most manufacturers are quite large.

 

B. Manufacturers tend to be concentrated in specific areas.

 

C. There are a large number of manufacturers compared to the number of final consumers.

 

D. Small manufacturers account for most of the “value added” by manufacturing.

 

E. All of these alternatives are correct.

Within a country, there is often concentration of manufacturing in specific areas. In the United States, many factories are concentrated in big metropolitan areas—especially in New York, Pennsylvania, Ohio, Illinois, Texas, and California.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

231. Which of the following statements about manufacturers is true?

A. Most manufacturers have more than 50 employees.

 

B. Small manufacturer with less than 50 employees account for half of the total dollar value added.

 

C. Small manufacturers now have purchasing procedures just as formal as large manufacturers.

 

D. Manufacturers with less than 50 employees have more employees overall than manufacturers with 50 or more employees.

 

E. Marketers often segment industrial markets on the basis of customer size.

Marketers often segment industrial markets on the basis of customer size because large firms do so much of the buying.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 3 Hard
Topic: Manufacturers Are Important Customers
 

 

232. Which of the following statements about manufacturers is true?

A. Industrial customers are concentrated in countries that are at the more advanced stages of economic development.

 

B. Manufacturing output in the U.S. is shrinking.

 

C. Countries with cheap labor have a slow rate of growth.

 

D. Many factories are concentrated in rural areas of the U.S.

 

E. Currently, U.S. manufacturing output is at its lowest point since 1980.

Internationally, industrial customers are concentrated in countries that are at the more advanced stages of economic development.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

233. In the U.S., what percentage of total dollar value added by manufacturing comes from large manufacturers employing 250 or more employees?

A. Just under 40 percent

 

B. Almost 60 percent

 

C. About 30 percent

 

D. Less than 5 percent

 

E. More than 80 percent

Manufacturers which employ 250 or more employees produce about 58 percent of the value added by manufacturers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 3 Hard
Topic: Manufacturers Are Important Customers
 

 

234. U.S. business manufacturing markets tend to be concentrated:

A. by industry.

 

B. with a relatively few large manufacturing plants.

 

C. by geographical location.

 

D. All of these are correct.

U.S. business manufacturing markets tend to be concentrated by industry type, industry size, and geographical location.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

235. U.S. manufacturers:

A. all employ many workers.

 

B. are evenly spread throughout the country.

 

C. tend to concentrate by industry.

 

D. do not locate close to competitors.

 

E. None of these alternatives is correct.

U.S. manufacturers tend to concentrate by industry. For example, U.S. manufacturers of high-tech electronics are concentrated in California’s famous Silicon Valley near San Francisco and also along Boston’s Route 128.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

236. If a firm targets business and organizational markets,

A. NAICS codes may be helpful for segmenting potential customers.

 

B. each customer may need to be treated as a different segment.

 

C. competing manufacturers are often clustered in geographic locations.

 

D. All of these alternatives are true.

A firm targeting business and organizational markets can identify potential customers from different segments through North American Industry Classification System code number. Each business customer may need to be treated as a different segment. Most competing manufacturers tend to be clustered in geographic locations based on industry type.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Manufacturers Are Important Customers
 

 

237. The U.S. government collects and publishes data by _____ codes—groups of firms in similar lines of business.

A. JIT

 

B. MFG LIST

 

C. PRIZM USA

 

D. NAPCS

 

E. NAICS

The U.S. government collects and publishes data by the North American Industry Classification System (NAICS) codes—groups of firms in similar lines of business.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

238. “NAICS” means:

A. North American Initiative for Competitive Structure.

 

B. North American Industry Classification System.

 

C. New Auto Industry Classification System.

 

D. National Automakers Industry Classification System.

 

E. National Apparel Industry Classification System.

NAICS stands for North American Industry Classification System.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

239. When looking at NAICS codes:

A. The fewer numbers in the code, the more general the industry classification is.

 

B. The more numbers in the code, the more general the industry classification is.

 

C. The fewer numbers in the code, the more specific the industry classification is.

 

D. The United States is the only country to collect data that groups firms in similar lines of business.

 

E. None of these alternatives is correct.

The NAICS code breakdowns start with broad industry categories with two digit codes. Within each two-digit industry breakdown, much more detailed data may be available for three-digit industries. Exhibit 6-7 illustrates that breakdowns are more detailed as you move to codes with more digits.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

240. You have just been asked by your manager to compile data on firms in California that have a specific 4-digit NAICS code. You should know

A. that there are no 4-digit NAICS codes.

 

B. that there is only one firm to find, since each firm has its own 4-digit NAICS code.

 

C. that it is possible that no data will be available, even if there is one large firm in California in that 4-digit industry.

 

D. that she is talking about the New Auto Industry Classification Survey.

 

E. that none of these alternatives is correct.

The NAICS code breakdowns become more detailed as the number of digits in the code increase. Detailed data (say, broken down at the four-digit level) isn’t available for all industries in every geographic area.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 3 Hard
Topic: Manufacturers Are Important Customers
 

 

241. The U.S. government would NOT publish NAICS data that gives:

A. the total sales volume of the four steel manufacturers in a geographic area.

 

B. the number of employees for similar two-digit industry groups.

 

C. the total sales volume of the only textile equipment manufacturer in a state.

 

D. the sales volumes of similar two-digit industry groups.

 

E. the number of establishments for various industry groups.

The government does not provide detail when only one or two plants are located in an area. The textile equipment manufacturer, being the only plant in a state, would not find a place in the NAICS code.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Manufacturers Are Important Customers
 

 

242. Which of the following NAICS codes would be used by a marketing manager who wanted data on the MOST GENERAL breakdown of a particular industry?

A. 31

 

B. 31522

 

C. 315

 

D. 3152

 

E. There is no way to tell from the information provided.

A marketing manager looking for data on the most general breakdown of a particular industry should follow the NAICS codes with the least number of digits. The NAICS code breakdowns become more detailed as the number of digits in the code increase.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

243. Which of the following NAICS codes would be used by a marketing manager who wanted data that was the MOST SPECIFIC to a particular type of firm within an industry?

A. 31

 

B. 31522

 

C. 315

 

D. 3152

 

E. There is no way to tell from the information provided.

The NAICS code breakdowns become more detailed and specific as the number of digits in the code increase.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 2 Medium
Topic: Manufacturers Are Important Customers
 

 

244. After identifying its key customers in terms of profitability, a firm can look to see what similar characteristics those current customers have. Then, it can try to find prospective new customers who characteristics similar to its current customers. What type of research analysis is most likely to prove fruitful in identifying these new prospects?

A. ISO 9000

 

B. Resident buyer codes

 

C. NAICS codes

 

D. Intermediary codes

 

E. JIT codes

Many firms find their current customers’ NAICS codes and then look at NAICS coded lists for similar companies that may need the same goods and services to identify prospective customers.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-05 Know about the number and distribution of manufacturers and why they are an important customer group.
Level of Difficulty: 1 Easy
Topic: Manufacturers Are Important Customers
 

 

245. Which of the following statements about purchasing by small service firms is NOT TRUE?

A. Purchases by small service firms are often handled by whoever is in charge or their administrative assistant.

 

B. Purchases by small service firms can add up and these smaller firms are now an important target market.

 

C. Purchases by small service firms are usually handled by a person with full-time responsibility for purchasing.

 

D. Small service firms may need much more help in buying than large corporations.

 

E. Small service companies often rely on e-commerce for purchases.

Purchases by small service firms are often handled by whoever is in charge or their administrative assistant. This may be a doctor, lawyer, owner of a local insurance agency, hotel manager, or their secretary or office manager.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: Producers of Services-Smaller and More Spread Out
 

 

246. Which of these statements regarding manufacturing and service firms is true?

A. Manufacturers are more spread out around the country than service firms.

 

B. The U.S. has many more manufacturing firms than service firms.

 

C. B2B e-commerce purchasing is common for both manufacturing and service firms.

 

D. Unlike manufacturing firms, service firms rely on engineering and R&D people to help make purchase decisions.

 

E. Unlike service firms, manufacturers tend to locate where they can be closest to their customers.

Manufacturing and service firms alike use e-commerce for purchasing.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: Producers of Services-Smaller and More Spread Out
 

 

247. Buyers at _______ sees their role as being “purchasing agents for their target customers”?

A. manufacturers

 

B. government agencies

 

C. service firms

 

D. non-profits

 

E. retailers and wholesalers

Most retail and wholesale buyers see themselves as purchasing agents for their target customers. They do not typically see themselves as sales agents for particular manufacturers.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: Retailers and Wholesalers Buy for their Customers
 

 

248. With regard to retail buying:

A. Most retail buyers see themselves as purchasing agents for their suppliers.

 

B. Buying committees, instead of individual retail buyers, may make the decisions.

 

C. Retail buyers make most purchases as modified rebuys.

 

D. Persuasive salespeople, not buying committees, are the key influencers in the buying process.

 

E. None of these alternatives is correct.

Decisions to add or drop lines or change buying policies may be handled by a buying committee.

 

AACSB: Analytic
Blooms: Create
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: Retailers and Wholesalers Buy for their Customers
 

 

249. Regarding buying by intermediaries,

A. computer-controlled inventory systems make buyers more dependent on sales reps.

 

B. buying committees are a way for supermarkets to handle the flood of new products.

 

C. buyers are seldom influenced by their salespeople.

 

D. wholesalers and retailers typically only carry products which they have judged “socially desirable.”

 

E. None of these alternatives is correct.

Space in retail stores is limited, and buyers for retail chains simply are not interested in carrying every product that some salesperson wants them to sell. Decisions to add or drop lines or change buying policies may be handled by a buying committee.

 

AACSB: Analytic
Blooms: Create
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 3 Hard
Topic: Retailers and Wholesalers Buy for their Customers
 

 

250. When a large wholesaler or retailer uses a buying committee,

A. the buyer still makes the final purchase decision.

 

B. the sales rep may not be able to make a sales presentation to the committee.

 

C. the impact of persuasive salespeople is increased.

 

D. the intermediary is more likely to take a chance on a really new product that hasn’t yet proved itself.

 

E. None of these alternatives is correct.

When a large wholesaler or retailer uses a buying committee, the seller may not get to present her story to the buying committee in person.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: Retailers and Wholesalers Buy for their Customers
 

 

251. Committee buying in large retail chains

A. makes the buyers work as a group and thus lower costs.

 

B. allows a sales rep to avoid a difficult buyer.

 

C. makes it difficult for the seller to see a buyer personally.

 

D. reduces the impact of a persuasive sales rep.

 

E. All of these alternatives are correct.

When large retail chains use a buying committee, the seller may not get to present her story to the buying committee in person. This approach certainly reduces the impact of a persuasive salesperson.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: Retailers and Wholesalers Buy for their Customers
 

 

252. Because more intermediaries are using computer systems to control inventory levels,

A. they can assess the profitability of each product.

 

B. new-task buying is increasing.

 

C. they are carrying larger inventories.

 

D. negotiated contract buying is increasing.

 

E. All of these alternatives are occurring.

Most large firms and even small retailers and wholesalers are using computer systems to control inventory levels. These automated control systems create daily reports showing sales of every product which can be used to assess the profitability of each product.

 

AACSB: Technology
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 3 Hard
Topic: Retailers and Wholesalers Buy for their Customers
 

 

253. Large wholesale and retail buyers typically:

A. pay close attention to each of the products they buy.

 

B. don’t trust automatic inventory control methods.

 

C. see themselves as selling agents for manufacturers.

 

D. buy most of their products as straight rebuys.

 

E. None of these alternatives is correct.

Retailers and wholesalers usually carry a large number of products. Most intermediaries buy their products on a routine, automatic reorder basis—straight rebuys.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Retailers and Wholesalers Buy for their Customers
 

 

254. In large retail firms

A. committee buying favors sellers with persuasive salespeople.

 

B. buying committees are the way all buying decisions are now made.

 

C. buyers have computers systems that let them know the profitability of different competing products.

 

D. purchasing agents make decisions based on what products they would buy themselves.

 

E. None of these alternatives is true.

Most large firms use computer systems to control inventory levels. The automated control systems create daily reports showing sales of every product which can be used to assess the profitability of each product.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: Retailers and Wholesalers Buy for their Customers
 

 

255. With regard to government buying:

A. One of the primary concerns of government buyers is finding the lowest price.

 

B. A government buyer may be forced to accept the lowest bid whether he wants the goods or not.

 

C. A government buyer can accept a higher bid when lower bids don’t meet the required specifications.

 

D. Purchases by government buyers in the United States are usually subject to much public review.

 

E. All of these alternatives are correct.

Often the government buyer must accept the lowest bid that meets the specifications. A contract can be landed without the lowest bid when lower bids don’t meet minimum or requested specifications. Government buyers in the United States are expected to spend money wisely, so their purchases are usually subject to much public review.

