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Chapter 19 - International Advertising and Promotion

Chapter 19

International Advertising and Promotion

True / False Questions

1. International markets are important to small and mid-size companies as well as large multinational corporations. True False

2. Demographic data can provide insight into the living standards and lifestyles in a particular country to help companies plan ad campaigns. True False

3. One of the main advantages of global marketing and advertising is economies of scale in production and distribution. True False

4. Product standardization results in higher production costs. True False

5. Product standardization is becoming increasingly important as a result of longer product life cycles. True False

6. It is extremely easy to develop an effective universal approach to marketing and advertising a single product across the world. True False

7. Products that are steeped in the cultural heritage of a country are best suited to worldwide appeals. True False

8. Brands or messages that have a primarily verbal appeal are best suited for worldwide ad campaigns. True False

9. A centralized approach to organizing for advertising is not suitable when market and media conditions are similar from one country to another. True False

10. A decentralized approach to organizing for advertising should be adopted when the company can use standardized advertising. True False

11. Many companies prefer a centralized organizational structure to keep control of the marketing effort and corporate and/or brand image. True False

12. Centralization of international advertising may also be best when a company operates through foreign distributors or licensees who do not become involved in the marketing and promotional process. True False

Multiple Choice Questions

13. Which of the following factors is limiting growth opportunities in the U.S. market for many companies? A. Huge population growth B. Saturated markets for many products and services C. Low competition from domestic companies D. Low competition from foreign companies E. Large markets for foreign products

14. Many tobacco companies and breweries in the U.S. are focusing their efforts on international markets to sustain growth because of: A. high population growth, which leads to an unfavorable market environment. B. the unsaturated domestic market, which leaves little possibility for expansion. C. declining domestic consumption as a result of restrictions on their marketing and advertising efforts. D. the saturated markets in foreign countries. E. the high competition prevalent in foreign markets.

15. Had globalization not occurred, most European companies would not have been able to compete against larger U.S. and Japanese companies because of: A. the lack of funds among Europeans. B. the inability to achieve economies of scale owing to the small size of most of the European nations. C. the lack of education about international markets. D. the cultural differences prevailing amongst nations. E. the political and legal differences amongst the nations.

16. Swiss-based Nestlé and Netherlands-based Unilever are two of the world's largest consumer-product companies as a result of: A. the favourable climatic conditions prevailing in the countries. B. the large population existing in these countries. C. the intense competition they face from domestic companies. D. their ability to market their brands to consumers around the world. E. their concentration on domestic markets and minimal expansion to international markets.

17. The difference between the monetary value of a nation's exports and imports is its: A. added value. B. international trade. C. balance of trade. D. balance of payments. E. value of exports.

18. A balance of trade deficit exists when the: A. value of imports exceeds that of exports. B. value of exports exceeds that of imports. C. supply of imports exceeds the demand for them. D. the value added by the exporting nation exceeds that added by the importing nation. E. the value of exports and imports are about equal.

19. The U.S. has been experiencing a continuing balance of trade ____. This _____ the importance of international marketing efforts by U.S. companies. A. surplus; increases B. surplus; decreases C. deficit; increases D. deficit; decreases E. increase; increases

20. The part of a firm's marketing functions that is the most visible to consumers as well as the most culture-bound is its: A. pricing. B. promotion. C. product development. D. distribution. E. inventory management.

21. Which of the following is an example of a major external environmental factor that a company must consider when analyzing the international marketing environment? A. economic factors B. product factors C. promotional factors D. pricing factors E. advertising factors

22. Which of the following is a part of the economic environment of a foreign country? A. Language B. Values and ethics C. Currency stability D. Size of population E. Education levels

23. Which of the following is a cultural factor affecting international marketing? A. Currency stability B. Lifestyles C. Distribution of wealth D. Nationalism E. Government policies

24. _____ is an example of a cultural factor affecting international marketing. A. Laws B. Currency stability C. Income levels D. Language E. Government regulations

25. Which of the following forms a part of the demographic environment of a country? A. Age distribution B. Distribution of wealth C. Lifestyles D. Norms and customs E. Exchange rates

26. The communications, transportation, financial and distribution networks of a country are part of its: A. political/legal environment. B. cultural environment. C. economic infrastructure. D. demographic environment. E. international interface.

27. For companies wishing to enter a new market, a country's economic conditions indicate its ____, since products and services can be sold only to countries where there is enough income to buy them. A. size of population B. attitudes towards multinationals C. cultural norms and values D. present and future potential for consuming E. occupation distribution

28. When the CEO of International Partners, Ltd. was in Katmandu, the capital of Nepal, he found that 90 percent of his telephone calls didn't connect to the party he was calling. This represents a problem with Nepal's: A. demographic environment. B. economic infrastructure. C. balance of payments. D. cultural system. E. advertising system.

29. A U.S. executive in Namibia in Africa experienced trouble negotiating a franchise deal with local investors because the electricity was constantly shutting off. One of the investors was unable to attend the meeting because there is so little public transportation in the country. These problems indicate a problem with Namibia's: A. demographic environment. B. economic infrastructure. C. balance of payments. D. cultural system. E. advertising system.

30. China and India in particular are two countries that are transforming the global economy. One of the main reasons for this is: A. high population growth rate. B. lack of savings habit among the nations. C. less demand and needs. D. lower economic growth rates. E. lack of demand for luxury items.

31. Factors such as size of the population, age distribution, education, and income levels are part of a country's _____ characteristics. A. economic B. demographic C. cultural D. political/legal E. lifestyle

32. In the past few years, international toy manufacturers have been targeting the South American market as a result of the growth in the youngest segment of the population. Which of the following factors has influenced this decision? A. Psychographic factors B. Geographic factors C. Demographic factors D. Cultural factors E. Legal factors

33. A U.S. exporter of baby furniture is planning to export its products to another country. The company wants to know how many people are in the Full Nest I stage of the family life cycle in that country. This type of information is part of a nation's _____ environment. A. economic B. demographic C. cultural D. political/legal E. lifestyle

34. _____ variables marketers must consider include language, customs, tastes, attitudes, lifestyles, values, and ethical/moral standards. A. Demographic B. Economic C. Political D. Cultural E. Legal

35. The Polaroid Corporation encountered great problems when it attempted to market instant cameras in France. The French consumer saw little need for having a picture developed instantly. This indicates Polaroid did not understand the French _____ environment. A. demographic B. economic C. cultural D. political/legal E. media

36. Variables such as language, customs, tastes, values and lifestyles are part of a country's: A. cultural environment. B. infrastructure. C. demographic environment. D. regulatory environment. E. political/legal environment.

37. _____ factors of the international environment probably create more problems for advertisers than any others since they directly impact the ability to communicate effectively with consumers in foreign countries. A. Demographic B. Economic C. Cultural D. Political E. Marketing mix

38. Most Asian women are shy about their bodies. This would be important _____ information to a company like Victoria's Secret as it expands into Korean markets. A. demographic B. economic C. cultural D. political E. infrastructure

39. To market on the Belgian home shopping channel, advertisers have to prepare programs in Flemish (a version of Dutch), Dutch and German because all three languages are commonly spoken in Belgium. This language difficulty represents a _____ problem for a U.S. company trying to sell its products on the Belgian home shopping channel. A. demographic B. economic C. infrastructure D. political E. cultural

40. A delivery service must understand that as a result of _____ differences, Europeans are not as time-sensitive as Americans, and Asians are even less time-sensitive than Europeans. A. economic B. demographic C. political D. cultural E. infrastructure

41. The only South American country where Coca-Cola is not the market leader is Peru, where local tastes prefer Inca Kola. Inca Kola is golden-yellow in color and tastes like banana-flavored bubble gum. Which environmental factor is most responsible for the fact Coca-Cola does not sell well in Peru? A. Economic B. Demographic C. Political D. Cultural E. Infrastructure

42. In France, cosmetics are used heavily by men as well as women and advertising directed to the male market is common. Consumers in the U.S. are heavier users of personal hygiene products such as deodorants and mouthwashes. These are examples of _____ differences that affect consumption patterns. A. demographic B. economic C. cultural D. regulatory E. generic

43. _____ refers to the tendency of individuals to view their own group or society as the center of the universe. A. Central perception B. Halo effect C. Origin-of-country effect D. Ethnocentrism E. Xenocentrism

44. Which of the following statements about cultural values is true? A. In today's globalized market, cultural differences are negligible. B. The values and beliefs of a society can affect its members' receptivity toward foreign products and services. C. Cultural values are personal values and are only applicable on an individual level. D. A highly ethnocentric culture will be extremely receptive to foreign products. E. Cultural values have no effect on the market or consumer behavior.

