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Exam 12: Manage Marketing Channels, Logistics, and Supply Chain

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Question 31

Multiple Choice

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________ refers to companies handing over most or all of their supply chain activities to third-party organizations that are experts in those areas.

A) Creating assortments
B) Outsourcing
C) Channel integration
D) Disintermediation
E) Breaking bulk

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Question 32

Multiple Choice

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Good Egg Co. buys eggs from local farmers, sorts them into different grades, and then packages them to sell to larger grocers. Good Egg Co. is performing the distribution function of ________.

A) physical distribution
B) product processing
C) determining variety
D) breaking bulk
E) accumulating bulk

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Question 33

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Describe two advantages of e-tailing and two disadvantages. $\underline{Advantages}$ 1. Extensive Selection: No other channel offers the breadth and depth of selection. From information search to purchase, the Internet gives consumers greater access to more choices and different product options. 2. Considerable Information Available for Product Research and Evaluation: The Internet dramatically expands consumers' knowledge, offering an almost unlimited number of websites that research, evaluate, and recommend products and services. From retailers (Best Buy in electronics) to independent testing organizations (CNet in technology), consumers can find information on anything. 3. Build Product Communities: The Internet brings together groups of individuals with a shared interest to create virtual communities. These communities share information, ideas, and product information. 4. Individualized Customer Experience: The Internet allows a great deal of personalization for both the consumer and the company. Consumers can get one-on-one interaction from a customer service representative and create their own web content based on personal preferences. At the same time, companies can tailor messages and web content by analyzing consumer web history. The end result is a more customized, personal experience for the consumer. $\underline{Disadvantages}$ 1. Easier for Customers to Walk Away: The customer is in total control of the web experience and has the opportunity to walk away at any time. In sharp contrast to a personal-selling situation or even a retail store, the customer can simply click to another site. This puts additional pressure on the website to attract and then hold on to visitors. 2. Reduced Ability to Sell Features and Benefits: Websites incorporate sophisticated tools to display and highlight critical features and benefits. However, unless the customer initiates additional contact via web live chat, phone, or e-mail, it can prove challenging to engage the customer to answer questions or deal with objections. 3. Security of Personal Data: Over the past several years, numerous highly publicized data security breaches have occurred involving e-retailers (as well as retail stores). While companies work hard to make their websites secure and keep personal data such as credit card numbers private, many consumers still have concerns about the security of their data. These concerns lead some consumers to limit their electronic purchases.

When a supplier creates a restrictive agreement that prohibits intermediaries that handle its product from selling competing firms' products, ________ has occurred.

Expert power is when channel members adopt an approach of utilizing their unique competencies to influence others in the channel.

Electronic retailing is the communication and sale of products or services to consumers over the Internet.

A vertical marketing system is comprised of independent entities.

In evaluating a website, one of the key measures is its "stickiness," which refers to the amount of time visitors remain and explore a site.

The lead player in an administered VMS is called the channel captain. 

In an ideal supply chain, materials of all kinds are handled as many times as possible.

When a channel member is respected, admired, or revered based on one or more attributes, that member enjoys ________ power within the channel.

A ________ eliminates many in-house business functions and activities in favor of focusing only on those aspects for which it is best equipped to add value.

Venus Office Supplies offers customers a $0.50 coupon for turning in their empty printer cartridges. Venus collects the cartridges and then returns them to the producer for recycling. This is an example of ________.

A(n) ________ represents all organizations involved in providing a firm, the members of its channels of distribution, and its end-user consumers and business users.

Physical distribution, or logistics, is the integrated process of moving input materials to the producer, in-process inventory through the firm, and finished goods out of the firm through the channel of distribution.

________ enhance utilities by providing a wide array of specific functions including physical distribution functions, transaction and communication functions, and facilitating functions.

A vertical marketing system (VMS) consists of vertically aligned networks behaving and performing as a unified system. Explain the three different ways they can be set up.

In the context of the distribution channel, which of the following takes title to a product?

A vertical ________ system consists of vertically aligned networks behaving and performing as a unified system.

Many firms are using outsourcing or third-party logistics to better focus on their core business.