Marketing Management Chpt 15

Which of the following is most closely related with the organic growth of an organization?

developing new products from within

Which of the following terms refers to the degree to which the innovation can be tried on a limited basis?

divisibility

Most established companies focus on ________ innovation when they aim to enter new markets by tweaking existing products, or they want to stay one step ahead in the market by using variations on a core product.

incremental

It has been observed that most new products have shorter product life cycles. What is the reason for this?

Rivals quickly copy products that are successful.

A(n) ________ is a possible product the company might offer to the market.

product idea

________ is a "hybrid" data collection technique that combines self-explicated importance ratings with pair-wise trade-off tasks.

Adaptive conjoint analysis

________ testing is a customer test that involves placing the product within the firm to see how it performs in different applications.

Alpha

During ________ testing, the company's technical people observe how customers use the product, a practice that often exposes unanticipated problems of safety and servicing and alerts the company to customer training and servicing requirements.

Beta

Many people believe that customer focus does not help to create better, or new, products. This belief rests on which of the following ideas?

Customers are at times unaware of what they really want.

A ________ error occurs when the company dismisses a good idea.

DROP

A business analysis is performed mainly to identify if a company has got a technically and commercially sound product

False

A major drawback of conjoint analysis is that it cannot be used to measure objective attributes such as estimated market share and profit

False

Almost all companies use the conventional percentage-of-sales figure while budgeting for new product development.

False

Angell Healthcare, the world's largest manufacturer of protective gloves and clothing, adopted a spiral development process, which divided the innovation process into stages with checkpoints at the end of each stage, to develop products that increased overall sales from 4.6 percent to 13 percent in a little over two years

False

At the interest stage of the consumer-adoption process, the consumer becomes aware of the innovation but lacks information about it.

False

Attribute listing lists several ideas and considers each in relationship to the others

False

Compatibility refers to the degree to which the innovation matches the values and experiences of the individuals.

False

Customers of a proposed truck may want a certain acceleration rate, which is a desired customer attribute. Engineers can turn this into the required horsepower and other engineering attributes through a process known as alpha testing.

False

High-tech firms that function in a market with high technological uncertainty, high market uncertainty, and high investment costs are not likely to seek radical innovation

False

Modular function deployment methodology takes the list of desired customer attributes generated by market research and turns them into a list of engineering attributes that engineers can use.

False

Morphological analysis starts by forming a new dimension and then thinks about the possible problems of the dimension

False

Perceived value refers to the gap between actual needs and satisfied needs of a customer

False

Shorter product life cycles are common in industries characterized by low level of competition

False

Some firms might delay a new product launch until after the competitor has borne the cost of educating the market and its product may reveal flaws the late entrant can avoid. This can be classified as a parallel entry.

False

Survival-age distribution refers to the number of customers that the product has in year one, two, three, and so on

False

The step in the consumer-adoption process where a consumer considers whether to try the innovation is interest.

False

When a company combines two product concepts or ideas to create a new offering, it is called reverse assumption analysis.

False

________ exhibit replacement cycles dictated by physical wear or obsolescence associated with changing style, features, and performance.

Infrequently purchased products

Which of the following is the best example of a new-to-the-world product?

Kids-Med, a company that produces childcare products, launches a non-contact thermometer.

Identify a shortcoming of giving the responsibility to develop new products to the product managers of a company.

Product managers are often busy managing existing lines

Companies typically must create a strong R&D and marketing partnership to pull off a radical innovation.

True

Crowdsourcing means inviting an Internet community to help create content or software, often with prize money or a moment of glory as an incentive.

True

Dragalong income refers to additional income whereas cannibalized income refers to reduced income.

True

Employees can be a source of ideas for improving production, products, and services

True

A team formed at Intercom Inc. to generate ideas for new products conducts frequent meetings and engages in activities such as mind mapping and brainstorming. Most of the meetings are conducted at informal locations away from office. These workplaces are called ________.

Skunkworks

________ contribution lists the changes in income to other company products caused by the introduction of a new product.

Supplementary

Fewer than 10 percent of all new products are truly innovative and new to the world

True

A business analysis is typically performed after management has developed the product concept and marketing strategy.

True

Cocreation can help a company create favorable word of mouth.

True

In response to a short-term oversupply of wine in the marketplace, the makers of Kendall-Jackson developed two new brands by using rapid prototyping — designing products on a computer and producing rough models to show potential consumers for their reactions — to quickly bring its ideas to life.

True

Most established companies focus on incremental innovation rather than radical innovation.

