MRKT Chp. 8
) In the ________ stage, a firm faces a trade-off between high market share and high profit. A) growth B) decline C) maturity D) introduction E) commercialization
A
) New-product development starts with the step of ________. A) idea generation B) idea screening C) concept development D) concept testing E) test marketing
A
Which of the following is likely to have the longest duration in the market characterized by several periods of renewed interest? A) a style B) a fashion C) a fad D) a first-mover product E) a final good
A
As a result of ________, a company cannot make its product illegally similar to a competitor's already established product. A) anti-monopoly laws B) patent laws C) antitrust laws D) product warranties E) product liability
B
Which of the following is a definition of style? A) a temporary period of unusually high sales driven by consumer enthusiasm and immediate product or brand popularity B) a basic and distinctive mode of expression C) a currently accepted or popular style in a given field D) a trend that serves as a market pioneer for a very short duration E) a trend that represents transient consumer choices relating exclusively to minor goods and services
B
Hollingsworth is a retail company that is planning to release a new line of luxury personal care products. Timothy Banes, the marketing manager, recently presented the marketing strategy for this new line of products titled "Comfort." The managers are now reviewing the sales, costs, and profit projections for the new products to find out whether they satisfy the company's objectives. The managers are conducting a ________ at this stage. A) brainstorming session B) crowdsourcing exercise C) business analysis D) vendor analysis E) concept testing
C
In the ________ stage, a product's sales growth slows or levels off. A) introduction B) growth C) maturity D) decline E) phase-in
C
) Which of the following is a disadvantage of a team-based approach to new-product development? A) It takes longer to get the right products to market. B) The development effort is not as effective because of team members' lack of expertise. C) The approach is hindered by a lack of integration between different departmental functions. D) Organizational confusion and tension can affect the process. E) The process does not work for products with shorter life cycles.
D
Which of the following best represents the options a company has when a product is declining? A) modify the product B) modify the market C) modify the marketing mix D) divesting from the market E) maintain, harvest, or drop the product
E
Jenny's Jellies is engaged in a review of the sales, costs, and profit projections for some new products to find out whether they satisfy the company's objectives. This activity is called business analysis.
F
Managers at the GreenTree Lawn and Garden Products are engaged in marketing strategy development. Thus, commercialization would be the next step for its high-end products that enhance the aesthetics of gardens.
F
Modifying a product is of little use as a strategy in the maturity period of the PLC as the product's decline is irreversible at this stage.
F
New product development begins with a systematic screening of new product ideas through idea screening.
F
Sequential product development has the advantage not only of being a team-oriented approach, but also of being faster in bringing products to market.
F
Successful intrapreneurial programs encourage external sources of new-product ideas.
F
Team-based new-product development encourages employees of all departments to work within the roles and boundaries of their individual department and combine the results of their efforts at the commercialization stage.
F
The business analysis stage is the first stage in the new-product development process.
F
The international growth in the retail industry has been sluggish and reactive with most retail players exploring new markets with little enthusiasm and interest.
F
The purpose of the idea generation stage is to create a few ideas and the purpose of succeeding stages is to increase the number of new-product ideas.
F
The stage at which new product and marketing programs are introduced into realistic market settings is called concept testing.
