Creating Customer Value and Engagement Part II

34) Customer-driven marketing is most effective when ________. A) a clear need exists among customers, but the need is difficult to identify B) customers do not know what they want but are easily persuaded C) customers seek new products and technological innovations D) clear needs exist and customers know what they want E) customers have wants but cannot afford them Answer: D 35) ________ companies research customers deeply to learn about their desires, gather new product ideas, and test product improvements. A) Production-oriented B) Customer-driving C) Customer-driven D) Functional E) Societal Answer: C 36) The ABC, a leading provider of personal computer systems, began manufacturing tablet devices after predicting a future consumer need for portability. Which of the following was most likely implemented by the ABC company? A) the selling concept B) customer-driving marketing C) the product concept D) sustainable marketing E) the production concept Answer: B 37) The societal marketing concept holds that ________. A) consumers will not buy enough of a firm's products unless the firm undertakes a large-scale selling and promotion effort B) a company's marketing decisions should focus on creating economic value in a way that also creates value for the surrounding environment C) the society will only favor products that are available and highly affordable D) achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do E) consumers will favor products that offer the most in quality, performance, and innovative features Answer: B 38) Many leading business and marketing thinkers are now preaching the concept of "shared value" which recognizes that ________ needs, not just economic needs, define markets. A) functional B) marketing C) individual D) societal E) physical Answer: D 39) Which of the following concepts calls for sustainable marketing? A) the societal marketing concept B) the marketing concept C) the selling concept D) the production concept E) the product concept Answer: A 40) Cosmetic retailer Lush knows that doing what's right benefits both customers and the company. Their premium beauty products are made by hand from the freshest possible natural ingredients. This is an example of the ________ concept. A) marketing B) product C) production D) societal marketing E) selling Answer: D 41) ________ marketing is defined as socially and environmentally responsible marketing that meets the present needs of consumers and businesses while also preserving or enhancing the ability of future generations to meet their needs. A) Customer-driven B) Mass C) Sustainable D) Customer-driving E) Ambush Answer: C 42) The product concept is a customer-centered, sense-and-respond philosophy. Answer: FALSE 43) A brand's value proposition is the set of benefits or values it promises to deliver to consumers to satisfy their needs. Answer: TRUE 44) The selling concept holds that consumers will favor products that offer the most in quality, performance, and innovative features. Answer: FALSE 45) Xenon Corp. releases frequent updates to improve its expensive software products. This marketing approach used by the firm is most likely based on the production concept. Answer: FALSE 46) Organizations that follow the production concept most likely practice socially and environmentally responsible marketing. Answer: FALSE 47) Product, price, place, and promotion make up the elements of a firm's marketing mix. Answer: TRUE 48) Why do companies generally divide a market into segments of customers? Answer: A company decides whom it will serve by dividing the market into segments of customers and selecting which segments it will go after. Some people think of marketing management as finding as many customers as possible and increasing demand. But marketing managers know that they cannot serve all customers in every way. By trying to serve all customers, they may not serve any customer well. Hence, companies usually want to select only customers that they can serve well and profitably. Ultimately, marketing managers must decide which customers they want to target and on the level, timing, and nature of their demand. 49) Compare and contrast the product and production concepts. Answer: The production concept holds that consumers will favor products that are available and highly affordable. Therefore, it dictates that management should focus on improving production and distribution efficiency. This concept is one of the oldest orientations that guides sellers. The production concept is still a useful philosophy in some situations. For example, both personal computer maker Lenovo and home appliance maker Haier dominate the highly competitive, price-sensitive Chinese market through low labor costs, high production efficiency, and mass distribution. However, although useful in some situations, the production concept can lead to marketing myopia. Companies adopting this orientation run a major risk of focusing too narrowly on their own operations and losing sight of the real objective – satisfying customer needs and building customer relationships. The product concept holds that consumers will favor products that offer the most in quality, performance, and innovative features. Under this concept, marketing strategy focuses on making continuous product improvements. Product quality and improvement are important parts of most marketing strategies. However, focusing only on products can also lead to marketing myopia. For example, manufacturers of mousetraps might believe that if they can build a better mousetrap, their profits will soar but they are often rudely shocked. Buyers may be looking for a better solution to a mouse problem but not necessarily for a better mousetrap. The better solution might be a chemical spray, an exterminating service, a house cat, or something else that suits their needs even better than a mousetrap. Furthermore, a better mousetrap will not sell unless the manufacturer designs, packages, and prices it attractively, places it in convenient distribution channels, brings it to the attention of people who need it, and convinces buyers that it is a better product. 50) Compare the selling and marketing concepts, and list the key components of each concept. Answer: The selling concept reflects an inside-out perspective, while the marketing concept takes an outside-in perspective. The selling concept is typically practiced when an organization markets products or services that buyers do not normally think of purchasing, such as insurance or blood donation. Aggressive selling focuses on creating sales transaction rather than on building long-term relationships with customers, with the aim of selling what a company makes rather than making what the customer wants. The marketing concept, on the other hand, is based on identifying the needs and wants of target markets and then satisfying those needs and wants better than competitors do. Under the marketing concept, customer focus and value are the paths to sales and profits. Instead of a product-centered make-and-sell philosophy, the marketing concept is a customer-centered sense-and-respond philosophy. The job is not to find the right customers for a product but to find the right products for customers. 