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Chapter 16Marketing Ethics and Social Responsibility

GENERAL CONTENT: Multiple-Choice Questions

1. The marketing concept is a philosophy of customer satisfaction and _____.a. mutual interestb. mutual gainc. innovationd. needs mete. none of the above

(Answer: b; p. 495; Moderate)

2. You have just read the latest survey about consumers’ attitudes toward current marketing practices. It reveals that consumers in general hold _____ attitudes.a. mixedb. slightly unfavorablec. moderated. A and Be. belligerent

(Answer: d; p. 495; Easy)

3. Many critics charge that the American marketing system causes _____ to be higher than they would be under more “sensible” systems.a. distribution costsb. advertising costsc. pricesd. markupse. employee morals

(Answer: c; p. 496; Moderate)

4. A long-standing charge against intermediaries is that they mark up prices beyond the _____.a. value of their servicesb. delivery chargesc. going market priced. range most Americans can afford to paye. C and D

(Answer: a; p. 496; Easy)

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5. Critics charge that some companies mark up goods excessively. Marketers respond by explaining that most consumer abuses are _____ and that most consumers do not understand the _____ high markups.a. rare; business concepts ofb. unintentional; reasons forc. rare; reasons ford. unintentional; business concepts ofe. none of the above

(Answer: b; p. 496; Easy)

6. Deceptive promotion differs from deceptive pricing in that deceptive promotion overstates the product’s _____ or _____.a. true price; performanceb. features; performancec. packaging; costsd. design; featurese. availability; performance


7. A major step in regulating unfair and deceptive business acts and practices was the creation of the _____ in 1938.a. Robinson-Patman Actb. Wheeler-Lea Actc. Interstate Commerce Commissionsd. Taft-Hartley Acte. Stamp Act


8. Marketers argue that most companies avoid deceptive practices because such practices _____.a. deliver only short-term profitsb. create more competitionc. harm their business in the long rund. are illegale. create long-term negative feelings among consumers


9. Theodore Levitt claims that some advertising puffery is bound to occur and that it may even be desirable. People do not buy _____.a. pure functionalityb. solely because of the situation presented in the adc. emotionallyd. features onlye. B or C

(Answer: a; p. 497; Challenging)

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10. What is the third typical product criticism besides lack of quality and delivers little benefit?a. Priced too high.b. Promotion is deceptive.c. Lacks complete safety.d. Lacks company backing of warranty.e. Bad consumer connotations.

(Answer: c; p. 499; Easy)

11. Consumers Union, the nonprofit testing and information organization, has published _____ to assist the consumer in choosing products to purchase.a. Consumer Digestb. Buyers Weeklyc. Home & Gardend. Consumer Reportse. Sports Illustrated


12. Critics have charged that some companies follow a program of causing their products to need to be replaced before they actually should need replacement. What is this called?a. Product failure.b. Short-term planning.c. Planned obsolescence.d. Nonfunctional warranties.e. Expressed satisfaction.


13. Marketers explain that planned obsolescence is in general not a problem for all of the following reasons except one. Which one?a. Consumers like change.b. No one is forced to buy the new product.c. It will eventually wear out anyway.d. For most technical products, customers want the latest innovations.e. None of the above.


14. The _____ marketing system has been accused of poorly serving disadvantaged consumers.a. European Unionb. Americanc. GATTd. WTOe. NAFTA


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15. A Consumers Union study found that the _____ pay more for inferior goods.a. wealthyb. uneducatedc. poord. Jewse. Asian Americans


16. A Consumers Union study suggested that the presence of _____ in low-income neighborhoods made a big difference in keeping prices down.a. supermarketsb. super centersc. discount storesd. large national chain storese. factory outlets

(Answer: d; p. 502; Moderate)

17. A type of economic discrimination in which major chain retailers avoid placing stores in disadvantaged neighborhoods is called _____.a. embargob. licensingc. redliningd. tariffe. scrambled merchandise


18. The American marketing system has been accused of adding to several “evils” in American society at large. These untrue criticisms include _____. a. creating false wantsb. creating excessive materialism c. promoting too few social goodsd. creating cultural pollutione. all of the above

(Answer: e; p. 503; Easy)

19. Critics have charged that the marketing system urges too much interest in _____.a. material possessionsb. the push strategyc. meeting a quotad. new product inventione. entering the global market arena


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20. Critics of the American economic marketing system have charged that people are judged by what they _____.a. areb. ownc. do d. eate. avoid


