Chapter 08. Products, Services, and Brands: Building Customer Value

Chapter
08. Products, Services, and Brands: Building Customer Value
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1) A ________ is defined as anything that can be offered to a market for attention, acquisition, use, or
consumption and that might satisfy a want or need.
A) private brand
B) service variability
C) service
D) product
E) service encounter
Answer: D
Diff: 1 Page Ref: 204
AACSB: Communication
Skill: Concept
Objective: 8-1
2) ________ are a form of product that consists of activities, benefits, or satisfactions offered for sale that are
essentially intangible and do not result in the ownership of anything.
A) Line extensions
B) Services
C) Brands
D) Consumer products
E) Supplements
Answer: B
Skill: Concept
Objective: 8-1
3) A product is a key element in the ________. At one extreme, it may consist of pure tangible goods or at the
other extreme, pure services.
A) market offering
B) brand equity
C) brand extension
D) co-branding
E) value chain
Answer: A
Skill: Concept
Objective: 8-1
1
4) To differentiate themselves, many companies are going beyond products and services, and are developing and
delivering customer ________.
A) quality
B) experiences
C) brands
D) product lines
E) events
Answer: B
Skill: Concept
Objective: 8-1
5) Product planners need to consider products and services on three levels. Each level adds more customer value.
The most basic level is the ________, which addresses the question, ʺWhat is the buyer really buying?ʺ
A) actual product
B) augmented product
C) core customer value
D) co-branding
E) exchange
Answer: C
Skill: Concept
Objective: 8-1
6) The third level of a product that product planners must consider is a(n) ________ around the core benefit and
the actual product, that offers additional consumer services and benefits.
A) brand equity
B) augmented product
C) brand extension
D) industrial product
E) image
Answer: B
Skill: Concept
Objective: 8-1
7) Product planners must design the actual product and find ways to ________ it in order to create the bundle of
benefits that will provide the most satisfying customer experience.
A) promote B) package C) brand D) augment E) present
Answer: D
Skill: Concept
Objective: 8-1
2
8) Products and services fall into two broad classifications based on the types of consumers that use them. Which
is one of these broad classes?
A) industrial products
B) specialty products
C) supplies and services
D) materials and parts
E) convenience products
Answer: A
AACSB:
Skill: Concept
Objective: 8-1
9) ________ are products and services bought by final consumers for personal consumption. These include
convenience products, shopping products, specialty products, and unsought products.
A) Services
B) Consumer products
C) Line extensions
D) Industrial products
E) Straight extensions
Answer: B
AACSB:
Skill: Concept
Objective: 8-1
10) ________ are less frequently purchased consumer products and services that customers compare carefully on
suitability, quality, price, and style. Consumers spend much time and effort in gathering information and
making comparisons about these products.
A) Shopping products
B) Convenience products
C) Unsought products
E) Line extensions
Answer: A
AACSB:
Skill: Concept
Objective: 8-1
11) ________ are consumer products and services with unique characteristics or brand identification for which a
significant group of buyers is willing to make a special purchase effort.
A) Shopping products
B) Unsought products
C) Specialty products
E) Line extensions
Answer: C
AACSB:
Skill: Concept
Objective: 8-1
3
12) ________ are consumer products that the consumer either does not know about or knows about but does not
normally think about buying. These products require a lot of advertising, personal selling, and other marketing
efforts.
A) Specialty products
B) Line extensions
C) Unsought products
D) Shopping products
E) Staples
Answer: C
AACSB:
Skill: Concept
Objective: 8-1
13) ________ are those products purchased for further processing or for use in conducting a business.
A) Unsought products
B) Specialty products
C) Shopping products
E) Accessories
Answer: D
AACSB:
Skill: Concept
Objective: 8-1
14) Most manufactured materials and parts are sold directly to ________. Price and service are the major marketing
factors; branding and advertising tend to be less important.
A) consumers
B) industrial users
C) brand extensions
D) co-branders
E) wholesalers
Answer: B
AACSB:
Skill: Concept
Objective: 8-1
15) ________ are industrial products that aid in the buyerʹs production or operations, including installations and
accessory equipment.
A) Materials
B) Parts
C) Capital items
D) Specialty items
E) Supplies
Answer: C
AACSB:
Skill: Concept
Objective: 8-1
4
16) ________ consists of activities undertaken to create, maintain, or change the attitudes and behavior of target
consumers toward an organization.
A) Person marketing
B) Organization marketing
C) Internal marketing
D) Service variability
E) Intelligence marketing
Answer: B
Skill: Concept
Objective: 8-1
17) ________ marketing consists of activities undertaken to create, maintain, or change attitudes toward particular
people.
A) Corporate image
B) Person
C) Social
D) Organization
E) Intermarket
Answer: B
Skill: Concept
Objective: 8-1
18) ________ marketing involves activities undertaken to create, maintain, or change attitudes toward particular
cities, states, and regions.
A) Idea
B) Place
C) Organization
D) Social
E) Interactive
Answer: B
Skill: Concept
Objective: 8-1
19) ________ marketing is defined as the use of commercial marketing concepts and tools in programs designed to
influence individualsʹ behavior to improve their well being and that of society.