45. A beverage company entered a new market in which it saw great potential. However, though its products matched those of local competitors in quality and price, sales were sluggish. The company realized that consumers believed that the local brands were better just because they were local. It had failed to account for the _____ of the consumers during the planning process. A. demographics B. ethnocentrism C. pluralism D. cultural relativism E. xenocentrism

46. In the U.S., promotions for Agile Sports products emphasize individualism and independence. In Japan, however, the company had to change its message to one that focused on team values and cooperation, due to the differing _____ in the two countries. A. demographics B. religious beliefs C. cultural values D. ethics E. lifestyles

47. U.S. brands have become popular in many other European countries as well as in Asia. Marketers attribute the rising popularity of many U.S.-made products to: A. the increased familiarity of foreign nationals with American culture, values, and lifestyles. B. their superior quality. C. the low prices of the products. D. the centralized organizational approach adopted by most U.S companies. E. the increasingly ethnocentric attitude of the consumers around the world.

48. Chinese values are centered around ____, which stresses loyalty and interpersonal relationships. A. ethnocentrism B. Confucianism C. the country-of-origin effect D. the halo effect E. xenocentrism

49. To reach out to the youth market in the Middle East, Coca-Cola and Pepsi have: A. pressured area governments into creating a single set of laws on advertising in the Middle East and established strict policies for their enforcement. B. called for each Middle Eastern country to determine its own policies on advertising regulation. C. used a variety of IMC tools including sponsorships and branded entertainment. D. emphasized their association with America and American foreign policies. E. targeted parents because of their strong influence on teenagers' consumption preferences.

50. An American sporting goods manufacturer wanting to sell on the Belgian home shopping channel would find that different laws govern the people who live in the Flemish communities, the German communities and the French communities that exist in the nation. For instance, in the French-speaking community of Walloon in Belgium, the home shopping channel is legal. It is an illegal operation, however, in Flanders, the area of the country where Flemish is spoken. This is an example of how _____ factors affect global marketing. A. economic B. demographic C. political/legal D. cultural E. infrastructure

51. Since the European Union banned the use of food dyes in seafood, the salmon market has suffered. People mistakenly believe that salmon is naturally pink. Unfortunately, salmon is an unappetizing gray color. This is an example of how _____ factors can inadvertently hurt small businesses. A. economic B. demographic C. political/legal D. geographic E. infrastructure

52. Diet Coke is known as Coca-Cola Light in Germany, France and many other countries because these countries have legal restrictions prohibiting the use of the word diet. This is an example of how _____ factors affect global marketing. A. economic B. demographic C. political/legal D. cultural E. infrastructure

53. _____ is a strategy of advertising in which certain banned products are indirectly advertised by labeling a non-banned product with a familiar logo so as to develop brand image and easy recall. A. Aerial advertising B. Transit advertising C. Surrogate advertising D. Cross-selling E. Ethnocentrism

54. The UB Group named its airline business Kingfisher, after its popular beer brand of the same name. This is one of the most successful examples of ____. The extension of the Kingfisher brand to the airline gave a great push to the original category, beer, which cannot be advertised in many parts of the world. A. ethnocentrism B. subliminal perception C. aerial advertising D. surrogate advertising E. puffery

55. _____ is a marketing approach that assumes that the needs satisfied by a product or service and the way it is used are the same everywhere in the world, and therefore utilizes a common approach in all countries. A. Global marketing B. Complementary marketing C. Localized marketing D. Nationalized marketing E. Countertrading

56. The concept of ______ deals with all elements of a firm's marketing mix while the concept of _____ deals specifically with the communication aspect of marketing. A. global marketing: global advertising B. global advertising: standardization C. global advertising: global marketing D. standardization: global marketing E. adaptation: standardization

57. _____ was the marketing scholar who popularized the concept of global marketing. A. Phillip Kotler B. John Naisbitt C. Theodore Levitt D. Peter Drucker E. Robert Holloway

58. Production standardization leads to: A. high production costs. B. lower prices of products. C. lower marketing efficiency. D. increased competition. E. higher lead times.

59. British Airways believes it is very difficult to differentiate itself from other major airlines on the basis of schedules, routes and price. However, the airline thinks it can be differentiated on the basis of service and has decided to focus much of its effort on image advertising using the theme "The World's Favorite Airline". Which of the following is correct regarding this type of advertising campaign? A. This campaign will definitely require a localized approach with different ads for each country. B. This campaign could easily be adapted to a global campaign since the focus is on service and image, which are easily understood by airline passengers in all countries. C. This campaign will require a localized strategy since perceptions of service will definitely be different among airline passengers in every country. D. British Airlines should forget the service campaign and focus on price since international flights are chosen on a price basis. E. The campaign will definitely fail as ‘service' is intangible.

60. For which of the following will worldwide appeals NOT be appropriate? A. Brands or messages that have great visual appeal B. Image campaigns that play to universal needs, values, and emotions. C. High-tech products and new products D. Products that evoke the country-of-origin effect E. Products that are steeped in cultural traditions and significance

61. Products such as Swiss watches, German automobiles and French wines are automatically assumed to be superior to similar products from other countries because: A. they are all high-tech products. B. they appeal to market segments with universal tastes and interests. C. they come from countries that have strong reputations for making these products. D. they can be advertised using totally visual appeals. E. they appeal to a market segment with universally similar tastes, interests, needs, and values.

62. Products from countries with national reputations for quality and/or a distinctive image that can be used as the basis for global advertising capitalize on the: A. ability to cross-sell. B. country-of-origin effect. C. customary and accepted perception. D. self-regulation of global images rule. E. Central Hudson test.

63. _____ refers to consumers' general perceptions of quality for products made in a given country. A. Cross-selling B. Country-of- origin effect C. Halo effect D. Global imaging E. Central Hudson test

64. _____ is an advertising format where ads follow the same basic approach but themes, copy, and visual elements may be adjusted. A. Global advertising B. Local advertising C. Pattern advertising D. Formatted advertising E. Ad standardization

65. The _____ approach recognizes similar desires, goals, needs, and uses for products and services, but tailors advertising to the local cultures and conditions in each market. A. concentrated marketing B. think globally, act locally C. localized D. domestic E. globalized marketing

66. Weight Watchers, having achieved a 50 percent market share in the United States, was ready to move into international markets. The company found it had to introduce new diets and weight-loss measures on a country-by-country basis even though it maintained its basic ad campaign. Weight Watchers used: A. localized advertising. B. consistency advertising. C. a standardized formatting strategy. D. pattern advertising. E. undifferentiated marketing.

67. Gillette had a worldwide advertising campaign for its Sensor razors using the ad campaign theme "Gillette—the best a man can get." Some of the ads featured sports stars from the host country rather than using only one sports star in all of the ads. This is an example of a(n): A. localized advertising approach. B. application of the "think global, act regionally" approach to international advertising. C. totally global or standardized approach. D. totally customized approach. E. ethnocentric approach to advertising.

68. The dominant strategy used by most international advertisers today is to: A. centralize all of the marketing mix elements except promotion. B. use localized advertising. C. "think locally and act globally". D. "think globally and act regionally". E. use standardized advertising.

69. Three basic options for organizing international marketing are: centralization at the home office or headquarters, decentralization of decision-making to local foreign markets, and: A. centralization at local foreign markets. B. centralization at regional markets. C. decentralization of headquarters. D. a combination of centralization and decentralization. E. decentralization of regional offices.

70. In case of a _____ approach to international advertising and promotion function, all decisions about agency selection, research, creative strategy and campaign development, media strategy, and budgeting are made at the firm's home office. A. centralized B. decentralized C. localized D. combination E. regional

71. Complete _____ of international advertising is likely when market and media conditions are similar from one country to another, when the company has only one or a few international agencies handling all of its advertising, when the company can use standardized advertising, or when it desires a consistent image worldwide. A. localization B. globalization C. decentralization D. centralization E. regionalization

72. Automated Logic Systems manufactures high-tech building automation systems and sells them to Latin American and Asian buyers. The company has decided to use _____ and make all major strategy and budgeting decisions at the home office. A. a centralized organizational structure B. a decentralized organizational structure C. a combination structure D. a localized structure E. combination marketing

73. Allise Industries manufactures and exports copper wiring to markets all over the world. It has adopted an advertising organizational structure in which its managers in each country or region have the authority to make decisions for their market. Allise Industries has a _____ organizational structure. A. centralized B. decentralized C. matrix D. individualized E. globalized

74. In planning advertising for the 2008 Olympics, international travel agencies discovered they needed to use different ad campaigns to appeal to travelers from different countries. Americans wanted a trip that allowed them to have an extended stay. Japanese travelers went to attend specific events and wanted to return home as soon as the events were over. Global travel agencies gave the managers of their foreign offices the authority to develop country-appropriate advertising. This is an example of how a _____ advertising organizational structure works. A. centralized B. decentralized C. pattern D. globalized E. matrix

75. In which of the following cases would centralization of the advertising function be a disadvantage? A. When the advertiser wants to maintain a consistent brand image across markets. B. When the advertiser wants to keep control of its brand message and image. C. When the product is a high-technology product with universal appeal. D. When the market conditions in the various markets differ widely. E. When the company wants to save costs.