21. A drive for wealth and possessions hit new highs in the _____, when phrases such as “greed is good” and “shop till you drop” seemed to characterize the times.a. 1950sb. 1960sc. 1980sd. 1990se. C and D

(Answer: e; p. 503; Moderate)

22. In the new millennium, social scientists have noted a _____.a. stronger infatuation with material thingsb. strong need to buyc. reaction against wasted. A and Be. none of the above


23. _____ products give high immediate satisfaction but may hurt consumers in the long run. a. Environmentalb. Deficientc. Pleasingd. Salutarye. Desirable

(Answer: c; p. 516; Challenging)

24. _____ products have low appeal but may benefit consumerism in the long run. a. Environmentalb. Deficient c. Pleasingd. Salutarye. Desirable


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25. The critics do not view this interest in material things as _____.a. a natural state of mindb. hurting societyc. helping societyd. A and Ce. necessary


26. _____ is hired to use mass media to create materialistic models of the good life. a. Straight product extendersb. Albertsonsc. Madison Avenued. Fifth Avenuee. Michigan Avenue


27. When Madison Avenue steps in, critics say marketing is seen as benefiting _____ more than _____.a. consumers; industryb. industry; consumersc. stores; manufacturersd. managers; storese. children; adults


28. Marketers are most effective when they appeal to _____ rather than when they _____.a. exciting new inventions; use old onesb. teenagers; target older peoplec. existing wants; attempt to create new onesd. emotions; appeal to actual needse. the mass market; appeal to market segments


29. People seek information when making important purchases and often _____.a. do not rely on television adsb. change their mindsc. rely on their relatives’ adviced. do not rely on single sourcese. avoid their parents in doing so


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30. The high failure rate of new products shows that companies are not able to _____.a. control demandb. advertise enoughc. find manufacturersd. find outletse. none of the above


31. On a deeper level, our wants and values are influenced not only by marketers but also by _____.a. familyb. peer groupsc. ethnic backgroundd. religione. all of the above


32. The overselling of private goods results in _____, such as cars causing traffic jams, air pollution, injuries, and deaths.a. wasteb. misdirected fundingc. social costsd. materialisme. opportunity costs


33. A major way to reverse the cultural pollution caused by marketing is to adjust _____.a. product selectionb. advertisingc. product positioningd. consumer attitudese. the morale level


34. A practice that can be used to combat the criticism that competition is reduced and firms are harmed when companies expand by acquiring competitors is to _____ instead.a. expand into new marketsb. develop their own new productsc. export mored. enter into foreign joint venturese. focus solely on a single product

(Answer: b; p. 506; Challenging)

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35. The two major movements to keep business in line are environmentalism and _____.a. consumerismb. protectionismc. antimonopoly legislationd. regulating interstate commercee. none of the above


36. The first organized consumer movement in the United States took place in the early 1900s. It was fueled by all of the following conditions except one. Which one?a. Rising prices.b. Conditions in the meat industry.c. Unsafe products.d. Scandals in the drug industry.e. B and D


37. _____ is an organized movement of citizens and government agencies to improve the rights and power of buyers in relation to sellers.a. Environmentalismb. The Bill of Rightsc. Grassroots politicsd. Consumerisme. The Human Relations Movement


38. Many people believe that the balance of power in consumerism lies on the seller’s side. Critics believe that buyers have too little education, protection, and _____ to make wise decisions when facing sophisticated sellers.a. moneyb. informationc. skillsd. bargaining powere. credit


39. Consumer advocates call for which of the following additional consumer rights? a. The right to be well informed about important product aspects.b. The right to be protected against questionable products and marketing practices.c. The right to influence products and marketing practices in ways that will improve

the quality of life.d. All of the above.e. None of the above.

(Answer: d; p. 507; Challenging)

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40. _____ is a management approach that involves developing strategies that both sustain the environment and produce profits for the company. a. Consumerismb. Environmentalismc. Environmental sustainabilityd. Social responsibilitye. Ethical decision making


41. Environmentalists assert that the marketing system’s goal should be to maximize _____.a. consumer protectionb. protection of the environmentc. the quality of lifed. efficient use of our resourcese. the welcoming of diversity


42. The challenge of developing an economy that the planet is capable of supporting indefinitely is referred to as _____.a. sustainable global economyb. long-term sustainabilityc. new world order economyd. environmental sustainabilitye. green marketing


43. Companies emphasizing prevention of pollution have developed “green marketing” programs that develop _____.a. ecologically safer productsb. recyclable and biodegradable packagingc. more energy-efficient operationsd. a concern for naturee. all of the above


44. Design for environment (DFE) involves thinking ahead in the design stage to create products that are easier to reuse, recycle, or _____.a. disintegrateb. resellc. recoverd. exporte. store


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45. What do most companies today focus on when it comes to protecting the environment?a. Investing heavily in pollution prevention.b. Practicing product stewardship.c. Developing a sustainable vision.d. Investing heavily in environmental technology.e. Biodegradability.

