MKT CH 7

price, promotion and distribution : Unsought

The price and distribution of this type of product varies. Aggressive advertising and personal selling by the producer and resellers.

B

Taco Bell test marketed Doritos Locos Tacos for three years and developed 45 prototypes. Once the decision was made to launch the new taco shell, it moved into the ________ stage of the new product development process. A) concept development B) product development C) test marketing D) strategy development E) commercialization

Concept testing

Testing new-product concepts with a group of target consumers to find out if the concepts have strong consumer appeal. The concepts may be presented to consumers symbolically or physically.

A

The stage in which product ideas are presented to groups of target consumers physically or symbolically is referred to as ________. A) concept testing B) concept development C) test marketing D) marketing strategy development E) crowdsourcing

examples of Convenience

Toothpaste, magazines, and laundry detergent.

idea generating

Using internal sources, the company can find new ideas through formal R&D.•Companies can also obtain good new-product ideas from any of a number of external sources.

C

When a product is in the ________ stage, profits level off or decline because of increased marketing outlays to defend the product against competition. A) production B) decline C) maturity D) test marketing E) conception

A

Which of the following is an example of a convenience product? A) candy B) furniture C) life insurance D) automobile E) refrigerator

D

Which of the following is an example of a shopping product? A) toothpaste B) fast food C) laundry detergent D) television E) candy

C

Which of the following is most likely true of a product in the maturity stage of the product life cycle? A) Sales are zero, and the company's investment costs mount. B) New competitors enter the market. C) A slowdown occurs in sales growth. D) Sales increase with decreasing competition. E) New distribution channels are acquired.

E

Which of the following is true about the introduction stage of a new product? A) Profits are typically high. B) Promotion spending is relatively low. C) Less money is needed to attract distributors. D) Companies tend to avoid basic versions of the product. E) Sales growth tends to be slow.

B

Which of the following statements is most likely true about unsought products? A) Unsought products are consumer products and services that customers buy frequently. B) Marketers use aggressive advertising to convince consumers to buy unsought products. C) Unsought products are typically purchased for further processing by industrial manufacturers. D) Compared to convenience products, unsought products are purchased more frequently. E) Unsought products offer many unique characteristics to status-conscious consumers.

E

Which statement about convenience products is most likely true? A) They are distributed exclusively in only one or a few outlets per market area. B) They are products that consumers rarely consider buying. C) Luxury cars and designer clothes are examples of convenience products. D) Consumers need to make special purchasing efforts to buy such products. E) They are bought by consumers frequently and with minimal comparison.

D

Which statement is most likely true about idea generation in the new product development process? A) Idea generation is most effective when it occurs after idea screening. B) Most companies set a limit for the number of ideas generated to simplify the process. C) Intrapreneurial programs enable customers to contribute to the idea generation process. D) Idea generation is usually followed by procedures that reduce the total number of ideas. E) A company can either develop ideas through internal or external sources but not through both

B

Zappos recognizes the importance of the buyer-seller interaction. They only hire people with an innate "passion to serve" and they go through four weeks of customer loyalty training. This is referred to as ________ marketing. A) horizontal B) interactive C) advocacy D) social E) internal

C

________ is the stage where a product and its proposed marketing program are introduced into realistic market settings. A) Market strategy development B) Concept testing C) Test marketing D) Concept development E) Business analysis

Internal marketing

- the company must orient and motivate its customer-contact employees and supporting service people to work as a team to provide customer satisfaction. For example, Four Seasons Hotels and Resorts starts by hiring the right people and carefully orienting and inspiring them to give unparalleled customer service.

B

A detailed version of a product idea stated in meaningful consumer terms is a ________. A) product feature B) product concept C) product idea D) product image E) product framework

E

A doctor performing hip surgery on a patient illustrates how a service can be produced and consumed simultaneously. This is an example of which service characteristic? A) tangibility B) intangibility C) perishability D) variability E) inseparability

Concept development

An attractive idea must be developed into a product concept - a detailed version of the idea stated in meaningful consumer terms Concept 1: An affordably priced midsize car designed as a second family car to be used around town for running errands and visiting friends. Concept 2: A mid-priced sporty compact appealing to young singles and couples. Concept 3: A "green" car appealing to environmentally conscious people who want practical, low-polluting transportation.

D

Appliances Galore is continually updating its line of refrigerators to reflect market trends and customer needs. Although the product class is in the maturity stage of the product life cycle, they maintain healthy sales of their line of refrigerators by continually ________. A) concept testing B) modifying the marketing mix C) rebranding D) modifying the product E) modifying the market

A

During the ________ stage of the product life cycle, product sales may plunge to zero, or drop to a low level where they continue for many years. A) decline B) growth C) maturity D) ideation E) analysis

A

Colonial furniture has been in existence since the 1600s and continues to adorn homes today. According to the product life cycle concept, it would be described as a ________. A) style B) fashion C) fad D) trend E) drift

B

Consumer products that the buyer either does not know about or knows about but does not normally consider buying are referred to as ________ products. A) convenience B) unsought C) specialty D) shopping E) industrial

B

Craft Inc.'s Krayons is a multi-color chalk material that was released in the market over a century ago. Since the release, the company has had remarkable sales and Krayons has remained unchanged. However, over the last few years, sales of Krayons have been stagnant. Competitors have begun marking prices down, and increasing their advertising and sales promotions. Craft's Krayons is most likely in the ________ stage of the product life cycle. A) introduction B) maturity C) growth D) decline E) incubation

E

Denta Clean's decision to add a whitening toothpaste to its current line of toothpastes is an example of product line ________. A) stretching B) widening C) strengthening D) mixing E) filling

