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Marketing Management, 15e (Kotler)
Chapter 13 Setting Product Strategy
1) A ________ is anything that can be offered to a market to satisfy a want or need, including physical goods, services, experiences, events, persons, places, properties, organizations, information, and ideas.
A) function
B) product
C) benefit
D) process
E) structure
Answer: B
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
2) A customer judges a product offering by three basic elements: product features and quality, services mix and quality, and ________.
A) performance
B) utility
C) tangibility
D) price
E) availability
Answer: D
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
3) The five product levels constitute a ________. At each level more customer value is added.
A) product line
B) business model
C) customer value-hierarchy
D) value grid
E) demand chain
Answer: C
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
4) When companies search for new ways to satisfy customers and distinguish their offering from others, they look at the ________ product, which encompasses all the possible augmentations and transformations of the product.
A) consumption
B) expected
C) potential
D) augmented
E) basic
Answer: C
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
5) The way the user performs the tasks of getting and using products and related services is the user's total ________.
A) consumption system
B) consumable system
C) consistent use system
D) augmented system
E) potential system
Answer: A
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
6) Marketers must see themselves as benefit providers. For example, when a shopper purchases new shoes, he or she expects the shoes to cover his or her feet and allow him or her to walk unobstructed. This is an example of what level in the consumer-value hierarchy?
A) pure tangible good
B) basic product
C) augmented product
D) potential product
E) generic product
Answer: B
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Analytical thinking; Application of knowledge
7) How a consumer shops for organic foods and how he or she uses and disposes of the product is part of the consumers' ________ that is important for marketers to consider.
A) value proposition
B) consumption system
C) value system
D) quality perception
E) value chain
Answer: B
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Analytical thinking; Application of knowledge
8) The sellers of ________ goods carry a wide assortment to satisfy individual tastes. They must have well-trained salespeople to inform and advise customers.
A) unsought
B) specialty
C) convenience
D) heterogeneous shopping
E) generic
Answer: D
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
9) Marketers have traditionally classified products on the basis of three characteristics: ________, tangibility, and use.
A) availability
B) affordability
C) aesthetics
D) durability
E) necessity
Answer: D
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
10) Which of the following are tangible goods that normally survive many uses?
A) generic goods
B) durable goods
C) core benefits
D) convenience goods
E) unsought goods
Answer: B
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Analytical thinking
11) Because ________ are purchased frequently, marketers should make them available in many locations, charge only a small markup, and advertise heavily to induce trial and build preference.
A) nondurable goods
B) durable goods
C) services
D) unsought goods
E) specialty goods
Answer: A
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
12) What types of goods are purchased frequently, immediately, and with minimum effort by the consumers?
A) specialty goods
B) shopping goods
C) unsought goods
D) durable goods
E) convenience goods
Answer: E
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
13) It was sunny when Jenny went to class, but by the time class was over it was raining heavily, so Jenny stopped by the student store to buy an umbrella before she walked back to her dorm. In this case, the umbrella is an example of a(n) ________ good.
A) impulse
B) specialty
C) homogeneous shopping
D) emergency
E) heterogeneous shopping
Answer: D
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Analytical thinking; Application of knowledge
14) What goods are similar in quality but different enough in price to justify shopping comparisons?
A) emergency goods
B) homogeneous shopping goods
C) heterogeneous shopping goods
D) specialty goods
E) convenience goods
Answer: B
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
15) Products such as insurance, cemetery plots, and smoke detectors are examples of ________ goods that are products that the consumer does not know about or does not normally think of buying.
A) specialty
B) unsought
C) heterogeneous shopping
D) homogeneous shopping
E) convenience
Answer: B
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
16) Capital items are long-lasting goods that facilitate developing or managing the finished product. They include two groups: installations and ________.
A) natural products
B) component materials
C) operating supplies
D) equipment
E) processed materials
Answer: D
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
17) ________ are major purchases and are usually bought directly from the producer with the typical sale preceded by long negotiation periods.
A) Raw materials
B) Materials and parts
C) Processed materials
D) Capital goods
E) Installations
Answer: E
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
18) Marketing planning begins with formulating an offering to meet target customers' needs or wants.
Answer: TRUE
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
19) A product is anything that can be offered to a market to satisfy a want or need.
Answer: TRUE
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
20) In planning its market offering, the marketer needs to address five product levels, each of which reduces customer value.
Answer: FALSE
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
21) The customer-value hierarchy consists of the basic product, core benefit, expected product, augmented product, and the consumption system.
Answer: FALSE
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
22) Marketers have traditionally classified products on the basis of characteristics such as durability, tangibility, and use.