(Answer: a; p. 512; Moderate)

46. As international trade barriers come down and global markets expand, environmental issues are having _____ impact on international trade.a. a neutralb. the samec. a lowerd. a greatere. more impact on cultural differences among people and less


47. Uniform worldwide environmental standards are not expected to be put into place soon because _____.a. such strategies are too expensiveb. many countries do not recognize the importance of environmental standardsc. such policies currently vary too widely between countriesd. markets are too dissimilar e. C and D


48. Citizen concerns about marketing practices will usually lead to public attention and _____.a. debatesb. legislative proposalsc. workable lawsd. all of the abovee. none of the above


49. The philosophy of _____ holds that a company’s marketing should support the best long-run performance of the marketing system.a. corporate social responsibilityb. marketing sustainabilityc. enlightened marketingd. the free enterprise systeme. NAFTA


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50. When an enlightened company makes marketing decisions by considering consumers’ wants and interests, the company’s requirements, and _____ long-run interests, it is practicing ______ marketing.a. the federal government’s; valueb. society’s; societalc. society’s; sense-of-missiond. society’s; valuee. employees’; green


51. What are deficient products?a. Products that have neither immediate appeal nor long-run benefits.b. Products that give high immediate satisfaction but only hurt consumers in the long

run.c. Products that have low appeal but may benefit consumers in the long run.d. Products that are either unsafe or inferior.e. Any product in the decline stage of the product life cycle.

(Answer: a; p. 516; Challenging)

52. When a company makes products that give high immediate satisfaction but may hurt consumers in the long run, they are called _____.a. deficientb. pleasingc. salutaryd. desirablee. threatening


53. The ideal goal for all companies to have for their products and society should be to turn all of them into _____.a. salutary onesb. desirable onesc. pleasing onesd. durable onese. serviceable ones


54. The challenge for their product is to add long-run benefits without reducing the product’s pleasing qualities. What kind of product is it?a. Salutary.b. Desirable.c. Pleasing.d. Durable.e. None of the above.


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55. The challenge for this product is to add some pleasing qualities so that it will become more desirable in the consumers’ minds. What is it called?a. Salutary.b. Desirable.c. Pleasing.d. Durable.e. Aesthetic.


56. Companies must decide upon what principle they should use as a guide on issues of ethics and social responsibility. Which one of the following is not a common philosophy to accomplish this end?a. Let the free market decide.b. Let the legal system decide.c. Let society decide.d. Let individual managers or companies decides.e. A and B


57. It is important to make a commitment to a common set of shared standards worldwide for the sake of _____.a. customersb. suppliersc. employeesd. our posteritye. all of the company’s stakeholders


58. The American Marketing Association (AMA) has created a code of ethics that includes three of these four topics. Which on is incorrect?a. Honesty.b. Fairness.c. Not knowingly doing harm.d. Limit selling or fundraising during research.e. None of the above.


59. Ethics and social responsibility require a _____.a. futuristic approachb. total corporate commitmentc. separate budgetd. time commitment that most firms do not havee. lot of money to implement


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60. Ethics and social responsibility must be a component of the _____.a. mission statementb. value statementc. competencies statementd. overall corporate culturee. NAFTA agreement


61. Critics charge that _____.a. there are not enough intermediariesb. intermediaries are inefficientc. intermediaries provide only necessary servicesd. intermediaries underprice their servicese. C and D


62. Most businesses try to deal fairly with consumers because _____.a. businesses want to build customer relationshipsb. businesses want to justify their pricesc. businesses want repeat businessd. all of the abovee. A and C


63. Deceptive practices fall into three groups: deceptive _____, deceptive_____, and deceptive _____.a. product; pricing; promotionb. pricing; promotion; placementc. pricing; promotion; packagingd. packaging; product; promotione. product; packaging; placement


64. Planned obsolescence may involve _____.a. producers’ continually changing consumer stylesb. the holding back of attractive functional features, then introducing them later to

make older models obsoletec. the use of material that will rust sooner than they shouldd. the use of components that will break soon after purchasee. all of the above

(Answer: e; pp. 499–500; Easy)

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65. For cars, “social costs” may include _____.a. traffic congestionb. air pollutionc. gasoline shortagesd. A and Be. all of the above


