Management and Organizational Studies 2275A/B Study Guide - Bid Rigging, Multi-Level Marketing, Predatory Pricing

23 views17 pages
Page:
of 17
PART 7: SALES AND MARKETING
CHAPTER 24
SALES & MARKETING: PRICE, DISTRIBUTION, &
RISK MANAGEMENT
Objectives
After studying this chapter, you should have an understanding of:
the legal obligations associated with the price component of marketing
the legal obligations associated with the distribution (place) component of marketing
the role of risk management and corporate compliance in marketing
Learning Outcomes
Understand the purpose of regulation of price in the market (page 615)
Understand the pricing practices that are prohibited (page 616)
Understand the distribution practices that are prohibited (page 622)
The role of risk management and corporate compliance in marketing (page 629)
Chapter Summary
Price and distribution are two of the components of the marketing mix. Price includes more
than the provisions designed to protect consumers. There is also strong public interest in
ensuring that businesses compete fairly. If unfair practices are permitted, honest businesses
will find themselves at a competitive disadvantage or will be squeezed out of the
marketplace. While it is perhaps a common perception that anything goes in competition
between businesses, the regulations outlined in this chapter related to business-to-business
dealings show that this assumption is incorrect. Laws have evolved to address some of the
issues that are of particular concern to Canadians, given the size of this country and its
relatively small population. Businesses may have to become dominant in the marketplace to
achieve economies of scale. Nonetheless, such market dominance cannot be allowed to lead
to unfair or discriminatory practices. Distribution covers a range of activities and practices.
Distribution practices that discriminate between customers and thereby substantially reduce
competition are reviewable by the Competition Bureau. Direct-marketing practices are
regulated both provincially and federally. Risk management in marketing entails paying
close attention to all aspects of a marketing plan to identify risks relating to the business and
its customers. A plan should set clear guidelines for staff and ensure awareness of marketing
activities that are not permitted. A corporate compliance program is a critical factor in any
investigation by the Competition Bureau. More importantly, its positions the business so that
compliance with all legislation is a fundamental principle by which it operates.
Copyright © 2011 by Nelson Education Ltd.
PART 7: SALES AND MARKETING
Study Outline
Use this outline to prepare a complete set of notes for this chapter.
Price – page 615
_______________________________________________________________________
_______________________________________________________________________
Pricing practices between producer and commercial purchaser_____________________
_______________________________________________________________________
Pricing conspiracies____________________________________________________
_______________________________________________________________________
Bid rigging___________________________________________________________
Abuse of dominant position_________________________________________________
_______________________________________________________________________
Price discrimination____________________________________________________
_______________________________________________________________________
Predatory pricing______________________________________________________
Price maintenance_____________________________________________________
Pricing practices between seller and consumer_______________________________
_______________________________________________________________________
Sale or bargain prices___________________________________________________
Sale above advertised prices________________________________________________
Double ticketing_______________________________________________________
Distribution – page 622
_______________________________________________________________________
_______________________________________________________________________
Organizational structure____________________________________________________
_______________________________________________________________________
Mergers, acquisitions, and takeovers_______________________________________
Multilevel marketing___________________________________________________
Pyramid selling_______________________________________________________
Discriminatory distribution practices__________________________________________
Refusal to deal________________________________________________________
Exclusive dealing______________________________________________________
Tied selling___________________________________________________________
Anticompetitive behaviour__________________________________________________
Direct marketing_________________________________________________________
Door-to-door selling____________________________________________________
Copyright © 2011 by Nelson Education Ltd.
CHAPTER 24: SALES & MARKETING: PRICE, DISTRIBUTION, & RISK MANAGEMENT
Telemarketing________________________________________________________
Online retailing_______________________________________________________
Risk Management in Marketing – page 629
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
SELF-ASSESSMENT
Key Terms
Briefly define each term in the space provided.
Abuse of dominant position – page 617
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
Price discrimination – page 618
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
Predatory pricing – page 618
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
Price maintenance – page 618
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
Bid rigging – page 617
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
Double ticketing – page 620
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
134