Answer: TRUE
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
23) Durable products normally require less personal selling and service and less seller guarantees than nondurable goods.
Answer: FALSE
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
24) Because they are intangible, durable goods normally require more quality control, supplier credibility, and adaptability than either services or nondurable goods.
Answer: FALSE
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
25) Carlos always buys bread and milk when he goes grocery shopping. In this case, bread and milk are examples of impulse goods.
Answer: FALSE
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Analytical thinking; Application of knowledge
26) A Maserati sports car is considered a convenience good because interested buyers will travel far to buy one.
Answer: FALSE
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Analytical thinking; Application of knowledge
27) The homogeneity of natural materials limits the amount of demand-creation activity that producers undertake.
Answer: TRUE
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
28) Capital items are long-lasting goods that facilitate developing or managing the finished products.
Answer: TRUE
Diff: 1
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
29) Supplies can be classified as two kinds: heterogeneous supplies and homogeneous supplies.
Answer: FALSE
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
30) In planning its market offering, the marketer must address the five product levels of the customer-value hierarchy. Describe the "customer-value hierarchy" and identify the five levels of product contained within.
Answer: Each layer adds more customer value. The five levels are:
1. the core benefit — the service or benefit the customer is really buying
2. the basic product — the actual product that provides the core benefit
3. expected product — a set of attributes and conditions buyers normally expect when they purchase the product
4. the augmented product — the marketer exceeds customer expectations
5. the potential product — which encompasses all the possible augmentations and transformations the product or offering might undergo in the future
These five elements constitute the buyers' consumption system.
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
31) The vast array of products that consumers buy can be classified on the basis of shopping habits and are broken down into four main areas. List these four main classifications of consumer goods and explain what elements are included within.
Answer: The four main areas are:
1. convenience goods are bought frequently, immediately, and with a minimum of effort
2. shopping goods are goods that the consumer characteristically compares on such bases as suitability, quality, price, and style
3. specialty goods have unique characteristics or brand identification for which a sufficient number of buyers are willing to make a special purchasing effort
4. unsought goods are those goods that the consumer does not know about or does not normally think of buying.
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
32) You know that marketers have traditionally classified products based on characteristics of durability, tangibility, and use. You also know that each product type has an appropriate marketing-mix strategy attached. In analyzing your company's products, you decide to list each of these products and the appropriate marketing-mix strategy to understand where your products "fit." List these products and their appropriate marketing-mix strategies.
Answer:
• Nondurable goods — the appropriate strategy is to make them available in many locations, charge only a small markup, and advertise heavily to induce trial and build preference.
• Durable goods — tangible goods that normally survive many uses. Durable products normally require more personal selling and service, command a higher margin, and require more seller guarantees.
• Services — intangible, inseparable, variable, and perishable products. They require more quality control, supplier credibility, and adaptability.
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Analytical thinking
33) Industrial goods can be classified in terms of how they enter the production process and their relative costliness. Identify the three groups of industrial goods.
Answer: The three groups of industrial goods include:
1. Materials and parts are goods that enter the manufacturer's product completely. Raw materials (farm and natural products) and manufactured materials and parts (component materials and component parts) compose this group.
2. Capital items are long-lasting goods that facilitate developing or managing the finished product, such as machinery (installations and equipment).
3. Supplies and business services are short-term goods and services that facilitate developing or managing the finished product; maintenance and repair and operating supplies are included here. Business supplies include advisory services and other "services" necessary for the ongoing operation of the business.
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
34) A manufacturer is contemplating introducing a product that is inferior to its competition in its performance, design, and functionality. However, the manufacturer believes that "good brand marketing" can overcome these shortfalls. Why is this thinking incorrect?
Answer: At the heart of a great brand is a great product, the product is a key element in the market offering. Customers will judge the product (offering) on three basic elements: product features and quality; services mix and quality, and price. Not having a competitive product cannot be overcome by marketing.
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Analytical thinking
35) Studying how consumers shop, how they use a particular product or service, and how they dispose of the product when consumed is important for marketers. This information forms the basis of product strategy. Define the consumption system and identify the two upcoming product strategies that are affected by this knowledge.
Answer: This is called the user's total consumption system, defined as the way the user performs the tasks of getting and using products and related services. This is important because it will contain information useful in the product-augmentation strategy and the potential product strategy.
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
36) Industrial-goods classifications based on terms of how the products enter the production process and their relative costs include such segments as materials and parts and capital items. Window cleaning services, consumable office supplies, personal computers, desks, paint, nails, and buckets are included in the classifications of industrial goods. List the other "classifications" including subclassifications for industrial goods.