66. Cultural pollution could be referred to as _____.a. commercial noiseb. air pollutionc. language barriersd. a marketer’s inability to identify a target markete. zipping or zapping


67. Critics charge that a company’s marketing practices can harm other companies and reduce competition among companies. Problems involved include all of the following except _____.a. acquisitions of competitorsb. marketing practices that create barriers to entryc. marketing practices that confuse consumersd. unfair competitive marketing practicese. B and D


68. Two major grassroots movements that have arisen to keep business in line include _____ and _____.a. consumerism; ethnocentrismb. consumerism; environmentalismc. industrialization; environmentalismd. perennialism; favoritisme. consumerism; hooliganism


69. Environmentalism is an organized movement of concerned _____ to protect people’s living environment.a. citizensb. businessesc. government agenciesd. all of the abovee. none of the above


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70. Environmental sustainability includes _____.a. protecting the environmentb. extracting environmental materials to their lowest levelsc. producing profitsd. A and Ce. A, B, and C


71. Minimizing pollution from production and all environmental impacts throughout the full product life cycle is called _____.a. green marketingb. design for environment (DFE)c. product stewardshipd. environmental sustainabilitye. pollution prevention


72. “Green marketing” includes _____.a. making safer productsb. recyclingc. biodegradabilityd. pollution controlse. all of the above


73. Innovative marketing is _____.a. a principle of enlightened marketingb. based on the consumer’s point of viewc. the attempt to continuously seek product and marketing improvementsd. A and Ce. A, B, and C


74. The best examples of pleasing products include _____.a. cigarettes and junk foodb. dental services and medicationsc. seat belts and air bagsd. fruits and vegetablese. none of the above


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75. Desirable products may include _____.a. healthy breakfast foodb. front-loading washing machinesc. compact fluorescent light bulbsd. all of the abovee. none of the above


True/False

76. The major criticisms of marketing include harming consumers through high prices, deceptive practices, high-pressure selling, shoddy or unsafe products, planned obsolescence, and poor service to disadvantaged countries.

(True; p. 496; Moderate)

77. When responding to consumer complaints about high prices, marketers often explain that consumers do not understand the costs involved that justify the prices.

(True; p. 496; Easy)

78. Marketers argue that most companies avoid deceptive practices because such practices harm their business in the long run.


79. Jones Toy Company has been accused of producing shoddy and unsafe children’s toys. If Jones is typical of most companies, the complaints will center around manufacturer indifference, increased production complexity, poorly trained labor, and poor quality materials.

(False; p. 498; Challenging)

80. With customer-value marketing, the company should put most of its resources into customer value-building marketing investments.


81. There are two forms of product obsolescence. One results from a product becoming obsolete before it needs replacement. The other results form a company holding back attractive functional features of a product, then introducing them later to make older products obsolete.


82. A recent Consumer Union study suggests that the poor pay more for superior goods.(False; p. 502; Easy)

83. Two common accusations aimed at consumer advertising are that it is full of lies and that it makes you buy things you don’t need.


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84. Critics of marketing view consumer interest in material things as a natural state of mind and a matter of false wants created by marketing.

(False; p. 503; Easy)

85. The major reason that marketers have been accused of overselling private goods at the expense of public goods is because they require more public services that are usually not forthcoming.


86. American industries do not promote but do protect their own interests. Therefore, they cannot be accused of wielding too much political power.

(False; p. 505; Moderate)

87. Consumerism did not originate with Ralph Nader. Its early beginnings were fueled by rising prices, conditions in the meat industry, and scandals in the drug industry beginning in the early 1930s.


88. Each basic consumer right has led to more specific proposals and laws fueled by consumers.


89. Environmentalism has led the way for developing the strategy of environmental sustainability, resulting in new ways to sustain the environment and allowing companies to make a profit at the same time.


90. In the progress toward environmental sustainability, a company strives for the first level of pollution prevention followed by product stewardship.


91. Environmentalism creates some special challenges for global marketers. The problem with doing business with countries such as Denmark and Germany is that they are only in the beginning stages of policy formulation.


92. Citizen concerns about marketing practices will usually lead to public attention and legislative proposals, such as debating over new bills that will be defeated, modified, or made into law.


93. Enlightened marketing consists of five principles: consumer-oriented, innovative, value, sense-of-mission, and societal marketing.


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94. When a company views and organizes its marketing activities from only the consumer’s point of view, it is practicing societal marketing.


95. New World Food Supplements continuously seeks real product and marketing improvements. Obviously, New World is involved in consumer-oriented marketing.


