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Chapter 14 - Direct Marketing

Chapter 14

Direct Marketing

True / False Questions

1. Direct marketing is synonymous to direct-marketing media. True False

2. The increase in the "money rich and time poor" people in the world have led to the success of direct marketing. True False

3. It is not possible to generate a behavioral response by relying solely on direct marketing. True False

4. Direct marketing activities are supported by the other elements of the promotional mix. True False

5. Direct marketing is a form of advertising. True False

6. Both direct marketing and advertising could support one another. True False

7. Telemarketing and direct selling are two methods of personal selling used to generate sales. True False

8. The main objective of direct marketing is to seek a direct response. True False

9. The one and only objective of direct marketing is to obtain a direct behavioral response. True False

10. For CRM to work effectively, a database is required. True False

11. Ideally, collecting names and information about customers is sufficient in order to maintain and utilize a database effectively. True False

12. In the two step approach to direct marketing, the first effort generates the sales and the second effort reduces the post purchase dissonance. True False

13. Direct marketing is restricted to small companies seeking business. True False

14. Keys to the success of direct mail are the mailing lists. True False

15. Direct response advertising employs only the one step approach in order to solicit a sales response. True False

16. By running the same ad on different stations, a direct marketer can determine the relative effectiveness of the medium. True False

17. One disadvantage of direct marketing is that it results in a lot of waste coverage. True False

18. The program vehicles used for direct-response TV advertising are usually very expensive. Hence, the marketer cannot afford to purchase repeat times. True False

Multiple Choice Questions

19. Direct marketing: A. is not a useful tool for a company that is using an integrated marketing communications plan. B. seeks the same objectives as advertising, sales promotion, and personal selling strategies in an IMC plan. C. is one of the slowest growing forms of promotion in terms of dollar expenditures. D. can generate immediate behavioral response. E. cannot be combined with other forms of promotional media.

20. Unlike traditional marketing, the typical goal of direct marketing is to: A. create brand image. B. generate an immediate behavioral response. C. utilize telephone communication exclusively. D. create awareness. E. convey detailed information.

21. _____ is a system of marketing by which organizations communicate directly with target customers to generate a response or transaction. A. Sales promotion B. Word-of-mouth marketing C. Synchro marketing D. Direct marketing E. Publicity

22. Direct marketing response can take the form of: A. an inquiry. B. awareness. C. knowledge about the product. D. sales promotion. E. push promotional strategy.

23. Which of the following promotional media create an immediate response in the form of an inquiry, a purchase or even a vote? A. Trade advertising B. Publicity C. Public relations D. Direct marketing E. Synchro marketing

24. Which of the following is an example of direct-response media? A. Billboards B. Place-based media C. The Internet D. Product placement E. Guerrilla media

25. _____ are tools by which direct marketers implement the communications process. A. Databases B. Sweeps C. Direct-response media D. Promotional push strategies E. Encoders

26. Which of the following statements is true about direct marketing? A. Direct marketing is suitable only for consumer-to-consumer advertising. B. Direct response media includes interactive TV and print media. C. Direct marketing is not popular among industrial marketers. D. Direct marketing as a promotional media is suitable only for small retailers. E. Rapid increase in dual income families in America has led to a reduction in the use of direct marketing as a promotional media.

27. The major impetus behind the growth of direct marketing was the: A. increase in the number of working women. B. invention of the printing press. C. development and expansion of the U.S. Postal Service. D. development of multinational companies and international markets. E. law that mandated public education.

28. One of the reasons for the recent, rapid growth of direct marketing in American society is due to the: A. the fact the U.S. has moved from an industrialized nation to a service nation. B. increase in the number of hours individuals spend watching television. C. proliferation of cellular phones. D. increased use of consumer credit cards. E. development of four-color printing presses.

29. Which of the following statements is true about the growth of direct marketing? A. Direct marketing is being used as a promotional media only after the invention of Internet. B. All the purchases being made with the use of credit cards are as a result of direct marketing. C. One of the major factors contributing to the success of direct marketing is that so many Americans are now ‘time rich and money poor'. D. Increase in poverty has led to a rapid increase in direct marketing. E. The rapid technological advancement of the electronic media and the Internet has led to growth in direct marketing.

30. A magazine ad for pet health insurance contains both a toll-free number to call and a Web site to visit for more information. This ad is an example of the combining of direct marketing with: A. a trade promotion. B. public relations. C. advertising. D. personal selling. E. consumer promotion.

31. _____ was known as the stepchild of the promotional mix. A. Advertising B. Direct marketing C. Sales promotion D. Public relations E. Publicity

32. The print ad of ‘Fedex' read ‘Call 1-800-FEDEX (toll free) to send gifts this Christmas to your loved ones anywhere in the world'. This print ad uses direct marketing combined with which of the following promotional media? A. Advertising B. Sales promotion C. Publicity D. Public relations E. Personal selling

33. Joy receives print ads from ‘HP' marketing their ink cartridges to him as it is seen that he is a regular buyer of HP ink cartridges. ‘HP' is making use of which of the following combination of promotional mix? A. Advertising and sales promotion B. Direct marketing and advertising C. Sales promotion and public relations D. Direct marketing and sales promotion E. Public relations and support media

34. OASIS, a charitable foundation, makes use of telemarketing for soliciting funds for charities that go towards child education. This is an example of the use of direct marketing along with: A. advertising. B. sales promotion. C. informercials. D. public relations. E. support media.

35. Telemarketing and _____ are two methods of personal selling used to generate sales. A. advertising B. sales promotion C. direct selling D. informercials E. homeshopping

36. Airlines send out mailers or e-mails announcing promotional airfares. Which of the combinations of promotional media do they make use of? A. Advertising and sales promotion B. Advertising and direct marketing C. Sales promotion and direct marketing D. Sales promotion and public relations E. Direct marketing and personal selling

37. A press conference called by the Winchester County Museum informed the public of the need for major repairs to prevent water damage to the museum's collection of primitive paintings. During the conference, the museum representative announced that each family in Winchester County and neighboring counties could expect to receive a donation envelope in the mail within the next few days. This is an example of the combining of direct marketing with: A. a trade promotion. B. public relations. C. advertising. D. personal selling. E. consumer promotion.

38. When the University of Miami has volunteers call its alumni and ask them to make contributions to pay for the remodeling of the administration building, it is an example of the combining of direct marketing with: A. a trade promotion. B. public relations. C. advertising. D. personal selling. E. consumer promotion.

39. Red Bud Florist received a mail with an offer from Aquafoam, a water-soluble foam brick frequently used for arranging fresh flowers. According to the offer, if the owner of Red Bud places an order with Aquafoam, she would be automatically registered to win $10,000 in a customer appreciation contest. This is an example of the combining of direct marketing with: A. a trade promotion. B. public relations. C. advertising. D. personal selling. E. a consumer promotion.

40. To encourage customers to open mail offering them a subscription to Home Companion, the front of the envelope advised there was a gift inside. Inside was an attractively laminated bookmark. This is an example of combining direct marketing with: A. personal selling. B. support media. C. place-based media. D. product placement. E. advertising.

