Marketing Management (D174)

Correct Answer D: Service is the basis of exchange, Value is for multiple parties, Value is defined by the customer.

Explanation

The Service-Dominant Logic (SDL) framework suggests that service is the foundation of all economic exchanges. The first axiom states that service is the basis of exchange, meaning that even when physical goods are involved, the true value comes from the service they provide. For example, a smartphone is valuable because it enables communication and productivity. The second axiom states that value is for multiple parties, emphasizing that businesses, customers, and stakeholders all contribute to and benefit from the value creation process. The third axiom states that value is defined by the customer, meaning that businesses do not determine a product's worth—its true value depends on how customers perceive and experience it.

Why other options are wrong

A. Service is the customer's choice, Value is for the company, Value is defined by the market.

Service is not just a choice but the foundation of economic exchanges. Value is not solely for the company but must be shared among various stakeholders. Additionally, value is determined by the customer rather than the market as a whole.

B. Service is the core offering, Value is for the competition, Value is defined by the company.

While service is central, value is not primarily for competition but for customers and multiple stakeholders. Value is also not defined by the company; instead, it is shaped by the customer’s experience and perception.

C. Service is the primary product, Value is for the company, Value is defined by the competition.

Service is more than just a product—it is the basis of all transactions. Value is not limited to benefiting the company, as multiple parties are involved in value creation. Furthermore, competition does not define value; customers do.

Correct Answer B: Influencers can show how the product helps them stay creative and productive while using their phones.

Explanation

A key advantage of influencer marketing is its ability to showcase real-life applications of a product in an engaging and relatable manner. Influencers can demonstrate how The Virtual Communicator enhances creativity and productivity, making it easier for their followers to see its value. Through personal storytelling and demonstrations, influencers create an emotional connection with their audience, leading to higher engagement and potential conversions.

Why other options are wrong

A. Influencers can provide detailed technical specifications of the product. While influencers may touch on product specifications, their primary strength lies in creating engaging content that highlights usability and benefits. Technical details are typically better suited for product websites or official documentation rather than influencer promotions, which focus on experience and relatability.

C. Influencers can reach a global audience easily. While influencers can have international followers, their impact is strongest within their specific niche or target market. The effectiveness of influencer marketing depends on audience engagement rather than just global reach. A highly engaged niche audience is often more valuable than a large but less interactive global audience.

D. Influencers can offer discounts to their followers. Although some influencers provide discount codes, this is a sales tactic rather than the main benefit of influencer marketing. The core strength of influencer marketing is authentic product endorsement, not just offering discounts. A well-executed campaign focuses on the influencer's experience with the product, encouraging organic interest rather than solely relying on price reductions.

Correct Answer A: Paid Media: Ad space that you have to pay for. Owned Media: Marketing channels that a company has complete control over. Earned Media: When a customer or entity markets for no cost.

Explanation

Media in marketing is classified into three types:

Paid Media – Any form of marketing that requires payment, such as online ads, TV commercials, and influencer sponsorships.

Owned Media – Marketing channels that a business fully controls, such as its website, social media pages, or email lists.

Earned Media – Free publicity or brand exposure gained through word-of-mouth, customer reviews, or media coverage.

Why other options are wrong

B. Paid Media: Ad space that is rented. Owned Media: Marketing channels that are free. Earned Media: When a customer or entity markets for a fee. – Owned media is not necessarily free; companies invest in maintaining websites and social media. Earned media does not involve a fee.

C. Paid Media: Ad space that is shared. Owned Media: Marketing channels that are rented. Earned Media: When a customer or entity markets for a cost. – Paid media is not "shared"; it is purchased. Owned media is not rented, as companies fully control it. Earned media is not something customers pay for.

D. Paid Media: Ad space that is free. Owned Media: Marketing channels that require payment. Earned Media: When a customer pays for marketing. – Paid media is never free, and earned media does not involve customer payments.

Correct Answer A: Intangibility, Inseparability, Variability, Perishability

Explanation

Services have unique characteristics that differentiate them from physical goods:

Intangibility – Services cannot be touched or stored like physical products.

Inseparability – Services are produced and consumed simultaneously (e.g., a haircut cannot be separated from the barber providing it).

Variability – Service quality can vary based on the provider, time, and conditions.

Perishability – Services cannot be stored or inventoried (e.g., an empty hotel room loses revenue for that night).

Why other options are wrong

B. Durability, Tangibility, Quality, Quantity – These are attributes of physical goods, not services. Services are intangible and cannot be measured in terms of durability.

C. Price, Promotion, Place, Product – These are elements of the marketing mix, not characteristics of services.

D. Size, Shape, Color, Features – These apply to tangible products and do not describe the unique nature of services.

Correct Answer C: Reliability

Explanation

Reliability in service quality refers to a company's ability to provide consistent and dependable services. A leading mobile phone company ensures network coverage, uninterrupted service, and dependable performance, making reliability a key factor in its service quality.

Why other options are wrong

A. Empathy. – Empathy refers to personalized customer service and understanding individual needs, which is more relevant to customer support than network performance.

B. Assurance. – Assurance relates to the confidence and trust customers have in the company, often linked to knowledgeable staff and strong warranties, but not directly to service reliability.

D. Tangibility. – Tangibility refers to physical aspects such as facilities, equipment, and appearance, which are not the primary factor in mobile network services.

Correct Answer

B. Harvesting

Explanation

Harvesting is a strategy used during the decline stage of a product's lifecycle. It involves keeping the product in the market while gradually reducing marketing and operational costs. This approach helps a company maximize remaining profitability before eventually discontinuing the product.

Why other options are wrong

A. Deletion. This strategy involves completely removing the product from the market rather than keeping it with reduced costs.

C. Contracting. This is not a commonly recognized strategy in product decline management.

D. Shaping. This term does not apply to managing declining products.

Correct Answer

B. Job sharing

Explanation

Job sharing is a work arrangement where two part-time employees share the duties of one full-time position. This allows both employees to balance work and personal life while ensuring the job is covered without overburdening any single person. It’s an arrangement often used by organizations to provide flexibility while maintaining productivity.

Why other options are wrong

A. Job rotation. Job rotation involves employees moving between different jobs or roles in the organization to gain experience, not to share one role.

C. Telecommuting. Telecommuting refers to working from a remote location, usually from home, and doesn’t involve sharing responsibilities.

D. Freelancing. Freelancers are self-employed individuals who work on a contract basis, not typically sharing a job with another employee.

Correct Answer

B. Coke and Pepsi

Explanation

Substitutes are products that serve a similar function and can be used interchangeably. Coke and Pepsi are direct competitors in the soft drink market, meaning that consumers can easily switch between them based on preference, price, or availability.

Why other options are wrong

A. SUVs. SUVs are a category of vehicles rather than a specific substitute for another product.

C. Ramen noodles. This is a type of food, but without a direct alternative being compared, it does not clearly demonstrate the substitute concept.

D. Hot dogs and hot dog buns. These are complementary products, meaning they are often consumed together rather than serving as alternatives to each other.

Correct Answer A: Macro marketing

Explanation

Macro marketing refers to the overall system of marketing in an economy, ensuring that goods and services are efficiently distributed from producers to consumers. It takes a broad perspective, considering how marketing impacts society, including economic development, consumer welfare, and ethical concerns.

Why other options are wrong

B. The transporting function. This only refers to logistics and the physical movement of goods, not the broader marketing system.

C. Micro marketing. This focuses on individual businesses and targeted marketing efforts rather than the economy-wide flow of goods.

D. Standardization and grading. These involve quality control and consistency in products rather than the distribution process.