51) Briefly explain the societal marketing concept. Answer: The societal marketing concept questions whether the pure marketing concept overlooks possible conflicts between consumer short-run wants and consumer long-run welfare. Is a firm that satisfies the immediate needs and wants of target markets always doing what's best for its consumers in the long run? The societal marketing concept holds that marketing strategy should deliver value to customers in a way that maintains or improves both the consumer's and society's well-being. It calls for sustainable marketing, socially and environmentally responsible marketing that meets the present needs of consumers and businesses while also preserving or enhancing the ability of future generations to meet their needs. Companies like GE, Dow, Google, IBM, and Nestle are concerned not just with short-term economic gains, but with the well-being of their customers, the depletion of natural resources vital to their businesses, the viability of key suppliers, and the economic well-being of the communities in which they produce and sell. 52) The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction is referred to as ________. A) perceived-value management B) societal marketing C) customer relationship management D) partner relationship management E) enterprise resource planning Answer: C 53) Which of the following terms refers to a customer's evaluation of the difference between all the benefits and all the costs of a market offering relative to those of competing offers? A) customer-perceived value B) customer equity C) share of customer D) customer profitability E) customer lifetime value Answer: A 54) A Steinway piano–any Steinway piano–costs a lot. But to those who own one, a Steinway is a great value. This is an example of ________. A) share of customer B) customer perceived value C) customer share D) customer lifetime value E) customer experience Answer: B 55) Ritz-Carlton is fervently dedicated to anticipating customers' slightest needs. Without ever asking, they seem to know when customers want a king-size bed, non-allergenic pillow, extra body gel, or the blinds open upon arrival. An amazing 95 percent of departing guests report that their stay has been a truly memorable experience. This is an example of ________. A) customer delight B) customer lifetime value C) customer equity D) customer share E) customer-perceived value Answer: A 56) Customer evangelists are those who ________. A) use personal selling methods to market products and services B) spread the word about their good experiences with a brand or product C) use their expertise to influence people about specific products D) work with quality-assurance teams to improve product safety E) evaluate newly launched products in the marketplace Answer: B 57) In which of the following circumstances is an organization likely to engage in full partnerships with key consumers? A) when the market has few customers and high margins B) when the market has a huge number of customers C) when the firm has a frequency marketing program D) when the firm has a large number of low-margin customers E) when the firm has few marketing resources at its disposal Answer: A 58) Procter & Gamble's Tide detergent does not attempt to get to know customers personally. Instead, Tide creates engagement and relationships through brand-building advertising, websites, and social media presence. Which of the following types of associations would be most profitable for the firm to develop with these customers? A) full partnerships B) basic relationships C) joint ventures D) strategic alliances E) business partnering Answer: B 59) Companies that practice marketing by ________ create offerings and messages that engage consumers rather than interrupt them. A) intrusion B) attraction C) competition D) forceful persuasion E) impersonal selling Answer: B 60) Which of the following is an example of consumer-generated marketing? A) Cristal, a jewelry store, uses its page on Facebook to provide information about its upcoming products to its customers. B) Figa, a leading provider of athletic shoes, helps its customers customize their shoes on its website and choose personalized settings. C) Fun & Run, a local amusement park, promotes its services by allowing consumers to upload videos and write reviews about the park. D) Barton's, a local pet supply store, rewards frequent buyers with vouchers and exclusive offers. E) Energix, a manufacturer of soft drinks, attracts customers through televised advertisements. Answer: C 61) For the past nine years, PepsiCo's Doritos brand has held a "Crash the Super Bowl" contest in which it invites 30-second ads from consumers and runs the best ones during the game. This is an example of ________. A) consumer-generated marketing B) frequency marketing C) customer-club marketing D) sustainable marketing E) multi-level marketing Answer: A 62) ________ refers to working closely with people inside and outside the company to jointly bring more value to customers. A) Demand management B) Customer-generated marketing C) Integrated communication D) Partner relationship management E) Channel value proposition Answer: D 63) ________ refers to a channel stretching from raw materials to components to final products that are carried to final buyers. A) A supply chain B) A marketing channel C) A market segment D) A demand chain E) A marketing-mix channel Answer: A 64) The final step in the marketing process is ________. A) capturing value from customers B) constructing an integrated marketing program C) building profitable relationships with the customers D) understanding the marketplace E) designing a customer-driven marketing strategy Answer: A 65) Stew Leonard's has created what has been the "Disneyland of Dairy Stores," complete with costumed characters, scheduled entertainment, and a petting zoo. It's built 30 additions onto the original store, which now serves more than 300,000 customers each week. This legion of loyal shoppers is largely a result of the store's passionate approach to customer service. Instead of focusing on individual transactions, Stew and his staff are putting a priority on ________. A) decreasing customer-perceived value B) managing partner relationships C) attracting "butterflies" D) converting "strangers" into "butterflies" E) capturing customer lifetime value Answer: E