41. Adding a(n) _____ to a direct mailer has proved to increase response rates. A. contest B. promotional product C. informercial D. needledrop E. sweeps period

42. The most common direct marketing objective that is typically expected by companies is: A. to seek a direct response. B. to increase awareness about a product/service. C. to increase knowledge of use of the product. D. to reduce post purchase dissonance. E. to sell the product at a higher price.

43. A direct marketer usually seeks ____. A. to increase the brand image of the organization B. a direct response C. to build awareness of the brand D. increase long term sales E. inform customer about the product

44. The success of a direct-marketing program is in large part tied to the ability to: A. combine advertising with direct marketing. B. do group marketing. C. do homeshopping. D. combine sales promotion with public relations. E. do one - to - one marketing.

45. Direct marketers make use of _____ to segment and target their markets. A. informercials B. sweeps periods C. databases D. TV spots E. junk mails

46. A ____, maintained by direct marketers, contains a listing of current and/or potential customers of the organization. A. informercial B. junk mail C. spot D. database E. response bag

47. Direct marketers make use of database in order to: A. create informercials. B. segment and target their markets. C. position their product or service. D. develop their promotional mix. E. select the direct marketing strategies to be employed.

48. _____ is the use of specific information about individual customers and/or prospects to implement more effective and efficient marketing communications. A. Information mining B. Public relations C. Data warehousing D. A marketing information system (MIS) E. Database marketing

49. The National Geographic Society offers a variety of products to its subscribers through direct marketing. This is an example of: A. cross-selling. B. renewal marketing. C. an unethical business practice. D. membership-based marketing. E. remarketing.

50. With an offer to subscribe to a cooking magazine, Rosina was offered the opportunity to buy a set of cookware, an electric can opener, and a coffee maker that were featured in the publication and selected by the magazine editors as the best value for the money. This is an example of: A. cross-selling. B. renewal marketing. C. an unethical business practice. D. membership-based marketing. E. remarketing.

51. For customer relationship management (CRM) to work effectively, a(n) _____ is required. A. database B. sweepstake C. TV spot D. product list E. informercial

52. One of the main concerns relating to database marketing is: A. its similarity with customer relationship management. B. the invasion of privacy. C. the high actual cost per thousand. D. lack of selectivity. E. waste coverage.

53. DMA, in relation to direct marketing activities, stands for: A. Direct Marketing Advertising. B. Direct Mail Ads. C. Database Marketing Advertisements D. Direct Marketing Association E. Direct Marketing Agency

54. SRDS, a United States organization provides information regarding both consumer and business lists. SRDS stands for: A. Standard Rate Dialling Service. B. Standard Rate and Data Service. C. Standard Rate Direct Source. D. State Residency Direct Service. E. Standard Real Data Source.

55. ____ conducts an annual study of customers who buy at home via mail, telephone, or Internet. It compiles information on total orders placed, types of products purchased, demographics, and purchase satisfaction, among others. A. The U.S census Bureau B. Standard Rate and Data Service (SRDS) C. The U.S Postal Service D. Direct Mail lists and data E. Simmons Market Research Bureau (SMRB)

56. To determine the effectiveness of a database, the U.S. Postal Service recommends an RFM scoring method. The letters RFM stand for: A. recency, frequency and monetary transactions between the company and the customer. B. rate of sales, fixed use fee paid, and markets reached. C. relationship between the company and the customer, frequency of the sale, and monetary transactions between the company and the customer. D. reach, frequency, and markets reached. E. ratio of inquiries to sales, frequency of sales, and market share.

57. _____ is a method of collecting and storing a large amount of regularly updated information about the customers in the database. A. Customer development index B. Focus groups C. Delphi method D. RFM scoring method E. Cost per order method

58. Walmart employs a method of collecting and storing data about their customers in which data is entered each time a purchase is made by the customer. This enables the company to track how recently purchases have been made, how often they are made, and what amounts of money are being spent. This helps it in maintaining better relation with its customers. Which of the following methods of maintaining a database is employed by Walmart? A. Delphi technique B. Cost per order method C. RFM scoring method D. Customer development index E. One step approach

59. The announcer on the television commercial said, "Get your credit card and call now to order the Monster Ballads of Rock & Roll CD." This is an example the _____ direct marketing approach. A. two-step B. group C. one - to - one D. one-step E. three-step

60. In the _____ approach of direct marketing, the medium is used directly to obtain an order. A. one-to-one B. one-to-many C. indirect D. one-step E. two-step

61. All the television commercials and other print ads that urge the customer to pick up the phone and call the toll free number to place an order immediately make use of the _____ approach of direct marketing. A. one-step B. two-step C. one-to-one D. indirect E. telemarketing

62. The goal of the _____ approach of direct marketing is to generate an immediate sale when the ad is shown. A. two-step B. one-step C. RFM scoring D. indirect E. all-in-one

63. The _____ approach of direct marketing involves the use of more than one medium. A. two-step B. one-step C. RFM scoring D. indirect E. all-in-one

64. Under the two-step approach of direct marketing, the first effort is designed to screen or qualify the potential buyers and the second effort: A. generates the response. B. is designed to increase awareness about the product. C. reduces the post purchase dissonance. D. increases knowledge about the use of the product. E. creates interest in the product.

65. Which of the following companies employ a one-step approach to direct marketing? A. The QVC shopping network. B. A magazine subscription service that sends an announcement of an upcoming sweepstakes. C. An ad advising television viewers to watch their mailboxes for a way to earn free calling cards. D. A company asking if a homeowner is interested in an estimate for a vinyl siding. E. An advertisement for band - aid announcing free gifts on purchase of band - aids worth $10 and above.

66. To purchase cookware, music CDs, and exercise videos advertised on television consumers are asked to call a toll-free telephone number. Viewers are instructed to have their credit cards handy when they call to place the order. This form of direct marketing is referred to as: A. outbound telemarketing. B. videotext. C. the one-step approach. D. the two-step approach. E. support marketing.

67. When a direct advertising medium is designed to directly obtain an order, the _____ approach is being used? A. two-step B. indirect C. direct D. one-step E. bulls-eye

68. In direct marketing situations, when it is necessary to screen or qualify potential buyers, it is advisable to use: A. the two-step approach. B. the one-step approach. C. direct mail rather than telemarketing. D. direct-response television. E. SMRB's data on direct marketing purchasers.

69. The two-step approach to direct marketing: A. asks for an immediate sale. B. uses the first contact to screen potential buyers. C. is commonly found in direct sales. D. is followed by a professional sales call. E. is similar to missionary selling.

70. A television commercial in which Publishers Clearing House urges consumers to look in their mailboxes for soon-to-arrive sweepstakes entries is an example of: A. sweeps marketing. B. add-on marketing. C. specialty advertising. D. the one-step approach to direct marketing. E. the two-step approach to direct marketing.

71. _____ is often called the ‘junk mail'. A. Sweepstake B. Informercial C. TV spot D. Direct mail E. Database marketing

72. Market segmentation in the direct marketing industry: A. is not a viable strategy. B. is used effectively by only a few large companies. C. is considered less efficient than mass mailings. D. is directly tied to the mailing list. E. is unnecessary because demographic and geographic selectivity exist without any segmentation.

