Marketing 4th Canadian Edition By Grewal

To Purchase this Complete Test Bank with Answers Click the link Below

https://tbzuiqe.com/product/marketing-4th-canadian-edition-by-grewal-test-bank/

If face any problem or Further information contact us At tbzuiqe@gmail.com

Sample Test

Chapter 03

Analyzing the Marketing Environment

Multiple Choice Questions

1. Which of the following is the goal of value-based marketing?
A.satisfy customers by offering the best price in the market
B. satisfy employees by offering the best benefits
C. satisfy investors by offering the best ROI
D. offer greater value to consumers than competitors
E. differentiate product offerings

Customers are at the heart of all marketing programs and efforts; value-based marketing aims to provide greater value to consumers than competitors offer.

Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 03-01 Outline how the factors in a firm’s microenvironment influence its marketing strategy.
Topic: 03-01 A Marketing Environment Analysis Framework

2. Which of the following is NOT a microenvironmental factor?
A.company
B. corporate partners
C. consumers
D. competition
E. capabilities

Customers are not considered a microenvironmental factor.

Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Moderate
Learning Objective: 03-01 Outline how the factors in a firm’s microenvironment influence its marketing strategy.
Topic: 03-02 Microenvironmental Factors

3. Walmart’s effective distribution network is at the heart of its success. This describes which factor of a Walmart consumers’ microenvironment?
A.Competition
B. partners
C. place
D. company capabilities
E. culture

The first factor in the firm’s microenvironment is the firm and its capabilities. Effective distribution network is an example.

Accessibility: Keyboard Navigation
Blooms: Understand
Difficulty: Moderate
Learning Objective: 03-01 Outline how the factors in a firm’s microenvironment influence its marketing strategy.
Topic: 03-03 Company Capabilities

4. When firms collect and synthesize information about their position with respect to their rivals, it is called:
A.bid rigging.
B. exclusive dealing.
C. bait-and-switch.
D. generational cohort.
E. competitive intelligence.

Competitive intelligence (CI) is used by firms to collect and synthesize information about their position with respect to their rivals; it enables companies to anticipate changes in the marketplace rather than merely react to them.

5. A car manufacturing company is keenly monitoring the announced cuts or increases in the rival companies’ production volume, sales, and sales incentives. It uses this information to plan its own marketing, pricing, and production strategies. This is an example of:
A.bid rigging.
B. unethical behaviour
C. bait-and-switch.
D. corporate partners
E. competitive intelligence.

Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Moderate
Learning Objective: 03-01 Outline how the factors in a firm’s microenvironment influence its marketing strategy.
Topic: 03-04 Competition

6. Marriot International sends employees to stay at its rival competitor, Hilton Hotels & Resorts, to monitor new services and experiences Hilton offers to the customers. This is an example of:
A.company capabilities
B. monitoring
C. corporate partners
D. competition intelligence
E. unethical behaviour

7. Jordan Inc., an online retail firm, wanted to determine the development strategy of its rival company. Tapping into some online discussion groups, Jordan came to know that its rival had posted 20 job openings online. This move was indicative of the rival company’s development strategy. Which of the following is being used by Jordan to gather information about its rival firm’s strategy?
A.bid rigging
B. unethical behaviour
C. bait-and-switch
D. corporate partners
E. competitive intelligence

Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Difficult
Learning Objective: 03-01 Outline how the factors in a firm’s microenvironment influence its marketing strategy.
Topic: 03-04 Competition

8. Which of the following is NOT a macroenvironmental factor?
A.competitors’ practices
B. political environment
C. economic situation
D. technological advances
E. social trends

Macroenvironmental factors (CDSTEP) are: culture, demographics, technological advances, social trends, economic situation, and political/legal environment.

Accessibility: Keyboard Navigation
Blooms: Understand
Difficulty: Moderate
Learning Objective: 03-02 Identify the factors in a firm’s macroenvironment and explain how they influence the overall marketing strategy.
Topic: 03-06 Macroenvironmental Factors

9. Which of the following refers to the visible nuances such as artifacts, behaviour, dress, symbols, physical settings, ceremonies, language differences, colours and tastes, and food preferences?
A.Generational cohort
B. Country culture
C. Demographics
D. Political environment
E. Competitive intelligence

The visible nuances of a country’s culture, such as artifacts, behaviour, dress, symbols, physical settings, ceremonies, language differences, colours and tastes, and food preferences, are easy to spot. But the subtle aspects of culture generally are trickier to identify and navigate.

Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 03-02 Identify the factors in a firm’s macroenvironment and explain how they influence the overall marketing strategy.
Topic: 03-07 Culture

10. Which of the following refers to the way people in a particular country react to different cultural rituals in accordance with their place of residence?
A.Competitive intelligence
B. Country culture
C. Demographics
D. Generational cohort
E. Regional subculture

The region in which people live in a particular country affects the way they react to different cultural rituals, or even how they refer to a particular product category. This concept is termed “regional subculture.”

11. Canadian national food includes poutine and butter tarts. Canada is the world’s largest producer of maple syrup. The music of Canada reflects the many influences that have shaped the country. The official symbols of Canada include the maple leaf and the beaver. Which of the following best exemplifies the given information?
A.Competitive intelligence
B. Country culture
C. Generational cohort
D. Demographics
E. Regional subculture

Country culture includes easy-to-spot visible nuances that are particular to a country, such as dress, symbols, ceremonies, language, colours, and food preferences, and more subtle aspects, which are trickier to identify.

Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Difficult
Learning Objective: 03-02 Identify the factors in a firm’s macroenvironment and explain how they influence the overall marketing strategy.
Topic: 03-07 Culture

12. Quebec women have a higher demand for high quality clothes compared to other parts of Canada. Which of the following best related to this statement?
A.country culture
B. demographics
C. regional subculture
D. generational cohort
E. social trends

Regional subculture refers to the region in which people live affects the way they react to different cultural rituals.

13. The fact that Canada is a nation with two official languages and that humour is an integral part of its arts scene is an example of:
A.regional subculture.
B. country culture.
C. generational cohort.
D. competitive intelligence.
E. demographics.

14. Mary, Jane, and Brad were all born the year after World War II. Leisure time is a high priority for them. They have an obsession with maintaining their youth and love rock ‘n’ roll. They belong to the generational cohort of:
A.baby boomers.
B. millenials.
C. Generation X.
D. Generation Y.

After World War II, the birth rate in Canada rose sharply, resulting in a group known as the baby boomers. They are individualistic. Their leisure time is highly prioritized. They maintain their youth and love rock ‘n’ roll.

15. Morgan Inc.’s clothing line has different divisions for children, tweens, and senior citizens. If Morgan bases its production requirements primarily on the age group of its target audience, its market segmentation is most likely to be relying on:
A.political environment.
B. social trends.
C. demographics.
D. technological advances.
E. culture.

Demographics indicate the characteristics of human populations and segments, especially those used to identify consumer markets, such as age, gender, income, race, ethnicity, and education.

