EOPA Study Guide Part 4

Which of the following is the right time for a business to make promotional decisions in relation to product, price, and distribution decisions:

• After product, price, and distribution

• Before product, price, and distribution

• Along with product, price, and distribution

• Without considering product, price, and distribution

Answer explanation

After product, price, and distribution. Before businesses can make promotional decisions, they should  develop and price the product and decide how it will be distributed. Businesses need information about  product, price, and place before making promotional decisions. For example, it would be useless for a  business to promote a product without being prepared to produce and distribute it.

An ad informing consumers of a company's efforts to stop pollution is an example of __________ promotion.

• promotional

• institutional

• direct-mail

• retail

Answer explanation

Institutional. Institutional promotion attempts to create an image of the business in the eyes of  consumers. Institutional advertising builds goodwill by convincing consumers that the business is  interested in the welfare of the community. Retail promotion is any promotion used by a retail business.  Direct mail is a method of promotion in which promotional messages are sent to specific individuals who  may be interested in a particular product. The purpose of promotional advertising is to stimulate  consumer purchases of goods and services. 

Which of the following is the basic purpose of a company's promotional mix:

• To provide all product information

• To influence consumers to purchase

• To list the company's products

• To reduce competitors' sales

Answer explanation

To influence consumers to purchase. Businesses combine or mix the different forms or elements of  promotion in order to create the promotional mix that will be the most effective for them. Their ultimate  goal is to sell their own product(s), rather than reduce competitors' sales, simply list their products, or try  to provide complete product information. 

Technology advancements have provided marketers the ability to send cost-effective, opt-in promotional messages to a customer's __________ address.

• P.O. box

• street

• email

• secondary

Answer explanation

Email. Electronic mail is a method of sending promotional messages via computer networks. Each  computer has its own email address or path. A street address is a number and street name of a facility  that is set up to receive traditional mail service. A P.O. box is a location in a post office where customers  can send their mail to hold until they pick it up. A secondary address is a general term used to describe  an alternate address to send mail; it can be an electronic or traditional mail location.

Which of the following is an example of specialty advertising:

• Skywriting

• A postcard announcing a special sale

• Billboards

• Key rings bearing a company's name

Answer explanation

Key rings bearing a company's name. Specialty advertising is the use of small items that contain the  company's name and/or a brief promotional message. The items are usually given to customers to  remind them of the business. Examples of other specialty advertising items are pens, matchbooks,  calendars, etc. A postcard announcing a special sale is an example of direct mail. Skywriting and  billboards are examples of out-of-home media. 

Which step in the new-product development process involves seeking feedback from consumers in order to know what response they would give to a proposed product?

• Idea generation

• Product screening

• Concept testing

• Feasibility analysis

Answer explanation

Concept testing. During concept testing, a product concept, or idea, is explored with potential consumers  to determine what response they would give to a proposed product idea. Product planners try to  determine if it is the right time to introduce the product, whether consumers would buy the product, and  what consumers would want the product to do. Idea generation is the step of new-product development  in which ideas for new products are developed. Product screening involves considering each idea for a  new product and discarding ideas that seem unworkable. A feasibility analysis is the step in the new product development process that involves examining such factors as demand, costs, competition,  capital investment required, and potential profit of a product or service to determine how it will fit into the  company's product mix. 

What is one question that a company needs to answer about a product that is in the introductory stage of its life cycle?

• Should we regionalize the product?

• Does the product need to be modernized?

• Should we take the product off the market?

• How can we make the public aware of our product?

Answer explanation

How can we make the public aware of our product? In the introductory stage of the product life cycle, the  most important focus for a company is to draw attention to its product. Without awareness, sales cannot  occur and the product/company cannot gain market share. A company wouldn't consider taking a product  off the market immediately after it is introduced. Regionalizing and modernizing the product are  considerations for products that are in the decline stage of the product life cycle.

Many businesses are using the technology developed by the space program to create A. advanced new products.

• advanced new products. 

• marketing strategies. 

• updated brand names.

• advertising techniques.

Answer explanation

Advanced new products. The technology developed by the space program and other government-funded  projects ultimately becomes available to businesses that use the technology to create advanced new  products for the general public. Businesses take advantage of the technology to develop products that  improve the lives of customers and meet the needs of modern society. Also, by creating new products,  businesses have the opportunity to increase sales and expand operations. The technology developed by  the space program does not help businesses to create marketing strategies, updated brand names, or  advertising techniques.

The Underwriters Laboratory seal on an electrical product indicates

• quality and safety backed by a testing organization

• a guarantee by the manufacturer

• the product can be returned

• standard grades established by the federal government

Answer explanation

Quality and safety backed by a testing organization. The Underwriters Laboratory is an independent  testing organization that tests electrical products for quality and safety. The UL symbol does not indicate  that the product can be returned, represent a guarantee by the manufacturer, or imply a standard of  acceptance established by the federal government. 

A warranty that covers the entire product is known as a(n) __________ warranty.

• full

• limited

• express

• implied

Answer explanation

Full. A full warranty is not limited to certain aspects of the product but covers the entire product. A  warranty concerning the quality of the product that is written or expressed verbally is an express  warranty. A limited warranty does not contain the provisions of a full warranty. It may cover only certain  repairs or specific parts. An implied warranty is understood by the customer and the seller that the  product will perform as expected.