73. Keys to the success of direct mail are the ____, which constitutes the database from which names are generated, and the ability to segment markets and, of course the offer. A. mailing lists B. informercials C. TV spots D. web pages E. shopping networks

74. Which of the following statements is true about mailing lists? A. They lead to a lot of waste coverage. B. They have become more current and selective leading to increased effectiveness. C. The most commonly used lists include a set of heterogeneous people. D. The most commonly used lists are of people who have never tried the product. E. The most commonly used lists are of individuals who have used competitor's products.

75. Companies like A. B. Zeller, Experian, and Nielsen Business Media provide _____ on a national level, and in most metropolitan areas there are firms providing the same service locally. A. TV spots B. network communications C. mailing lists D. infomercials E. marketing loans

76. The lower cost and convenience of which of the following media have raised concerns among traditional direct-mail marketers but at the same time created better opportunities? A. Television B. Radio C. Internet D. Outdoor advertising E. Transit advertising

77. Which of the following statements is true about the use of catalogs in the direct-marketing industry? A. Most business-to-business marketers use print catalogs. B. The number of catalogs mailed since 1984 has decreased significantly. C. Many companies use catalogs in conjunction with their more traditional sales and promotional strategies. D. There is no company today that relies solely on catalog sales. E. The number of catalog shoppers has steadily declined since 1984.

78. Which of the following statements is true about the use of broadcast media by the direct-marketing industry? A. Direct-response advertising is the broadcast industry does not use support advertising. B. More direct-response advertising is broadcast on radio than on television. C. The use of broadcast media over the next five years is expected to increase at a faster rate than ever before. D. The two-step approach is often used with direct-response advertising on the radio. E. When a toll-free number is included in a direct-response ad, it is called support advertising.

79. In direct-response marketing, the "direct response" sought is: A. sales. B. awareness. C. attitude change. D. changes in perception. E. return on investment (ROI).

80. Direct marketing in the broadcast industry involves both direct-response advertising and: A. supplementary promotions. B. support advertising. C. a one-step direct marketing approach to sales. D. add-on marketing. E. sweeps marketing.

81. _____ is a type of direct marketing that is designed to do exactly that—supports other forms of advertising. A. Outdoor advertising B. Publicity C. Support advertising D. Sales promotion E. Direct response advertising

82. A television ad for Pizza Hut telling you to look in your mailbox for coupon offers that will save you big bucks on your next pizza order is an example of: A. supplementary promotion. B. support advertising. C. a one-step direct marketing approach. D. add-on marketing. E. sweeps marketing.

83. Which of the following statements concerning infomercials is true? A. Infomercials are only useful for marketing fads. B. Even critics of infomercials do not consider them to be deceptive. C. The lower costs on cable and satellite channels led to the growth of the infomercial. D. By law, infomercials have to be at least 30 minutes in length. E. Infomercials typically move consumers into the conviction stage of the hierarchy of effects model.

84. Which of the following statements about infomercials is true? A. By definition, infomercials must be at least 30 minutes in length. B. Retail stores are experiencing dramatic drops in sales as a result of the growing number of infomercials. C. Studies have proven infomercials are not watched and do not sell. D. Infomercials are never used by reputable, Fortune 500-type companies. E. Some consumer groups are concerned that infomercials may be confused with regular television programming.

85. Infomercials are: A. primarily designed to sell products that would be classified as fads. B. always televised during off-viewing hours. C. never appear on network television. D. part of a two-step program, and their effectiveness cannot be measured. E. typically produced by the advertiser.

86. Due to clutter and relatively high costs, the use of _____ by direct marketers does not result in returns as high as those for other forms of direct marketing media. A. magazines and newspapers B. television and radio C. direct mail and catalogs D. newspapers, television, and radio E. newspapers, magazines, and catalogs

87. Which of the following statements about telemarketing is true? A. Telemarketing is defined as sales without face-to-face contact between the buyer and the seller. B. One of the problems that used to be associated with telemarketing is its potential for fraud and deception, but that problem has been completely eliminated by rigorous self-monitoring. C. Business-to-business marketers do not use telemarketing. D. Telemarketing is only used by for-profit companies. E. Telemarketing relates to sales by telephone.

88. _____ is the direct, personal presentation, demonstration and sales of products to consumers in their homes. A. A need-stimulus sales presentation B. Direct marketing C. A personal shopper program D. Consultative selling E. Direct selling

89. Which of the following are forms of direct selling? A. Repetitive person-to-person selling, non-repetitive person-to-person selling, and party plans B. Home shopping, out-of-home shopping, vending, and manufacturers' agents C. Party plans, out-of-home shopping, and non-repetitive person-to-person selling D. Manufacturers' sales representatives, party plans, and non-repetitive person-to-person selling E. Brokers, manufacturers' agents, party plans, and professional sales

90. In case of ____, the salesperson visits the buyer's home, job site, or other location to sell frequently purchased products or services. A. repetitive person-to-person selling B. non-repetitive person-to-person selling C. party plans D. homeshopping E. telemarketing

91. In case of ____, the salesperson visits the buyer's home, job site, or other location to sell infrequently purchased products or services. A. repetitive person-to-person selling B. non-repetitive person-to-person selling C. party plans D. homeshopping E. telemarketing

92. An Electrolux vacuum cleaner salesperson selling door-to-door is an example of which form of direct selling? A. Repetitive person-to-person selling B. Party plan C. Two-step approach D. Non-repetitive person-to-person selling E. Support selling

93. In case of ____, the salesperson offers products or services to groups of people through home or office parties and demonstrations. A. repetitive person-to-person selling B. non-repetitive person-to-person selling C. party plans D. homeshopping E. telemarketing

94. Advertisers can measure the relative effectiveness of a direct marketing campaign quickly by looking at: A. cost per thousand (CPM). B. the breakeven point. C. reach and frequency. D. cost per order (CPO). E. net sales.

95. Which effectiveness measure is most commonly employed in direct marketing? A. Cost per order (CPO) B. Cost per thousand (CPM) C. Cost per man-hour (CPMH) D. Cost per new prospect (CPNP) E. Sales per database name (SDN)

96. _____ is a measure of cost effectiveness of advertising employed by direct marketers. A. Cost per thousand B. Cost per ratings point C. Cost per order D. frequency and reach E. Breakeven point

97. Which of the following describes an advantage offered by direct marketing to advertisers? A. Personalization of messages B. Ability to create a mood C. Exclusive image D. High-budgeted direct-response ads on television E. Accuracy of list

98. Which of the following is a disadvantage associated with direct marketing? A. Poor image B. Poor selectivity C. Inability to measure effectiveness D. Long lead time E. Lack of creative flexibility

99. Disadvantages inherent in the use direct marketing include: A. difficulty in obtaining effectiveness measurements. B. poor image factors. C. lack of flexibility. D. difficulty in acquiring TV time. E. lack of personalization.

100. As postal rates increase, direct-mail advertising has frequently been replaced with: A. billboards. B. e-mail. C. use of Fedex. D. telemarketing. E. radio advertising.

Chapter 14 Direct Marketing Answer Key

True / False Questions

1. (p. 474) Direct marketing is synonymous to direct-marketing media. FALSE

Direct marketing uses a set of direct-response media, including direct mail, telemarketing, interactive TV, print, the Internet, and other media.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Defining Direct Marketing

2. (p. 476) The increase in the "money rich and time poor" people in the world have led to the success of direct marketing. TRUE

One of the major factors contributing to the success of direct marketing is that so many Americans are now "money-rich and time-poor."