16. Misha and Jenny are both 11 years old and spend their money mainly on food and drinks, digital music players, cellphones, computers, and clothing. They are likely to belong to which cohort?
A.Tweens
B. Generation Y
C. Generation X
D. Baby boomers
E. Seniors

Tweens—not quite teenagers but not young children either—sit in between. In Canada, tweens spend their money mainly on food and drinks, electronics (gaming consoles and games, digital music players, cellphones, and computers) and clothing.

17. Which of the following refers to a group of people of the same generation who typically have similar purchase behaviours because they have shared experiences and are in the same stage of life?
A.Generational cohort
B. Country culture
C. Competitive intelligence
D. Greener consumers
E. Ethnicity

A group of people of the same generation, generational cohorts, have similar purchase behaviours because they have shared experiences and are in the same stage of life. For instance, baby boomers, made up of people born between 1946 and 1965, and Gen Xers, people born between 1966 and 1971, both gravitate toward products and services that foster a casual lifestyle; however, they tend to do so for different reasons.

18. Which of the following is true of the generational cohort of tweens?
A.Tweens include people between the ages of 13 and 32.
B. Tweens include people born after World War II who are between the ages of 48 and 66.
C. Tweens include people aged 65 and older.
D. Tweens include people aged 9 to 12 years.
E. Tweens include people between the ages of 36 and 47.

Tweens—not quite teenagers but not young children either—sit in between. Marketers feel the tween effect in many areas, but particularly in the cellphone market.

19. Which of the following is true of Generation X?
A.They are less likely to believe in advertising claims or what salespeople tell them.
B. They are more interested in status products than older generations.
C. They are more likely to enjoy greater prosperity than their parents.
D. They have little knowledge about products in the market.
E. They are more interested in shopping than their parents.

Gen Xers possess considerable spending power because they tend to wait to get married and buy houses later in life. However, they are unlikely to enjoy greater prosperity than their parents. They’re much less interested in shopping than their parents and are far more cynical, which tends to make them astute consumers. They demand convenience and tend to be less likely to believe advertising claims or what salespeople tell them.

20. Bill is 40 years old. He is much less interested in status products than his parents and is less likely to believe in advertising claims. He shares his characteristics with:
A.baby boomers.
B. Generation Y.
C. Generation X.
D. tweens.
E. seniors.

Gen Xers possess considerable spending power because they tend to wait to get married and buy houses later in life. They demand convenience and tend to be less likely to believe advertising claims or what salespeople tell them. They are also much less interested in status products than older generations, not because they can’t afford luxury brands but because they just don’t see the point.

Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Moderate
Learning Objective: 03-02 Identify the factors in a firm’s macroenvironment and explain how they influence the overall marketing strategy.
Topic: 03-08 Demographics

21. Jack is a 60-year-old resident of Texas. He is self-reliant and individualistic. While making decisions about purchasing products, he lays more emphasis on quality than price. He shares his characteristics with:
A.baby boomers.
B. Generation Y.
C. Generation X.
D. tweens.
E. seniors.

Baby boomers are individualistic. Retailers note that their older customers (baby boomers), even those with moderate incomes, are more focused on quality than price.

22. Which of the following statements is NOT true of Generation Y?
A.They belong to the generational cohort of people born between 1972 and 1992
B. They are the biggest cohort since the original postwar baby boom.
C. They grew up in a more brand-conscious era than their parents.
D. They value convenience and tend to be less likely to believe advertising claims.
E. They love digital electronics.

Generation Y, also called millennials or the “echo boom” generation, represent just over 9 million Canadians, or about 27 percent of the population. This group also varies the most in age, ranging from people in their 20s to people in their 40s who have started their own families.
Gen Xers demand convenience and tend to be less likely to believe ad claims.

Accessibility: Keyboard Navigation
Blooms: Understand
Difficulty: Difficult
Learning Objective: 03-02 Identify the factors in a firm’s macroenvironment and explain how they influence the overall marketing strategy.
Topic: 03-08 Demographics

23. Which of the following statements is true of Generation X?
A.They belong to the generational cohort of people between the ages of 13 and 32 and the biggest cohort since the original postwar baby boom.
B. They belong to the generational cohort of people born after World War II who are between the ages of 48 and 66.
C. They belong to the generational cohort of people aged 65 and older.
D. They belong to the generational cohort of people who are not quite teenagers but are not young children either.
E. They belong to the generational cohort of people born between 1966 and 1971.

Generation X includes people born between 1966 and 1971. This group represents more than 2.8 million Canadians, or about 8 percent of the Canadian population.

24. Which of the following generational cohorts is also referred to as the echo boom generation?
A.Tweens
B. Generation Y
C. Generation X
D. Baby boomers
E. Seniors

Generation Y, also called millennials or the “echo boom” generation, represent just over 9 million Canadians, or about 27 percent of the population.

Accessibility: Keyboard Navigation
Blooms: Understand
Difficulty: Easy
Learning Objective: 03-02 Identify the factors in a firm’s macroenvironment and explain how they influence the overall marketing strategy.
Topic: 03-08 Demographics

25. Which of the following generational cohorts is also referred to as the first generation of latchkey kids?
A.Tweens
B. Generation Y
C. Generation X
D. Baby boomers
E. Seniors

Unlike their baby boomer parents, Gen X is the first generation of latchkey kids (those who grew up in homes in which both parents worked), and 50 percent of them have divorced parents.

26. Latchkey kids are those children who:
A.were left orphaned after the death of their biological parents.
B. grew up in foster homes because of the inability of their parents to take care of them.
C. grew up in homes with a stepmother or a stepfather.
D. grew up in homes in which both parents worked.
E. grew up in single-parent homes.

Unlike their baby boomer parents, Gen X is the first generation of latchkey kids (those who grew up in homes in which both parents worked), and 50 percent of them have divorced parents.

27. Venus and Jake have been married for three years. Venus is 30 years old, and Jake is 28. They are Internet and technology savvy. They use the Internet at work for personal reasons and expect a healthy option at fast-food restaurants. They are likely to belong to which cohort?
A.Tweens
B. Generation Y
C. Generation X
D. Baby boomers
E. Seniors

Regardless of where they live, members of Generation Y watch an hour less TV than an average household, use the Internet at work for personal reasons, and expect a healthy option at fast-food restaurants. Gen Yers are Internet and technology savvy and love digital electronics such as cellphones, digital music players, digital cameras, and video games.

28. Megan is 40 years old and heads an advertising firm. She grew up in a home in which both parents worked. Although Megan possesses considerable spending power, she is much less interested in shopping than her parents and is far more cynical, which tends to make her an astute consumer. Megan takes a long vacation every summer and travels to different parts of the world. She is likely to belong to which cohort?
A.Tweens
B. Generation Y
C. Generation X
D. Baby boomers
E. Seniors

Generation X is the first generation of latchkey kids (those who grew up in homes in which both parents worked). Gen Xers possesses considerable spending power because they tend to wait to get married and buy houses later in life. However, they are unlikely to enjoy greater prosperity than their parents. They’re much less interested in shopping than their parents and are far more cynical, which tends to make them astute consumers.

29. Which of the following statements is true of baby boomers?
A.They belong to the generational cohort of people born between 1972 and 1992.
B. They belong to the generational cohort of people born between 1946 and 1965.
C. They belong to the generational cohort consisting of people aged 65 and older.
D. They belong to the generational cohort of people who are not quite teenagers but are not young children either.
E. They belong to the generational cohort of people born between 1966 and 1971.