A) Unsought product
B) Internal
C) Social
D) Product line
E) Interactive
Answer: C
AACSB: Ethical Reasoning
Skill: Concept
Objective: 8-1
5
20) Public health campaigns to reduce car accidents, smoking, and obesity are all examples of ________.
A) specialty products
B) social marketing
C) shopping products
D) consumer products
E) responsibility marketing
Answer: B
Skill: Concept
Objective: 8-1
21) Developing a product or service involves defining the benefits that it will offer. These benefits are
communicated and delivered by ________ such as quality, features, and style and design.
A) private brands
B) product attributes
C) consumer products
D) product mixes
E) marketing tools
Answer: B
Skill: Concept
Objective: 8-2
22) ________ is one of the marketerʹs major positioning tools because it has a direct impact on product or service
performance; it is therefore closely linked to customer value and satisfaction.
A) Packaging
B) Product quality
C) Total quality management
D) Specialty product marketing
E) Positioning
Answer: B
Skill: Concept
Objective: 8-2
23) ________ is an approach in which all the companyʹs people are involved in constantly improving the products,
services, and business processes.
A) Product quality
B) Brand equity
C) Total quality management
D) Specialty product marketing
E) Positioning
Answer: C
AACSB:
Skill: Concept
Objective: 8-2
6
24) What are the two dimensions of product quality?
A) consistency and level
B) performance and resistance
C) design and innovation
D) conformance and style
E) feature and design
Answer: A
AACSB:
Skill: Concept
Objective: 8-2
25) Which of the following types of quality refers to freedom from defects and consistency in delivering a targeted
level of performance?
A) private brand
B) product
C) total quality management
D) conformance
E) adherence
Answer: D
AACSB:
Skill: Concept
Objective: 8-2
26) A stripped-down model without any extras is the starting point; a company can create a higher -level model by

adding ________.
A) co-branding
B) features
C) product quality
D) service variability
E) markets
Answer: B
AACSB:
Skill: Concept
Objective: 8-2
27) In assessing which new features to add to a product, a company must weigh each featureʹs ________ to
customers versus its ________ to the company.
A) cost; line extension
B) cost; service
C) value; cost
D) service; line extension
E) equity; cost
Answer: C
AACSB:
Skill: Concept
Objective: 8-2
7
28) A sensational ________ may grab attention and produce pleasing aesthetics, but it does not necessarily improve
a productʹs performance.
A) design
B) style
C) experience
D) service-profit chain
E) augmented product
Answer: B
Skill: Concept
Objective: 8-2
29) ________ contributes to a productʹs usefulness as well as to its looks.
A) Style
B) Design
C) Package
D) Brand
E) Functionality
Answer: B
AACSB:
Skill: Concept
Objective: 8-2
30) A(n) ________ is a name, term, sign, symbol, design, or a combination of these, that identifies the maker or
seller of a product or service.
A) service
B) brand
C) co-branding
D) internal marketing
E) external marketing
Answer: B
Skill: Concept
Objective: 8-2
31) ________ involves designing and producing the container or wrapper for a product.
A) Packaging B) Product line C) Service D) Branding E) Labeling
Answer: A
AACSB:
Skill: Concept
Objective: 8-2
8
32) In recent years, product safety and environmental responsibility have become major ________ concerns.
A) branding B) packaging C) labeling D) service E) product line
Answer: B
Skill: Concept
Objective: 8-2
33) At the very least, the ________ identifies the product or brand. It might also describe several things about the
product and promote the brand.
A) line extension
B) social marketing
C) label
D) specialty product
E) package
Answer: C
Skill: Concept
Objective: 8-2
34) In many countries, such as the United States and countries in the European Union, ________ require sellers to
provide detailed nutritional information on food products.
A) health, safety and environment laws
B) nutritional labeling laws
C) pollution laws
D) packaging acts
E) federal trade commission acts
Answer: B
Skill: Concept
Objective: 8-2
35) ________ has been affected by the need to include unit pricing, open dating, and nutritional information.
A) Branding
B) Packaging
C) Labeling
D) Product line filling
E) Product mixing
Answer: C
Skill: Concept
Objective: 8-2
9
36) Many companies now use a combination of phone, e-mail, fax, Internet, and other technologies to provide
________.
A) labeling information
B) brand equity
C) support services
D) packaging advantages
E) product mixes
Answer: C
AACSB: Use of IT
Skill: Concept
Objective: 8-2
37) A ________ is a group of products that are closely related because they function in a similar manner, are sold to
the same customer groups, are marketed through the same type of outlets, or fall within given price ranges.
A) product line
B) line extension
C) private brand
D) convenience product
E) product bandwidth
Answer: A
Skill: Concept
Objective: 8-2
38) The major product line decision involves ________.
A) line stretching
B) moving the line upward or downward
C) product line filling
D) product line length
E) product packaging
Answer: D
Skill: Concept
Objective: 8-2
39) Music Piano Company can expand its product line in one of two common ways. Which of the following is one
of those ways?
