Marketing Management 3e Marshall Chapter 3 Solution Quiz Answers
Marketing Management, 3e (Marshall) Chapter 1 Marketing in Today's Business Milieu
1) A commonly held misconception about marketing is that it is all about advertising and selling.
Answer: TRUE Explanation: A commonly held misconception about marketing is that it is all about advertising and selling. Several important factors have contributed to the development of these misconceptions: marketing's inherent visibility and its tendency toward buzzwords and "spin." Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-01 Identify typical misconceptions about marketing, why they persist, and the resulting challenges for marketing management. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
2) Marketing is relevant only to people in the organization who work directly in the marketing department.
Answer: FALSE Explanation: Marketing's stakeholders include any person or entity inside or outside a firm with whom marketing interacts, impacts, and is impacted by. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-01 Identify typical misconceptions about marketing, why they persist, and the resulting challenges for marketing management. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
3) The American Marketing Association defines marketing as "the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large."
Answer: TRUE Explanation: The American Marketing Association offers the following as its official definition of marketing: Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation 1 Copyright 2019 © McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior
4) Peter Drucker stated that since it is the customer who defines value, the business enterprise has only two business functions: marketing and innovation.
Answer: TRUE Explanation: According to Peter Drucker, what the business thinks it produces is not of first importance—especially not to the future of the business and its success. What the customer thinks he is buying, what he considers "value" is decisive. Because it is the purpose of a business to create a customer, the business enterprise has two—and only two—business functions: marketing and innovation. Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
5) Sustainability refers to business practices that meet humanity's needs without harming future generations.
Answer: TRUE Explanation: The concept of environmentally friendly marketing, or green marketing, has been a growing trend in socially responsible companies. Today the movement has evolved into a part of the philosophical and strategic core of many firms under the label sustainability, which refers to business practices that meet humanity's needs without harming future generations. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Understand AACSB: Ethics Accessibility: Keyboard Navigation
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8) Don Peppers and Martha Rogers popularized the term one-to-one marketing. Some firms come close to one-to-one marketing by combining flexible manufacturing with flexible marketing to enhance customer choices.
Answer: TRUE Explanation: Don Peppers and Martha Rogers popularized the term one-to-one marketing, which advocates that firms should direct energy and resources into establishing a learning relationship with each customer and then connect that knowledge with the firm's production and service capabilities to fulfill that customer's needs in as custom a manner as possible. Some firms come close to one-to-one marketing by employing mass customization, in which they combine flexible manufacturing with flexible marketing to greatly enhance customer choices. Difficulty: 2 Medium Topic: The Evolution of Marketing Learning Objective: 01-03 Appreciate how marketing has evolved from its early roots to be practiced as it is today. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
9) Fred Wiersema's book The New Market Leaders states that marketers will continue to have more power than customers in both B2B and B2C markets.
Answer: FALSE Explanation: Fred Wiersema, in his book The New Market Leaders, builds a powerful case that the balance of power is shifting between marketers and their customers, both in business-to- consumer (B2C/end user) markets and business-to-business (B2B) markets. Wiersema's central point is that not only is a customer orientation desirable, but also in today's market it is a necessity for survival. Difficulty: 1 Easy Topic: Marketing Trends Learning Objective: 01-04 Recognize the impact of key change drivers on the future of marketing. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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10) In the current business environment, firms have learned to be open about products and services with consumers who have endless sources of information, including blogs, chat rooms, and independent websites.
Answer: TRUE Explanation: For competitive reasons, firms have no choice but to be more open about their businesses and products. Even if they wanted to, firms can't stop chat rooms, independent websites, web logs or blogs, and other customer-generated modes of communication from filling web page after web page with information, disinformation, and opinions about a company's products, services, and even company dirty laundry. Difficulty: 2 Medium Topic: Marketing Trends Learning Objective: 01-04 Recognize the impact of key change drivers on the future of marketing. Bloom's: Understand AACSB: Technology Accessibility: Keyboard Navigation
11) Customer orientation, a component of market orientation, places the customer at the core of all aspects of the enterprise.
