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10Student: ___________________________________________________________________________

1.

The purpose of setting specific advertising goals and objectives is to:

A. provide a benchmark against which success or failure can be measured.

B. put constraints on the creative department.

C. have a method of determining when to delete products from the product line.

D. forecast the market share level that can be attained by good advertising.

2.

Meaningful objectives can also be a useful guide for:

A. creative executions.

B. customer satisfaction.

C. understanding market trends.

D. decision making.

3.

Which of the following is NOT given as a realistic reason for setting specific objectives for an integrated marketing communications program?

A. Specific objectives serve as communication devices and facilitate coordination of various groups working on the campaign.

B. Specific objectives serve as a guide for planning and decision making.

C. Specific objectives provide a benchmark against which success or failure of a campaign can be measured.

D. Specific objectives provide specific ideas on how to develop more creative and effective advertising.


4.

_____ objectives are types of objectives that are usually stated in terms of specific, measurable outcomes such as sales volume, market share or return on investment.

A. Sales

B. Marketing

C. Communication

D. Advertising

5.

Which of the following statements best describes the relationship between marketing and IMC objectives?

A. Marketing objectives and communications objectives are synonymous.

B. Marketing objectives evolve from communication objectives.

C. IMC objectives are derived from marketing objectives.

D. For a successful campaign, communications objectives can be developed before or after the development of marketing objectives.

6.

To be effective, marketing objectives need to be:

A. realistic and attainable.

B. erudite and challenging.

C. philosophical and fungible.

D. long-term and qualitative.


7.

Marketing goals defined in terms of sales, profits, or market share increases are:

A. situational response objectives.

B. usually not appropriate for marketing communication objectives.

C. integrated marketing communications objective.

D. relationship marketing objectives.

8.

To develop integrated marketing communications objectives, managers need the situation analysis to identify:

A. the marketing issues.

B. the marketing communication issues.

C. ‘Where are we now?’.

D. all of the given answers.

9.

Many marketing managers approach promotion from a(n) _____ perspective and believe the objective of advertising and other promotional mix elements is to relay information about a product to customers.

A. informational

B. communications

C. sales-orientated

D. segmentation


10.

Many marketing managers prefer sales-orientated objectives for advertising because they believe:

A. the reason a company spends money on advertising and promotion is to sell its products or service.

B. money spent on advertising and promotion should show measurable results.

C. sales-orientated objectives help get everyone involved in the promotional program to think about how advertising and promotion will influence sales.

D. all of the given answers are true.

11.

Financially orientated managers who view marketing communications as an expense rather than an investment are likely to prefer _____ objectives for advertising and other promotional areas.

A. sales-orientated

B. communication

C. positioning

D. image

12.

In addition to advertising and promotion, _____ might also influence a company's sales.

A. product quality

B. price

C. distribution

D. all of the given answers


13.

The concept of advertising expenditures producing long-term as well as immediate results is known as:

A. the carryover effect.

B. the communication effect.

C. the low-involvement effect.

D. the halo effect.

14.

The carryover effect:

A. has no impact on sales objectives.

B. has no effect on the relationship between advertising and sales.

C. encourages the use of non-specific objectives.

D. is particularly apparent with mature, low-priced and frequently purchased products.

15.

Which of the following is likely to be a problem for a manager who uses sales as a measure of advertising effectiveness?

A. Sales results offer little guidance or direction to those responsible for planning and developing the advertising program.

B. There is a short, often unmeasurable, time period between when advertising is run and when sales actually occur.

C. Sales results are affected by no marketing mix variable other than price and promotion.

D. No internal environmental variables have any significant influence on sales results.


16.

Using sales results as an advertising objective can be difficult due to:

A. the difficulty in isolating the effects of advertising on sales.

B. the fact there is often a lagged effect whereby the effect of advertising on sales is not immediate.

C. the fact advertising objectives emphasising sales are generally not good operational guides to decision making.


17.

Direct-response advertisers generally set objectives and measure success in terms of:

A. brand awareness.

B. brand attitudes.

C. purchase intentions.

D. sales response generated by an ad.

18.

Sales-orientated objectives are appropriate for:

A. all internet marketing.

B. retail advertising promoting a sale or special event.

C. products that have been introduced in a highly volatile market.

D. any advertising campaign aimed at maintaining brand awareness.


19.

Various response hierarchy variables such as awareness, knowledge, liking, preference, conviction and purchase are the basis for:

A. marketing objectives.

B. sales-orientated objectives.

C. image objectives.

D. communications objectives.

20.

Advocates of communication-based objectives for advertising propose using _____ as a basis for setting these objectives.

A. sales

B. market share

C. stages of a hierarchical response model

D. carryover effects

21.

Which of the following is at the top of the communication effects pyramid?

A. Awareness

B. Knowledge

C. Liking

D. Purchase/repurchase


22.

Managers who use the communications effects pyramid to set objectives believe:

A. lower-level objectives such as purchase and reuse form the foundation of the communications program.

B. the foundation of the communications program is set by accomplishing lower-level objectives such as awareness, knowledge and comprehension.

C. advertising and promotion should first accomplish lower-level objectives such as trial and purchase.

D. advertising and promotion should first accomplish higher-order objectives such as trial and purchase and then create awareness and brand knowledge.

23.

‘Encouraging current drinkers of Coca-Cola to drink more of the beverage’ would be an example of a _____ objective.

A. sales-orientated

B. market-orientated

C. product development

D. communications

24.

Which of the following statements about communications objectives is true?

A. When setting objectives using the communications effect pyramid, the last step reached is trial.

B. Sales goal cannot be translated into communications objectives.

C. Marketing and advertising managers do not rely on experience and intuition when setting communications goals.

D. Communications objectives are the criteria used in the DAGMAR approach to setting advertising goals.


25.

DAGMAR is:

A. a philosophy of advertising goal setting.

B. a model of consumer behaviour.

C. a method of setting sales objectives.

D. the most often used method of setting objectives.

26.

_____ is an approach to setting advertising goals and objectives, which states that communication effects are the logical basis for advertising goals and objectives against which success or failure should be measured.

A. The carryover effect

B. The hierarchy of effects model

C. Zero-based communications planning

D. DAGMAR

27.