True

Rapid prototyping refers to designing products on a computer and then producing rough models to show potential consumers for their reactions

True

Reverse assumption analysis lists all the normal assumptions about an entity and then turns them around

True

Sales-wave research can be implemented quickly and carried out without final packaging and advertising

True

Intercom Inc., together with its subsidiaries, primarily engages in the generation, transmission, and distribution of electric power in the United States. The company observes that its growth has stagnated over a period of two years. In an attempt to promote growth, it considers adding new features to the existing products and introducing a few new products. The company forms a committee consisting of three top executives, one of the production mangers, a few operational managers, and a representative of the HR department to generate ideas. This team is called a(n) ________ team.

Venture

________ teams are cross-functional groups charged with developing a specific product or business.

Venture

Which of the following firms is most likely to seek radical innovation?

a high-tech firm in telecommunications

The trade-off approach may be easier to use when there ________.

are many variables

Electro Locomotors (EL) Inc. engages in the manufacture, distribution, and marketing of custom vehicles in Brazil. Bono, a hybrid car brand that the company produces, is a market leader in the hybrid vehicles segment. With the increased global focus on nature-friendly vehicles and governmental subsidies for companies that manufacture hybrid vehicles, competition has increased for flex-fuel cars like Bono. The heads of the R&D team at EL are in a creative session to generate ideas for improvements to Bono. They consider each part of the car and discuss the possibilities of improvements in each of them. Identify the creativity technique used here.

attribute listing

The ________ technique for stimulating creativity lists all the characteristics of an object and then modifies each to try to arrive at a new idea.

attribute listing

Adopters of new products move through five stages. These stages begin with ________ and follow with interest, evaluation, trial, and adoption.

awareness

The degree to which the beneficial results of an innovation's use are observable or describable to others is called ________.

communicability

During which of the following stages in new product development decision making do managers analyze if they can find a good thought consumers say they would try?

concept development and testing

________ means presenting the product concept to target consumers, symbolically or physically, and getting their reactions.

concept testing

After creating a product prototype, a company tests it within the firm to see how it performs in different applications. The company refines the prototype to correct the mistakes found in in-house testing. What should be the next step?

conducting beta testing with customers

Consumer preferences for alternative product concepts can be measured through ________, a method for deriving the utility values that consumers attach to varying levels of a product's attributes.

conjoint analysis

Universal Services Inc. provides communication services to residential and business customers in rural and small urban communities primarily in northern England. The company offers services such as local and long distance voice, data, and Internet and broadband product offerings. The company, in an attempt to increase the attractiveness of its offerings, decides to provide special voice and data packages to its customers. The company designs eight different packs that offer varying voice and data benefits to customers. The company then asks a few of its customers to rank the packs in order to choose two best packs. Which of the following testing methods is being used in this scenario?

conjoint analysis

With ________, respondents see different hypothetical offers formed by combining varying levels of the attributes, then rank the various offers.

conjoint anaylsis

Companies such as Edison Nation and the Big Idea Group have sprung up to tap into ________ possibilities, often combining its own design, branding, engineering, and sales teams with online participants, forming a community for devising new products.

crowdsourcing

________ means inviting the Internet community to help create content or software, often with prize money or a moment of glory involved.

crowdsourcing

Joseph, a student of Columbia University, finds many of his classmates have purchased an iPad tablet from Apple. The iPad, launched a few months before has been identified as a very useful product and many students in the US have rated it highly. Considering all these, Joseph also decides to purchase an iPad. Which of the following is the adopter group to which Joseph belongs?

early majority

Armordo is a famous vacuum cleaner brand in Africa. Clara has heard of Armordo and she knows that the product is a success. She has started considering whether or not to buy the vacuum cleaner. What stage of the consumer-adoption process is Clara in?

evaluation

) The stage in the new product process that occurs first and has a pass ratio of 1:4 is the ________ stage.

idea screening

Which of the following products is most likely to undergo alpha and beta testing

industrial goods

A(n) ________ is any good, service, or idea that is perceived as new, no matter how long its history.

innovative

Jason is a technology enthusiast who is happy to conduct alpha and beta testing and report on early weaknesses of consumer electronics products. He is most likely to fall in the ________ adopter category.

innovator

People who are technology enthusiasts, venturesome, and who enjoy tinkering with new products and mastering their intricacies are called ________.

innovators

Robert has heard about the latest cell phone from LG Electronics that features Wi-Fi hotspot technology. Wi-Fi hotspot is a technology that allows users to share mobile internet with other Wi-Fi enabled devices. Robert visits the company's Web site to read more about the phone. Robert is in the ________ stage of consumer-adoption process.

