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Chapter 16 - Sales Promotion

Chapter 16 Sales Promotion

Multiple Choice Questions 1. (p. 507) In the opening vignette, Macy's learned the hard way that: A. organic is not necessarily natural B. consumers are sensitive to brand re-identification C. consumers love a deal D. fashion does not always equal style E. coupons are better than cost-cutting See opening vignette.

2. (p. 508) In the opening vignette, Macy's learned that extensive use of discounts and promotional offers: A. reduces the effectiveness of nonfranchise-building promotions B. undermines their ability to build and maintain brand equity C. creates a game that can only be refunded through bonus packs D. are effective substitutes for self-liquidating off-invoice allowances E. create accounting nightmares See opening vignette.

3. (p. 509) ______ is defined as a direct inducement that offers an extra value or incentive for the product to the sales force, distributors, or to ultimate consumer with the primary objective of creating an immediate sale. A. Brand advertising B. A sales promotion C. Direct marketing D. A promotional allowance E. Specialty marketing

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Chapter 16 - Sales Promotion

4. (p. 509) Which of the following elements of the integrated marketing communications programs is designed to provide an extra incentive to consumers to purchase a brand? A. advertising B. direct mail C. public relations D. price E. sales promotion

5. (p. 509) Which of the following statements does NOT describe an aspect or characteristic of sales promotion? A. A sales promotion provides an extra incentive to buy. B. A sales promotion is an acceleration tool designed to speed up the selling process. C. Sales promotion can be targeted to different parties in the marketing channel. D. Sales promotions now account for more of marketer's promotional budget than media advertising. E. Most of the sales promotional dollars are spent on consumer-oriented promotions.

6. (p. 509) Marketers can target sales promotion efforts to: A. consumers B. retailers C. distributors D. salespeople E. all of the above

7. (p. 509) When a marketer distributes coupons for a brand with a specific expiration date, they are attempting to use sales promotion as a(n): A. brand franchise building promotion B. brand equity building promotion C. acceleration tool D. value added tool E. promotional marketing tool

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Chapter 16 - Sales Promotion

8. (p. 509) Coupons, bonus packs, premiums and samples are promotional offers that are targeted toward: A. consumers B. retailers C. wholesalers D. salespeople E. all of the above

9. (p. 510) Consumer-oriented sales promotions are part of a promotional ______ strategy. A. EDLP B. pull C. trade D. premium E. push

10. (p. 510) All of the following are examples of trade-oriented sales promotion activities EXCEPT: A. off-invoice allowances B. promotional allowances C. point-of-purchase displays D. trade shows E. coupons

11. (p. 510) All of the following are examples of consumer-oriented sales promotion activities EXCEPT: A. samples B. coupons C. refunds/rebates D. trade shows E. bonus packs

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Chapter 16 - Sales Promotion

12. (p. 510) Which of the following statements about sales promotion programs is true? A. Sales promotion programs are targeted only at consumers. B. Many sales promotion programs are designed to motivate distributors and retailers to carry a product and push it to their customers. C. Nearly three quarters of all sales promotion dollars are spent on consumer promotions. D. Sales promotion dollars for most companies are allocated equally between consumers and the trade. E. Sales promotion strategies aimed at marketing intermediaries are called pull strategies.

13. (p. 511) Among major packaged goods companies, the greatest percentage of the promotional budget is allocated to: A. media advertising B. consumer promotions C. trade promotions D. direct marketing E. trade shows

14. (p. 511) Among major packaged goods companies, spending on _____ has remained relatively constant over the past decade. A. trade promotion B. consumer promotion C. media advertising D. direct mail E. public relations activities

15. (p. 511) How has the view of sales promotions changed during the past decades? A. Sales promotions are now considered an essential part of an organization's branding strategies. B. Sales promotion tactics are now developed before the strategy is determined. C. Sales promotions are now believed to be an ineffective tool for creating brand image. D. Creatives have become more sophisticated, and this sophistication has led to a decline in their dependence on sales promotion. E. There is no difference between how marketers used to treat sales promotions and how they treat them now.