A) internal marketing
B) line filling
C) product mix
D) social marketing
E) line mixing
Answer: B
Skill: Concept
Objective: 8-2
10
40) An alternative to product line stretching is ________, adding more items within the present range of the line.
A) product mix
B) interactive marketing
C) product line filling
D) co-branding
E) service marketing
Answer: C
Skill: Concept
Objective: 8-2
41) When a company lengthens its product line beyond its current range, it is ________.
A) product line filling
B) product line stretching
C) product mixing
D) increasing product depth
E) building brand equity
Answer: B
Skill: Concept
Objective: 8-2
42) A ________ consists of all the product lines and items that a particular seller offers for sale.
A) product mix
B) brand line
C) consumer mix
D) packaging mix
E) line extension
Answer: A
Skill: Concept
Objective: 8-2
43) Product mix ________ refers to the number of different product lines the company carries. For example, Procter
& Gamble markets 250 brands organized into many product lines.
A) length B) height C) width D) perimeter E) depth
Answer: C
Skill: Concept
Objective: 8-2
11
44) Product mix ________ refers to the number of versions offered of each product in the line. For example, Crest
toothpaste comes in 13 varieties, ranging from Crest Multicare to Crest Baking Soda formulations.
A) length B) depth C) height D) width E) perimeter
Answer: B
Skill: Concept
Objective: 8-2
45) The ________ of the product mix refers to how closely related the various product lines are in ways such as end
use, production requirements and distribution channels.
A) length B) depth C) consistency D) width E) perimeter
Answer: C
Skill: Concept
Objective: 8-2
46) A company can increase its business in four ways. Which is NOT one of these ways?
A) It can add new product lines, thus widening its product mix.
B) It can lengthen its existing product lines.
C) It can add more versions of each product and thus deepen its product mix.
D) It can discontinue some of its lines.
E) It can increase the consistency of its product mix.
Answer: D
Skill: Concept
Objective: 8-2
47) Some analysts see ________ as the major enduring asset of a company, outlasting the companyʹs specific
products and facilities.
A) brands
B) convenience products
C) specialty products
D) unsought products
E) staples
Answer: A
Skill: Concept
Objective: 8-3
12
48) A key element in a companyʹs relationship with consumers, a ________ represents consumersʹ perceptions and
feelings about a product and its performance.
A) product line
B) product experience
C) brand
D) service
E) product attribute
Answer: C
Skill: Concept
Objective: 8-3
49) Which of the following is NOT one of the four consumer perception dimensions used by ad agency Young &
Rubicam to measure brand strength?
A) brand differentiation
B) brand knowledge
C) brand valuation
D) brand esteem
E) brand relevance
Answer: C
Skill: Concept
Objective: 8-3
50) The total financial value of a brand is estimated through the process of brand ________.
A) differentiation
B) valuation
C) extensions
D) positioning
E) equity
Answer: B
Skill: Concept
Objective: 8-3
51) The fundamental asset underlying brand equity is ________, which is the value of the customer relationships
that the brand creates. A powerful brand is important, but what it really represents is a set of loyal consumers.
A) the customer mix
B) customer equity
C) line equity
E) the service encounter
Answer: B
Skill: Concept
Objective: 8-3
13
52) Which of the following is the lowest level on which marketers can position their brands in target customersʹ
minds?
A) interactive marketing
B) internal marketing
C) product attributes
D) strong beliefs and values
E) added service
Answer: C
Skill: Concept
Objective: 8-3
53) The strongest brands go beyond attributes or benefit positioning; they are positioned on ________.
A) desirable benefit
B) good packaging
C) service inseparability
D) strong beliefs and values
E) customer image
Answer: D
Skill: Concept
Objective: 8-3
54) Which of the following is NOT a desirable quality for a brand name?
A) It should suggest something about the productʹs benefits and qualities.
B) It should be easy to pronounce, recognize, and remember.
C) The brand should almost always be a long word to get attention.
D) The name should translate easily into foreign languages.
E) It should be distinctive.
Answer: C
Skill: Concept
Objective: 8-3
55) All of the following are a manufacturerʹs sponsorship options for a product EXCEPT ________.
A) a manufacturerʹs brand
B) multibrands
C) a private brand
D) a licensed brand
E) co-branding
Answer: B
AACSB:
Skill: Concept
Objective: 8-3
14
56) Line extensions occur when a company extends existing brand names to new forms, colors, sizes, ingredients,
or flavors of a(n) _________ product category.
A) manufacturerʹs
B) private
C) existing
D) licensed
E) distributor
Answer: C
AACSB:
Skill: Concept
Objective: 8-3
57) An increasing number of retailers and wholesalers have created their own ________, also called store brands.
A) unsought products
B) private brands
C) specialty products
E) shopping products
Answer: B
AACSB:
Skill: Concept
Objective: 8-3
58) For a fee, some companies ________ names or symbols previously created by other manufacturers, names of
well-known celebrities, and/or characters from popular movies and books, any of which can provide an instant
and proven brand name.
