BAS 282: New Product Development: SmartBook

Early majority adopters are likely to ______.

adopt a product once several competitors have entered the market, so they will have some choice as to which product to buy

In order to tell where a product is in the product life cycle, firms ______.

compare sales figures to prior sales and overall industry sales

During the product development stage of the new product development process, firms often ask consumers for their reactions to a ______, which consists of rough visual models or verbal descriptions of the product. Firms may also show consumers a ______, which is a mock-up of the product generally made from the same materials that will be used to make the final product.

concept test; prototype

In the new product development stage, a company is most likely to ______.

outline the general characteristics of the types of products the firm will develop

Laggards constitute approximately what percentage of the adopters of a new product?

16%

Select the two traits of all new products.

* They are functionally different from existing products on the market. * They are not marketed in their current form by the company.

What is the first stage in the new product development process?

New product strategy development

What is the final stage of the new product development process?

The product launch

Why do companies use product line extensions?

To combat low seasonal sales of existing products

The firm evaluates ideas to determine whether they fit into the new product strategy during the ______ stage.

idea screening

The four stages that a product eventually goes through are known collectively as the product ______.

life cycle

One characteristic of new category entry products is that they ______.

open up new sets of customers to firms

The most common new product development ethical issue involves ______.

the Federal Trade Commission's definition of "new"

Innovators constitute approximately what percentage of the adopters of a new product?

2.5%

Which of these statements about test marketing is true?

During test marketing, a product is introduced to a market that is geographically limited.

People in which group of adopters are usually highly respected by their peers and tend to be opinion leaders who are willing to talk to other people about their experiences with their purchases?

Early adopters

What stage in the new product development process takes place immediately after new product strategy development?

Idea generation

Which stage of the new product development process involves completing all the final preparations for making the fully tested product available to the market?

Product launch

In the order in which they adopt a product, with the earliest adopters first and the latest adopters last, adopters are classified as innovators, early adopters, early majority, late majority, and __________.

laggards

Which of these product categories tends to have the shortest life cycle?

Computer technology

Companies select test market locations based on ______.

how well they mirror the overall target market in terms of demographics, income levels, lifestyles, and other factors

When a product is revamped, it ______.

is often labeled as being new and improved

Several product characteristics impact a product's ______, or the process of the adoption and spread of a product. For example, a product that ______ will generally be adopted more quickly than one that does not.

diffusion; matches customers' values

Developing new or updated products in order to maintain or advance a product's market position and meet changing consumer demands is known as ______.

innovation

The creation of a new or significantly improved product offering is known as ______.

innovation

People who are driven to buy new products as soon as they are available, regardless of whether they are expensive or unproven, are known as ______.

innovators

Select all of the statements that are true about firms' use of consumer data in innovation.

* Firms use CRM systems to help identify consumer groups who might be interested in collaborating on new product development. * Firms monitor feedback from noncustomers to determine why they have not adopted the firm's products.

What types of information do marketers typically use to estimate the length of a product's life cycle? More than one answer may be correct.

* Product Type * The history of similar products.

The first stage in the new product development process is new product strategy development. Place the remaining six stages in order, with the first at the top and the last at the bottom.

1. Idea Generation 2. Idea Screening 3. Business Analysis 4. Product Development 5. Test Marketing 6. Product Launch

Which statement most accurately defines all new products?

A new product is one that is new to a company in any way.

During which stage of product development does a company estimate costs, identify pricing, and evaluate demand for the product in order to determine profitability?

Business analysis

During the product development stage, marketers seek to elicit consumer reactions about a new product. Firms will frequently use ______, which feature rough visual models and verbal descriptions of the product.

concept tests

The fourth stage of the product life cycle (PLC) is ______.

decline

The goal of a business analysis is to ______.

determine if a new product will be profitable enough to support its development

Marketers are more likely to successfully launch and sustain new products if they understand ______, which is how new products are likely to be adopted, the rate of their adoption, and how they will spread into markets.

diffusion

The process by which a product is adopted and spreads across various types of adopters is called ___________.

diffusion

The process of ______ involves coming up with a set of product concepts from which to identify potentially viable new products.

idea generation

When new product ideas come from a company's employees, it is known as __________ idea generation.

internal

The third stage of the product life cycle (PLC) is ______.

maturity

Although they make up the smallest percentage of new products, ______ products provide innovative benefits that often render existing products obsolete.

new-to-the-market

Product adopters known as laggards are likely to ______.

pay little attention to promotional activities

When a firm frequently comes out with new models of a product and its existing models become outmoded, the firm is engaging in ______.

planned obsolescence

From the following list, select all the choices that explain how firms use data to reduce the risks of new product launches.

* By collecting test market data on a new product and evaluating it against benchmark data * By using data to clearly identify who the product is for

From the following list, select the five characteristics that impact product adoption rate.

* Competitive Advantage * Complexity * Observability * Compatibility * Trialability

What are the five categories of adopters for a new product?

* Early Majority * Laggards * Innovators * Early Adopters * Late Majority

From the following list, select all of the true statements about new-to-the-market products.

* They disrupt the market because they provide innovative benefits that often render existing products obsolete. * They have never been seen before, and they create a new market. * They have tremendous upside potential for firms because getting to the market before competitors often means increased sales.

Early adopters constitute approximately what percentage of the adopters of a new product?

13.5%

A company can advertise a product as new and improved for only ______ months after it hits store shelves.

6

Just like humans, products go through various stages. This series of stages is called the ______.

product life cycle

Early majority adopters constitute approximately what percentage of the adopters of a new product?

34%

Late majority adopters constitute approximately what percentage of the adopters of a new product?

34%

What type of adopters often rely on others for information, buying a good or service because their friends have already done so?

Late Majority

Select all of the following steps that firms can take to reduce the risks of new product development.

* Make a commitment to the new product development process. * Listen to the customer carefully.

From the following list, select all of the statements that are advantages of product line extensions.

* Manufacturing may be easier and more efficient because the firm already produces similar goods. * The company and brand may be easily recognized. * Customers may already feel loyalty to the product line.

Select all of the statements that are true about the idea screening stage of the new product development process.

* Most new product ideas are rejected during this stage. * During this stage, the firm must decide if ideas fit its new product strategy.

From the following list, select all of the actions that are associated with the new product strategy development stage.

* Providing general guidelines for the NPD process * Specifying the target markets to be served by new products * Specifying how new products will fit into the company's marketing plan *Outlining the general characteristics of the types of products the firm will develop

Drag each outcome to the corresponding type of risk. No items may be used more than once.

* The product is dangerous. - The company faces product recalls and legal liabilities. * The product quality is lower than customers' standards. - Customers return the product in excessive amounts. * The market refuses to pay the target price. - The firm lowers the product price, resulting in lost revenue. * The new product takes sales from an existing product. - The company's total revenue and profits are lower than anticipated.

From the following list, select all of the true statements about new category entries.

* They are less risky than new-to-the-market products because they don't represent something that has never been sold before. * They help companies compete better in an already-established market or enter a new market.

Select all of the following activities that a firm is likely to engage in during a product launch.

*Purchasing the materials needed to package the good *Preparing internal systems to take service orders

Charlie's design company works with some of its engineers to assemble a new office chair made from the same materials that will be used to make the final product. By creating a model made from the same materials, Charlie and his team can test it to ensure it is comfortable and sturdy. This test model is known as a ______.

prototype