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Chapter 16 - Sales Promotion

16. (p. 511) Why are organizations like KFC, Heinz Foods, Toys R Us, and Anheuser Busch placing more emphasis on sales promotions than ever before? A. because they want to use sales promotions rather than engage in price wars B. because they are convinced sales promotions can be used to build brand equity more effectively and more quickly than other promotional mix elements C. because the use of sales promotions allows them to cut back and/or completely eliminate their use of coupons D. because consumers have less time to shop E. because the use of allowances, deals, and premiums confuse consumers

17. (p. 511) Which of the following helps to explain the increase in sales promotion activities over the last decade? A. the increase of brand loyalty in many product categories B. the tremendous decrease in the number of new products C. the increased emphasis on long term strategy and performance by most companies D. the advertising clutter problem E. all of the above

18. (p. 512) Which of the following developments have resulted in a transfer of power from manufacturers to retailers? A. The advent of optical scanners and computers gave manufacturers access to sales information. B. Manufacturers are spending more money on media advertising. C. Consolidation in the grocery industry has resulted in larger chains with greater buying power and clout. D. Manufacturers are spending more money on marketing research. E. Manufacturers are introducing more private-label brands.

19. (p. 512) Consumers have become more sensitive and responsive to sales promotion because: A. consumers are multi-brand loyal B. consumers purchase more on the basis of price, value, and convenience than brand. C. many purchase decisions are being made in the store where many sales promotions are found D. marketers are offering consumers more promotions to attract and maintain customers E. of all of the above reasons

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20. (p. 512) Marketing planning and reward systems may lead to an increase in the use of sales promotion because sales promotions encourage: A. managers to use advertising to build brand equity B. managers to use consumer-oriented sales promotion to meet long-term performance goals C. sales reps to encourage their marketing managers not to use promotions to help them get orders from retailers D. the use of price-oriented promotions to generate short-term sales E. all of the above

21. (p. 514) Which of the following statements about the proliferation of new products in the consumer marketplace is true? A. Consumer product companies launch approximately 20,000 new products each year. B. Sales promotion programs play an important role in motivating retailers to allocate shelf space to new products. C. Supermarkets now carry an average of 30,000 different products compared to 13,067 in 1982. D. Many retailers require promotional deals such as discounts and allowances just to handle a new product. E. All of the above statements about the proliferation of new products in the consumer marketplace are true.

22. (p. 514) Which of the following statements about the proliferation of new products in the consumer marketplace is true? A. Consumer product companies launch approximately 20,000 new products each year. B. Only when dealing with pricing strategy will marketing managers have to be concerned about slotting allowances. C. Supermarkets today carry more SKUs of specific products, and fewer different brands of products than they once did. D. Manufacturers are the leading users of promotions, and their choices of sales promotions are not influenced in any way by retailers. E. All of the above statements about the proliferation of new products in the consumer marketplace are true.

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23. (p. 514) How are marketers responding to the fragmentation of the consumer market? A. They are using more direct selling to make event sponsorship more successful. B. They are using less direct marketing. C. They are using more sales promotions that are tied into local events. D. They are employing clipping services to determine the effectiveness of their press releases. E. They have basically ignored the fragmentation of the consumer market and continued doing business as usual.

24. (p. 513) Wal-Mart is known for its marketing ______________, influencing all aspects of marketing including sales promotions by brand manufacturers. A. simplicity B. power C. linearity D. cooperation E. religion See IMC Perspective 16-1.