A) service B) market C) package D) brand E) license
Answer: E
Skill: Concept
Objective: 8-3
59) ________ occurs when two established brand names of different companies are used on the same product.
A) A brand extension
B) Brand equity
C) Co-branding
D) Internal marketing
E) Cannibalization
Answer: C
Skill: Concept
Objective: 8-3
15
60) In most ________ situations, one company licenses another companyʹs well -known brand to use in
combination with its own.
A) brand extension
B) brand equity
C) co-branding
E) line extension
Answer: C
AACSB:
Skill: Concept
Objective: 8-3
61) Which of the following is an advantage offered by co-branding?
A) Manufacturers do not have to invest in creating their own brand names.
B) Retailers have exclusive products that cannot be purchased from competitors.
C) A company can expand its existing brand into a category it otherwise might have difficulty entering
alone.
D) Advertising, sales, promotion, and marketing must be carefully coordinated.
E) Brand equity is stabilized.
Answer: C
AACSB:
Skill: Concept
Objective: 8-3
62) A company has four choices when it comes to developing brands. What is NOT one of those choices?
A) line extension
B) brand extension
C) multibrands
D) width and depth extension
E) new brands
Answer: D
AACSB:
Skill: Concept
Objective: 8-3
63) ________ occur(s) when a company introduces additional items in a given product category under the same
brand name, such as new flavors, forms, colors, ingredients, or package sizes.
A) Line extension
B) Product mix
C) Interactive marketing
D) Service variability
E) Service intangibility
Answer: A
AACSB:
Skill: Concept
Objective: 8-3
16
64) A ________ involves the use of a successful brand name to launch new or modified products in a new category.
A) line extension
B) product line
C) brand extension
D) private brand
E) brand symbol
Answer: C
AACSB:
Skill: Concept
Objective: 8-3
65) Which of the following is a potential drawback of multibranding?
A) Consumers may become confused about the image of the main brand.
B) An overextended brand name might lose its specific meaning for consumers.
C) Different product features can appeal to consumers with different buying motives.
D) The companyʹs resources may be spread over too many brands.
E) The company can occupy more retail shelf space.
Answer: D
AACSB:
Skill: Concept
Objective: 8-3
66) Which strategy involves weeding out weaker brands and focusing marketing dollars only on brands that can
achieve the number-one or number-two market share positions in their categories?
A) megabrand
B) service inseparability
C) social marketing
D) unsought product
E) undifferentiated
Answer: A
AACSB:
Skill: Concept
Objective: 8-3
67) Major brand marketers often spend huge amounts on advertising to create brand ________ and to build
preference and loyalty.
A) extension
B) awareness
C) packaging
E) preference
Answer: B
Skill: Concept
Objective: 8-3
17
68) While advertising campaigns can help to create name recognition, brand knowledge, and maybe even some
brand preference, brands are not maintained by advertising but by ________.
A) marketing experience
B) line extensions
C) brand experience
D) product mix
E) word-of-mouth elements
Answer: C
Skill: Concept
Objective: 8-3
69) Service ________ means that services cannot be seen, tasted, felt, heard, or smelled before they are bought.
A) inseparability
B) variability
C) intangibility
D) perishability
E) heterogeneity
Answer: C
AACSB:
Skill: Concept
Objective: 8-4
70) Service ________ means that services cannot be separated from their providers, whether the providers are
people or machines.
A) intangibility
B) inseparability
C) variability
D) perishability
E) heterogeneity
Answer: B
AACSB:
Skill: Concept
Objective: 8-4
71) Which of the following is NOT one of the links in the service-profit chain, linking service firm profits with
employee and customer satisfaction?
A) internal service quality
B) evidence management
C) satisfied and productive service employees
D) satisfied and loyal customers
E) healthy service profits and growth
Answer: B
AACSB:
Skill: Concept
Objective: 8-4
18
72) Through ________, the service firm trains and motivates its customer -contact employees and supporting
service people to work as a team to provide customer satisfaction.
A) service inseparability
B) service intangibility
C) service variability
Answer: D
AACSB:
Skill: Concept
Objective: 8-4
73) Because service quality depends on the quality of buyer-seller interaction during the service encounter, service
marketers use ________ to train employees in the art of interacting with customers to satisfy their needs.
A) interactive marketing
B) service differentiation
C) service productivity
Answer: A
AACSB:
Skill: Concept
Objective: 8-4
74) All of the following are methods for developing a differentiated service offer, delivery, or image EXCEPT
________.
A) offering innovative features
B) increasing the quantity of service by giving up some quality
C) having more reliable customer-contact people
D) developing symbols and branding
E) designing a superior delivery process
Answer: B
AACSB:
Skill: Concept
Objective: 8-4
75) When the Twin Six Cafe provides gourmet menu options to its customers, as well as impeccable service (which
even allows customers to hand-select their own cuts of meat), ________ is(are) are evident.
A) only an actual product
B) only an augmented product
C) only a core benefit
D) both a core benefit and an actual product
E) a core benefit, an actual product, and an augmented product
Answer: E
AACSB: Reflective Thinking
Skill: Application
Objective: 8-1
19
76) A rocking chair, handmade by a woodcarver from locally grown wood is an example of a(n) ________.