Answer: Industrial-goods classifications include material and parts, farm products, natural products, manufactured materials and parts, and component parts. Capital goods include installations and equipment. Supplies and business services include maintenance and repair items, operating supplies, and business advisory services.
Diff: 2
LO: 13.1: What are the characteristics of products, and how do marketers classify products?
AACSB: Reflective thinking
37) Most products are established at one of four performance levels: low, average, high, or superior. For example, mountain bikes come in a variety of sizes and physical attributes. When a consumer purchases a mountain bike costing $1,000, he or she expects the bike to perform to specifications and to have a high ________, meeting the promised specifications.
A) features
B) conformance quality
C) durability
D) performance quality
E) reliability
Answer: D
Diff: 3
LO: 13.2: How can companies differentiate products?
AACSB: Analytical thinking; Application of knowledge
38) Many products can be differentiated in terms of their ________, which is its size, shape, or physical structure.
A) form
B) prototype
C) architecture
D) model
E) blueprint
Answer: A
Diff: 1
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
39) ________ is the ability of a company to prepare on a large-scale basis individually designed products, services, programs, and communications.
A) Mass customization
B) Reverse engineering
C) Interoperability
D) Backward compatibility
E) Benchmarking
Answer: A
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
40) Buyers expect products to have high ________, which is the degree to which all produced units are identical and meet promised specifications.
A) durability
B) compatibility
C) conformance quality
D) form
E) performance quality
Answer: C
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
41) If the Ford GT is designed to accelerate to 50 miles per hour within 10 seconds, and every Ford GT coming off the assembly line does this, the model is said to have high ________.
A) reliability
B) conformance quality
C) durability
D) compatibility
E) interoperability
Answer: B
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Analytical thinking; Application of knowledge
42) ________ describes the product's look and feel to the buyer; it has an advantage of creating distinctiveness that is difficult to copy.
A) Design
B) Style
C) Durability
D) Conformance
E) Reliability
Answer: B
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
43) Ideal ________ would exist if users could fix the product themselves with little cost in money or time.
A) durability
B) reliability
C) style
D) design
E) reparability
Answer: E
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
44) For ________ to be valued for products like vehicles and kitchen appliances, it should not be associated with an excessive price premium and the product must not be subject to rapid technological obsolescence.
A) conformance quality
B) performance quality
C) reparability
D) durability
E) style
Answer: D
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
45) When the physical product cannot be easily differentiated, the key to competitive success may lie in adding valued services and improving their quality. The main service differentiators are ordering ease, delivery, installation, ________, customer consulting, maintenance, and repair.
A) technology intensity
B) responsiveness
C) ease of use
D) customer training
E) adaptability
Answer: D
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
46) Delivery refers to how well a product or service is brought to the customer. It includes speed, ________, and care throughout the delivery process.
A) expedience
B) intensity
C) tangibility
D) performance
E) accuracy
Answer: E
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
47) ________ refers to data, information systems, and advice services that the seller offers to their buyers.
A) Sales force relationships
B) Customer relationships
C) Open source technology
D) Customer training
E) Customer consulting
Answer: E
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
48) Differentiating on ________ is important for companies with complex products and becomes an especially good selling point when targeting technology novices.
A) delivery
B) ordering ease
C) ease of installation
D) customer consulting
E) reparability
Answer: C
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
49) ________ describes the service program for helping customers keep purchased products in good working order.
A) Returns
B) Ordering ease
C) Installation
D) Maintenance and repair
E) Delivery
Answer: D
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
50) Which of the following actions would result in the elimination of uncontrollable returns of products in the short run?
A) improved handling
B) better packaging
C) improved transportation
D) proper storage
E) cannot be eliminated
Answer: E
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
51) Smith & Adams Poultry has recently upgraded its transactional model such that its customers (restaurants and hotels) can communicate with its central supply system to indicate purchase volumes, dates, and receive confirmation, through their computer terminals. This is an example of a company differentiating itself versus competition in terms of ________.
A) customer relationships
B) customer training
C) installation
D) delivery ease
E) ordering ease
Answer: E
Diff: 3
LO: 13.2: How can companies differentiate products?
AACSB: Analytical thinking; Application of knowledge
52) To be branded, physical products need not be differentiated.
Answer: FALSE
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
53) To avoid "feature fatigue," companies must be careful to prioritize those features that are included and find unobtrusive ways to provide information about how consumers can use and benefit from the feature.
Answer: TRUE
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
54) Firms should design the highest performance level possible for their products.
Answer: FALSE
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
55) As a selling point, durability commands a particularly high pricing premium, especially for products that are subject to rapid technological obsolescence, as are personal computers and video cameras.
