Cross-Cultural Marketing Exam
Answer Key
Course Introduction
Cross-Cultural Marketing examines the challenges and opportunities presented by marketing products and services across diverse cultural environments. This course explores how cultural values, norms, and behaviors influence consumer preferences and purchasing decisions globally. Students will analyze frameworks for understanding cultural differences, such as Hofstedes dimensions, and learn strategies to adapt marketing mix elements including product, price, promotion, and distribution to effectively reach multicultural audiences. Case studies and real-world examples will illustrate successful and unsuccessful cross-cultural marketing campaigns, highlighting the importance of cultural sensitivity, ethical considerations, and global branding in todays interconnected marketplace.
Recommended Textbook
Global Marketing 9th Edition by Warren J. Keegan
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Page 2
Chapter 1: Introduction to Global Marketing
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Q1) Starbucks entered India via an alliance with the Tata Group. This is an example of "market penetration."
A)True
B)False
Answer: False
Q2) Discuss the impact of management myopia and organizational culture on the globalization of a corporation?
Answer: There are several examples where management simply ignores opportunities to pursue global marketing. A company that is "nearsighted" and ethnocentric will not expand geographically. For example, Anheuser-Busch, the brewer of Budweiser beer, lost its independence after years of focusing primarily on the domestic U.S. market. Myopia is also a recipe for market disaster if headquarters attempts to dictate when it should listen. Global marketing does not work without a strong local team that can provide information about local market conditions.
Q3) People and organizations that are both able and willing to buy are considered as markets.
A)True
B)False
Answer: True
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Chapter 2: The Global Economic Environment
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Q1) The Big Mac Index shows that the price of the Big Mac in China converted from the local currency, the yuan, to be $2.18, whereas its price in the United States is $3.73. This shows that:
A)the Big Mac is more popular in China than in the United States.
B)the Big Mac is less expensive in the United States than in China.
C)the Chinese yuan is overvalued when compared to US $.
D)the Chinese yuan is undervalued against the US $.
E)beef is less expensive in China than in the United States.
Answer: D
Q2) A country with a positive current account balance has a trade deficit; that is, the outflow of money to pay for imports exceeds the inflow of money for sales of exports.
A)True
B)False
Answer: False
Q3) In reality, market capitalism and centrally planned socialism do not exist in "pure" form.
A)True
B)False
Answer: True
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Page 4
Chapter 3: The Global Trade Environment
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Q1) McDonald's, Philips Electronics, 3M International and many other similar well known global corporations are operating in Central and Eastern Europe. Some countries in the region are still recovering from decades of command economies. What makes the region so attractive for global business corporations?
Answer: The extraordinary political and economic reforms that swept through Central and Eastern Europe in the 1990s attracted the attention of many corporations toward the new 430-million person market. The transition in the region from command to market economies has toppled a number of entrenched institutions. New pacts such as Central European Free Trade association (CEFTA)are being formed. The signatories are pledging cooperation in areas such as infrastructure and telecommunications. The governments of Russia and Belarus agreed to form a customs union and remove border posts between their two countries. Ford opened a $10 million vehicle assembly plant outside Minsk, predicting future economic growth in that region. The markets of central and Eastern Europe present interesting opportunities since they are in the process of transition. Also, with wage rates in these regions being much lower than those in Spain or Portugal, the region offers attractive locations for low-cost manufacturing.
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Page 5
Chapter 4: Social and Cultural Environments
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Q1) In surveys about color preferences, 50 percent of respondents indicate white is their favorite-and it is favored by a wide margin over the next-preferred color, blue.
A)True
B)False
Q2) High-context messages are explicit and specific; words carry most of the communication power.
A)True
B)False
Q3) Colgate discovered that in Spanish colgate is a verb form that means "go hang yourself."
A)True
B)False
Q4) The power distance dimension reflects the degree of trust among members of society. Thus, the higher the power distance (PDI)the:
A)greater is uncertainty avoidance.
B)lower is the level of trust.
C)higher is tolerance for ambiguity.
D)greater is male dominance
E)lower is the harmony.
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Chapter 5: The Political, Legal, and Regulatory
Environments
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Q1) Italy recently introduced the Reguzzoni-Versace Law which is intended to regulate trade in textiles, leather, and footwear. All of the following statements pertaining to the law are correct except:
A)at least four stages of production should occur in Italy for the product to be labeled as "Made in Italy."
B)the countries in which the remaining production stages took place must be identified.
C)Brussels objected on grounds that the law conflicts with restrictions provided by the European Union.
D)EU regulators view the law as "protectionist."
E)the law is more stringent than the existing laws where only one production stage has to occur in the country of origin.
Q2) In France, laws forbid the use of foreign words such as le weekend or le marketing in official documents.
A)True
B)False
Q3) Explain giving examples as to why "Jurisdiction" plays an important role in global marketing?