A) convenience product
B) shopping product
C) specialty product
D) service
E) augmented product
Answer: C
Skill: Application
Objective: 8-1
77) You have an upset stomach. Your spouse rushes to the corner store for a bottle of medicine. This product is a(n)
________ product.
A) convenience B) unsought C) specialty D) shopping E) augmented
Answer: A
Skill: Application
Objective: 8-1
78) Dalia Saleh is planning to buy a new washing machine. She notices that they come in numerous price ranges.
She wants to make sure she gets the most for her money. This product is a(n) ________ product.
A) convenience B) unsought C) specialty D) shopping E) augmented
Answer: D
Skill: Application
Objective: 8-1
79) Which of the following does NOT belong to the materials and parts group of industrial products?
A) farm products such as wheat
B) natural products such as iron ore
C) repair and maintenance items
D) petroleum
E) lumber
Answer: C
Skill: Application
Objective: 8-1
80) Which of the following capital items is NOT considered accessory equipment?
A) buildings B) hand tools C) lift trucks D) desks E) chairs
Answer: A
Skill: Application
Objective: 8-1
20
81) Paper, pencils, lubricants, paint, nails, and brooms are examples of ________.
A) supplies
B) capital items
C) raw materials
D) specialty products
E) installations
Answer: A
Skill: Application
Objective: 8-1
82) Al Rostamani Group’s campaign stating, ‘50 Years of Excellence’ is an example of ________.
A) personal marketing
B) corporate image marketing
C) product quality
D) product line
E) social marketing
Answer: B
Skill: Application
Objective: 8-1
83) ʺJeddah Ghairʺ meaning ʹJeddah is differentʹ is an example of ________.
A) corporate image advertising
B) person marketing
C) organization marketing
D) social advertising
E) place marketing
Answer: E
Skill: Application
Objective: 8-1
84) Marketing campaigns, including classics such as “Business Friendly Bahrain,” “Malaysia Truly Asia” and
“Keep Discovering Dubai” are classified as _________ marketing.
A) social B) brand equity C) service D) product line E) place
Answer: E
Skill: Application
Objective: 8-1
21
85) To achieve their social change objectives, social marketing programs ________.
A) utilize only the promotional P of the marketing mix
B) utilize only the promotional and product Ps of the marketing mix
C) work to influence individualsʹ behavior to improve their well-being
D) utilize all of the Ps in the marketing mix
E) C and D
Answer: E
AACSB: Analytic Skills
Skill: Application
Objective: 8-1
86) Which question is the most important for product designers to consider as they develop a product?
A) Which product features can be added to create higher-level models?
B) How does the product appear?
C) What are the productʹs technical specifications?
D) How will customers use and benefit from the product?
E) How is the product packaged to attract spontaneous purchases?
Answer: D
Skill: Application
Objective: 8-2
87) Rasha Gendy began to market shampoo for normal hair. In an attempt to increase profits and use excess
market capacity, Rasha then marketed shampoo for oily hair and color-treated hair. This is an example of
________.
A) line filling
B) social marketing
C) a shopping product
D) an unsought product
E) people marketing
Answer: A
Skill: Application
Objective: 8-2
88) Which of the following is/are examples of product mix depth?
A) hamburger and cheeseburger
B) hamburger and fries
C) Coke and Diet Coke
D) A and C
E) all of the above
Answer: D
Skill: Application
Objective: 8-2
22
89) Chicken of the Sea brand tuna sells more than the same size Kroger brand tuna, even though the Kroger tuna
costs $0.15 less per can. Chicken of the Sea has brand ________.
A) extension B) equity C) specialty D) service E) valuation
Answer: B
Skill: Application
Objective: 8-3
90) A manager of a Holiday Inn said, ʺWe have power and value in the market and people are willing to pay for
it.ʺ This manager is referring to ________.
A) social marketing
B) specialty products
C) brand equity
D) line filling
E) product length
Answer: C
Skill: Application
Objective: 8-3
91) Spinneyʹs Rice products are an example of a(n) ________.
A) organizational brand
B) support brand
C) private brand
D) sponsorship brand
E) manufacturerʹs brand
Answer: C
Skill: Application
Objective: 8-3
92) An apparel marketer is planning to launch an existing brand name into a new product category. Which brand
development strategy is being implemented?
A) line extension
B) brand extension
C) multibranding
D) new brands
E) rebranding
Answer: B
Skill: Application
Objective: 8-3
23
93) Each new iPod product introduction advances the causes of democratizing technology and approachable
innovation. iPod, an expert at fostering customer community, has been ranked one of the Breakaway Brands by
the brand consultancy Landor Associates. iPod is positioned on ________.
A) attributes
B) benefits
C) variation
D) selection
E) beliefs and values
Answer: E
Skill: Application
Objective: 8-3
94) Manor Plaza Barberʹs customers have noticed that the quality of a haircut depends on who provides it as well
as when, where, and how it is provided. What have the customers noticed?