Answer: TRUE Explanation: Think of market orientation as the implementation of the marketing concept. The notion of market orientation, one component of which is customer orientation—placing the customer at the core of all aspects of the enterprise—takes the guiding business philosophy of the marketing concept and works to more usefully define just how to implement it within a firm. Difficulty: 2 Medium Topic: Marketing Trends Learning Objective: 01-03 Appreciate how marketing has evolved from its early roots to be practiced as it is today. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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14) In contrast to Marketing (Big M), marketing (little m) serves the firm and its stakeholders at a functional or operational level.
Answer: TRUE Explanation: In contrast to Marketing (Big M), marketing (little m) serves the firm and its stakeholders at a functional or operational level; hence, marketing (little m) is often thought of as tactical marketing. Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-04 Recognize the impact of key change drivers on the future of marketing. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
15) Marketing (Big M) refers to the strategic, long-term, firm-level commitment to investing in marketing.
Answer: TRUE Explanation: Marketing (Big M) serves as a core driver of business strategy. This approach is often referred to as strategic marketing, which means a long-term, firm-level commitment to investing in marketing—supported at the highest organization level—for the purpose of enhancing organizational performance. Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-04 Recognize the impact of key change drivers on the future of marketing. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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16) For successful Marketing (Big M), firms need to align all internal organizational processes and systems around the customer.
Answer: TRUE Explanation: For successful Marketing (Big M), firms today need to align all internal organizational processes and systems around the customer. They cannot let the IT system, telecommunications system, billing system, or any other internal process or system become an impediment to a customer orientation. If the people inside a firm understand the power of a customer-centric business approach, but the internal systems don't support it, Marketing (Big M) won't be successful. Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-04 Recognize the impact of key change drivers on the future of marketing. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
17) Strategic marketing refers to the idea that firms should direct energy and resources into establishing a learning relationship with each customer and connect the learned knowledge with the firm's production and service capabilities.
Answer: FALSE Explanation: Marketing (Big M) serves as a core driver of business strategy. That is, an understanding of markets, competitors, and other external forces, coupled with attention to internal capabilities, allows a firm to successfully develop strategies for the future. This approach is often referred to as strategic marketing, which means a long-term, firm-level commitment to investing in marketing—supported at the highest organization level—for the purpose of enhancing organizational performance. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-04 Recognize the impact of key change drivers on the future of marketing. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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21) Marketing often doesn't get the "respect" it deserves as a professional field of study, primarily because A) compared to other business functions, it has had few useful metrics to measure its performance impact. B) people generally don't understand what marketing is or what it does. C) marketing is all about the emotion and less about facts. D) marketing positions tend to pay less than other business functions. E) it fails to impact the bottom line of the company and isn't factored into executive decisions.
Answer: A Explanation: Despite the fact that much of marketing is easily observable to just about anyone, marketing as a professional field worthy of serious study doesn't always get the respect it deserves, maybe in part because of its overexposure, but also because in the past, marketing has had few useful metrics or measures to gauge the performance impact of a firm's marketing investment, while other areas of the firm have historically been much more driven by measurement of results. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-01 Identify typical misconceptions about marketing, why they persist, and the resulting challenges for marketing management. Bloom's: Understand AACSB: Communication Accessibility: Keyboard Navigation
22) Which of the following statements is TRUE of marketing? A) Unlike most other key areas of business, marketing as a field is not visible by nature. B) Marketing departments "own" an organization's marketing initiative. C) Most aspects of marketing take place behind the curtain of an organization, out of the public's sight. D) Marketing is all about advertising and selling. E) Marketing is no more inherently unethical than other business areas.