96. You are listening to the 10 o’ clock news. The newscaster is telling about a company that makes marketing decisions by considering consumers’ wants and long-run interests, the company’s requirements, and society’s long-run interest. The company must be practicing consumer-oriented marketing.


97. Sunset Lawn Service puts most of its resources into value-building marketing investments. The management at Sunset is practicing customer-value marketing.


98. A societally oriented marketer wants to develop products that are not only pleasing but also beneficial to consumers. Marketers produce pleasing products when they have low appeal but may benefit consumers in the long run.


99. Seatbelts are considered to be salutary products. (True; p. 516; Moderate)

100. Xorbate Blue is a relatively new food supplement that has given both high immediate satisfaction and high long-run benefits. Its industry identifies it as a pleasing product.


101. Conscientious marketers face many moral dilemmas. After gathering the data, the best thing to do is often unclear rather than obvious.


102. Two common philosophies that guide a company in choosing what principle to follow on issues of ethics and social responsibility include let the free market and legal system decide, and secondly, let individual mangers and companies choose.

(True; p. 517; Challenging)

103. The finest guidelines can generally be relied upon to resolve all the difficult ethical situations that marketers face.


104. It is important for an international marketer to develop a common set of shared standards worldwide for use in all of its markets.

(True; pp. 518–519; Easy)

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105. In sense-of-mission marketing, a company defines its mission in broad social terms rather than narrow product terms.


Essay

106. What are the ways marketing is accused of harming the consumer?

Marketers are charged with causing prices to be higher than they need to be. They are sometimes accused of deceptive practices that lead consumers to believe they will get more value than they actually do. Sometimes salespeople pressure consumers to purchase products they neither want nor can afford. Others are accused of selling shoddy or unsafe products. Others are blamed for developing products that become obsolete before they actually need replacement. Last, marketers are accused of delivering poor service to disadvantaged consumers or not making products available to them.

(p. 496; Moderate)

107. Identify the major social criticisms of marketing.

Marketing’s impact on society has been criticized for creating false wants and too much materialism, too few social goods, cultural pollution, and too much political power. Critics have also criticized marketing’s impact on other business for harming competitors and reducing competition through acquisitions, practices that create barriers to entry, and unfair competitive marketing practices.

(p. 503; Challenging)

108. How do consumerism and environmentalism affect marketing strategies?

Alert marketers view consumerism as an opportunity to serve consumers better by providing more consumer information, education, and protection. Environmental groups have improved conditions in many industries, including the meat and drug industries, and have helped pass legislation to protect the environment. The latest move is for companies to be proactive and take the responsibility for not doing environmental harm. They are practicing environmental sustainability by developing strategies that both sustain the environment and produce profits for the company.

(pp. 507–508; Moderate)

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109. Compare and contrast the five forms of enlightened marketing.

Consumer-oriented marketing acts from the consumers’ point of view. Innovative marketing seeks real product and marketing improvements. Consumer-value marketing exists when a firm puts most of its resources into value-building investments. When a company defines its mission in broad social terms rather than narrow product terms, it is practicing sense-of-mission marketing. Lastly, the pinnacle, or societal marketing, exists when the company makes its decisions by considering consumers, itself, and society’s long-run interests.

(pp. 513;–516 Challenging)

110. How do the four types of products in the societal classification of products stack up against each other?

Deficient products are at the bottom because they have neither immediate appeal nor long-run benefits. Desirable products are at the top because they give both high immediate satisfaction and high long-run benefits. In between are pleasing products that give high immediate satisfaction but may hurt consumers in the long run. And we also find salutary products that have low appeal but may benefit consumers in the long run.

(p. 516; Moderate)

111. What can conscientious marketers do to act ethically when faced by ethical dilemmas?

Companies can develop corporate marketing ethics policies to provide broad guidelines for everyone in the organization to follow. They should cover distributor relations, advertising standards, customer service, pricing product development, and general ethical standards. They must develop a set of principles that will help them figure out the moral importance and implications of each situation and decide how far they can go in good conscience.


112. Explain some basics that international marketers can follow to act ethically?

It is important to make a commitment to a common set of shared standards worldwide. Management must decide what to do about bribery and kickbacks. All stakeholders must be considered in all designs. Management must decide if its standards should be lowered in countries with existing low standards in order to compete effectively. In general, it is better to act more ethically than less ethically.

(p. 519; Easy)

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113. Define consumerism and environmentalism strategies.

Consumerism is an organized social movement intended to strengthen the rights and power of consumers relative to sellers. Alert marketers view it as an opportunity to serve consumers better by providing more consumer information, education, and protection. Environmentalism is an organized social movement seeking to minimize the harm done to the environment and quality of life by marketing practices.