25. (p. 515) What do many businesspeople give as a reason for the increasingly short-term focus on performance and sales volume in business today? A. the primacy effect B. the more rapid movement of consumers through the hierarchy of effects model C. a habit of frequent repositioning D. synergistic buying E. the brand management system

26. (p. 515) Marketers who are being held accountable for strategy implementation often need concrete methods to show the effectiveness of their decision-making. For this reason, many marketers rely on: A. personal selling instead of mass-media advertising B. a strategy that eliminates any advertising carryover effect C. sales promotions such as coupons and price discounts D. event sponsorships E. out-of-home advertising media

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Chapter 16 - Sales Promotion

27. (p. 515) _____ is a recent development whereby companies are customizing their sales promotion programs for key retailers. A. Incentive marketing B. Accountability marketing C. Account-specific marketing D. Trade marketing E. Franchise building

28. (p. 516) Another name for account-specific marketing is: A. a planogram program B. comarketing C. dual sponsorship D. piggyback marketing E. key-account communications

29. (p. 516) The toy company Hasbro teamed with the retailer Toys R Us to create direct mail booklets offering discounts on Hasbro toys good only at Toys R Us stores. This is an example of: A. incentive marketing B. a franchise building promotion C. brand equity building D. account-specific marketing E. none of the above

30. (p. 516) Heinz Foods created a Cinco de Maio celebration for a large supermarket that targets Mexican-Americans, a market that Heinz sees as an area of potential growth. Heinz paid for a mariachi band to serenade shoppers during the day and also set up a food-sampling booth at the store's entry. This would be an example of: A. incentive marketing B. a franchise building promotion C. brand equity building D. account-specific marketing E. none of the above

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Chapter 16 - Sales Promotion

31. (p. 516) Some promotional studies indicate the number of sales promotions being offered to consumers is limiting its effectiveness as a marketing tool. In other words, _____ is affecting sales promotion just as it has advertising. A. clutter B. the recency effect C. the carryover effect D. noise E. subliminal perception

32. (p. 516) Critics of sales promotions contend the increase in sales promotions is leading to a decrease in: A. retailer power B. ad readership scores C. brand equity D. promotional traps E. consumer primacy

33. (p. 516) Which of the following statements correctly describes the relationship between brand equity and sales promotion? A. Critics argue sales promotion spending contributes to the destruction of brand equity. B. Critics argue every dollar that is spent on promotion rather advertising devalues the brand. C. Critics argue sales promotion is leading to reductions in brand equity because it comes at the expense of media advertising. D. Not all sales promotion activities detract from brand equity. E. All of the above statements about the concerns over the relationship between brand equity and advertising and promotion are true.

34. (p. 517) Sales promotion activities that communicate distinctive brand attributes and contribute to the development and reinforcement of brand identity are: A. nonfranchise building promotions B. franchise building promotions C. high-involvement sales promotions D. sales promotion traps E. event marketing

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Chapter 16 - Sales Promotion

35. (p. 517) Which of the following statements describes how brand equity is affected by the increased role of sales promotion? A. Critics argue sales promotions generally result in higher brand equity. B. Sales promotions do not contribute to the erosion of brand equity. C. Proponents of brand equity argue increased spending on sales promotion is coming at the expense of media advertising, and this is leading to declines in brand equity. D. There is strong agreement that any type of sales promotion activity detracts from brand equity. E. All of the above statements describe how brand equity is affected by the increased role of sales promotion.

36. (p. 517) In a sales promotion sponsored jointly by Puerto Rico Tourism Board and Rums of Puerto Rico, couples were invited to enter a contest for a chance to win the perfect wedding. According to the ad, enjoying Puerto Rico hospitality is "As Easy As Saying I Do." The contest is an example of: A. a nonfranchise building promotion B. a franchise building promotion C. a high-involvement sales promotion D. a sales promotion trap E. event marketing

37. (p. 517) Tropicana developed a "Win the Perfect Vacation" sweepstakes to complement an advertising campaign theme promoting its grapefruit juice as the perfect beverage. This is an example of: A. a nonfranchise building promotion B. a franchise building promotion C. a high-involvement sales promotion D. a sales promotion trap E. event marketing

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38. (p. 517) Consumer-franchise-building for a brand: A. is the exclusive responsibility of advertising B. is accomplished through short-term price-oriented promotions C. is impossible to do through consumer promotions D. can be accomplished through consumer promotions that reinforce established brand images or positioning E. is becoming less important to marketers as competition intensifies