According to DAGMAR, the basic function of advertising is to:

A. create sales.

B. communicate.

C. increase market share.

D. generate action.


28.

Under the DAGMAR model, a(n) _____ can be performed by and attributed to advertising rather than a combination of marketing factors.

A. advertising hierarchical plan

B. functional communication change

C. communications task

D. marketing task

29.

According to the criteria outlined in DAGMAR, which of the following is the best statement of a quantitative communications objective?

A. ‘Increase product users to 40% of the total market.’

B. ‘Win new customers and increase sales volume by 15%.’

C. ‘Increase the number of customers mentioning the brand name when asked for brand preference from 40% to 50%.’

D. ‘Increase awareness of the brand.’

30.

Using the DAGMAR approach, which of the following is NOT a stage of commercial communication?

A. awareness

B. comprehension

C. conviction

D. sales


31.

For which of the following advertising communication tasks should the specified time period required be the longest?

A. creating brand awareness

B. increasing brand awareness levels

C. creating knowledge regarding a brand attribute

D. repositioning a brand

32.

DAGMAR MOD II was developed to alleviate problems with:

A. the response hierarchy used in the original DAGMAR model.

B. the costs of using DAGMAR.

C. the fact DAGMAR ignores sales results.

D. setting benchmark measures.

33.

Which of the following is NOT an example of a common criticism of DAGMAR?

A. It ignores communications objectives.

B. It is difficult to implement.

C. It is a costly and time-consuming process.

D. It runs counter to the belief that the function of advertising is to create sales.


34.

The letters in the RTTT models spell out the quality of the objectives and the goals they seek to achieve. What do the letters represent?

A. Regression, Trial, Target market and Theory

B. ROI, Target market, Timing and Task

C. Realistic, Target market, Task and Timeframe

D. Regression, Timing, Term and (market) Type

35.

To more fully appreciate the value of advertising and promotion, managers should treat the communications budget as a(n):

A. asset.

B. expense.

C. liability.

D. investment.

36.

In marginal analysis, all of the following should be considered EXCEPT:

A. sales.

B. fixed costs of advertising.

C. advertising expenditures and other variable costs.

D. net worth.


37.

The _____ function model is based on the microeconomics law of diminishing returns.

A. concave-upward

B. S-shaped demand

C. S-shaped response

D. concave-downward

38.

The concave-downward function model is based on:

A. the microeconomics law of diminishing returns.

B. the economic law of supply and demand.

C. price elasticity of demand quotients.

D. the change in contribution margins as item price is changed.

39.

The S-shaped response function implies that:

A. initial advertising expenditures will have little impact on sales.

B. advertising expenditures will have major impact on sales.

C. sales effects will follow the microeconomic law of diminishing returns.

D. sales will immediately increase then decrease.


40.

The two models that are commonly used to explain the relationship between advertising and sales are the:

A. concave-downward function and the S-shaped response function.

B. S-shaped response function and the concave-upward function.

C. marginal utility function and the S-shaped demand function.

D. S-shaped demand function and the convex-downward function.

41.

Well-known brand name products do not receive incremental advantages from increased dollar expenditures on advertising. Once the ad hits the market, subsequent budget increases result in little or no incremental gains. This might best be explained by:

A. arbitrary allocation.

B. the objective and task method.

C. competitive parity.

D. rapidly diminishing returns.

42.

According to the concave-downward model:

A. the effects of advertising quickly begin to diminish.

B. the carryover effect is especially true for low-priced, frequently purchased consumer products.

C. sales decrease rapidly if the price is too high.

D. initial outlays of the advertising budget have little impact on sales.


43.

According to the S-shaped response curve:





44.

A marketing firm decides to purchase media time in an attempt to sell its new product. After purchasing approximately $1 million dollars of time, it has noticed no impact on the sales of the product. However, at $3 million, a substantial increase is shown. This might best be explained by:




D. an S-shaped response.

45.

The S-shaped response curve suggests:

A. advertising effectiveness will not be related to spending.

B. very low spending levels will not work.

C. advertising effectiveness will vary directly according to spending levels.

D. the carryover effect is especially true for low-priced, frequently purchased consumer products.


46.

Which of the following is a factor that influences the setting of the advertising budget?

A. which stage of its life cycle the product is in

B. whether competition is active or concentrated

C. whether the marketer is a pioneer in the market

D. All of the given answers

47.


A. whether the company uses communications or sales objectives

B. corporate structure

C. the basis for product differentiation

D. the extent of selective retention

48.

When higher-level executives determine the budget amounts to be allocated for each department's advertising expenditures, a _____ approach is being used:

A. bottom-up

B. marginal contribution

C. top-down

D. Delphi


49.

All of the following are considered top-down approaches to determining budgets EXCEPT:

A. the objective and task method.

B. the affordable method.

C. the percentage of sales method.

D. arbitrary allocation.

50.

Which of the following is NOT a top-down approach to budget setting?

A. the affordable method

B. percentage of sales

C. competitive parity

D. payout planning

51.

The _____ method of budgeting is being employed when expenditures are allocated by an analysis of expenditures for all aspects of producing and marketing the product. The ad budget is determined by making sure a certain amount is not exceeded.

A. arbitrary allocation


C. affordable

D. return on investment


52.

You know the _____ method of budgeting is being employed after hearing an experienced marketing department manager respond to a new employee's question, ‘How was the ad budget established last year?’ by saying, ‘The same way it's always been done. I just have an instinct for how much should be budgeted where.’



C. ROID. return on

investment 53.

Which top-down budgeting method is being employed when expenditures are allocated by assigning a budget based on gut feelings?



C. affordable method

D. payout planning

54.

The most commonly utilised method of budget determination by large firms is:

A. competitive parity.

B. objective and task.

C. percentage of sales.



55.

The _____ method of budgeting is being employed when expenditures are allocated by assigning a part of the cost of the product to be allocated to advertising. The total budget is based on units sold.



C. objective and task


56.

To set an advertising budget, the marketer of filing cabinets examines advertising-to-sales ratios published in trade magazines and then allocates a percentage of sales dollars to the advertising effort. Which two budgeting methods are being employed?