After World War II, the birth rate in Canada rose sharply, resulting in a group known as the baby boomers, who were born between 1946 and 1965. They are the largest cohort of Canadians, representing 30 percent of the population.

30. Joe is 65 years old. He is highly individualistic and invests in health and wellness products. He loves to indulge in products and services that help him maintain his youth. Joe belongs to the category of:
A.Gen X.
B. Gen Y.
C. tweens.
D. baby boomers.
E. seniors.

After World War II, the birth rate in Canada rose sharply, resulting in a group known as the baby boomers, who were born between 1946 and 1965. Baby boomers are individualistic. They have an obsession with maintaining their youth.

31. Which of the following statements is true of seniors?
A.They belong to the generational cohort of people between the ages of 13 and 32 and the biggest cohort since the original postwar baby boom.
B. They belong to the generational cohort of people born after World War II who are between the ages of 48 and 56.
C. They belong to the generational cohort consisting of people aged 65 and older.
D. They belong to the generational cohort of people who are not quite teenagers but are not young children either.
E. They belong to the generational cohort of people between the ages of 36 and 47.

Seniors are over the age of 65 and make up Canada’s fastest-growing group. Between 2006 and 2011, the number of seniors in Canada grew from 4.3 million to nearly 5 million.

32. Which of the following is a characteristic of people belonging to the baby boomer generation?
A.They are individualistic.
B. They are workaholics.
C. They abhor youth, which they equate with immaturity.
D. They love pop.
E. They are gutted by a feeling of economic and psychological insecurity.

After World War II, the birth rate in Canada rose sharply, resulting in a group known as the baby boomers, who were born between 1946 and 1965. They are individualistic.

33. Nate, born in 1960, is very individualistic. He ensures he has enough leisure time to pursue his interests. He is obsessed with maintaining his youth and loves rock ‘n’ roll. If these traits are typical of those of his generation, he is likely to belong to which cohort?
A.Tweens
B. Generation Y
C. Generation X
D. Baby boomers
E. Seniors

Baby boomers are individualistic and have an obsession with maintaining their youth. Leisure time is a high priority for them. They will always love rock ‘n’ roll.

34. Diana is 66 years old. While shopping for products, she prefers to buy recognizable brands and is extremely quality conscious. Diana also prefers to shop at convenient locations. Which of the following generational cohorts does she belong to?
A.Tweens
B. Generation Y
C. Generation X
D. Baby boomers
E. Seniors

Seniors are over the age of 65 and make up Canada’s fastest-growing group. They’re typically loyal and willing to spend but are extremely quality conscious and demand hassle-free shopping, particularly in terms of convenient locations.

35. Sue is offering home cleaning services and found out that WOM and referral work much better to promote her business than advertising. Which of the following generational cohorts is most likely the main target market?
A.Tweens
B. Generation Y
C. Generation X
D. Baby boomers
E. Seniors

Generation X demands convenience and tends to be less likely to believe advertising or salespeople promises. WOM advertising from people they know works better for this group.

36. Which of the following statements is true of upper-class consumers?
A.Their family income is usually between $20,000 and $30,000.
B. They rely on assistance to cover their basic needs.
C. They primarily perform clerical jobs.
D. They tend to be careful about their spending and are often value conscious.
E. Their spending patterns are not influenced by economic conditions.

Upper-class consumers are very affluent, and their spending patterns are not influenced by economic conditions.

37. Which of the following statements is true of middle-class consumers?
A.Their family income is usually between $20,000 and $30,000.
B. They rely on assistance to cover their basic needs.
C. They have very high discretionary incomes and tend to purchase luxury items.
D. They tend to be careful about their spending and are often value-conscious.
E. Their spending patterns are not influenced by economic conditions.

Middle-class families can afford a good life most of the time. They tend to be careful about their spending and are often value conscious.

38. Which of the following statements is true of working-class consumers?
A.Their family income is usually between $20,000 and $30,000.
B. They are more likely to be highly educated.
C. They are more likely to work in managerial and executive roles.
D. They have high discretionary incomes.
E. Their spending patterns are not influenced by economic conditions.

Working-class, or low-income families, earn between $20,000 and $30,000, barely sufficient income to cover their basic needs.

39. Which of the following statements is true of the income of Canadians?
A.Family income distribution in Canada is similar across its provinces.
B. Underclass Canadians are just above poverty.
C. The majority of the Canadians fall in the middle-class category.
D. The richest 20 percent of Canadians spend 5 or 6 times more than the poorest 20 percent of Canadians.
E. Most families experienced real income growth after 1980, and their health care costs, property taxes, and tuition bills have risen at a much slower rate than inflation.

According to a report by Statistics Canada, the richest 20 percent of Canadians spend 5 or 6 times more in every shopping category than the poorest 20 percent of Canadians.

40. Megan and John have been married for 10 years. Megan is the vice-president of a bank, and John is an investment banker. They enjoy a combined income of more than $100,000. Megan loves art. She buys paintings of renowned painters in auctions all over the world. Which of the following categories do they belong to?
A.Underclass consumers
B. Upper-class consumers
C. Working-class consumers
D. Middle-class consumers
E. Lower-class consumers

41. Jack is a teacher and his wife, Meg, works as an assistant in a research laboratory. They have a combined income of $68,000. They have a house on mortgage and take long vacations once every four years. They are value conscious. Which of the following categories do they belong to?
A.Underclass consumers
B. Upper-class consumers
C. Working-class consumers
D. Middle-class consumers
E. Lower-class consumers

Middle-class families earn between $30,000 and $70,000. They tend to be careful about their spending and are often value conscious.

42. Bruce is a part-time janitor. Maria washes dishes in a restaurant. They have a combined income of $30,000. They are barely able to make ends meet because they have three small children. Which of the following categories do they belong to?
A.Underclass consumers
B. Upper-class consumers
C. Working-class consumers
D. Middle-class consumers
E. Upper-middle-class consumers

Working-class, or low-income families, earn between $20,000 and $30,000, barely sufficient income to cover their basic needs.

43. Philip lives with his wife Emma and four children in a rented single-room apartment. They live below poverty and take aid of the social security provided by the government. Which of the following categories do they belong to?
A.Underclass consumers
B. Upper-class consumers
C. Working-class consumers
D. Middle-class consumers
E. Lower-class consumers

Canadians may be classified into distinct groups based on their income and other factors such as background, education, and occupation: upper class, middle class, working class (or low-income earners), and underclass (at or below poverty).

Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Easy
Learning Objective: 03-02 Identify the factors in a firm’s macroenvironment and explain how they influence the overall marketing strategy.
Topic: 03-08 Demographics

44. Which of the following statements is true of the effect of changing gender roles in society on marketers?
A.Absence of the role of father in commercials for children’s goods
B. Increase in advertisements involving single mothers
C. Gender neutrality in the positioning of products
D. Discouraging the trend of transcending gender boundaries
E. Portraying women as more competent than men

The shift in gender roles, attitude, and behaviour affects the way many firms design and promote their products and services. For example, more firms are careful about gender neutrality in positioning their products and, furthermore, attempt to transcend gender boundaries whenever they can.