(pp. 507–508; Easy)

114. Describe the principles of socially responsible marketing.

Many companies originally opposed these social movements and laws, but most of them now recognize a need for positive consumer information, education, and protection. Some companies have followed a policy of enlightened marketing, which holds that a company’s marketing should support the best long-run performance of the marketing system. Enlightened marketing consists of five principles: consumer-oriented marketing, innovative marketing, customer-value marketing, sense-of-mission marketing, and societal marketing.

(p. 513; Moderate)

115. Explain the role of ethics in marketing.

Increasingly, companies are responding to the need to provide company policies and guidelines to help their managers deal with questions of marketing ethics. Of course even the best guidelines cannot resolve all the difficult ethical decisions that individuals and firms must make. But there are some principles that marketers can choose among. One principle states that such issues should be decided by the free market and legal system. A second, and more enlightened principle, puts responsibility not in the system but in the hands of individual companies and managers. Each firm and marketing manager must work out a philosophy of socially responsible and ethical behavior. Under the societal marketing concept, managers must look beyond what is legal and allowable and develop standards based on personal integrity, corporate conscience, and long-term consumer welfare.

(p. 517; Moderate)

APPLICATION CONTENT: Multiple-Choice Questions

116. If Jolene Cosmetics is typical of consumer attacks, it will be accused of pushing up prices to finance _____.a. rising employee benefitsb. heavy advertising and sales promotion costsc. rising gasoline prices that affect distributiond. inflationary costs of doing businesse. none of the above


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117. A heavily promoted brand of flu medicine sells for much more than a virtually identical nonbranded or store-branded product. Critics charge that promotion adds only _____ to the products rather than functional value.a. costsb. strengthc. psychological valued. popularitye. market image


118. The sales force at Tom Dennis Ford dealership knows that using high-pressure selling does not work if the firm wants to _____.a. surviveb. stay competitivec. obey local and federal lawd. build long-term relationships with customerse. maintain a database


119. At this point in your career, you work for a major tobacco company. Recently, your company has received numerous critical letters stating that it wields too much _____ power.a. economicb. politicalc. sociald. legale. all of the above

(Answer: e; p. 505; Challenging)

120. Critics charge that a company’s marketing practices can harm other companies and reduce competition. Which of the following list the one item that is not a problem regarding this?a. Acquisition of competitors.b. Marketing practices that create barriers to entry.c. Unfair competitive marketing practices.d. Offering more value for less price.e. None of the above.


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121. At the second level of sustaining the environment, companies can minimize not just pollution from production, but all environmental impacts throughout the full product life cycle. What is this practice called?a. Design for environment.b. Product stewardship.c. Corporate accountability.d. Social responsibility.e. Green marketing.


122. Xavier Rentals, Inc., is now looking into the future and working on the third level of environmental sustainability called _____.a. sustainable visionb. new environmental technologiesc. corporate citizenshipd. computer-enhanced environmental controle. none of the above


123. This form of enlightened marketing requires that a company seek real product and marketing improvements.a. Consumer oriented.b. Innovative.c. Value.d. Sense-of-mission.e. Market oriented.


124. Jacob Engineering Group views and organizes its marketing activities from the viewpoint of its buyers. Management works hard to sense, serve, and satisfy the needs of its well-defined group of buyers. What do they practice?a. Consumer-oriented marketing.b. Societal marketing.c. Sense-of-mission marketing.d. Value marketing.e. Marketing intelligence.


125. Some firms define their purpose in narrow product terms. Others that define their company’s purpose in broad social terms follow _____.a. societal marketingb. sense-of-mission marketingc. consumer-oriented marketingd. value marketinge. none of the above


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126. When Hancock & Dunberry developed new simplified wills for the elderly and less educated markets, less expensive home visits, and a free statewide legal referral service, the law firm began practicing _____ marketing.a. consumer-oriented b. innovativec. valued. societale. home-based


127. In recent years, Colgate Company’s new product sales in the United States are 58 percent of total sales, while in foreign markets they account or 35 percent of sales. What type of marketing has Colgate been using recently?a. Consumer-oriented.b. Value.c. Innovative.d. Societal.e. Home-based,


128. Baker Enterprises produces several new products that have low appeal but may benefit consumers in the long run. How would you classify these products?a. Deficient.b. Pleasing.c. Salutary.d. Desirable.e. Unpleasing.