A. competitive parity and percentage of sales

B. competitive parity and payout planning

C. payout planning and percentage of sales

D. percentage of sales and objective and task

57.

Which of the following budgeting procedures would be used if a firm wanted a method that is simple to understand and financially safe?

A. competitive parity

B. marginal analysis

C. percentage of sales

D. objective and task


58.

The _____ method of budgeting uses advertising-to-sales ratio data.

A. objective and task

B. affordable


D. ROI 59.

The major problem associated with the _____ budgeting method is a reversal of the cause and effect relationship.

A. percentage of sales

B. objective and task


D. S-shaped response

60.

The _____ budgetary allocation method is designed to promote stability and minimise marketing warfare as well as taking advantage of the collective wisdom of the industry.

A. ROIB. arbitrary

allocationC. percentage of

salesD. competitive

parity


61.

When using the competitive parity budgeting method, the firm:

A. matches its share of total industry advertising expenditures to its market share.

B. spends as much as it can.

C. allocates some portion of planned sales for the period to advertising.

D. spends the same total amount as its major competitors spend.

62.

For which of the following methods of determining budget would a marketing department manager be most likely to use input from a clipping service?

A. ROIB. arbitrary


salesD. competitive

parity 63.

The _____ method of budgeting is being employed when expenditures are allocated according information about industry averages for advertising. The budget is set to maintain a level consistent with industry spending.




D. competitive parity


64.

A disadvantage associated with the _____ method is its assumption that because firms have similar promotional expenditures their programs will be equally effective.

A. return on investment

B. affordable



65.

The _____ method of budgeting is being employed when expenditures are allocated by looking at the revenue generated from sales of the product during one year. The information gathered from this examination is used to determine the next year's dollar amounts.


B. ROIC. payout

planningD. return on

investment 66.

In the _____ method of budget determination, advertising is considered an investment, similar to plant and equipment.

A. payout planning


C. ROI budgeting



67.

Top-down budgeting methods are commonly used because of:

A. their effectiveness.

B. upper management's desire for control.

C. the growing availability of computer simulations.

D. the ease with which a manager can assess the impact of sales on ROI.

68.

The task and objective method of budgeting as well as the payout plan are both examples of the _____ approach.

A. trading-up

B. top-down

C. bottom-up

D. build-up

69.

Defining the communications objectives to be accomplished and estimating the costs associated with the performance of the necessary strategies and activities are steps in the _____ method of budgeting.


B. payout planning

C. ROID. objective and

task


70.

Which of the following is an example of a budgeting allocation method that uses a build-up approach?

A. ROIB. competitive

parityC. objective and

taskD. arbitrary

allocation 71.

All of the following are components of the objective and task method EXCEPT:

A. a re-evaluation of objectives.

B. determination of competitor's expenditures.

C. isolation of objectives.

D. estimation of required expenditures.

72.

The first task in the objective and task method of budgeting is to:

A. conduct a system analysis.

B. create an organisational budget.

C. isolate advertising objectives.

D. determine which tasks need to be accomplished.


73.

Which of the following statements provides a good rule of thumb for setting the advertising budget for a new product?

A. The advertising budget should be double that needed to maintain the desired market share.

B. The advertising budget should be equal to that of the largest market shareholder in the product category.

C. The advertising budget should be as much as the firm can afford.

D. The advertising budget should be 10% greater than the average budget planned for the entire payout period.

74.

The objective and task method is most difficult to use when:

A. the product to be promoted is intangible and in the maturity stage of its product life cycle.

B. the product to be promoted is in the decline stage of its product life cycle.

C. the product to be promoted is a cash cow.

D. the product to be promoted is new to the market.

75.

_____ is a method for allocating budgets designed to determine the investment value of the advertising appropriation.

A. Payout planning

B. Percentage of sales method

C. Competitive parity

D. Arbitrary allocation


76.

During situation analysis, a useful budgeting technique to determine a ballpark figure for setting feasible objectives is the _____ method.

A. payout planning



D. 401k

77.

When used in conjunction with the objective and task method, _____ is the most useful method for establishing an advertising budget.


B. payout planning

C. the affordable method

D. concave analysis

78.

Which of the following is NOT a factor that typically influences the budget allocation decision?

A. client/agency policies

B. market size

C. market potential

D. the ad agency's organisational structure


79.

Demand in certain markets will be higher than in other markets. These are said to have higher:

A. market share.

B. market potential.

C. consumer readiness.

D. economies of scale.

80.

As a result of _____, large advertisers can maintain advertising expenditure shares that are smaller than their market shares because they get lower advertising rates and accrue the advantages of advertising several products jointly.

A. economies of scale

B. differential advertising advantages


D. a concave-downward response

81.

As a result of economies of scale, large advertisers:

A. are likely to enjoy more favourable advertising time and space than smaller advertisers.

B. get lower advertising rates than smaller advertisers.

C. accrue the advantages of advertising several products jointly.

D. benefit from all of the given answers.


82.

As a result of economies of scale, smaller advertisers:

A. are likely to enjoy more favourable advertising time and space than large advertisers.

B. have declining average costs of production.

C. get higher advertising rates than large advertisers.

D. can maintain advertising expenditure shares that are smaller than their market shares.

83.

Which of the following is an organisational characteristic that can have a direct effect on the budget allocation process?

A. approval and negotiation channels

B. pressure from senior managers to arrive at the optimal budget

C. power and politics in the organisational hierarchy


84.

Which of the following is NOT an organisational characteristic that often has a direct effect on the budget allocation process?

A. the preferences and experiences of the decision maker

B. the degree of formalisation

C. the ratio of staff to line personnel

D. the willingness to employ outside consultants


85.

The more specific the firm's advertising objectives, the:

A. easier it becomes to measure advertising effectiveness.

B. more difficult it is for competitor's advertising to be effective.

C. easier it is to measure the advertising-sales response function.

D. smaller the funding needed to meet advertising goals.

86.

John’s task is to determine what was accomplished by his company's advertising and promotional program for a vinyl siding cleanser. You are able to tell him that:

A. his task is impossible.

B. all he needs is sales results to determine what the program accomplished.

C. his task is easier if specific communications objectives are set.

D. all he needs is post-promotional consumer awareness levels to determine what the program accomplished.

87.

