Ch01 MKTG TB 2ce

Chapter 1An Overview of Marketing
MULTIPLE CHOICE 1. What does the term marketing refer to? a. new product concepts and improvements b. selling c. advertising and promotion activities d. a philosophy that stresses customer satisfaction ANS: !"S: 1 #$%: & "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy '(): *1+1 (0/: #emember
1. A business is concerned with many day+to+day activities. Some of the most important of these
activities are the planning and development of a product2 its pricing policy2 and the distribution strategy. What are all these activities part of? a. a control system b. marketing c. accounting d. production
ANS: (
"his description contains three of the four main activities included in the marketing function. 3/any students may mistakenly believe that marketing is concerned only with promotion.4
!"S: 1 #$%: & '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel !ricing- "(.$ /odel !roduct- "(.$ /odel istribution (0/: 5igher 'rder &. Which of the following is a philosophy2 an attitude2 a perspective2 or a management
orientation that stresses customer satisfaction? a. planning strategy b. customer management c. marketing d. reciprocity
ANS: , !"S: 1 #$%: & "'!: AA,S( #eflective "hinking- "(.$ /odel !roduct 6. Which of the following best characteri7es marketing? a. promotional activities. b. personal selling. c. advertising. d. customer satisfaction. ANS: !"S: 1 #$%: & "'!: AA,S( #eflective "hinking- "(.$ /odel !roduct '(): *1+1 (0/: #emember '(): *1+1 (0/: #emember
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,hapter 1 9 An 'verview of /arketing :. Which of the following is a key ingredient in the philosophy of marketing that occurs when
people give up something in order to receive something that they would rather have? a. e;change b. synergy c. leverage d. reciprocity
ANS: A !"S: 1 #$%: &+6 "'!: AA,S( #eflective "hinking- "(.$ /odel !roduct '(): *1+1 (0/: #emember
<. What must happen in order for e;change to occur? a. 'rgani7ed marketing activities must also take place. b. A profit+oriented organi7ation must be involved in the process. c. /oney or other legal tender is re=uired. d. $ach party must have something the other party considers to be valuable. ANS:
$;change involves the trade of items of value2 but does not necessarily involve formal organi7ations2 profit2 or money>legal tender.
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?. A problem facing the timber industry is the absence of any effective way to prove that
rainforest timber was legally harvested. @n places like @ndonesia2 as much as A* percent of timber available for sale was illegally cut. ,ompanies such as "he 5ome epot do not want to sell timber from illegally logged forests even though the demand is great for timber from rainforests. Which of the following conditions re=uired for an e;change to occur is missing when a company tries to sell illegally ac=uired logs to "he 5ome epot? a. "here are more than two parties involved. b. $ach party has something of value to bring to the e;change. c. 'ne party is free to accept the e;change offer. d. $ach party believes it is appropriate to deal with the other party.
ANS:
%or an e;change to occur2 two or more parties must be involved. (oth parties are free to accept or reBect the e;change. @f "he 5ome epot believes the timber was illegally obtained2 then it will not want to deal with the loggers.
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,hapter 1 9 An 'verview of /arketing A. Why is the concept of e;change important to marketing? a. /oney is the only medium of e;change for business marketers. b. $;change provides money to marketers. c. /arketing activities help to create e;change. d. /arketing activities are a re=uirement for e;change to take place. ANS: ,
/arketing activities help the e;change to take place2 but marketing can occur without an e;change.
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ominoDs !i77a is offering racing fans a chance to earn points toward NAS,A#+branded merchandise via the NAS,A# #ace!oints loyalty program. ,onsumers who buy E1* worth of ominoDs !i77a will receive 1** NAS,A# #ace!oints. NAS,A# #ace!oints will be credited to membersD accounts. #acing fans can collect points to earn NAS,A# merchandise2 including apparel and hats or one+of+a+kind e;periences2 such as driving a real race car. What will occur when a NAS,A# fan trades in his or her points for a mug autographed by a favourite driver? a. synergy b. sublimation c. e;change d. reciprocity
ANS: ,
%or an e;change to occur2 two or more parties must be involved. (oth parties are free to accept or reBect the e;change. %urthermore2 each party must have something that is of value to the other party. @n this case2 the value for ominoDs is customer loyalty.
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1*. What must occur for an e;change to take place? a. "here must be at least two parties involved. b. /oney must be used in the transaction. c. $ach party must feel obligated to accept the offer. d. At least one party must have something of value that the other party desires. ANS: A !"S: 1 #$%: 6 "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+1 (0/: #emember
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,hapter 1 9 An 'verview of /arketing 11. %or many years2 !rocter . Famble 3!.F4 viewed its @vory soap as Bust plain old soapGand
not as a cleansing product that could provide other benefits as well. When it came to @vory soap2 !.F focused on how well it made the soap and not on what customers wanted from a bar of soap. What type of orientation did the company have? a. sales b. production c. market d. customer
ANS: (
"he production orientation forces a company to build whatever it builds bestH that is2 whatever it has the e;perience and e;pertise in doing.
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11. Andi 0ittleton has inherited a %eatherlite brand horse trailer from her recently deceased
grandfather. A preliminary investigation has shown many people would be interested in owning a %eatherlite brand horse trailer. She is considering placing an advertisement in a newspaper targeted to horse owners. She has been told similar horse trailers are selling for about E162***. Which of the following conditions is necessary for an e;change to occur between 0ittleton and a buyer? a. 5er trailer should carry a low price. b. "he trailer should be on display somewhere that people will see it. c. She needs to practise negotiating. d. 0ittleton and her buyer must be able to walk away from the deal if desired.
ANS:
%or an e;change to take place2 each party must have something the other valuesH the parties must be able to communicateH each party must believe that it is appropriate to deal with the otherH and each party must be free to accept or reBect the e;change offer.
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,hapter 1 9 An 'verview of /arketing 1&. "o increase interest in rodeos2 the local chapter of the National #odeo ,owboys Association
3N#,A4 is offering free roping lessons to students in grades < and ?. Which of the following best describes an e;change? a. Students and their parents can decide for themselves if the lessons have any value. b. "he students want to take the lessons but are unaware that they are being offered for free. c. "he parents of the students are unsure whether the N#,A is a legitimate organi7ation. d. (oth the N#,A and the students taking the lessons will trade something of value.
ANS:
@f the course has no value2 then an e;change cannot occur. Without communication2 the e;change of knowledge for time and energy cannot occur. @n an e;change2 each participant has something of value to the other. %or an e;change to occur2 each party must believe it is desirable.
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16. Which of the following is a marketing management philosophy? a. sales promotion orientation b. societal change orientation c. market orientation d. profitability orientation ANS: , !"S: 1 #$%: 6+: "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy '(): *1+1 (0/: #emember
1:. @ndonesian logging companies harvest rainforests for timber and assume that a market e;ists
for their products. Which type of orientation does the typical @ndonesian logging company have? a. e;change b. environmental c. production d. sales
ANS: ,
"he logging companies do not focus on the needs and desires of the marketplace.
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,hapter 1 9 An 'verview of /arketing 1<. What type of orientation do firms have when they focus on the internal capabilities of the
firm2 rather than on the desires and needs of the marketplace? a. sales b. production c. market d. customer
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1?. What type of orientation does a company have when it sets its goals and strategies based on
what its current e=uipment can produce2 what products engineering can design2 and what the company itself can do best? a. marketplace b. sales c. production d. e;change
ANS: , !"S: 1 #$%: 6+: '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy- "(.$ /odel !roduct (0/: #emember 1A. #esearchers at !!F @ndustries spent considerable time2 effort2 and money developing a bluish
windshield that would let in filtered sunlight but block out the heat. 0ittle market research was done2 but the scientists were convinced this new product would be significantly better than e;isting windshields2 even though it was more e;pensive and of a different colour than the current models on the market. "his scenario suggests !!F most likely has which type of orientation? a. e;change b. production c. sales d. customer
ANS: (
"he =uestions researchers apparently asked before developing their windshield were2 IWhat can we do best?J and IWhat can we make with the e=uipment we already own?J "his is a production orientation.
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,hapter 1 9 An 'verview of /arketing 1C. When is a firm with a production orientation most likely to survive? a. if there are many small competitors in the marketplace b. if demand for the product it produces e;ceeds supply c. if the needs of the marketplace are constantly shifting d. if supply for the product it produces e;ceeds demand ANS: (
"he production orientation can survive in the short term under a variety of conditionsH however2 if market needs change2 long+term survival is difficult.
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1*. What type of orientation to marketing does a firm have if it fails to consider whether what the
firm + manufactures most efficiently also meets the needs of the marketplace? a. customer b. product c. market d. production
ANS:
"he production orientation forces a company to build whatever it builds bestH that is2 whatever it has the e;perience and e;pertise in doing.
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11. /imi ,outurierDs fashion designers use computer+assisted design software to create what it
thinks women should wear. "he company regularly hires industry e;perts to e;amine its factories to find waste and inefficiencies that can be eliminated. "he company has e;panded the number of products it offers for sale many times. 5owever2 for the last two years /imi ,outurier has lost money2 and it has had to lay off some of its workforce. "o avoid this occurrence in the future2 what should the company do? a. hire more retail efficiency e;perts to trace down any production problems b. increase its sales force to find more potential customers for the firm c. have someone study its target market to see what needs and wants should be met by /imi ,outurier d. cut prices so that its prices will be at least 1* percent below those of its competitors
ANS: ,
/imi ,outurier has been production oriented. @t should develop a market orientation2 which means the firm will produce only those items needed by its target market.
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,hapter 1 9 An 'verview of /arketing 11. 'rgani7ations that sell products that are often unsought 3such as life insurance and retirement
plans4 may find themselves adopting which type of orientation? a. sales b. production c. marketing d. customer
ANS: A
Aggressive selling is sometimes used by companies that sell products their customers do not want to buy2 or do not think they need.
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1&. %or years2 #ichard (ranson2 founder of the Kirgin Froup has believed in customer service.
5e believes that good customer service stems from an environment that is founded on Ia chain 2 one that is consistent from beginning to end? J Which idea has + Kirgin Froup captured in this short phrase? a. the societal concept b. /aslowDs hierarchy of needs c. the marketing concept d. the sales orientation philosophy
ANS: ,
"he marketing concept Bustifies a companyDs e;istence by its ability to satisfy customers.
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16. Which orientation assumes people will buy more if aggressive selling techni=ues are used? a. market b. sales c. customer d. production ANS: (
"he sales orientation assumes aggressive selling is needed to increase demand.