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: The Growth of Direct Marketing

3. (p. 476) It is not possible to generate a behavioral response by relying solely on direct marketing. FALSE

While some organizations rely on direct marketing solely to generate a behavioral response, for many others direct marketing is an integral part of the IMC program.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: The Growth of Direct Marketing

4. (p. 476) Direct marketing activities are supported by the other elements of the promotional mix. TRUE

Direct-marketing activities are supported by other elements of the promotional mix.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

5. (p. 476) Direct marketing is a form of advertising. TRUE

Direct marketing is in itself a form of advertising. Whether through mail, print, or TV, the direct-response offer is an ad.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

6. (p. 476) Both direct marketing and advertising could support one another. TRUE

Whether through mail, print, or TV, the direct-response offer is an ad. Sometimes the ad supports the direct-selling effort.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

7. (p. 477) Telemarketing and direct selling are two methods of personal selling used to generate sales. TRUE

Telemarketing and direct selling are two methods of personal selling used to generate sales.

8. (p. 477) The main objective of direct marketing is to seek a direct response. TRUE

The direct marketer usually seeks a direct response.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Direct Marketing Objectives

9. (p. 478) The one and only objective of direct marketing is to obtain a direct behavioral response. FALSE

Not all direct marketing seeks a behavioral response. Many organizations use direct marketing to build an image, maintain customer satisfaction, and inform and/or educate customers in an attempt to lead to future actions.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Direct Marketing Objectives

10. (p. 480) For CRM to work effectively, a database is required. TRUE

For CRM to work effectively, a database is required.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

11. (p. 480) Ideally, collecting names and information about customers is sufficient in order to maintain and utilize a database effectively. FALSE

Collecting names and information is not enough; the list must be kept current, purged of old and/or inactive customers, and updated frequently.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

12. (p. 481) In the two step approach to direct marketing, the first effort generates the sales and the second effort reduces the post purchase dissonance. FALSE

The two-step approach may involve the use of more than one medium. The first effort is designed to screen, or qualify, potential buyers. The second effort generates the response.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct-Marketing Strategies and Media

13. (p. 481) Direct marketing is restricted to small companies seeking business. FALSE

Direct mail is not restricted to small companies seeking business. Respected large companies and organizations in the retail financial services, and fund-raising sectors (among others) commonly employ this medium.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct-Marketing Strategies and Media

14. (p. 482) Keys to the success of direct mail are the mailing lists. TRUE

Keys to the success of direct mail are the mailing list, which constitutes the database from which names are generated, and the ability to segment markets and, of course the offer.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct-Marketing Strategies and Media

15. (p. 482) Direct response advertising employs only the one step approach in order to solicit a sales response. FALSE

In direct-response advertising, the product or service is offered and a sales response is solicited, through either the one- or two-step approach.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct-Marketing Strategies and Media

16. (p. 487) By running the same ad on different stations, a direct marketer can determine the relative effectiveness of the medium. TRUE

By running the same ad on different stations, a direct marketer can determine the relative effectiveness of the medium itself.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Evaluating the Effectiveness of Direct Marketing

17. (p. 487) One disadvantage of direct marketing is that it results in a lot of waste coverage. FALSE

Direct marketing lets the advertiser reach a large number of people and reduces or eliminates waste coverage.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Evaluating the Effectiveness of Direct Marketing

18. (p. 488) The program vehicles used for direct-response TV advertising are usually very expensive. Hence, the marketer cannot afford to purchase repeat times. FALSE

The program vehicles used for direct-response TV advertising are usually the most inexpensive available, so the marketer can afford to purchase repeat times.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Evaluating the Effectiveness of Direct Marketing

Multiple Choice Questions

19. (p. 474) Direct marketing: A. is not a useful tool for a company that is using an integrated marketing communications plan. B. seeks the same objectives as advertising, sales promotion, and personal selling strategies in an IMC plan. C. is one of the slowest growing forms of promotion in terms of dollar expenditures. D. can generate immediate behavioral response. E. cannot be combined with other forms of promotional media.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Direct Marketing

20. (p. 474) Unlike traditional marketing, the typical goal of direct marketing is to: A. create brand image. B. generate an immediate behavioral response. C. utilize telephone communication exclusively. D. create awareness. E. convey detailed information.

Companies believe that while promotional mix tools such as advertising, sales promotion, support media, and personal selling are effective in creating brand image, conveying information, and/or creating awareness, going direct can generate an immediate behavioral response. Direct marketing is a valuable tool in the integrated communications program, though it usually seeks somewhat different objectives.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Direct Marketing

21. (p. 474) _____ is a system of marketing by which organizations communicate directly with target customers to generate a response or transaction. A. Sales promotion B. Word-of-mouth marketing C. Synchro marketing D. Direct marketing E. Publicity

Direct marketing is a system of marketing by which organizations communicate directly with target customers to generate a response or transaction.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Defining Direct Marketing

22. (p. 474) Direct marketing response can take the form of: A. an inquiry. B. awareness. C. knowledge about the product. D. sales promotion. E. push promotional strategy.

Direct marketing is a system of marketing by which organizations communicate directly with target customers to generate a response or transaction. This response may take the form of an inquiry, a purchase, or even a vote.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Defining Direct Marketing

23. (p. 474) Which of the following promotional media create an immediate response in the form of an inquiry, a purchase or even a vote? A. Trade advertising B. Publicity C. Public relations D. Direct marketing E. Synchro marketing

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Defining Direct Marketing

24. (p. 474) Which of the following is an example of direct-response media? A. Billboards B. Place-based media C. The Internet D. Product placement E. Guerrilla media

Direct marketing uses a set of direct-response media, including direct mail, telemarketing, interactive TV, print, the Internet, and other media.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Defining Direct Marketing

25. (p. 474) _____ are tools by which direct marketers implement the communications process. A. Databases B. Sweeps C. Direct-response media D. Promotional push strategies E. Encoders

Direct marketing uses a set of direct-response media, including direct mail, telemarketing, interactive TV, print, the Internet, and other media. These media are the tools by which direct marketers implement the communications process.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Defining Direct Marketing

26. (p. 474) Which of the following statements is true about direct marketing? A. Direct marketing is suitable only for consumer-to-consumer advertising. B. Direct response media includes interactive TV and print media. C. Direct marketing is not popular among industrial marketers. D. Direct marketing as a promotional media is suitable only for small retailers. E. Rapid increase in dual income families in America has led to a reduction in the use of direct marketing as a promotional media.

Direct marketing uses a set of direct-response media, including direct mail, telemarketing, interactive TV, print, the Internet, and other media.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: Defining Direct Marketing

27. (p. 474) The major impetus behind the growth of direct marketing was the: A. increase in the number of working women. B. invention of the printing press. C. development and expansion of the U.S. Postal Service. D. development of multinational companies and international markets. E. law that mandated public education.