 

AACSB: Analytic
Blooms: Create
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: The Government Market
 

 

256. All of the following are true of government markets except

A. the government is the largest customer group in all countries.

 

B. most government customers buy by specification using a mandatory bidding procedure.

 

C. the government buyer must often accept the lowest bid that meets the specifications.

 

D. by law, a government unit might have to accept the lowest bid even for an unwanted product.

 

E. government purchases are usually subject to much public review.

Government is the largest customer group in many but not all countries.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: The Government Market
 

 

257. The government market:

A. Is one of the smallest customer groups in the United States.

 

B. Often has a buying process that includes purchase specifications and competitive bidding procedures.

 

C. Purchases a fairly narrow range of products dealing with public safety.

 

D. None of these alternatives is correct.

Most government customers buy by specification using a mandatory bidding procedure.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

258. The government market

A. often relies on an “approved supplier list” for routine items that are bought frequently.

 

B. is the largest customer group in the United States, accounting for about 30 percent of the gross domestic product.

 

C. usually buys from the lowest price supplier that can meet the written specifications.

 

D. normally uses a mandatory bidding procedure.

 

E. All of these alternatives are true.

A supplier must be on the list of approved suppliers. Government accounts for about 30 percent of the U.S. gross domestic product. The government buyer accepts the lowest bid that meets the specifications. Most government customers buy by specification using a mandatory bidding procedure.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

259. Government buyers in the U.S. usually buy by:

A. specification—using a mandatory bidding procedure.

 

B. inspection.

 

C. haggling.

 

D. influence peddling.

 

E. None of these are good choices.

Most government customers buy by specification using a mandatory bidding procedure.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
 

 

260. Regarding the government market,

A. sales reps generally do not (and should not) write the specifications for government business.

 

B. government is the largest customer group in the United States—spending about 30 percent of GDP.

 

C. governments buy a lot, but only of certain products and can be safely ignored by most producers.

 

D. competitive bids are uncommon because of mandatory bidding procedures.

 

E. All of these alternatives are true.

Government is the largest customer group in many countries including the United States. About 30 percent of the U.S. gross domestic product is spent by various government units.

 

AACSB: Analytic
Blooms: Create
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 3 Hard
Topic: The Government Market
 

 

261. Regarding U.S. government market buying,

A. a buyer may order from a supplier on the “approved list” at a previously set price—without asking for new bids.

 

B. most buyers write specs so that only one brand or supplier qualifies.

 

C. it is illegal for a salesperson to try to influence the writing of product specifications.

 

D. most buyers buy by inspection since they are expected to spend money wisely.

 

E. None of these alternatives is true.

The government unit simply places an order at a previously approved price. To share in this business, a supplier must be on the list of approved suppliers and agree on a price that will stay the same for a specific period—perhaps a year.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: The Government Market
 

 

262. In selling to government units, a supplier should do each of the following EXCEPT:

A. Learn the bidding methods of government units it is targeting.

 

B. Match marketing mixes to bid procedures.

 

C. Read about potential government target markets from various government publications.

 

D. Get permission from the government in a particular country to sell to that country.

 

E. All of these should be done by suppliers.

Potential suppliers should focus on targeted government units; they should monitor websites where government contracts are advertised; make sure their marketing mixes are well matched with the different bid procedures; and get permission from the government in its own country when they want to sell to a foreign government.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 2 Medium
Topic: The Government Market
 

 

263. This act, passed by the U.S. Congress in 1977, prohibits U.S. firms from paying bribes to foreign officials.

A. Corporate Responsibility for the New Millennium Act

 

B. Racketeer Influenced and Corrupt Organization Act

 

C. Ethics in Business Act

 

D. Anti-Bribery Act

 

E. Foreign Corrupt Practices Act

The Foreign Corrupt Practices Act, passed by the U.S. Congress in 1977, prohibits U.S. firms from paying bribes to foreign officials.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 06-06 Know how buying by service firms; retailers; wholesalers; and governments is similar to-and different from-buying by manufacturers.
Level of Difficulty: 1 Easy
Topic: The Government Market
  

Chapter 07 Improving Decisions with Marketing Information Answer Key
True / False Questions

1. The function of marketing research is to develop and analyze new information to help marketing managers make better decisions.

TRUE

Marketing managers may need marketing research, an MIS, or a combination of both to get the information they need to make decisions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

2. Marketing research focuses on changing information needs while an MIS focuses on recurring information needs.

TRUE

Marketing research develops and analyzes new information about a market while MIS is an organized way of continually gathering, accessing, and analyzing information.

 

AACSB: Analytic
Blooms: Create
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

3. A marketing information system (MIS) is an organized way of continually gathering, accessing, and analyzing information that marketing managers need to make ongoing decisions.

TRUE

A marketing information system (MIS) is an organized way of continually gathering, accessing, and analyzing information that marketing managers need to make ongoing decisions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

4. It is the job of the MIS specialist to ask for the right information in the right form.

FALSE

Research or MIS development activities cannot be turned over to the MIS specialists. Marketing managers set the firm’s marketing objectives and know what data they’ve routinely used in the past.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Effective Marketing Requires Good Information
 

 

5. It is the job of the marketing manager to ask for the right information in the right form.

TRUE

Research or MIS development activities cannot be turned over to the MIS specialists. Marketing managers set the firm’s marketing objectives and know what data they’ve routinely used in the past.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

6. Big data involves data sets too large and complex to work with typical database management tools.

TRUE

This explosion is often referred to as big data—or data sets too large and complex to work with typical database management tools.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

7. A data warehouse is filled with file cabinets and binders where past market research is stored.

FALSE

An MIS organizes all of this incoming data and information into a data warehouse—a place where databases are stored so that they are available when needed.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

8. In its raw form, marketing managers find data useful.

FALSE

All that data in its raw form is not useful to a marketing manager. So an MIS includes software programs that convert the data to information that is useful to managers.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

9. Sales data becomes wisdom when it provides answers to questions of “who,” “what,” “where,” “how much,” and “when.”

FALSE

Sales data becomes information when it provides answers to questions of “who,” “what,” “where,” “how much,” and “when.”

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

10. Marketing managers turn information into knowledge when they use their experience to answer “how” and “why” questions.

FALSE

Information becomes knowledge when it helps a marketing manager answer “how” and “why” questions.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

11. An intranet works like the Internet but access is limited to a company’s employees.

TRUE

An intranet works like the Internet. However, to maintain security, access to websites or data on an intranet is usually limited to employees.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

12. Only large firms have their own intranets.

FALSE

Many firms, even small ones, have their own intranet.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

13. A decision support system (DSS) is a computer program that makes it easy for a marketing manager to get and use information as he or she is making decisions.

TRUE

A decision support system (DSS) is a computer program that makes it easy for a marketing manager to get and use information as he or she is making decisions.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

14. Decision support systems that include marketing models help managers by showing the relationships among marketing variables.

TRUE

A marketing model is a statement of relationships among marketing variables.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

15. A marketing dashboard displays up-to-the-minute marketing data in an easy-to-read format.

TRUE

A marketing dashboard displays up-to-the-minute marketing data in an easy-to-read format.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

16. A marketing model displays up-to-the-minute marketing data in an easy to read format.

FALSE

A marketing model is a statement of relationships among marketing variables. This question provides the definition of a marketing dashboard.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

17. It isn’t necessary for marketing managers to be involved with marketing research specialists, since research requires statistical skills which managers usually don’t have.

FALSE

Good marketing research requires cooperation between researchers and marketing managers. Marketing managers must be able to explain their problems and information they need to the specialists.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

18. Marketing managers should be able to explain the kinds of problems they are facing and the kinds of marketing research information that will help them make decisions.

TRUE

Marketing managers must be able to explain to the specialists what their problems are and what kinds of information they need.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

19. Since marketing managers have to be able to evaluate research results, they should be involved in the design of research projects—even though they may not be research specialists.

TRUE

Marketing managers must be able to explain their problems and kinds of information they need. They should be able to explain exactly what they want from the research, and know about some of the basic decisions made during the research so they know the limitations of the findings.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

20. A marketing manager can use a DSS to conduct sales and perform analyses that show a more detailed breakdown of what’s happening.

TRUE

Using a marketing model, marketing managers can break down sales by product, store, and time period, and compare them to past results to help spot buying trends early and plan for them.

 

AACSB: Technology
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

21. Use of the scientific method in marketing research helps managers make the best decisions possible.

TRUE

The scientific method is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

22. A marketing researcher using the scientific method develops and tests hypotheses about the relationships between things or about what will happen in the future.

TRUE

With the scientific method, managers use their intuition and observations to develop hypotheses—educated guesses about the relationships between things or about what will happen in the future.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

23. Use of the scientific method in marketing research forces researchers to use an inflexible process.

FALSE

The scientific method in marketing research forces an orderly process.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

24. Use of the scientific method in marketing research forces researchers to use an orderly process.

TRUE

Scientific method focuses on being objective and orderly in testing ideas before accepting them.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

25. Hypotheses are educated guesses about the relationships between things or about what will happen in the future.

TRUE

Hypotheses are educated guesses about the relationships between things or about what will happen in the future.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

26. The scientific method is a research process which consists of five stages: observation, developing hypotheses, predicting the future, collecting data, and using statistical methods of analysis.

FALSE

The scientific method is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

27. Defining the problem is the first step in the marketing research process—and is usually the easiest job for the researcher.

FALSE

Defining the problem, which is the first step in the marketing research process, is often the most difficult.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

28. Defining the problem is always the easiest step in the marketing research process.

FALSE

Defining the problem is often the most difficult step in the marketing research process.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: Defining the Problem-Step 1
 

 

29. Defining the problem is often the most difficult step in the marketing research process.

TRUE

Defining the problem is often the most difficult step in the marketing research process.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

30. To avoid wasting time working on the wrong problem, marketing researchers can use a logical strategy planning framework to guide their efforts.

TRUE

Strategy planning framework is useful for guiding the problem definition step. It can help the researcher identify the real problem area and what information is needed.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

31. Unless the problem is precisely defined, research effort may be wasted on the wrong problem, and may lead to costly mistakes.

TRUE

A manager must narrow down and clearly define the research objectives. The best research job on the wrong problem is wasted effort. Companies rarely have enough time and money to study everything.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

32. A situation analysis is a formal study of what information is already available in the problem area.

FALSE

A situation analysis is an informal study of what information is already available in the problem area.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

33. During the situation analysis, marketing researchers may talk to informed people within the company, study internal records, search libraries for available information, or browse the Internet with a search engine.

TRUE

The situation analysis aims to find relevant secondary data. The source of secondary data may include company files, intranet, reports, marketing information system, people, sales and cost data, Internet, libraries, governments, trade associations, universities, and private research organizations.

 

AACSB: Analytic
AACSB: Technology
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

34. Secondary data is information which is already published or collected.

TRUE

Secondary data refers to information that has been collected or published already.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

35. Secondary data involves information that has been collected or published already.

TRUE

Secondary data refers to information that has been collected or published already.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

36. During the situation analysis, a marketing researcher will evaluate primary data rather than secondary data.

FALSE

During the situation analysis, a researcher evaluates secondary data.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

37. The Internet is an excellent source for primary data, but not secondary data.

FALSE

Secondary data refers to information that has been collected or published already. One of the first places a researcher should look for secondary data is on the Internet.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

38. Much of the secondary data on the Internet is stored in database formats that standard website search engines cannot find.

TRUE

Many marketing managers don’t realize that much of the information stored on the Internet is in database formats that standard website search engines can’t find. The website with the relevant database should be located and then software at the site should be used to search inside the database.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

39. Specialized search engines like Blogdex and Google Groups can locate websites that allow marketing managers to listen in or ask questions as customers chat about companies and brands.

TRUE

Marketing managers log in to blogs or online discussion groups to “eavesdrop” or ask questions as customers chat about companies or brands of interest. Specialized search engines like Blogdex and Google Groups locate these sites.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

40. The government, advertising agencies, newspapers, trade associations, and research subscription services are all major sources of primary data.

FALSE

Sources of secondary data include government, advertising agencies, newspapers, trade associations, research subscription services, company files, intranet, reports, marketing information system, people, sales, cost data, Internet, libraries, governments, trade associations, universities, and private research organizations.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

41. The Statistical Abstract of the United States is one of the most useful summaries of secondary data published by the federal government.

TRUE

Federal and state governments publish secondary data on many subjects. For the U.S. market, one of the most useful summary references is the Statistical Abstract of the United States.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

42. A good situation analysis is usually inexpensive compared with more formal research efforts, such as a large scale survey.

TRUE

A good situation analysis is very informative, takes little time, and is inexpensive compared with more formal research efforts like a large-scale survey.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

43. A research proposal involves interviewing 6 to 10 people in an informal group setting.

FALSE

A research proposal is a plan that specifies what information will be obtained and how. The focus group interview involves interviewing 6 to 10 people in an informal group setting.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

44. In general, a marketing researcher should get some problem-specific data before planning a formal research project.

FALSE

Collecting problem-specific data is the third step in a marketing research project. It comes after a research proposal is in place.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

45. A formal marketing research project usually involves gathering primary data.

TRUE

Collecting primary data or problem-specific data is the third step in a marketing research project.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

46. Qualitative research seeks in-depth, open-ended responses.

TRUE

Qualitative research seeks in-depth, open-ended responses, not yes or no answers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

47. Qualitative research seeks clear yes or no answers.

FALSE

Qualitative research seeks in-depth, open-ended responses, not yes or no answers.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

48. Focus group interviews are a form of quantitative research.

FALSE

One widely used form of qualitative questioning in marketing research is the focus group interview.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

49. A focus group interview involves interviewing 6 to 10 people in an informal group setting.

TRUE

A focus group interview involves interviewing 6 to 10 people in an informal group setting.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

50. Online focus groups can offset some of the limitations of traditional focus groups because one aggressive member is less likely to dominate the group.

TRUE

Online focus groups can offset some of the limitations of traditional focus groups. Participants who meet online express their honest thoughts—and an aggressive individual is less likely to dominate the group.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

51. Focus groups are a way to gather primary data quickly, but at a relatively high cost.

FALSE

The focus group, which is one of the methods for collecting primary data, can be conducted quickly and at relatively low cost—an average of about $4,000 each.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

52. Qualitative research seeks structured responses that can be summarized in numbers, like percentages, averages, or other statistics.