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,hapter 1 9 An 'verview of /arketing 1:. @nnovative Silversmiths creates and markets silver and tur=uoise Bewellery2 which it sells to
retailers. "he companyDs management believes its retail customers will stock more Bewellery if its salespeople use aggressive marketing techni=ues. Which type of orientation does the company have? a. customer b. production c. sales d. market
ANS: ,
'nly the sales orientation assumes aggressive sales techni=ues will sell more product2 regardless of customer desires and needs.
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1<. @f a company uses a sales orientation2 what would consumer complaints most likely result in? a. a modification of the sales presentation b. product reinvention c. continuous market research d. attempts to cut production costs ANS: A
"he sales orientation relies on aggressive sales techni=ues to fuel business.

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1?. Which of the following is done by a company that has a market orientation and adheres to the
marketing concept? a. integrates all the activities of the firm to satisfy customer wants b. focuses on company needs and wants c. differentiates the firmDs products from its other products d. fuels sales growth through the application of aggressive sales techni=ues
ANS: A
Aggressive sales techni=ues are part of the sales orientation and are not needed if a company is meeting needs and wants of its customers.
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,hapter 1 9 An 'verview of /arketing 1A. Which of the following statements best describes a sales+oriented business? a. "he company develops its products to meet the needs of specific groups of people. b. "he companyDs primary goal is profit through customer satisfaction. c. "he company invests the maBority of its resources in promoting its products and
services.
d. "he company is in business to satisfy customersD wants and needs and deliver
superior value.
ANS: ,
See #eview 0earning 'utcome &.

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1C. 'ne way to identify the orientation of a firm is to e;amine its primary goal. What type of
marketing management philosophy does a firm practice that seeks to achieve profitability through sales volume? a. societal marketing orientation b. market orientation c. sales orientation d. production orientation
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&*. ,anon ,omputer !roducts has improved the efficiency and productivity of its plant2 which
manufactures printing technology. %or the new fiscal year2 the company proBects a production increase of 1: percent2 and has instructed its sales force to aggressively distribute the product. What type of marketing management philosophy is ,anon practicing? a. sales orientation b. production orientation c. market orientation d. societal marketing orientation
ANS: (
,anon has a sales orientation.

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)ac=ues "orres ,hocolate is a factory and retail store. @ts owner is willing to try to produce new products when his customers suggest themGsuch as chili+pepper+laced chocolate candy. 5is only condition is that when he adds new products2 his customers have the final say on whether the product is of any value. According to "orres2 I@f something doesnDt move2 thatDs the last time you see it.J
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,hapter 1 9 An 'verview of /arketing &1. 5ow does )ac=ues "orres ,hocolate keep its customers coming back? a. directs its chocolates to the Iaverage customerJ b. seeks its goals primarily through the use of intensive promotion c. has an inward focus on the organi7ationDs needs d. profits through customer satisfaction ANS:
)ac=ues "orres ,hocolate has a market orientation.