Answer: FALSE
Diff: 3
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
56) If the physical product cannot be easily differentiated, the key to competitive advantage lies in the pricing of the related "services" provided by the manufacturer.
Answer: FALSE
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
57) Customer training and customer consulting are two areas for service differentiation that manufacturers can use with their products.
Answer: TRUE
Diff: 1
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
58) The cost of processing a return can be significantly greater than that of an outbound shipment.
Answer: TRUE
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
59) The ability to design custom jeans through Levi's and create merchandise with your own images through Zazzle are examples of mass customization.
Answer: TRUE
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Application of knowledge
60) Describe the six main service differentiators.
Answer: The main service differentiators are ordering ease, delivery, installation, customer training, customer consulting, and maintenance and repair.
1. Ordering ease refers to how easy it is for the customer to place an order with the company.
2. Delivery refers to how well the product or service is brought to the customer. It includes speed, accuracy, and care throughout the process.
3. Installation refers to the work done to make a product operational in its planned location. Ease of installation is a true selling point for buyers of complex products like heavy equipment and for technology novices.
4. Customer training helps the customer's employees use the vendor's equipment properly and efficiently.
5. Customer consulting includes data, information systems, and advice services the seller offers to buyers.
6. Maintenance and repair programs help customers keep purchased products in good working order.
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
61) Distinguish between controllable returns and uncontrollable returns.
Answer: Controllable returns result from problems or errors by the seller or customer and can mostly be eliminated with improved handling or storage, better packaging, and improved transportation and forward logistics by the seller or its supply chain partners.
Uncontrollable returns result from the need for customers to actually see, try, or experience
products in person to determine suitability and can't be eliminated by the company in the
short run through any of these means.
Diff: 2
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
62) To be branded, products must be differentiated. List the possible ways that physical products can be differentiated.
Answer: Products can be differentiated according to form, features, customization, performance quality, conformance quality, durability, reliability, reparability, and style.
Diff: 1
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
63) In your position as a marketing manager for a small industrial company, you have been asked by the president to help differentiate the company's product from its competitors. In reviewing your marketing management notes, you note that the text stated that physical products could be differentiated in nine ways. These nine areas comprise the "meat" of the memo you are writing to the president of your firm. What are the nine ways that physical products can be differentiated?
Answer: The nine ways that physical products can be differentiated are form, features, customization, performance quality, conformance quality, durability, reliability, reparability, and style.
Diff: 1
LO: 13.2: How can companies differentiate products?
AACSB: Analytical thinking
64) When a physical product cannot easily be differentiated, the key to competitive success may lie in adding valued services and improving quality. Identify the six main service differentiators.
Answer: The six main service differentiators are ordering ease, delivery, installation, customer training, customer consulting, and maintenance and repair.
Diff: 1
LO: 13.2: How can companies differentiate products?
AACSB: Reflective thinking
65) Realizing that although household products is a huge category — taking up an entire supermarket aisle or more — it is an incredibly boring one, the founders of Method Products designed a sleek, uncluttered dish soap container that also carried functional advantages, such as ease of dispensing soap and cleaning. Method is competing in the crowded market for household products on the basis of superior ________.
A) design
B) durability
C) conformance
D) reliability
E) performance quality
Answer: A
Diff: 3
LO: 13.3: Why is product design important, and what are the different approaches taken?
AACSB: Analytical thinking; Application of knowledge
66) In increasingly fast-paced markets, price and technology are not enough. ________ is the factor that will often give a company its competitive edge and is defined as the totality of features that affect how a product looks, feels, and functions in terms of customer requirements.
A) Conformance
B) Design
C) Performance
D) Reliability
E) Style
Answer: B
Diff: 2
LO: 13.3: Why is product design important, and what are the different approaches taken?
AACSB: Reflective thinking
67) Design can shift consumer perceptions to make brand experiences more rewarding.
Answer: TRUE
Diff: 1
LO: 13.3: Why is product design important, and what are the different approaches taken?
AACSB: Reflective thinking
68) Apple has a clear design philosophy it calls "Design 3.0" and an internal design slogan, "Make it Meaningful," that reflects its relentless focus on making beautiful and intuitive products that will be integrated into customers' lifestyles.
Answer: FALSE
Diff: 3
LO: 13.3: Why is product design important, and what are the different approaches taken?
AACSB: Application of knowledge
69) Design thinking requires intensive ethnographic studies of consumers, creative brainstorming sessions, and collaborative teamwork to decide how to bring the design idea to reality.
Answer: TRUE
Diff: 2
LO: 13.3: Why is product design important, and what are the different approaches taken?
AACSB: Reflective thinking
70) What is the significance of design for a company's products and services? What are the advantages of a good design?
