interactive student edition Lois Schneider Farese Grady Kimbrell Carl A. Woloszyk, Ph.D. Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved. Except as permitted under the United States Copyright Act, no part of this publication may be reproduced or distributed in any form by any means, or stored in a database or retrieval system, without prior written permission of the publisher. Printed in the United States of America. Send all inquiries to: Glencoe/McGraw-Hill 21600 Oxnard Street, Suite 500 Woodland Hills, CA 91367 ISBN 0-07-861257-8 (Student Edition) ISBN 0-07-868914-7 (Teacher Wraparound Edition) 2 3 4 5 6 7 8 9 079 10 09 08 07 06 05 About the Authors Lois Schneider Farese is a nationally recognized secondary marketing educator and DECA advisor from New Jersey. She has been involved in organizing and running New Jersey regional and state DECA conferences and has also participated as series director and event manager at state and national DECA conferences. The State Officer Action Team presented Farese with the Outstanding Service Award for her dedication, professionalism, and commitment to New Jersey DECA in 1993, 1996, and 1999, as well as with the Honorary Life Membership Award in 1990 for setting a new level of professionalism for local advisors. She was inducted into the DECA Hall of Fame in 1996. Farese was named “Teacher of the Year” in 1981 by the Marketing Education Association of New Jersey. In 1993 and 1999, the University of Richmond recognized Farese for her contribu- tions to the intellectual growth and achievement of students who graduated from her marketing program. In 2000, Farese was the nominee from Northern Highlands Regional High School for the Princeton Prize for Distinguished Secondary School Teaching. Farese holds a bachelor’s degree in business and distributive education and two master’s de- grees from Montclair State University in New Jersey. Grady Kimbrell, a nationally recognized author and consultant on career education, began his career in education teaching high school business in Kansas. After relocating to Southern California, Kimbrell taught business courses and coordinated students’ in-class activities with their on-the-job experience. He later directed the work experience program for the high schools of Santa Barbara, California. A pioneer in the use of computers as a tool for educational research, Kimbrell has assisted school districts with a wide variety of research and evaluation activities. His research into on- the-job work activities led to the development of a new type of career interest inventory used in career guidance. In addition, Kimbrell has served on numerous state instructional program committees and writing teams, designed educational computer programs, and produced educa- tional films. Kimbrell holds degrees in business administration, educational psychology, and business education. Carl A. Woloszyk is a professor emeritus from Western Michigan University with an extensive background in marketing education. He has served as a state department of education consultant for marketing and cooperative education, DECA and Delta Epsilon Chi state advisor, a career and technical administrator for a regional education service agency, and a secondary marketing teacher-coordinator. As a secondary marketing teacher-coordinator, he taught beginning and advanced marketing courses. His students have received numerous awards at district, state, and national DECA conferences. Woloszyk has served on the board of directors for DECA; he has been president of the Marketing Education Foundation and of the Cooperative Work Experience Education Association of ACTE. He is a board member of the Michigan Marketing Educators’ Association. He has received the Marketing Education Professional Award from the national Marketing Education Association for Exemplary Service to Marketing Education. Woloszyk holds a master’s degree from Eastern Michigan University and an educational specialist degree in occupational education from the University of Michigan. He received his doctorate in business and distributive education from Michigan State University. iii Dennis Bristow Professor of Marketing St. Cloud State University St. Cloud, Minnesota Monica Caillouet East Ascension High School Gonzales, Louisiana Deborah Deacon Stoneham High School Stoneham, Massachusetts Jennifer Killingsworth West Hall High School Oakwood, Georgia Liberty A. Lacy Woodland High School Woodland, Washington Atkins D. Trey Michael, III Marketing Education Consultant North Carolina Department of Public Instruction Tom Scharine Oregon High School Oregon, Wisconsin Michael T. Seltzer Oxford Academy Cypress, California James W. Todd Mac Arthur High School San Antonio, Texas Michelle Totra Lindbergh High School St. Louis, Missouri Dana Young Yuma High School Yuma, Colorado Reviewers iv Contributing Writer Priscilla McCalla Professional and Program Development Director DECA Reston, Virginia v The World of Marketing xxvi CHAPTER 1 Marketing Is All Around Us. . . . 2 DECA Connection . . . . . . . . . . . . . . . . . 3 Section 1.1 Marketing and the Marketing Concept . . . . . . . . 4 Section 1.2 The Importance of Marketing . . . . . . . . . . . . . . 8 Section 1.3 Fundamentals of Marketing . . . . . . . . . . . . . . 12 Case Study: Pay As You Go Phone 18 Artist Development. . . . . . . . . . . . . . . 20 Chapter 1 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 DECA Connection . . . . . . . . . . . . . . . . 23 CHAPTER 2 The Marketing Plan. . . . . . . . . . . 24 DECA Connection . . . . . . . . . . . . . . . . 