Ace Computers has an objective of increasing its share of the home personal computer market by 5% during the upcoming year. This is an example of a(n) _____ objective.

A. marketing

B. organisational

C. advertising

D. functional


88.

Pace Foods had a goal of expanding its business beyond its traditional Texas market base. This goal is an example of a _____ objective while the goal of establishing a position of authenticity and making Mexican food seem fun is an example of a(n) _____ objective:

A. communication; marketing

B. communication; positioning

C. marketing; communication

D. positioning; organisational

89.

From 1986 to 1992, sales of luxury cars in the USA declined from 1.6 million to 1.2 million while several new competitors entered this segment of the market, such as Lexus, Acura and Infiniti. How should this decline in overall sales have affected a company such as BMW that wanted to determine how its advertising impacted its sales?

A. The decline should really have meant very little if the company had a very good advertising campaign.

B. BMW would have found that it is difficult to measure the impact of its advertising in terms of sales when the overall market was declining and competition was increasing.

C. BMW should have used sales as the primary method for determining advertising effectiveness since it was important to generate sales under these conditions.

D. BMW would have needed a totally new advertising campaign since the overall market was declining.

90.

Heinz developed a sales promotion program called ‘All About Family’. It offered a coupon for free Halloween sweets when you purchased any of five different participating Heinz brands. Cents-off coupons for the participating brands were placed in newspaper inserts. The campaign also featured a contest called the ‘Ultimate Family Night’ sweepstakes. Heinz management most likely used _____ objectives to measure the effectiveness of this sales promotion.

A. communication persuasiveness

B. short-term sales

C. long-term sales

D. brand inquiry


91.

For which of the following would an advertiser be most likely to use a sales-orientated objective?

A. a direct response ad for a record album

B. a commercial for a new type of electric-powered automobile

C. a political announcement

D. an anti-drug public service announcement

92.

In January 2003, Philip-Morris Companies, Inc. and Kraft Foods became the Altria Group. The name change reflected the fact that the company had altered itself structurally, behaviourally and culturally. The new name was designed to focus attention on the company's superior performance, financial strength and its commitment to integrity and corporate responsibility. Advertising to make consumers aware of the name change would more than likely have _____ objectives.

A. sales-orientated



D. communications

93.

In January 2003, Philip Morris Companies Inc. and Kraft Foods became the Altria Group. The name change reflected the fact the company had altered itself structurally, behaviourally and culturally. The new name was designed to focus attention on the company's superior performance, financial strength and its commitment to integrity and corporate responsibility. To determine how successful it was in making consumers aware of its name change and its new positioning strategy, the Altria Group could have used:

A. zero-based communications planning.

B. a benchmark orientation.

C. DAGMAR.

D. the carryover effect.


94.

In January 2003, Philip Morris Companies Inc. and Kraft Foods became the Altria Group. The name change reflected the fact the company had altered itself structurally, behaviourally and culturally. The new name was designed to focus attention on the company's superior performance, financial strength and its commitment to integrity and corporate responsibility. Which of the following statements about the communications objectives the company would have used as part of this repositioning strategy is true?

A. The communications objectives established with this strategy would need to be abstract.

B. It would be impossible for the company to have any benchmark measures for determining whether it had reached its communications objectives.

C. A communications objective concerning the repositioning of the Altria Group would take longer to accomplish than an objective designed to create brand awareness.

D. The target audience could not be specifically defined in the communications objective.

95.

Which of the following statements describes a weakness inherent in the use of the marginal analysis model for establishing an advertising budget?

A. Using this model, it is difficult to demonstrate the effects of advertising and promotions on sales.

B. Environmental factors not considered by the model may affect the effectiveness of the promotional program.

C. Product quality, pricing and distribution may also contribute to sales.

D. All of the given answers describe a weakness inherent in the use of the marginal analysis model for establishing an advertising budget.

96.

Advertising objectives are what the advertising will achieve.

True False

97.

Benchmark measures provide a basis for specifying objectives.

True False

98.

Encouraging consumers who have never used a brand to try it is a poor communications objective.

True False


99.

Objectives are typically set for a six-month period.

True False

100.

RTTT and SMARTT are objective-setting acronyms.

True False

101.

Most of the models used to establish marketing communication budgets can be categorised as taking an economic or a sales response perspective.

True False

102.

The arbitrary method, while rudimentary, is the best method for budgeting.

True False

103.

Using past experience as a guide will assist in determining costs for the objective and task method.

True False

104.

In the affordable method (often referred to as the ‘all-you-can-afford method’), the company determines the amount to be spent in various areas such as production and operations.

True False

105.

John Philip Jones compared the brand’s share of market with its share of advertising voice.

True False

106.

Malcom Wright combined axioms with empirical optimisation to stimulate profits.

True False


107.

The Advertising Opportunity Score is a simple, easy-to-use management tool that evaluates the advertising opportunity in respect of three important factors—product, market and company.

True False

108.

Colley developed a 52-point checklist of advertising tasks to characterise the contribution of advertising and serve as a starting point for establishing objectives.

True False

109.

There is one universally accepted method of setting a budget figure.

True False


10 Key

1.

The purpose of setting specific advertising goals and objectives is to:

A. provide a benchmark against which success or failure can be measured.

B. put constraints on the creative department.

C. have a method of determining when to delete products from the product line.

D. forecast the market share level that can be attained by good advertising.

Belch - Chapter 10 #1

Blooms: KnowledgeDifficulty: Easy

Learning Objective: 10.1 To recognise the importance and value of setting specific objectives for advertising and IMC

2.

Meaningful objectives can also be a useful guide for:

A. creative executions.

B. customer satisfaction.

C. understanding market trends.

D. decision making.





3.

Which of the following is NOT given as a realistic reason for setting specific objectives for an integrated marketing communications program?

A. Specific objectives serve as communication devices and facilitate coordination of various groups working on the campaign.

B. Specific objectives serve as a guide for planning and decision making.

C. Specific objectives provide a benchmark against which success or failure of a campaign can be measured.

D. Specific objectives provide specific ideas on how to develop more creative and effective advertising.



Learning Objective: 10.2 To understand the role objectives play in the IMC planning process and the relationship of marketing communication objectives to marketing objectives

4.