The major impetus behind the growth of direct marketing may have been the development and expansion of the U.S. Postal Service, which made catalogs available to both urban and rural dwellers.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: The Growth of Direct Marketing

28. (p. 476) One of the reasons for the recent, rapid growth of direct marketing in American society is due to the: A. the fact the U.S. has moved from an industrialized nation to a service nation. B. increase in the number of hours individuals spend watching television. C. proliferation of cellular phones. D. increased use of consumer credit cards. E. development of four-color printing presses.

There are now more than 1 billion credit cards—bank, oil company, retail, and so on—in circulation in the United States. Of course, not all of this was through direct marketing, but a high percentage of direct purchases do use this method of payment, and companies such as American Express, Diners Club, MasterCard, and Visa are among the heaviest direct advertisers.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: The Growth of Direct Marketing

29. (p. 476) Which of the following statements is true about the growth of direct marketing? A. Direct marketing is being used as a promotional media only after the invention of Internet. B. All the purchases being made with the use of credit cards are as a result of direct marketing. C. One of the major factors contributing to the success of direct marketing is that so many Americans are now ‘time rich and money poor'. D. Increase in poverty has led to a rapid increase in direct marketing. E. The rapid technological advancement of the electronic media and the Internet has led to growth in direct marketing.

The rapid technological advancement of the electronic media and the Internet has made it easier for consumers to shop and for marketers to be successful in reaching the desired target markets and hence led to the growth of direct marketing.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-01 To recognize the area of direct marketing as a communications tool. Topic: The Growth of Direct Marketing

30. (p. 476) A magazine ad for pet health insurance contains both a toll-free number to call and a Web site to visit for more information. This ad is an example of the combining of direct marketing with: A. a trade promotion. B. public relations. C. advertising. D. personal selling. E. consumer promotion.

Obviously, direct marketing is in itself a form of advertising. Whether through mail, print, or TV, the direct-response offer is an ad. It usually contains a toll-free or 900 number or a form that requests mailing information. Sometimes the ad supports the direct-selling effort.

AACSB: Reflective Thinking Bloom's: Analyze Difficulty: Hard Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

31. (p. 476) _____ was known as the stepchild of the promotional mix. A. Advertising B. Direct marketing C. Sales promotion D. Public relations E. Publicity

Long the stepchild of the promotional mix, direct marketing has now become an important component in the integrated marketing programs of many organizations.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

32. (p. 476) The print ad of ‘Fedex' read ‘Call 1-800-FEDEX (toll free) to send gifts this Christmas to your loved ones anywhere in the world'. This print ad uses direct marketing combined with which of the following promotional media? A. Advertising B. Sales promotion C. Publicity D. Public relations E. Personal selling

33. (p. 476) Joy receives print ads from ‘HP' marketing their ink cartridges to him as it is seen that he is a regular buyer of HP ink cartridges. ‘HP' is making use of which of the following combination of promotional mix? A. Advertising and sales promotion B. Direct marketing and advertising C. Sales promotion and public relations D. Direct marketing and sales promotion E. Public relations and support media

34. (p. 477) OASIS, a charitable foundation, makes use of telemarketing for soliciting funds for charities that go towards child education. This is an example of the use of direct marketing along with: A. advertising. B. sales promotion. C. informercials. D. public relations. E. support media.

Public relations activities often employ direct-response techniques. Private companies may use telemarketing activities to solicit funds for charities or co-sponsor charities that use these and other direct response techniques to solicit funds.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

35. (p. 477) Telemarketing and _____ are two methods of personal selling used to generate sales. A. advertising B. sales promotion C. direct selling D. informercials E. homeshopping

Telemarketing and direct selling are two methods of personal selling used to generate sales.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

36. (p. 477) Airlines send out mailers or e-mails announcing promotional airfares. Which of the combinations of promotional media do they make use of? A. Advertising and sales promotion B. Advertising and direct marketing C. Sales promotion and direct marketing D. Sales promotion and public relations E. Direct marketing and personal selling

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

37. (p. 477) A press conference called by the Winchester County Museum informed the public of the need for major repairs to prevent water damage to the museum's collection of primitive paintings. During the conference, the museum representative announced that each family in Winchester County and neighboring counties could expect to receive a donation envelope in the mail within the next few days. This is an example of the combining of direct marketing with: A. a trade promotion. B. public relations. C. advertising. D. personal selling. E. consumer promotion.

38. (p. 477) When the University of Miami has volunteers call its alumni and ask them to make contributions to pay for the remodeling of the administration building, it is an example of the combining of direct marketing with: A. a trade promotion. B. public relations. C. advertising. D. personal selling. E. consumer promotion.

Telemarketing and direct selling are two methods of personal selling used to generate sales. Nonprofit organizations like charities often use telemarketing to solicit funds. As you will see, for profit companies are also using telemarketing with much greater frequency to screen and qualify prospects (which reduces selling costs) and to generate leads.

39. (p. 477) Red Bud Florist received a mail with an offer from Aquafoam, a water-soluble foam brick frequently used for arranging fresh flowers. According to the offer, if the owner of Red Bud places an order with Aquafoam, she would be automatically registered to win $10,000 in a customer appreciation contest. This is an example of the combining of direct marketing with: A. a trade promotion. B. public relations. C. advertising. D. personal selling. E. a consumer promotion.

Airlines send out mailers or e-mails announcing promotional airfares. Nordstom and other retail outlets call their existing customers to notify them of special sales promotions. Each of these is an example of a company using direct-marketing tools to inform customers of sales promotions. Here, since the sales promotional mail has been sent to the florist, it is an example of combining direct marketing with trade promotion.

40. (p. 477) To encourage customers to open mail offering them a subscription to Home Companion, the front of the envelope advised there was a gift inside. Inside was an attractively laminated bookmark. This is an example of combining direct marketing with: A. personal selling. B. support media. C. place-based media. D. product placement. E. advertising.

Adding a promotional product to a direct mailer has proved to increase response rates. One company included a promotional product in half of its 10,000 mailers and not in the other half. The former generated 65 percent more orders.

41. (p. 477) Adding a(n) _____ to a direct mailer has proved to increase response rates. A. contest B. promotional product C. informercial D. needledrop E. sweeps period

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: The Role of Direct Marketing in the IMC Program

42. (p. 477) The most common direct marketing objective that is typically expected by companies is: A. to seek a direct response. B. to increase awareness about a product/service. C. to increase knowledge of use of the product. D. to reduce post purchase dissonance. E. to sell the product at a higher price.

The direct marketer usually seeks a direct response.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Direct Marketing Objectives

43. (p. 477) A direct marketer usually seeks ____. A. to increase the brand image of the organization B. a direct response C. to build awareness of the brand D. increase long term sales E. inform customer about the product

The direct marketer usually seeks a direct response.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Direct Marketing Objectives

44. (p. 478) The success of a direct-marketing program is in large part tied to the ability to: A. combine advertising with direct marketing. B. do group marketing. C. do homeshopping. D. combine sales promotion with public relations. E. do one - to - one marketing.

Direct-marketing programs employ these principles even more than others, since the success of a direct-marketing program is in large part tied to the ability to do one-to-one marketing.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

45. (p. 478) Direct marketers make use of _____ to segment and target their markets. A. informercials B. sweeps periods C. databases D. TV spots E. junk mails

To segment and target their markets, direct marketers use a database, a listing of customers and/or potential customers.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

46. (p. 478) A ____, maintained by direct marketers, contains a listing of current and/or potential customers of the organization. A. informercial B. junk mail C. spot D. database E. response bag

To segment and target their markets, direct marketers use a database, a listing of customers and/or potential customers.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

47. (p. 478) Direct marketers make use of database in order to: A. create informercials. B. segment and target their markets. C. position their product or service. D. develop their promotional mix. E. select the direct marketing strategies to be employed.