FALSE

Quantitative research seeks structured responses that can be summarized in numbers, like percentages, averages, or other statistics. Qualitative research seeks in-depth, open-ended responses, not yes or no answers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

53. Open-ended questions are less likely to be asked in quantitative research than in qualitative research.

TRUE

Qualitative research seeks in-depth, open-ended responses, not yes or no answers; quantitative research seeks structured responses.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

54. A common quantitative research approach is to use survey questionnaires with multiple-choice questions.

TRUE

Most survey research is quantitative research. Survey questionnaires usually provide fixed responses to questions. Multiple-choice approach makes it easier and faster for respondents.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

55. One reason for the popularity of mail surveys is that the response rates are usually very high.

FALSE

The advantages of mail surveys are convenience for the respondents, willingness to provide personal information etc., while the disadvantage is poor response rate.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

56. Response rate is the percentage of people contacted who complete a given questionnaire.

TRUE

The response rate refers to the percentage of people contacted who complete a given questionnaire.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

57. One weakness of telephone interviews is that they do not allow an interviewer to probe and really learn what the respondent is thinking.

FALSE

Telephone interviews allow the interviewer to probe and really learn what the respondent is thinking. Such interviews are also popular and effective for getting quick answers to simple questions.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

58. Telephone surveys are practical if the information needed is not too personal.

TRUE

Generally, the respondents to telephone surveys are concerned about how personal information might be used. If the survey does not involve personal information, telephone surveys are preferred.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

59. A market research online community combines qualitative and quantitative approaches in private online communities.

TRUE

One technique combines qualitative and quantitative approaches in private online communities. A market research online community (MROC) is an online group of participants who are joined together by a common interest, and who participate in ongoing research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

60. Market research online communities are one-time events.

FALSE

One technique combines qualitative and quantitative approaches in private online communities. A market research online community (MROC) is an online group of participants who are joined together by a common interest, and who participate in ongoing research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

61. With roots in biology, ethnographic research studies different cultures by examining their physiology.

FALSE

Ethnographic research has its roots in anthropology, which studies different cultures by observing participants in their natural habitat.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

62. Observing—as a method of collecting data—should focus on a well-defined problem.

TRUE

Observing, which is a method of collecting data, focuses on a well-defined problem. With the observation method, researchers try to see or record what the subject does naturally.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

63. In the observation method, researchers try to see or record what the subject does naturally.

TRUE

Observing, which is a method of collecting data, focuses on a well-defined problem. With the observation method, researchers try to see or record what the subject does naturally.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

64. With the observation method, the researcher skillfully engages the subject in conversation.

FALSE

With the observation method, researchers try to see or record what the subject does naturally. They don’t want the observing to influence the subject’s behavior.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

65. Nielsen’s TV audience research and Arbitron’s radio audience research illustrate that observing is a common research method in advertising.

TRUE

Observation methods are common in advertising research. Nielsen Media Research uses “people meter” for the observation method to television audience research. Arbitron uses “Portable People Meter (PPM)” to automatically measure radio listening habits.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

66. A consumer panel is a group of consumers who provide information on a continuing basis.

TRUE

A consumer panel is a group of consumers who provide information on a continuing basis.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

67. Applying the experimental method in marketing research usually means the responses of groups are compared.

TRUE

With the experimental method, marketing researchers compare the responses of two (or more) groups that are similar except on the characteristic being tested.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

68. In the experimental method, researchers compare the responses of two or more groups that are similar even on the characteristic being tested.

FALSE

With the experimental method, marketing researchers compare the responses of two (or more) groups that are similar except on the characteristic being tested.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

69. Syndicated research is an economical approach for collecting specific research needed by one firm for a specific problem.

FALSE

Syndicated research is an economical approach when marketing managers from many different firms need the same type of data.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

70. Only about 25 percent of marketing research spending is for syndicated research.

FALSE

About 40 percent of marketing research spending is for syndicated research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

71. J.D. Power’s surveys of customer satisfaction are a popular example of syndicated research.

TRUE

Many different auto producers use J. D. Power’s surveys of customer satisfaction as the basis for advertising claims. This serves as an example of syndicated research.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

72. Even though marketing managers might like more information, they must balance the high cost of good research against its probable value to management.

TRUE

As marketing research takes time and money, a good marketing manager should know the cost of research, and the value of additional information.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

73. A marketing manager should seek help from research only for problems where the risk of a decision can be greatly reduced at a reasonable cost.

TRUE

Marketing research takes time and money. A good marketing manager knows that the value of additional information lies in the ability to design more effective marketing strategies.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

74. Statistical packages are easy-to-use computer programs that analyze data.

TRUE

Statistical packages are easy-to-use computer programs that analyze data easily. So managers can use a statistical package to interpret data themselves.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

75. A statistical package is likely to be used with quantitative research, but not with qualitative research.

TRUE

In quantitative research, data interpretation usually involves statistics. Statistical packages are easy-to-use computer programs that analyze data easily.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

76. In a quantitative marketing research study, the total group of people a marketing manager is interested in learning something about is known as the sample.

FALSE

‘Population’ is the total group the marketing manager is interested in, while ‘sample’ is a part of the relevant population.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

77. In marketing research, a population is a part of the relevant sample.

FALSE

‘Population’ is the total group the marketing manager is interested in, while ‘sample’ is a part of the relevant population.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

78. The extent to which marketing research data measures what it is intended to measure is known as the confidence level.

FALSE

Validity concerns the extent to which data measure what they are intended to measure. Validity problems are important in marketing research.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

79. Validity concerns the extent to which data measures what it is intended to measure.

TRUE

Validity concerns the extent to which data measure what they are intended to measure. Validity problems are important in marketing research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

80. All marketing research projects are worthwhile because they gather new information—even if the research doesn’t have action implications.

FALSE

Though the information that comes from the research process is fascinating, if the marketing research doesn’t have action implications, it has little value and suggests poor planning.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Solving the Problem-Step 5
 

 

81. When a firm is doing similar research projects in different international markets, it makes sense for the marketing manager to coordinate the efforts so that comparisons across markets are possible.

TRUE

When a firm is doing similar research projects in different markets around the world, it makes sense for the marketing manager to coordinate the efforts. The results can be compared and used for a better chance of understanding.

 

AACSB: Diversity
Blooms: Remember
Learning Objective: 07-06 Recognize how market research information aids marketing planning in international markets.
Level of Difficulty: 1 Easy
Topic: International Marketing Research
 

 

Multiple Choice Questions

82. Procedures that develop and analyze new information to help marketing managers make decisions are called:

A. strategy planning.

 

B. operational planning.

 

C. analytical research.

 

D. marketing research.

 

E. statistical techniques.

Marketing research refers to procedures that develop and analyze new information about a market. It is the key source that marketing managers turn to for information to make better decisions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

83. Procedures that develop and analyze new information to help marketing managers make decisions are called:

A. marketing research.

 

B. statistical techniques.

 

C. operational planning.

 

D. strategy planning.

 

E. sample building units (SBUs).

Marketing research refers to procedures that develop and analyze new information about a market. It is the key source that marketing managers turn to for information to make better decisions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

84. _____ refers to the procedures that develop and analyze new information about a market.

A. Marketing research

 

B. Marketing information system

 

C. Frequency monitoring program

 

D. Marketing plan

 

E. Management information system

Marketing research refers to procedures that develop and analyze new information about a market.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

85. ________________ ________________ utilizes qualitative and quantitative analysis procedures to help marketing managers make more informed decisions.

A. Marketing planning

 

B. Marketing processing

 

C. Marketing structure

 

D. Marketing research

 

E. Marketing strategy

Marketing research includes both qualitative and quantitative analysis procedures like using questionnaires, interviews with customers, observation method, experiments, and many other approaches. This helps marketing managers make better decisions.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

86. Marketing research is concerned with developing and analyzing new information to help marketing managers do a better job of:

A. executing marketing strategies.

 

B. planning marketing strategies.

 

C. making operational decisions.

 

D. controlling marketing strategies.

 

E. All of these alternatives are correct.

To make good marketing decisions, marketing managers need marketing research during any step in the marketing strategy planning process, to improve implementation, execution, and control.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Effective Marketing Requires Good Information
 

 

87. Marketing research:

A. is an organized way of gathering and analyzing information marketing managers need.

 

B. involves a wide range of techniques including internet search, customer surveys, and more.

 

C. is a department in most small companies.

 

D. is only needed by producers who have long channels of distribution.

 

E. is an alternative to a marketing information system.

One source is marketing research—procedures that develop and analyze new information about a market. Marketing research involves a wide range of techniques including Internet searches, customer surveys, experiments, direct observation of customers, and many more.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

88. Identify the INCORRECT statement about marketing research.

A. Most small companies have a separate marketing research department.

 

B. People in marketing research departments often rely on outside specialists.

 

C. Some nonprofit organizations have begun to use marketing research.

 

D. Marketing managers should be involved in design of marketing information system.

 

E. Marketing research may involve use of questionnaires, interviews with customers, experiments, etc.

Small companies usually don’t have separate marketing research departments. They often depend on their salespeople or managers to conduct research.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Effective Marketing Requires Good Information
 

 

89. Marketing research:

A. should be planned by research specialists who understand research techniques better than marketing managers.

 

B. is only needed by producers who use long channels of distribution.

 

C. is not needed by nonprofits because they determine success differently from for-profits.

 

D. is not needed by business marketers because their needs are different from consumer marketers.

 

E. can get changing information that is not available in the MIS.

Marketing research can provide new information that is not routinely available through the firm’s MIS.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Effective Marketing Requires Good Information
 

 

90. A ______________ is an organized way of continually gathering and analyzing data to get information to help marketing managers make ongoing decisions.

A. marketing information system

 

B. marketing model

 

C. marketing research project

 

D. marketing research department

 

E. marketing logistics system

Marketing information system (MIS) is an organized way of continually gathering, accessing, and analyzing information that marketing managers need to make ongoing decisions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

91. _____ refers to an organized way of continually gathering, accessing, and analyzing information that marketing managers need to make ongoing decisions.

A. Active marketing

 

B. Manufacturing information system

 

C. Marketing research

 

D. Marketing information system

 

E. Target marketing

Marketing information system (MIS) is an organized way of continually gathering, accessing, and analyzing information that marketing managers need to make ongoing decisions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

92. Regarding a marketing information system (MIS):

A. The input of marketing managers is not needed in developing an MIS; marketers should leave everything to information technology specialists.

 

B. Can be used to improve implementation and control.

 

C. A good MIS converts information into raw data.

 

D. An MIS provides an alternative to big data.

 

E. All of these statements about a marketing information system are correct.

Marketing managers may need marketing research, an MIS, or a combination of both to get the information they need to make decisions during any step in the marketing strategy planning process—or to improve implementation and control.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Effective Marketing Requires Good Information
 

 

93. Marketing information systems rely heavily on:

A. information gathered by salespeople.

 

B. customer surveys.

 

C. teamwork between IT experts and marketing managers.

 

D. direct observation of customers.

 

E. marketing research departments.

It is very important that marketing managers be closely involved in the design of an MIS. Information technology experts can make sure that the technical aspects are handled correctly, but marketing managers need to make sure they can access information to guide marketing strategy planning or implementation and control.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Effective Marketing Requires Good Information
 

 

94. A __________ is an organized way of continually gathering, accessing, and analyzing information that marketing managers need to make ongoing decisions.

A. big data repository

 

B. data warehouse

 

C. marketing information system

 

D. research specialist network

 

E. marketing model

A marketing information system is an organized way of continually gathering, accessing, and analyzing information that marketing managers need to make ongoing decisions.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Effective Marketing Requires Good Information
 

 

95. A complete marketing information system includes each of the following except:

A. data from internal sources.

 

B. marketing models.

 

C. decision support systems.

 

D. a data warehouse.

 

E. All of these alternatives are correct.

See Exhibit 7-2.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

96. A complete marketing information system should:

A. provide a good overall view on many types of problems.

 

B. organize incoming information into a data warehouse.

 

C. provide answers to specific questions.

 

D. continually gather data from internal and external sources, and from market research studies.

 

E. All of these alternatives are true.

See Exhibit 7-2. An MIS organizes incoming information into a data warehouse. It provides managers access to more information; managers obtain specialized reports from information technology specialists. A continual flow of information is available and quickly accessible from an MIS.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

97. Big data does not comes from which of the following sources?

A. spreadsheets

 

B. social media sites

 

C. clickstreams

 

D. digital sensors on industrial equipment

 

E. big data comes from all of these sources

The explosion of data comes as organizations collect and store more information from internal sources (for example, e-mails, spreadsheets, documents, financial reports, and clickstreams—which track customers as they move through a company’s website), external sources (for example, from government sources like the U.S. Census, social media websites like Facebook and LinkedIn, and digital sensors which can be found on industrial equipment, automobiles, and shopping crates) and market research studies (for example, previously conducted surveys, experiments, or other reports).