76. For its international advertising, Levi Strauss & Co. uses an organizational approach in which a vice president of global marketing who oversees the company's marketing program in 60 countries but still provides autonomy to local and regional marketing directors. This is an example of a: A. centralized approach. B. totally global approach. C. decentralized approach. D. combination of the centralized and decentralized approaches. E. matrix network.

77. When beginning an international marketing campaign, many American companies prefer to use an international ad agency based in the U.S. with foreign offices in other countries. This is because: A. U.S. agencies are the most creative. B. U.S. agencies understand world markets better than foreign agencies do. C. agencies based in the U.S. give the advertiser better control of the advertising process and facilitate the coordination of international advertising. D. U.S.-based agencies generally understand local markets better than agencies located in these countries. E. the U.S. culture is the most used as a basis for understanding other cultures.

78. Why are global marketers consolidating their advertising into one agency? A. To implement the philosophies of Theodore Levitt. B. Due to terrorists' activities in other parts of the world. C. Because the importance of cultural barriers has declined significantly. D. Because agencies now have the ability to communicate globally. E. In order to distribute costs among the different participating countries.

79. Marketers who think it is important to have advertising done by an agency that has a very good understanding of each international market in which it sells its products are likely to use a(n): A. U.S.-based international agency. B. U.S.-based agency with regional offices that could serve each country. C. local agency for each national market. D. in-house agency. E. specialty agency.

80. When Campbell's introduced its condensed soup in Great Britain it made no changes to the product as we know it in the U.S. The British, however, thought the soup was expensive and in very small cans—they were unaware of the need to add water. When this campaign was developed, Campbell's undoubtedly did not use: A. a centralized approach to its advertising. B. local agency for each national market. C. a public relations agency. D. creative boutiques. E. a hierarchical approach to its advertising.

81. In the United States, people with golden tans are generally seen as attractive and possibly even well-to-do. However, in other countries, such as the Philippines, suntans are indicative of laborers and underprivileged people. A U.S. company planning on marketing a line of tanning lotions, bronzing creams, and salves for sunburns globally realizes it is important to select an advertising agency that truly understands each foreign market. The company should: A. use a U.S.-based international agency. B. use a U.S. based agency that has a few offices in foreign countries. C. use local agencies for each country it wants to enter. D. use a superagency with global marketing capabilities. E. use a globalized marketing strategy.

82. The primary reason many companies do not conduct advertising research in international markets is due to: A. the language differences. B. high costs. C. efficiencies of scale. D. the fear of losing a competitive advantage. E. the lack of local advertising agencies.

83. During a World Cup soccer match, both McDonald's and Coca-Cola made the mistake of reprinting the Saudi Arabia flag, which includes sacred words from the Koran, on disposable packaging used in promotions. The uproar over this misuse of a cultural symbol forced a recall of the offending items. _____ could have prevented this recall. A. Advertising research B. Dyadic communication C. Creative decision-making D. A global approach to advertising E. A centralized approach to advertising

84. The U.S. federal government agency that works closely with U.S. companies to help them sell their products and services to foreign markets is the: A. Federal Trade Commission. B. Overseas Business Commission. C. U.S. Department of Commerce. D. United Nations. E. National Chamber of Commerce.

85. Which of the following types of marketing information would be most difficult to find in foreign markets, especially in developing countries? A. Demographic characteristics B. Information on economic conditions C. Information on cultural norms and values D. Information on consumers' product usage, brand attitudes and media preferences and usage E. Information on population size and characteristics

86. The _____ is an annual report that provides demographic and economic data on more than 200 countries. A. Predicast Report B. NCH Promotional Services Report C. World Population Report D. United Nations Statistical Yearbook E. International Marketing Handbook

87. Which of the following statements about making creative decisions for international advertising is true? A. The creative approach used in a company's primary market usually will transfer well to foreign markets. B. Creative strategies may have to be different for each market depending on factors such as consumers' usage patterns, cultural backgrounds and lifestyles. C. Emotional appeals such as humor work well in virtually any country. D. Sexual appeals work very well in nearly every country. E. Dramatization ads work well only in United States and Europe.

88. If advertisers use a ____, the agency will know that humorous advertising appeals are popular in the United Kingdom but German consumers do not respond well to them. A. global marketing strategy B. sales promotion tactic C. global public relations strategy D. localized advertising strategy E. centralized marketing strategy

89. When companies follow a ____, the creative team must determine what type of selling idea, ad appeal, and execution style will work in each market. A. global marketing strategy B. sales promotion tactic C. global public relations strategy D. localized advertising strategy E. centralized marketing strategy

90. Time Inc., has launched new editions of Sports Illustrated and InStyle in China; People and Sports Illustrated in India; Fortune in Korea; and InStyle in Thailand. Which of the following is true for advertisers in these magazines? A. As these are international publications, cultural differences between markets will be negligible. B. Readers of these publications are usually upscale, high-income individuals who are desirable target markets for many products. C. Their reach in foreign countries will be extremely high. D. The magazines offer an excellent advertising medium for marketers of mass consumption products. E. Print is not an effective medium for international advertising.

91. Sales promotion is growing in international markets due to: A. the deregulation and/or privatization of media. B. the number of avid sports fans around the world. C. increased global literacy. D. the way news media responds to press releases. E. increased risk taken by marketers.

92. Unlike advertising, which can be conducted on a global basis, sales promotion: A. should never include sales contests in global markets. B. offers better opportunities for salespeople than advertising. C. must be adapted to local markets. D. should avoid being adjusted for the level of economic development in a country. E. should challenge the existing trade structure.

93. Which of the following statements about the use of advertising and sales promotion in international markets is true? A. Advertising can often be done on a global basis while sales promotion must often be adapted to local markets. B. Sales promotion can often be done on a global basis while advertising must often be adapted to local markets. C. Advertising and sales promotion can be done either locally or globally with equal effectiveness. D. Sales promotion is most effective when done on a global basis. E. Advertising is subject to varying regulations in foreign markets but sales promotion is not.

94. Which of the following statements about international sales promotions is true? A. Because product sampling is so closely regulated, sampling is not effective outside the U.S. B. Event sponsorship is ineffective because of an absence of media needed to publicize the event. C. In many less developed countries, spending on sales promotions often exceeds media spending on television, radio and in print ads. D. Sales promotions must be done on a global basis for legal reasons. E. The economic environment does not influence the use or choice of sales promotions.

95. In many countries, sales promotion faces problems with distribution and retailers' resistance to processing coupons, setting up displays and dealing with premiums. These are sales promotion difficulties associated with: A. the country's stage of economic development. B. the country's market maturity. C. the country's consumer perceptions. D. the country's trade structure. E. the country's regulation.

96. Which of the following statements about the use of sales promotion tools in international markets is true? A. International marketers typically find coupons to be the best way to reach their target markets. B. Some countries limit the value of premium offers to a certain percentage of the retail price of the product. C. Laws governing sales promotion are more restrictive in the U.S. than in most foreign countries. D. Variations in rules and regulations among countries are minor and rarely require that marketers develop separate consumer sales promotions programs for individual countries. E. Sweepstakes are encouraged by national governments in virtually every country in Europe.

97. In 2006, the Harvard faculty pressured President Lawrence Summers into resigning. Some alumni were upset by this incident. Harvard will most likely use _____ to soothe alumni feelings. A. sampling B. public relations C. trade allowances D. couponing E. events sponsorship

98. _____ is the promotional function that deals with problems involving local governments, media, trade associations and the general public. A. Advertising B. Marketing C. Personal selling D. Sales promotion E. Public relations

99. Cartoon Network encountered problems introducing the cable channel to Scandinavian television because of opposition to the violent nature of some cartoons like those with the Road Runner and Tom and Jerry. Turner could have used _____ to counter negative publicity and communicate the company's commitment to non-violence. A. advertising B. sales promotion C. public relations D. direct mail E. the Internet

100. Which of the following statements about the international use of the Internet is true? A. The Internet cannot be efficiently used with an IMC program in the global marketplace. B. Many companies hope word-of-mouth advertising will encourage greater use of the Internet. C. The Internet is an important IMC tool for both large and small companies around the world. D. Though English is the native language for only 8 percent of the world's population, English is the language used in less than 20 percent of all e-commerce Web sites. E. During its formative years, the Internet was largely an Asian phenomenon.