45. Which of the following holds true for ethnic groups who have migrated to Canada?
A.Ethnic Canadians spend less than their white counterparts on big-ticket items such as cars, clothing, and home furnishings.
B. South Asian and Chinese immigrants are typically young, educated, and wealthy.
C. Currently, less than 2 percent of all visible minorities in Canada are under 14 years.
D. Migrated ethnic groups account for nearly 10 percent of Canada’s population growth.
E. Russians represent the fastest-growing ethnic group in Canada.

The two fastest-growing groups are the Chinese (from Hong Kong, mainland China, and Taiwan) and South Asians (from India, Pakistan, Sri Lanka, and Bangladesh). The groups of South Asians and Chinese are typically young, educated, and wealthy.

46. The two fastest-growing ethnic groups who have migrated to Canada are the:
A.Russians and the South Americans.
B. Europeans and the South Americans.
C. Arabs and the Africans.
D. Chinese and the South Asians.
E. Africans and the Europeans.

47. The fact that many of today’s commercials for children’s gear now include Dad interacting with the kids and being involved in purchase decisions reflects:
A.that men earn more money than women.
B. the increasing generational gap in Canadian households.
C. the importance that marketers are giving to changing gender roles.
D. that higher levels of education lead to better jobs and higher incomes.
E. the change in the gender composition of a country.

The days of commercials that show Mom alone with the kids are over. To reflect changing family roles, commercials for most children’s gear now include Dad interacting with the kids and being involved in purchase decisions.

48. Bill is part of a program that collects biodegradable material from domestic wastes. This material is collected by the municipality and used to make compost for gardening. Which of the following program best describes Bill’s activity?
A.Bait-and-switch
B. Green washing
C. Carbon footprint
D. Bid rigging
E. Green bin

A growing number of cities across Canada are introducing the “green bin” program that encourages consumers to recycle their food and yard waste to make compost for gardening. Initial results suggest that this program is hugely successful everywhere it has been introduced.

Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Moderate
Learning Objective: 03-03 Identify important social and natural trends that impact marketing decisions.
Topic: 03-12 Social and Natural Trends

49. A hotel introduces eco-rooms that have energy-efficient mini-bars, organic bed linen, and napkins made of recycled papers. They also advertise that their rooms are fitted with CFLs or LEDs to conserve energy. This is an example of:
A.green bin.
B. green washing.
C. green marketing.
D. bid rigging.
E. bait-and-switch.

Green marketing involves a strategic effort by firms to supply customers with environmentally friendly merchandise. Although this “green” trend is not new, it is growing.

Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Difficult
Learning Objective: 03-03 Identify important social and natural trends that impact marketing decisions.
Topic: 03-12 Social and Natural Trends

50. The strategic effort made by firms to supply customers with environmentally friendly merchandise is called:
A.green bin.
B. green washing.
C. green marketing.
D. bid rigging.
E. bait-and-switch.

Green marketing involves a strategic effort by firms to supply customers with environmentally friendly merchandise. Although this “green” trend is not new, it is growing.

Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 03-03 Identify important social and natural trends that impact marketing decisions.
Topic: 03-12 Social and Natural Trends

51. Which of the following programs encourages consumers to recycle their food and yard waste to make compost for gardening?
A.Bid rigging
B. Green washing
C. Carbon footprint
D. Bait-and-switch
E. Green bin

52. PlusLight, a torch manufacturing company, releases high-intensity torches at incredibly low prices. Within a year, it achieves market monopoly by driving away most of its competitors from business. Which of the following practices did PlusLight engage in?
A.Predatory pricing
B. Price fixing
C. Price discrimination
D. Bid rigging
E. Resale price maintenance

Pricing that is intended to drive competitors out of the market or keep competitors from entering the market, usually low prices, is termed predatory pricing. The Competition Act has laws to keep predatory pricing in check.

53. Which of the following trends has increased the difficulty that marketers face when they try to grab the attention of consumers?
A.Canadians have more time for leisure and to spend with family.
B. The attention of multitasking consumers is divided.
C. Consumers must choose what shows they want to watch from fewer programs.
D. Kids prefer to spend more time on physical sports than electronic gadgets.
E. Minority groups are getting more familiar with the English language.

Many consumers attempt to cope with their lack of leisure time by multitasking: watching TV or listening to music while talking on the telephone or doing homework. Their divided attention means they simply cannot focus as well on the advertisements that appear in those media.

Accessibility: Keyboard Navigation
Blooms: Understand
Difficulty: Moderate
Learning Objective: 03-03 Identify important social and natural trends that impact marketing decisions.
Topic: 03-12 Social and Natural Trends

54. Which of the following is used by retail firms to track an item from the moment it is manufactured, through the distribution system, to the retail store, and into the hands of the final consumer?
A.RuBee
B. Radio frequency identification device
C. Biometrics
D. Resonant inductive coupling
E. Supranet

Firms use the technology called RFID (radio frequency identification device) to track an item from the moment it is manufactured, through the distribution system, to the retail store, and into the hands of the final consumer. Because they are able to determine exactly how much of each product is at a given point in the supply chain, retailers can also communicate with their suppliers and collaboratively plan to meet their inventory needs.

55. Mekong Airlines uses special technology to reduce the number of lost bags and make it easier to reroute bags if passengers change their flight plans. Which of the following technologies does it use to track passenger bags?
A.Resonant inductive coupling
B. Radio frequency identification device
C. Biometrics
D. Electrodynamic induction
E. Supranet

Firms use the technology called RFID (radio frequency identification device) to track an item from the moment it was manufactured, through the distribution system, to the retail store, and into the hands of the final consumer.

56. The persistent increase in the prices of goods and services is called:
A.deflation.
B. predatory prices.
C. inflation.
D. recession.
E. bid rigging.

Inflation refers to the persistent increase in the prices of goods and services. Increasing prices cause the purchasing power of the dollar to decline; in other words, a dollar buys less than it used to.

57. When the value of the Canadian dollar increases by 20 percent against the major currencies in the previous quarter and drops by around 30 percent in the current quarter, it is referred to as:
A.deflation.
B. foreign currency fluctuation.
C. inflation.
D. recession.
E. shoe leather cost.

Foreign currency fluctuations refer to the changes in the value of a country’s currency relative to the currency of another country. Foreign currency fluctuations can influence consumer spending.

58. In Germany, in 1923, prices doubled every two days, and workers were paid twice a day so they could buy food and goods before prices rose again. The new payment system was in response to the:
A.deflation.
B. foreign currency fluctuation.
C. inflation.
D. recession.
E. shoe leather cost.

59. Suppose C $1.00 was worth US $0.809, and after nine months, the Canadian dollar increased to $1.50. This is an example of:
A.deflation.
B. foreign currency fluctuation.
C. inflation.
D. recession.
E. shoe leather cost.