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&1. "he manufacturer of ,ountry Litchen Art bowls2 spoons2 and cutting boards knows marketing
can make his company a success. 5e wants to rely solely on promotion as the techni=ue for attracting customers. 5e advertises e;tensively in cooking maga7ines2 offers coupons2 and provides retailers who carry his product with attractive displays. %rom this information2 what sort of orientation does ,ountry Litchen Art have? a. market b. societal c. production d. sales
ANS:
A sales+oriented organi7ation views promotions as the primary tool used to achieve its goals.
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&&. ,anon ,omputer !roducts has improved the efficiency and productivity of its plant2 which
manufactures printing technology. %or the new fiscal year2 the company proBects a production increase of 1: percent. @t has instructed its sales force to aggressively distribute and promote its printers. "he ,$' is sure the market will absorb more product if the sales force is determined and assertive. What sort of orientation does ,anon appear to have? a. market b. production c. sales d. customer
ANS: ,
A sales orientation is based on the belief that people will buy more goods and services if aggressive sales techni=ues are used.
!"S: 1 #$%: : '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy- "(.$ /odel !roduct (0/: 5igher 'rder &6. When light bulbs were first introduced2 manufacturers offered one si7e for all light fi;tures.
"oday you can buy light bulbs in different shapes2 wattages2 and colours. 0ight bulbs also differ as to how much electricity they use and how many hours of illumination they will provide before failing. Which of the following demonstrates how light bulb manufacturers practice the marketing concept?
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,hapter 1 9 An 'verview of /arketing a. b. c. d.
"hey target only the largest customers. "hey recogni7e different customer groups have different needs and wants. "hey are sales+oriented companies instead of production+oriented companies. "hey are companies that would state they are in the business of selling all light bulbs.
ANS: (
'ne way to implement the marketing concept is to concentrate on the needs of specific groups of customers.
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&:. 0ululemon has become one of the nationDs largest specialty retailers by focusing on the
customerDs needs and wants. "his philosophy is at the heart of which type of orientation? a. sales b. market c. retail d. production
ANS: (
A market+oriented philosophy is based on the consumerDs wants and needs2 and the organi7ation will focus its activities on satisfying these customers by listening to them and revising strategies as necessary.
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&<. As it evolves from a credit+card company to one with greater emphasis on electronic
payments2 Kisa is launching its first maBor rebranding campaign in 1* years. "he companyDs new promotional slogan is I0ife "akes Kisa.J "hrough the use of this slogan2 Kisa shows how much it wants to become an integral part of its customersD everyday lives. Which type of orientation is Kisa using? a. market b. sales c. product d. societal
ANS: A
A market+oriented philosophy is based on consumersD wants and needs2 and the organi7ation will focus its activities on satisfying these customers by listening to them and revising strategies as necessary.
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&?. What do companies that rely on the marketing concept and that have implemented a market
orientation strategy recogni7e? a. !rice is the most important variable for customers. b. Sales depend predominantly on an aggressive sales force. c. What the customer thinks he or she is buying is what is important.
,hapter 1 9 An 'verview of /arketing d. Selling and marketing are essentially the same thing. ANS: ,
"he perceived product and perceived value are what the customer is buying2 and the marketing concept and market orientation have endeavoured to understand those perceptions.
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&A. "he statement I/arketing should be introduced at the beginning rather than the end of the
production cycle and integrated into each phase of the business2J is consistent with which type of orientation? a. production b. market c. retail d. sales
ANS: (
Mnderstanding the competitive arena and competitorsD strengths and weaknesses is a critical component of market orientation.
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&C. /inor 0eague (aseball suffers from sluggish attendance. "o attract more fans to their games2
owners often resort to gimmicksGfree hot dog nights2 events designed to get into the Fuinness (ook of #ecords2 and celebrity visits. Salesmen for the teams and sports store owners try to push the sales of tickets onto local softball teams2 what type of marketing management philosophy are they practicing? a. sales orientation b. market orientation c. production orientation d. societal marketing orientation
ANS: A
"he marketing concept and a market+oriented philosophy is based on the consumerDs wants and needs2 and the organi7ation will focus its activities on satisfying these customers by listening to them and revising strategies as necessary. "hey are not doing this rather they are pushing the tickets onto customers which is a sales orientation.
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do not market and that they never have marketed.J 5e concludes2 IWhat librarians need to tell people is not how wonderful our public libraries are but rather how wonderful they could be.J @f librarians were to use the marketing concept they would do which of the following? a. focus on satisfying the needs of their customers. b. order more books. c. promote their e;isting collections better.
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,hapter 1 9 An 'verview of /arketing d. have more celebrity authors do readingsa customer orientation. ANS: A
"he marketing concept is based on satisfying the consumerDs wants and needs.
!"S: 1 #$%: < '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer- "(.$ /odel !roduct (0/: 5igher 'rder 61. "he manufacturer of 'mega brand watches has a market orientation and adheres to the
marketing concept. Which of the following describes the first action the company would most likely take if it learned its customers were dissatisfied with its watches? a. hire more salespeople b. conduct research to determine if its customersD needs have changed c. increase its advertising to underserved markets d. increase the number of Bewellery stores that carry 'mega watches
ANS: (
A marketing concept and market+oriented philosophy are based on the consumerDs wants and needs2 and the organi7ation will focus its activities on satisfying these customers by listening to them and revising strategies as necessary.
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61. #ose is a telephone order taker for (rylane2 a catalogue retailer of furnishings for bedrooms
and baths. A customer called and asked if the sea green in a bedspread she had purchased matched the green in a lamp offered in the newest (rylane catalogue. #ose got the potential customerDs phone number2 went out to the warehouse2 located the items2 determined they did not match2 and called the potential customer to tell her that information. Which type of orientation is illustrated by #oseDs actions? a. societal b. market c. sales d. production
ANS: (
A market+oriented philosophy is based on the consumerDs wants and needs2 and the dealer satisfied these needs by providing e;cellent customer service2 which resulted in further business. (uilding a relationship with this customer was an important key.
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6&. What does the marketing concept involve? a. focusing on customersD wants so that the organi7ation can distinguish its product
3or products4 from the competitorsD products b. selling books at the highest prices that the market will bear with the idea of ma;imi7ing profits in the short run c. selling as much product as possible under the assumption people will buy more goods and services if aggressive selling techni=ues are used
,hapter 1 9 An 'verview of /arketing d. focusing on production in order to increase product =uality and lower prices ANS: A !"S: 1 #$%: : "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+1 (0/: #emember
66. "he marketing concept includes a goal orientation to remind managers of which of the
following? a. Achieving long+term organi7ational goals is as important as satisfying customers. b. ,ustomers must be satisfied no matter what the long+term effect on the firm. c. "he only reason for any business to e;ist is to make a profit. d. "he obBective is to find a target market that differs from that of the competition.
ANS: A
"he goal orientation refers to the companyDs goals2 such as profit2 growth2 service2 and survival.
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ue to consumer concerns about skin cancer and other negative outcomes associated with sun e;posure2 the trend in sun+care products throughout most of the 1CC*s was in favour of higher+S!% sunscreens. "his seems to be changing now2 at least for some target segments. @n response to the latest trends of teenagers using baby oil2 ,risco2 and even motor oil to enhance tanning effects2 ,oppertone and 5awaiian "ropic have introduced new low+MK+protection products. Fiving customers what they want demonstrates which of the following types of orientation? a. sales b. sales c. societal marketing d. market
ANS:
Selling low+S!% products to satisfy the needs and wants of the teenage market is a market orientation.
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,hapter 1 9 An 'verview of /arketing 6<. "he marketing concept stresses that the social and economic Bustification for an organi7ationDs
e;istence is the satisfaction of customer needs and wants while doing which of the following? a. producing a good or service at the lowest possible cost b. simultaneously meeting organi7ation obBectives c. constantly increasing sales volumes d. applying scientific management techni=ues to improve efficiency
ANS: (
"he marketing concept holds that the needs and wants of both the customer and the firm be served.
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epot to buy what he thought he needed to fi; a leaking toilet2 he gathered up materials totalling almost E?*. 'n his way to checkout2 an employee asked him what he was trying to fi;. After some discussion2 the employee convinced the homeowner that a E:.CC replacement part would fi; the problem better than the materials he thought he needed and with less trouble. "his sort of discussion between employees and customers is commonplace at "he 5ome epot and indicates the retail store has which type of orientation? a. sales b. market c. product d. e;change
ANS: (
"he marketing concept2 the foundation of a market orientation2 holds that the needs and wants of both the customer and the firm be served.
!"S: 1 #$%: : '(): *1+1 "'!: AA,S( Analytic- "(.$ /odel ,ommunication- "(.$ /odel ,ustomer (0/: 5igher 'rder 6A. World Wrestling $ntertainment 3formerly the World Wrestling %ederation4 is very focused on
what its fans want2 in terms of product licensing and2 more importantly2 in terms of plot lines and character development. All of the companyDs activities are integrated so that no employee ever loses sight of the companyDs desire to satisfy its fans. What type of orientation does World Wrestling $ntertainment have? a. sales b. market c. product d. societal
ANS: (
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1+1<
,hapter 1 9 An 'verview of /arketing 6C. 0evi Strauss has developed the Naturals line of Beans that do not use any chemical dyes to
colour the pants. ,onsumers like the look of the Beans2 and 0eviDs use of all+natural dyes is good for the environment. "he production of the Naturals line would be consistent with which type of orientation? a. societal marketing b. supplier c. sales d. production
ANS: A
Societal marketing orientation is the idea that an organi7ation e;ists not only to satisfy customer wants and needs and to meet organi7ational obBectives but also to preserve individualsD and societyDs long+term best interests.
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:*. "here is no effective way to prove the legality of wood from places like @ndonesia2 where as
much as A* percent is cut illegally. #etailers like "he 5ome epot do not want to sell timber from illegally logged forests2 even though the demand is great for timber from rainforests. "o prove an interest in preserving rainforests2 two @ndonesian logging companies have developed a bar coding system2 which proves the timber was legally ac=uired. What type of orientation is indicated by this focus on customersD needs? a. market b. supplier c. sales d. production
ANS: A
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1+1?
,hapter 1 9 An 'verview of /arketing :1. Shoppers at a supermarket can re=uest Smart !artner cards. A percentage of the amount of
money each shopper spends is given to a school the customer has chosen. What type of orientation has the store shown by instituting the Smart !artner program to help local schools? a. societal marketing b. supplier c. sales d. philanthropic
ANS: A
Societal marketing orientation is the idea that an organi7ation e;ists not only to satisfy customer wants and needs and to meet organi7ational obBectives but also to preserve individualsD and societyDs long+term best interests.
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:1. )ewellery stores want to provide their customers with the highest =uality of diamonds
available at the lowest possible prices. Mnfortunately2 the lowest+priced diamonds these days are sold by African rebels who use the profits to engage in genocide. 5uman rights organi7ations have asked Bewellers to buy diamonds that are Iconflict+free2J that is2 from South Africa2 Australia2 or ,anada. 0ee(rant is one retail Bewellery store that sells only diamonds that are certified to be from these countries. 'ne could say that 0ee(rant has which of the following type of orientation? a. production b. sales c. societal marketing d. market
ANS: ,
0ee(rant has a societal marketing orientation because it is trying to not only satisfy customersD wants but also enhance societyDs long+term best interests. "he other Bewellers that continue to sell diamonds purchased from the rebels are more interested in satisfying their customersD desire for lower prices than in serving society.
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:&. What do market+oriented firms primarily focus their efforts upon? a. improving the technological skills and competitive advantages of the firm b. satisfying the wants and needs of their customers c. achieving the companyDs societal responsibilities ine;pensively d. distributing goods and services ANS: (
/arket+oriented firms are focused outward toward their customers.

