Marketing Chapter 8 & 9
product concept
A detailed version of the new product idea stated in meaningful consumer terms
A new product may fail for many reasons. Which of the following is NOT one of them? A. Overestimated market size B. Poor product design C. Poor product positioning D. Rapid market acceptance E. Poor marketing research
D
New product idea write ups include...
the product or the service, the proposed customer value proposition, the target market, and the competition.
New Product Development Process
An eight-phase process for introducing products: idea generation, screening, concept testing, market strategy and development, business analysis, product development, test-marketing, and commercialization
Marketers must consider external considerations in establishing pricing. Which of the following represents those external considerations? Demand, market strategy, and the effect of reseller actions B. Market strategy, environmental factors, and distribution channels C. Demand, revenue objectives, and stakeholder requirements D. The nature of the market and demand and other environmental factors E. The nature of the market and environmental factors
D
Which of the following pricing strategies would a company use to attract a large number of buyers quickly and win a large market share? A. Market-skimming pricing B. Optional-product pricing C. Captive-product pricing D. By-product pricing E. Market-penetration pricing
E When using a market-penetration pricing strategy, companies set a low initial price to penetrate the market quickly and deeply-to attract a large number of buyers quickly and win a large market share. The high sales volume results in falling costs, allowing companies to cut their prices even further.
A company sets a high price on a new product it introduces to maximize revenue from various market segments. Which new product pricing strategy is the company using?
Market Skimming pricing When using a market-skimming pricing strategy, companies set a high initial price to skim the maximum amount of revenue from the various segments of the market.
two ways a firm can obtain new products
1. Acquisition- by buying a whole company, a patent, or a license to produce someone else's product 2. New product development-
Companies have to think carefully when considering price changes. They must consider which of the following? A. Buyer and competitor reactions B. Management reactions C. Research and development reactions D. Investor reactions E. Sales and marketing reactions
A
Marketers must consider potential product issues related to social responsibility. Of the following, which is NOT one of the product issues associated with social responsibility? A. Product differentiation and positioning B. Product safety C. Patent protection D. Public policy issues and regulations E. Product warranties
A
All products have a life cycle. The sales of a typical product follow __________________, which is made up of five stages.
An S shaped curve
When companies treat customers fairly and make certain they understand pricing and pricing terms, this leads to ________________.
Building strong and lasting relationships w/ your customers
At which step does a company perform a review of the sales, costs, and profit projections for a new product to determine whether the new product is likely to satisfy objectives?
Business Analysis
Of the following, which is core element of our free-market economy? A. Price cuts B. Free trade C. Price competition D. Cost controls E. Uniform pricing regulations
C
Of the following, which is NOT one of the product-mix pricing situations? A. Captive-product pricing B. Optional-product pricing C. Product line pricing D. Penetration pricing E. Product bundle pricing
D
product line
a group of closely related product items
The Ford Mustang is offered in several different models. Ford uses __________ pricing to determine the price steps between the different models.
product line
What are the five product-mixing pricing situations
product line pricing, optional-product pricing, captive-product pricing, by-product pricing, and product bundle pricing.
product image
the way consumers perceive an actual or potential product
are the two ways firms can obtain new products.
Acquisitions and new product development
Product idea
An idea for a possible product that the company can see itself offering to the market.
Whats the most important source of new product ideas?
Customers
New product development consists of eight sequential steps. Which step reduces the number of ideas based on the company's criteria?
Idea Screening
Price discrimination is legal under which of the following conditions?
If a seller can prove its costs per unit are different when selling to different retailers.
RWW framework
Is it real? Can we win? Is it worth doing?
idea generation
The systematic search for new-product ideas - Internal through R&D & External through distributors and suppliers and even crowdsourcing
How do companies apply pricing strategies to accommodate differences in customer segments and situations?
They apply a variety of price adjustment strategies
Marketers use three major pricing strategies: ______________________.
Customer value-based pricing, cost-based pricing, and competition-based pricing
Which stage of the product life cycle normally lasts longer than the previous stages and poses strong challenges to marketing management?
Maturity
Tasks for concept development
To develop this new product into alternative product concepts, find out how attractive each concept is to customers, and choose the best one
Price ceilings are set by customer perception. Which of the following sets the floor for the price that a company charges?
Costs While customer value perceptions set the price ceiling, costs set the floor for the price that the company can charge. Cost-based pricing involves setting prices based on the costs of producing, distributing, and selling the product plus a fair rate of return for the company's effort and risk.
Idea Screening
Screening new product ideas to spot good ones and drop poor ones as soon as possible since development costs rise later. Want to go ahead with only profitable product ideas.
zone pricing
a modification of uniform delivered pricing that divides the United States (or the total market) into segments or zones and charges a flat freight rate to all customers in a given zone
Crowdsourcing
inviting broad communities of people - customers, employees, independent scientists and researchers, and even the public at large - into the new product innovation process
product stewards
job is to protect consumers from harm and the company from liability by proactively ferreting out potential product problems
A company's pricing strategy is affected by internal factors such as ___________________.
overall marketing strategy, objectives, marketing mix, and other organizational considerations
When sellers set prices in conjunction or collaboration with one another, this illegal practice is known as _______________.
price fixing