Chapter 19 International Advertising and Promotion Answer Key

True / False Questions

1. (p. 641) International markets are important to small and mid-size companies as well as large multinational corporations. TRUE

International markets are important to small and mid-size companies as well as the large multinational corporations.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-01 To examine the importance of international marketing and the role of international advertising and promotion. Topic: The Importance of International Markets

2. (p. 645) Demographic data can provide insight into the living standards and lifestyles in a particular country to help companies plan ad campaigns. TRUE

Demographic data can provide insight into the living standards and lifestyles in a particular country to help companies plan ad campaigns.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-02 To review the various factors in the international environment and how they influence advertising and promotion decisions. Topic: The Demographic Environment

3. (p. 652) One of the main advantages of global marketing and advertising is economies of scale in production and distribution. TRUE

One of the main advantages of global marketing and advertising is economies of scale in production and distribution.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: Advantages of Global Marketing and Advertising

4. (p. 653) Product standardization results in higher production costs. FALSE

Product standardization results in lower design and production costs as well as greater marketing efficiency, which translates into lower prices for consumers.

5. (p. 653) Product standardization is becoming increasingly important as a result of longer product life cycles. FALSE

Product standardization and global marketing also enable companies to roll out products faster into world markets, which is becoming increasingly important as product life cycles become shorter and competition increases.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: Advantages of Global Marketing and Advertising

6. (p. 653) It is extremely easy to develop an effective universal approach to marketing and advertising a single product across the world. FALSE

Differences in culture, market, and economic development; consumer needs and usage patterns; media availabilities; and legal restrictions make it extremely difficult to develop an effective universal approach to marketing and advertising.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: Problems with Global Advertising

7. (p. 656) Products that are steeped in the cultural heritage of a country are best suited to worldwide appeals. FALSE

High-tech products and new products coming to the world for the first time are best suited for worldwide appeals, and not those steeped in the cultural heritage of a country.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: When is Globalization Appropriate?

8. (p. 656) Brands or messages that have a primarily verbal appeal are best suited for worldwide ad campaigns. TRUE

Brands or messages that can be adapted for a visual appeal, are best suited for worldwide appeals. These avoid the problems of trying to translate words into dozens of languages.

9. (p. 662) A centralized approach to organizing for advertising is not suitable when market and media conditions are similar from one country to another. FALSE

Complete centralization is likely when market and media conditions are similar from one country to another.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Organizing for Advertising

10. (p. 662) A decentralized approach to organizing for advertising should be adopted when the company can use standardized advertising. FALSE

Complete centralization is likely when market and media conditions are similar from one country to another, when the company has only one or a few international agencies handling all of its advertising, when the company can use standardized advertising, or when it desires a consistent image worldwide.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Organizing for Advertising

11. (p. 662) Many companies prefer a centralized organizational structure to keep control of the marketing effort and corporate and/or brand image. TRUE

Centralization may also be best when a company's international business is small and it operates through foreign distributors or licensees who do not become involved in the marketing and promotional process. Many companies prefer the centralized organizational structure to protect their foreign investments and keep control of the marketing effort and corporate and/or brand image.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Organizing for Advertising

12. (p. 662) Centralization of international advertising may also be best when a company operates through foreign distributors or licensees who do not become involved in the marketing and promotional process. TRUE

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Organizing for Advertising

Multiple Choice Questions

13. (p. 639) Which of the following factors is limiting growth opportunities in the U.S. market for many companies? A. Huge population growth B. Saturated markets for many products and services C. Low competition from domestic companies D. Low competition from foreign companies E. Large markets for foreign products

Companies are focusing on international markets for a number of reasons. Many companies in the United States and Western Europe recognize that their domestic markets offer them limited opportunities for expansion because of slow population growth, saturated markets, intense competition, and/or an unfavorable marketing environment.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 19-01 To examine the importance of international marketing and the role of international advertising and promotion. Topic: The Importance of International Markets

14. (p. 639) Many tobacco companies and breweries in the U.S. are focusing their efforts on international markets to sustain growth because of: A. high population growth, which leads to an unfavorable market environment. B. the unsaturated domestic market, which leaves little possibility for expansion. C. declining domestic consumption as a result of restrictions on their marketing and advertising efforts. D. the saturated markets in foreign countries. E. the high competition prevalent in foreign markets.

U.S. tobacco companies face declining domestic consumption as a result of restrictions on their marketing and advertising efforts and the growing antismoking sentiment in this country.

15. (p. 640) Had globalization not occurred, most European companies would not have been able to compete against larger U.S. and Japanese companies because of: A. the lack of funds among Europeans. B. the inability to achieve economies of scale owing to the small size of most of the European nations. C. the lack of education about international markets. D. the cultural differences prevailing amongst nations. E. the political and legal differences amongst the nations.

Most European nations are relatively small in size and, without foreign markets, would not have the economies of scale to compete against larger U.S. and Japanese companies.

16. (p. 640) Swiss-based Nestlé and Netherlands-based Unilever are two of the world's largest consumer-product companies as a result of: A. the favourable climatic conditions prevailing in the countries. B. the large population existing in these countries. C. the intense competition they face from domestic companies. D. their ability to market their brands to consumers around the world. E. their concentration on domestic markets and minimal expansion to international markets.

Swiss-based Nestlé and Netherlands-based Unilever are two of the world's largest consumer-product companies because they have learned how to market their brands to consumers in countries around the world.

17. (p. 641) The difference between the monetary value of a nation's exports and imports is its: A. added value. B. international trade. C. balance of trade. D. balance of payments. E. value of exports.

The United States has been running a continuing balance-of-trade deficit: the monetary value of its imports exceeds that of its exports.

18. (p. 641) A balance of trade deficit exists when the: A. value of imports exceeds that of exports. B. value of exports exceeds that of imports. C. supply of imports exceeds the demand for them. D. the value added by the exporting nation exceeds that added by the importing nation. E. the value of exports and imports are about equal.

The United States has been running a continuing balance-of-trade deficit; the monetary value of its imports exceeds that of its exports.

19. (p. 641) The U.S. has been experiencing a continuing balance of trade ____. This _____ the importance of international marketing efforts by U.S. companies. A. surplus; increases B. surplus; decreases C. deficit; increases D. deficit; decreases E. increase; increases

The United States has been running a continuing balance-of-trade deficit; the monetary value of its imports exceeds that of its exports.

20. (p. 642) The part of a firm's marketing functions that is the most visible to consumers as well as the most culture-bound is its: A. pricing. B. promotion. C. product development. D. distribution. E. inventory management.

As one international marketing scholar notes: Promotion is the most visible as well as the most culture bound of the firm's marketing functions.

21. (p. 642) Which of the following is an example of a major external environmental factor that a company must consider when analyzing the international marketing environment? A. economic factors B. product factors C. promotional factors D. pricing factors E. advertising factors

Just as with domestic marketing, companies engaging in international marketing must carefully analyze the major environmental factors of each market in which they compete, including economic, demographic, cultural, and political/legal variables.

22. (p. 643) Which of the following is a part of the economic environment of a foreign country? A. Language B. Values and ethics C. Currency stability D. Size of population E. Education levels

Currency stability is a part of the economic environment of a foreign country.

23. (p. 643) Which of the following is a cultural factor affecting international marketing? A. Currency stability B. Lifestyles C. Distribution of wealth D. Nationalism E. Government policies

Lifestyle of the people or nationals is a cultural factor affecting international environment.

24. (p. 643) _____ is an example of a cultural factor affecting international marketing. A. Laws B. Currency stability C. Income levels D. Language E. Government regulations

Language is a cultural factor affecting international environment.

25. (p. 643) Which of the following forms a part of the demographic environment of a country? A. Age distribution B. Distribution of wealth C. Lifestyles D. Norms and customs E. Exchange rates

Age distribution of the population forms a part of the demographic environment of a country.

26. (p. 643) The communications, transportation, financial and distribution networks of a country are part of its: A. political/legal environment. B. cultural environment. C. economic infrastructure. D. demographic environment. E. international interface.

Developed countries have the economic infrastructure in terms of the communications, transportation, financial, and distribution networks needed to conduct business in these markets effectively.

27. (p. 643) For companies wishing to enter a new market, a country's economic conditions indicate its ____, since products and services can be sold only to countries where there is enough income to buy them. A. size of population B. attitudes towards multinationals C. cultural norms and values D. present and future potential for consuming E. occupation distribution

A country's economic conditions indicate its present and future potential for consuming, since products and services can be sold only to countries where there is enough income to buy them.