F
When a company decides to maintain a product in the decline stage, it has no alternative but to sell the product to another firm or simply liquidate it at salvage value
F
The R-W-W framework is used in the second step of the new-product development process which involves ________. A) idea generation B) idea screening C) concept testing D) test marketing E) commercialization
B
The ________ is used to study the course of a product's sales and profits for the duration that it is produced and sold in the market. A) sequential product development process B) product life cycle C) business analysis D) vendor analysis E) portfolio analysis
B
Anita's DayCare plans to offer third-shift childcare, based upon the opening of two new manufacturing plants in the area. Together the plants will hire 423 employees and run all three shifts. Initial test marketing results look promising. To launch this new service, Anita must first decide on ________. A) timing B) employee schedules C) identifying suitable new employees D) local and state regulations E) menu offerings
A
In the concept testing stage of new-product development, a product concept in ________ form is presented to groups of target consumers. A) physical or symbolic B) abstract C) final D) test marketing E) commercialized
A
Wayne Industries is building a new prototype riding lawnmower especially for women. The marketing strategy for the product has been developed and presented. The lawnmower is now being tested rigorously. This step will ensure that the product meets all the CPSC product specifications and leaves little chance for any product liability issues. Once the prototype of the lawnmower passes product tests, the next step is ________. A) test marketing B) portfolio analysis C) commercialization D) internal marketing E) business analysis
A
Which of the following costs is most likely associated with the commercialization stage of new-product development? A) building or renting a manufacturing facility B) paying groups of consumers for participating in crowdsourcing activities C) determining the product's planned price, distribution, and marketing budget D) developing a prototype of the product E) identifying target markets
A
Craft crayons were released in the market over a hundred years ago. Since the release, the company has had remarkable sales despite new entrants in the market, diversified into many other stationery products, and become a household staple in more than 80 countries around the world. The company has added product variations and extensions over the years. Craft crayons are in the ________ stage of the PLC. A) introduction B) maturity C) growth D) decline E) incubation
B
Immediately after concept testing, a firm would engage in the ________ stage. A) idea screening B) marketing strategy development C) business analysis D) product development E) test marketing
B
In the ________ stage, an executive creates a write-up of a new-product idea to be presented to a new-product committee. A) idea generation B) idea screening C) test marketing D) product positioning E) internal marketing
B
In which stage of the PLC will promotional expenditures be especially high in an attempt to create consumer awareness of the product and its features? A) product development B) introduction C) growth D) maturity E) adoption
B
Once the product or service passes the business analysis test, it moves into the ________ stage. A) concept development B) product development C) market testing D) strategy development E) product audit
B
) Big Moose Toys is a market pioneer introducing a modern version of Bullwinkle, the Moose, a character from an animated television series originally broadcast in the 50s and 60s. The company's version of Rocky—the Flying Squirrel—another character from the show, targeted at baby boomers, was a strong success. They need to make the new launch strategy for Bullwinkle consistent with the intended ________. A) pricing B) product position C) brand extension D) prototype E) fad
B
) CellTones, a new company selling several lines of cellular phones, has closely modeled its products on successful products that are already in the marketplace. As it prepares to enter the market with new products that meet high quality and safety standards, which of the following should concern CellTones the most? A) legal obligations to suppliers and dealers B) patent laws C) the Federal Food, Drug, and Cosmetic Act D) product liability suits E) limited warranties
B
A product concept is defined as ________. A) a product idea that is at the stage of brainstorming B) a detailed version of the idea stated in meaningful consumer terms C) the way consumers perceive an actual or potential product D) an idea for a possible product that the company can see itself offering to the market E) an idea for a possible product design that was implemented without screening
B
Quest Inc. has recently conducted a brainstorming session after visiting several trade fairs and generated a large number of ideas for adding new products and services. The owners will begin with the ________ stage to arrive at a realistic number of ideas to adopt. A) idea generation B) idea screening C) concept testing D) concept development E) business analysis
B
Toby's specialized in producing a wide range of clothes and accessories for newborns and infants up to the age of 1 year. Pink is a market leader in the industry for clothes and accessories for toddlers and children up to age four. Recently, Pink and Toby's reached an agreement by the terms of which Pink will be able to sell all of Toby's products and thus target a larger market of children ranging from newborns to toddlers. Which of the following statements would explain this increase in Pink's product offerings? A) Pink and Toby's are competing in different market segments in the same industry. B) Pink acquired Toby's and thus has new products that it can sell in the market. C) Pink commercialized its existing products for children between the ages of two and four. D) Toby's purchased 51% of the shares of Pink and its holdings. E) Toby's and Pink have engaged in an internal marketing strategy in this scenario.