Answer: E Explanation: Marketing is no more inherently unethical than other business areas. The accounting scandals at Enron, WorldCom, and other firms in the early 2000s show that to be true. However, when some element of marketing proves to be unethical (or even illegal), it tends to be visible to the general public. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-01 Identify typical misconceptions about marketing, why they persist, and the resulting challenges for marketing management. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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23) Which of the following areas of business is highly public and readily visible outside the confines of the internal business operation? A) marketing B) finance C) manufacturing D) operations management E) human resource management
Answer: A Explanation: Unlike most other key areas of business, marketing as a field is highly public and readily visible outside the confines of the internal business operation. Most aspects of financial management, accounting, information technology, production, operations management, and human resource management take place behind the curtain of an organization, out of the general public's sight. But marketing is very different. A good portion of marketing is very public. Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-01 Identify typical misconceptions about marketing, why they persist, and the resulting challenges for marketing management. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
24) A misconception about marketing is that it is ____. A) relevant to everyone B) no more inherently unethical than other business areas C) all about selling D) highly visible by nature E) highly public
Answer: C Explanation: A misconception about marketing is that it is all about selling. The general public also experiences a lot of selling. Much of this day-to-day selling is in retail store environments. Selling, or more correctly "personal selling," is simply another method of marketing communication. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-01 Identify typical misconceptions about marketing, why they persist, and the resulting challenges for marketing management. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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27) Peter Drucker, the father of modern management, believed that marketing ____. A) should be a separate function within the business B) is the business as seen from an internal point of view C) is the whole business as seen from the customer's point of view D) is not the central dimension of the entire business E) should be considered just as a "department" in an organization
Answer: C Explanation: According to Peter Drucker, marketing is so basic that it cannot be considered a separate function within the business. It is a central dimension of the entire business. It is the whole business seen from the customer's point of view. Concern and responsibility for marketing must permeate all areas of the enterprise. Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
28) ____ is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. A) Accounting B) Marketing C) Manufacturing D) Finance E) Economics
Answer: B Explanation: The American Marketing Association's definition of marketing is "the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large." Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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29) Purpose marketing, or pro-social marketing, as practiced by the well-known Tom's shoe company, ____. A) is a least preferred marketing strategy B) is a for-profit part of the business C) focuses primarily on increasing productivity D) engages consumers in a meaningful way E) has no impact on consumers who care about social issues
Answer: D Explanation: Purpose marketing, or pro-social marketing, is growing as a marketing strategy. This growing popularity can be attributed to an increasing number of consumers who say what a company stands for influences their purchasing decisions. Toms shoe company is renowned for its social entrepreneurism and socially conscious purpose marketing. Toms' "One for One" mission assures customers that with every purchase, "Toms will help a person in need." Difficulty: 2 Medium Topic: Socially Responsible Marketing Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
30) From a customer's perspective, what is defined as a ratio of the bundle of benefits a customer receives from an offering, compared to the costs incurred by the customer in acquiring that bundle of benefits? A) Exchange B) Strategy C) Sustainability D) Value E) Power
Answer: D Explanation: From a customer's perspective, we define value as a ratio of the bundle of benefits a customer receives from an offering compared to the costs incurred by the customer in acquiring that bundle of benefits. Difficulty: 1 Easy Topic: The Concept of Customer Value Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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33) The AMA's definition of marketing reflects the view toward marketing activities as focused on ____. A) producing innovative products B) increasing productivity C) maintaining relationships with suppliers D) creating and delivering offerings that have value E) advertising and selling
Answer: D Explanation: The AMA defines marketing as the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. Difficulty: 1 Easy Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
34) After a recent 140-day strike, the union members in California went back to work at area grocery stores. The union negotiated raises, better health care benefits, and a one-tier pay scale. The union may best be described as a(n) ____. A) governmental body B) stakeholder C) vendor D) internal customer E) management group
