Chapter 12

While late to the party, the late majority category of consumers is still significant making up roughly _ of the total consumer market.

34%

The speed with which products diffuse depends on a number of different product characteristics. Which of the following is not a product characteristic to consider?

Affability

_ refers to a group session in which participants work together to generate new ideas.

Brainstorming

Depending on the product category, the time element of the diffusion curve varies. For some product categories, the time it takes to get from innovators to laggards to purchase a product is shorter. Which of the following would be expected to have the shortest time frame for full diffusion?

Children's toys

Match the relative level of profitability with the stage of the product life cycle at which that level of profitability is typically observed.

Growth -> Rapidly rising Maturity -> Peaking or beginning to decline Decline -> Dropping Introduction -> Low or negative

The product development process can be diagrammed as a sequential process. Place the stages in order, with the first stage at top.

Idea generation Concept testing Product development Market testing Product launch Evaluation of results

The diffusion of innovation curve illustrates the typical rate of adoption for a product or service among consumers. According to the curve shown, when would marketers expect to see highest frequency of purchases for a given product or service?

In the middle of the curve

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

Innovators

Place each of the following categories of consumers in the order in which they adopt a product, beginning with the innovators at the top.

Innovators Early adopters Early majority Late majority Laggards

Using a new movie as an example, match each consumer category with the most probable action it would take with regard to viewing the movie.

Innovators -> Would sleep overnight outside the movie theater just to be one of the first to see it Early adopters -> Will go to the movie theater to see it a week after release and after consulting several reviews Early majority -> Will view the movie at a discount-price theater or rent the DVD the first week it is available. Late majority -> Will view the movie on a premium cable TV channel or put it low on their Netflix queue. Laggards -> Will watch the movie once it is on TV-or possibly never.

The following diagram shows different sources for generating new ideas for product development. Which of the following sources is likely to be the most expensive?

Internal R&D

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

Manufacturing Engineering Marketing

What are some advantages experienced by pioneer firms over later entrants?

More likely to develop brand loyalists More readily recognizable to consumers Establish an early market share lead

Some analysts have attributed the success and quick diffusion of the Apple iPod in part to the white earbuds. At the time, earbuds were not seen as often, and most headphones were black, not white. As knowledge of the iPod spread, the white earbuds could be seen if the iPod itself was out of sight. This is an example of which of the factors that affect speed of diffusion?

Observability

_ or breakthrough products are brand new products that establish a completely new market or radically change both the rules of competition and consumer preferences in a market.

Pioneers

_ deals with perception among consumers that a product is better than its substitutes.

Relative advantage

Burger King launched the "Whooper Bar," serving beer as well as burgers in a test market in Miami. Which of the following would have been elements of a good plan for this test market?

Running the TV ads planned for the full launch Offering the complete menu planned for the full launch

As a consumer, being an innovator in a given product category can mean engaging in a number of behaviors. Which behavior would best illustrate an innovator?

Sleeping outside Best Buy for the latest game console

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

The product life cycle

Innovators are as important to firms as they are to other consumers in that they _.

are essentially the testers for a product or service are often experts who provide the initial review

For many Americans, the daily ritual of having coffee is almost automatic and assumed. The same can be said for the Chinese but with tea. For a firm that is marketing a product, this example serves as a reminder to consider the _ of your product and its intended target market.

compatibility

Firms must continually introduce new products with improved features and find new uses for existing products in order to defend its current market share amid intense _.

competition

Trialability and _ refer to how complicated a product is and how easy or hard it is to try.

complexity

During the test marketing, the potential elements of the marketing mix that may be used include which of the following?

coupons advertising

Once a product stops generating sales or profits, or sales and profits are very low, the product is in the _ stage of the product life cycle and eventually exits the market.

decline

Apple created an entirely new brand that started with the iPod and evolved into different product categories (e.g, iPhone, iPad) before anyone else could catch on. Thus, Apple was the _, which made the firm easily recognizable to consumers, helping it to gain an early market share lead.

first mover

The early _ represents the earlier half of the two largest categories of consumers on the diffusion of innovation curve.

majority

In the _ stage of the product life cycle, a firm may want to start looking for new market segments in order to find new opportunities.

maturity

The _ stage of the product life cycle is characterized by the adoption of the product by the late majority and good profitability.

maturity

During the _ firms may pursue several strategies to increase their customer base or defend their market share. One such strategy may be to develop new features or reposition them.

maturity stage

A(n) _ test is when a company shows potential customers the marketing mix variables and then are surveyed if they would buy or use the product again.

premarket

Emerging new trends or changes in consumer tastes can fragment _ markets, which would open new market opportunities.

saturated

Licensing typically occurs more frequently with products that are _ and _ and have complex patents and copyrights.

scientific; technological

By the time the late majority enters the market, sales tend to _ or even decrease slightly toward the end of the stage.

stablilize

Which of the following are reasons that new products fail?

targeting the wrong market segment inappropriate product testing

The _ stage of the life cycle for a new product or service category such as microwave ovens in 1971 and PCs in 1981 usually starts with a single firm, and innovators are the ones to try the new offering.

Introduction

Put the stages in the product life cycle in order from first to last, with the first stage at top.

Introduction Growth Maturity Decline

Usually, during the _ stage of the product life cycle, the typical consumers would be early adopters, and there would be increases in the number of competitors.

growth

During the growth stage of the product life cycle, the market often becomes more segmented. Consumers' preferences can be addressed by adding variations of the product such as different colors, styles, or features, which can lead a successful firm to have _ sales.

increased

During the introduction stage of the product life cycle, we see low sales and negative profits (losses) and typical consumers belong to the _ category of adopters.

innovator

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

Laggards

Without innovation, what options would be available to firms?

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

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

Diffusion

_ are the category of consumers who begin to use a product or service immediately following the innovators.

Early adopters

Lance enjoys owning new gadgets that make his life easier, but he is cautious. He doesn't want the hassle of working through all the initial problems with new technology, so he waits until those problems have been solved. Lance probably belongs to which of the adopter groups?

Early majority

True or false: Prototypes are never crafted individually.

False

Sequential steps are involved in a new product launch. Match each task with the step.

Firm confirms its target market -> First Step Firm decides how the product will be positioned -> Second Step Firm finalized the remaining marketing mix variables for the new product -> Third Step

In the _ stage of the product life cycle, the product gains acceptance, demand and sales increase, and there are more competitors.

growth