interest

Troma Inc. is a famous manufacturer of cookware that follows a traditional distributor-retailer system to distribute its products. The company abstains from the use of automated supply chain management (SCM) systems mainly due to the fear of unknown. However, rapidly escalating operational costs and inefficiencies have made it necessary for the company to implement an SCM system. The company goes for a big-bang installation of SCM system to become more competitive and cost effective. Identify the adopter group to which Troma belongs.

laggard

Some firms might delay the launch of their products until after the competitor has borne the cost of educating the market. Such an entry is called ________ entry.

late

Increasingly, new-product ideas arise from ________ that combines two product concepts or ideas to create a new offering.

lateral marketing

Morboro Energy Inc. is a large chain of fuel stations in Europe. The company decided to expand its business by incorporating restaurants and automobile service stations as a part of its fuel outlets. This is an example of ________.

lateral marketing

Surgeons and ER nurses would be considered ________ for surgical equipment.

lead users

The highest loss a project can create is called ________.

maximum investment exposure

A group of college graduates decides to start a business. Though they are knowledgeable in various business domains, they are unable to arrive at a valuable business idea. They decide to search for ideas in a structured manner. They meet and start discussing everyone's ideas. Each idea is recorded and then the thoughts that come up in relation to the ideas are written down and discussed. This process helps them to finalize a business plan. What technique is used here?

mind mapping

The ________ creativity technique begins with a thought that is written down, then proceeds to develop other thoughts that are linked to the first thought, and finally a new idea materializes by associating all of the thoughts.

mindmapping

In an attempt to improve the product, a company that manufactures screwdrivers discusses the modification of each attribute, such as replacing the wooden handle with plastic, providing torque power, adding different screw heads, and so on. This creativity technique is called ________.

morphological analysis

New-to-the-world products are ________.

new products that create an entirely new market

Poga International, a multinational beverage corporation identifies that one of its competitors is launching an apple flavored drink. The company decides to launch an apple flavor brand along with its competitor. What timing strategy is used here?

parallel entry

Pager, a simple personal device for short messages, became famous in the 1990s. Troveron Communications launched a pager in the early twenty-first century. Due to the introduction of mobile phones and text messaging, the pager industry was on a decline. The company's innovations were not well received by the market and the product was a failure. Which of the following is the most likely reason for the product's failure in this case?

poor launch timing of the product

A(n) ________ is an elaborated version of a product idea expressed in consumer terms.

product concept

In consumer-goods market testing, the company seeks to estimate four variables. These four variables are: trial, first repeat, adoption, and ________.

purchase frequency

The job of translating target customer requirements into a working prototype is helped by a set of methods referred to as ________.

quality function deployment

Which of the following methodologies takes the list of desired customer attributes (CAs) generated by market research and turns them into a list of engineering attributes (EAs) that engineers can use?

quality function deployment

Which of the following strategies for new-product development incorporates buyers' preferences in the final design of the product?

quality function deployment

Modern firms use the ________ tool to design products on a computer and then produce rough models to show potential consumers for their reactions.

rapid phototyping

Brown & Smith Inc. engages in the design, development, making, and retail selling of designer jewelry in North America. Before approving a new design, the company draws it on a computer and then produces models to show potential consumers and get their reactions. This allows the company to analyze the possible customer reaction. Identify the concept testing method used here. A) conjoint analysis

rapid photoyping

Jordan's firm enters new markets by tweaking products for new customers, uses variations on a core product to stay one step ahead of the market, and creates interim solutions for industry-wide products. In other words, it uses ________.

rational innovations

Five characteristics influence the rate of adoption of an innovation. One of these is ________.

relative advantage

A large FMCG company decides to test market Kora, a new brand of face cleanser, to be launched soon. The company initially distributes a few free samples to some prospective consumers. Later it offers the product to the customers at a discounted price and observes that not only more than seventy percent of the customers are purchasing it but the same number are also satisfied using it. The company keeps using this process 3-4 times to obtain a correct count of the number of people purchasing the product repeatedly. Which of the following testing methods is being used here?

sales wave reseach

A ________ process recognizes the value of returning to an earlier stage to make improvements before moving forward.

spiral development

A ________ divides the innovation process into stages with a checkpoint at the end of each stage.

stage-gate system

To estimate replacement sales, management must research the product's ________, the number of units that fail in year one, two, three, and so on.

survival-age distribution