_____ objectives are types of objectives that are usually stated in terms of specific, measurable outcomes such as sales volume, market share or return on investment.

A. Sales

B. Marketing

C. Communication

D. Advertising





5.

Which of the following statements best describes the relationship between marketing and IMC objectives?

A. Marketing objectives and communications objectives are synonymous.

B. Marketing objectives evolve from communication objectives.

C. IMC objectives are derived from marketing objectives.

D. For a successful campaign, communications objectives can be developed before or after the development of marketing objectives.




6.

To be effective, marketing objectives need to be:

A. realistic and attainable.

B. erudite and challenging.

C. philosophical and fungible.

D. long-term and qualitative.





7.

Marketing goals defined in terms of sales, profits, or market share increases are:

A. situational response objectives.

B. usually not appropriate for marketing communication objectives.

C. integrated marketing communications objective.

D. relationship marketing objectives.




8.

To develop integrated marketing communications objectives, managers need the situation analysis to identify:

A. the marketing issues.

B. the marketing communication issues.

C. ‘Where are we now?’.






9.

Many marketing managers approach promotion from a(n) _____ perspective and believe the objective of advertising and other promotional mix elements is to relay information about a product to customers.

A. informational

B. communications

C. sales-orientated

D. segmentation



Learning Objective: 10.3 To know the differences between behavioural and communication objectives, and the issues regarding the use of each

10.

Many marketing managers prefer sales-orientated objectives for advertising because they believe:

A. the reason a company spends money on advertising and promotion is to sell its products or service.

B. money spent on advertising and promotion should show measurable results.

C. sales-orientated objectives help get everyone involved in the promotional program to think about how advertising and promotion will influence sales.

D. all of the given answers are true.





11.

Financially orientated managers who view marketing communications as an expense rather than an investment are likely to prefer _____ objectives for advertising and other promotional areas.

A. sales-orientated

B. communication

C. positioning

D. image




12.

In addition to advertising and promotion, _____ might also influence a company's sales.

A. product quality

B. price

C. distribution






13.

The concept of advertising expenditures producing long-term as well as immediate results is known as:

A. the carryover effect.

B. the communication effect.

C. the low-involvement effect.

D. the halo effect.




14.

The carryover effect:

A. has no impact on sales objectives.

B. has no effect on the relationship between advertising and sales.

C. encourages the use of non-specific objectives.

D. is particularly apparent with mature, low-priced and frequently purchased products.





15.

Which of the following is likely to be a problem for a manager who uses sales as a measure of advertising effectiveness?

A. Sales results offer little guidance or direction to those responsible for planning and developing the advertising program.

B. There is a short, often unmeasurable, time period between when advertising is run and when sales actually occur.

C. Sales results are affected by no marketing mix variable other than price and promotion.

D. No internal environmental variables have any significant influence on sales results.




16.

Using sales results as an advertising objective can be difficult due to:

A. the difficulty in isolating the effects of advertising on sales.

B. the fact there is often a lagged effect whereby the effect of advertising on sales is not immediate.

C. the fact advertising objectives emphasising sales are generally not good operational guides to decision making.






17.

Direct-response advertisers generally set objectives and measure success in terms of:

A. brand awareness.

B. brand attitudes.

C. purchase intentions.

D. sales response generated by an ad.




18.

Sales-orientated objectives are appropriate for:

A. all internet marketing.

B. retail advertising promoting a sale or special event.

C. products that have been introduced in a highly volatile market.

D. any advertising campaign aimed at maintaining brand awareness.





19.

Various response hierarchy variables such as awareness, knowledge, liking, preference, conviction and purchase are the basis for:

A. marketing objectives.

B. sales-orientated objectives.

C. image objectives.

D. communications objectives.




20.

Advocates of communication-based objectives for advertising propose using _____ as a basis for setting these objectives.

A. sales

B. market share

C. stages of a hierarchical response model

D. carryover effects





21.

Which of the following is at the top of the communication effects pyramid?

A. Awareness

B. Knowledge

C. Liking

D. Purchase/repurchase




22.

Managers who use the communications effects pyramid to set objectives believe:

A. lower-level objectives such as purchase and reuse form the foundation of the communications program.

B. the foundation of the communications program is set by accomplishing lower-level objectives such as awareness, knowledge and comprehension.

C. advertising and promotion should first accomplish lower-level objectives such as trial and purchase.

D. advertising and promotion should first accomplish higher-order objectives such as trial and purchase and then create awareness and brand knowledge.





23.

‘Encouraging current drinkers of Coca-Cola to drink more of the beverage’ would be an example of a _____ objective.

A. sales-orientated



D. communications


Blooms: ApplicationDifficulty: Medium


24.

Which of the following statements about communications objectives is true?

A. When setting objectives using the communications effect pyramid, the last step reached is trial.

B. Sales goal cannot be translated into communications objectives.

C. Marketing and advertising managers do not rely on experience and intuition when setting communications goals.

D. Communications objectives are the criteria used in the DAGMAR approach to setting advertising goals.





25.

DAGMAR is:

A. a philosophy of advertising goal setting.

B. a model of consumer behaviour.

C. a method of setting sales objectives.

D. the most often used method of setting objectives.




26.

_____ is an approach to setting advertising goals and objectives, which states that communication effects are the logical basis for advertising goals and objectives against which success or failure should be measured.

A. The carryover effect

B. The hierarchy of effects model

C. Zero-based communications planning

D. DAGMAR





27.

According to DAGMAR, the basic function of advertising is to:

A. create sales.

B. communicate.

C. increase market share.

D. generate action.




28.

Under the DAGMAR model, a(n) _____ can be performed by and attributed to advertising rather than a combination of marketing factors.

A. advertising hierarchical plan

B. functional communication change

C. communications task

D. marketing task





29.

According to the criteria outlined in DAGMAR, which of the following is the best statement of a quantitative communications objective?

A. ‘Increase product users to 40% of the total market.’

B. ‘Win new customers and increase sales volume by 15%.’

C. ‘Increase the number of customers mentioning the brand name when asked for brand preference from 40% to 50%.’

D. ‘Increase awareness of the brand.’


Blooms: ApplicationDifficulty: Easy


30.