129. Monica Carey is a conscientious marketing manager. Sometimes it is unclear what decisions to make when she and her staff are faced with moral dilemmas. Monica could create broad guidelines that everyone in the organization could follow to develop moral sensitivity in the form of _____.a. a company value statementb. a company mission statementc. a company vision statementd. corporate marketing ethics policiese. a financial statement

(Answer: d; p. 517; Challenging)

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130. One major issue in foreign trade is bribery. The most flagrant bribe-paying firms found in one recent study are located in all of these countries except _____.a. Russiab. Chinac. South Koread. Austriae. none of the above


131. Albatross Enterprises was accused of deceptive pricing. Which of the following explains what might have happened?a. Albatross refused to advertise sale prices in the local paper.b. Albatross lured customers to the store for a bargain that is out of stock.c. Albatross advertised a large price reduction from a phony high retail list price.d. Albatross misrepresented a product’s features in an ad.e. Any of the above.


132. Hart’s Department Store was accused of deceptive promotion. Which of the following explains what might have happened?a. Hart’s refused to advertise sale prices in the local paper.b. Hart’s lured customers to the store for a bargain that is out of stock.c. Hart’s advertised a large price reduction from a phony high retail list price.d. Hart’s misrepresented a product’s features in an advertisement.e. B and D


133. Which of the following situations might be considered “puffery”?a. Mr. Clean coming to a housewife’s rescue.b. Toned thighs and legs as a result of using the Thigh Master for only 15 minutes

each day.c. Children growing into attractive adults as a result of drinking milk.d. None of the above.e. A, B, or C

(Answer: e; p. 497; Challenging)

134. When ABC, Inc., worked to design products that are easier to reuse or recycle, ABC was adopting _____.a. pollution preventionb. green marketingc. product stewardshipd. design for environment (DFE) practicese. new environmental technologies


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135. Maytag’s front-loading Neptune washer provides superior cleaning and energy efficiency. The Neptune washer is an example of a _____ product.a. deficientb. pleasingc. salutaryd. desirablee. satisfying


Short Answer

136. Define deceptive pricing.

Deceptive pricing includes practices such as falsely advertising factory or wholesale prices or a large price reduction from a phony high retail list price.

(p. 497; Easy)

137. Define deceptive promotion.

Deceptive promotion includes practices such as misrepresenting the product’s features or performance or luring customers to the store for a bargain that is out of stock.

(p. 497; Easy)

138. Define deceptive packaging.

Deceptive packaging includes exaggerating package contents through subtle design, using misleading labeling, or describing size in misleading terms.

(p. 497; Easy)

139. What is meant by redlining?

Redlining is a type of economic discrimination in which major chain retailers avoid placing stores in disadvantaged neighborhoods.

(p. 502; Moderate)

140. What is meant by cultural pollution?

Cultural pollution is “commercial noise,” in which our senses are constantly being assaulted by advertising. Examples include: commercials that interrupt serious programs, pages of ads that obscure magazine, and billboards that mar beautiful scenery.

(p. 505; Moderate)

494

141. Define consumerism.

Consumerism is an organized movement of citizens and government agencies to improve the rights and power of buyers in relation to sellers.

(p. 507; Easy)

142. Define environmentalism.

Environmentalism is an organized movement of concerned citizens, businesses, and government agencies to protect and improve people’s living environment.

(p. 508; Easy)

143. How does environmentalism contribute to “life quality”?

“Life quality” means not only the quantity and quality of consumer goods and services, but also the quality of the environment; environmentalists want environ-mental costs included in both producer and consumer decision making.


144. Is environmental sustainability possible? Explain.

Environmental sustainability involves the development of strategies that both sustain the environment and produce profits for the firm. In some cases, environmental sustainability may not be totally achievable but it is something worth striving for.


145. What is involved in pollution prevention?

Pollution prevention means more than pollution control—or the cleaning up of waste after it has been created. It involves the elimination or minimization of waste before it is created.

(p. 509; Moderate)

146. Define green marketing.

Green marketing programs involve the development of ecologically safer products, recyclable and biodegradable packaging, and better pollution-control standards.

(p. 509; Easy)

147. How do design for environment (DFE) practices relate to product stewardship?

DFE practices involve thinking ahead to design products that are easier to recover, reuse, or recycle; these practices are a part of product stewardship.

(p. 509; Moderate)

495

148. What types of firms adopt sustainability visions?

Such firms use this vision as a guide to the future; a sustainability vision shows how the company’s products and services, processes, and policies must evolve and what new technologies must be developed to get there.