B
Top management can install a(n) ________ to direct the flow of new-product ideas to a central point where they can be collected, reviewed, and evaluated. A) idea evaluation system B) innovation management system C) database D) EIS E) data processing system
B
When a product enters the maturity stage, the company should consider ________. A) harvesting the product B) modifying the product C) divesting the product D) maintaining the product E) dropping the product
B
) A ________ is the way consumers perceive an actual or potential product. A) product audit B) product feature C) product image D) product framework E) product mix
C
) Flurrbies, a line of winter accessories by a leading fashion label, fell in and out of favor with customers quickly. Flurrbies represents an example of a(n) ________. A) first-mover product B) fashion C) fad D) intermediate good E) repositioned product
C
) The PLC concept can be applied by marketers as a useful framework for ________. A) predicting the exact duration that a product will spend in each stage of the lifecycle B) showing how all products pass through the stages of product life cycle in the same order C) describing how products becomes popular, decline, and are cycled back through repositioning D) reflecting how the stages of the product life cycle apply to styles and not to fashions and fads E) explaining how the product life cycle remains constant across different product classes
C
) ________ is a new-product development approach in which one company department works to complete its stage of the process before passing the new product along to the next department and stage. A) Cross-sectional product development B) Simultaneous product development C) Sequential product development D) Product life-cycle analysis E) Internal product marketing
C
A review of the sales, costs, and profit projections for a new product to find out whether they satisfy the company's objectives is called a ________. A) vendor analysis B) portfolio analysis C) business analysis D) SWOT analysis E) concept analysis
C
At Fantastic Flavors, a large regional chain of candy stores, employees from marketing, design, production, and finance work in a cross-functional group to save time and money in the new-product development process. Fantastic Flavors uses a(n) ________ approach. A) intradepartmental new-product development B) sequential new-product development C) team-based new-product development D) simulated test market E) controlled test market
C
Evans and Hills has developed a new line of specialty teas positioned directly against its competitor, Milton Brews. Evans and Hills has pitched its plan to recapture its lost market share on this line of specialty teas and is seeking regular inputs from the test marketing process. To facilitate this process, it is using BuyerScan, a software that generates store-by-store, week-by-week reports on the actual sales of tested products and the impact of in-store and in-home marketing efforts. This scenario illustrates the ________. A) traditional test marketing approach B) just-in-time inventory tracking approach C) controlled test market approach D) simulated test approach E) direct commercialization approach
C
Fads are characterized by their ________. A) enduring nature spanning several generations B) minor popularity and consumer acceptance C) unusually high sales and rapid decline D) basic and distinctive modes of expression that seldom become unpopular E) non-attainment of the last two stages of the product life cycle
C
Felix Solutions is a market leader in designing ergonomic interiors and furnishings for office spaces of all sizes and needs. Some of the largest corporate offices are clients of Felix Solutions and the company is witnessing a steady rise in its market share. The success enjoyed by the company is difficult for competitors to imitate because Felix Solutions always has the products that the market needs. Which of the following, if true, would most likely explain the ability of Felix Solutions to stay in touch with the market needs? A) The marketing team at Felix Solutions has the ability to determine the exact duration of the stages of the product lifecycle as it applies to their company. B) The marketing team at Felix Solutions uses brainstorming as the only idea generation technique. C) The marketing team at Felix Solutions regularly visits all the local, national, and international trade seminars that hold some relevance to its business. D) The marketing team at Felix Solutions bases its product development plans solely on secondary data and organizational history. E) The marketing team at Felix Solutions uses a product-orientation and avoids focusing on market trends.
