Chapter 14

List the six steps in the new product development process, starting with the first step at the top and ending with the last.

1. Idea generation 2. Product screening 3. Product Analysis 4. Development 5. Testing 6. Commercialization

Pricing based on the pricing activities of other companies in relation to a product is called

Competition based pricing

will ultimately determine the price of goods.

The market

When a firm prices a new product very high to make optimum profit while there is little competition, it is said to be using:

skimming price strategy

Designing a product so that it satisfies customers and meets the profit margins desired by firms is called:

target costing

Direct responsibility for all aspects of a product line or a brand including the marketing mix is the role of the

Brand manager

person responsible for one brand or product line is called a

Brand manager

The name of the pricing strategy that sets the price at, above, or below the price of competitors is

Competition based pricing

A product that could be both a consumer product or industrial product depending on its use is a:

Computer

A product the consumer wants to purchase frequently and with minimum effort is a good or service called a(n):

Convenience goods

Candy, gum, milk, snacks, and gas are all examples of

Convenience goods

An increase in outsourcing and alliance building has resulted in____________product development that often includes coordinating with companies in other countries.

Distributed

Handing off various parts of a firm's innovation process, sometimes to companies in other countries, is called

Distributed product development

Packaging serves several critical functions in the overall success of a product. Some of these functions are

Explaining the benefits of what's inside Giving a potential buyer a sense of price, value, and uses. Attracting the buyer's attention

Not delivering what is promised is a leading cause of new-product

Failure

True or false: Distributed product development is producing a firm's product without the help of other organizations.

False

True or false: Grouping two or more products together and pricing them as a unit is called stacking.

False

True or false: It takes dozens of ideas to generate one commercial product.

False

True or false: Ultimately, producers determine the price of a product.

False

Sellers are now able to commercialize new products more quickly online and through social media that enable them to reach

Global markets

Xerox, Kodak, Sony, and Dell are all examples of ____ brand names.

Manufacturers

A brand manager manages all elements of a product line or the brand's

Marketing mix

In which stage of a product's life cycle would marketers find the need to communicate what makes its product different from others products?

Maturity

competition does not use price as a major promotional appeal, but instead stresses consumer benefits and product style.

Nonprice

one of the most difficult of the four Ps for a manager to control, since it directly relates to the consumer perceptions of the value of a product.

Price

Demand-based pricing is based on what customers are willing to pay for a product due to its perceived value, not the

Price of producing it

ChoiceDevelops cost estimates and sales forecasts to determine profitability

Product analysis

Which step in the new product development process involves estimating costs and sales to get a feel for the new products potential profitability.

Product analysis

ChoiceReduces the number of products a company is working on down to the most promising

Product screening

Reducing the number of new product ideas based on specific criteria is a function of product ___________whereas determining the profitability of those ideas is a function of product ____________

Screening, analysis

Blank______ is a pricing strategy that aims to design a product so that it satisfies customers and meets the profit margins for a company.

Target costing

When opening a bag of potato chips the bag is much larger than what is inside. The reason for this most likely has to do with which function of packaging.

To protect the goods inside

True or false: The two categories of Goods and Service that take more effort on the part of consumers are Shopping and Specialty

True

What is an example of a manufacturer's brand name?

Xerox

A major reason why many new products fail is that they:

are too similar to competitors

A name, symbol, or design that identifies the goods or services of one seller or group of sellers is called a:

brand

The value of the brand name and associated symbols is referred to as

brand equity

The point where revenues from sales equal all costs is called the:

break-even point

Grouping two or more products together and pricing them as a unit is called:

bundling

When consumers look at all of the benefits of a product and subtract all of the costs related to its purchase, they are:

calculating the value of the product

Product differentiation is used to Blank______.

call attention to product differences that appeal to the preferences of the target market

Examples of convenience goods are:

candy, gum, milk, and gas

Setting price at, above, or below competitors based on what they are doing is a pricing strategy called:

competition-based pricing

Consumers calculate the value of a product by:

considering whether all of the benefits exceed all of the costs

The pricing strategy in use when a firm prices products based on consumer demand is called:

demand-oriented

When airlines charge higher prices for seats in the Economy section Exit rows that have more leg room, they are using which pricing strategy?

demand-oriented

Handing off various parts of a firm's innovation process sometimes to companies in other countries is called _____________ product development.

distributed

During the growth stage of the product life cycle, sales and profits mostly

increase

New products are getting rapid exposure to global markets through:

internet

The stages of the product life cycle are:

introduction, growth, maturity, decline

In the long run, price is determined by the:

market

Recognizing what stage of its life cycle a product is in has a direct impact on marketers' decisions about:

marketing mix

In which stage of a product's life cycle would marketers find the need to communicate what makes its product different from others products?

maturity

Marketers who seek to differentiate their products by promoting attributes such as safety or the brand name are using:

nonprice competition

It is unusual for a company to sell:

one product

The reasons why many new products fail include:

poor packaging too few differences from competitors poor positioning

Which of the four Ps below is the most difficult for a manager to control due to the impact it has on consumer evaluation of an offering?

price

The pricing strategy that calls for a new product being priced high to make optimum profit while there is little competition is called a(n)

price skimming

The creation of real or perceived product differences is called:

product differentiation

Companies rarely sell one product, but offer a

product line

During _____, a marketing manager should use such criteria as fit with the firm's other products, profit potential, and marketability.

product screening

Justifying a new product's fit, profit potential, and marketability is known as:

product screening