Using the DAGMAR approach, which of the following is NOT a stage of commercial communication?

A. awareness

B. comprehension

C. conviction

D. sales





31.

For which of the following advertising communication tasks should the specified time period required be the longest?

A. creating brand awareness

B. increasing brand awareness levels

C. creating knowledge regarding a brand attribute

D. repositioning a brand




32.

DAGMAR MOD II was developed to alleviate problems with:

A. the response hierarchy used in the original DAGMAR model.

B. the costs of using DAGMAR.

C. the fact DAGMAR ignores sales results.

D. setting benchmark measures.



Learning Objective: 10.4 To recognise some problems marketers encounter in setting objectives for their IMC programs

33.

Which of the following is NOT an example of a common criticism of DAGMAR?

A. It ignores communications objectives.

B. It is difficult to implement.

C. It is a costly and time-consuming process.

D. It runs counter to the belief that the function of advertising is to create sales.


Full file at http://testbanksinstant.eu/ Test-Bank-for-Advertising-An-Integrated-Marketing-Communication-Perspective-3E-Blooms: Knowledge

Difficulty: EasyLearning Objective: 10.4 To recognise some problems marketers encounter in setting objectives for their IMC programs

34.

The letters in the RTTT models spell out the quality of the objectives and the goals they seek to achieve. What do the letters represent?

A. Regression, Trial, Target market and Theory

B. ROI, Target market, Timing and Task

C. Realistic, Target market, Task and Timeframe

D. Regression, Timing, Term and (market) Type




35.

To more fully appreciate the value of advertising and promotion, managers should treat the communications budget as a(n):

A. asset.

B. expense.

C. liability.

D. investment.



Learning Objective: 10.5 To understand the process of budgeting for IMC


36.

In marginal analysis, all of the following should be considered EXCEPT:

A. sales.

B. fixed costs of advertising.

C. advertising expenditures and other variable costs.

D. net worth.




37.

The _____ function model is based on the microeconomics law of diminishing returns.

A. concave-upward

B. S-shaped demand

C. S-shaped response

D. concave-downward



Learning Objective: 10.6 To understand the theoretical issues involved in budget setting

38.

The concave-downward function model is based on:

A. the microeconomics law of diminishing returns.

B. the economic law of supply and demand.

C. price elasticity of demand quotients.

D. the change in contribution margins as item price is changed.


Blooms: Knowledge

Full file at http://testbanksinstant.eu/ Test-Bank-for-Advertising-An-Integrated-Marketing-Communication-Perspective-3E-Difficulty: Easy


39.

The S-shaped response function implies that:

A. initial advertising expenditures will have little impact on sales.

B. advertising expenditures will have major impact on sales.

C. sales effects will follow the microeconomic law of diminishing returns.

D. sales will immediately increase then decrease.




40.

The two models that are commonly used to explain the relationship between advertising and sales are the:

A. concave-downward function and the S-shaped response function.

B. S-shaped response function and the concave-upward function.

C. marginal utility function and the S-shaped demand function.

D. S-shaped demand function and the convex-downward function.





41.

Well-known brand name products do not receive incremental advantages from increased dollar expenditures on advertising. Once the ad hits the market, subsequent budget increases result in little or no incremental gains. This might best be explained by:




D. rapidly diminishing returns.




42.

According to the concave-downward model:








43.

According to the S-shaped response curve:







Difficulty: EasyLearning Objective: 10.6 To understand the theoretical issues involved in budget setting

44.

A marketing firm decides to purchase media time in an attempt to sell its new product. After purchasing approximately $1 million dollars of time, it has noticed no impact on the sales of the product. However, at $3 million, a substantial increase is shown. This might best be explained by:




D. an S-shaped response.




45.

The S-shaped response curve suggests:

A. advertising effectiveness will not be related to spending.

B. very low spending levels will not work.

C. advertising effectiveness will vary directly according to spending levels.

D. the carryover effect is especially true for low-priced, frequently purchased consumer products.





46.


A. which stage of its life cycle the product is in

B. whether competition is active or concentrated

C. whether the marketer is a pioneer in the market

D. All of the given answers




47.


A. whether the company uses communications or sales objectives

B. corporate structure

C. the basis for product differentiation

D. the extent of selective retention




48.

When higher-level executives determine the budget amounts to be allocated for each department's advertising expenditures, a _____ approach is being used:

A. bottom-up

B. marginal contribution

C. top-down

D. Delphi



Difficulty: EasyLearning Objective: 10.7 To know the various methods of budget setting

49.

All of the following are considered top-down approaches to determining budgets EXCEPT:

A. the objective and task method.

B. the affordable method.

C. the percentage of sales method.




Learning Objective: 10.7 To know the various methods of budget setting

50.

Which of the following is NOT a top-down approach to budget setting?

A. the affordable method



D. payout planning





51.

The _____ method of budgeting is being employed when expenditures are allocated by an analysis of expenditures for all aspects of producing and marketing the product. The ad budget is determined by making sure a certain amount is not exceeded.



C. affordable





52.

You know the _____ method of budgeting is being employed after hearing an experienced marketing department manager respond to a new employee's question, ‘How was the ad budget established last year?’ by saying, ‘The same way it's always been done. I just have an instinct for how much should be budgeted where.’



C. ROID. return on

investment

Belch - Chapter 10 #52Blooms: Knowledge



53.

Which top-down budgeting method is being employed when expenditures are allocated by assigning a budget based on gut feelings?



C. affordable method

D. payout planning




54.

The most commonly utilised method of budget determination by large firms is:

A. competitive parity.

B. objective and task.

C. percentage of sales.






55.

The _____ method of budgeting is being employed when expenditures are allocated by assigning a part of the cost of the product to be allocated to advertising. The total budget is based on units sold.








56.

To set an advertising budget, the marketer of filing cabinets examines advertising-to-sales ratios published in trade magazines and then allocates a percentage of sales dollars to the advertising effort. Which two budgeting methods are being employed?

A. competitive parity and percentage of sales

B. competitive parity and payout planning

C. payout planning and percentage of sales

D. percentage of sales and objective and task





57.