To segment and target their markets, direct marketers use a database, a listing of customers and/or potential customers.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

48. (p. 478) _____ is the use of specific information about individual customers and/or prospects to implement more effective and efficient marketing communications. A. Information mining B. Public relations C. Data warehousing D. A marketing information system (MIS) E. Database marketing

Database marketing—the use of specific information about individual customers and/or prospects to implement more effective and efficient marketing communications.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

49. (p. 479) The National Geographic Society offers a variety of products to its subscribers through direct marketing. This is an example of: A. cross-selling. B. renewal marketing. C. an unethical business practice. D. membership-based marketing. E. remarketing.

Customers who demonstrate a specific interest also constitute strong potential for other products of the same nature. Cross selling occurs when customers who demonstrate specific interest in a particular product are sold products of the same nature.

AACSB: Reflective Thinking Bloom's: Analyze Difficulty: Hard Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

50. (p. 479) With an offer to subscribe to a cooking magazine, Rosina was offered the opportunity to buy a set of cookware, an electric can opener, and a coffee maker that were featured in the publication and selected by the magazine editors as the best value for the money. This is an example of: A. cross-selling. B. renewal marketing. C. an unethical business practice. D. membership-based marketing. E. remarketing.

AACSB: Reflective Thinking Bloom's: Analyze Difficulty: Hard Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

51. (p. 480) For customer relationship management (CRM) to work effectively, a(n) _____ is required. A. database B. sweepstake C. TV spot D. product list E. informercial

For CRM to work effectively, a database is required.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

52. (p. 480) One of the main concerns relating to database marketing is: A. its similarity with customer relationship management. B. the invasion of privacy. C. the high actual cost per thousand. D. lack of selectivity. E. waste coverage.

Database marketing has become so ubiquitous that many people are concerned about invasion of privacy.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

53. (p. 480) DMA, in relation to direct marketing activities, stands for: A. Direct Marketing Advertising. B. Direct Mail Ads. C. Database Marketing Advertisements D. Direct Marketing Association E. Direct Marketing Agency

Direct Marketing Association (DMA) has asked its members to adhere to ethical rules of conduct in their marketing efforts.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

54. (p. 480) SRDS, a United States organization provides information regarding both consumer and business lists. SRDS stands for: A. Standard Rate Dialling Service. B. Standard Rate and Data Service. C. Standard Rate Direct Source. D. State Residency Direct Service. E. Standard Real Data Source.

SRDS (Standard Rate and Data Service) provides information regarding both consumer and business lists.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

55. (p. 480) ____ conducts an annual study of customers who buy at home via mail, telephone, or Internet. It compiles information on total orders placed, types of products purchased, demographics, and purchase satisfaction, among others. A. The U.S census Bureau B. Standard Rate and Data Service (SRDS) C. The U.S Postal Service D. Direct Mail lists and data E. Simmons Market Research Bureau (SMRB)

SMRB conducts an annual study of customers who buy at home via mail, telephone, or Internet. It compiles information on total orders placed, types of products purchased, demographics, and purchase satisfaction, among others.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

56. (p. 481) To determine the effectiveness of a database, the U.S. Postal Service recommends an RFM scoring method. The letters RFM stand for: A. recency, frequency and monetary transactions between the company and the customer. B. rate of sales, fixed use fee paid, and markets reached. C. relationship between the company and the customer, frequency of the sale, and monetary transactions between the company and the customer. D. reach, frequency, and markets reached. E. ratio of inquiries to sales, frequency of sales, and market share.

RFM stands for the recency, frequency, and monetary transactions between the company and the customer.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

57. (p. 481) _____ is a method of collecting and storing a large amount of regularly updated information about the customers in the database. A. Customer development index B. Focus groups C. Delphi method D. RFM scoring method E. Cost per order method

The more information about customers that can be contained in the database, the more effective it will be. A commonly employed method for this purpose is the RFM scoring method. RFM stands for the recency, frequency, and monetary transactions between the company and the customer.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

58. (p. 481) Walmart employs a method of collecting and storing data about their customers in which data is entered each time a purchase is made by the customer. This enables the company to track how recently purchases have been made, how often they are made, and what amounts of money are being spent. This helps it in maintaining better relation with its customers. Which of the following methods of maintaining a database is employed by Walmart? A. Delphi technique B. Cost per order method C. RFM scoring method D. Customer development index E. One step approach

RFM stands for the recency, frequency, and monetary transactions between the company and the customer. More specifically, data need to be entered each time there is a transaction so the company can track how recently purchases have been made, how often they are made, and what amounts of money are being spent.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 14-02 To know the strategies and tactics involved in direct marketing. Topic: Developing a Database

59. (p. 481) The announcer on the television commercial said, "Get your credit card and call now to order the Monster Ballads of Rock & Roll CD." This is an example the _____ direct marketing approach. A. two-step B. group C. one - to - one D. one-step E. three-step

In the one-step approach, the medium is used directly to obtain an order.

AACSB: Reflective Thinking Bloom's: Analyze Difficulty: Hard Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

60. (p. 481) In the _____ approach of direct marketing, the medium is used directly to obtain an order. A. one-to-one B. one-to-many C. indirect D. one-step E. two-step

In the one-step approach, the medium is used directly to obtain an order.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

61. (p. 481) All the television commercials and other print ads that urge the customer to pick up the phone and call the toll free number to place an order immediately make use of the _____ approach of direct marketing. A. one-step B. two-step C. one-to-one D. indirect E. telemarketing

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

62. (p. 481) The goal of the _____ approach of direct marketing is to generate an immediate sale when the ad is shown. A. two-step B. one-step C. RFM scoring D. indirect E. all-in-one

In the one-step approach, the medium is used directly to obtain an order. Their goal is to generate an immediate sale when the ad is shown.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

63. (p. 481) The _____ approach of direct marketing involves the use of more than one medium. A. two-step B. one-step C. RFM scoring D. indirect E. all-in-one

The two-step approach may involve the use of more than one medium.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

64. (p. 481) Under the two-step approach of direct marketing, the first effort is designed to screen or qualify the potential buyers and the second effort: A. generates the response. B. is designed to increase awareness about the product. C. reduces the post purchase dissonance. D. increases knowledge about the use of the product. E. creates interest in the product.

The two-step approach may involve the use of more than one medium. The first effort is designed to screen, or qualify, potential buyers. The second effort generates the response (e.g., the order).

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

65. (p. 481) Which of the following companies employ a one-step approach to direct marketing? A. The QVC shopping network. B. A magazine subscription service that sends an announcement of an upcoming sweepstakes. C. An ad advising television viewers to watch their mailboxes for a way to earn free calling cards. D. A company asking if a homeowner is interested in an estimate for a vinyl siding. E. An advertisement for band - aid announcing free gifts on purchase of band - aids worth $10 and above.