28. (p. 643) When the CEO of International Partners, Ltd. was in Katmandu, the capital of Nepal, he found that 90 percent of his telephone calls didn't connect to the party he was calling. This represents a problem with Nepal's: A. demographic environment. B. economic infrastructure. C. balance of payments. D. cultural system. E. advertising system.

Developed countries have the economic infrastructure in terms of the communications, transportation, financial, and distribution networks needed to conduct business in these markets effectively.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 19-02 To review the various factors in the international environment and how they influence advertising and promotion decisions. Topic: The Economic Environment

29. (p. 643) A U.S. executive in Namibia in Africa experienced trouble negotiating a franchise deal with local investors because the electricity was constantly shutting off. One of the investors was unable to attend the meeting because there is so little public transportation in the country. These problems indicate a problem with Namibia's: A. demographic environment. B. economic infrastructure. C. balance of payments. D. cultural system. E. advertising system.

Developed countries have the economic infrastructure in terms of the communications, transportation, financial, and distribution networks needed to conduct business in these markets effectively.

30. (p. 644) China and India in particular are two countries that are transforming the global economy. One of the main reasons for this is: A. high population growth rate. B. lack of savings habit among the nations. C. less demand and needs. D. lower economic growth rates. E. lack of demand for luxury items.

China and India in particular are two countries that are transforming the global economy. Each country has the fundamentals to sustain the high growth rates including young populations, high savings, and a growing number of consumers who have the ability to purchase, as well as the need for, many products.

31. (p. 645) Factors such as size of the population, age distribution, education, and income levels are part of a country's _____ characteristics. A. economic B. demographic C. cultural D. political/legal E. lifestyle

Major demographic differences exist among countries as well as within them. Marketers must consider income levels and distribution, age and occupation distributions of the population, household size, education, and employment rates.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 19-02 To review the various factors in the international environment and how they influence advertising and promotion decisions. Topic: The Demographic Environment

32. (p. 645) In the past few years, international toy manufacturers have been targeting the South American market as a result of the growth in the youngest segment of the population. Which of the following factors has influenced this decision? A. Psychographic factors B. Geographic factors C. Demographic factors D. Cultural factors E. Legal factors

Demographic information can reveal the market potential of various foreign markets. Children are the fastest-growing segment of the Latin American market. These numbers have caught the attention of international advertisers such as Mattel, Hasbro, Burger King, and others.

AACSB: Analytic Bloom's: Understand Difficulty: Easy Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: The Demographic Environment

33. (p. 645) A U.S. exporter of baby furniture is planning to export its products to another country. The company wants to know how many people are in the Full Nest I stage of the family life cycle in that country. This type of information is part of a nation's _____ environment. A. economic B. demographic C. cultural D. political/legal E. lifestyle

34. (p. 645) _____ variables marketers must consider include language, customs, tastes, attitudes, lifestyles, values, and ethical/moral standards. A. Demographic B. Economic C. Political D. Cultural E. Legal

Cultural variables marketers must consider include language, customs, tastes, attitudes, lifestyles, values, and ethical/moral standards.

35. (p. 645) The Polaroid Corporation encountered great problems when it attempted to market instant cameras in France. The French consumer saw little need for having a picture developed instantly. This indicates Polaroid did not understand the French _____ environment. A. demographic B. economic C. cultural D. political/legal E. media

Cultural variables marketers must consider include language, customs, tastes, attitudes, lifestyles, values, and ethical/moral standards. Marketers must be sensitive not only in determining what products and services they can sell foreign cultures but also in communicating with them.

36. (p. 645) Variables such as language, customs, tastes, values and lifestyles are part of a country's: A. cultural environment. B. infrastructure. C. demographic environment. D. regulatory environment. E. political/legal environment.

Cultural variables marketers must consider include language, customs, tastes, attitudes, lifestyles, values, and ethical/moral standards.

37. (p. 645) _____ factors of the international environment probably create more problems for advertisers than any others since they directly impact the ability to communicate effectively with consumers in foreign countries. A. Demographic B. Economic C. Cultural D. Political E. Marketing mix

Advertising is often the most effective way to communicate with potential buyers and create markets in other countries. But it can also be one of the most difficult aspects of the international marketing program because of problems in developing messages that will be understood in various countries due to differences in culture.

38. (p. 645) Most Asian women are shy about their bodies. This would be important _____ information to a company like Victoria's Secret as it expands into Korean markets. A. demographic B. economic C. cultural D. political E. infrastructure

39. (p. 645) To market on the Belgian home shopping channel, advertisers have to prepare programs in Flemish (a version of Dutch), Dutch and German because all three languages are commonly spoken in Belgium. This language difficulty represents a _____ problem for a U.S. company trying to sell its products on the Belgian home shopping channel. A. demographic B. economic C. infrastructure D. political E. cultural

Cultural variables marketers must consider include language, customs, tastes, attitudes, lifestyles, values, and ethical/moral standards.

40. (p. 645) A delivery service must understand that as a result of _____ differences, Europeans are not as time-sensitive as Americans, and Asians are even less time-sensitive than Europeans. A. economic B. demographic C. political D. cultural E. infrastructure

Cultural variables marketers must consider include language, customs, tastes, attitudes, lifestyles, values, and ethical/moral standards.

41. (p. 646) The only South American country where Coca-Cola is not the market leader is Peru, where local tastes prefer Inca Kola. Inca Kola is golden-yellow in color and tastes like banana-flavored bubble gum. Which environmental factor is most responsible for the fact Coca-Cola does not sell well in Peru? A. Economic B. Demographic C. Political D. Cultural E. Infrastructure

Tastes, traditions, and customs are also an important part of cultural considerations.

42. (p. 647) In France, cosmetics are used heavily by men as well as women and advertising directed to the male market is common. Consumers in the U.S. are heavier users of personal hygiene products such as deodorants and mouthwashes. These are examples of _____ differences that affect consumption patterns. A. demographic B. economic C. cultural D. regulatory E. generic

In France, cosmetics are used heavily by men as well as women, and advertising to the male market is common. There are also cultural differences in the grooming and hygiene habits of consumers in various countries. For example, unlike in many other countries, many U.S. consumers use products like deodorant and shampoo daily.

43. (p. 647) _____ refers to the tendency of individuals to view their own group or society as the center of the universe. A. Central perception B. Halo effect C. Origin-of-country effect D. Ethnocentrism E. Xenocentrism

Values such as ethnocentrism, which refers to the tendency for individuals to view their own group or society as the center of the universe, often affect the way consumers in various countries respond to foreign brands.

44. (p. 647) Which of the following statements about cultural values is true? A. In today's globalized market, cultural differences are negligible. B. The values and beliefs of a society can affect its members' receptivity toward foreign products and services. C. Cultural values are personal values and are only applicable on an individual level. D. A highly ethnocentric culture will be extremely receptive to foreign products. E. Cultural values have no effect on the market or consumer behavior.

Cultural values are beliefs and goals shared by members of a society regarding ideal end states of life and modes of conduct. Values and beliefs of a society can also affect its members' attitudes and receptivity toward foreign products and services.

45. (p. 647) A beverage company entered a new market in which it saw great potential. However, though its products matched those of local competitors in quality and price, sales were sluggish. The company realized that consumers believed that the local brands were better just because they were local. It had failed to account for the _____ of the consumers during the planning process. A. demographics B. ethnocentrism C. pluralism D. cultural relativism E. xenocentrism

Values such as ethnocentrism, which refers to the tendency for individuals to view their own group or society as the center of the universe, or nationalism often affect the way consumers in various countries respond to foreign brands.

46. (p. 647) In the U.S., promotions for Agile Sports products emphasize individualism and independence. In Japan, however, the company had to change its message to one that focused on team values and cooperation, due to the differing _____ in the two countries. A. demographics B. religious beliefs C. cultural values D. ethics E. lifestyles

Cultural values are beliefs and goals shared by members of a society regarding ideal end states of life and modes of conduct. Cultural values in the United States place a major emphasis on individual activity and initiative, while many Asian societies stress cooperation and conformity to the group.

47. (p. 648) U.S. brands have become popular in many other European countries as well as in Asia. Marketers attribute the rising popularity of many U.S.-made products to: A. the increased familiarity of foreign nationals with American culture, values, and lifestyles. B. their superior quality. C. the low prices of the products. D. the centralized organizational approach adopted by most U.S companies. E. the increasingly ethnocentric attitude of the consumers around the world.

Marketers attribute the rising popularity of many U.S.-made products to the worldwide distribution of American music, films, and TV shows; the growth of the Internet; and the increase in travel to the United States. These factors have made consumers in foreign countries more familiar with American culture, values, and lifestyle.