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1+1A
,hapter 1 9 An 'verview of /arketing :6. An organi7ation believes that it e;ists to not only satisfy customer wants and needs and meet
organi7ational obBectives2 but also preserve or enhance individualsD and societyDs long+term best interests. What type of orientation does the organi7ation have? a. sales b. market c. ethical business mission d. societal
ANS: !"S: 1 #$%: < "'!: AA,S( iversity- "(.$ /odel ,ustomer '(): *1+1 (0/: #emember
::. /ost companies become sensiti7ed to community issues only after theyDve done enough
damage to draw the localsD anger. ofasco2 @nc.2 a highly successful steel company in 'ntario2 tries to get ahead of business and community issues by annually bringing together representatives from the local area and deciding what proBects to improve the local environment will be implemented. "his annual community+wide meeting indicates that ofasco has which type of orientation? a. societal marketing b. sales c. product d. philanthropic
ANS: A
Societal marketing orientation is the idea that an organi7ation e;ists to not only satisfy customer wants and needs and meet organi7ational obBectives2 but also preserve individualsD and societyDs long+term best interests.
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:<. LinkoDs copy shops use the e=uivalent of 1*.: s=uare miles of forest to produce all of the
paper needed by the corporation annually. While the company is committed to making a profit2 it is also committed to preserving the environment. #ecently2 LinkoDs wrote an environmental vision in which it committed the company to conserving natural resources. With this environmental vision2 what type of orientation did LinkoDs adopt? a. societal marketing b. sales c. reciprocal e;change d. production
ANS: A
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1+1C
,hapter 1 9 An 'verview of /arketing :?. !rocter . Famble decided to address the fact that ,hinese ,anadian women are more likely
to die from breast cancer because theyDre reluctant to get mammograms or discuss screening. So !.F brought screening to supermarkets2 parking mobile mammography vehicles in grocery store parking lots and inviting shoppers in for free N+rays. "ie+ins with local hospitals assured that women with suspicious films got follow+up care. What type of orientation did !.F adopt to achieve this goal? a. promotional b. societal marketing c. customer d. marketing
ANS: (
!"S: 1 #$%: < '(): *1+1 "'!: AA,S( iversity- "(.$ /odel ,ustomer- "(.$ /odel !romotion (0/: 5igher 'rder :A. After hearing his company critici7ed for aggressive selling2 the ,$' of a company that
manufactures products used to care for horses has determined that his company needs to adhere to the marketing concept and implement a market+oriented strategy. Which of the following is the first action the company should take in order to achieve this goal? a. reorgani7e the company and make marketing its most important department b. hire new salespeople to find new customers for its horse care products c. e;pand the advertising budget to make potential customers more aware of its products and how they benefit horses d. create cross+functional teams and instruct them to focus on creating greater customer value
ANS:
/arket+oriented companies are successful in getting all business functions working together to deliver customer value.
!"S: 1 #$%: : '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel /arketing !lan (0/: 5igher 'rder :C. What is defined as the relationship between benefits and the sacrifice necessary to obtain
those benefits? a. opportunity cost b. marketing utility c. market =uality d. customer value
ANS: !"S: 1 #$%: ? "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+& (0/: #emember
1+1*
,hapter 1 9 An 'verview of /arketing <*. An e;pert in library science stated in Library Journal2 IWhat librarians need to tell people is
not how wonderful our public libraries are but rather how wonderful they could be.J What is the library science e;pert saying that libraries need to do? a. be concerned with creating customer value b. assess what services are most convenient for libraries to offer c. determine where their talents and abilities lie d. better promote the libraries books and services
ANS: A
"he value customers perceive they can receive is determined by how well the service satisfies its customersD needs. Alternatives b2 c2 d2 and e describe characteristics of a production+ oriented company.
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<1. ,anada !ost argues that its e;press service is comparable to what is offered by %ed$; and that
its prices are much lower. Oet %ed$; dominates2 with more than a 6: percent share of the e;press+delivery market. Why does %ed$; have a higher market share? a. ,anada !ost is perceived as offering greater customer value. b. %ed$; is perceived as offering greater customer value. c. %ed$; and ,anada !ost offer the same customer value. d. ,ustomer value is not an issue in deciding between %ed$; and ,anada !ost.
ANS: (
,ustomer value is defined as the relationship between benefits and the sacrifice necessary to obtain those benefits.
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<1. #ose is a telephone order taker for (rylane2 a catalogue retailer of furnishings for bedrooms
and baths. When a customer called and asked if the sea green in a bedspread she had purchased matched the green in a lamp offered in the newest (rylane catalogue2 #ose got the potential customerDs phone number2 went out to the warehouse2 located the items2 determined they did not match2 and called the potential customer to tell her that information. What was the most likely result of #oseDs efforts? a. management empowerment b. retailer9customer synergy c. customer satisfaction d. transactional marketing
ANS: ,
When customer e;pectations regarding product =uality2 service =uality2 and value+based price are met or e;ceeded2 customer satisfaction is created.
<&. What does Nero; emphasi7e by replacing at its own e;pense any dissatisfied customerDs
e=uipment within a period of three years after purchase?

,hapter 1 9 An 'verview of /arketing a. b. c. d.
management empowerment management9customer synergy customer satisfaction transactional marketing
ANS: ,
When customer e;pectations regarding product =uality2 service =uality2 and value+based price are met or e;ceeded2 customer satisfaction is created.
<6. What should a retail casket outlet do if it wishes to offer customer value? a. give the customers more choice in which casket to choose b. charge E&** for a pine casket instead of the inflated price of E12*** charged by
many funeral homes c. offer free services to go along with the casket d. provide customers with only a few casket choices
ANS: ,
A business interested in offering customer value should give customers more than they e;pect Gand most would certainly e;pect delivery and some kind of credit plan. "his business should also give buyers the facts. No business likes competition.
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<:. What is created when customer e;pectations regarding product =uality2 service =uality2 and
value+based price are met or e;ceeded? a. a value line b. =uality products c. planning e;cellence d. customer satisfaction
ANS: !"S: 1 #$%: A '(): *1+& "'!: AA,S( #eflective "hinking- "(.$ /odel !ricing- "(.$ /odel !roduct- "(.$ /odel ,ustomer (0/: #emember <<. What gives customers the feeling their concerns are being addressed and2 at the same time2
gives employees the feeling their e;pertise matters to management? a. management9employee synergy b. positive feedback c. managerial reciprocity d. empowerment
ANS: !"S: 1 #$%: C "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+& (0/: #emember
1+11
,hapter 1 9 An 'verview of /arketing <?.
ominoDs !i77a is offering racing fans a chance to earn points toward NAS,A#+branded merchandise via the NAS,A# #ace!oints loyalty program. ,onsumers who buy E1* worth of ominoDs !i77a will receive 1** NAS,A# #ace!oints. NAS,A# #ace!oints will be credited to membersD accounts. #acing fans can collect points to earn NAS,A# merchandise2 including apparel and hats or one+of+a+kind e;periences2 such as driving a real race car. What is ominoDs engaging in? a. transactional marketing b. sports distribution+ marketing c. relationship marketing d. one+to+one marketing
ANS: ,
#elationship marketing is a strategy that entails forging long+term partnerships with customers.
!"S: 1 #$%: A+C '(): *1+& "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer- "(.$ /odel !romotion (0/: 5igher 'rder <A. Which of the following strategies entails forging long+term partnerships with customers? a. commitment selling b. relationship marketing c. transactional marketing d. market engineering ANS: ( !"S: 1 #$%: A+C "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+& (0/: #emember
<C. %re=uent+flyer programs are an e;ample of financial incentives to customers in e;change for
their continuing patronage. After flying a certain number of miles or flying a specified number of times2 the fre=uent+flyer program participant earns a free flight or some other award such as free lodging. What are airlines that use fre=uent+flyer programs practising? a. one+to+one marketing b. transaction marketing c. transformational marketing d. relationship marketing
ANS:
"he strategy that entails forging long+term partnerships with customers is called relationship marketing.
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1+1&
,hapter 1 9 An 'verview of /arketing ?*. Shoppers at a supermarket can re=uest Smart !artner cards. A percentage of the amount of
money each shopper spends is given to a school the customer has chosen. 5ow is the store using the Smart !artner cards? a. as a part of its commitment selling b. as a part of its transaction marketing c. as a part of its retailer9customer synergy d. as a part of its relationship marketing
ANS:
"he strategy that entails forging long+term partnerships with customers is called relationship marketing.
?1. ,anadian Smoked "urkey2 @nc. is mail+order business that operates without any advertising. @t
does not accept credit cards and has no toll+free number for customers to call. @t may be old+ fashioned but it is also a very profitable company with thousands of loyal customersGsome of whom have ordered from ,anadian Smoked "urkey every year for the last :* years. What does ,anadian Smoked "urkey probably use to maintain these long+term ties to its customers? a. reactive marketing b. synergistic management c. relationship marketing d. promotional marketing
ANS: ,
#elationship management is a strategy that entails forging long+term partnerships with customers.
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?1. /any companies are improving plant tours and making store visits more e;citing to increase
customer loyalty. %or e;ample2 at the ,rayola %actory2 kids watch how crayons are made and then play with their favourite colours in a 1*2*** s=uare+foot discovery centre. $mployees circulate to ensure visitors have a wonderful time. What plays a key role in ,rayolaDs implementation of the marketing concept? a. customer+oriented personnel b. a sales orientation c. a societal marketing orientation d. customer outreach
ANS: A
,ustomer+oriented personnel strengthen the positive image of an organi7ation.