Which of the following budgeting procedures would be used if a firm wanted a method that is simple to understand and financially safe?


B. marginal analysis






58.

The _____ method of budgeting uses advertising-to-sales ratio data.

A. objective and task

B. affordable


D. ROI



59.

The major problem associated with the _____ budgeting method is a reversal of the cause and effect relationship.

A. percentage of sales



D. S-shaped response



Full file at http://testbanksinstant.eu/ Test-Bank-for-Advertising-An-Integrated-Marketing-Communication-Perspective-3E-Learning Objective: 10.7 To know the various methods of budget setting

60.

The _____ budgetary allocation method is designed to promote stability and minimise marketing warfare as well as taking advantage of the collective wisdom of the industry.

A. ROIB. arbitrary


salesD. competitive

parity



61.

When using the competitive parity budgeting method, the firm:

A. matches its share of total industry advertising expenditures to its market share.

B. spends as much as it can.

C. allocates some portion of planned sales for the period to advertising.

D. spends the same total amount as its major competitors spend.




62.

For which of the following methods of determining budget would a marketing department manager be most likely to use input from a clipping service?

A. ROIB. arbitrary


salesD. competitive

parity




63.

The _____ method of budgeting is being employed when expenditures are allocated according information about industry averages for advertising. The budget is set to maintain a level consistent with industry spending.








64.

A disadvantage associated with the _____ method is its assumption that because firms have similar promotional expenditures their programs will be equally effective.

A. return on investment

B. affordable







65.

The _____ method of budgeting is being employed when expenditures are allocated by looking at the revenue generated from sales of the product during one year. The information gathered from this examination is used to determine the next year's dollar amounts.


B. ROIC. payout

planningD. return on

investment



66.

In the _____ method of budget determination, advertising is considered an investment, similar to plant and equipment.

A. payout planning


C. ROI budgeting





67.

Top-down budgeting methods are commonly used because of:

A. their effectiveness.

B. upper management's desire for control.

C. the growing availability of computer simulations.

D. the ease with which a manager can assess the impact of sales on ROI.



Full file at http://testbanksinstant.eu/ Test-Bank-for-Advertising-An-Integrated-Marketing-Communication-Perspective-3E-Learning Objective: 10.7 To know the various methods of budget setting

68.

The task and objective method of budgeting as well as the payout plan are both examples of the _____ approach.

A. trading-up

B. top-down

C. bottom-up

D. build-up




69.

Defining the communications objectives to be accomplished and estimating the costs associated with the performance of the necessary strategies and activities are steps in the _____ method of budgeting.


B. payout planning

C. ROID. objective and

task



70.

Which of the following is an example of a budgeting allocation method that uses a build-up approach?

A. ROIB. competitive

parityC. objective and

taskD. arbitrary

allocation




71.

All of the following are components of the objective and task method EXCEPT:

A. a re-evaluation of objectives.

B. determination of competitor's expenditures.

C. isolation of objectives.

D. estimation of required expenditures.




72.

The first task in the objective and task method of budgeting is to:

A. conduct a system analysis.

B. create an organisational budget.

C. isolate advertising objectives.

D. determine which tasks need to be accomplished.





73.

Which of the following statements provides a good rule of thumb for setting the advertising budget for a new product?

A. The advertising budget should be double that needed to maintain the desired market share.

B. The advertising budget should be equal to that of the largest market shareholder in the product category.

C. The advertising budget should be as much as the firm can afford.

D. The advertising budget should be 10% greater than the average budget planned for the entire payout period.




74.

The objective and task method is most difficult to use when:

A. the product to be promoted is intangible and in the maturity stage of its product life cycle.

B. the product to be promoted is in the decline stage of its product life cycle.

C. the product to be promoted is a cash cow.

D. the product to be promoted is new to the market.




75.

_____ is a method for allocating budgets designed to determine the investment value of the advertising appropriation.

A. Payout planning

B. Percentage of sales method

C. Competitive parity

D. Arbitrary allocation


Blooms: Knowledge



76.

During situation analysis, a useful budgeting technique to determine a ballpark figure for setting feasible objectives is the _____ method.

A. payout planning



D. 401k




77.

When used in conjunction with the objective and task method, _____ is the most useful method for establishing an advertising budget.


B. payout planning

C. the affordable method

D. concave analysis





78.

Which of the following is NOT a factor that typically influences the budget allocation decision?

A. client/agency policies

B. market size

C. market potential

D. the ad agency's organisational structure




79.

Demand in certain markets will be higher than in other markets. These are said to have higher:

A. market share.

B. market potential.

C. consumer readiness.

D. economies of scale.




80.

As a result of _____, large advertisers can maintain advertising expenditure shares that are smaller than their market shares because they get lower advertising rates and accrue the advantages of advertising several products jointly.

A. economies of scale

B. differential advertising advantages


D. a concave-downward response




81.

As a result of economies of scale, large advertisers:

A. are likely to enjoy more favourable advertising time and space than smaller advertisers.

B. get lower advertising rates than smaller advertisers.

C. accrue the advantages of advertising several products jointly.

D. benefit from all of the given answers.




82.

As a result of economies of scale, smaller advertisers:

A. are likely to enjoy more favourable advertising time and space than large advertisers.

B. have declining average costs of production.

C. get higher advertising rates than large advertisers.

D. can maintain advertising expenditure shares that are smaller than their market shares.





83.

Which of the following is an organisational characteristic that can have a direct effect on the budget allocation process?

A. approval and negotiation channels

B. pressure from senior managers to arrive at the optimal budget

C. power and politics in the organisational hierarchy





84.

Which of the following is NOT an organisational characteristic that often has a direct effect on the budget allocation process?

A. the preferences and experiences of the decision maker

B. the degree of formalisation

C. the ratio of staff to line personnel

D. the willingness to employ outside consultants




85.

The more specific the firm's advertising objectives, the:

A. easier it becomes to measure advertising effectiveness.

B. more difficult it is for competitor's advertising to be effective.

C. easier it is to measure the advertising-sales response function.

D. smaller the funding needed to meet advertising goals.


Blooms: Evaluative

Full file at http://testbanksinstant.eu/ Test-Bank-for-Advertising-An-Integrated-Marketing-Communication-Perspective-3E-Difficulty: Medium


86.