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Page 7
Chapter 6: Global Information Systems and Market Research
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Q1) By combining household information with weekly purchase behavior data, Tesco is able to tailor promotions to specific customer segments.
A)True
B)False
Q2) Campbell is the world's largest soup company, commanding about 80% of the U.S. canned soup market. However, the company has a presence in only 6% of the world's soup markets. Russians eat 32 billion servings of soup each year, and the Chinese consume 300 billion! By contrast, Americans eat 15 billion servings each year. Sensing a huge opportunity, Campbell has dispatched teams to observe Russian and Chinese habits. This type of interpretation and decision is based on:
A)demand pattern analysis.
B)income elastic analysis.
C)time series displacement.
D)polycentrism.
E)comparative analysis.
Q3) If Coach, a luxury goods marketer, would like to study the consumer perceptions of global luxury brands, what would be the best approach since there are several competitors?
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Chapter 7: Segmentation, Targeting, and Positioning
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Q1) When a marketer understands that a product satisfies a buyer's rational criteria while also evoking an emotional response, the marketer should:
A)only target consumers in high-income countries.
B)utilize a multi-tiered targeting strategy rather than a concentrated strategy.
C)commission psychographic segmentation studies to augment demographic data.
D)create advertising that reflects a bipolar, high-tech and high-touch approach.
E)follow normal targeting strategy.
Q2) The DMBB (D'arcy Massius Benton & Bowles)agency created a psychographic profile of the Russian market. The categories include all of the following except:
A)Kuptsy.
B)Cossacks.
C)Elites.
D)Students.
E)Business Executives.
Q3) After evaluating identified segments, decisions have to be made whether to pursue a particular opportunity or not. Assuming the decision is made to proceed, an appropriate targeting strategy must be developed. Explain the basic categories of target marketing strategies and how they can be implemented.
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Chapter 8: Importing, Exporting, and Sourcing
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Q1) China has imposed tariffs as high as 28% on foreign-made auto parts.
A)True
B)False
Q2) ________ are licensed specialists in traffic operations, customs clearance, and shipping tariffs and schedules. They can be considered as the travel agents for handling export goods.
A)Foreign purchasing agents
B)Export brokers
C)Export merchants
D)Freight forwarders
E)Cooperative exporters
Q3) ________ is sometimes called a mother hen, a piggyback exporter, or an export vendor
A)Export broker
B)Export merchant
C)Cooperative exporter
D)Export manager
E)Manufacturer's agent
Q4) Exporting is considered as essentially a developmental process. What are the stages in which this process can be divided?
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Chapter 9: Global Market Entry Strategies: Licensing, Investment, and Strategic Alliances
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Q1) By pursuing a joint venture entry strategy, a company can limit its financial risk as well as its exposure to political uncertainty.
A)True
B)False
Q2) One of the advantages of licensing is:
A)licensees have limited control.
B)licensees have considerable autonomy.
C)license agreements have short life.
D)licensees can develop similar products.
E)licensees have considerable leverage.
Q3) Franchising in a global market is actually a market-entry strategy that is typically executed with less localization than is licensing.
A)True
B)False
Q4) Joint ventures are becoming very popular as an entry mode into foreign markets. Why is this strategy so attractive to companies interested in entering other markets in the world?
Q5) Why would any firm, whether global or otherwise, seek to collaborate with another firm, be it local or foreign?
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Chapter 10: Brand and Product Decisions in Global Marketing
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Q1) Before executives at Ben & Jerry's Homemade launched their ice cream in the United Kingdom, the company conducted extensive research to determine whether the package design effectively communicated the brand's "super premium" position. This is an example of dual-extension strategy.
A)True
B)False
Q2) A global product meets the wants and needs of a global market, including the Triad which includes the following countries:
A)Brazil, Russia, and China.
B)Japan, Western Europe, and the United States.
C)China, the United States, and Europe.
D)China, India, and Brazil.
E)Japan, China, and Western Europe.
Q3) When Kraft Foods launched Oreo brand cookies in China in 1996, they found that Oreo was too sweet for the Chinese palate, and the price was too low. Oreo reformulated a less-sweet chocolate-covered wafer and increased its price. This strategy is referred to as product extension approach.
A)True
B)False
Page 12
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Chapter 11: Pricing Decisions
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Q1) A market ________ pricing strategy calls for setting price levels that are low enough to quickly build market share.
A)gray
B)skimming
C)penetration
D)holding
E)cost-based
Q2) A firm without much export experience uses the rigid cost-based pricing method.
Which of the following considerations is the exporter ignoring?
A)Is the price competitive in view of local market conditions?
B)Does the price reflect the product's quality?
C)Will authorities in export markets view the price as reasonable or exploitative?
D)Does the price take antidumping laws into consideration?
E)all of the above
Q3) Companies using "rigid cost-plus pricing" set prices with adjustments to reflect market conditions outside the home country.