 

AACSB: Analytic
Blooms: Analyze
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Effective Marketing Requires Good Information
 

 

98. The phrase “big data” refers to:

A. the top five firms in the marketing research industry.

 

B. the massive amount of data being collected and processed by today’s organizations.

 

C. the use of market research in big marketing decisions.

 

D. marketing research data taken from Internet sources.

 

E. market information taken from the U.S. Census.

The amount of data that organizations collect doubles every two years. This explosion is often referred to as “big data”-or data sets too large and complex to work with typical database management tools.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

99. Which of the following trends creates difficult challenges for marketing managers?

A. Market data can now be gathered from social media websites.

 

B. Market data may be gathered from internal sources and external sources.

 

C. IT managers have become an important part of the marketing research process.

 

D. Data warehouses have become a central part of most marketing information systems.

 

E. Today’s businesses process 1000 times as much data as they did in the year 2000.

It has been estimated that organizations today process 1000 times as much data as they did in the year 2000. The explosion of data collection has created data sets too large and complex to work with typical database management tools.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

100. For raw data to become useful to marketers, it must be:

A. stored in a data warehouse.

 

B. transformed into information and knowledge.

 

C. gathered from internal company sources.

 

D. gathered from external sources.

 

E. communicated to executives through a formal report.

Data in its raw form is not useful to a marketing manager. So an MIS includes software programs that convert the data to information that is useful to managers. Data becomes information when it provides answers to questions of “who,” “what,” “where,” and “when.” That information then becomes knowledge when it helps a marketing managers answer “how” and “why” questions.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

101. When getting information for marketing decisions, the marketing manager:

A. may use both internal and external sources of information.

 

B. may need to make some decisions based on incomplete information.

 

C. may need to rely on his or her own instincts to make some decisions.

 

D. should have access to ongoing information about business performance.

 

E. All of these alternatives are correct.

Marketing managers for some companies make decisions based on their own judgment with very little hard data, but changes are under way. A continual flow of information is available and quickly accessible from an MIS.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

102. Which of the following is FALSE with respect to data, information, knowledge and wisdom.

A. Data in its raw form is not useful to managers.

 

B. Software can be used to convert data into information.

 

C. Information answers questions about “who” and “how much.”

 

D. Knowledge answers questions of “when” and “where”.

 

E. Gaining experience about why things happen builds wisdom.

All that data in its raw form is not useful to a marketing manager. So an MIS includes software programs that convert the data to information that is useful to managers. Sales data becomes information when it provides answers to questions of “who,” “what,” “where,” “how much,” and “when.” Information becomes knowledge when it helps a marketing manager answer “how” and “why” questions. As a marketing manager gains experience and understanding of why things happened in the past, they can put that together to build wisdom and better estimates about what will happen in the future. This helps them to better evaluate possible marketing strategy decisions.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 3 Hard
Topic: Changes are Under Way in Marketing Information Systems
 

 

103. Marketing manager Carl Hammer looked through his marketing information system where he learned who was buying his product and where. He was looking at:

A. raw data.

 

B. information.

 

C. a marketing model.

 

D. big insights.

 

E. a knowledge network.

All that data in its raw form is not useful to a marketing manager. So an MIS includes software programs that convert the data to information that is useful to managers. Sales data becomes information when it provides answers to questions of “who,” “what,” “where,” “how much,” and “when.” Information becomes knowledge when it helps a marketing manager answer “how” and “why” questions. As a marketing manager gains experience and understanding of why things happened in the past, they can put that together to build wisdom and better estimates about what will happen in the future. This helps them to better evaluate possible marketing strategy decisions.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 3 Hard
Topic: Changes are Under Way in Marketing Information Systems
 

 

104. Marketing manager Ricki Stephens reviewed her marketing information system to learn who was buying her company’s products and at what stores they were buying. She found this internal and external data in her company’s:

A. data warehouse.

 

B. big data set.

 

C. market research network.

 

D. annual report.

 

E. focus group.

All that data in its raw form is not useful to a marketing manager. So an MIS includes software programs that convert the data to information that is useful to managers. Sales data becomes information when it provides answers to questions of “who,” “what,” “where,” “how much,” and “when.” Information becomes knowledge when it helps a marketing manager answer “how” and “why” questions. As a marketing manager gains experience and understanding of why things happened in the past, they can put that together to build wisdom and better estimates about what will happen in the future. This helps them to better evaluate possible marketing strategy decisions.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 3 Hard
Topic: Changes are Under Way in Marketing Information Systems
 

 

105. Regarding “marketing research” and “marketing information systems”:

A. marketing information systems gather, access, and analyze data from intracompany sources, while marketing research handles all external sources.

 

B. both tend to focus on nonrecurring information needs.

 

C. marketing information systems tend to increase the quantity of information available for decision making, but with some decrease in quality.

 

D. neither involves the use of big data.

 

E. None of these alternatives is true.

Marketing research develops and analyzes new information about a market. An MIS is an organized way of continually gathering, accessing, and analyzing information managers need to make ongoing decisions. Both are needed in today’s dynamic marketplace.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

106. Setting up a marketing information system can be valuable to marketing managers because

A. most companies have much useful information, but it often isn’t available or accessible when the manager needs it.

 

B. most market-oriented companies only need a certain type of information once or twice.

 

C. marketing research data is rarely as accurate as data from a marketing information system.

 

D. market-oriented managers can always use more data.

 

E. a company that can’t afford marketing research should at least have a marketing information system.

Marketing information system can provide a continual flow of information that is available and quickly accessible when it’s needed.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

107. Which of the following observations about the use of a marketing information system (MIS) is FALSE?

A. Not every firm has a complete MIS.

 

B. An MIS tends to focus on recurring information needs.

 

C. For most firms it pays to wait to until you have important questions you can’t answer.

 

D. It is the job of the MIS specialist to ask for the right information in the right form.

 

E. An MIS shouldn’t be the only source of information for managers while making decisions.

Many firms realize that it doesn’t pay to wait until you have important questions you can’t answer. They anticipate the information they will need. They work to develop a continual flow of information that is available and quickly accessible from an MIS when it’s needed.

 

AACSB: Analytic
Blooms: Create
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 3 Hard
Topic: Changes are Under Way in Marketing Information Systems
 

 

108. A marketing information system (MIS) includes all of the following except:

A. Data warehouses.

 

B. Decision support systems.

 

C. Internet support systems.

 

D. Marketing models.

 

E. Information technology specialists.

See Exhibit 7-2. Marketing information systems include the following: Tools to access multimedia data, Data warehouses, Decision support systems, and Marketing models.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

109. Managers at Wayzata Communications, an Internet service provider, want access to a continual flow of information about their market—available whenever they need it. Wayzata managers need a(n)

A. marketing information system.

 

B. intranet.

 

C. data warehouse.

 

D. customer relationship management system.

 

E. big data.

Marketing information system can provide a continual flow of information that is available and quickly accessible when it’s needed.

 

AACSB: Technology
Blooms: Apply
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

110. Which of the following statements about intranets is NOT TRUE?

A. Intranets are a system for linking computers within a company.

 

B. Information is available on demand.

 

C. An intranet is easy to update.

 

D. Access to websites on an intranet is unrestricted.

 

E. Even very small firms may have their own intranet.

To maintain security, access to websites or data on an intranet is restricted. Access is usually limited to employees.

 

AACSB: Technology
Blooms: Apply
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

111. An outside sales force can provide customers with up-to-date inventory levels, product prices, delivery dates, and so forth by accessing information on the firm’s own:

A. marketing model.

 

B. marketing dashboard.

 

C. intranet.

 

D. JIT system.

 

E. EDI system.

Intranet is a system for linking computers within a company. It works like the Internet. Information is easily searched and available on demand. It is simple to “publish” new information to a website as soon as it becomes available.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

112. Reshma Ananda, a marketing manager for the Grocery SuperStore retail chain, fired up a computer program that gave her ready access to information about product availability and customer buying. The program helped her immediately set prices for bananas and cherries. This type of computer program is called ______.

A. a decision support system

 

B. data warehouse management

 

C. an Internet

 

D. PRICE analysis software

 

E. raw data manager

A decision support system (DSS) is a computer program that makes it easy for a marketing manager to get and use information as he or she is making decisions.

 

AACSB: Technology
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

113. A decision support system

A. focuses only on numerical data.

 

B. makes it easy for a marketing manager to get and use information as s/he is making decisions.

 

C. organizes incoming information into a data warehouse.

 

D. is a place where databases are stored so that they are available when needed.

 

E. is a system for linking computers within a company.

A decision support system (DSS) is a computer program that makes it easy for a marketing manager to get and use information as he or she is making decisions.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

114. Juan Quito, marketing manager at Branded Food Co., reviewed his ______, the up-to-the-minute marketing data on his computer screen. It was organized in an easy-to-read format and customized to his area of responsibility.

A. intranet

 

B. marketing dashboard

 

C. internal data sources

 

D. data warehouse

 

E. internal search engine

Marketing dashboards display up-to-the-minute marketing data in an easy-to-read format. They are usually customized to a manager’s areas of responsibility.

 

AACSB: Technology
Blooms: Apply
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

115. At Verizon Communications, a marketing manager can view up-to-date marketing data that has been customized to fit his area of responsibility by using a:

A. data warehouse.

 

B. search engine.

 

C. situation analysis.

 

D. marketing dashboard.

 

E. validity study.

Marketing dashboards display up-to-the-minute marketing data in an easy-to-read format. They are usually customized to a manager’s areas of responsibility.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Changes are Under Way in Marketing Information Systems
 

 

116. A marketing model is a

A. procedure that develops and analyzes new information about a market.

 

B. detailed breakdown of a company’s sales records.

 

C. plan that specifies what information will be obtained and how.

 

D. statement of relationships among marketing variables.

 

E. software that organizes incoming information into a data warehouse.

A marketing model is a statement of relationships among marketing variables. It enables a manager to look at the sales and costs expected.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Changes are Under Way in Marketing Information Systems
 

 

117. A decision-making approach that focuses on being objective and orderly in testing ideas before accepting them is the:

A. MIS method.

 

B. scientific method.

 

C. statistical method.

 

D. DSS method.

 

E. marketing models method.

Scientific method is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them. It guides the marketing research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

118. The _____ is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them.

A. decision support system

 

B. situation analysis

 

C. idea generation process

 

D. marketing information system

 

E. scientific method

Scientific method is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them. It guides the marketing research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: The Scientific Method and Marketing Research
 

 

119. The scientific method

A. rejects the idea that marketing managers can make “educated guesses” about marketing relationships.

 

B. shows that every marketing research project should have five steps.

 

C. is an orderly and objective approach to judging how good an idea really is.

 

D. recognizes that statistical analysis provides the only basis for rejecting an hypothesis.

 

E. None of these alternatives is true.

The scientific method is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

120. The scientific method in marketing research

A. forces an orderly research process.

 

B. is an informal approach to define problems.

 

C. is not a valid decision-making approach.

 

D. is based on hunches rather than evidence.

 

E. makes guesses about what will happen in the future.

The scientific method is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: The Scientific Method and Marketing Research
 

 

121. The scientific method

A. rejects the idea that marketing managers can make “educated guesses” about marketing relationships.

 

B. is an orderly way of presenting your point of view.

 

C. assumes that statistical analysis provides the only basis for rejecting an hypothesis.

 

D. is a hit-or-miss approach.

 

E. None of these alternatives is correct.

Scientific method is a decision-making approach that focuses on being objective and orderly in testing ideas before accepting them. It is not a hit-or-miss approach. With this method, managers don’t just assume that their intuition is correct.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: The Scientific Method and Marketing Research
 

 

122. Educated guesses about the relationships between things or about what will happen in the future are:

A. theories.

 

B. laws.

 

C. facts.

 

D. hypotheses.

 

E. None of these is a good choice.

Hypotheses are educated guesses about the relationships between things or about what will happen in the future. They are tested by the marketing managers before making final decisions.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

123. Educated guesses about the relationships between things or about what will happen in the future are:

A. hypotheses.

 

B. laws.

 

C. proposals.

 

D. theories.

 

E. predictions.

Hypotheses are educated guesses about the relationships between things or about what will happen in the future. They are tested by the marketing managers before making final decisions.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

124. ____ are educated guesses about the relationships between things or about what will happen in the future.

A. Data insights

 

B. Observations

 

C. Situation analyses

 

D. Hypotheses

 

E. Marketing models

Hypotheses are educated guesses about the relationships between things or about what will happen in the future. They are tested by the marketing manager before making final decisions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: The Scientific Method and Marketing Research
 

 

125. The purpose of the five-step marketing research process is to:

A. define and solve a problem.

 

B. design, implement, and control marketing plans and activities.

 

C. narrow down a broad generic market into useful target markets.

 

D. identify the main steps in the consumer decision process.

 

E. help marketers choose between consumer markets or B2B markets.

The general purpose of the five-step marketing research process is to help marketers define and gather information to solve a problem.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

126. The five-step marketing research process ends at which step?

A. Defining the problem

 

B. Analyzing the situation

 

C. Getting problem-specific data

 

D. Interpreting the data

 

E. Any step at which the problem is solved

The marketing research process is a problem-solving process. Although it has five sequential steps, the process may lead to a solution before all of the steps are completed. The process ends whenever at whichever step a solution is reached.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

127. Which of the following statements accurately describes the collaboration between marketing managers and market researchers?

A. Marketers explain real marketing problems and request information from researchers; Researchers conduct tests that provide information to marketers.

 

B. Marketers conduct tests; Researchers turn data into useful information.

 

C. Marketers submit bids; Researchers evaluate bids.

 

D. Marketers gather data from secondary sources; Researchers input data into data warehouses for computer processing.

 

E. Marketers conduct tests; Researchers identify marketing problems.

Marketers explain real marketing problems and request information from researchers; Researchers conduct tests that provide information to marketers.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: Five-Step Approach to Marketing Research
 

 

128. Which of the following statements is NOT accurate concerning the five step approach?

A. Step 1 defines the problem.

 

B. Step 2 is early identification of solution.

 

C. Step 3 gathers problem-specific data.

 

D. Step 4 interprets data.

 

E. All of these are correct.

The marketing research process is a five-step application of the scientific method that includes: 1. Defining the problem. 2. Analyzing the situation. 3. Getting problem-specific data. 4. Interpreting the data. 5. Solving the problem.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

129. Identify the correct sequence in the marketing research process.

A. Analyzing the situation, getting problem-specific data, interpreting the data, defining the problem, solving the problem.