John’s task is to determine what was accomplished by his company's advertising and promotional program for a vinyl siding cleanser. You are able to tell him that:

A. his task is impossible.

B. all he needs is sales results to determine what the program accomplished.

C. his task is easier if specific communications objectives are set.

D. all he needs is post-promotional consumer awareness levels to determine what the program accomplished.




87.

Ace Computers has an objective of increasing its share of the home personal computer market by 5% during the upcoming year. This is an example of a(n) _____ objective.

A. marketing

B. organisational

C. advertising

D. functional





88.

Pace Foods had a goal of expanding its business beyond its traditional Texas market base. This goal is an example of a _____ objective while the goal of establishing a position of authenticity and making Mexican food seem fun is an example of a(n) _____ objective:

A. communication; marketing

B. communication; positioning

C. marketing; communication

D. positioning; organisational




89.

From 1986 to 1992, sales of luxury cars in the USA declined from 1.6 million to 1.2 million while several new competitors entered this segment of the market, such as Lexus, Acura and Infiniti. How should this decline in overall sales have affected a company such as BMW that wanted to determine how its advertising impacted its sales?

A. The decline should really have meant very little if the company had a very good advertising campaign.

B. BMW would have found that it is difficult to measure the impact of its advertising in terms of sales when the overall market was declining and competition was increasing.

C. BMW should have used sales as the primary method for determining advertising effectiveness since it was important to generate sales under these conditions.

D. BMW would have needed a totally new advertising campaign since the overall market was declining.





90.

Heinz developed a sales promotion program called ‘All About Family’. It offered a coupon for free Halloween sweets when you purchased any of five different participating Heinz brands. Cents-off coupons for the participating brands were placed in newspaper inserts. The campaign also featured a contest called the ‘Ultimate Family Night’ sweepstakes. Heinz management most likely used _____ objectives to measure the effectiveness of this sales promotion.

A. communication persuasiveness

B. short-term sales

C. long-term sales

D. brand inquiry




91.

For which of the following would an advertiser be most likely to use a sales-orientated objective?

A. a direct response ad for a record album

B. a commercial for a new type of electric-powered automobile

C. a political announcement

D. an anti-drug public service announcement





92.

In January 2003, Philip-Morris Companies, Inc. and Kraft Foods became the Altria Group. The name change reflected the fact that the company had altered itself structurally, behaviourally and culturally. The new name was designed to focus attention on the company's superior performance, financial strength and its commitment to integrity and corporate responsibility. Advertising to make consumers aware of the name change would more than likely have _____ objectives.

A. sales-orientated



D. communications




93.

In January 2003, Philip Morris Companies Inc. and Kraft Foods became the Altria Group. The name change reflected the fact the company had altered itself structurally, behaviourally and culturally. The new name was designed to focus attention on the company's superior performance, financial strength and its commitment to integrity and corporate responsibility. To determine how successful it was in making consumers aware of its name change and its new positioning strategy, the Altria Group could have used:

A. zero-based communications planning.

B. a benchmark orientation.

C. DAGMAR.

D. the carryover effect.





94.

In January 2003, Philip Morris Companies Inc. and Kraft Foods became the Altria Group. The name change reflected the fact the company had altered itself structurally, behaviourally and culturally. The new name was designed to focus attention on the company's superior performance, financial strength and its commitment to integrity and corporate responsibility. Which of the following statements about the communications objectives the company would have used as part of this repositioning strategy is true?

A. The communications objectives established with this strategy would need to be abstract.

B. It would be impossible for the company to have any benchmark measures for determining whether it had reached its communications objectives.

C. A communications objective concerning the repositioning of the Altria Group would take longer to accomplish than an objective designed to create brand awareness.

D. The target audience could not be specifically defined in the communications objective.




95.

Which of the following statements describes a weakness inherent in the use of the marginal analysis model for establishing an advertising budget?

A. Using this model, it is difficult to demonstrate the effects of advertising and promotions on sales.

B. Environmental factors not considered by the model may affect the effectiveness of the promotional program.

C. Product quality, pricing and distribution may also contribute to sales.

D. All of the given answers describe a weakness inherent in the use of the marginal analysis model for establishing an advertising budget.


Blooms: ComprehensionDifficulty: Medium


96.

Advertising objectives are what the advertising will achieve.

TRUE





97.

Benchmark measures provide a basis for specifying objectives.

TRUE




98.

Encouraging consumers who have never used a brand to try it is a poor communications objective.

FALSE




99.

Objectives are typically set for a six-month period.

FALSE




100.

RTTT and SMARTT are objective-setting acronyms.

TRUE




101.

Most of the models used to establish marketing communication budgets can be categorised as taking an economic or a sales response perspective.

TRUE





102.

The arbitrary method, while rudimentary, is the best method for budgeting.

FALSE




103.

Using past experience as a guide will assist in determining costs for the objective and task method.

TRUE




104.

In the affordable method (often referred to as the ‘all-you-can-afford method’), the company determines the amount to be spent in various areas such as production and operations.

TRUE




105.

John Philip Jones compared the brand’s share of market with its share of advertising voice.

TRUE




106.

Malcom Wright combined axioms with empirical optimisation to stimulate profits.

TRUE





107.

The Advertising Opportunity Score is a simple, easy-to-use management tool that evaluates the advertising opportunity in respect of three important factors—product, market and company.

TRUE




108.

Colley developed a 52-point checklist of advertising tasks to characterise the contribution of advertising and serve as a starting point for establishing objectives.

TRUE




109.

There is one universally accepted method of setting a budget figure.

FALSE





10 Summary

Category # of Que stions

Belch - Chapter 10 109Blooms: Application 11Blooms: Comprehension 1Blooms: Evaluative 1Blooms: Knowledge 96Difficulty: Easy 97Difficulty: Medium 12Learning Objective: 10.1 To recognise the importance and value of setting specific objectives for advertising and IMC

3


13


31


3

Learning Objective: 10.5 To understand the process of budgeting for IMC 3Learning Objective: 10.6 To understand the theoretical issues involved in budget setting 13Learning Objective: 10.7 To know the various methods of budget setting 43

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