Foreign currency fluctuations refer to the changes in the value of a country’s currency relative to the currency of another country. Foreign currency fluctuations can influence consumer spending. For instance, on January 21, 2007, C$1.00 was worth US$0.6179, the lowest exchange rate ever between these two currencies. In less than four months, the value of the Canadian dollar relative to the U.S. dollar increased to $0.907169—a 32 percent increase—and by September the Canadian dollar increased to $1.10.

60. A period of economic downturn when the economic growth of a country is negative for at least a couple of consecutive quarters is called:
A.deflation.
B. foreign currency fluctuation.
C. inflation.
D. recession.
E. shoe leather cost.

Recession is a period of economic downturn when the economic growth of the country is negative for at least two consecutive quarters. In a recession, the stock market declines sharply, unemployment increases, business and consumer confidence falls, and spending by both businesses and consumers is severely reduced.

61. Which of the following situations arises during a recession?
A.An increase in the stock market valuations
B. An increase in the rate of unemployment
C. An increase in business and consumer confidence
D. An increase in consumer spending
E. An increase in purchasing power

62. Which of the following is an impact of government regulations on marketers?
A.It drastically lessens the opportunity for marketers to sell more of their products.
B. It creates an uneven playing field for competition.
C. It contributes to the creation of legal irregularities in the market.
D. It increases the cost of compliance.
E. It promotes inflationary tendencies.

Regulation may help to create a level playing field for competition and set standards for marketers to follow. In other cases, regulation tends to increase the cost of compliance; compliance usually requires more paperwork, time, effort, and money and may cause delays when government approval is needed.

63. The pricing that is intended to drive competitors out of the market or keep competitors from entering the market by fixing very low prices is called:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

The pricing that is intended to drive competitors out of the market or keep competitors from entering the market by fixing very low prices is called predatory pricing.

64. A situation in which sellers collude to set prices in response to quotations for products is called:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

A situation in which sellers collude to set prices in response to bids or quotations for products is called bid rigging.

65. A situation in which incentives are offered to consumers to provide the names of other potential consumers is called:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

A situation in which incentives are offered to consumers to provide the names of other potential consumers is called referral selling.

66. A car sales showroom displays a basic car with a very low price tag. Once a customer is interested, the salesperson persuades him or her to buy a more expensive model. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

In bait-and-switch, sellers try to attract customers to their stores by offering a low price on a product (bait) but, once the customers are in the store, sellers try to persuade them to buy a higher-priced item (switch).

67. Four companies quoted for and supplied paints to a massive housing reconstruction program. There were 200 contracts distributed over 10 years. Each company won 25 percent of the contract each year. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

A situation in which sellers collude to set prices in response to bids or quotations for products is called bid rigging.

68. A large software company released its web browser for free. As a result, other smaller software companies were forced to reduce their price significantly and went out of business. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

The pricing that is intended to drive competitors out of the market or keep competitors from entering the market by fixing very low prices is called predatory pricing.

69. A company sells a mattress, which is claimed to promote good health. It also convinces customers to become part of a club where they receive commissions if they get other people to join the club or buy mattresses. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

A situation in which incentives are offered to consumers to provide the names of other potential consumers is called referral selling.

70. Schemes in which salespersons are paid to recruit other salespeople, and each new salesperson pays for the right to recruit other salespeople, with some of that money going to earlier recruiters is called:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

Schemes in which salespersons are paid to recruit other salespeople, and each new salesperson pays for the right to recruit other salespeople, with some of that money going to earlier recruiters, is called pyramid selling. Participants are often asked to buy a specific quantity of goods or are knowingly sold unreasonable quantities of goods and are not allowed to return the goods on commercially reasonable terms.

71. A driving school charges more to teach women drivers. Its justification is that, even though the lessons and methods are the same as used for men, they think they need to be more careful when women are driving. This is an example of:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. referral selling.
E. resale price maintenance.

Charging different prices to different (competing) buyers for goods of the same quality and of the same quantity is termed “price discrimination.”

72. A hotel management institute develops a training program for students. The fee for the training program is $1,000. The institute offers to share the training program with other colleges for a low price. One of the terms of the contract is that the other colleges should not offer the program to their students for less than $1,000. This is an example of:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. referral selling.
E. resale price maintenance.

In price fixing, sellers conspire to set the price of a product, usually higher than it would be in a free market.

73. Four companies dealing in dairy products admitted that they met to increase the price of their common products together. Which of the following exemplifies the activity of these companies?
A.Price fixing
B. Price discrimination
C. Predatory pricing
D. Referral selling
E. Resale price maintenance

In price fixing, sellers conspire to set the price of a product, usually higher than it would be in a free market.

74. The fee to enter a music event is set at $100 for men and $50 for women. This is an example of:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. referral selling.
E. resale price maintenance.

Charging different prices to different (competing) buyers for goods of the same quality and of the same quantity is termed “price discrimination.”

75. A university publishes a journal, which is subscribed to by individuals and bookshops. The editors have recommended $20 as the retail price. The university also maintains that the journal cannot be sold at a discount. The university has threatened to cease the supply to any bookshop that sells for less than the recommended retail price. This is an example of:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. referral selling.
E. resale price maintenance.

Manufacturers or channel members trying to influence the price at which the product is sold to subsequent purchasers is called resale price maintenance.

76. A country allows millions of extra barrels of oil into the market to push prices downward. This squeezes smaller oil producers out of the market and expand the country’s own market share. This act could be termed:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. referral selling.
E. resale price maintenance.

Pricing that is intended to drive competitors out of the market or keep competitors from entering the market, usually low prices, is termed “predatory pricing.”

77. An automobile company published an advertisement that said that prices for the latest model on offer started at $10,000 with an interest rate of 10 percent. The ad showed the logo and picture of a new model. When an interested customer spoke with the authorized dealer mentioned in the ad, he was informed that the bargain price was only on the older model. This is an example of:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. misleading advertising.
E. resale price maintenance.

All types of advertising about a product or service that are false or misleading is termed “misleading advertising.”

78. Kelly visited a computer store looking for a model listed at $600. The salesperson stated that this model was out of stock and tried to sell her another model priced at $1,352. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral scheme.
E. pyramid sales.

79. Beck wanted to join a gym but was worried about the cost. The gym offered her a 100 percent rebate on a one-year membership if she gave the gym the names and telephone numbers of five of her friends. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

In referral selling, incentives are offered to consumers to provide the names of other potential consumers.

80. A seller refusing to sell to other channel members unless that member agrees to buy solely from that particular seller is termed:
A.price fixing.
B. exclusive dealing.
C. predatory pricing.
D. misleading advertising.
E. refusal to deal.

A seller refusing to sell to other channel members unless that member agrees to buy exclusively from that particular seller is termed “exclusive dealing.”

81. MediaTeq required its employees to send photocopies of a letter to 100 people. The letter contained a list of 10 names and addresses. People were required to send $1 to the first 10 names on the list to join the MediaTeq club. After that, they had to place their names and addresses at the bottom of the list, strike off the first 10 names, and send it to 100 other people. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

Pyramid selling includes schemes where salespersons are paid to recruit other salespeople, and each new salesperson pays for the right to recruit other salespeople, with some of that money going to earlier recruiters. Participants are often asked to buy a specific quantity of goods or are knowingly sold unreasonable quantities of goods and are not allowed to return the goods on commercially reasonable terms.