A) service intangibility
D) service perishability
E) service distinction
Answer: C
Skill: Application
Objective: 8-4
95) The impossibility of a barber storing haircuts for later sale is an example of which of the following?
A) service intangibility
D) service perishability
E) low-context services
Answer: D
Skill: Application
Objective: 8-4
24
96) Ginaʹs Nail Salon is serious about pleasing its customers. Employees are trained to immediately and pleasantly
respond to any customer complaints, and they are empowered to offer discounts and free add -ons to
customers who believe they have received anything less than the best service. Ginaʹs Nail Salon focuses on
________.
A) differentiating its offer
B) good service recovery
C) internal marketing
D) image marketing
E) productivity
Answer: B
Skill: Application
Objective: 8-4
Refer to the scenario below to answer the following questions.
Sadiq Abbas built his enterprise on the faithful patronage of four specialty shops and a large contract from Altaf
Distribution. But after two years, the maker of novelty pens and pencils had to rethink his strategy when his two -year
contract with Altaf ended.
Sadiq built a company reputation on the manufacture and distribution of a variety of wooden writing utensils with
customized engravings. Specialty shops loved to display the products in their fancy, lighted showcases, but such specialty
shops alone were not profitable. Sadiq Abbas established a brand name, known merely as Abbas, and decided to expand on
it.
Sadiq extended his writing utensil lines to include quills, felt-tip pens, and multiple-cartridge pens that write in
different colors. He even added a line of various grades of personalized stationery and business cards. Perhaps Sadiqʹs
biggest added touch, however, was the addition of two salespeople who would work to explain the diverse array of
products offered by Abbas, as well as nurture existing accounts.
ʺWe make an excellent product,ʺ Sadiq Abbas stated, ʺand we honor a good guarantee on everything we sell. But letʹs
face it  we face hundreds of competitors! We need Abbas representatives out there to help prospects understand what they
should demand in something as simple as a writing tool.ʺ
The Abbas brand was fast-becoming synonymous with top-notch customer service. Part of the purchase package
brought personal visits from the Abbas representative, before the purchase and long after.
97) An easier, more comfortable, more stylish transfer of thought onto paper is the ________ of Sadiqʹs offerings.
A) tangible good
B) core customer value
C) actual product
D) augmented product
E) pure service
Answer: B
Skill: Application
Objective: 8-1
25
98) What type of consumer products does Abbas manufacture?
A) industrial B) convenience C) specialty D) shopping E) unsought
Answer: C
Skill: Application
Objective: 8-1
99) The new felt-tip pens, multiple-cartridge pens, and quills are all examples of ________.
A) product line filling
B) multibranding
C) megabranding
D) product line inconsistencies
E) licensed brands
Answer: A
Skill: Application
Objective: 8-2
TRUE/FALSE. Write ʹTʹ if the statement is true and ʹFʹ if the statement is false.
100) A service is anything that can be offered to a market for attention, acquisition, use, or consumption, and that
might satisfy a want or need.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-1
101) Sony offers consumers more than just camcorders; it provides consumers with a complete solution to their
picture-taking problems. This offering is called an augmented product.
Answer: True False
Skill: Application
Objective: 8-1
102) Unsought products are products that the customer usually buys frequently, immediately, and with a minimum
of comparison and buying effort.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-1
26
103) Shopping products are less frequently purchased consumer products and services that customers compare
carefully on suitability, quality, price, and style.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-1
104) Style is a larger concept than design. Design describes the appearance of a product.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-2
105) Branding can add consumer value to a product.
Answer: True False
Skill: Concept
Objective: 8-2
106) Because so many purchase decisions are made in stores, a productʹs packaging may be a sellerʹs last and best
chance to influence consumers.
Answer: True False
Skill: Concept
Objective: 8-2
107) Product support services identify the product or brand, describe several things about the product, and promote
the product through attractive graphics.
Answer: True False
Skill: Concept
Objective: 8-2
108) Quaker produces a variety of cereals. This variety is called its product line.
Answer: True False
Skill: Application
Objective: 8-2
109) Cannibalization and customer confusion about product differentiation are two potential results if line filling is
overdone.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-2
27
110) A company can stretch its product either upward or downward, but not in both directions.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-2
111) A company might stretch its product line upward to add prestige to its current products.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-2
112) A companyʹs product mix has four important dimensions: width, length, depth, and consistency.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-2
113) Dove marketers can go beyond the brandʹs cleansing cream properties and talk about the resulting benefit of
softer skin. This is known as product attributes in brand positioning.
Answer: True False
Skill: Application
Objective: 8-3
114) Attributes are the least desirable level for brand positioning because competitors can easily copy attributes and
customers are more interested in what attributes will do for them than in the attributes themselves.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-3
115) Retailers and wholesalers who have created their own brands are participating in co -branding.

Answer: True False
Skill: Application
Objective: 8-3
116) When a company introduces a new brand name in the same product category, it is called line extension.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-3
28
117) Customers come to know a brand through a wide range of contacts and touch points, including word of
mouth, personal interactions with company people, telephone interactions, and company websites.