Answer: Design offers a potent way to differentiate and position a company's products and services. Design is the totality of features that affect how a product looks, feels, and functions to a consumer. Design offers functional and aesthetic benefits and appeals to both our rational and emotional sides. The designer must figure out how much to invest in form, feature development, performance, conformance, durability, reliability, reparability, and style. To the company, a well-designed product is easy to manufacture and distribute. To the customer, a well-designed product is pleasant to look at and easy to open, install, use, repair, and dispose of. The designer must take all these factors into account. Design can shift consumer perceptions to make brand experiences more rewarding. Design should penetrate all aspects of the marketing program so that all design aspects work together.
Diff: 2
LO: 13.3: Why is product design important, and what are the different approaches taken?
AACSB: Reflective thinking
71) The common denominators of luxury brands are quality and ________.
A) uniqueness
B) practicality
C) global appeal
D) contemporary
E) goodwill
Answer: A
Diff: 2
LO: 13.4: How can marketers best manage luxury brands?
AACSB: Reflective thinking
72) A winning formula for many ________ brands is craftsmanship, heritage, authenticity, and history, often critical to justifying a sometimes extravagant price.
A) design
B) nondurable
C) durable
D) ingredient
E) luxury
Answer: E
Diff: 1
LO: 13.4: How can marketers best manage luxury brands?
AACSB: Reflective thinking
73) The brand promise for ________ is "the product you buy is of highest esteem, based on its timeliness, elegant design and the high quality, which is derived from the excellence of our craftsmen."
A) Hermés
B) Montblanc
C) Patrón
D) Sub-zero Refrigerators
E) Armani
Answer: B
Diff: 3
LO: 13.4: How can marketers best manage luxury brands?
AACSB: Application of knowledge
74) ________ has overtaken the United States as the world's largest luxury market; it's forecast that one-third of all high-end goods will be sold there in the coming years.
A) China
B) India
C) South Africa
D) Brazil
E) South Korea
Answer: A
Diff: 2
LO: 13.4: How can marketers best manage luxury brands?
AACSB: Reflective thinking
75) Which of the following is NOT one of the guidelines for managing luxury brands?
A) Besides brand names, other brand elements — logos, symbols, packaging, signage — can be important drivers of brand equity for luxury products.
B) Secondary associations from linked personalities, events, countries, and other entities should be avoided.
C) Luxury brands must employ a premium pricing strategy, with strong quality cues and few discounts and markdowns.
D) All aspects of the marketing program for luxury brands must be aligned to ensure high-quality products and services and pleasurable purchase and consumption experiences.
E) Luxury brands must carefully control distribution via a selective channel strategy.
Answer: B
Diff: 3
LO: 13.4: How can marketers best manage luxury brands?
AACSB: Reflective thinking
76) Competition for luxury brands must be defined narrowly.
Answer: FALSE
Diff: 2
LO: 13.4: How can marketers best manage luxury brands?
AACSB: Reflective thinking
77) In the aftermath of a crippling recession, luxury for many has become more about style and substance, combining personal pleasure and self-expression.
Answer: TRUE
Diff: 2
LO: 13.4: How can marketers best manage luxury brands?
AACSB: Reflective thinking
78) What are the key guidelines for managing luxury brands?
Answer:
• Maintaining a premium image for luxury brands is crucial; controlling that image is thus a priority.
• Luxury branding typically includes the creation of many intangible brand associations and an aspirational image.
• All aspects of the marketing program for luxury brands must be aligned to ensure high-quality products and services and pleasurable purchase and consumption experiences.
• Besides brand names, other brand elements — logos, symbols, packaging, signage — can be important drivers of brand equity for luxury products.
• Secondary associations from linked personalities, events, countries, and other entities can boost luxury-brand equity as well.
• Luxury brands must carefully control distribution via a selective channel strategy.
• Luxury brands must employ a premium pricing strategy, with strong quality cues and few discounts and markdowns.
• Brand architecture for luxury brands must be managed carefully.
• Competition for luxury brands must be defined broadly because it often comes from other categories.
• Luxury brands must legally protect all trademarks and aggressively combat counterfeits.
Diff: 2
LO: 13.4: How can marketers best manage luxury brands?
AACSB: Reflective thinking
79) Which company launched Eco-Fina packaging for its water?
A) PepsiCo
B) Coca-Cola
C) SodaStream
D) PURE
E) Sigg Switzerland
Answer: A
Diff: 2
LO: 13.5: What environmental issues must marketers consider in their product strategies?
AACSB: Application of knowledge
80) ________ found a highly creative way to address the problem of proliferating plastic bottles with its "Waste ................
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