C
The major purpose of test marketing is to provide management with the information needed to make a final decision about ________. A) the market strategy to be used B) which target market to compete in C) whether to launch the new product D) how aggressively it should compete in the market E) the time taken to commercialize the product
C
Timmons, an electronic gadgets company, has declined in performance since new competitors entered the electronics market. Thomas Baker, the marketing manager at Timmons decided to sell off a number of declining brands, such as WebWay, its oldest general service cellphone model, and AmpOne, its first electronic music player. In these examples, management decided to ________ the products. A) further test B) maintain C) drop D) harvest E) ignore the test market results of
C
Wayne Industries is building a new prototype riding lawnmower especially for women. The marketing strategy for the product has been developed and presented. The lawnmower is now being tested rigorously. This step will ensure that the product meets all the CPSC product specifications and leaves little chance for any product liability issues. Which of the following statements is true with regard to the current stage of product development that the lawnmower is in? A) The new lawnmower is at the introductory stage of the lifecycle. B) The new-product idea is at the last stage of the development process. C) At this stage, the functional features and the intended psychological characteristics are combined. D) The new product at this stage can be distributed through a full-scale roll-out immediately. E) After this stage, no changes can be made in any aspect of the product design, features, or composition.
C
What are the two ways in which a company can obtain new products? A) rebranding and brand management B) internal development and product audits C) new-product development and acquisition D) market development and product extension E) market mix modification and integrated marketing
C
) Habers and Mills had developed a new range of home appliances called Green Home. These appliances had a certification stating that they minimized CFC emissions and energy consumption. The company planned to release the Green Home appliances in 52 stores across 20 countries where Habers and Mills had its stores or franchisees. Though the test marketing process for the Green Home line of products had been completed well ahead of time and the new products were ready for commercialization, the company waited three months to release the final product line on the World Environment Day. Which of the following considerations explains the manner in which Habers and Mills released the Green Home line of appliances? A) whether to launch the product in a single location B) whether to launch the product in a region C) whether to launch the product into full national distribution D) when to time the new product introduction E) when to develop a planned market rollout
D
Benny's, a leading producer of ketchups and jams, experienced a rapid decline in sales in the early 1990s. To regain its market share, Benny's released new flavors like kiwi and litchi for jams and Italian Sundried Tomatoes and Mexican Hot Chilly for ketchups. Benny's aimed to regain its market share by ________ in this scenario. A) modifying the sales strategy B) modifying the pricing strategy C) modifying the distribution channels D) modifying the product features E) modifying the promotional mix
D
Felix Solutions is a market leader in designing ergonomic interiors and furnishings for office spaces of all sizes and needs. Some of the largest corporate offices are clients of Felix Solutions and the company is witnessing a steady rise in its market share. The success enjoyed by the company is difficult for competitors to imitate because Felix Solutions always has the products that the market needs. Which of the following, if true, would strengthen the fact that Felix Solutions encourages open innovation programs in addition to intrapreneurial programs? A) The marketing team at Felix Solutions is organized on the lines of the traditional marketing manager model, rather than a brand manager model. B) The marketing team at Felix Solutions uses brainstorming as the only idea generation technique. C) The marketing team at Felix Solutions offers a quarterly monetary award to the most innovative employee and his/her product idea is considered for the new product development process. D) The marketing team at Felix Solutions runs a feature on its web site called Your-Call which enables every recent customer to call in with new ideas. E) The marketing team at Felix Solutions considers acquisitions and mergers to be the only ways of making additions to its product mix.
D
In the ________ stage of new-product development, products undergo rigorous tests to make sure that they perform safely and effectively or that consumers will find value in them. A) business analysis B) idea generation C) concept development and testing D) product development E) marketing mix
D
Introducing a new product into the market is called ________. A) test marketing B) segmentation C) experimenting D) commercialization E) market penetration
D
Some companies are now appointing ________, whose job is to protect consumers from harm and the company from liability by proactively ferreting out potential product problems. A) intradepartmental teams B) idea generation teams C) product audit committees D) product stewards E) listening officers
D
Some products that have entered the decline stage can be cycled back to the growth stage through ________. A) concept testing B) test marketing C) sole sourcing D) repositioning E) data mining
D
Tavera is a large automobile company that saw performance decline once new competitors entered the market. Tavera is unable to simultaneously finance new product development and provide for improvements to older models. Tommy Hill, the marketing manager at Tavera decided to focus on cost-cutting with the older and more established brands, leaving them without much investment or modification. Tavera had decided to ________ the older products. A) extend B) maintain C) drop D) harvest E) review
D
The team-based new-product development approach is faster because departments work closely together through ________. A) divisional teams B) traditional teams C) self-reference groups D) cross-functional teams E) departmental teams
D
Through ________, broad communities of people (customers, employees, independent scientists and researchers, and even the public at large) are invited into the new-product innovation process. A) outsourcing B) sole sourcing C) brainstorming D) crowdsourcing E) test marketing
D
Which of the following represents an internal source of new-product ideas? A) customers B) distributors C) suppliers D) employees E) competitors
D
Which of the following statements is true of marketing strategy statement? A) The second part of the marketing strategy statement describes the target market. B) The first part of the marketing strategy statement outlines the product's marketing budget for the first year. C) The first part of the marketing strategy statement describes the long-term profit goals and marketing mix strategy for a new product. D) The third part of the marketing strategy statement describes the planned long-run sales. E) The second part of the marketing strategy statement describes the results of test marketing.