25 Section 2.1 Marketing Planning . . . . . . . . . . . . . . . . . . . 26 Case Study: Amazon.com . . . . . . . 28 Section 2.2 Market Segmentation . . . . . . . . . . . . . . . . . . 37 Marketing Coordinator. . . . . . . . . . . . 42 Chapter 2 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 DECA Connection . . . . . . . . . . . . . . . . 45 Conducting a SWOT Analysis for NASCAR . . . . . . . . . . . . . . . . . . . . . 46 Economics 48 CHAPTER 3 Political and Economic Analysis . . . . . . . . . . . . . . . . . . . . . . . . . 50 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 Section 3.1 What Is an Economy? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 Case Study: Transforming an Economic System . . . . . . . . . . . . . . . . . . 58 Section 3.2 Understanding the Economy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Internet Marketing Consultant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 Chapter 3 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 vi CHAPTER 4 Global Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 Section 4.1 International Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74 Case Study: The New Calcutta. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78 Section 4.2 The Global Marketplace . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 Senior Account Executive. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90 Chapter 4 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93 Conduct a Global Environmental Scan . . . . . . . . . . . . . . . . . . . . . . . . . 94 Business and Society 96 CHAPTER 5 The Free Enterprise System. . 98 DECA Connection . . . . . . . . . . . . . . . . 99 Section 5.1 Market-Oriented Economic Systems . . . . . . . 100 Section 5.2 Business Opportunities. . . . . . . . . . . . . . . . 109 Case Study: Entrepreneurship and Science . . . . . . . . . . . . . . . . 112 Director, Hispanic Council, Direct Marketing Association . . 118 Chapter 5 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119 DECA Connection . . . . . . . . . . . . . . . 121 CHAPTER 6 Legal and Ethical Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123 Section 6.1 Government and Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124 Case Study: Emissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130 Section 6.2 Social Responsibility and Ethics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133 Director, Litigation and Investigative Services . . . . . . . . . . . . . . . . . 142 Chapter 6 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145 Write a Proposal for a Civic-Minded Project . . . . . . . . . . . . . . . . . . . 146 vii Skills for Marketing 148 CHAPTER 7 Basic Math Skills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151 Section 7.1 Math Fundamentals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 152 Case Study: Selling Music and Style . . . . . . . . . . . . . . . . . . . . . . . . . . 160 Section 7.2 Interpreting Numbers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162 Certified Public Accountant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172 Chapter 7 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175 CHAPTER 8 Communication Skills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177 Section 8.1 Defining Communication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178 Section 8.2 Elements of Speech and Writing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 184 Case Study: Talking About Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 186 Account Executive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 192 Chapter 8 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 195 CHAPTER 9 Technology Applications for Marketing . . . . . . . . . . . . . . . . 196 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197 Section 9.1 Computer Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 198 Case Study: Online Radio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203 Section 9.2 Computer Technology and Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 205 Senior Software Analyst . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 212 Chapter 9 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215 viii CHAPTER 10 Interpersonal Skills. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 216 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217 Section 10.1 Personal Strengths and Interpersonal Skills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 218 Case Study: Coming to an Agreement. . . . . . . . . . . . . . . . . . . . . . . . . 223 Section 10.2 Working Together: Leadership and Teamwork . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225 Business Owner, Technology Sales and Services . . . . . . . . . . . . . . . 230 Chapter 10 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 231 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 233 CHAPTER 11 Management Skills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 234 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 235 Section 11.1 Management Structures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 236 Section 11.2 Management Functions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 240 Case Study: Always Making It Better . . . . . . . . . . . . . . . . . . . . . . . . . . 243 Music Director, Operations Manager . . . . . . . . . . . . . . . . . . . . . . . . . . 250 Chapter 11 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253 Design a Program for Savvy Business Travelers . . . . . . . . . . . . . . . 254 Selling 256 CHAPTER 12 Preparing for the Sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 258 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 259 Section 12.1 What Is Selling?