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?&. Which of the following measures would be the best indicator of whether your organi7ationDs
personnel have a customer orientation? a. Ask each employeeDs boss if that person is customer oriented.
,hapter 1 9 An 'verview of /arketing b. Assess each employeeDs impact on the profitability of the firm. c. Survey customers on how oriented the organi7ationDs employees are to customer
needs and desires. d. Assess how well each employee has contributed to the marketing success of the firm by e;amining every financial statement created by the organi7ation.
ANS: ,
"he key to assessing how customer oriented a firmDs personnel are is to ask the customer. 'nly the customer can provide this type of information.
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?6. "a;i companies in many large metropolitan areas are re=uiring newly licensed ta;i drivers to
undergo a two+day training seminar during which they learn basic eti=uette in addition to a familiarity with common landmarks and street names. What is the purpose of this training? a. to improve customer service b. to give higher education benefits to employees c. to promote the company image by increasing public awareness d. to improve employee satisfaction
ANS: A
0eading marketers recogni7e the role of employee training in customer service.

!"S: 1 #$%: C '(): *1+& "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer- "(.$ /odel /arketing !lan (0/: 5igher 'rder ?:. Some market+oriented firms give employees e;panded authority to solve customer problems
on the spot. What is this known as? a. relationship selling b. deregulation c. empowerment d. commissioning
ANS: , !"S: 1 #$%: C "'!: AA,S( ,ommunication- "(.$ /odel ,ustomer '(): *1+& (0/: #emember
1+1:
,hapter 1 9 An 'verview of /arketing ?<. Networkcar.com sells a plug+in device that connects to computer diagnostic ports that are
standard on cars. "he device beams signals to dealers who can remotely diagnose or spot trouble. "he device allows car dealerships to maintain a closer bond with their customers by offering maintenance before a problem leaves customers with an inoperable or possibly dangerous car. With the device2 what can dealers better engage in? a. management empowerment b. management9customer synergy c. relationship marketing d. transactional marketing
ANS: ,
#elationship management is a strategy that entails forging long+term partnerships with customers.
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??. "he management at %airmont 5otels has authori7ed its hotel staff to provide whatever
amenityGsuch as a special maga7ine or a hypoallergenic pillowGtheir fre=uent stayers re=uest as =uickly as possible. What is %airmont management using to provide customer value? a. relationship selling b. deregulation c. empowerment d. commissioning
ANS: ,
%airmont management gave employees e;panded authority to solve customer problems on the spot.
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?A. What should a marketing director do as part of instituting an empowerment program? a. !ut employees through simulation situations in their training b. ,reate a customer+service department and place a key staff person in charge of the
department.
c. "rain the companyDs staff to Budge the =uality of the products the firm produces. d. Allow non+management employees to resolve problems on their own without prior
approval from their immediate supervisors.

ANS:
$mpowerment refers to firms that give employees e;panded authority to solve customer problems on the spot without having to get managementDs permission first.
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1+1<
,hapter 1 9 An 'verview of /arketing ?C. What is the term for the collaborative efforts of people to achieve common obBectives? a. synergy b. teamwork c. empowerment d. ')" training ANS: ( !"S: 1 #$%: 1* "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy '(): *1+& (0/: #emember
ofasco2 @nc. is a ,anadian steel manufacturer. According to its ,$'2 I!eople can make a phenomenal difference if you stop telling them to come to work2 put their brains in a bo;2 and do whatever the supervisor says. We let our employees work in teams.J
A*. #efer to
ofasco. "his =uote implies that as a direct result of employees using more teamwork2 ofascowill be able to do which of the following? a. operate successfully using a production orientation. b. provide its customer with a higher level of satisfaction. c. have lower levels of employee turnover. d. have higher levels of employee satisfaction.
ANS: (
"eamwork is one way a company with a market orientation creates customer satisfaction.
!"S: 1 #$%: 1* '(): *1+& "'!: AA,S( Analytic- "(.$ /odel ,ustomer A1. #efer to ofasco. 5ow would teamwork benefit ofasco? a. by enhancing employee performance b. by doing away with the need for empowerment c. by creating managerial entropy d. by refining the definition of customer value ANS: A (0/: 5igher 'rder
$nhanced employee performance leads to improved customer satisfaction.

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1+1?
,hapter 1 9 An 'verview of /arketing A1. @f a mattress manufacturer redefines the business mission as Ia good nightDs sleepJ rather than
stating it as Ithe manufacture of high+=uality mattresses2J what is the likely result? a. @t will not stimulate an awareness of changes in consumer desires. b. @t will be too broad a statement to be of any real use in serving customers. c. @t will attract the high end buyers where more profits are made. d. @t will help ensure the firm retains its focus on consumers and does not become preoccupied with its products and internal needs.
ANS:
"he broader business mission of Ia good nightDs sleepJ will stimulate innovation and creativity because not all sleep aids are mattresses. @t will lead the company to further growth.
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A&. 'ne of the reasons given for the decline of the passenger rail industry is that the industry
defined its mission as trains and not as transportation sources. What did the railroad industry fail to do? a. define its mission in terms of the benefits its customers seek b. convince airline and car passengers to switch to rail c. reali7e Icustomers only want what they knowJ d. have a sales orientation
ANS: A
A market+oriented firm defines its business in terms of the benefits its customers seek. (ecause of the limited way the railroad industry defined its business2 it missed an opportunity to define itself in terms of the benefits customers were seeking.
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A6. What marketing tools does the organi7ation use to achieve its goals? a. advertising and personal selling + b. production2 promotion2 and pricing c. the marketing mi; d. aggressive promotion ANS: , !"S: 1 #$%: 11-11 "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+& (0/: 5igher 'rder
1+1A
,hapter 1 9 An 'verview of /arketing A:. What is the primary tool used by a sales+oriented organi7ation to achieve its corporate goals? a. price b. promotion c. product design d. place 3distribution4 ANS: (
A sales+oriented organi7ation seeks to generate sales volume based upon intensive promotional activities.
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A<. What is the primary tool used by a market+oriented organi7ation to achieve its goals? a. a blend of product2 place2 promotion2 and pricing decisions b. price c. product design d. place 3distribution4 ANS: A
A market+oriented organi7ation seeks to generate sales volume based on serving customer needs and wants2 utili7ing all of the elements of the marketing mi; to do so.
!"S: 1 #$%: 11-11 '(): *1+& "'!: AA,S( #eflective "hinking- "(.$ /odel istribution- "(.$ /odel !ricing- "(.$ /odel !roduct- "(.$ /odel !romotion (0/: 5igher 'rder A?. According to your te;tbook2 which if the following is a valid reason to study marketing? a. /arketing teaches students how to sell all types of products and services. b. /arketing plays an important role in society2 coordinating the huge numbers of
transactions needed to provide goods and services.

c. /arketing is used in many types of organi7ations but not charities and
government.
d. /arketing offers more money than other disciplines like finance. ANS: (
@t is a myth that marketing can make anyone buy something they donDt needH there are many career opportunities in marketing and it plays a maBor role in any business.
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1+1C
,hapter 1 9 An 'verview of /arketing AA. Which of the following statements best describes the importance of studying marketing? a. /arketing teaches students how to sell products that people do not need. b. /arketing deals with transactions2 not relationships. c. /arketing is seen by everyone many times in a day. d. /arketing offers outstanding career opportunities. ANS:
/arketing plays an important role in society2 coordinating the huge numbers of transactions needed to provide goods and services. /arketing affects your day+to+day life as a consumer.
AC. What is the fundamental obBective of most businesses? a. employee empowerment2 teamwork2 and relationship marketing b. survival2 profits2 and growth c. low costs and high =uality d. customer loyalty and retention ANS: (
"he use of marketing allows businesses to achieve this obBective.