48. (p. 649) Chinese values are centered around ____, which stresses loyalty and interpersonal relationships. A. ethnocentrism B. Confucianism C. the country-of-origin effect D. the halo effect E. xenocentrism

Chinese values are centered around Confucianism, which stresses loyalty and interpersonal relationships.

49. (p. 650) To reach out to the youth market in the Middle East, Coca-Cola and Pepsi have: A. pressured area governments into creating a single set of laws on advertising in the Middle East and established strict policies for their enforcement. B. called for each Middle Eastern country to determine its own policies on advertising regulation. C. used a variety of IMC tools including sponsorships and branded entertainment. D. emphasized their association with America and American foreign policies. E. targeted parents because of their strong influence on teenagers' consumption preferences.

To reach the youth market, Coca-Cola and Pepsi corporations have used a variety of integrated marketing tools including media advertising, sponsorship of sports teams as well as sporting and musical events, and talent shows as well as branded entertainment.

50. (p. 650) An American sporting goods manufacturer wanting to sell on the Belgian home shopping channel would find that different laws govern the people who live in the Flemish communities, the German communities and the French communities that exist in the nation. For instance, in the French-speaking community of Walloon in Belgium, the home shopping channel is legal. It is an illegal operation, however, in Flanders, the area of the country where Flemish is spoken. This is an example of how _____ factors affect global marketing. A. economic B. demographic C. political/legal D. cultural E. infrastructure

The political and legal environment in a country is one of the most important factors influencing the advertising and promotional programs of international marketers. Regulations differ owing to economic and national sovereignty considerations, nationalistic and cultural factors, and the goal of protecting consumers not only from false or misleading advertising but, in some cases, from advertising in general.

51. (p. 650) Since the European Union banned the use of food dyes in seafood, the salmon market has suffered. People mistakenly believe that salmon is naturally pink. Unfortunately, salmon is an unappetizing gray color. This is an example of how _____ factors can inadvertently hurt small businesses. A. economic B. demographic C. political/legal D. geographic E. infrastructure

Government regulations and restrictions can affect various aspects of a company's advertising program, including the types of products that may be advertised, the content or creative approach that may be used, use of foreign languages in ads, use of advertising material prepared outside the country etc.

52. (p. 650) Diet Coke is known as Coca-Cola Light in Germany, France and many other countries because these countries have legal restrictions prohibiting the use of the word diet. This is an example of how _____ factors affect global marketing. A. economic B. demographic C. political/legal D. cultural E. infrastructure

Government regulations and restrictions can affect various aspects of a company's advertising program, including the types of products that may be advertised, the use of foreign languages in ads, etc. Many governments have rules and regulations that affect the advertising message.

53. (p. 651) _____ is a strategy of advertising in which certain banned products are indirectly advertised by labeling a non-banned product with a familiar logo so as to develop brand image and easy recall. A. Aerial advertising B. Transit advertising C. Surrogate advertising D. Cross-selling E. Ethnocentrism

The advertising of tobacco and liquor is banned in India although many companies have tried to get around the ban by using what are known as "surrogate advertisements." Instead of promoting tobacco and liquor products, these TV commercials and print ads market unrelated products that the company also happens to manufacture that carry the same brand name and allow them to build brand awareness.

AACSB: Reflective Thinking Bloom's: Understand Difficulty: Medium Learning Objective: 19-02 To review the various factors in the international environment and how they influence advertising and promotion decisions. Topic: The Political/Legal Environment

54. (p. 651) The UB Group named its airline business Kingfisher, after its popular beer brand of the same name. This is one of the most successful examples of ____. The extension of the Kingfisher brand to the airline gave a great push to the original category, beer, which cannot be advertised in many parts of the world. A. ethnocentrism B. subliminal perception C. aerial advertising D. surrogate advertising E. puffery

The advertising of tobacco and liquor is banned in India although many companies have tried to get around the ban by using "surrogate advertisements." These TV commercials and print ads market unrelated products that the company also manufactures. These products carry the same brand name and allow the companies to build brand awareness.

55. (p. 652) _____ is a marketing approach that assumes that the needs satisfied by a product or service and the way it is used are the same everywhere in the world, and therefore utilizes a common approach in all countries. A. Global marketing B. Complementary marketing C. Localized marketing D. Nationalized marketing E. Countertrading

In recent years, a great deal of attention has focused on the concept of global marketing, where a company uses a common marketing plan for all countries in which it operates, thus selling the product in essentially the same way everywhere in the world.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: Global Versus Localized Advertising

56. (p. 652) The concept of ______ deals with all elements of a firm's marketing mix while the concept of _____ deals specifically with the communication aspect of marketing. A. global marketing: global advertising B. global advertising: standardization C. global advertising: global marketing D. standardization: global marketing E. adaptation: standardization

Global marketing occurs when a company uses a common marketing plan for all countries in which it operates and global advertising falls under the umbrella of global marketing as a way to implement this strategy by using the same basic advertising approach in all markets.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: Global Versus Localized Advertising

57. (p. 652) _____ was the marketing scholar who popularized the concept of global marketing. A. Phillip Kotler B. John Naisbitt C. Theodore Levitt D. Peter Drucker E. Robert Holloway

The idea of global marketing was popularized by Professor Theodore Levitt.

58. (p. 653) Production standardization leads to: A. high production costs. B. lower prices of products. C. lower marketing efficiency. D. increased competition. E. higher lead times.

Product standardization results in lower design and production costs as well as greater marketing efficiency, which translates into lower prices for consumers.

59. (p. 656) British Airways believes it is very difficult to differentiate itself from other major airlines on the basis of schedules, routes and price. However, the airline thinks it can be differentiated on the basis of service and has decided to focus much of its effort on image advertising using the theme "The World's Favorite Airline". Which of the following is correct regarding this type of advertising campaign? A. This campaign will definitely require a localized approach with different ads for each country. B. This campaign could easily be adapted to a global campaign since the focus is on service and image, which are easily understood by airline passengers in all countries. C. This campaign will require a localized strategy since perceptions of service will definitely be different among airline passengers in every country. D. British Airlines should forget the service campaign and focus on price since international flights are chosen on a price basis. E. The campaign will definitely fail as ‘service' is intangible.

Marketers recognize that emotions such as joy, sentiment, excitement, and pleasure are universal as are needs/values such as self-esteem, status, and achievement. Thus, it is common for global advertising campaigns to use emotional and image appeals.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: When is Globalization Appropriate?

60. (p. 656) For which of the following will worldwide appeals NOT be appropriate? A. Brands or messages that have great visual appeal B. Image campaigns that play to universal needs, values, and emotions. C. High-tech products and new products D. Products that evoke the country-of-origin effect E. Products that are steeped in cultural traditions and significance

High-tech products and new products coming to the world for the first time can be advertised with worldwide appeals, but products steeped in the cultural heritage of a country cannot.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Medium Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: When is Globalization Appropriate?

61. (p. 657) Products such as Swiss watches, German automobiles and French wines are automatically assumed to be superior to similar products from other countries because: A. they are all high-tech products. B. they appeal to market segments with universal tastes and interests. C. they come from countries that have strong reputations for making these products. D. they can be advertised using totally visual appeals. E. they appeal to a market segment with universally similar tastes, interests, needs, and values.

Products that come from countries with national reputations for quality and/or a distinctive image that can be used as the basis for global advertising. Examples include Swiss watches, French wine, and German beer or automobiles.

62. (p. 657) Products from countries with national reputations for quality and/or a distinctive image that can be used as the basis for global advertising capitalize on the: A. ability to cross-sell. B. country-of-origin effect. C. customary and accepted perception. D. self-regulation of global images rule. E. Central Hudson test.

Products that come from countries with national reputations for quality and/or a distinctive image that can be used as the basis for global advertising. These products capitalize on the country-of-origin effect which refers to consumers' general perceptions of quality for products made in a given country.

63. (p. 657) _____ refers to consumers' general perceptions of quality for products made in a given country. A. Cross-selling B. Country-of- origin effect C. Halo effect D. Global imaging E. Central Hudson test

The country-of-origin effect refers to consumers' general perceptions of quality for products made in a given country.

64. (p. 660) _____ is an advertising format where ads follow the same basic approach but themes, copy, and visual elements may be adjusted. A. Global advertising B. Local advertising C. Pattern advertising D. Formatted advertising E. Ad standardization

Many global marketers use a strategy called pattern advertising; their ads follow a basic approach, but themes, copy, and sometimes even visual elements are adapted to differences in local markets.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-03 To consider the pros and cons of global versus localized marketing and advertising. Topic: Global Products, Local Messages

65. (p. 660) The _____ approach recognizes similar desires, goals, needs, and uses for products and services, but tailors advertising to the local cultures and conditions in each market. A. concentrated marketing B. think globally, act locally C. localized D. domestic E. globalized marketing

"Think globally, act locally" approach recognizes similar desires, goals, needs, and uses for products and services but tailors advertising to the local cultures and conditions in each market.