39. (p. 517) The building or reinforcement of consumer-franchise or equity for a brand: A. can really only be accomplished through advertising B. can be done with carefully planned sales promotion programs C. can be done with more easily through trade-oriented promotions than through consumeroriented promotions D. is really not very important given the prolonged economic prosperity the U.S. economy has been in E. is accurately described by none of the above

40. (p. 5017) Which of the following is an example of a sales promotion that can be used to contribute to franchise building? A. a 50-cents off coupon on a box of Minute Rice to encourage repurchase B. a sweepstakes or contest that uses a theme which is consistent with the image or positioning of the brand C. a $50-rebate offer on the purchase of a Lane cedar chest D. a price reduction of $5 on a pair of Lee jeans E. all of the above

41. (p. 517) Which of the following is an example of a nonfranchise building promotion? A. consumer sampling B. contests targeted to ultimate consumers C. price-off deals D. event sponsorship E. frequency programs

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Chapter 16 - Sales Promotion

42. (p. 518) Van Kamp Sea Foods devotes most of its marketing budget to trade discounts in the form of off-invoice and promotional allowances so its canned tuna and salmon brands can remain price competitive with private label brands. The heavy emphasis on trade promotion makes it difficult to: A. encourage consumers to buy on the basis of price B. build and maintain store equity for retailers that carry the Van Kamp brand C. build relationships with the trade D. build a Van Kamp brand identity and image E. encourage retailers to use Van Kamp's planograms

43. (p. 518) Promotional activities designed to accelerate the purchase process and generate an immediate increase in sales without communicating information about a brand's unique features or benefits are known as: A. consumer franchise-building promotion B. nonfranchise-building promotion C. sweepstakes D. image promotions E. trade promotions

44. (p. 518) Which of the following would be NOT an example of a nonfranchise-building promotion? A. price-off deals B. bonus packs C. rebates D. image advertising E. promotional deals to retailers

45. (p. 518) The sales promotion tool that critics contend is most guilty of detracting from brand equity and at the same time being detrimental to a brand franchise is: A. sweepstakes B. contests C. frequent patronage programs D. trade promotions E. event sponsorships

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Chapter 16 - Sales Promotion

46. (p. 518) Which of the following is a reasonable objective for consumer-oriented sales promotions? A. to obtain trial of a new brand B. to encourage repurchase of a brand C. to increase consumption of an established brand D. to enhance advertising and marketing efforts E. all of the above

47. (p. 518) When Campbell Soup Company introduced its V8 Splash fruit medley juices, the company gave out free samples at Sam's Clubs and distributed millions of 50-cents-off coupons. The objective(s) of these sales promotion tools was to: A. defend the brand's customer base B. obtain trial and repurchase C. target a specific market D. increase consumption of an established brand E. create long-term brand equity

48. (p. 519) Which of the following statements about sales promotions is true? A. Ivory soap carving contests were used to support the war effort in World War II. B. McDonald's was sued for illegally using the Monopoly game contest. C. The Oscar Mayer Wienermobile was the first sales promotion premium offer. D. Sweepstakes are seen as more involving and more motivating than contests. E. The oldest, most widely used, and most effective sales promotion tool is the cents-off coupon. See IMC Perspective 16-2.

49. (p. 519) The American Airline AAdvantage promotional program rewarded consumer: A. loyalty B. diversity C. diversification D. price sensitivity E. demographic segmentation See Figure 16-2.

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Chapter 16 - Sales Promotion

50. (p. 520) Post Cereal is introducing a new kind of breakfast cereal that is soy-based and targeted at health-conscious adults between the ages of 25 and 50. The marketing objectives for the introduction are to generate trial and repeat purchase during the 3-month product launch. Which of the following sales promotion tools should work best for Post? A. sampling and rebates B. rebates and high value checkout coupons C. bonus packs, trade allowances, and slotting fees D. high value in package coupons and sampling E. sweepstakes, contests, and rebates

51. (p. 520) Sales promotion tools could be used to increase sales of an established brand by: A. giving away samples to attract nonusers of the brand B. u...