MKTG 345 - Chapter 9 Marketing

Controlled test market

A company develops a product and contracts its entire test program to an outside service that can guarantee a specified percentage of the product's potential distribution volume.

Simulated test market

A company develops a product and runs tests, often in a shopping mall, to get opinions on the product concept, attributes, and usage from qualified participants.

Standard test market

A company develops a product and then attempts to sell it through normal distribution channels in a number of select cities.

________ is the stage of the new-product process that results in a pool of concepts as candidates for new products.

Idea generation

Which of the following characteristics is not one that distinguishes services from other products?

Immobility

________ is the stage of the new-product process that internally and externally analyzes new-product ideas to eliminate those that warrant no further effort.

Screening and evaluation

________ can be classified according to whether they are delivered by people or equipment, or whether they are provided by business firms or nonprofit organizations.

Services

In the ________ stage of the new-product process an organization defines the role of a new product in terms of the firm's overall objectives.

new-product strategy development

good

nondurable and durable goods

idle production capacity

occurs when the service provider is available but there is no demand for the service

________ can be classified according to whether they are delivered by people or equipment, or whether they are provided by business firms or nonprofit organizations.

services

products

a good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies customer's needs and is received in exchange for money or something else of value

product line

a group of items that are closely related

product item

a specific product that has a unique brand, size, or price

A gap analysis focuses service providers on the difference between

consumer expectations and experiences of service quality dimensions.

feature fatigue

consumers choose overly complex products

Newness: The Consumer's Perspective

continuous innovation, dynamically continuous innovation, discontinuous innovation

types of consumer products

convenience, shopping, specialty, unsought

Although there are numerous stages in the new-product process, firms develop a strategy, then start ________ and continue the process through the final step of ________,

idea generation; commercialization

Services can be __________ because the real people who provide them may vary in their abilities and motivations, or even their moods, resulting in differences in perceived quality.

inconsistent

There may be a great deal of interaction between a service provider and a consumer in which they co-create value together. In such situations, the customer perceives a high degree of ________ between the service provider and the company he or she represents.

inseparability

shopping products

items for which the consumer compares several alternatives on criteria such as price, quality, or style

unsought products

items that the consumer does not know about or knows about but does not initially want

specialty products

items that the consumer makes a special effort to search out and buy

convenience products

items that the consumer purchases frequently, conveniently, and with a minimum of shopping effort

new-product strategy development

the stage of the new development process that defines the role for a new product in terms of the firm's overall objectives

development

the stage of the new product development process that turns the idea on paper into a prototype

idea generation

the stage of the new-product development process that develops a pool of concepts to serve as candidates for new products, building upon the previous stage's results

screening and evaluation

the stage of the new-product process that internally and externally evaluates new-product ideas to eliminate those that warrant no further effort

commercialization

the stage of the new-product process that positions and launches a new product in full-scale production and sales

Services are generally considered to be intangible; that is,

they cannot be held, touched, or seen before purchase.

feature bloat

unnecessary features or functions

gap analysis

expectations vs experiences

The use of open innovation can be useful in the ________ stage of the new-product process because it helps organizations find and execute product concepts externally and overcome the associated not-invented-here barriers.

idea generation

services

intangible activities or benefits that an organization provides to satisfy consumers' needs in exchange for money or something else of value

The cost of paying the person used to provide the service along with any needed equipment is known as the cost.(one word)

inventory

The large difference in ______ costs between airlines and hair salons results from airlines having highly paid employees and expensive equipment to maintain.

inventory

The term ________ is difficult to define and apply to products, and one can think about it from an organizational, consumer, or even a legal perspective.

'new'

Newness in legal terms:

"New" term is limited to 6 months

market testing

- standard test markets - controlled test markets - simulated test markers (STMs) - when test markets don't work

organizational inertia in new-product failures:

-encountering "groupthink" in task force and committee meetings -avoiding the "Not-invented Here problem"

Marketing Reasons for New-Product Failures

1. Insignificant point of difference 2. Incomplete market and product protocol before product development starts 3. Not satisfying customer needs on critical factors 4. Bad timing 5. No economical access to buyers 6. Poor product quality 7. Poor execution of the marketing mix: brand name, package, price, promotion, distribution 8. Too little market attractiveness

Seven stages in the new-product process leading to success

1. New - product strategy development 2. idea generation 3. screening and evaluation 4. Business analysis 5. Development 6. Market testing 7. Commercialization

Intangible

A service cannot be held, touched, or seen before the purchase decision. The consumer cannot evaluate the quality of an airline flight before getting onboard.

protocol

A statement that, before product development begins, identifies: (1) a well-defined target market; (2) specific customers' needs, wants, and preferences; and (3) what the product will be and do to satisfy consumers.

Inconsistency

Because services depend on the people who provide them, their quality varies with each person's capability and day-to-day job performance. An opera performer may have a bad cold and give a worse-than-typical performance when you see her.

________ is the stage of the new-product process that positions and launches a new product in full-scale production and sales.

Commercialization

________ products are purchased by the ultimate consumer, whereas ________ products are purchased by organization to assist them in providing other products for sale.