 

B. Analyzing the situation, defining the problem, getting problem-specific data, interpreting the data, solving the problem.

 

C. Defining the problem, analyzing the situation, getting problem-specific data, interpreting the data, solving the problem.

 

D. Getting problem-specific data, interpreting the data, analyzing the situation, defining the problem, solving the problem.

 

E. Getting problem-specific data, interpreting the data, defining the problem, solving the problem, analyzing the situation.

The marketing research process is a five-step application of the scientific method. It includes: 1) Defining the problem, 2) Analyzing the situation, 3) Getting problem-specific data, 4) Interpreting the data, and 5) Solving the problem.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

130. Which of the following is the correct sequence of steps in the marketing research process?

A. Getting problem-specific data; interpreting data; defining the problem; analyzing the situation; solving the problem.

 

B. Analyzing the situation; getting problem-specific data; interpreting data; defining the problem; solving the problem.

 

C. Defining the problem; getting problem-specific data; interpreting data; analyzing the situation; solving the problem.

 

D. Defining the problem; analyzing the situation; getting problem-specific data; interpreting the data; solving the problem.

 

E. None of these is the correct sequence of steps in the marketing research process.

The marketing research process is a five-step application of the scientific method. It includes: 1) Defining the problem, 2) Analyzing the situation, 3) Getting problem-specific data, 4) Interpreting the data, and 5) Solving the problem.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

131. Which of the following is NOT part of the five-step marketing research process discussed in the text?

A. Writing the proposal

 

B. Analyzing the situation

 

C. Solving the problem

 

D. Interpreting the data

 

E. Defining the problem

The marketing research process is a five-step application of the scientific method. This includes: 1) Defining the problem, 2) Analyzing the situation, 3) Getting problem-specific data, 4) Interpreting the data, and 5) Solving the problem.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

132. Which of the following is NOT part of the five-step marketing research process discussed in the text?

A. Interpreting the data.

 

B. Developing the marketing information system (MIS).

 

C. Analyzing the situation.

 

D. Defining the problem.

 

E. Solving the problem.

The marketing research process is a five-step application of the scientific method. This includes: 1) Defining the problem, 2) Analyzing the situation, 3) Getting problem-specific data, 4) Interpreting the data, and 5) Solving the problem.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Five-Step Approach to Marketing Research
 

 

133. Which of the following is most consistent with the scientific method approach to marketing research discussed in the text?

A. “We continually survey our customers because the results give us good ideas for hypotheses.”

 

B. “Once we interpret the data, we can define our problem.”

 

C. “Our research is as precise as possible—because we want to be 100 percent accurate.”

 

D. “Sometimes the answers from the early stages of the research process are good enough so we stop the research and make our decisions.”

 

E. None of these alternatives is correct.

The marketing research process is a five-step application of the scientific method. But, the marketing research process may lead to a solution before all of the steps are completed.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Five-Step Approach to Marketing Research
 

 

134. Regarding marketing managers and the development of market research:

A. Marketing managers may only be consumers of research.

 

B. Marketing managers do not need to be able to explain what they want from research-specialists know.

 

C. Marketing managers do not have to use the language of marketing research specialists.

 

D. Marketing managers do not need to know the basic research process.

 

E. All of these are true.

Marketing managers must be able to explain what their problems are and what kinds of information they need. They should be able to communicate with specialists in the specialists’ language. Marketing managers may only be “consumers” of research. But they should be informed consumers—able to explain exactly what they want from the research. They should also know about some of the basic decisions made during the research process so they know the limitations of the findings.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 2 Medium
Topic: Five-Step Approach to Marketing Research
 

 

135. Which of the following statements BEST reflects the point of view of the text with respect to marketing research?

A. “We don’t use computers, surveys and the like because marketing’s information needs are usually not that precise anyway.”

 

B. “When we work with outside marketing research specialists, we expect them to take the time to really understand the problem we are trying to solve.”

 

C. “As marketing manager, I feel that the marketing researchers should be left alone to do their research—since they often come up with interesting suggestions.”

 

D. “As marketing research director, I should know the marketing manager’s position in advance, so we can prove it is correct if possible.”

 

E. “Our company is very small, but we should have our own marketing research department anyway—to get the information we need to make good decisions.”

Good marketing research requires cooperation between researchers and marketing managers. Researchers must be sure their research focuses on real problems. Marketing managers must explain their problems and kinds of information they need to the researchers.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 3 Hard
Topic: Five-Step Approach to Marketing Research
 

 

136. The first step of the marketing research process-defining the problem-is the most important because:

A. it comes first.

 

B. it involves qualitative research.

 

C. failure to correctly define the problem will cause all subsequent steps to be wasted effort.

 

D. many problems go away once they are clearly defined.

 

E. it’s easy to confuse problems with symptoms at this stage.

Step 1 is the most important because a failure to define the problem correctly will invalidate the entire research project. The best research job conducted on the wrong problem is wasted effort.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

137. What is the first step in the marketing research process?

A. Analyzing the situation

 

B. Interpreting the data

 

C. Defining the problem

 

D. Getting problem-specific data

 

E. Solving the problem

Defining the problem is the first step in the marketing research process. It is often the most difficult also.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

138. Often the most difficult step in the marketing research process is:

A. analyzing the situation.

 

B. defining the problem.

 

C. getting problem-specific data.

 

D. interpreting the data.

 

E. None of these is a good choice.

Defining the problem, which is the first step in the marketing research process, is often the most difficult also.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

139. The most difficult and important step in the scientific approach to marketing research is:

A. defining the problem.

 

B. interpreting the data.

 

C. solving the problem.

 

D. analyzing the situation.

 

E. getting problem-specific data.

Defining the problem, which is the first step in the marketing research process, is often the most difficult also.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

140. Which of the following statements about the marketing research process is NOT TRUE?

A. Defining the problem is important because this decision will remain unchanged throughout the process.

 

B. The situation analysis step helps educate a researcher.

 

C. Researchers and marketing managers need to work together.

 

D. The situation analysis includes looking at secondary data.

 

E. Marketing managers often have to explain problems to researchers.

Defining the problem sounds simple, but it’s easy to confuse problems with symptoms. So, the problem may need to be redefined several times.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: Defining the Problem-Step 1
 

 

141. The first thing a marketing manager should do if one of his firm’s products drops in sales volume is:

A. conduct a survey to see what is wrong.

 

B. define the problem.

 

C. set research priorities.

 

D. do a situation analysis.

 

E. interview representative customers.

Defining the problem is the first step in the marketing research process.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Defining the Problem-Step 1
 

 

142. Regarding the marketing research process, defining the problem

A. is often confused with identifying the symptoms of the problem.

 

B. can be guided by the marketing strategy planning framework.

 

C. precisely may have to wait until after a situation analysis has been completed.

 

D. All of these alternatives are true.

Defining the problem is often confused with symptoms. The strategy planning framework is useful for guiding the problem definition step. Situation analysis is carried out before narrowing down to final research objectives.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

143. Marketing research:

A. usually requires complex statistical techniques, so marketing managers should leave planning of the research to the research specialists.

 

B. is likely to be more effective when guided by the strategy planning framework.

 

C. should gather as much information as possible.

 

D. begins by analyzing the situation.

 

E. All of these alternatives about marketing research are correct.

The strategy planning framework is useful for guiding the problem definition step of marketing research. It helps the researcher identify the real problem area and the information needed.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-01 Know about marketing information systems.
Level of Difficulty: 1 Easy
Topic: Defining the Problem-Step 1
 

 

144. Regarding the marketing research process, defining the problem

A. means identifying the symptoms.

 

B. usually requires that problem specific data be collected and interpreted.

 

C. may have to wait until after a situation analysis has been completed.

 

D. All of these alternatives are true.

A list of research questions that includes all the possible problem areas can be developed. Then, a situation analysis is carried out before narrowing down to final research objectives.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: Defining the Problem-Step 1
 

 

145. _____ is an informal study of what information is already available in the problem area.

A. Qualitative research

 

B. Situation analysis

 

C. A focus group interview

 

D. Quantitative research

 

E. A marketing model

A situation analysis is an informal study of what information is already available in the problem area. It can help define the problem.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

146. A situation analysis

A. usually involves formal talks with informed people.

 

B. can help define the problem.

 

C. should never involve a firm’s customers.

 

D. is a step that can often be skipped.

 

E. provides a controlled test of an hypothesis.

A situation analysis is an informal study of what information is already available in the problem area. It can help define the problem.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

147. During a “situation analysis,” a marketing researcher should:

A. collect primary data.

 

B. talk with competitors facing similar problems.

 

C. begin to talk informally to as many customers as possible.

 

D. study what information is already available.

 

E. All of these are good choices.

A situation analysis is an informal study of what information is already available in the problem area.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

148. Which of the following statements about doing a situation analysis is correct?

A. Libraries have good data on specific topics, but it is expensive to find.

 

B. It doesn’t make sense to start a situation analysis until the problem has begun to surface.

 

C. Much good data are available from the government, but expensive.

 

D. A good situation analysis is usually more expensive than collecting primary data.

 

E. None of these statements about doing a situation analysis is true.

When a marketing manager thinks the real problem has begun to surface, a situation analysis is useful. A situation analysis is an informal study of what information is already available in the problem area.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

149. When a marketing manager searches the Internet to find information about a research problem, this is an example of a(n):

A. intranet.

 

B. experiment.

 

C. hypothesis testing.

 

D. situation analysis.

 

E. data warehouse.

The situation analysis may begin with quick research—perhaps an Internet search, utilizing MIS, and phone calls or informal talks with people familiar with the industry, problem, or situation.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

150. When a marketing manager scans a firm’s MIS to try to obtain information about why the firm’s product sales are down, this is an example of a(n):

A. intranet.

 

B. hypothesis testing.

 

C. experiment.

 

D. data warehouse.

 

E. situation analysis.

The situation analysis may begin with quick research—perhaps an Internet search, utilizing MIS, and phone calls or informal talks with people familiar with the industry, problem, or situation.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

151. When a marketing manager has phone conversations with key wholesalers of the firm’s products to try to obtain information about why the firm’s product sales are down, this is an example of a(n):

A. hypothesis testing.

 

B. situation analysis.

 

C. data warehouse.

 

D. intranet.

 

E. experiment.

The situation analysis may begin with quick research—perhaps an Internet search, utilizing MIS, and phone calls or informal talks with people familiar with the industry, problem, or situation.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-02 Understand the scientific approach to marketing research.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

152. Which of the following statements about a situation analysis is False?

A. A situation analysis is mainly a study of new information that is not already available.

 

B. A situation analysis may involve informal discussions with knowledgeable people.

 

C. A situation analysis may help educate a researcher who is dealing with an unfamiliar subject.

 

D. A situation analysis should include finding relevant secondary data.

 

E. None of these statements about a situation analysis is False.

A situation analysis is an informal study of what information is already available in the problem area. It can help define the problem.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

153. A situation analysis is highly beneficial to marketers for all the following reasons except:

A. it is very informative.

 

B. it requires little time.

 

C. it is inexpensive compared to formal research efforts.

 

D. it requires only a phone or Internet access.

 

E. it yields relevant primary data.

A situation analysis is a method of gathering secondary data, not primary data. Secondary data is information that has been collected or published already.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

154. Which of the following is secondary data that is easily accessible to marketers and generated inside their own firms?

A. Focus group surveys

 

B. Library research

 

C. Marketing information system

 

D. U.S. government-published data

 

E. Internet research

A marketing information system (MIS) is an excellent source of secondary data generated from inside the firm.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

155. A company that sells equipment through independent wholesalers wants to find out why sales are down in one region. An analyst is asked to interview the wholesaler in that region. This seems to be

A. part of a situation analysis.

 

B. the beginning of a focus group interview.

 

C. gathering information that will be analyzed by a statistical package.

 

D. a bad practice, since the problem has not been defined yet.

 

E. None of these choices is correct.

The situation analysis may begin with quick research—perhaps an Internet search, utilizing MIS, and phone calls or informal talks with people familiar with the industry, problem, or situation.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

156. A marketing manager wants to know why her sales are down. She talks with several sales reps and finds that a competitor has introduced a successful new product. This “research” seems to be part of

A. the situation analysis.

 

B. the problem solution stage.

 

C. obtaining problem-specific data.

 

D. the data interpretation stage.

 

E. the problem definition stage of the research process.

The situation analysis may begin with quick research—perhaps an Internet search, utilizing MIS, and phone calls or informal talks with people familiar with the industry, problem, or situation.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

157. Data that has already been collected or published is:

A. useful data.

 

B. secondary data.

 

C. primary data.

 

D. free data.

 

E. rarely—if ever—useful for marketing decision making.

Secondary data refers to information that has been collected or published already.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

158. Data that has been collected or published already is:

A. primary data.

 

B. free.

 

C. franchised data.

 

D. secondary data.

 

E. None of these are good choices.

Secondary data refers to information that has been collected or published already.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

159. Which of the following statements concerning secondary data is correct?

A. Secondary data usually takes longer to obtain than primary data.

 

B. Secondary data is only available within the firm.

 

C. Secondary data was originally collected for some other purpose.

 

D. Secondary data may provide some background, but never provides the answer.

 

E. None of these statements is correct.

Data which have already been collected in a previous study are called secondary data.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

160. Secondary data

A. may provide some background, but never provides the answer.

 

B. is information that has been collected already.

 

C. is rarely available and is expensive.

 

D. is specifically collected to solve a current problem.

 

E. can be in the form of online surveys or observations.

Secondary data refers to information that has been collected or published already.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

161. Data which have already been collected in a previous study are called __________ data, while data that are generated by a phone survey this month of key customers are called _______ data.