C*. Wilson is an agriculture and dairy science maBor at a university. After graduation2 he hopes to
moderni7e and e;pand his familyDs dairy farm in a scientific and efficient manner. 5is adviser at school has suggested he take a marketing course in the school of business as an elective. Wilson thinks this is an absurd idea. Oou are his friend and a marketing maBor. What do you advise? a. /arketing knowledge will help Wilson to understand that he must satisfy wholesalers2 retailers2 and consumers. b. Wilson should also take a finance course to further broaden his business knowledge. c. /ore biology and agriculture classes will be most useful for Wilson2 he should leave marketing to the e;perts and pay consultants when he needs them. d. "he main reason to take marketing is to teach Wilson how to advertise milk.
ANS: A
/arketing is an important conceptual base that will help Wilson to assess the needs and wants of his various business contacts and customers. /arketing is a key component of every business.
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1+&*
,hapter 1 9 An 'verview of /arketing C1. )amie owns a small moving company. She has decided to take a few night school business
courses because her company is growing =uickly and there are many things she does not understand. Should )amie enrol in a marketing course? a. Oes2 because marketing is synonymous with selling2 and )amie will want to learn sales techni=ues to continue the growth of the company. b. Oes2 because the concept of marketing will help )amie to better satisfy her customers. c. No2 because marketing should be done by e;perts not someone who has taken one course. d. Oes2 because marketing helps businesses sell products that people wouldnDt have thought to buy without being marketed to.
ANS: (
"he marketing concept stresses the commitment to satisfying customer needs and wants with an entire range of marketing tools2 not Bust selling or advertising.
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@n 1CC:2 ,hrysler ,orporation launched the first complete remake of its minivan category since the firm invented the vehicle category in 1CA6. "he minivans were redesigned with more curves on the outside and more space on the inside. 'ne of ,hryslerDs goals was to broaden the minivanDs appeal beyond the traditional buyer base of practical families. Advertising showed minivans being used to cart everything from senior citi7ens to canoes. IA minivan is for any time2 any place2 everyone2J was one of the promotional slogans used. "o reach other customer groups2 ,hrysler developed a sports version and a short+wheel+base version of the upscale "own and ,ountry model for sophisticated buyers. ,hrysler hoped the E1.< billion vehicle development cost would pay off as the market e;panded. 5owever2 competitors also began to offer a wider range of sophisticated models2 and competition has become fierce.
C1. When ,hrysler first launched the minivan2 the company offered only one version and was
focused on generating sales volume through intensive advertising. "his approach suggests the company had which type of orientation? a. sales b. market c. production d. societal
ANS: A
Sales+oriented organi7ations seek to generate sales volume based on intensive advertising2 while market+oriented organi7ations recogni7e that promotion is only one of four basic marketing tools.
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1+&1
,hapter 1 9 An 'verview of /arketing C&. "he minivans were developed through an e;tensive investment in research and development
to completely redesign the minivans and provide customers with new and updated features. "his effort is designed to better meet consumersD wants and needs2 and suggests the company has adopted which type of orientation? a. societal b. sales c. production d. market
ANS:
A market+oriented philosophy is based on consumersD wants and needs.

!"S: 1 #$%: :+< '(): *1+1 "'!: AA,S( Analytic- "(.$ /odel #esearch- "(.$ /odel ,ustomer (0/: 5igher 'rder C6. (y introducing sporty2 value+priced2 and upscale minivans2 ,hrysler hoped to forge a long+
term relationship with customers as they replace their older minivan. What is ,hrysler engaged in? a. empowerment b. customer valuation c. relationship marketing d. outward focus management
ANS: ,
#elationship marketing seeks to forge long+term partnerships with customers.

C:. ,hrysler set up a team of special customer+service representatives who assist minivan buyers
and who are authori7ed to solve problems immediately. What were these employees given? a. authority training b. delegation c. cross+utili7ation d. empowerment
ANS:
elegation of authority to employees is empowerment.

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1+&1
,hapter 1 9 An 'verview of /arketing
As recently as 1* years ago circuses came to town with tents2 animals2 clowns2 and other performers. An advance man arrived about two weeks before the circus actually arrived2 covered the community with posters2 and gave out free tickets to schoolchildren. @f the advance man had done a good Bob2 when the circus arrived and opened its tent doors2 &** to <** people would fill its seats. When the largest circus organi7ations merged2 the newly formed #ingling (ros. and (arnum . (aileyDs Freatest Show on $arth began performing in 62***+seat arenas. Attendance2 however2 has stagnated in recent years. !eople have stopped going to the circus because they miss the circus tent and the close intimate atmosphere it created. "he newest thing in circuses is a return to the tent atmosphere with an emphasis on the types of entertainment that were popular years ago. Anti=ue circus wagons2 calliope music2 and cotton candy are replacing the e;otic animals and the prima donna performers. "o satisfy the needs of this new audience2 the tent circus now sells lattes and wine.
C<. "he aggressive promotions used by advance men indicate that two decades ago the circuses
probably had which type of orientation? a. sales b. market c. production d. societal

ANS: A
Sales+oriented organi7ations achieve their sales goals primarily through intensive promotion.
!"S: 1 #$%: :-11-11 '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel #esearch (0/: 5igher 'rder
C?. Now circuses are trying to satisfy customersD needs and wants and to profit through customer
satisfaction. What type of orientation have they adopted? a. societal b. selling c. production d. market
ANS:
A market+oriented philosophy is based on consumersD wants and needs.

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1+&&
,hapter 1 9 An 'verview of /arketing CA. What could circuses do to e;hibit a societal marketing orientation? a. rely on publicity and avoid any promotions b. empower their employees to satisfy customer wants c. donate a percentage of their profits to local educational institutions d. emphasi7e customer value ANS: ,
"he philosophy called the societal marketing orientation states that an organi7ation e;ists to not only satisfy customer wants and needs and meet organi7ational obBectives2 but also preserve or enhance individualsD and societyDs long+term best interests.
!"S: 1 #$%: < '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy (0/: 5igher 'rder
CC. 'ne of the tent venues is called (arnumDs Laleidoscape2 and it is in a permanent location with
the hopes that people who see the show will want to return and see it again as well as bring their friends and relatives to the production. Which of the following techni=ues would most likely advance this strategy of referrals and repeat business? a. relationship marketing b. empowerment c. a sales orientation d. authority to delegate
ANS: A
#elationship marketing is a strategy that entails forging long+term partnerships with customers.
1**. "he circusDs goal of redesigning the circus e;perience is being completed through the
coordination of many marketing activities2 such as value pricing2 a product that includes e;citing performances2 tent venue locations2 and promotion. What do these activities make up for the circuses? a. opportunity analysis b. value of marketing c. marketing mi; d. target market
ANS: ,
/arketing mi; elements include product2 place2 promotion2 and price.

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1+&6
,hapter 1 9 An 'verview of /arketing TRUE/FAL E 1. /arketing can be defined as selling products. ANS: %
/arketing has two facets. %irst2 it is a philosophy2 an attitude2 a perspective2 or a management orientation that stresses customer satisfaction. Second2 marketing is an organi7ation function and a set of processes used to implement this philosophy.
!"S: 1 #$%: 6 '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy (0/: #emember
1. /arketing is the activity2 set of institutions2 and processes for creating2 communicating2
delivering2 and e;changing offerings that have value for customers2 clients2 partners2 and society at large.
ANS: " !"S: 1 #$%: & "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy '(): *1+1 (0/: #emember
&. An e;change cannot take place unless each party in the e;change has something that the other
party values.
ANS: " !"S: 1 #$%: &+6 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy '(): *1+1 (0/: 5igher 'rder
6. Sara 0ee @ndustries spent considerable money and time developing a crustless bread. !rior to
the introduction2 the company had not conducted market research among its customers2 but it was confident that its science and technology department had produced a successful new product. (ased on this e;ample2 Sara 0ee is a good e;ample of a production+oriented company.
ANS: " !"S: 1 #$%: 6 "'!: AA,S( Analytic- "(.$ /odel #esearch '(): *1+1 (0/: 5igher 'rder
:. World ,hampionship Wrestling 3W,W42 a one+time competitor of the World Wrestling
%ederation 3now known as World Wrestling $ntertainment42 failed primarily because it set up its matches according to what its wrestlers wanted to do rather than what its fans wanted to see. W,W had a market orientation.
ANS: %
A production orientation would be a more appropriate description for a firm that does not research consumer needs and wants but rather focuses on the internal capabilities of the firm.
!"S: 1 #$%: 6 '(): *1+1 "'!: AA,S( Analytic- "(.$ /odel Strategy (0/: 5igher 'rder
<. @n the early 1C1*s2 %ord famously promised its customers any colour vehicle they wanted2 Ias
long as it was black.J %ordDs management assumed anyone buying a car would accept the colour black2 so it made products affordable by offering only one variety in large =uantities. %ord is an e;ample of a market+oriented firm.
,opyright 8 1*1& Nelson $ducation 0td. 1+&:
,hapter 1 9 An 'verview of /arketing ANS: %
(y offering one variety of colour2 not offering choices in =uantity2 and not segmenting the market2 %ord e;emplified a production+oriented firm.
!"S: 1 #$%: 6+: '(): *1+& "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer (0/: 5igher 'rder
?. While most marketing organi7ations rely on various forms of promotion to succeed2 sales+
oriented organi7ations make the most effective use of their entire marketing mi;.
ANS: %
Sales+oriented firms usually rely more heavily on sales activities alone than do market+ oriented firms.
!"S: 1 #$%: : '(): *1+& "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer- "(.$ /odel !roduct (0/: 5igher 'rder A. "he marketing concept states that the social and economic Bustification for an organi7ationDs
e;istence is the satisfaction of customersD wants and needs2 while meeting organi7ational obBectives.
ANS: " !"S: 1 #$%: <+A "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+1 (0/: #emember
C. "he ultimate goal of most market+oriented firms is profitability2 which results from satisfying
the wants and needs of its consumers.