82. Brian devised a scheme and instructed his partner to submit sham price quotations from dormant companies for a bulletproof-vest contract. The sham price quotations were submitted with intentionally increased prices so that one company, a Kuwaiti general trading firm, would win the contract at a lower price. The owner of the Kuwaiti general trading firm then authorized Brian to negotiate and receive all funds related to the contract. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral scheme.
E. pyramid selling.

Bid rigging includes sellers colluding to set prices in response to bids or quotations for products.

83. Amir owns a fine Steak House Restaurant north of Toronto with the average cost of a meal at $65 per person. What are the two most influential macroenvironmental factors that Amir has to monitor for his business?

84. Corporate partners and political environment
B.Economic situation and competition
C. Culture and Legal environment
D. Economic situation and social trends
E. Customers and corporate partners

Given the price tag for the meals, Amir should monitor the economic situation and adjust the price if required. In addition, social trends (i.e. health and wellness concerns) should be monitored and taken into consideration for offering new dishes.

Teal Electronics Inc. resells DVD players to retail stores for $300. Teal requires the retailers to charge customers $350. Any retailer that charges less than $350 is in violation of its contract with Teal. Therefore, all the retailers come together and decide that the DVD player should not be sold below $350.

84. Which of the following is the marketing practice in which a company seeks to influence the price at which a product is sold?
A.Price fixing
B. Price discrimination
C. Predatory pricing
D. Referral selling
E. Resale price maintenance

Manufacturers or channel members trying to influence the price at which the product is sold to subsequent purchasers is called resale price maintenance.

85. Who is liable for seeking to influence the price at which a product is sold?
A.Teal Electronics
B. The retail stores
C. The consumers
D. The DVD player manufacturer
E. Ochre Corp., Teal’s primary retail client

Manufacturers or channel members trying to influence the price at which the product is sold to subsequent purchasers is called resale price maintenance. Here, Teal Electronics is liable for seeking to influence the price at which the product is sold.

86. Which of the following illegal marketing practices are the retailers primarily involved in?
A.Price fixing
B. Price discrimination
C. Predatory pricing
D. Referral selling
E. Resale price maintenance

Price fixing is when the sellers conspire to set the price of a product, usually higher than it would be in a free market.

Merge and Co. is a grocery chain designed to attract women. It finds that women constitute its biggest buyers, and since more and more women are working and earning good incomes, they are prone to indulging in a variety of foods. Also, to cater to the tastes of women belonging to different ethnic groups, Merge and Co. has positioned a prominent international foods aisle, which highlights Asian, West Indian, Middle Eastern, and Eastern European food products, before the customers reach the central grocery aisles. The food displayed is in keeping with the latest trend of promoting low-calorie, high-nutrition organic products.

87. Which of the following has prodded the grocery chain to exclusively cater to the needs of women customers?
A.The government regulations that make it mandatory to do so
B. The pressure from groups fighting for women rights
C. The changing role of women in society
D. The social constraints that deter women from shopping in crowded areas
E. The pressure from male members of the community

The shifts in gender role, attitude, and behaviour affects the way many firms design and promote their products and services. For example, more firms are careful about gender neutrality in positioning their products and, furthermore, attempt to transcend gender boundaries whenever they can.

88. The presence of food products from different parts of the world in a grocery chain symbolizes:
A.that culture is the same in all parts of the world.
B. the attempt to shut out smaller grocery stores.
C. environmental concern.
D. the growing trend of eating high-calorie, low-nutrition products.
E. variance in the ethnic composition of society.

Statistics Canada data shows that the ethnic composition of Canada has changed over the last two decades and will continue to change in the next decade.

89. The latest trend of promoting low-calorie, high-nutrition organic products is a(n):
A.social trend.
B. legal trend.
C. political trend.
D. cultural trend.
E. economic trend.

In Canada, 60.1 percent of adult men and 44.2 percent of adult women are categorized as obese or overweight. As the same time, consumers’ interest in improving their health has opened up several new markets and niches focused on healthy living.

A company manufacturing mouthwash declared that the mouthwash could cure common ailments such as colds, sore throats, and coughs. It also promised that it was a hair revitalizer and an antiseptic cream for cuts, bruises, wounds, and stings. Tests by independent agencies found that the product was as effective as warm water in treating colds.

90. The marketing practice being followed by the company is called:
A.bait-and-switch.
B. exclusive dealing.
C. pyramid selling.
D. referral selling.
E. misleading advertising.

All types of advertising about a product or service that are false or misleading are called misleading advertising.

91. The marketing practice used by the mouthwash company will be checked by the:
A.Competition Act.
B. Access to Information Act.
C. Canada Agricultural Product Standards Act.
D. Copyright Act.
E. Food and Drugs Act.

Misleading advertising is a marketing practice covered by the Competition Act.

92. Kelly saw an advertisement of TV being sold half-price. When she visits a store to buy it, she is told that she needs to buy a projector, as well, for the offer. Kelly is a victim of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

Sellers try to attract customers to their stores by offering a low price on a product (bait) but, once the customers are in the store, sellers try to persuade them to buy a higher-priced item (switch) in bait-and-switch.

93. While Maria is dining at her favourite Mexican restaurant, she is offered a discount voucher of $20 if she will provide the names and addresses of five friends who might also be interested in Mexican food. This is an example of:
A.bid rigging.
B. bait-and-switch.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

Incentives offered to consumers to provide the names of other potential consumers is called referral selling.

94. A retail store enters into an agreement to buy cheese from a large supplier. The retail store is bound by this agreement and cannot buy cheese from local dairy farms although its prices are lower. This is an example of:
A.exclusive dealing.
B. refusal to deal.
C. predatory pricing.
D. referral selling.
E. pyramid selling.

Exclusive selling involves a seller refusing to sell to other channel members unless that member agrees to buy exclusively from that particular seller.

95. Two airline companies enter into a secret pact to simultaneously increase their fuel surcharges. As a result of the pact, fuel surcharges rose from $10 a ticket to more than $100 a fare. This is an example of:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. referral selling.
E. resale price maintenance.

Sellers conspiring to set the price of a product, usually higher than it would be in a free market is called price fixing.

96. A coffee shop chain opens across the street from a locally owned coffee shop. The base expenses for coffee and pastries are similar. However, the chain has corporate backing for support and therefore makes a decision to radically lower prices. Thus, it succeeds in attracting customers to its facility and eventually drives the local competitor out of business. This is an example of:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. referral selling.
E. resale price maintenance.

Pricing that is intended to drive competitors out of the market or keep competitors from entering the market, usually low prices, is called predatory pricing.

97. A restaurant has two menus, one printed in English, and the other printed in the local language. The prices on the English menu are double those on the other menu. The restaurant owners believe that if a customer cannot read the local language, he must be a tourist and will pay more. This is an example of:
A.price fixing.
B. price discrimination.
C. predatory pricing.
D. referral selling.
E. resale price maintenance.

Charging different prices to different (competing) buyers for goods of the same quality and of the same quantity is termed “price discrimination.”