In the one-step approach, the medium is used directly to obtain an order. You've probably seen TV commercials for products like wrench sets, workout equipment, or magazine subscriptions in which the viewer is urged to phone a toll-free number to place an order immediately. The major shopping channel in the United States (QVC) offers about 1,150 products a week for sale, broadcasting 24 hours/day and online.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

66. (p. 481) To purchase cookware, music CDs, and exercise videos advertised on television consumers are asked to call a toll-free telephone number. Viewers are instructed to have their credit cards handy when they call to place the order. This form of direct marketing is referred to as: A. outbound telemarketing. B. videotext. C. the one-step approach. D. the two-step approach. E. support marketing.

In the one-step approach, the medium is used directly to obtain an order. You've probably seen TV commercials for products like wrench sets, workout equipment, or magazine subscriptions in which the viewer is urged to phone a toll-free number to place an order immediately. Their goal is to generate an immediate sale when the ad is shown.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

67. (p. 481) When a direct advertising medium is designed to directly obtain an order, the _____ approach is being used? A. two-step B. indirect C. direct D. one-step E. bulls-eye

In the one-step approach, the medium is used directly to obtain an order. Their goal is to generate an immediate sale when the ad is shown.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

68. (p. 481) In direct marketing situations, when it is necessary to screen or qualify potential buyers, it is advisable to use: A. the two-step approach. B. the one-step approach. C. direct mail rather than telemarketing. D. direct-response television. E. SMRB's data on direct marketing purchasers.

The two-step approach may involve the use of more than one medium. The first effort is designed to screen, or qualify, potential buyers. The second effort generates the response (e.g., the order).

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

69. (p. 481) The two-step approach to direct marketing: A. asks for an immediate sale. B. uses the first contact to screen potential buyers. C. is commonly found in direct sales. D. is followed by a professional sales call. E. is similar to missionary selling.

The two-step approach may involve the use of more than one medium. The first effort is designed to screen, or qualify, potential buyers. The second effort generates the response (e.g., the order).

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

70. (p. 481) A television commercial in which Publishers Clearing House urges consumers to look in their mailboxes for soon-to-arrive sweepstakes entries is an example of: A. sweeps marketing. B. add-on marketing. C. specialty advertising. D. the one-step approach to direct marketing. E. the two-step approach to direct marketing.

The two-step approach may involve the use of more than one medium. The first effort is designed to screen, or qualify, potential buyers. The second effort generates the response (e.g., the order).

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

71. (p. 481) _____ is often called the ‘junk mail'. A. Sweepstake B. Informercial C. TV spot D. Direct mail E. Database marketing

Direct mail is often called "junk mail"—the unsolicited mail you receive.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

72. (p. 482) Market segmentation in the direct marketing industry: A. is not a viable strategy. B. is used effectively by only a few large companies. C. is considered less efficient than mass mailings. D. is directly tied to the mailing list. E. is unnecessary because demographic and geographic selectivity exist without any segmentation.

Keys to the success of direct mail are the mailing list, which constitutes the database from which names are generated, and the ability to segment markets and, of course the offer.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

73. (p. 482) Keys to the success of direct mail are the ____, which constitutes the database from which names are generated, and the ability to segment markets and, of course the offer. A. mailing lists B. informercials C. TV spots D. web pages E. shopping networks

Keys to the success of direct mail are the mailing list, which constitutes the database from which names are generated, and the ability to segment markets and, of course the offer.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

74. (p. 482) Which of the following statements is true about mailing lists? A. They lead to a lot of waste coverage. B. They have become more current and selective leading to increased effectiveness. C. The most commonly used lists include a set of heterogeneous people. D. The most commonly used lists are of people who have never tried the product. E. The most commonly used lists are of individuals who have used competitor's products.

Lists have become more current and more selective, eliminating waste coverage. Segmentation on the basis of geography (usually through Zip codes), demographics, and lifestyles has led to increased effectiveness.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

75. (p. 482) Companies like A. B. Zeller, Experian, and Nielsen Business Media provide _____ on a national level, and in most metropolitan areas there are firms providing the same service locally. A. TV spots B. network communications C. mailing lists D. infomercials E. marketing loans

Companies like A. B. Zeller, Experian, and Nielsen Business Media provide mailing lists on a national level, and in most metropolitan areas there are firms providing the same service locally.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

76. (p. 482) The lower cost and convenience of which of the following media have raised concerns among traditional direct-mail marketers but at the same time created better opportunities? A. Television B. Radio C. Internet D. Outdoor advertising E. Transit advertising

The lower cost of e-mail and the convenience of the Internet have raised concerns among traditional direct-mail marketers. Interestingly, the Internet is both a threat and an opportunity, as Internet companies have increased their expenditures in direct mail to drive potential customers to their sites.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

77. (p. 483) Which of the following statements is true about the use of catalogs in the direct-marketing industry? A. Most business-to-business marketers use print catalogs. B. The number of catalogs mailed since 1984 has decreased significantly. C. Many companies use catalogs in conjunction with their more traditional sales and promotional strategies. D. There is no company today that relies solely on catalog sales. E. The number of catalog shoppers has steadily declined since 1984.

Many companies use catalogs in conjunction with their more traditional sales and promotional strategies.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

78. (p. 483) Which of the following statements is true about the use of broadcast media by the direct-marketing industry? A. Direct-response advertising is the broadcast industry does not use support advertising. B. More direct-response advertising is broadcast on radio than on television. C. The use of broadcast media over the next five years is expected to increase at a faster rate than ever before. D. The two-step approach is often used with direct-response advertising on the radio. E. When a toll-free number is included in a direct-response ad, it is called support advertising.

It should be noted that the two-step approach is still very common on the radio, particularly with local companies.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

79. (p. 483) In direct-response marketing, the "direct response" sought is: A. sales. B. awareness. C. attitude change. D. changes in perception. E. return on investment (ROI).

In direct-response advertising, the product or service is offered and a sales response is solicited, through either the one- or two-step approach previously discussed.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

80. (p. 483) Direct marketing in the broadcast industry involves both direct-response advertising and: A. supplementary promotions. B. support advertising. C. a one-step direct marketing approach to sales. D. add-on marketing. E. sweeps marketing.

Direct marketing in the broadcast industry involves both direct-response advertising and support advertising.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

81. (p. 483) _____ is a type of direct marketing that is designed to do exactly that—supports other forms of advertising. A. Outdoor advertising B. Publicity C. Support advertising D. Sales promotion E. Direct response advertising

Direct marketing in the broadcast industry involves both direct-response advertising and support advertising. Support advertising is designed to do exactly that—support other forms of advertising.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

82. (p. 483) A television ad for Pizza Hut telling you to look in your mailbox for coupon offers that will save you big bucks on your next pizza order is an example of: A. supplementary promotion. B. support advertising. C. a one-step direct marketing approach. D. add-on marketing. E. sweeps marketing.

Support advertising is designed to do exactly that—support other forms of advertising. Ads for Publishers Clearing House or Reader's Digest or other companies telling you to look in your mailbox for a sweepstakes entry are examples of support advertising.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

83. (p. 484) Which of the following statements concerning infomercials is true? A. Infomercials are only useful for marketing fads. B. Even critics of infomercials do not consider them to be deceptive. C. The lower costs on cable and satellite channels led to the growth of the infomercial. D. By law, infomercials have to be at least 30 minutes in length. E. Infomercials typically move consumers into the conviction stage of the hierarchy of effects model.