A)True
B)False
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13
Chapter 12: Global Marketing Channels and Physical Distribution
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Q1) When British entrepreneur Richard Branson established the first Virgin Megastore in France, he invested a great deal of money to develop a retail space on the famous Champs-Elysées. Judging by the approach Branson used, he and his management team must have viewed France as:
A)culturally close and easy to enter.
B)culturally distant and easy to enter.
C)culturally close and difficult to enter.
D)culturally distant and difficult to enter.
E)culturally difficult and easy to enter.
Q2) Tesco made vigorous effort to penetrate the U.S. market.
A)True
B)False
Q3) "Containerization" refers to a company's:
A)designing attractive product packaging that will help a product "sell itself."
B)use of computer technology to keep a lid on ("contain")distribution costs.
C)use of refrigerated warehouses for perishable products.
D)use of standard-sized shipping boxes that can be transported in various ways.
E)method of shipment by using oval size steel containers to fit different commodities.
Q4) What are global retail categories? Describe these categories giving examples.
Page 14
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Chapter 13: Global Marketing Communications Decisions I:
Advertising and Public Relations
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Q1) When photographing a couple entering a restaurant or theater, women should be shown preceding the man in Germany and France.
A)True
B)False
Q2) Even in the face of such tough and growing competition, Adidas still enjoys high brand loyalty among older Europeans. The company recruits young people and pays them to wear Adidas shoes in public. This is an example of:
A)local advertising.
B)pattern advertising.
C)global advertising.
D)advocacy advertising.
E)image advertising.
Q3) Arabic ads contain more price information, and are more likely to include comparative appeals than U.S. ads.
A)True
B)False
Q4) Why is the "big idea" easier to illustrate than define? Explain the importance of big idea in advertising strategy.
Page 15
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Chapter 14: Global Marketing Communications Decisions 2:
Sales Promotion, Personal Selling, and Special Forms of Marketing Communication
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Q1) Host-country nationals may possess work habits or selling styles that do not mesh with those of the parent company.
A)True
B)False
Q2) Which of the following is not characteristic of direct marketing?
A)A marketer relinquishes control of product when it is turned over to channel intermediaries.
B)Advertising serves to generate an immediate inquiry or purchase.
C)Repetition is used in individual advertisements.
D)The customer perceives high risk.
E)Direct response advertising is used.
Q3) Social couponing is one of the hottest online sales promotion trends. It offers its followers deal-of-the-day coupons that are sponsored by local businesses.
A)True
B)False
Q4) What are the issues and problems related to sales promotion in different parts of the world?
Page 16
Q5) Giving examples, show how sampling can be an effective sales promotion technique.
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Page 17
Chapter 15: Global Marketing and the Digital Revolution
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Q1) According to Steve Case, founder of AOL, the second wave of the Internet revolution lasting from 2000 to 2014, shifted the focus from building the Internet to building on top of it.
A)True
B)False
Q2) Konbini refers to convenience stores where consumers can pay for online purchases in
A)Indonesia.
B)Russia.
C)Croatia.
D)Japan
E)Bosnia.
Q3) Web sites that provide news and entertainment and support a company's PR efforts are known as:
A)company sites.
B)transaction sites.
C)promotion sites.
D)content sites.
E)cyber sites.
Q4) Comment on the current status and future of "Wearable technology."
Page 18
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Chapter 16: Strategic Elements of Competitive Advantag
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Q1) Apple's success with the iPhone prompted Samsung and others to enter the market. This is an example of the "perfect competition."
A)True
B)False
Q2) In the terminology of the strategic intent framework for competitive advantage, a firm that establishes advantages in a number of different areas has:
A)attribute diversity.
B)marketing breadth.
C)comparative advantage.
D)layers of advantage.
E)a "double diamond."
Q3) Cost leadership is a sustainable source of competitive advantage only if no barriers exist that prevent competitors from achieving the same low costs.
A)True
B)False
Q4) What is hypercompetition? Briefly discuss conditions under which hypercompetition takes place.
Q5) How do chance events play a role in shaping the competitive environment?
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Chapter 17: Leadership, Organization, and Corporate Social Responsibility
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Q1) Nokia's reversal of fortune at the hands of Apple and Google underscores the fact that today's executives must rethink the concept of the corporation if they wish to operationalize the concept of core competencies.
A)True
B)False
Q2) Which global company has dissolved its matrix structure in order to achieve "greater speed and efficiency by further focusing and flattening the organization"?
A)Whirlpool
B)Levi Strauss
C)Pearson PLC
D)ABB
E)Gillette
Q3) In developing countries, globalization's opponents accuse companies of:
A)undermining local cultures.
B)placing intellectual property rights ahead of human rights.
C)promoting unhealthy diets and unsafe food technologies.
D)pursuing unsustainable consumption.
E)all of the above
Q4) What is a matrix organization? Describe giving examples.
Page 20
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