Consumer; business

Which two of the following are types of tests available to organizations during the market testing stage of the new-product process?

Controlled test markets Standard test markets

Manufacturing the product efficiently and performing laboratory and consumer tests to ensure it meets protocol standards are part of which stage of the new-product process?

Development

________ is the stage of the new-product process in which an idea is turned into a prototype.

Development

The new-product process stage of market testing involves which two of the following?

Exposing actual products to prospective consumers Using realistic purchase conditions to see if consumers will buy

Inseparable

In most cases, the consumer does not view the deliverer of the service as distinct from the service itself. Students' evaluations of their education will be influenced primarily by their perceptions of instructors, counselors, librarians, and other people at the university.

Services marketing differs from the marketing of tangible goods in all of the following ways EXCEPT which of the following?

Inconvertibility

Which two of the following factors are unique with respect to services, and are part of the four I's?

Inseparability Inventory

________ is the stage of the new-product process that involves exposing actual products to prospective consumers under realistic purchase conditions to see if they will buy.

Market testing

In which stage of the new-product process does an organization use a SWOT analysis and develop a product protocol?

New-product strategy development

Which of the following are important points of view when considering a product's "newness"?

Newness in legal terms Newness compared with existing products Newness from the organization's perspective

Which of the following is not a stage in the new-product process

Problem definition

Which of the following are typical ways that a service can be classified?

Profit or nonprofit Delivery by person or equipment

Inventory

Services are often costly in that the firm must maintain the personnel and equipment necessary to provide the services at the time the consumer wants them. There are high costs associated with paying a physician to see patients but no one schedules an appointment.

Which of the following are types of consumer products?

Specialty products Shopping products Convenience products

Which of the following should be included in a protocol for new product development?

Specific customer needs, wants, and preferences What the product will be and do A well-defined target market

The new-product process stage of business analysis involves which two of the following?

Specifying the marketing strategy needed to bring a new product to market Making financial projections for a new product

business analysis

The stage of the new-product development process that specifies the features of the product and the marketing strategy needed to bring it to market and make financial projections.

product mix

all the product lines offered

Because services are intangible, they

are much more difficult for consumers to evaluate before the purchase.

Shopping product

briefcases or airline tickets

unsought product

burial insurance or thesaurs

While consumer products are purchased by the ultimate consumer, whereas ______ products are purchase by organizations to assist them in providing other products for sale.

business

While consumer products are purchased by the ultimate consumer, whereas __________ products are purchase by organizations to assist them in providing other products for sale.

business

The ________ stage of the new-product process assesses the total "business fit" of the proposed new product with the company's mission and objectives, from whether the product can be economically developed and manufactured to the marketing strategy needed to have it succeed in the marketplace.

business analysis

The new-product process stage of involves positioning and launching a new product in full-scale production and sales.

commercialization

newness:

compared to existing products 1. product is new if functionally different from existing products 2. revolutionary newness can create new industries

business products for organizations:

derived demand, components, and support products

The new-product process stage of screening and evaluation involves

determining which ideas should be eliminated from further effort.

product class (or industry)

different products forms exist within the product class

prototype

full-scale model

One of the most effective methods to assess how well an organization is delivering service to its consumers is use a(n) ________ analysis, questioning them on their expectations and experiences.

gap

Though some intangible attributes like delivery or a warranty may also be important for a product like a washing machine, a(n) ________ like this is defined by having tangible attributes.

good

Convenience product

hand soap or ATM withdrawal

One of the basic ways in which services differ from tangible goods is that the service and the deliverer of it are ________ from each other.

inseparable

support products

installations, accessory equipment, supplies, industrial services

Four I's of Services

intangibility, inconsistency, inseparability, inventory

A product ________ is a group of product or service items that are closely related because they satisfy a class of needs, are used together, are sold to the same group, are distributed through the same outlets, or fall within a given price range.

line

Nike's product ________ include shoes and clothing, whereas the Mayo Clinic's consist of inpatient hospital care and outpatient physician services.

lines

The use of a ______ allows a marketing manager to quickly identify areas where sales are lagging and begin to investigate why.

marketing dashboard

Comparing a new product's actual sales in various parts of the country to the goals set during new-product planning is an example of using

marketing metrics.

delivery by:

people or equipment, business firms or nonprofit organizations, and government agencies

open innovation

practices that encourage the use of external and internal ideas

Newness from the organization's perspective

product line extension, jump in innovation, and brand extension

A(n) __________ is a good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers' needs and is received in exchange for money or something else of value. (one word)

products

business products

products organizations buy that assist in providing other products for resale. Also called B2B products or industrial products

consumer products

products purchased by the ultimate consumer

A ________ is a predevelopment statement that identifies a target market, customer needs, and what the product will be or do.

protocol

Dimensions of service quality

reliability, tangibility, and repsonsiveness

specialty product

rolex watch or heart surgery

A product can be a good, ________, or idea and it must satisfy ________.

service; consumer needs

A good is a product that is defined as having ________ attributes.

tangible

new-product development process

the 7 stages an organization goes through to identify opportunities and convert them into salable products or services

The primary reason there is greater inconsistency in services than in tangible goods is because

the people who provide services vary in capability or daily performance.