The lower cost of commercials on cable and satellite channels has led advertisers to a new form of advertising.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

84. (p. 484) Which of the following statements about infomercials is true? A. By definition, infomercials must be at least 30 minutes in length. B. Retail stores are experiencing dramatic drops in sales as a result of the growing number of infomercials. C. Studies have proven infomercials are not watched and do not sell. D. Infomercials are never used by reputable, Fortune 500-type companies. E. Some consumer groups are concerned that infomercials may be confused with regular television programming.

Four consumer groups have asked the FCC to require all infomercials to display a symbol that indicates a "paid ad" or "sponsored by" so that viewers won't confuse them with regular programming.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

85. (p. 484) Infomercials are: A. primarily designed to sell products that would be classified as fads. B. always televised during off-viewing hours. C. never appear on network television. D. part of a two-step program, and their effectiveness cannot be measured. E. typically produced by the advertiser.

Many infomercials are produced by the advertisers and are designed to be viewed as regular TV shows.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

86. (p. 486) Due to clutter and relatively high costs, the use of _____ by direct marketers does not result in returns as high as those for other forms of direct marketing media. A. magazines and newspapers B. television and radio C. direct mail and catalogs D. newspapers, television, and radio E. newspapers, magazines, and catalogs

Magazines and newspapers are difficult media to use for direct marketing. Because these ads have to compete with the clutter of other ads and because the space is relatively expensive, response rates and profits may be lower than in other media.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

87. (p. 486) Which of the following statements about telemarketing is true? A. Telemarketing is defined as sales without face-to-face contact between the buyer and the seller. B. One of the problems that used to be associated with telemarketing is its potential for fraud and deception, but that problem has been completely eliminated by rigorous self-monitoring. C. Business-to-business marketers do not use telemarketing. D. Telemarketing is only used by for-profit companies. E. Telemarketing relates to sales by telephone.

If you have a telephone, you probably do not have to be told about telemarketing, or sales by telephone.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Marketing Strategies and the Media

88. (p. 486) _____ is the direct, personal presentation, demonstration and sales of products to consumers in their homes. A. A need-stimulus sales presentation B. Direct marketing C. A personal shopper program D. Consultative selling E. Direct selling

Direct selling is the direct, personal presentation, demonstration, and sales of products and services to consumers in their homes.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Selling

89. (p. 486) Which of the following are forms of direct selling? A. Repetitive person-to-person selling, non-repetitive person-to-person selling, and party plans B. Home shopping, out-of-home shopping, vending, and manufacturers' agents C. Party plans, out-of-home shopping, and non-repetitive person-to-person selling D. Manufacturers' sales representatives, party plans, and non-repetitive person-to-person selling E. Brokers, manufacturers' agents, party plans, and professional sales

The three forms of direct selling are repetitive person to person selling, non-repetitive person-to-person selling, and party plans.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Selling

90. (p. 486) In case of ____, the salesperson visits the buyer's home, job site, or other location to sell frequently purchased products or services. A. repetitive person-to-person selling B. non-repetitive person-to-person selling C. party plans D. homeshopping E. telemarketing

In case of repetitive person-to-person selling, the salesperson visits the buyer's home, job site, or other location to sell frequently purchased products or services.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Selling

91. (p. 486) In case of ____, the salesperson visits the buyer's home, job site, or other location to sell infrequently purchased products or services. A. repetitive person-to-person selling B. non-repetitive person-to-person selling C. party plans D. homeshopping E. telemarketing

In case of non-repetitive person-to-person selling, the salesperson visits the buyer's home, job site, or other location to sell infrequently purchased products or services.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Selling

92. (p. 486) An Electrolux vacuum cleaner salesperson selling door-to-door is an example of which form of direct selling? A. Repetitive person-to-person selling B. Party plan C. Two-step approach D. Non-repetitive person-to-person selling E. Support selling

In case of non-repetitive person-to-person selling, the salesperson visits the buyer's home, job site, or other location to sell infrequently purchased products or services.

AACSB: Analytic Bloom's: Remember Difficulty: Hard Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Selling

93. (p. 486) In case of ____, the salesperson offers products or services to groups of people through home or office parties and demonstrations. A. repetitive person-to-person selling B. non-repetitive person-to-person selling C. party plans D. homeshopping E. telemarketing

In case of party plans, the salesperson offers products or services to groups of people through home or office parties and demonstrations.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-03 To demonstrate the use of direct-marketing media. Topic: Direct Selling

94. (p. 487) Advertisers can measure the relative effectiveness of a direct marketing campaign quickly by looking at: A. cost per thousand (CPM). B. the breakeven point. C. reach and frequency. D. cost per order (CPO). E. net sales.

Using the cost per order (CPO), advertisers can evaluate the relative effectiveness of an ad in only a few minutes based on the number of calls generated.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Evaluating the Effectiveness of Direct Marketing

95. (p. 487) Which effectiveness measure is most commonly employed in direct marketing? A. Cost per order (CPO) B. Cost per thousand (CPM) C. Cost per man-hour (CPMH) D. Cost per new prospect (CPNP) E. Sales per database name (SDN)

Using the cost per order (CPO), advertisers can evaluate the relative effectiveness of an ad in only a few minutes based on the number of calls generated.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Evaluating the Effectiveness of Direct Marketing

96. (p. 487) _____ is a measure of cost effectiveness of advertising employed by direct marketers. A. Cost per thousand B. Cost per ratings point C. Cost per order D. frequency and reach E. Breakeven point

Using the cost per order (CPO), advertisers can evaluate the relative effectiveness of an ad in only a few minutes based on the number of calls generated.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Evaluating the Effectiveness of Direct Marketing

97. (p. 488) Which of the following describes an advantage offered by direct marketing to advertisers? A. Personalization of messages B. Ability to create a mood C. Exclusive image D. High-budgeted direct-response ads on television E. Accuracy of list

No other advertising medium can personalize the message as well as direct media.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Advantages and Disadvantages of Direct Marketing

98. (p. 489) Which of the following is a disadvantage associated with direct marketing? A. Poor image B. Poor selectivity C. Inability to measure effectiveness D. Long lead time E. Lack of creative flexibility

The mail segment of this industry is often referred to as junk mail. Many people believe unsolicited mail promotes junk products, and others dislike being solicited. Direct-response ads on TV are often low-budget ads for lower priced products, which contributes to the image that something less than the best products are marketed in this way.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Advantages and Disadvantages of Direct Marketing

99. (p. 489) Disadvantages inherent in the use direct marketing include: A. difficulty in obtaining effectiveness measurements. B. poor image factors. C. lack of flexibility. D. difficulty in acquiring TV time. E. lack of personalization.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Advantages and Disadvantages of Direct Marketing

100. (p. 490) As postal rates increase, direct-mail advertising has frequently been replaced with: A. billboards. B. e-mail. C. use of Fedex. D. telemarketing. E. radio advertising.

As postal rates increase, direct-mail profits are immediately and directly impacted.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 14-04 To determine the scope and effectiveness of direct marketing. Topic: Advantages and Disadvantages of Direct Marketing

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