66. (p. 660) Weight Watchers, having achieved a 50 percent market share in the United States, was ready to move into international markets. The company found it had to introduce new diets and weight-loss measures on a country-by-country basis even though it maintained its basic ad campaign. Weight Watchers used: A. localized advertising. B. consistency advertising. C. a standardized formatting strategy. D. pattern advertising. E. undifferentiated marketing.

Many global marketers use a strategy called pattern advertising; their ads follow a basic approach, but themes, copy, and sometimes even visual elements are adapted to differences in local markets.

67. (p. 661) Gillette had a worldwide advertising campaign for its Sensor razors using the ad campaign theme "Gillette—the best a man can get." Some of the ads featured sports stars from the host country rather than using only one sports star in all of the ads. This is an example of a(n): A. localized advertising approach. B. application of the "think global, act regionally" approach to international advertising. C. totally global or standardized approach. D. totally customized approach. E. ethnocentric approach to advertising.

In case of the "think globally, act regionally" strategy, although many marketers are striving to develop global brands, most are doing so by using a localized approach. There is a trend toward giving regional offices the autonomy to adapt the global theme for their local markets.

68. (p. 661) The dominant strategy used by most international advertisers today is to: A. centralize all of the marketing mix elements except promotion. B. use localized advertising. C. "think locally and act globally". D. "think globally and act regionally". E. use standardized advertising.

A more recent study of international advertising decision makers found that "think globally, act locally" still appears to be the dominant strategy of international advertisers, but with a slight revision: "Think globally, act regionally."

69. (p. 662) Three basic options for organizing international marketing are: centralization at the home office or headquarters, decentralization of decision-making to local foreign markets, and: A. centralization at local foreign markets. B. centralization at regional markets. C. decentralization of headquarters. D. a combination of centralization and decentralization. E. decentralization of regional offices.

Three basic options for organizing international marketing are centralization at the home office or headquarters, decentralization of decision-making to local foreign markets, or a combination of the two.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Organizing for International Advertising

70. (p. 662) In case of a _____ approach to international advertising and promotion function, all decisions about agency selection, research, creative strategy and campaign development, media strategy, and budgeting are made at the firm's home office. A. centralized B. decentralized C. localized D. combination E. regional

Many companies prefer to centralize the international advertising and promotion function so that all decisions about agency selection, research, creative strategy and campaign development, media strategy, and budgeting are made at the firm's home office.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Organizing for International Advertising

71. (p. 662) Complete _____ of international advertising is likely when market and media conditions are similar from one country to another, when the company has only one or a few international agencies handling all of its advertising, when the company can use standardized advertising, or when it desires a consistent image worldwide. A. localization B. globalization C. decentralization D. centralization E. regionalization

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Organizing for International Advertising

72. (p. 662) Automated Logic Systems manufactures high-tech building automation systems and sells them to Latin American and Asian buyers. The company has decided to use _____ and make all major strategy and budgeting decisions at the home office. A. a centralized organizational structure B. a decentralized organizational structure C. a combination structure D. a localized structure E. combination marketing

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Organizing for International Advertising

73. (p. 662) Allise Industries manufactures and exports copper wiring to markets all over the world. It has adopted an advertising organizational structure in which its managers in each country or region have the authority to make decisions for their market. Allise Industries has a _____ organizational structure. A. centralized B. decentralized C. matrix D. individualized E. globalized

Under a decentralized organizational structure, marketing and advertising managers in each market have the authority to make their own advertising and promotional decisions.

74. (p. 662) In planning advertising for the 2008 Olympics, international travel agencies discovered they needed to use different ad campaigns to appeal to travelers from different countries. Americans wanted a trip that allowed them to have an extended stay. Japanese travelers went to attend specific events and wanted to return home as soon as the events were over. Global travel agencies gave the managers of their foreign offices the authority to develop country-appropriate advertising. This is an example of how a _____ advertising organizational structure works. A. centralized B. decentralized C. pattern D. globalized E. matrix

Under a decentralized organizational structure, marketing and advertising managers in each market have the authority to make their own advertising and promotional decisions.

75. (p. 662) In which of the following cases would centralization of the advertising function be a disadvantage? A. When the advertiser wants to maintain a consistent brand image across markets. B. When the advertiser wants to keep control of its brand message and image. C. When the product is a high-technology product with universal appeal. D. When the market conditions in the various markets differ widely. E. When the company wants to save costs.

Many marketing and advertising managers in foreign markets oppose centralized control. They say the structure is too rigid and makes it difficult to adapt the advertising and promotional program to local needs and market conditions.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Agency Selection

76. (p. 663) For its international advertising, Levi Strauss & Co. uses an organizational approach in which a vice president of global marketing who oversees the company's marketing program in 60 countries but still provides autonomy to local and regional marketing directors. This is an example of a: A. centralized approach. B. totally global approach. C. decentralized approach. D. combination of the centralized and decentralized approaches. E. matrix network.

While there is an increasing trend toward centralizing the international advertising function, many companies combine the two approaches. The home office, or headquarters, has the most control over advertising policy, guidelines, and operations in all markets.

77. (p. 663) When beginning an international marketing campaign, many American companies prefer to use an international ad agency based in the U.S. with foreign offices in other countries. This is because: A. U.S. agencies are the most creative. B. U.S. agencies understand world markets better than foreign agencies do. C. agencies based in the U.S. give the advertiser better control of the advertising process and facilitate the coordination of international advertising. D. U.S.-based agencies generally understand local markets better than agencies located in these countries. E. the U.S. culture is the most used as a basis for understanding other cultures.

Many American companies prefer to use a U.S.-based agency with foreign offices; this gives them greater control and convenience and also facilitates coordination of overseas advertising.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Agency Selection

78. (p. 664) Why are global marketers consolidating their advertising into one agency? A. To implement the philosophies of Theodore Levitt. B. Due to terrorists' activities in other parts of the world. C. Because the importance of cultural barriers has declined significantly. D. Because agencies now have the ability to communicate globally. E. In order to distribute costs among the different participating countries.

Companies are also consolidating their global advertising in an effort to increase cost efficiencies and gain greater leverage over their agencies. A major reason for all of the account consolidation is that agencies now have the ability to communicate and manage globally.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Agency Selection

79. (p. 665) Marketers who think it is important to have advertising done by an agency that has a very good understanding of each international market in which it sells its products are likely to use a(n): A. U.S.-based international agency. B. U.S.-based agency with regional offices that could serve each country. C. local agency for each national market. D. in-house agency. E. specialty agency.

Since local agencies often have the best understanding of the marketing and advertising environment in their country or region, they may be able to develop the most effective advertising.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Agency Selection

80. (p. 665) When Campbell's introduced its condensed soup in Great Britain it made no changes to the product as we know it in the U.S. The British, however, thought the soup was expensive and in very small cans—they were unaware of the need to add water. When this campaign was developed, Campbell's undoubtedly did not use: A. a centralized approach to its advertising. B. local agency for each national market. C. a public relations agency. D. creative boutiques. E. a hierarchical approach to its advertising.

Since local agencies often have the best understanding of the marketing and advertising environment in their country or region, they may be able to develop the most effective advertising.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Agency Selection

81. (p. 665) In the United States, people with golden tans are generally seen as attractive and possibly even well-to-do. However, in other countries, such as the Philippines, suntans are indicative of laborers and underprivileged people. A U.S. company planning on marketing a line of tanning lotions, bronzing creams, and salves for sunburns globally realizes it is important to select an advertising agency that truly understands each foreign market. The company should: A. use a U.S.-based international agency. B. use a U.S. based agency that has a few offices in foreign countries. C. use local agencies for each country it wants to enter. D. use a superagency with global marketing capabilities. E. use a globalized marketing strategy.

Since local agencies often have the best understanding of the marketing and advertising environment in their country or region, they may be able to develop the most effective advertising.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Agency Selection

82. (p. 666) The primary reason many companies do not conduct advertising research in international markets is due to: A. the language differences. B. high costs. C. efficiencies of scale. D. the fear of losing a competitive advantage. E. the lack of local advertising agencies.

