Marketing Management MCQ Quiz - Objective Question with Answer for Marketing Management - Download Free PDF

The correct answer is - Ambush marketing

Key Points

• Ambush marketing
  • Refers to a marketing strategy where a company or brand seeks to capitalize on the publicity of a major event without officially sponsoring it.
  • Brands use creative advertising or promotional campaigns to associate themselves with the event indirectly.
  • This approach allows companies to gain visibility and attention without incurring the high costs of sponsorship fees.
  • It is often considered controversial and can lead to disputes between event organizers and the brands employing this tactic.
  • Examples include displaying advertisements near event venues or using hashtags associated with the event without formal partnership.

Additional Information

• Types of Marketing Strategies
  • Dependent Marketing: Involves relying on partnerships or dependencies with other brands or entities to promote products or services.
  • Survival Marketing: Focuses on strategies that help businesses maintain operations during challenging times, such as economic downturns or intense competition.
  • Skill Marketing: Refers to promoting products or services based on the unique skills or expertise of the company or individual.
• Ambush Marketing vs Official Sponsorship
  • Official sponsorship involves a contractual agreement between the brand and event organizers, granting exclusive rights to advertise during the event.
  • Ambush marketing circumvents this agreement and is often seen as opportunistic, leveraging the event's popularity without contributing to its funding.
• Ethical Considerations
  • Ambush marketing can raise ethical concerns, as it may undermine the investments made by official sponsors.
  • Event organizers may implement policies or legal measures to protect sponsors from ambush marketing tactics.

The correct answer is - Customer Lifetime Value

Key Points

• Customer Lifetime Value (CLV)
  • CLV measures the total revenue a business can expect to earn from a customer over the entire duration of their relationship.
  • It is a crucial metric for evaluating long-term customer value and helps businesses focus on strategies to maximize this value.
  • Unlike metrics like short-term value or satisfaction value, CLV provides a more comprehensive view, including repeat purchases, upselling, and cross-selling opportunities.
  • Understanding CLV allows businesses to allocate resources effectively to customer acquisition and retention efforts.

Additional Information

• Short-Term Value
  • Measures the immediate revenue generated from a customer within a short time frame.
  • It focuses on quick returns but does not account for long-term relationship benefits.
• Relationship Value
  • Focuses on the qualitative benefits of a customer relationship, such as loyalty or brand advocacy.
  • It is less quantifiable compared to metrics like CLV.
• Satisfaction Value
  • Measures customer happiness based on their experiences with the product or service.
  • While satisfaction influences retention, it does not directly measure monetary value.
• Why Customer Lifetime Value is Important
  • It helps businesses prioritize customers who are likely to generate the highest long-term revenue.
  • CLV is used to optimize marketing and retention strategies by focusing on high-value customers.

The correct answer is - Durability

Key Points

• Durability
  • Durability refers to the ability of a product to last over time and withstand wear and tear.
  • This feature is typically associated with physical goods rather than services.
  • Services lack the physical nature required for durability, as they are inherently intangible.
  • Unlike physical goods, services cannot be stored or preserved for future use, making durability irrelevant to their characteristics.

Additional Information

• Unique Features of Services
  • Heterogeneity: Services vary from one provider to another and cannot be standardized completely. For example, the quality of a haircut may differ between hairstylists.
  • Intangibility: Services do not have a physical form and cannot be touched or seen. For instance, consulting services are intangible.
  • Perishability: Services cannot be stored or saved for future use. A missed doctor's appointment is an example of service perishability.
• Comparison with Physical Goods
  • Physical goods exhibit features such as durability, tangibility, and the ability to be stored.
  • Services, on the other hand, are characterized by intangibility, heterogeneity, and perishability, distinguishing them from goods.

The correct answer is - Leverage pricing

Key Points

• Leverage pricing
  • Leverage pricing is not a recognized pricing methodology in business or economics.
  • Commonly used pricing strategies include methods like cost-based pricing, value-based pricing, and differentiated pricing.
  • The term "Leverage pricing" does not correspond to any standard or widely accepted strategy in academic or practical domains.
  • Other options listed (e.g., Differentiated pricing, Cost-based pricing) are valid pricing methods widely taught in business courses and applied in industries.