Answer: B Explanation: The range of external stakeholders—those outside a firm—includes customers, vendors, governmental bodies, labor unions, and many others. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Apply AACSB: Knowledge Application Accessibility: Keyboard Navigation
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35) Companies that promote sustainability practices like Starbucks, which has a stringent recycling program, or General Electric, which makes environmentally sensitive products, are practicing ____ marketing. A) green B) predictive C) affiliate D) shotgun E) one-to-one
Answer: A Explanation: The concept of environmentally friendly marketing, or green marketing, has been a growing trend in socially responsible companies. Environmental awareness coupled with a sense of social responsibility is leading many companies to assess their environmental policies and business practices. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
36) Bryan gets reduced fees for his daughter's piano lessons by maintaining her teacher's website. Bryan is practicing the central tenet of marketing called ____. A) value B) exchange C) growth D) sustainability E) power
Answer: B Explanation: A central tenet of marketing is the concept of exchange, in which people give up something of value to them for something else they desire to have. Usually an exchange is facilitated by money, but not always. Sometimes people trade or barter nonmonetary resources such as time, skill, expertise, intellectual capital, and other things of value for something else they want. Difficulty: 2 Medium Topic: Marketing and Marketing Management Defined Learning Objective: 01-02 Define what marketing and marketing management really are and how they contribute to a firm's success. Bloom's: Apply AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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39) The stereotypical automobile dealership uses tactics like high pressure and bargaining to get customers to buy. This is an example of the ____ orientation. A) production B) sales C) marketing D) customer E) relationship
Answer: B Explanation: A sales orientation suggests that, to increase sales and consequently production capacity utilization, professional salespeople need to "push" product into the hands of customers, both businesses and end users. Difficulty: 2 Medium Topic: The Evolution of Marketing Learning Objective: 01-03 Appreciate how marketing has evolved from its early roots to be practiced as it is today. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
40) Which of the following is a reason why production capacity utilization began to decline around the end of World War I? A) Firms that had dominated their respective industries before the war maintained their positions due to lack of competition. B) High entry barriers prevented new companies from entering into the market place. C) Financial markets placed more pressure on firms to continually increase sales volume and profits. D) Financial markets were becoming less sophisticated. E) Capacity had been decreased greatly for the war.
Answer: C Explanation: Around the end of World War I, production capacity utilization began to decline for several reasons. First, capacity had been increased greatly for the war. Second, a number of firms that had dominated their respective industries before the war now found themselves with stiff competition for sales because many new competitors had flooded into the marketplace. And third, financial markets were becoming more sophisticated and were placing more pressure on firms to continually increase sales volume and profits. Difficulty: 2 Medium Topic: The Evolution of Marketing Learning Objective: 01-03 Appreciate how marketing has evolved from its early roots to be practiced as it is today. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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41) Companies that conduct a great deal of research to learn how they can successfully put the marketing concept into practice most likely have a ____ orientation. A) production B) selling C) marketing D) research E) differentiation
Answer: C Explanation: A great deal of research has been devoted to learning how a firm can successfully put the marketing concept into practice. Think of market orientation as the implementation of the marketing concept. Difficulty: 2 Medium Topic: The Evolution of Marketing Learning Objective: 01-03 Appreciate how marketing has evolved from its early roots to be practiced as it is today. Bloom's: Understand AACSB: Analytical Thinking Accessibility: Keyboard Navigation
42) The marketing concept was introduced ____. A) after the Civil War B) after World War I C) during the Great Depression D) in the 1980s E) in the 1950s
Answer: E Explanation: In the 1950s, increased demand for consumer goods and services, a new focus on family and the need for normalcy, increased production capacity, and the advent of mainframe computers—combined with growing frustration with high-pressure selling—sparked a shift in the focus of American business. The resulting business philosophy has been labeled the marketing concept, which is an organization-wide customer orientation with the objective of achieving long-run profits. Difficulty: 1 Easy Topic: The Evolution of Marketing Learning Objective: 01-03 Appreciate how marketing has evolved from its early roots to be practiced as it is today. Bloom's: Remember AACSB: Analytical Thinking Accessibility: Keyboard Navigation
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Marketing Management 3e Marshall Chapter 3 Solution Quiz Answers
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