A. primary; secondary

 

B. primary; intranet

 

C. secondary; primary

 

D. secondary; experimental

 

E. intranet; sample

Primary data is information specifically collected to solve a current problem. Secondary data refers to information that has been collected or published already.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Analyzing the Situation-Step 2
 

 

162. Secondary data is often available—at little or no cost—from:

A. both private and government sources.

 

B. the Internet.

 

C. trade associations.

 

D. company files.

 

E. All of these are good sources for secondary data.

Secondary data are available from libraries, the Internet, company’s files and reports, trade associations, government agencies, and private research organizations; they are available at little or no cost.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

163. All of the following are examples of secondary data sources EXCEPT:

A. Statistical Abstract of the United States.

 

B. a phone survey this month of past customers.

 

C. library sources.

 

D. trade association studies.

 

E. government reports.

Secondary data are available from libraries, the Internet, trade associations, government agencies, and private research organizations. A phone survey is primary data.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

164. The marketing manager at Massimino and McCarthy, a chain of retail stores that sells men’s clothing, is reviewing marketing research data to try to determine if changes in marketing strategy are needed. Which of the following sources of data would be a secondary data source?

A. Looking through the company’s marketing information system to see past sales trends.

 

B. Reviewing videotapes of a recent focus group.

 

C. Making phone calls to some of the best customers to learn their interest in a new line of clothing.

 

D. Spending time in stores observing customers’ behavior.

 

E. Looking through the results of an online customer satisfaction survey.

Secondary data refers to information that has been collected or published already. Ideally, much secondary data are readily available from the firm’s MIS.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 3 Hard
Topic: Analyzing the Situation-Step 2
 

 

165. Which of the following is NOT a secondary data source?

A. Company files

 

B. Intranet reports

 

C. Libraries

 

D. Private research organizations

 

E. Panels

See Exhibit 7-4.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

166. Which of the following is NOT true about search on the internet?

A. The internet provides information useful to marketing managers.

 

B. Search directories are useful for general information about a broader topic area.

 

C. Search engines have access to all information on the internet.

 

D. Sites like Complete Planet give a listing of more than 70,000 searchable databases.

 

E. Search engines like Google are useful when you have a pretty clear idea about what you are seeking.

Many managers don’t realize that much of the information stored on the Internet is in database formats that standard website search engines can’t find.

 

AACSB: Technology
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

167. Which of the following statements about using the Internet to gather secondary information is FALSE?

A. Internet searches often identify too many irrelevant sources.

 

B. Information on the Internet is readily available and very reliable.

 

C. Much of the information stored on the Internet is in database formats.

 

D. The key to the Internet is finding what’s needed.

 

E. Powerful Internet search engines provide lists of links to websites that include words specified by the researcher.

It is known that a treasure trove of useful information is found on the Internet. But all the available information is not reliable. Anyone can post anything on the Internet.

 

AACSB: Technology
Blooms: Apply
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

168. Searching the Internet, reviewing secondary data, and monitoring “chatter” on the web are inexpensive and informal ways for marketers to:

A. use a decision support system.

 

B. perform a situation analysis.

 

C. perform a focus group interview.

 

D. join a market research online community (MROC).

 

E. interpret data.

A situation analysis is an informal study of what information is already available in the problem area. It can help define the problem and specify what additional information is needed. The situation analysis may begin with quick research—perhaps an Internet search—and should also include a review of relevant secondary data or even “web chatter.”

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

169. Secondary data from federal government sources

A. is readily available, but there is usually not much information at state and local levels.

 

B. focuses mostly on agriculture.

 

C. is often very helpful for estimating the size of a market.

 

D. is only available from the Commerce Department in Washington.

 

E. None of these alternatives is correct.

Federal and state governments publish data on many subjects. These secondary data are often useful in estimating the size of markets.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

170. A good place for a marketing analyst to START looking for published statistical data is the:

A. Encyclopedia of Associations.

 

B. Congressional Record.

 

C. Wall Street Journal.

 

D. Statistical Abstract of the United States.

 

E. New York Times research files.

The Statistical Abstract of the United States provides a summary of statistics on the social, political, and economic organization of the United States. It is issued annually and can also be accessed online.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

171. The Statistical Abstract of the United States is a useful summary reference of the U.S. market prepared by the:

A. Bureau of Economic Analysis.

 

B. Internal Revenue Service.

 

C. U.S. Census Bureau.

 

D. International Trade Administration.

 

E. Small Business Administration.

The Statistical Abstract of the United States is issued annually and can also be accessed online (www.census.gov/compendia/statab/). It is useful for a summary of statistics.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

172. Which of the following is likely to be part of a situation analysis?

A. A marketing analyst looks up data in Advertising Age magazine about expenditures in the firm’s market.

 

B. A marketing researcher asks a trade association for one of its reports.

 

C. A marketing manager searches data.gov.

 

D. All of these are good choices.

The situation analysis should find relevant secondary data. These data are available from libraries, advertising agencies, newspapers, and magazines, Internet directories, trade associations, government agencies, and private research organizations.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 3 Hard
Topic: Analyzing the Situation-Step 2
 

 

173. Secondary data:

A. may not be specific enough to answer the question under consideration.

 

B. should be considered before primary data is collected.

 

C. is often all that is needed to solve a problem.

 

D. is available both internally and outside the firm.

 

E. All of these alternatives are correct.

Secondary data is data that has been collected or published already either internally or outside the firm. It may eliminate the need for further research and provide the solution. Primary data is collected when secondary data does not solve the problem.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

174. A situation analysis

A. can never eliminate the need for further research.

 

B. is used primarily in the problem solving step.

 

C. is expensive compared with more formal research efforts.

 

D. can be very informative, but takes little time.

 

E. must be quantitative to be useful.

The virtue of a good situation analysis is that it can be very informative but takes little time or money.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

175. Which of the following statements about secondary data is correct?

A. Secondary data is obtained only from sources outside of the firm.

 

B. Secondary data may be available much faster than primary data.

 

C. Results of “old” surveys are not secondary data.

 

D. Secondary data is usually more expensive to obtain than primary data.

 

E. None of these statements about secondary data is true.

Secondary data is readily available from many sources and can be extracted faster than primary data.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

176. Which of the following is most consistent with the marketing research process discussed in the text?

A. “We know that time is always short, so as soon as we define the problem we get on with our data collection.”

 

B. “We pay a lot for marketing research experts, so our managers don’t waste time trying to figure out how projects should be conducted.”

 

C. “We always use mail surveys, so that we won’t have to worry about nonresponse problems.”

 

D. “Secondary data is often all we need to solve our problems.”

 

E. None of the statements is a good answer.

In many instances, a situation analysis, which finds relevant secondary data, can help focus further research or even eliminate the need for it entirely.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

177. Which of the following statements about doing a situation analysis is correct?

A. There is very little government data on business and commercial markets.

 

B. Doing a good situation analysis is usually much less expensive than collecting primary data.

 

C. There is little value to having a marketing researcher involved because a good marketing manager is able to do what is required.

 

D. Doing a good situation analysis usually takes much longer than gathering primary data.

 

E. None of these statements about doing a situation analysis is true.

A situation analysis, which finds secondary data, is very informative and takes little time. Because secondary data is readily available at little or no cost it can be obtained cheaper than primary data.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

178. A fast-food chain is redesigning its restaurants. One of the main questions facing the chain’s management is, “Should the new restaurant design include a salad bar?” A researcher in the company finds an article in a restaurant trade magazine containing the results of a study about salad bars. The results indicate that salad bars are costly to maintain and are not a major attraction to consumers. Based on this information, management decides that it will not have a salad bar as part of the new restaurant design. This example illustrates the point that:

A. Situation analysis sometimes eliminates the need for conducting further research in a problem area.

 

B. Situation analysis is very costly in terms of time and money.

 

C. Secondary data from sources outside the company is always better than secondary data from sources inside the company.

 

D. Secondary data from private sources is always better than secondary data from government sources.

 

E. Collecting primary data is always necessary in order to make good decisions.

In many instances, a situation analysis, which finds relevant secondary data, can help focus further research or even eliminate the need for it entirely.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

179. Which of the following is probably NOT a part of a situation analysis?

A. A marketing manager asks a radio station for a copy of an audience study.

 

B. A marketing analyst determines from a Census publication how many manufacturers are in the Portland area.

 

C. A marketing analyst looks in the Index of Business Periodicals for articles about a large retail chain.

 

D. A computer company asks ten lawyers to participate in a focus group on how they use the internet.

 

E. All of these alternatives seem to be part of a situation analysis.

A situation analysis is an informal study dealing with the collection of secondary data, while the focus group is a method for collecting primary data.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 3 Hard
Topic: Analyzing the Situation-Step 2
 

 

180. A research proposal

A. develops and analyzes new information about a market.

 

B. specifies what information will be obtained and how.

 

C. is an informal study of what information is already available in the problem area.

 

D. seeks in-depth, open-ended responses, not yes or no answers.

 

E. is typically in a database format that standard website search engines can find.

A research proposal refers to a plan that specifies what information will be obtained and how. It may include information about costs, data collection, data analysis, and processing time.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

181. The research proposal may include information about all of the following except

A. what the costs will be.

 

B. who will analyze the data.

 

C. what data will be collected.

 

D. how long the process will take.

 

E. what the possible solutions are.

A research proposal refers to a plan that specifies what information will be obtained and how. It may include information about costs, data collection, data analysis, and processing time. It does not include possible solutions.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 1 Easy
Topic: Analyzing the Situation-Step 2
 

 

182. Which of the following is NOT likely to be included in a research proposal?

A. How long the research will take.

 

B. Preliminary recommendations on how to solve the problem.

 

C. Information about what the research will cost.

 

D. A description of what data will be collected.

 

E. A description of how data will be collected.

A research proposal refers to a plan that specifies what information will be obtained and how. It includes information about costs, data collection, data analysis, and processing time. It does not include possible solutions.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-03 Know about methods for collecting secondary and primary data.
Level of Difficulty: 2 Medium
Topic: Analyzing the Situation-Step 2
 

 

183. ____ is an example of a primary data source.

A. Cost data

 

B. A marketing information system

 

C. Company files

 

D. Observation

 

E. Library

In primary data collection, there are two basic methods for obtaining information about customers: questioning and observing. See Exhibit 7-4.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

184. Which of the following would be a source of primary data?

A. U.S. Census Bureau reports.

 

B. Company records on sales, costs, and advertising.

 

C. Market tests.

 

D. A Google search.

 

E. None of these is a good choice.

In primary data collection, there are two basic methods for obtaining information about customers: questioning and observing. Primary data collection includes market tests, focus group interviews, surveys, and observation studies.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

185. Which of the following would NOT be a source of primary data?

A. The Wall Street Journal

 

B. Market tests

 

C. Focus groups

 

D. Observation studies

 

E. Surveys

In primary data collection, there are two basic methods for obtaining information about customers: questioning and observing. Primary data collection includes market tests, focus group interviews, surveys, and observation studies.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

186. The two basic methods for obtaining primary information about customers are

A. defining and analyzing.

 

B. questioning and observing.

 

C. intranet and data from private research organizations.

 

D. marketing information systems and cost data.

 

E. Internet search and library search.

There are two basic methods for obtaining information about customers: questioning and observing. Questioning can range from qualitative to quantitative research. There are many kinds of observing.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

187. For marketers, the purpose of gathering primary data is usually:

A. to learn what customers think or how they behave in certain situations.

 

B. to specify what information needs to be obtained and how.

 

C. to monitor what others are saying online about the company or its products.

 

D. to define the problem that needs to be solved.

 

E. to help develop a hypothesis.

In most primary data collection, the researcher tries to learn what customers think about some topic or how they behave under some conditions. The two basic methods for obtaining information about customers are questioning and observing.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

188. When seeking problem-specific data through qualitative research, the researcher:

A. attempts to get yes or no answers from subjects.

 

B. creates strict guidelines to direct responses to questions.

 

C. tries to prevent the subject from giving open-ended responses.

 

D. seeks for subjects to share their honest thoughts on a topic without interference.

 

E. desires to obtain broad generalities from subjects.

Qualitative research seeks in-depth, open-ended responses, not yes or no answers. The researcher tries to get people to share their thoughts on a topic—without giving them many directions or guidelines about what to say.

 

AACSB: Analytic
Blooms: Analyze
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

189. The _____ is a qualitative research method in which an interviewer asks very broad questions that encourage the interviewee to provide details.

A. data warehouse

 

B. non-directive interview

 

C. response rate

 

D. consumer panel

 

E. situation analysis

With non‐directive interviews, an interviewer asks very broad questions that encourage the interviewee to provide details. Follow up questions might just ask the respondent to elaborate.