Additional Information

• Differentiated pricing
  • Also known as price discrimination, it involves charging different prices to different customer groups for the same product or service.
  • Examples include discounts based on age, location, or time of purchase.
• Cost-based pricing
  • Pricing is determined by adding a markup to the cost of production.
  • This method ensures that all costs are covered and a profit margin is included.
• Affordability-based pricing
  • Focuses on setting prices based on what the target audience can afford.
  • Commonly used for products aimed at low-income groups or price-sensitive markets.

The correct answer is - Selective retention

Key Points

• Selective retention
  • This refers to the process by which individuals tend to retain information that is consistent with their beliefs or attitudes.
  • It involves the ability of people to store and recall certain pieces of information while ignoring others.
  • Selective retention plays a significant role in decision-making as it filters out irrelevant data and focuses on meaningful content.
  • For example, a consumer might remember advertisements or product details that align with their preferences, while forgetting others.

Additional Information

• Selective attention
  • It is the ability to focus on certain stimuli while ignoring others in the environment.
  • This often occurs when individuals concentrate on information that is relevant to their needs or goals.
• Selective distortion
  • It refers to the tendency of individuals to interpret information in a way that aligns with their pre-existing beliefs.
  • Selective distortion can lead to biased or skewed understanding of facts.
• Self-actualisation
  • This is a concept from Maslow's hierarchy of needs, describing the process of realizing one's full potential.
  • It is more related to personal growth and fulfillment, not information processing.

The correct answer is Capital Goods.

Key Points

• - Capital goods are durable goods used in the production process, such as machinery, tools, and equipment.
• - These goods are not meant for immediate consumption but are rather used to produce other goods or services.
• - Capital goods are considered an investment in a company's productive capacity and are often depreciated over time.
• - Examples of capital goods include manufacturing equipment, vehicles used for transportation of goods, and computer systems used for data analysis.

Additional Information

•  - Veblen goods are luxury goods that are in demand because of their high price and exclusivity, such as designer clothing and luxury cars.
• - Consumption goods are goods that are used for immediate satisfaction of wants and needs, such as food and clothing.
• - Complementary goods are goods that are used together, such as bread and butter or smartphones and phone cases

Direct marketing:

• Direct marketing gives the opportunity of promoting goods and services directly to the customers who need them the most.
• Direct marketing helps in building relationships with new customers. 
• All promotional information is relayed without intermediaries and any third parties.
• Emails, newspapers, outdoor advertising, SMS marketing, Tele-marketing, websites, catalog distribution, etc. are various types of direct marketing strategies.

Therefore, Tele-marketing is a part of Direct marketing.

Viral marketing:

• Viral marketing is an advertising strategy that uses social media to generate interest and a potential sale of a brand or product through viral messages in the form of memes, shares, likes, and forwards. 
• It refers to how consumers spread information about a product with other people, in the same way, that a virus spreads from one person to another.
• In other words, marketing is considered viral when it reaches a point where it is being shared by the people at large rather than just the target audience.

Social marketing:

• It is a systematic application of marketing activities along with other concepts and techniques to achieve specific behavioral goals for social good.
• Philip Kotler states, "Social marketing seeks to influence social behaviors not to benefit the marketer, but to benefit the target audience and the general society."
• This technique has been used extensively in international health and sanitation programs.
• The main objective of social marketing is to promote the well being of society.

Relationship marketing:

• It is defined as, "Relationship marketing is a strategy designed to foster customer loyalty, interaction and long-term engagement. It is designed to develop strong connections with customers by providing them with information directly suited to their needs and interests and by promoting open communication."
• It refers to the activities undertaken by the organization to maintain loyalty, profitability, and long-term relationship with the customers.

Mass Marketing does not deal with customers directly.

1. Mass marketing is a market strategy in which a firm decides to ignore market segment differences and appeal to the whole market with one offer or one strategy, which supports the idea of broadcasting a message that will reach the largest number of people possible.
2. Mass marketing has very little direct contact with its customers and must distribute its product through various retail outlets alongside its competitors.
3. Communication is impersonal, as evidenced by its national television and print advertising campaigns, couponing, and point-of-purchase displays.
4. The success of mass marketing is contingent on the probability that within the huge audience exposed to the marketing strategy there exist sufficient potential customers interested in the product to make the strategy worthwhile.