Answer: True False
Skill: Concept
Objective: 8-3
118) As an example of service variability, within a given hotel one registration-desk employee may be cheerful and
efficient, whereas another may be unpleasant and slow.
Answer: True False
Skill: Application
Objective: 8-4
119) Service inseparability means that the quality of services depends on who provides them, as well as when,
where, and how they are provided.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-4
120) In a service business, the customer and front-line service employee interact to create the service.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-4
121) The service-profit chain is the set of all product lines and items that a particular seller offers for sale.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-4
122) One aspect of managing service differentiation is the companyʹs service delivery.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-4
123) Customer retention is perhaps the best measure of quality  a service firmʹs ability to hang on to its customers

depends on how consistently it delivers value to them.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-4
29
124) Good service recovery can turn angry customers into loyal customers and can even win more customer
purchasing and loyalty than if no problem had occurred in the first place.
Answer: True False
AACSB:
Skill: Concept
Objective: 8-4
SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.
125) Give an example of the most basic level of product, the core benefit.
Answer: Examples are numerous. A salon owner, providing similar services to a day spa, may focus on
ʺpampering yourself in total relaxation.ʺ
Skill: Application
Objective: 8-1
126) Give examples of the second level of product, the actual product.
Answer: A salon owner may market hair- and nail-care products and services, full- and partial-body massages,
workout equipment and training, and social activities, and so forth.
Skill: Application
Objective: 8-1
127) Give an example of an augmented product.
Answer: Examples will vary. An augmented product may include the customer of a salon having the option of
having most of the services performed in the privacy and solitude of his or her home.
Skill: Application
Objective: 8-1
128) Give three examples of convenience products.
Answer: Examples may include soft drinks, milk, and candy.
Skill: Application
Objective: 8-1
129) Give three examples of shopping products.
Answer: Examples may include furniture, clothing, cars, major appliances, and hotel and airline services.
Skill: Application
Objective: 8-1
30
130) Give three examples of specialty products.
Answer: Examples are many, but might include specific brands of cars, high -priced photographic equipment,
designer clothes, and the services of medical or legal specialists.
Skill: Application
Objective: 8-1
131) What do industrial supplies and consumer convenience products have in common? How do they differ?
Answer: Industrial supplies are purchased for further use in conducting a business, while convenience products
are purchased by final consumers for personal consumption; both types of products are usually
purchased with a minimum of effort or comparison.
Skill: Application
Objective: 8-1
132) How does a brand name add value to a product?
Answer: Quality and consistency can be identified through a brand; experience with or knowledge of anotherʹs
experience with a brand helps a buyer to know what features, benefits, and quality can be expected from
a product.
Skill: Application
Objective: 8-2
133) How might a flower shop engage in line stretching?
Answer: A flower shop may offer single-stem, fresh-cut flowers, sold individually; small arrangements;
bouquets; or large ceremonial sprays. With line stretching, the flower shop will offer a wide array of
products geared toward all types of flower buyers.
Skill: Application
Objective: 8-2
134) Why might a company pursue a strategy of less product line consistency?
Answer: A company might want to increase its business by building a reputation in several product fields.
Diff: 2 Page Ref: 213-214
Skill: Application
Objective: 8-2
135) Consumers form relationships with products via brands. What might happen that allows a consumer to move
from merely recognizing a brand to preferring a brand?
Answer: A consumer has likely tried the brand at least once in order to prefer it over others; or, perhaps the
consumer prefers a brand merely because he or she has been exposed to a catchy ad or promotional
gimmick.
Skill: Application
Objective: 8-3
31
136) Why is it important for a brand promise to be simple and honest?
Answer: Consumers who purchase the product and believe it does not live up to the promise will develop a
negative image of the brand; they will be less likely to become loyal customers.
Skill: Application
Objective: 8-3
ESSAY. Write your answer in the space provided or on a separate sheet of paper.
137) What are the desirable qualities in a brand name?
Answer: Desirable qualities for a brand name include the following: (1) it should suggest something about the
product’’s benefits and qualities; (2) it should be easy to pronounce, recognize, and remember; (3) it
should be distinctive; (4) it should be extendable; (5) it should translate easily into foreign languages; (6)
it should be capable of registration and legal protection.
Skill: Application
Objective: 8-3
SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.
138) How might measuring service quality be more difficult than measuring product quality?
Answer: Products are tangible; therefore, measuring quality across several dimensions  such as durability,
functionality, and so on  may be easier or performed more consistently than when measuring service
quality.
Skill: Application
Objective: 8-4
139) As a service provider, why might you perceive the buyer-seller relationship in the service encounter to be
especially critical?
Answer: Customersʹ perceptions are established during the service encounter. At this time, based on these
perceptions, customers can become loyal, long-term buyers. It is critical that service sellers establish
sound relationships from the beginning.
Skill: Application
Objective: 8-4
32
ESSAY. Write your answer in the space provided or on a separate sheet of paper.
140) Products and services fall into two broad classes based on the types of consumers that use them. Name these
two broad classes and describe how they are different from each other.
Answer: The two broad classes are consumer products and industrial products. Consumer products and services
those bought by final consumersare usually classified according to consumer shopping habits. They
include convenience products, shopping products, specialty products, and unsought products.