True / False Questions

98. Parties that work with the focal firm are its corporate partners.
TRUE

Consumers may be influenced directly by the firm’s microenvironment, including the immediate actions of the focal company, the company’s competition, and the corporate partners that work with the firm to make and supply products and services to consumers.

99. Culture is defined as the shared meanings, beliefs, morals, values, and customs of a group of people.
TRUE

Culture is defined as the shared meanings, beliefs, morals, values, and customs of a group of people. Transmitted by words, literature, and institutions, culture is passed down from generation to generation and learned over time.

100. Demographics provide an easily understood “snapshot” of the typical consumer in a specific target market.
TRUE

Advertisers also might want to know whether a show is more popular with women than men or with urban or rural viewers. Demographics thus provide an easily understood “snapshot” of the typical consumer in a specific target market.

101. Generation Xers are also called millennials or the “echo boom” generation.
FALSE

Generation Y, also called millennials or the “echo boom” generation, represent just over 9 million Canadians, or about 27 percent of the population. The next group, Generation X, includes people born between 1966 and 1971.

102. Generation X’s quest for youth, in both attitude and appearance, provides a massive market for anti-aging products, cosmetics, pharmaceuticals, and biotechnology.
FALSE

The baby boomers’ quest for youth, in both attitude and appearance, provides a massive market for anti-aging products, cosmetics, pharmaceuticals, and biotechnology. Marketing to Gen X is difficult, but word-of-mouth advertising from people they know and trust can give marketers the credibility needed to market to this cohort.

103. Food-related advertisements cannot be aired during children’s programming.
TRUE

Food-related advertisements cannot be aired during children’s programming, and companies cannot link unhealthy foods with cartoon and celebrity figures. For example, Burger King no longer uses SpongeBob SquarePants to promote burgers and fries.

104. Today, most Canadians have more time for leisure and to spend with family than they had before.
FALSE

Canadians have less time for leisure and to spend with family. Canadian workers spend about 200 hours less with family per year than they did two decades ago.

105. Some marketers have responded to the challenge of getting consumers’ attention by moving some of their advertising expenditures from TV and print media to instant messaging and Internet-based reviews and ads.
TRUE

Some marketers have responded to the challenge of getting consumers’ attention by, for example, moving some of their advertising expenditures from traditional venues such as TV and print media to instant messaging, Internet-based reviews and ads, social media ads, movie screens, fortune cookies, baggage claim conveyor belts, billboards, and ads in airports and on taxis, buses, and mass transport vehicles.

106. The relative ease with which consumers can use social media has increased the power of consumers to affect a firm’s marketing strategy.
TRUE

The relative ease with which consumers can use social media has dramatically increased the power of consumers to affect a firm’s marketing strategy. Some firms have embraced social media as a way to get excellent feedback from consumers, which is then used to design new or redesign existing products, services, and marketing campaigns and strategies.

107. If the interest rate goes down, consumers have an incentive to save more because they earn more for loaning the bank their money.
FALSE

If the interest rate goes up, consumers have an incentive to save more, because they earn more for loaning the bank their money; when interest rates go down, however, consumers generally borrow more.

108. In a recession, spending by both businesses and consumers is greatly increased.
FALSE

In a recession, the stock market declines sharply, unemployment increases, business and consumer confidence falls, and spending by both businesses and consumers is severely reduced.

109. Government regulation may help to create a level playing field for competition and set standards for marketers to follow.
TRUE

Regulation may help to create a level playing field for competition and set standards for marketers to follow. In other cases, regulation tends to increase the cost of compliance.

110. Price discrimination refers to sellers conspiring to set the price of a product, usually higher than it would be in a free market.
FALSE

Price discrimination refers to charging different prices to different (competing) buyers for goods of the same quality and of the same quantity. Price fixing refers to sellers conspiring to set the price of a product, usually higher than it would be in a free market.

111. Resale price maintenance refers to manufacturers or channel members trying to influence the price at which the product is sold to subsequent purchasers.
TRUE

Resale price maintenance refers to manufacturers or channel members trying to influence the price at which the product is sold to subsequent purchasers.

112. Exclusive dealing refers to a seller refusing to sell to other channel members unless that member agrees to buy exclusively from that particular seller.
TRUE

Exclusive dealing refers to a seller refusing to sell to other channel members unless that member agrees to buy exclusively from that particular seller.

Short Answer Questions

113. Explain the concept of competitive intelligence. Provide one example of how your institution (university or college) can use competitive intelligence?

Competition significantly affects consumers in the microenvironment. Greater competition may mean more choices for consumers, which influences their buying decisions. It is critical that marketers understand their firm’s competitors, including their strengths, weaknesses, and likely reactions to the marketing activities their own firm undertakes. Firms use competitive intelligence (CI) to collect and synthesize information about their position with respect to their rivals. In this way, CI enables companies to anticipate changes in the marketplace rather than merely react to them. The strategies to gather CI can range from simply sending a retail employee to a competitive store to check merchandise, prices, and foot traffic to more involved methods, such as reviewing public materials, including websites, press releases, industry journals, annual reports, subscription databases, permit applications, patent applications, and trade shows; interviewing customers, suppliers, partners, or former employees; and analyzing a rival’s marketing tactics, distribution practices, pricing, and hiring needs.
Student answers will vary. Universities could use CI to find out what programs other universities are offering and what the admission/graduation requirements are.

Accessibility: Keyboard Navigation
Blooms: Apply
Blooms: Remember
Difficulty: Difficult
Learning Objective: 03-01 Outline how the factors in a firm’s microenvironment influence its marketing strategy.
Topic: 03-03 Company Capabilities

114. Describe the shopping habits of the generational cohort, Generation X.

Generation Xers possess considerable spending power because they tend to wait to get married and buy houses later in life. They are much less interested in shopping than their parents but are far more cynical, which tends to make them astute consumers. They demand convenience and tend to be less likely to believe advertising claims or what salespeople tell them. Marketing to Gen X is difficult, but word-of-mouth advertising from people they know and trust can give marketers the credibility needed to market to this cohort. Because of their experience as children of working parents who had little time to shop, Gen X developed shopping savvy at an early age and knew how to make shopping decisions by the time they were teenagers. As a result, they grew more knowledgeable about products and more risk averse than other generational cohorts. Finally, Gen X is much less interested in status products than older generations, not because they can’t afford luxury brands but because they just don’t see the point.

115. The Ford Motor Company is an American multinational automaker headquartered in Detroit, Michigan. Last year, the company sold close to 6.5 million cars worldwide and is the fifth largest automaker in the world. Discuss at least 4 macroenvironmental factors that could affect the company.

Student answers will vary. All the factors could be discussed here; economic situation, technological advances, legal environment, and social trends seem more relevant for The Ford Motor Company.

116. Describe the traits that baby boomers share.

Baby boomers are the largest cohort of Canadians, representing 30 percent of the population. Although the baby boomer generation spans 18 years, experts agree that its members share several traits that set them apart from those born before World War II. First, they are individualistic. Second, leisure time represents a high priority for them. Third, they believe that they will always be able to take care of themselves, which is partly driven by their feeling of economic security, even though they are a little careless about the way they spend their money. Fourth, they have an obsession with maintaining their youth. Fifth and finally, they will always love rock ‘n’ roll.