D
Which of the following statements is true of the PLC? A) Throughout the product introduction stage, sales are zero. B) During the product decline stage, sales and profits drop in an identical manner. C) Profits are nonexistent in the growth stage. D) Growth is a period of rapid rise in sales but profits are lower than sales. E) Maturity is the period when sales fall off but profits continue to rise.
D
) Under what circumstances might it be wise for a company to do little or no test marketing? A) when a new product requires a major investment B) when management is unsure of the projected demand for the product C) when management is implementing a mass marketing program D) when the product has no substitutes and is new in its category E) when the costs of developing and introducing the product are low
E
Which of the following is true of the growth stage of the PLC? A) The laggards will begin to buy the product at this stage and the early adopters may follow. B) The primary reason for growth at this stage is the lack of competitors in the market as the product is new. C) The firm will begin to reduce its spending on all other parameters and focus only on production of the good. D) Profits are nonexistent at this stage. E) By spending a lot on product improvement and promotion, the firm gives up maximum current profit.
E
Which of the following represents an external source of new-product ideas? A) executives B) salespeople C) engineers D) manufacturing staff E) suppliers
E
Which of the following statements is true with regard to the new-product development process? A) The first stage in the new-product development process is an idea-reducing step. B) When developing new-product ideas, firms restrict the process to internal sources of ideas. C) Intrapreneurial programs are an external source of new-product ideas. D) Crowdsourcing is an internal source of new-product ideas. E) The first stage in this process involves a systematic search for new-product ideas.
E
At the stage of concept testing, the product is evaluated by the management without any inputs from external sources like consumers.
F
CisTech is test marketing its new computers by measuring consumer responses to the new computers and its marketing tactics in laboratory stores. CisTech is using controlled test marketing in this scenario.
F
) A firm can obtain new products in two ways: by acquisition or by new-product development
T
) The INS Corp. finds that the tastes and preferences of its customers change more rapidly now than in the past. Consequently, the marketing manager should constantly look for external ideas from customers, suppliers, the competition, and the sales force.
T
A product idea is an idea for a possible product a company can offer the market, while a product concept is a detailed version of the idea stated in meaningful consumer terms.
T
Although products that remain in the maturity stage of the PLC seem unchanged, the most successful ones actually evolve to meet changing consumer needs.
T
New products include original products that the firm develops through its own R&D efforts.
T
Profits rise during the growth stage of the PLC because promotion costs are spread over a large volume and unit manufacturing costs fall.
T
The Consumer Product Safety Act of 1972 established the Consumer Product Safety Commission, which has the authority to ban or seize potentially harmful products and set severe penalties for violation of the law.
T
The federal government may prevent a company from adding products through acquisitions if the acquisition threatens to lessen competition.
T
The maturity stage of the PLC is characterized by a slowdown in sales growth.
T
To avoid the problems of too few new-product ideas and the failure of many good ideas, management should install an innovation management system that collects, reviews, evaluates, and manages new-product ideas.
T
To test the product concept of a new idea, the R&D department of a firm will develop a prototype that will excite consumers and can be produced quickly at budgeted costs.
T