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260 Section 12.2 Getting Ready to Sell. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265 Case Study: Marketing Pharmaceuticals . . . . . . . . . . . . . . . . . . . . . . . 266 Underwriting Sales, Public Radio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 272 Chapter 12 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 273 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 275 ix CHAPTER 13 Initiating the Sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 276 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 277 Section 13.1 The Sales Process. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 278 Case Study: Beware of Bias. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 280 Section 13.2 Determining Needs In Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 283 Founder, 1214 Enterprises, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 288 Chapter 13 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 289 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 291 CHAPTER 14 Presenting the Product . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 292 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293 Section 14.1 Product Presentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 294 Section 14.2 Objections. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 301 Case Study: Overcoming the Price Objection . . . . . . . . . . . . . . . . . . . 306 Commercial Photographer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 308 Chapter 14 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 309 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 311 CHAPTER 15 Closing the Sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 312 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 313 Section 15.1 How to Close a Sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 314 Case Study: The Electronic Close. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 316 Section 15.2 Customer Satisfaction and Retention. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 320 Sales Representative, Business Printing . . . . . . . . . . . . . . . . . . . . . . 328 Chapter 15 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 329 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 331 x CHAPTER 16 Using Math in Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 332 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 333 Section 16.1 Sales Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334 Case Study: Safety in Internet Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . 338 Section 16.2 Cash Registers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 342 Section 16.3 Purchase Orders, Invoices, and Shipping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 348 Customer Service Manager, Stagepass.com. . . . . . . . . . . . . . . . . . . 352 Chapter 16 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 353 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 355 Selling: Lid Rock Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 356 Promotion 358 CHAPTER 17 Promotional Concepts and Strategies . . . . . . . . . . . . . . . . . 360 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 361 Section 17.1 Promotion and Promotional Mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362 Section 17.2 Types of Promotion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369 Case Study: Plastic That Pays Back . . . . . . . . . . . . . . . . . . . . . . . . . . . 374 Manager Corporate Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 376 Chapter 17 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 377 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 379 CHAPTER 18 Visual Merchandising and Display . . . . . . . . . . . . . . . . . . . . . 380 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 381 Section 18.1 Display Features . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 382 Section 18.2 Artistic Design. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 388 Case Study: The Shopping Buddy . . . . . . . . . . . . . . . . . . . . . . . . . . . . 391 Architect, Architecture and Interior Design. . . . . . . . . . . . . . . . . . . . 394 Chapter 18 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 395 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 397 xi CHAPTER 19 Advertising . . . . . . . . . . . . . . . . . . . 398 DECA Connection . . . . . . . . . . . . . . . 399 Section 19.1 Advertising Media . . . . . . . . . . . . . . . . . . . 400 Section 19.2 Media Measurement and Rates. . . . . . . . . . . 409 Case Study: Generating New Revenue . . . . . . . . . . . . . . . . . . 413 Partner, Hispanic Division, Wizard of Ads, Inc. . . . . . . . . . . . . 416 Chapter 19 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . 417 DECA Connection . . . . . . . . . . . . . . . 419 CHAPTER 20 Print Advertisements . . . . . . . . 420 DECA Connection . . . . . . . . . . . . . . . 421 Section 20.1 Essential Elements of Advertising . . . . . . . . . 422 Section 20.2 Advertising Layout . . . . . . . . . . . . . . . . . . . 429 Case Study: Advertising to Reach Young Males . . . . . . . . . . . . . . . 432 Copywriter. . . . . . . . . . . . . . . . . . . . . . 434 Chapter 20 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . 435 DECA Connection . . . . . . . . . . . . . . . 437 Pitch a New Client . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 438 Distribution 440 CHAPTER 21 Channels of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443 Section 21.1 Distribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 444 Case Study: Changing Channels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 449 Section 21.2 Distribution Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 454 Business Owner, Fusionist.com. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 458 Chapter 21 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 459 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 461 xii CHAPTER 22 Physical Distribution . . . . . . . . 462 DECA Connection . . . . . . . . . . . . . . . 463 Section 22.1 Transportation Systems and Services. . . . . . . 464 Section 22.2 Inventory Storage. . . . . . . . . . . . . . . . . . . . 472 Case Study: Trucking and Wireless Technology. . . . . . . . . 474 Business Owner, Music Mail Order. . . . . . . . . . . . . . . . . . . . . . . . . 476 Chapter 22 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . 477 DECA Connection . . . . . . . . . . . . . . . 479 CHAPTER 23 Purchasing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 480 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481 Section 23.1 The Role of the Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 482 Case Study: Maximizing Purchasing Power . . . . . . . . . . . . . . . . . . . . 484 Section 23.2 The Purchasing Function . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 490 Business Owner, Furniture Lighting and Accessories . . . . . . . . . . . 496 Chapter 23 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 497 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 499 CHAPTER 24 Stock Handling and Inventory Control . . . . . . . . . . . . . . . . . 500 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 501 Section 24.1 The Stock Handling Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 502 Section 24.2 Inventory Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 508 Case Study: Bar Codes Meet New Standards . . . . . . . . . . . . . . . . . . . . 511 Business Systems Analyst . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 516 Chapter 24 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 517 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 519 Sell GPS Technology to Consumers. . . . . . . . . . . . . . . . . . . . . . . . . . . 520 xiii Pricing 522 CHAPTER 25 Price Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 524 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 525 Section 25.1 Price Planning Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 526 Section 25.2 Factors Involved in Price Planning. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 531 Case Study: 99 Cents Only: Spending in Order to Earn . . . . . . . . . . . 532 Pricing Consultant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 538 Chapter 25 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 539 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 541 CHAPTER 26 Pricing Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 542 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 543 Section 26.1 Basic Pricing Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 544 Case Study: Voice Over Internet Protocol . . . . . . . . . . . . . . . . . . . . . . 547 Section 26.2 Strategies in the Pricing Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 552 Business Co-Owner, Vegan Essentials. . . . . . . . . . . . . . . . . . . . . . . . . 560 Chapter 26 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 561 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 563 CHAPTER 27 Pricing Math . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 564 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 565 Section 27.1 Calculating Prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 566 Case Study: The Vuitton Money Machine. . . . . . . . . . . . . . . . . . . . . . 572 Section 27.2 Calculating Discounts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 577 Pricing Consultant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 582 Chapter 27 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 583 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 585 Pricing Toys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 586 xiv Marketing Information Management 588 CHAPTER 28 Marketing Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 590 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 591 Section 28.1 Marketing Information Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 592 Section 28.2 Types, Trends, and Limitations of Marketing Research. . . . . . . . . . . . . . . . . . . . . . . . 596 Case Study: Ad Agency Launches a Video Game Unit . . . . . . . . . . . . 600 Senior Research Analyst . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 604 Chapter 28 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 605 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 607 CHAPTER 29 Conducting Marketing Research . . . . . . . . . . . . . . . . . . . . . . . 608 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 609 Section 29.1 The Marketing Research Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 610 Section 29.2 The Marketing Survey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 618 Case Study: Re-Inventing the Potato. . . . . . . . . . . . . . . . . . . . . . . . . . 621 Director of Marketing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 624 Chapter 29 Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 625 DECA Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 627 Research Male Grooming Products. . . . . . . . . . . . . . . . . . . . . . . . . . . 628