 

AACSB: Reflective Thinking
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

190. Which of the following statements explains why marketers use focus groups to conduct research?

A. People may not feel free to express their honest thoughts in groups.

 

B. Some individuals may dominate group discussion.

 

C. 6 to 10 people provide feedback to marketing questions in a single event.

 

D. The results cannot be measured objectively.

 

E. Conclusions reached from a session usually vary depending on the viewpoint of the researcher.

Unlike an interview, which produces answers from one interviewee, focus groups generate answers from up to ten participants in a single event.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

191. In quantitative research, it is common for researchers to ask questions and offer a variety of fixed answers from which to choose-such as multiple-choice questions. This approach is advantageous for all the following reasons except:

A. responses can be summarized in percentages, averages, or other statistics.

 

B. it simplifies analysis of the replies.

 

C. it is more convenient for computer analysis.

 

D. respondents may reply faster and easier.

 

E. it limits the broad range of possible answers to ones envisioned by the researchers.

One disadvantage of quantitative research is that it is based upon structured responses that have the potential to limit respondents to fixed answers that may not reflect their own experiences and opinions.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

192. Since marketers can’t collect information from everyone, they collect information from a small number of people taken from the larger group they are analyzing-a sample. This technique is effective when:

A. the sample group is representative of the larger population.

 

B. the sample group is different from the larger population.

 

C. the sample group provides identical responses.

 

D. the sample group is questioned using online surveys.

 

E. the sample group is questioned using personal interviews.

Marketing researchers typically study only a sample, a part of the relevant population. How well a sample represents the total population affects the results. Results from a sample that is not representative may not give a true picture.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

193. To get problem-specific data, a marketing researcher would use:

A. the experimental method.

 

B. a questioning method.

 

C. an observing method.

 

D. consumer panels and focus groups.

 

E. Any or all of these could be used.

There are different methods for collecting problem-specific data. It includes questioning method, observing method, experimental method, use of consumer panels, and focus groups.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

194. Qualitative research, compared to quantitative research:

A. Asks closed-ended questions.

 

B. Asks yes or no type questions.

 

C. Provides more representative samples of consumers.

 

D. Relies on open-ended questioning.

 

E. Uses statistics to analyze data.

Qualitative research seeks in-depth, open-ended responses, not yes or no answers; quantitative research seeks structured responses.

 

AACSB: Analytic
Blooms: Create
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

195. “Qualitative research” involves:

A. talks with the firm’s own managers.

 

B. questioning to obtain in-depth open-ended responses.

 

C. “yes-no” questionnaires.

 

D. studying secondary data.

 

E. None of these is a good choice.

Qualitative research seeks in-depth, open-ended responses, not yes or no answers.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

196. The big advantage of qualitative research in marketing is:

A. ease of interpretation.

 

B. it provides a good basis for statistical analysis.

 

C. the in-depth responses it provides.

 

D. the analysis can be handled on a personal computer.

 

E. None of these is a good answer.

Qualitative research seeks in-depth, open-ended responses, not yes or no answers. The real advantage of this approach is depth.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

197. _____ are one widely used form of qualitative questioning in marketing research.

A. Focus group interviews

 

B. Situation analyses

 

C. Telephone surveys

 

D. Direct observations of customers

 

E. Experimental research studies

One widely used form of qualitative questioning in marketing research is the focus group interview, which involves interviewing 6 to 10 people in an informal group setting.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

198. An interview with 6 to 10 people in an informal group setting is called a(an):

A. secondary interview.

 

B. focus group interview.

 

C. observation interview.

 

D. quantitative research interview.

 

E. informal investigation.

Focus group interview involves interviewing 6 to 10 people in an informal group setting. It is a form of qualitative questioning in marketing research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

199. Focus groups

A. stimulate discussion among participants.

 

B. involve interviewing people in a formal setting.

 

C. use close-ended, yes or no questions.

 

D. are the same as opinion leaders.

 

E. are the same as reference groups.

Focus group interview, a form of qualitative questioning, uses open-ended questions; group interaction is preferred to stimulate thinking and get immediate reactions.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

200. With focus group interviews,

A. consumers talk as a group for about 10 minutes, and then meet individually with an interviewer.

 

B. it is typical for the researcher to develop quantitative summaries of the results.

 

C. marketing managers can estimate the size of the market for a new product.

 

D. the objective is to get the group to interact, so that many ideas are generated.

 

E. researchers try to select a large sample so they can extend the results to the whole population.

Focus group interview, a form of qualitative questioning, uses open-ended questions; group interaction is preferred to stimulate thinking and get immediate reactions.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

201. A consumer products manufacturer wants consumer reaction to its existing products. Interaction is considered important to stimulate thinking. The firm should use:

A. the observation method.

 

B. focus group interviews.

 

C. the GSR (galvanic skin response) method.

 

D. quantitative interviews.

 

E. telephone interviews.

Focus group interview, a form of qualitative questioning, uses open-ended questions; group interaction is preferred to stimulate thinking and get immediate reactions.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

202. Focus groups:

A. Are usually composed of 15-25 people.

 

B. Yield results that are largely dependent on the viewpoint of the researcher.

 

C. Always do a good job of representing the broader target market.

 

D. Are expensive compared to other marketing research methods.

 

E. Are conducted in a formal group setting.

A typical problem with focus groups is that the results seem to depend largely on the viewpoint of the researcher. This is considered a serious limitation of focus groups.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

203. When focus group interviews are used in marketing,

A. each person in the group answers the same questionnaire, to focus the discussion.

 

B. the typical group size is 15 to 20 typical consumers whether online or off-line.

 

C. it is primarily as a follow-up to more quantitative research.

 

D. the research conclusions will vary depending on who watches the interview whether online or off-line.

 

E. the consumer in the group who knows the most about the topic is asked to lead the discussion.

Regardless of how a focus group is conducted, conclusions reached from a session usually vary depending on who watches it. It’s hard to measure the results objectively.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

204. One of the major disadvantages of the focus group interview approach is that

A. ideas generated by the group can’t be tested later with other research.

 

B. it is difficult to measure the results objectively.

 

C. it is difficult to get in-depth information about the research topic.

 

D. there is no interviewer, so the research questions may not be answered.

 

E. once the interview is over there is no way for a marketing manager who was not there to evaluate what went on.

In qualitative research, a typical problem with focus groups is that it’s hard to measure the results objectively. It is considered as a serious limitation of focus groups.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

205. A typical cost for a focus group interview of 6 to 10 participants is about:

A. $1,000.

 

B. $2,000.

 

C. $3,000.

 

D. $4,000.

 

E. $5,000.

Focus groups can be conducted quickly and at relatively low cost at an average of about $4,000 each; this is part of their appeal.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

206. Marketing research which seeks structured responses that can be summarized is called:

A. focus group research.

 

B. quantitative research.

 

C. qualitative research.

 

D. situation analysis research.

 

E. open-ended research.

Quantitative research is a survey research which seeks structured responses that can be summarized in numbers, like percentages, averages, or other statistics.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

207. Which of the following is a disadvantage of quantitative research (compared to qualitative research)?

A. It is harder to get in-depth answers.

 

B. The conclusions are likely to vary more from analyst to analyst.

 

C. The results are harder to summarize.

 

D. It is not as fast for respondents.

 

E. None of these is a disadvantage of quantitative research.

Qualitative research seeks in-depth, open-ended responses, not yes or no answers; quantitative research seeks structured responses.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

208. Wizard Toy Company’s marketing researcher conducted a survey to find out the percentage of customers who, after receiving a promotional mailing about a new toy, actually went out and purchased the product. This is an example of

A. a response rate.

 

B. cross-tabulation.

 

C. personal interviews.

 

D. quantitative research.

 

E. an experimental method.

Quantitative research is a survey research which seeks structured responses that can be summarized in numbers, like percentages, averages, or other statistics.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 3 Hard
Topic: Getting Problem-Specific Data-Step 3
 

 

209. Quantitative research:

A. Involves structured responses that can be summarized.

 

B. Is not a good method for measuring consumer attitudes and opinions.

 

C. Mainly uses small samples of respondents.

 

D. Is only possible by using a mail survey.

 

E. Relies on open-ended responses to survey questions instead of multiple-choice responses.

Quantitative research is a survey research which seeks structured responses that can be summarized in numbers, like percentages, averages, or other statistics.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

210. Quantitative marketing research

A. usually makes it easier and faster for respondents to answer the questions (compared to qualitative research).

 

B. can use a large, representative sample.

 

C. data can be collected by mail, e-mail, online, telephone, or personal interviews.

 

D. makes it easier for the research analyst to summarize answers.

 

E. All of these choices are correct.

The advantages of quantitative marketing research are: convenience of the respondents, larger and more representative samples, different methods of contacts like by mail, e-mail, online, phone, or in person, and use of various statistics to draw conclusions.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

211. Mail surveys:

A. may be more successful than personal interviews for getting personal information.

 

B. are often limited by low response rates.

 

C. are popular because they can be a convenient and economical approach.

 

D. All of these alternatives are true.

The advantages of mail surveys are convenience of the respondents, willingness to provide personal information, and economical approach; but the response rate is low.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

212. A marketing researcher wants to get sensitive information about family spending patterns as part of a survey. He is most likely to get the needed information

A. with a mail, e-mail, or online survey.

 

B. with a focus group.

 

C. with personal interviews.

 

D. with telephone interviews.

 

E. Any of these choices is about equally effective for getting sensitive information.

The respondents may be more willing to provide personal information when a questionnaire can be completed anonymously in a mail, e-mail, or online survey.

 

AACSB: Reflective Thinking
AACSB: Technology
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

213. Which of the following is NOT an advantage of mail surveys as a method of quantitative research?

A. Ability to do extensive questioning.

 

B. Ability of the respondent to complete the survey at his/her convenience.

 

C. Greater willingness of the respondent to provide personal information.

 

D. High response rates.

 

E. Low cost relative to personal interview surveys.

Mail, e-mail, and online surveys have poor response rate.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

214. A marketing researcher wants to do a survey to probe in-depth consumer attitudes about their experiences with the company’s products. He is LEAST likely to get what he wants if he uses:

A. personal interviews.

 

B. online focus groups.

 

C. telephone interviews.

 

D. a mail survey.

 

E. None of these choices is very useful for getting in-depth information about consumer attitudes.

In mail surveys, the respondents cannot expand on particular points to give in-depth answers; the questions must be simple and easy to follow since no interviewer is there to help.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

215. A firm intends to use an online survey questionnaire in a marketing research project. Compared to a mail survey:

A. feedback will likely be faster online.

 

B. the response rate will likely be lower online.

 

C. respondents will likely be younger and better educated online.

 

D. costs will likely be less online.

 

E. All of these alternatives are correct.

Distributing questionnaires by e-mail or at a website is quick and the responses come back in computer form; the response rate is low; economical; people who participate tend to be younger, better educated computer users.

 

AACSB: Technology
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

216. The percent of people contacted in a survey who complete a questionnaire is the:

A. qualitative rate.

 

B. sample rate.

 

C. population rate.

 

D. response rate.

 

E. None of these choices is a good answer.

Response rate is the percentage of people contacted who complete the questionnaire in a survey.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

217. The percent of people contacted who complete a survey questionnaire is the:

A. response rate.

 

B. sample base unit (SBU) rate.

 

C. population rate.

 

D. sample rate.

 

E. hit rate.

Response rate is the percentage of people contacted who complete the questionnaire in a survey.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

218. Which of the following is NOT an advantage of telephone surveys?

A. They are effective for getting answers to simple questions.

 

B. They usually can be conducted quite quickly.

 

C. They are especially good for getting confidential and personal information.

 

D. Response rates are high.

 

E. All of these alternatives are advantages of telephone surveys.

Telephone interviews are popular and effective for getting quick answers; but, respondents are concerned about who is calling or how personal information is used, which can be considered a disadvantage.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

219. Which method of quantitative research would probably produce the best results when the questions are simple and require only quick “yes” or “no” answers?

A. Telephone interviews.

 

B. Focus group interviews.

 

C. Mail questionnaires.

 

D. Personal interviews.

 

E. Observation.

Telephone interviews are popular; they are effective for getting quick answers to simple questions.

 

AACSB: Technology
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

220. Which method of data collection is typically best when you want respondents to quickly answer a small number of fairly simple questions?

A. Telephone

 

B. Mail

 

C. Observation

 

D. Experiment

 

E. Secondary

Telephone interviews are popular; they are effective for getting quick answers to simple questions.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

221. Which of the following is usually the most expensive way to collect data from consumers?

A. Telephone surveys

 

B. E-mail surveys

 

C. Online surveys

 

D. Mail surveys

 

E. Personal interviews

Though personal interviews are commonly used for research on business customers, they are usually much more expensive per interview than e-mail, online, mail, or telephone surveys.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

222. Business market researchers commonly use ______________ because of their flexibility.

A. mail questionnaires

 

B. focus group interviews

 

C. personal interviews

 

D. telephone interviews

 

E. None of these choices is a good answer.

Personal interviews are commonly used by business market researchers for research on business customers, as these interviews are flexible.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

223. Which variation of personal interview surveys helps reduce the cost of locating consumer respondents?

A. Pull interviews

 

B. Mall intercept interviews

 

C. Push interviews

 

D. Perception interviews

To reduce the cost of locating consumer respondents, interviews are sometimes done at a store or shopping mall; this is called a mall intercept interview which is a variation of personal interview survey.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

224. Which of the following research methods can not be employed in a market research online community?

A. brainstorming sessions

 

B. focus groups

 

C. surveys

 

D. personal interviews

 

E. All of these methods can be used with a market research online community.

Members spend months, possibly years, online together brainstorming ideas and conversing with other customers and the firm’s marketing managers. Communities often include online focus groups and question-and-answer sessions, as well as quantitative approaches like polls and surveys.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 3 Hard
Topic: Getting Problem-Specific Data-Step 3
 

 

225. A _____ is an online group of participants joined together by a common interest, and who participate in ongoing research.