149. Why is environmentalism especially challenging for global marketers?

As international barriers come down and global marketers expand, environmental issues are having an even greater impact on international trade; different environ-mental standards between and among various countries make environmentalism especially challenging.

(p. 512; Moderate)

150. Define enlightened marketing.

Enlightened marketing holds that a company’s marketing should support the best long-run performance of the marketing system. Enlightened marketing consists of consumer-oriented marketing, innovative marketing, value marketing, sense-of-mission marketing, and societal marketing.


151. Define consumer-oriented marketing.

Consumer-oriented marketing means that the company should view and organize its marketing activities from the consumer’s point of view. The company should work to sense, serve, and satisfy the needs of a defined group of consumers.


152. How does a firm benefit from innovative marketing?

Innovative marketing requires that the company continuously seek real product and marketing improvements. This is an extremely proactive approach in which the marketer attempts to stay ahead of competitors.


153. Explain the role of sense-of-mission marketing.

Sense-of-mission marketing means that the company should define its mission in broad social terms rather than narrow product terms; when a company defines a social mission, employees feel better about their work and have a clearer sense of direction.


496

154. What is the difference between deficient products and pleasing products?

Deficient products have neither immediate appeal nor long-run benefits; pleasing products, on the other hand, give high immediate satisfaction but may hurt consumers in the long run.

(p. 516; Easy)

155. What is the difference between salutary products and desirable products?

Salutary products have low appeal but may benefit consumers in the long run; whereas, desirable products give both high immediate satisfaction and high long-run benefits.

(p. 516; Easy)

Scenario

Donald Eagle acquired Benning’s at a low point. The distributor of automotive parts and accessories had been criticized for a number of wrongdoings. Without fully realizing the extent of Benning’s problems, Mr. Eagle purchased the distributorship in hopes of turning it around. “But the harder I work,” Mr. Eagle admitted, “the more Benning’s earlier problems seem to unfold.”

Donald Eagle began to rethink his strategy, trying to put a sound plan in place that would allow Benning’s to move forward.

156. According to various possibilities highlighted in the textbook, in what ways might this marketer have previously “harmed” consumers?

Benning’s could have charged exorbitantly high prices, engaged in deceptive practices or high-pressure selling, sold shoddy or unsafe products, or provided poor service to disadvantaged consumers.

(pp. 495–496; Easy)

157. Assume that Benning’s previously engaged in deceptive promotion. How could this marketer have avoided deceptive promotion?

For example, Benning’s could have represented their products’ features as honestly as possible and avoided luring customers to the store for a bargain that was out of stock or may not have existed.

(p. 497; Moderate)

497

158. How could have obsolescence strategies carried out by this distributor’s suppliers have harmed Benning’s?

Benning’s could have been left with excess inventory in the event that Benning’s was not made aware of the obsolescence plan. In addition, Benning’s could have suffered from an image standpoint; disgruntled customers may have blamed Benning’s merely because the firm is a player in the supply chain.


159. What possible “social costs” may have previously been associated with Benning’s?

Benning’s may have oversold “private goods” with a lack of public services to accommodate the sales. For example, Benning’s automotive parts sales may not have focused on safety features, efficient engines, or pollution control.


160. If this marketer were to adopt a policy of environmental sustainability, on what would its focus be?

Benning’s could focus on pollution prevention, green marketing, product stewardship, DFE practices, and new environmental technologies.

(p. 509; Moderate)

161. Might product stewardship be a major focus for Benning’s? Explain.

Yes, contrary to any costs involved, Benning’s could work to minimize not just pollution from production, for example, but all environmental impacts throughout the full product life cycle.

(p. 509; Easy)

162. With a consumer-oriented marketing plan, what would be Benning’s primary focus?

Consumer-oriented marketing would allow Benning’s to view and organize its marketing activities from the consumers’ points of view; Benning’s can work to deliver superior value to carefully chosen customers.

(p. 513; Moderate)

163. Explain how this marketer’s mission may change under a sense-of-mission marketing approach.

Sense-of-mission marketing would allow Benning’s to define its mission in broad social terms instead of narrow product terms; based on the negative image of Benning’s in the marketplace, such a strategy will take time.


498

164. Describe any deficient or pleasing product types likely associated with this marketer.

Deficient products are those that have neither immediate appeal nor long-run benefits; pleasing products give high immediate satisfaction but may hurt consumers in the long run.

(p. 516; Easy)

165. Describe any salutary or desirable product types likely associated with this marketer.

Salutary products have low appeal but may benefit consumers in the long run; desirable products give high immediate satisfaction and high long-run benefits.

(p. 516; Easy)

499

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