117. Differentiate between upper-class consumers and middle-class consumers. Provide an example of how a company can use income as a base for segmenting customers.

Upper-class consumers are very affluent, and their spending patterns are not influenced by economic conditions. They have high discretionary incomes and tend to purchase luxury items. Their family income is usually in excess of $80,000. They are more likely to be highly educated and work in managerial and executive roles. About 48 percent of Canadian households are in the upper class. Middle-class families earn between $30,000 and $70,000 with the majority tending toward the higher end of this scale. They can afford a good life most of the time. They tend to be careful about their spending and are often value-conscious. Approximately 38 percent of Canadian households fall in the middle class.

118. Describe the steps being taken by marketers to accommodate the expanding ethnic composition of the Canadian population.

The growing number of ethnic groups or visible minorities represents both a challenge and a marketing opportunity. Canadian grocery heavyweight Sobeys has recently developed a new store concept, FreshCo, specifically targeted to the unique needs of the ethnic consumer. The concept is a value-driven store with low prices like No Frills or Food Basics but with a focus on fresh produce, halal meats, and freshly baked breads (unlike most discount banners) to meet the demands of ethnic clientele. As well, the layout of the store is different. After the store’s layout guides consumers through the fresh produce, bakery, and meat departments, as in a typical retail grocery store, the natural flow of the store takes shoppers through the extended international foods aisle, which highlights Asian, West Indian, Middle Eastern, and Eastern European food products, before the customers reach the centre grocery aisles. Sobeys has also committed to adapting the FreshCo, store assortments to match the demographics of the surrounding neighbourhood, including teaming up with local suppliers. It’s no doubt that other grocery stores will respond to remain competitive. Some of the tactics retailers are taking to accommodate the ethnic consumer include adapting signs and flyers to feature different languages; choosing ethnic-targeted media to advertise; celebrating important ethnic holidays such as Chinese New Year, Ramadan, Eid, and Hanukkah with events, promotions, and seasonal products; and offering ethnic merchandise for sale and making sure it is merchandised correctly.

119. Explain the concept of green marketing.

Green marketing involves a strategic effort by firms to supply customers with environmentally friendly merchandise. Although this “green” trend is not new, it is growing. Many consumers, concerned about everything from the purity of air and water to the safety of beef and salmon, believe that each person can make a difference in the environment. In many cities across Canada, the use of pesticides on lawns is banned and many consumers are trying alternative, environmentally friendly lawn care treatment. Also, a growing number of cities across Canada are introducing the “green bin” program, which encourages consumers to recycle their food and yard waste to make compost for gardening. Initial results suggest that this program is hugely successful everywhere it has been introduced.

120. Explain how the trend of green marketing helps companies that sell environmentally friendly products.

For companies selling environmentally friendly products, this trend represents a great opportunity. The demand for green-oriented products has been a boon to the firms that supply them. For instance, marketers encourage consumers to replace their older versions of washing machines and dishwashers with water- and energy-saving models and to invest in phosphate-free laundry powder and mercury-free, rechargeable batteries. Canada’s love affair with recycling also has created markets for recycled building products, packaging, paper goods, and even sweaters and sneakers. Similarly, this raised energy consciousness has spurred the growth of more-efficient appliances, lighting, and heating and cooling systems in homes and offices. Health-conscious consumers continue to fuel the markets for organic foods, natural cleaning and personal care products, air- and water-filtration devices, bottled water, and organic fertilizers. By offering environmental responsibility, these green products add extra value that other products do not have.

121. Describe the trends that have increased the difficulty that marketers face when trying to gain the attention of consumers.

Reaching a target market has been made even more complicated by several trends that increase the difficulty of grabbing those markets’ attention. First, in the majority of families, both parents work, and the kids are busier than ever. Thus, Canadians have less time for leisure and to spend with family. Second, consumers today have hundreds of shows and programs available to them through TV, radio, PDAs, DVDs, smartphones, personal computers, and the Internet. With many shows and programs available on the Internet, consumers can choose when, where, and what shows they want to watch or listen to at their convenience. By fast-forwarding thorough the commercials, they can catch an entire one-hour show in approximately 47 minutes, which means they miss all the messages marketers are attempting to send them. Third, many consumers attempt to cope with their lack of leisure time by multitasking: watching TV or listening to music while talking on the telephone or doing homework. Their divided attention means they simply cannot focus as well on the advertisements that appear in those media.

122. Describe the negative and positive consequences for Canadian marketers of the rapid increase in the exchange rate between the currencies of Canada and the United States.

The rapid increases in the exchange rate between the currencies of Canada and the United States has both negative and positive consequences for Canadian marketers, depending on whether they are exporters or importers and whether they report their earnings in Canadian or U.S. dollars. The exchange rate changes also have serious implications for consumers as well. As the value of the Canadian dollar increases compared with the U.S. dollar, merchandise made in Canada and exported to the United States becomes more costly to Americans, and Canadian exporting companies suddenly find that they have lost a good chunk of their cost advantage. However, imports of products made in the United States cost less for both Canadian importers and consumers. Another, perhaps unexpected, result of the strengthening of the Canadian dollar compared with the U.S. dollar is that it might allow Canadian manufacturers to win and American manufacturers to lose—that is, imports of raw material from the United States are cheaper. During such inflationary times, “made in America” claims become more important, which means that Canadian manufacturers and U.S. retailers that specialize in Canadian merchandise must decide whether they should attempt to maintain their profit margins or accept a lower price to keep their customer base. It is not always easy for marketers to respond quickly to such rapid increases but marketers who monitor the economic environment have the advantage, as they will be able to adjust their strategies if they foresee the increase.

123. Explain how government legislation protects consumers.

Legislation has been enacted to protect consumers in a variety of ways. First, regulations require manufacturers to abstain from false or misleading advertising practices that might mislead consumers, such as claims that a medication can cure a disease when in fact it causes other health risks. Second, manufacturers are required to identify and remove any harmful or hazardous materials (e.g., asbestos) that might place a consumer at risk. Third, organizations must adhere to fair and reasonable business practices when they communicate with consumers. For example, BP seems to have ignored its own safety procedures and warning signal, which resulted in the largest oil spill in U.S. history, with devastating consequences to the environment and the people of the Gulf Coast. Last but not least, the government enacts laws focused on specific industries and on consumers. These laws may be geared toward increasing competition, such as the deregulation of the telephone and energy industries. Or, they may be in response to current events or to achieve specific objectives, such as when the governments of Ontario and British Columbia introduced the harmonized sales tax (HST) to improve the competitiveness of Canadian businesses, or when the federal government introduced the one-year home renovation tax credit to encourage consumers to spend during the recession.

Search This Blog

Test Banks 2

Marketing 4th Canadian Edition By Grewal – Test Bank

Sample Test

Comments

Post a Comment

Popular posts from this blog

Illustrated Course Guides Teamwork & Team Building – Soft Skills for a Digital Workplace, 2nd Edition by Jeff Butterfield – Test Bank

International Financial Management, Abridged 12th Edition by Madura – Test Bank

Information Security And IT Risk Management 1st Edition by Manish Agrawal – Test Bank