MKT 300 Chapter 12
When Burger King introduced the new Whopper Bar to a limited geographical area prior to a national launch, it was engaging in ______. test marketing concept testing prototype testing a premarket test
test marketing
When a company adds new products this helps the company to ______ its risk. lower reduce diversify improve the trendiness
diversity
Laggards make up roughly ______ of the market.
16%
True or false: New products must be targeted toward end consumers.
False
_________________ is the process by which ideas are transformed into new products and services that will help firms grow.
Innovation
______________are buyers of a product or service who are the first ones to adopt it.
Innovators
Product development entails a variety of processes and considerations to determine which aspects of a product or service? Customers Sales potential Form and features Marketing strategy
form and features
_______________ generation refers to the first stage in the process by which firms develop a new product.
idea
The ________________ stage of the life cycle for a new product or service category usually starts with a single firm, and innovators are the ones to try the new offering.
introduction
Key characteristics of the introduction stage are that ______. (Select all that apply.) price competition is fierce start-up costs are high buyers are abundant profits are low sales are high
start-up costs are high profits are low
______________________ of innovation is the process by which the use of an innovation, whether a product or a service, spreads throughout a market group over time and over various categories of adopters.
Diffusion
A company that develops a new merchandise tracking technology that automatically notifies suppliers when a new shipment is needed is using its new product to ______. increase market share identify new target markets improve business relationships eliminate competition
improve business relationships
Which of the following processes could be considered an acceptable method for generating ideas? Arguing with other firms and institutions Brainstorming within the firm Researching competitors' products and services Conducting consumer research Communicating with a firm's R&D department
Brainstorming within the firm Researching competitors' products and services Conducting consumer research Communicating with a firm's R&D department
Adding new products is MOST likely to prompt consumers to purchase in which of the following industries? Video games Household appliances Oil and gas Writing utensils
Video games
True or false: If market testing returns with positive results, the firm is then ready to introduce the product to the entire market, which is called a product launch.
True
True or false: Managers can use the product life cycle model to help predict what pricing, product, promotional, and placement strategies they should employ at each of the four stages.
True
The ___________________ stage of the life cycle for a new product or service category usually starts with a single firm, and innovators are the ones to try the new offering.
introduction
The product development process can be diagrammed as a sequential process. Place the stages in order
1. Idea generation 2. concept testing 3. product development 4. market testing 5. product launch 6. Evaluation of results
The early majority represents approximately ______ of the total consumer market and is crucial to the profitability of a product or service. Without them, the product or service will typically fail.
34%
While late to the party, the late majority category of consumers is still significant, making up roughly ______ of the total consumer market.
34%
Some markets demand a higher frequency of new product releases than others. In which of the following markets do sales come from new products? Gardening equipment Books Over-the-counter medicines Movies Video games
Books Movies Video games
Which of the following processes could be considered an acceptable method for generating ideas? Brainstorming within the firm Conducting consumer research Researching competitors' products and services Communicating with a firm's R&D department Arguing with other firms and institutions
Brainstorming within the firm Conducting consumer research Researching competitors' products and services Communicating with a firm's R&D department
What are the key characteristics of the growth stage of the product life cycle? (Select all that apply.) Sales stabilize Typical consumers are innovators Competitors increase Sales rise
Competitors increase Sales rise
Without innovation, what options would be available to firms? Develop new products for current markets Continue to market current products to current customers Develop new products for new markets Take current products to new markets
Continue to market current products to current customers Take current products to new markets
After a new product is launched, what is the next step of the product development process? Pricing the product Concept testing Developing the advertising campaign Evaluation of results
Evaluation of results
What is a key characteristic of the maturity stage? Firms defend market share Adoption of the product by early majority High prices Few competitors in the market
Firms defend market share
Product development entails a variety of processes and considerations to determine which aspects of a product or service? Sales potential Marketing strategy Customers Form and features
Form and features
Which of the following factors influence how rapidly a product will move through the product life cycle? (Select all that apply.) How valuable the product is to the consumer How different the product is from other offerings in the market The size of the producing firm's R&D budget The average age of the target market
How valuable the product is to the consumer How different the product is from other offerings in the market
Which of the following factors influence how rapidly a product will move through the product life cycle? (Select all that apply.) The average age of the target market The size of the producing firm's R&D budget How valuable the product is to the consumer How different the product is from other offerings in the market
How valuable the product is to the consumer How different the product is from other offerings in the market
Firms can highlight a product's relative advantage, which refers to which perception among consumers about the product? It is better than its substitutes It is new and innovative It is less expensive than competitors It is the most popular item on the market
It is better than its substitutes
Firms can highlight a product's relative advantage, which refers to which perception among consumers about the product? It is better than its substitutes It is the most popular item on the market It is less expensive than competitors It is new and innovative
It is better than its substitutes
What will happen to a firm if it continues to produce the same products in a saturated market? Its revenues will stay the same. It will experience rapid growth. Its revenues will grow slowly. It will eventually decline.