"Think different” is an advertising slogan used by Apple Computer Inc, now named Apple Inc.

• The slogan was taken as a response to IBM’s slogan Think.
• The company was found on April 1, 1976, by Steve Jobs, Steve Wozniak, Ronald Wayne.
• Steve Jobs, the co-founder of the company wished to build an advertising campaign that would remind people about the loyal fan-base of apple and it made him use the slogan "Think different".
• The headquarters of the company is in California US.

1. Amazon

• Amazon company was found on 5th July 1994 by Jeff Bezos.
• The headquarters of the company is in Seattle, Washington, U.S.
• Amazon company is an E-commerce company that provides web hosting, online shopping, and content distribution services.
• The Tagline of the company is " Work Hard, Have fun".

2. Facebook

• Facebook was found on 4th July 2004 by Mark Zuckerberg, Chris Hughes, Andrew McCollum, Eduardo Saverin, Dustin Moskovitz.
• The headquarters of the company is in Menlo Park, California, U.S
• Facebook provides social networking services.

3. Google

• Google was found on 4th September 1998 by Larry Page & Sergey Brin.
• The headquarters of the company is in Googleplex, Mountain View, California, U.S.
• Google is an internet computer software industry.
• The parent company of Google is Alphabet Inc.
• The Tagline of the company is "Don't be evil".

Market orientation:

1. Market orientation is a business philosophy where the focus is on identifying customer needs or wants and meeting them.
2. When a company has a market orientation approach, it focuses on designing and selling goods and services that satisfy customer needs in order to be profitable.
3. The successful market-oriented company discovers and meets the desires and needs of its customers through its marketing mix.

Important features of the Marketing Mix:

1. The marketing mix is a planned mix of activities.
2. The ingredients in the marketing mix are product, place, price, and promotion.
3. It is a combination of elements that you will use to market your product.
4. Marketers use the marketing mix to create value for their products.
5. The four elements of the marketing mix are used and adjusted until the marketer gets the results that he wants.
6. For example, pricing decisions are exercised in the form of cash discounts that convince customers to buy.

1. Product integration is similar to product placement, except it involves the actual integration of the product or brand into the script of the television show or movie. For example, product integration could include the storyline of a television episode revolving around a character's use of Speed Stick deodorant.
2. Concentrated Marketing is a strategy whereby a product is developed and marketed for a very well-defined and specific segment of the consumer population.
3. Market segmentation is a business practice that brands use to divide their target market into smaller, more manageable groups of people based on the common ground they share to optimize their marketing, advertising, and sales efforts. 

Therefore, Market orientation is a technique of selecting a marketing mix.

Traditionally, marketing has been viewed as a simple exchange.

Key Points

Traditional Marketing:

• Marketing has existed since time immemorial.
• The traditional marketing concept is defined as " simple exchange of goods and services for some benefit".
• It is based on three concepts i.e customer orientation, integration of efforts, and profit objective. In this concept of marketing, all the efforts are directed towards the mere selling of goods in exchange for some profit.
• The merchants are simply involved in "changing of hands" from the sellers to the buyers. The buyers purchase these goods and services in exchange for some money. All the actions are integrated towards the production of higher quality goods for the purchase of selling to the ultimate customers.
• The producers have a "profit motive", where efforts are put into maximizing profits as much as possible. In this concept, customers' needs and wants are given a priority, hence it is sometimes also known as the "market-driven" concept.

BCG (Boston Consulting Group matrix)

• The BCG (Boston Consulting Group matrix) is also known as the product portfolio matrix.
• It is a planning tool of the business which is used to estimate the strategic position of the brand portfolio of a firm.
• BCG matrix is a popular portfolio analysis method that classifies the product or service of a firm in a 2x2 matrix.
• Each quadrant is categorized as a high or low performance, according to the relative market growth rate and market share.