ANS: " !"S: 1 #$%: <+A "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+& (0/: 5igher 'rder
1*. Salespeople who work for market+oriented organi7ations are generally perceived by their
customers to be order takers.

ANS: %
Salespeople who work for market+oriented organi7ations strive to be perceived by their customers to be problem solvers.
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,hapter 1 9 An 'verview of /arketing 11. "he societal marketing concept considers societyDs long+term best interests2 along with the
satisfaction of customersD wants and needs.

ANS: " !"S: 1 #$%: <+A "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+1 (0/: #emember
11. (oth production and sales orientations are focused inward on the organi7ationDs needs. ANS: " !"S: 1 #$%: <+A "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy '(): *1+& (0/: 5igher 'rder
1&. ,ustomer value is the relationship between company profits and company costs. ANS: %
,ustomer value is the relationship between benefits and the sacrifice necessary to obtain those benefits.
!"S: 1 #$%: ? '(): *1+& "'!: AA,S( #eflective "hinking- "(.$ /odel !ricing (0/: #emember
16. %irms try to achieve customer satisfaction and value by ensuring customer e;pectations are
met or e;ceeded.
ANS: " !"S: 1 #$%: ? "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer 1:. & '(): *1+& (0/: 5igher 'rder
Systems is a company that uses computers to generate new product prototypes. @t has generated loyal business clients by providing the best customer support in the industry. "he company also provides direct sales consultations that give its salespeople intimate knowledge about e;actly what its customers want. "his partnership between & Systems and its customers would be considered relationship marketing.
ANS: " !"S: 1 #$%: A "'!: AA,S( Analytic- "(.$ /odel !roduct '(): *1+& (0/: 5igher 'rder
1<. 'nly a firmDs salespeople need to be customer+oriented. ANS: %
All employees need to be customer+oriented because in the customerDs eyes2 the employee 3regardless of the position held in the organi7ation4 is the firm and may be the only firm representative the customer ever sees.
1?. #etailers who give their sales clerks the authority to handle customer complaints without
having to get approval from a supervisor are using empowerment.

ANS: " !"S: 1 #$%: A+C "'!: AA,S( #eflective "hinking- "(.$ /odel ,ustomer '(): *1+& (0/: 5igher 'rder
1+&?
,hapter 1 9 An 'verview of /arketing 1A. /arketing is a Bob that should be handled by marketers. !eople in management2 accounting2
and finance should focus on their own specialties.

ANS: %
!eople in all business areas2 regardless of speciali7ation or responsibility2 should be familiar with the fundamentals of marketing.
!"S: 1 #$%: 11 '(): *1+6 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy (0/: 5igher 'rder
1C. Appro;imately &* percent of the civilian workforce performs marketing activities. ANS: "
(etween one+=uarter and one+third of the civilian workforce performs marketing activities.
!"S: 1 #$%: 11 '(): *1+6 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy E A! 1. What is the definition of marketing? ANS: (0/: #emember
I/arketing is the activity2 set of institutions2 and processes for creating2 communicating2 delivering2 and e;changing offerings that have value for customers2 clients2 partners2 and society at large.J
!"S: 1 #$%: & '(): *1+1 "'!: AA,S( Analytic- "(.$ /odel Strategy 1. $;change is the key concept in the definition of marketing. What is the concept of e;change?
What are the five conditions of e;change that must be satisfied for e;change to occur?
ANS:
"he concept of e;change simply means that people give up something in order to receive something that they would rather have. /oney2 goods2 or services may be the medium of e;change. "he five conditions of e;change are 1. 1. &. 6. :. "here must be at least two parties. $ach party has something that might be of value to the other party. $ach party is capable of communication and delivery. $ach party is free to accept or reBect the e;change offer. $ach party believes it is appropriate or desirable to deal with the other party.
!"S: 1 #$%: &+6 '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy
1+&A
,hapter 1 9 An 'verview of /arketing &. "here are five conditions that must be satisfied for an e;change to take place. 5owever2 even
if all of these conditions are met2 e;change may not necessarily take place. Five an e;ample of a situation in which all conditions are met2 but e;change does not take place. ,an marketing occur2 even if an e;change does not take place? Why or why not?
ANS:
/any selling situations satisfy all five conditions for e;change2 but unless a purchase or trade actually takes place2 e;change does not occur. "he five conditions are necessary but not sufficient for final e;change. "he te;t provides the e;ample of advertising a used auto in the classified ads. /arketing can occur even if an e;change does not take place. /any of the activities of marketing 3product development2 planning2 promotion2 pricing2 distribution2 and so on4 can take place without a final e;change.
!"S: 1 #$%: &+6 '(): *1+1 "'!: AA,S( Analytic- AA,S( #eflective "hinking- "(.$ /odel Strategy 6. $;plain the two facets of marketing. ANS:
/arketing has two facets. %irst2 it is a philosophy2 an attitude2 a perspective2 or a management orientation that stresses customer satisfaction. Second2 marketing is an organi7ation function and a set of processes used to implement this philosophy. "his is the marketing process.
!"S: 1 #$%: 6 '(): *1+1 "'!: AA,S( Analytic- "(.$ /odel Strategy :. @s the following statement true? IA production orientation is always harmful to relationship
marketing.J $;plain your answer.

ANS:
A company with a production orientation concentrates on what it can do bestGits internal capabilities. Sometimes what the company produces is e;actly what the customer wants. @t is possible for a company to engage in relationship marketing 3a strategy that entails forging long+term partnerships with customers4 and still have a production orientation.
!"S: 1 #$%: 6 - A '(): *1+1 - *1+& "'!: AA,S( Analytic- "(.$ /odel !roduct
1+&C
,hapter 1 9 An 'verview of /arketing <. @f a firm has a production orientation2 what types of =uestions does management ask after
assessing its resources? 5ow would these =uestions differ for a service organi7ation?
ANS:
With a production orientation2 management focuses on the internal capabilities of the firm. /anagement might ask2 IWhat can we do best?J2 IWhat can engineering design?J2 and>or IWhat is economical and easy to produce with our e=uipment?J /anagers of a service organi7ation might ask2 IWhat services are most convenient for the firm to offer?J and>or IWhere do our talents lie?J
!"S: 1 #$%: 6 '(): *1+1 "'!: AA,S( Analytic- "(.$ /odel !roduct ?. %our competing philosophies strongly influence the role of marketing and marketing activities
within an organi7ation. Name and briefly describe each of these four philosophies.
ANS:
Production orientation: "his orientation focuses firms on their internal production capabilities rather than the desires and needs of the marketplace. Sales orientation: "his orientation assumes that buyers will purchase more of any item if aggressive selling techni=ues are used. Again2 this orientation does not address the needs and wants of the marketplace. Market orientation: "his orientation is the foundation of contemporary marketing philosophy. @t recogni7es that a sale is dependent on the customerDs decision to purchase a product and provides increased responsiveness to customer needs and wants. "o market+ oriented firms2 marketing means building relationships with customers. Societal orientation: "his orientation refines the marketing orientation by stating that the social and economic Bustification for an organi7ationDs e;istence is the satisfaction of customer wants and needs while meeting the organi7ationDs obBectives and preserving or enhancing both individualsD and societyDs long+term best interests.
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1+6*
,hapter 1 9 An 'verview of /arketing A. An entrepreneur has set up a company to manufacture and market F!S systems for hunters.
5e has decided a sales orientation would best suit his new company. What are important considerations for this firm when it adopts this orientation? What are potential pitfalls of this orientation the owner needs to understand?
ANS:
"he most important component for a sales orientation is an aggressive sales force. "he sales force can push intermediaries to carry products2 or push consumers to purchase. %or the entrepreneur in =uestion2 this is important2 as hunters rarely buy F!S e=uipment directly from the manufacturer. @nstead2 F!S e=uipment is offered through specialty resellers. An aggressive sales force could help the entrepreneur sell his product in more outlets. 5owever2 despite a high+=uality sales force2 even aggressive salespeople cannot convince people to buy goods and services that are neither wanted nor needed.
!"S: 1 #$%: : '(): *1+1 "'!: AA,S( Analytic- AA,S( #eflective "hinking- "(.$ /odel Strategy C. What is the marketing concept? According to the marketing concept2 what determines if a sale
will actually occur?