Industrial products are distinguished from consumer products by the purpose for which they were
purchased: they are those that are purchased for further processing or for use in conducting a business.
They include the three broad categories of materials and parts, capital items, and supplies and services.
Skill: Application
Objective: 8-1
141) Name and describe three decisions that companies make regarding their individual products and services.
Answer: Decisions to be made in the development and marketing of individual products and services include 1)
product attributes, 2) branding, 3) packaging, 4) labeling, and 5) product support services. Product
attribute decisions involve product quality, features, and style and design. Branding decisions include
selecting a brand name and developing a brand strategy. Packaging involves designing and producing a
productʹs container; packaging provides many key benefits, such as protection, economy, convenience,
and promotion. Labeling identifies the product and may describe and promote the product and brand.
Companies must also make a decision about product support services, which are usually a minor or
major part of a market offering.
Skill: Application
Objective: 8-2
142) Describe the role of packaging.
Answer: Packaging involves designing and producing the container or wrapper for a product. Packaging contains
and protects the product, but it is also used to attract customer attention, to describe the product, and to
make the sale. Innovative packaging may give a company an edge over competitors.
Skill: Application
Objective: 8-2
143) Using the product mix dimensions, which provide the handles for defining a company’s product strategy,
explain how a company can increase its business in four ways.
Answer: 1. It can add new product lines, widening its product mix. In this way, new lines are built on the
companyʹs reputation from its other lines.
2. The company can lengthen its existing product lines to become a more full-line company.
3. It can add more versions of each product and thus deepen its product mix.
4. The company can pursue either more or less product line consistency, depending on whether it wants
to have a strong reputation in a single field or in several fields.
Skill: Application
Objective: 8-2
33
144) Compare product mix width, length, consistency, and depth.
Answer: Product mix width refers to the number of different product lines the company carries; product length
refers to the total number of products carried in a companyʹs product lines. Consistency refers to how
closely related the various product lines are in end use. Product depth refers to the number of versions of
each product offered in the line.
Skill: Application
Objective: 8-2
145) A manufacturer has four brand sponsorship options. Describe what they are.
Answer: A manufacturer can launch its own brand (manufacturerʹs brand or national brand). It can sell to
resellers who give the product a private brand (or store brand). It can market licensed brands, using
names or symbols created by other manufacturers, names of celebrities, or characters from popular
movies or television. Finally, a manufacturer can join forces with another company to co-brand a
product.
Skill: Application
Objective: 8-3
146) A company has four choices when it comes to developing brands. Describe what they are.
Answer: The company can introduce line extensions, brand extensions, multibrands, or entirely new brands. A
line extension involves extending a current brand name to new forms, colors, sizes, flavors, etc. in one of
the companyʹs existing product categories. In contrast, a brand extension extends a current brand name
to a new or modified product in a new product category. Multibranding involves introducing several
brands within the same category. Finally a company may decide that a new brand name is needed,
particularly if the power of an existing brand name is declining or the company is entering a new
product category.
Skill: Application
Objective: 8-3
147) Services are characterized by four key characteristics. Name and describe these four characteristics.
Answer: The four service characteristics are intangibility, inseparability, variability, and perishability. Services are
intangible: they cannot be seen, tasted, felt, heard, or smelled before they are bought. Services are
inseparable: they are produced and consumed at the same time and cannot be separated from their
providers, whether the providers are people or machines. Services are variable: their quality may vary
greatly, depending on who provides them and when, where, and how they are provided. Services are
perishable: they cannot be stored for later sale or use.
Skill: Application
Objective: 8-4
34
148) Good service companies focus attention on both customers and employees. Describe what the service -profit
chain and internal marketing are, and how they differ from each other.
Answer: The service-profit chain links service firm profits with employee and customer satisfaction. The links in
the service-profit chain are as follows: internal service quality leads to satisfied and productive
employees, who create greater service value, which leads to satisfied and loyal customers, who create
healthy service profits and growth. Internal marketing by a service firm refers to training and effectively
motivating its customer-contact employees and all the supporting service people to work as a team to
provide customer satisfaction. The service-profit chain deals with employees and customers. Internal
marketing deals with training employees.
Skill: Application
Objective: 8-4
149) How can service providers use a differentiated offer, delivery, and image to avoid competing solely on price?
Answer: A service offer can include innovative features that differentiate the companyʹs offers from competitors.
Service delivery can be differentiated by hiring and training more reliable customer -contact people,
developing a superior physical environment in which the service is delivered, and designing a superior
delivery process. Services can also be differentiated through symbols and branding, creating an image
that sets a companyʹs services apart from competitorsʹ.
Skill: Application
Objective: 8-4
35

Chapter 08. Products, Services, and Brands: Building Customer Value

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26) A stripped-down model without any extras is the starting point; a company can create a higher -level model by

115) Retailers and wholesalers who have created their own brands are participating in co -branding.

123) Customer retention is perhaps the best measure of quality  a service firmʹs ability to hang on to its customers

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