• The products in the cash cow quadrant have a high market share but low growth rate capacity.
• The products in this quadrant are of the thought that the products are the leaders in the marketplace.
• The products have a high amount of investments in them and they don’t need any further investment or any help to maintain their position in the market.
• The cash generated by cash cows is high and is used to finance the other three quadrants i.e., star, question mark, and dogs.
• The products present in the cash cow quadrant are “milked” and little investment is required to reap high profits and a positive cash flow.

Therefore, the cow quadrant has the largest positive cash flow and serves the other 3 quadrants.

1. Star Quadrant

• Star quadrant has products that have a high market share and grow quickly. The products are market-leading and need high investment to hold their market position, maintain the competitive advantage, and boost growth.
• When the market matures and products remain successful, the star products migrate successfully to become cash cows.

2. Dog Quadrant

• In the dog quadrant, the products have a low market share and low growth rate.
• The products in this quadrant sustain themselves and have cash flow but they never reach the star quadrant.
• Firms phase out their products in the dog quadrant unless the product is of competitive purpose or complementary to existing products.

3. Question Mark

•    In question mark, the products have a low market share and grow quickly. Question marks are the most intensive products that require wide resources and investment to increase the market share.
• The investment of products is funded by the cash cow quadrant.
• A firm wishes to convert its question marks into stars and if they do not succeed in becoming the market leader, they turn up becoming dogs when the market growth rate declines.   

Customer value reflects the sum of perceived tangible and intangible benefits and costs to a customer.

Explanation:

Customer Value is the perception of what a product or service is worth to a Customer versus the possible alternatives. Worth means whether the Customer feels s/he or he got benefits and services over what s/he paid. In a simplistic equation form, Customer Value is Benefits-Cost (CV=B-C).

1. Customer Satisfaction: 

• Customer satisfaction (often abbreviated as CSAT) is a term frequently used in marketing.
• It is a measure of how products and services supplied by a company meet or surpass customer expectation.
• Customer satisfaction is defined as "the number of customers, or percentage of total customers, whose reported experience with a firm, its products, or its services (ratings) exceeds specified satisfaction goals."

Customer Delight: 

• Customer delight is surprising a customer by exceeding his or her expectations and thus creating a positive emotional reaction.
• This emotional reaction leads to word of mouth.
• Customer delight directly affects the sales and profitability of a company as it helps to distinguish the company and its products and services from the competition. 

Customer Expectation: 

• By definition, customer expectations are any set of behaviors or actions that individuals anticipate when interacting with a company.
• Historically, customers have expected basics like quality service and fair pricing — but modern customers have much higher expectations, such as proactive service, personalized interactions, and connected experiences across channels.

Marketing may be defined as the collection of activities undertaken by the firm to relate profitability to its market. Marketing in the modem context goes beyond its immediate role as a process through which the exchange of goods and services takes place and is viewed as an integral part of the total socio­economic system which provides the framework within which activities take place.

Current Concepts in Marketing:

1. Social Marketing:

• Philip Kotler has defined his social marketing concept as a management orientation aimed at generating customer satisfaction and long-run consumer and public welfare and as the key to satisfying organizational goals and responsibilities. 

2. Over Marketing:

• It constitutes the striving of a firm to generate increased sales while neglecting quality control, production efficiency, and cash flow management.

3. De-marketing:

• ​Webster’s dictionary says that demarketing is “The use of advertising to decrease demand for a product that is in short supply.”
• Basically, any attempt that is made to discourage consumers from buying a certain product is called demarketing.

4. Re-marketing:

• Remarketing is a way to connect with people who previously interacted with your website or mobile app.
• It allows you to strategically position your ads in front of these audiences as they browse Google or its partner websites, thus helping you increase your brand awareness or remind those audiences to make a purchase.

5. Under-marketing:

• It refers to insufficient marketing of products and services.

Therefore, generated increased sales by neglecting quality control, production efficiency, and /or cash flow management are over-marketing.

Low average spends per customer is not a characteristic of the business-to-business arena.

Key Points

• Low average spend per customer refers to the expenses incurred by each of the customer.
• Since, in a B2B business most of the customers are large and the amount spent over purchase is also high. Thus, a low average is not the feature of the B2B arena.