Many companies do not conduct advertising research in international markets. Probably the main reason for this is the high cost of conducting research in foreign markets, coupled with the limited budgets many firms have for international advertising and promotion.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Advertising Research

83. (p. 666) During a World Cup soccer match, both McDonald's and Coca-Cola made the mistake of reprinting the Saudi Arabia flag, which includes sacred words from the Koran, on disposable packaging used in promotions. The uproar over this misuse of a cultural symbol forced a recall of the offending items. _____ could have prevented this recall. A. Advertising research B. Dyadic communication C. Creative decision-making D. A global approach to advertising E. A centralized approach to advertising

As companies increase their investment in international marketing, they are recognizing the importance of conducting marketing and advertising research to better understand the characteristics and subtleties of consumers in foreign markets.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Advertising Research

84. (p. 666) The U.S. federal government agency that works closely with U.S. companies to help them sell their products and services to foreign markets is the: A. Federal Trade Commission. B. Overseas Business Commission. C. U.S. Department of Commerce. D. United Nations. E. National Chamber of Commerce.

One of the most valuable sources of information for companies based in this country is the U.S. Department of Commerce, which works closely with American companies to help them sell their products overseas through its International Trade Administration (ITA) division.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Advertising Research

85. (p. 666) Which of the following types of marketing information would be most difficult to find in foreign markets, especially in developing countries? A. Demographic characteristics B. Information on economic conditions C. Information on cultural norms and values D. Information on consumers' product usage, brand attitudes and media preferences and usage E. Information on population size and characteristics

Information on product and brand attitudes, usage patterns, and media habits is generally more difficult to find, particularly in developing countries.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Advertising Research

86. (p. 666) The _____ is an annual report that provides demographic and economic data on more than 200 countries. A. Predicast Report B. NCH Promotional Services Report C. World Population Report D. United Nations Statistical Yearbook E. International Marketing Handbook

The United Nations Statistical Yearbook, which is published annually, provides demographic and economic data on more than 200 countries.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Advertising Research

87. (p. 667) Which of the following statements about making creative decisions for international advertising is true? A. The creative approach used in a company's primary market usually will transfer well to foreign markets. B. Creative strategies may have to be different for each market depending on factors such as consumers' usage patterns, cultural backgrounds and lifestyles. C. Emotional appeals such as humor work well in virtually any country. D. Sexual appeals work very well in nearly every country. E. Dramatization ads work well only in United States and Europe.

A product may have to be positioned differently in each market depending on consumers' usage patterns and habits.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Creative Decisions

88. (p. 667) If advertisers use a ____, the agency will know that humorous advertising appeals are popular in the United Kingdom but German consumers do not respond well to them. A. global marketing strategy B. sales promotion tactic C. global public relations strategy D. localized advertising strategy E. centralized marketing strategy

When companies follow a localized advertising strategy, the creative team must determine what type of selling idea, ad appeal, and execution style will work in each market.

AACSB: Analytic Bloom's: Understand Difficulty: Medium Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Creative Decisions

89. (p. 667) When companies follow a ____, the creative team must determine what type of selling idea, ad appeal, and execution style will work in each market. A. global marketing strategy B. sales promotion tactic C. global public relations strategy D. localized advertising strategy E. centralized marketing strategy

When companies follow a localized advertising strategy, the creative team must determine what type of selling idea, ad appeal, and execution style will work in each market.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Creative Decisions

90. (p. 671) Time Inc., has launched new editions of Sports Illustrated and InStyle in China; People and Sports Illustrated in India; Fortune in Korea; and InStyle in Thailand. Which of the following is true for advertisers in these magazines? A. As these are international publications, cultural differences between markets will be negligible. B. Readers of these publications are usually upscale, high-income individuals who are desirable target markets for many products. C. Their reach in foreign countries will be extremely high. D. The magazines offer an excellent advertising medium for marketers of mass consumption products. E. Print is not an effective medium for international advertising.

International publications offer advertisers a way to reach large audiences on a regional or worldwide basis. Readers of these publications are usually upscale, high-income individuals who are desirable target markets for many products and services.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-04 To examine the various decision areas of international advertising. Topic: Media Selection

91. (p. 672) Sales promotion is growing in international markets due to: A. the deregulation and/or privatization of media. B. the number of avid sports fans around the world. C. increased global literacy. D. the way news media responds to press releases. E. increased risk taken by marketers.

The growth of sales promotion stems from the liberalization of trade, the rise of global brands, the spread of cable and satellite TV, and the deregulation and/or privatization of media.

AACSB: Analytic Bloom's: Remember Difficulty: Easy Learning Objective: 19-05 To understand the role of other promotional mix elements in the international integrated marketing communications program. Topic: Sales Promotion

92. (p. 672) Unlike advertising, which can be conducted on a global basis, sales promotion: A. should never include sales contests in global markets. B. offers better opportunities for salespeople than advertising. C. must be adapted to local markets. D. should avoid being adjusted for the level of economic development in a country. E. should challenge the existing trade structure.

Unlike advertising, which can be done on a global basis, sales promotions must be adapted to local markets.

93. (p. 672) Which of the following statements about the use of advertising and sales promotion in international markets is true? A. Advertising can often be done on a global basis while sales promotion must often be adapted to local markets. B. Sales promotion can often be done on a global basis while advertising must often be adapted to local markets. C. Advertising and sales promotion can be done either locally or globally with equal effectiveness. D. Sales promotion is most effective when done on a global basis. E. Advertising is subject to varying regulations in foreign markets but sales promotion is not.

Unlike advertising, which can be done on a global basis, sales promotions must be adapted to local markets.

94. (p. 672) Which of the following statements about international sales promotions is true? A. Because product sampling is so closely regulated, sampling is not effective outside the U.S. B. Event sponsorship is ineffective because of an absence of media needed to publicize the event. C. In many less developed countries, spending on sales promotions often exceeds media spending on television, radio and in print ads. D. Sales promotions must be done on a global basis for legal reasons. E. The economic environment does not influence the use or choice of sales promotions.

In many less developed countries, spending on sales promotion often exceeds media spending on TV, radio, and print ads.

95. (p. 673) In many countries, sales promotion faces problems with distribution and retailers' resistance to processing coupons, setting up displays and dealing with premiums. These are sales promotion difficulties associated with: A. the country's stage of economic development. B. the country's market maturity. C. the country's consumer perceptions. D. the country's trade structure. E. the country's regulation.

Retailers in many countries do not want to take time to process coupons, post promotional displays, or deal with premiums or packaging that require special handling or storage. This is due to the trade structures prevailing in those countries.

96. (p. 673; 674) Which of the following statements about the use of sales promotion tools in international markets is true? A. International marketers typically find coupons to be the best way to reach their target markets. B. Some countries limit the value of premium offers to a certain percentage of the retail price of the product. C. Laws governing sales promotion are more restrictive in the U.S. than in most foreign countries. D. Variations in rules and regulations among countries are minor and rarely require that marketers develop separate consumer sales promotions programs for individual countries. E. Sweepstakes are encouraged by national governments in virtually every country in Europe.

Some countries ban contests, games, or lotteries, while others restrict the size or amount of a sample, premium, or prize. For example, fair-trade regulations in Japan limit the maximum value of premiums to 10 percent of the retail price.

97. (p. 674) In 2006, the Harvard faculty pressured President Lawrence Summers into resigning. Some alumni were upset by this incident. Harvard will most likely use _____ to soothe alumni feelings. A. sampling B. public relations C. trade allowances D. couponing E. events sponsorship

Public relations activities are needed to deal with local governments, media, trade associations, and the general public, any of which may feel threatened by the presence of a foreign multinational.

AACSB: Reflective Thinking Bloom's: Apply Difficulty: Hard Learning Objective: 19-05 To understand the role of other promotional mix elements in the international integrated marketing communications program. Topic: Public Relations

98. (p. 674) _____ is the promotional function that deals with problems involving local governments, media, trade associations and the general public. A. Advertising B. Marketing C. Personal selling D. Sales promotion E. Public relations

Public relations activities are needed to deal with local governments, media, trade associations, and the general public, any of which may feel threatened by the presence of a foreign multinational.

99. (p. 674) Cartoon Network encountered problems introducing the cable channel to Scandinavian television because of opposition to the violent nature of some cartoons like those with the Road Runner and Tom and Jerry. Turner could have used _____ to counter negative publicity and communicate the company's commitment to non-violence. A. advertising B. sales promotion C. public relations D. direct mail E. the Internet

Public relations activities are needed to deal with local governments, media, trade associations, and the general public, any of which may feel threatened by the presence of a foreign multinational.

100. (p. 675) Which of the following statements about the international use of the Internet is true? A. The Internet cannot be efficiently used with an IMC program in the global marketplace. B. Many companies hope word-of-mouth advertising will encourage greater use of the Internet. C. The Internet is an important IMC tool for both large and small companies around the world. D. Though English is the native language for only 8 percent of the world's population, English is the language used in less than 20 percent of all e-commerce Web sites. E. During its formative years, the Internet was largely an Asian phenomenon.

The Internet is coming of age as a global marketing medium and is becoming an important IMC tool for companies around the world, both large and small.

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