A. experiment

 

B. mutual research network

 

C. family intercept

 

D. focus group

 

E. market research online community

A market research online community (MROC) is an online group of participants who are joined together by a common interest, and who participate in ongoing research.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

226. The observing method in marketing research:

A. uses personal interviews.

 

B. may require customers to change their normal shopping behavior.

 

C. is used to gather data without consumers being influenced by the process.

 

D. is not suitable for obtaining primary data.

 

E. None of these alternatives is correct.

With the observation method, researchers try to see or record what the subject does naturally. They don’t want the observing to influence the subject’s behavior.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

227. What would be the best way for the marketing manager of a supermarket to find out how consumers move through the store?

A. Have an interviewer go through the store with each customer.

 

B. Observe customers with hidden cameras.

 

C. Give customers a questionnaire after they have finished shopping.

 

D. Install checkout counters at the end of each aisle.

 

E. None of these alternatives would be very good.

With the observation method, researchers try to see or record what the subject does naturally. Observing does not influence the subject’s behavior. Consumers are recorded on video; this may be in a store, at home or out with friends.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

228. Which of the following is NOT a good example of the observation method of marketing research?

A. The manager of a supermarket occasionally walks through the store to see what customers are doing.

 

B. A drugstore installs optical scanners at its checkout counters.

 

C. The owner of a shopping center puts a counting device at the entrance to count how many cars come in.

 

D. A store manager studies videotapes of consumers shopping in the store.

 

E. All of these are good examples of observation research.

In the observation method, researchers try to see or record what the subject does naturally. They don’t want the observing to influence the subject’s behavior. Walking through the store occasionally is not a good example.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Getting Problem-Specific Data-Step 3
 

 

229. In a grocery store’s “valued customer” program, every shopper gets a card that he/she presents to the clerk in the checkout aisle. The card is scanned along with the customer’s groceries. The store’s computer system tracks each shopper’s purchases and automatically provides special valued customer discounts. Every month, the customers in the program receive a newsletter containing coupons that are based on the customer’s purchase history. For example, someone purchasing a lot of baby formula and disposable diapers might get a coupon for a free box of baby wipes. This valued customer program is based to a large extent on which of the following types of research?

A. Questioning.

 

B. Experimentation.

 

C. Observation.

 

D. Online surveys.

 

E. Personal interviews.

Some researchers use observation techniques to study customers. Computerized scanners at retail checkout counters help researchers collect very specific and useful information. Valued customer programs provide even more details about specific customers.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

230. When a Walmart clerk checks out a customer by scanning the bar codes of items in the customer’s shopping basket, this is an example of what type of research?

A. Observation

 

B. Experiment

 

C. Phone

 

D. Mail

 

E. Secondary

Computerized scanners at retail checkout counters help researchers collect very specific and useful information. This represents the observation method of quantitative research.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

231. Information is obtained on a continuing basis from the same respondents using a:

A. contributor group.

 

B. consumer panel.

 

C. responder group.

 

D. consumer experiment.

 

E. statistical package.

Consumer panel refers to a group of consumers who provide information on a continuing basis; using consumer panels is one method of collecting problem-specific data.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

232. Joy Rinaldo has agreed to participate in marketing research in which she will provide information about her purchases on an ongoing basis. She is probably part of a:

A. confidence interval.

 

B. statistical package.

 

C. contributor group.

 

D. consumer panel.

 

E. focus group.

Consumer panel refers to a group of consumers who provide information on a continuing basis; using consumer panels is one method of collecting problem-specific data.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

233. Whenever John shops for groceries, he gives an ID card to the clerk, who scans the number. Then the scanner records every purchase—including brands, sizes, prices, and any coupons used. John is most probably a

A. licensed purchaser.

 

B. consumer panel member.

 

C. market researcher.

 

D. focus group leader.

 

E. opinion leader.

Whenever a consumer panel member shops for groceries, he or she gives an ID card to the clerk, who scans the number. The scanner records every purchase—including brands, sizes, prices, and any coupons used.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 3 Hard
Topic: Getting Problem-Specific Data-Step 3
 

 

234. The ______________ method is an information gathering method in which the responses of groups which are similar—except on the characteristic being tested—are compared.

A. focus group

 

B. random

 

C. observing

 

D. experimental

 

E. qualitative questioning

With the experimental method, researchers compare the responses of two or more groups that are similar except on the characteristic being tested; this is one method of collecting problem-specific data.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

235. When using __________, researchers compare the responses of two or more groups that are similar except on the characteristic being tested.

A. response rates

 

B. consumer panels

 

C. experimental method

 

D. personal interview surveys

 

E. opinion leader analysis

In the experimental method, researchers compare the responses of two or more groups that are similar except on the characteristic being tested; this is one method of collecting problem-specific data.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

236. Two similar groups of consumers are shown different magazines which include the same ad. Then each consumer is asked questions about the advertised product. This seems to be a description of

A. the experimental method.

 

B. a set of focus group interviews.

 

C. a consumer panel research project.

 

D. a set of personal interviews.

 

E. None of these alternatives is a good answer.

In the experimental method, researchers compare the responses of two or more groups that are similar except on the characteristic being tested.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

237. A marketing manager wants to know if a “2 for 1” coupon will attract new customers. He will get the most persuasive results if he uses

A. a focus group to ask consumers if they like the idea.

 

B. an experimental method in which only some consumers get the coupon and the purchases of the two groups (with and without coupons) are compared.

 

C. personal interviewers to ask consumers how they will react.

 

D. a mail survey to ask consumers if they use coupons and why.

 

E. None of these would allow the manager to determine if the coupon will help get new customers.

This refers to the experimental method, where the researcher can compare the responses of two or more groups that are similar except on the characteristic being tested; consumers with and without coupons can be compared.

 

AACSB: Reflective Thinking
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

238. Test-marketing is an example of a(n):

A. Mail survey.

 

B. Focus group.

 

C. Situation analysis.

 

D. Telephone survey.

 

E. Experiment.

Test-marketing of new products is a type of marketing experiment. The company is trying variations on its planned marketing mix in a few geographic areas.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

239. The Cereal Bar, a fast-food restaurant that sells breakfast cereal, wanted to see if a different price for its Wild O’s breakfast special would affect demand. So the marketing manager used ________ when she tested two different prices at two different stores and compared sales.

A. idea testing

 

B. segmentation research

 

C. experimental method

 

D. test-marketing

 

E. focus groups

Test-marketing is a type of marketing experiment. A company can try variations on its planned marketing mix in a few geographic market areas. The results help to identify problems or refine the marketing mix before making decisions.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

240. Marketing research experiments

A. may be difficult to set up in real world situations.

 

B. may involve a combination of observing and questioning.

 

C. may be disrupted by competitors’ promotion efforts.

 

D. may be disrupted by competitors’ pricing efforts.

 

E. All of these alternatives are true.

Successful experiments may involve both observing and questioning. They are hard to set up in the real world. Competitors may disrupt test-marketing by increasing promotion or offering retailers extra discounts.

 

AACSB: Reflective Thinking
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

241. About ______________ percent of marketing research spending is for syndicated research.

A. 10

 

B. 25

 

C. 40

 

D. 60

 

E. 75

About 40 percent of marketing research spending is for syndicated research. This is economical when different firms need the same type of data.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

242. ______ research accounts for about 40 percent of marketing research spending.

A. Experimental method

 

B. Observation method

 

C. Syndicated

 

D. Cross-tabulation

 

E. Online survey

About 40 percent of marketing research spending is for syndicated research. This is economical when different firms need the same type of data.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

243. About what percentage of marketing research spending is for syndicated research data?

A. 20 percent

 

B. 30 percent

 

C. 40 percent

 

D. 50 percent

 

E. 60 percent

About 40 percent of marketing research spending is for syndicated research. This is economical when different firms need the same type of data.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 2 Medium
Topic: Getting Problem-Specific Data-Step 3
 

 

244. Which of the following statements about the cost and value of information is False?

A. Dependable information can be expensive.

 

B. Managers rarely get all the information they would like to have.

 

C. Money may be wasted if a manager ignores the facts revealed in a marketing research study and bases his/her decisions on guesswork.

 

D. The cost of gathering additional information is always justified by its value.

 

E. All of these statements are False.

The value of additional information lies in its ability to help design more effective marketing strategies. If it doesn’t help to do that, then it’s definitely of less value. Similarly, different research methods provide different insights and come at different costs.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-04 Understand the role of observing; questioning; and using experimental methods in marketing research.
Level of Difficulty: 1 Easy
Topic: Getting Problem-Specific Data-Step 3
 

 

245. Statistical packages are:

A. easy-to-use computer programs that analyze data.

 

B. syndicated research services that do quantitative research.

 

C. procedures used to be sure that a sample is representative.

 

D. product packages that make it possible to collect data at checkout counters.

 

E. None of these alternatives is a good answer.

Statistical packages are easy-to-use computer programs that analyze data and facilitate data interpretation.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

246. This frequently used approach for analyzing and interpreting marketing research data shows the relationship of answers to two different questions.

A. Observation

 

B. Focus group interviews

 

C. Online response rates analysis

 

D. Experimental approach

 

E. Cross-tabulation

Cross-tabulation is one of the most frequently used approaches for analyzing and interpreting marketing research data. It shows the relationship of answers to two different questions.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

247. The total group a survey researcher is interested in is called the:

A. population.

 

B. sample.

 

C. study group.

 

D. representative group.

 

E. None of these choices is a good answer.

The term ‘population’ refers to the total group the researcher is interested in.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

248. The part of the relevant population that is surveyed by a researcher is called the:

A. representative group.

 

B. focal group.

 

C. target population.

 

D. sample.

 

E. research group.

The term ‘sample’ refers to a part of the relevant population that is surveyed by a researcher. How well a sample represents the total population affects the results.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

249. The response rate to a survey affects

A. who is in the population for a marketing research study.

 

B. whether a statistical package can be used to analyze the data.

 

C. how representative the sample is.

 

D. All of these alternatives are good answers.

How well a sample represents the total population affects the results. Results from a sample that is not representative may not give a true picture.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Other: Self-Test
Topic: Interpreting the Data-Step 4
 

 

250. Regarding an estimate from a survey, the range on either side of the survey result that is likely to contain the “true” value of the relevant population is called:

A. sample range.

 

B. accuracy range.

 

C. confidence interval.

 

D. validity interval.

 

E. population estimate.

Confidence interval is the range on either side of an estimate that is likely to contain the true value for the whole population. Some managers are surprised to learn how wide that range can be.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

251. By computing confidence intervals a researcher can:

A. have just as much confidence in an estimate from a small sample.

 

B. offset some of the problems of having a nonrepresentative sample.

 

C. estimate how precise her research results are likely to be.

 

D. None of these alternatives is a good answer.

Researchers can employ confidence intervals to help determine the likely accuracy of the sample value.

 

AACSB: Analytic
Blooms: Understand
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 2 Medium
Topic: Interpreting the Data-Step 4
 

 

252. ______________ is concerned with whether the research data measures what it is intended to.

A. Cross-tabulation

 

B. Validity

 

C. Regularity

 

D. Dependability

 

E. Confidence

Validity concerns the extent to which data measure what they are intended to measure. Validity problems are important in marketing research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

253. _________ concerns the extent to which data measures what it is intended to measure.

A. Conformance

 

B. Reliability

 

C. Depth

 

D. Validity

 

E. Penetration

Validity concerns the extent to which data measure what they are intended to measure. Validity problems are important in marketing research.

 

AACSB: Analytic
Blooms: Remember
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

254. Which of the following is an ethical problem in marketing research?

A. A researcher does not disclose problems that occurred during consumer interviews.

 

B. A company calls consumers under the guise of doing research when the phone calls are really sales pitches for the company’s products.

 

C. A manager informs a researcher that the only acceptable results are ones that confirm the manager’s existing viewpoints.

 

D. A researcher deliberately withholds details about how a research study was conducted.

 

E. All of these statements illustrate ethical problems in marketing research.

Ethical problems can include: not disclosing problems in the interview process; misrepresentation of research goals; selective sharing of research results; withholding details of how research was conducted; and many others.

 

AACSB: Ethics
Blooms: Understand
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Interpreting the Data-Step 4
 

 

255. Which of the following statements is True regarding the last step in the marketing research process—solving the problem?

A. In this step, managers use the research results to make decisions.

 

B. Research needs to have action implications to have value.

 

C. Managers should be able to apply the research findings to marketing strategy planning.

 

D. Research that does not provide information that is useful for decision-making is a waste of time and money.

 

E. All of these statements are True.

Managers use the research results for decision-making. They should apply the findings in marketing strategy planning. If research doesn’t have action implications, it has less value and if it doesn’t provide information for decision-making, it is a waste of time and money.

 

AACSB: Analytic
Blooms: Apply
Learning Objective: 07-05 Understand the challenges to interpreting marketing research data.
Level of Difficulty: 1 Easy
Topic: Solving the Problem-Step 5
 

 

256. Regarding international marketing research:

A. If a firm is well established internationally, there is nothing to be gained from working with local market research firms in the countries of interest.

 

B. It is impossible to coordinate similar marketing research efforts under way in several countries due to language and cultural differences.

 

C. Accurate data (both primary and secondary data) may be hard to find in international markets.

 

D. It is impossible to standardize the elements of an international marketing information system.

 

E. None of these alternatives is true.

In many countries, it is difficult for a foreigner to gather accurate information for marketing research, because of rapid economic growth and poor explanation methods for data collection.

 

AACSB: Diversity
Blooms: Understand
Learning Objective: 07-06 Recognize how market research information aids marketing planning in international markets.
Level of Difficulty: 1 Easy
Topic: International Marketing Research