It will eventually decline
______ are consumers who like to avoid changes and rely on traditional products until they are no longer available.
Laggards
Product development or product design entails a process of balancing which types of considerations? Manufacturing Marketing Distribution Engineering
Manufacturing Marketing Engineering
Product development or product design entails a process of balancing which types of considerations? Marketing Distribution Engineering Manufacturing
Marketing Engineering Manufacturing
______ defines the stages products move through as they enter, get established in, and ultimately leave the marketplace. Alpha and beta testing The product development process Diffusion of innovation The product life cycle
The product life cycle
What objective(s) do firms have in adding new products, services, and processes to their offerings? (Select all that apply.) To satisfy the changing needs of consumers To keep customers from getting bored with existing products To lower production costs To attract talented employees to the firm
To satisfy the changing needs of consumers To keep customers from getting bored with existing products
What does a postlaunch review help determine? (Select all that apply.) Whether competitors should be eliminated Whether new management should be hired Whether changes to the marketing mix are needed Whether additional resources are needed Whether the launch was a success or failure
Whether changes to the marketing mix are needed Whether additional resources are needed Whether the launch was a success or failure
Early ____________ are the category of consumers who begin to use a product or service immediately following innovators. (Remember to type only one word in each blank.)
adopters
New products and services that consumers accept quickly will have a high ______ rate early in their product life cycles, which will accelerate the diffusion process across the various stages. adoption success diffusion life cycle
adoption
The Apple iPod was readily accepted by consumers in part because it was an easy way to listen to music anywhere, with substantial improvements over portable CD players. This is an example of a relative ___________________ within the diffusion process.
advantage
Firms need to continue to innovate because customer needs ______. are constantly changing tend to stay constant over time are insignificant compared to the need to always use the newest technologies can be disregarded once a product is established in the market
are constantly changing
A ______________ is a written description of a product and its technology and is presented to potential buyers or users to obtain their reactions.
concept
A __________is a written description of a product and its technology and is presented to potential buyers or users to obtain their reactions.
concept
A concept can be as simple as a brief written description of the product that might also include ______. (Select all that apply.) customer needs it satisfies the final product ideas generated visual images
customer needs it satisfies visual images
The process by which the use of an innovation, whether it be a product or service, is spread throughout a market group over time and over various categories of adopters, is known as ______. distribution of product inventory viral marketing the product life cycle diffusion of innovation
diffusion of innovation
Along the diffusion of innovation curve, _______ make up the second group of consumers to adopt an innovation; they tend to be leaders in a social setting. first movers pioneers early majority early adopters innovators
early adopters
In terms of their place on the diffusion of innovation curve, innovators are the ______ category of consumers. majority third and fourth second first
first
Product development entails a variety of processes and considerations to determine which aspects of a product or service? Sales potential Customers Marketing strategy Form and features
forms and features
Usually, during the ____________ stage of the product life cycle, the typical consumers are early adopters, and there are increases in the number of competitors.
growth
During the decline stage of the product life cycle, ______ who have not yet tried the product or service will be entering the market for the first time. early adopters innovators laggards marketers
laggards
Those consumers who enter the market for the first time during the decline stage are known as ______.
laggards
Those consumers who enter the market for the first time during the decline stage are known as ______. innovators late adopters late majority laggards
laggards
When the ________________ majority of consumers enters the market, the market has already reached its full market potential.
late
When the _________________ majority of consumers enters the market, the market has already reached its full market potential.
late
A good or service may pass through many stages as it establishes itself in the marketplace. Marketing managers refer to this as the product _________________ cycle.
life
The early _______________ represents the earlier half of the two largest categories of consumers on the diffusion of innovation curve.
majority
During the ______ stage of the product life cycle, the market for the product usually becomes saturated.
maturity
During the _________ stage of the product life cycle, the market for the product usually becomes saturated.
maturity
If a firm has a positive result from the market testing the next step is known as _______________ launch.
product
One advantage of product innovation is that a firm can expand into different product categories. The point of the ______ strategy is that if some products in one category are competing poorly, others in another category could be doing very well. risk diversification risk assimilation risk transfer risk seeking
risk diversification
New product and service innovation is important because the longer a product or service exists in a given marketplace, the more likely that the market will become ______. integrated saturated profitable vacant
saturated
New product and service innovation is important because the longer a product or service exists in a given marketplace, the more likely that the market will become ______. profitable saturated vacant integrated
saturated
When firms decide to develop new products, it is typically a long process that is broken into ______ stages.
six
Key characteristics of the introduction stage are that ______. (Select all that apply.) buyers are abundant price competition is fierce start-up costs are high profits are low sales are high
start-up costs are high profits are low
When Subway introduced a new Southwestern Club sandwich in South Florida before launching it nationwide, it was engaging in ______.
test marketing
Which of the following is a market testing method that offers a strong predictor of product success based on actual purchasing behavior? Simulated shopping Focus grouping Brainstorming Test marketing
test marketing
When a product is first launched during the introduction stage, sales are usually ______ and there are ______ competitors. high; numerous very low; essentially no profitable; no unprofitable; several
very low; essentially no
The problem with using the product life cycle concept is that no one can predict the shape that the product's life cycle will take; therefore, it is impossible to know ______. which group of consumers like the product if the cost of the product is accurate if more prototypes would be beneficial which stage the product is in
which stage the product is in
