MKTG 3310 Ch. 12

Product development entails a variety of processes and considerations to determine which aspects of a product or service?

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 different the product is from other offerings in the market How valuable the product is to the consumer

_____________ generation refers to the first stage in the process by which firms develop a new product.

Idea

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

Through innovation, firms often create a broader portfolio of products, which help them _________ and enhance firm value better than a single product.

diversify their risk

The _______ stage of the product life cycle is marked by a growing number of product adopters, and increases in both the number of competitors and the number of available product versions.

growth

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

Key characteristics of the introduction stage are that ______. (Select all that apply.)

start-up costs are high profits are low

When a company adds new products this helps the company to ______ its risk.

diversify

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- visual images

The product development process can be diagrammed as a sequential process. Put the stages in order

1) idea generation 2) concept testing 3)product development 4) market testing 5) product launch 6) evaluation of product's success

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%

Which of the following processes could be considered an acceptable method for generating ideas?

Conducting consumer research Brainstorming within the firm Researching competitors' products and services Communicating with a firm's R&D department

Which purchasing group represents about 13.5 percent of all buyers in the market and is crucial for bringing the other buyer categories to the market?

Early adopters

Few new products and services can be profitable until which large group of adopters buys them?

Early majority

Product development or product design entails a process of balancing which types of considerations?

Engineering Marketing Manufacturing

After a new product is launched, what is the next step of the product development process?

Evaluation of results

New products must be targeted toward end consumers.

False

If the same selection of books were always for sale, with no new titles, there would be no reason to buy more. This is an example of which reason firms must innovate?

Fashion cycles

__________ is the process by which ideas are transformed into new products and services that will help firms grow.

Innovation

__________ refers to the process by which ideas get transformed into new offerings, including products, services, processes, and branding concepts that will help firms grow.

Innovation

___________are buyers of a product or service who are the first ones to adopt it.

Innovators

Firms can measure the success of a new product, by asking three questions. Which of the following is NOT one of these questions?

Is the product already offered by competing firms?

Firms can highlight a product's relative advantage, which refers to which perception among consumers about the product?

It is better than its substitutes

What will happen to a firm if it continues to produce the same products in a saturated market?

It will eventually decline.

______ are consumers who like to avoid changes and rely on traditional products until they are no longer available.

Laggards

_______ tend to avoid change, rarely vary from traditional goods and services, and in some cases never attempt to adopt new types of products.

Laggards

_________ involves taking apart a product, analyzing it, and creating an improved product that does not infringe on the competitor's patents, if any exist.

Reverse engineering

What are the key characteristics of the growth stage of the product life cycle? (Select all that apply.)

Sales rise Competitors increase

Without innovation, what options would be available to firms?

Take current products to new markets Continue to market current products to current customers

______ defines the stages products move through as they enter, get established in, and ultimately leave the marketplace.

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

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

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

Adding new products is MOST likely to prompt consumers to purchase in which of the following industries?

Video games

Some markets demand a higher frequency of new product releases than others. In which of the following markets do sales come from new products?

Video games Books Movies

What does a postlaunch review help determine? (Select all that apply.)

Whether changes to the marketing mix are needed Whether the launch was a success or failure Whether additional resources are needed

Early ___________ , Incorrect Unavailable are the category of consumers who begin to use a product or service immediately following innovators.

adopters

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

In theory, the contour of the product life cycle is _______ with regard to sales and profits.

bell-shaped

During _______ potential consumers examine a product prototype in a real-use setting to determine its functionality, potential problems, and other issues specific to its use.

beta testing

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

Firms with products in the _______ stage either position themselves for a niche segment of diehard consumers or those with special needs, or they completely exit the market.

decline

Without new products or services, the values of the firm will ultimately _________.

decline

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 ______.

diffusion of innovation

The process by which the use of an innovation—whether a product, a service, or a process—spreads throughout a market group, over time and across various categories of adopters, is referred to as _______.

diffusion of innovation

the process by which the use of an innovation, whether a product or service, spreads throughout a market group over time and over various categories of adopters

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.

early adopters

In terms of their place on the diffusion of innovation curve, innovators are the ______ category of consumers.

first

The first step in the product development process is _______.

idea generation

Although there are numerous stages in the product development process, every firm starts to develop new products through ______ and then finishes with an evaluation of ______.

idea generation; results

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 ______.

improve business relationships

Buyers who love to try out new goods and services before the general public accepts them are referred to as _______.

innovators

The ________ stage of the product life cycle is characterized by initial losses to the firm due to high start-up costs and low levels of sales revenue as the product begins to take off.

introduction

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

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.

laggards

Those consumers who enter the market for the first time during the decline stage are known as ______.

laggards

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 innovation curve.

majority

During the ______ stage of the product life cycle, the market for the product usually becomes saturated.

maturity

In the United States, most consumer packaged goods found in grocery and discount stores are already in the _______ stage, which is characterized by the adoption of the product by the late majority and intense competition for market share among firms.

maturity

In order to accurately evaluate the new product launch, marketers must undertake a critical ______ review to determine whether the product and its launch were a success or failure.

postlaunch

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

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 ______.

saturated

In order to examine the potential success of its 1/3 pound Angus hamburger, McDonald's started offering and promoting the product in three southern cities. This move is an example of _________.

test marketing

When Burger King introduced the new Whopper Bar to a limited geographical area prior to a national launch, it was engaging in ______.

test marketing

When Subway introduced a new Southwestern Club sandwich in South Florida before launching it nationwide, it was engaging in ______.

test marketing

When a product is first launched during the introduction stage, sales are usually ______ and there are ______ competitors.

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 stage the product is in