ANS:
"he marketing concept is a simple and intuitively appealing philosophy. @t states that the social and economic Bustification for an organi7ationDs e;istence is the satisfaction of customer wants and needs while meeting organi7ational obBectives. @t is based on an understanding that a sale does not depend on an aggressive sales force but rather on a customerDs decision to purchase a product.
!"S: 1 #$%: <+A '(): *1+1 "'!: AA,S( Analytic- "(.$ /odel Strategy
1+61
,hapter 1 9 An 'verview of /arketing 1*. What is the philosophy of the marketing concept and market orientation? What three key areas
are involved in the implementation of the marketing concept and a market orientation?
ANS:
"he philosophy of the marketing concept states that the social and economic Bustification for an organi7ationDs e;istence is the satisfaction of customer wants and needs while meeting organi7ational obBectives. /arket orientation re=uires top management leadership2 a customer focus2 competitive intelligence2 and interfunctional coordination to meet customer wants and needs and deliver superior value. @t also entails establishing and maintaining mutually rewarding relationships with customers. "he marketing concept and market orientation involve P focusing on consumer wants so the organi7ation can distinguish its product3s4 from competitorsD offerings. P integrating all the organi7ationDs activities2 including production2 to satisfy these wants. P achieving long+term organi7ation goals by satisfying customer wants and needs legally and responsibly.
!"S: 1 #$%: :+< '(): *1+1 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy 11. A market+oriented organi7ation may choose not to deliver the benefits sought by customers
because these benefits are not in the best interests of the individual or society. "his is termed the societal orientation. What does this concept mean in terms of organi7ational Bustification? 0ist three current issues where the societal orientation concept may need to be applied.
ANS:
"he societal orientation refines the market orientation by stating that the social and economic Bustification for an organi7ationDs e;istence is the satisfaction of customer wants and needs while meeting the organi7ationDs obBectives and preserving or enhancing both the individualDs and societyDs long+term best interests. Societal issues could include environmental protection2 smoking in public places2 promotion of high+sugar content foods to children2 seat belt laws2 alcohol marketing2 gun sales2 and purchasing drugs that have not been approved by the government2 and others.
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1+61
,hapter 1 9 An 'verview of /arketing 11.
escribe a real company that has a societal marketing orientation.

ANS:
StudentsD answers to this =uestion will vary depending upon what commercials2 advertisements2 and publicity they have been e;posed to. All should select a company that e;ists not only to satisfy customersD wants and needs and meet organi7ational obBectives2 but also preserve or enhance individualsD or societyDs long+term best interests.
!"S: 1 #$%: < '(): *1+1 "'!: AA,S( Analytic- "(.$ /odel Strategy 1&.
iscuss the differences between sales and market orientations using the following five characteristics as guidelines: 314 the organi7ationDs focus2 314 the business the organi7ation is in2 3&4 the people to whom the product is directed2 364 the organi7ationDs primary goal2 and 3:4 the tools used to achieve that goal.
ANS:
Organizations focus: With a sales orientation2 the firmDs focus is inward upon the firmDs own needs. With a market orientation2 the focus is outward on the wants and preferences of customers. @n particular2 market+oriented firms create customer value2 maintain customer satisfaction2 and build long+term relationships. Business: A firm with a sales orientation is in the business of selling goods and services. A firm with a market orientation is in the business of satisfying consumer wants and needs. Customers: A sales orientation directs the firmDs output at everybody2 while a market orientation directs goods toward specific groups of people. Primary goal: "he primary goal of a firm with a sales orientation is to make profit through ma;imi7ing sales volume. "he primary goal of a firm with a market orientation is to seek profit through customer satisfaction. Tools for goal ac ie!ement: A sales orientation seeks to achieve goals primarily through intensive promotion. A market orientation achieves goals through coordinated use of a set of marketing activities. See #eview 0earning 'utcome &.
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1+6&
,hapter 1 9 An 'verview of /arketing 16. What is customer value? 5ow can marketers make sure customers perceive their
companies>products as sources of value?

ANS:
,ustomer value is the relationship between benefits and the sacrifice necessary to obtain those benefits. /arketers who want to be perceived by their customers as offering value can 314 offer products that perform as they are e;pected to2 314 earn trust2 3&4 avoid unrealistic pricing2 and 364 give the buyer facts.
!"S: 1 #$%: ? '(): *1+& "'!: AA,S( Analytic- "(.$ /odel ,ustomer 1:.
efining the companyDs business in terms of the benefits customers seek2 instead of in terms of goods and services2 has three important advantages. 0ist them.
ANS:
314 @t ensures that the firm keeps focusing on customers and avoids becoming preoccupied with goods2 services2 or the organi7ationDs internal needs. 314 @t encourages innovation and creativity by reminding people there are many different ways to satisfy customer wants. 3&4 @t stimulates an awareness of changes in customer desires and preferences so product offerings are more likely to remain relevant.
!"S: 1 #$%: C+1* '(): *1+& "'!: AA,S( Analytic- "(.$ /odel !roduct- "(.$ /odel ,ustomer 1<. "here are several important reasons to study marketing. Name three of these reasons. ANS:
1. 1. &. 6.
/arketing plays an important role in society. /arketing is important to businesses. /arketing offers outstanding career opportunities. /arketing affects your life every day.
!"S: 1 #$%: 11+11 '(): *1+6 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy 1?. 5ow is marketing important to business? ANS:
/arketing contributes directly to the achievement of business obBectives2 including survival2 profits2 and growth. /arketing is concerned with assessing the wants and satisfactions of customers2 designing and managing product offerings2 determining prices2 developing distribution strategies2 and communicating with customers. "hese activities are vital to business organi7ations. A fundamental understanding of marketing is important to all businesspeople so that an organi7ation can operate cohesively.
!"S: 1 #$%: 11 '(): *1+6 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy
1+66
,hapter 1 9 An 'verview of /arketing 1A. What types of marketing careers are available? What is the current percentage of marketing
employees in the civilian workforce? What is the future forecast for marketing employment?
ANS:
'ne+=uarter to one+third of the civilian workforce performs marketing activities in areas such as professional selling2 research2 advertising2 retail buying2 distribution management2 product management and development2 and wholesaling. /arketing career opportunities e;ist in both business and non+business organi7ations. emand for marketing+educated personnel is growing. /arketing employment is proBected to grow at a faster rate than that of all Bobs. Additionally2 marketing is a crucial part of every companyDs success.
!"S: 1 #$%: 11 '(): *1+6 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy- "(.$ /odel #esearch- "(.$ /odel ,reativity 1C. 5ow does marketing affect your everyday life? 5ow will the study of marketing enable you to
be a better consumer?
ANS:
$very person participates in the marketing process as a consumer of goods and services. (y developing an understanding of marketing2 one can better understand the buying process2 negotiate more effectively with sellers2 and demand corrective action when products do not meet performance standards.
!"S: 1 #$%: 11 '(): *1+6 "'!: AA,S( #eflective "hinking- "(.$ /odel Strategy- "(.$ /odel ,ustomer- "(.$ /odel #esearch
1+6:

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Chapter 1An Overview of Marketing

,opyright 8 1*1& Nelson $ducation 0td.

,opyright 8 1*1& Nelson $ducation 0td.

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"he sales orientation assumes aggressive selling is needed to increase demand.

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"he sales orientation relies on aggressive sales techni=ues to fuel business.

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See #eview 0earning 'utcome &.

,anon has a sales orientation.

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)ac=ues "orres ,hocolate has a market orientation.

,hapter 1 9 An 'verview of /arketing a. b. c. d.

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/arket+oriented firms are focused outward toward their customers.

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e=uipment within a period of three years after purchase?

,hapter 1 9 An 'verview of /arketing a. b. c. d.

management empowerment management9customer synergy customer satisfaction transactional marketing

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,hapter 1 9 An 'verview of /arketing <?.

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,ustomer+oriented personnel strengthen the positive image of an organi7ation.

0eading marketers recogni7e the role of employee training in customer service.

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approval from their immediate supervisors.

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$nhanced employee performance leads to improved customer satisfaction.

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transactions needed to provide goods and services.

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"he use of marketing allows businesses to achieve this obBective.

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A market+oriented philosophy is based on consumersD wants and needs.

#elationship marketing seeks to forge long+term partnerships with customers.

elegation of authority to employees is empowerment.

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,hapter 1 9 An 'verview of /arketing

probably had which type of orientation? a. sales b. market c. production d. societal

A market+oriented philosophy is based on consumersD wants and needs.

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/arketing mi; elements include product2 place2 promotion2 and price.

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:. World ,hampionship Wrestling 3W,W42 a one+time competitor of the World Wrestling

,hapter 1 9 An 'verview of /arketing ANS: %

the wants and needs of its consumers.

customers to be order takers.

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satisfaction of customersD wants and needs.

1<. 'nly a firmDs salespeople need to be customer+oriented. ANS: %

having to get approval from a supervisor are using empowerment.

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and finance should focus on their own specialties.