B

Doggie World concept tested an idea for a new chew toy that would entertain dogs while simultaneously cleaning their teeth. Dog owners were pleased with the results. The next stage in developing the new product concept is ________. A) idea screening B) marketing strategy development C) business analysis D) product development E) test marketing

C

Evans and Hills, a beverages manufacturing company, has developed a new line of specialty teas and is seeking regular input from the test marketing process. To facilitate this process, the firm uses 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. Which of the following approaches does this scenario illustrate? A) standard test markets B) inventory tracking C) controlled test markets D) simulated test markets E) direct commercialization

C

Fads are characterized by their ________. A) enduring nature that spans several generations B) low rates of adoption by consumers 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

A

Foods International is developing a new gluten-free, chili-flavored pretzel. The marketing strategy for the product has already been developed and presented to top management. Several prototypes were also formulated by the company's R&D team. The final prototype is now being tested rigorously to ensure that it passes FDA standards. Once approved, the next step will most likely be ________. A) test marketing B) portfolio analysis C) commercialization D) internal marketing E) business analysis

C

Gershwin, a musical toy for toddlers, is in the maturity stage of the product life cycle, and Gershwin managers have decided to modify the product. What will Gershwin managers most likely do to achieve this goal? A) change distributors B) offer coupons for the toy C) change the packaging of the toy D) launch an online advertising campaign E) cut prices of the toy to attract new customers

price, promotion and distribution : Specialty

High Price. More carefully targeted promotion by both the producer and resellers. Exclusive distribution in only one or a few outlets per market area.

price, promotion and distribution: Shopping

Higher Price. Advertising and personal selling by both the producer and resellers. Selective distribution in fewer outlets.

C

Hollingsworth is a retail company that is planning to release a new line of luxury personal care products. Its managers are now reviewing the sales history of similar products and conducting marketing surveys to estimate minimum and maximum sales for the product. In which of the following stages of the new product development process is the product? A) test marketing B) idea screening C) business analysis D) marketing strategy development E) concept testing

C

If a product passes both the concept test and the product test, the next step is most likely to be ________. A) marketing strategy development B) product development C) test marketing D) business analysis E) concept development

Test marketing

If the product passes both the concept test and the product test, the next step is test marketing - the stage at which the product and its proposed marketing program are introduced into realistic market settings.• For example, KFC conducted more than three years of product and market testing before rolling out its major new Kentucky Grilled Chicken product.•Companies can use controlled vs. simulated test markets.•In controlled test markets, new products and tactics are tested among controlled groups of customers and stores.

D

In a sequential new product development process, which of the following is true of the product development step?A) Product development is usually followed by a business analysis of the product. B) Product development involves introducing a product into realistic market settings. C) Product development avoids testing products on actual customers due to liability concerns. D) Product development is usually followed by test marketing. E) Product development helps top management review profit projections.

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 screening D) product development E) test marketing

A

In the ________ stage, a firm most likely faces a trade-off between high market share and high current profit. A) growth B) decline C) maturity D) introduction E) commercialization

A

In which of the following cases is crowdsourcing used for new product development? A) A company creates a forum where anyone can contribute new product ideas. B) A company hires a marketing agency to generate new product ideas. C) A company reviews the sales, costs, and profit projections of an existing product. D) A company depends on its R&D department to come up with new ideas. E) A company partners with a design agency to create a few prototypes.

customer buying behavior: Shopping

Less frequent purchase; much planning and shopping effort; comparison of brands on price, quality, and style.

examples of Unsought

Life insurance and red cross blood donations

customer buying behavior: Unsought

Little product awareness; knowledge(or,if aware, little or even negative interest)

price, promotion and distribution: Convenience

Low price. Mass promotion by the producer. Widespread distribution; convenient locations.

examples of Specialty

Luxury goods such as Rolex watches or fine crystal

B

Major appliances, furniture, and clothing are typical examples of ________ products. A) convenience B) shopping C) unsought D) specialty E) capital

examples of Shopping

Major appliances, televisions, furniture, and clothing.

D

Orienting and motivating customer-contact employees and supporting service people to work as a team to provide customer satisfaction is known as ________ marketing. A) social B) organizational C) differentiated D) internal E) interactive

A

Parvon, a cleaning product, is in the maturity stage of the product life cycle, and Parvon managers have decided to modify the market. Which of the following steps should Parvon managers most likely take to achieve this goal? A) find new market segments for the brand B) improve the overall quality of the product C) reduce mass media advertising expenses D) offer improved services to new buyers E) conduct controlled test marketing activities

Variability

Quality of services depends on who provides them and when, where, and how they are provided

Product development

R&D or engineering develops the product concept into a physical product.•Products undergo rigorous tests to make sure that they perform safely and effectively, or that consumers will find value in them. •Companies can do their own product testing or outsource testing to other firms that specialize in testing.

B

Safari Unlimited recently conducted national research to generate ideas for a new line of fatigues geared to women. The company uncovered a number of ideas about clothing and accessory preferences as well as important benefits such as built-in sunblock and durability. The Safari Unlimited product development team will most likely use ________ next to arrive at a realistic number of products for the new fatigues line. A) crowdsourcing B) idea screening C) concept testing D) concept development E) business analysis

B

Service variability means that ________. A) the evaluation of services is subjective and changes from customer to customer B) service quality depends on when, where, and how they are provided C) services cannot be stored for later sale or use D) services cannot be seen, tasted, felt, heard, or smelled before they are bought E) services can be separated from their providers

Inseparability

Services are produced and consumed at the same time and cannot be separated from their providers.

Perishability

Services cannot be stored for later sale or use.

E

Silkskin Cosmetics is advertising its newest line of eye makeup. Made from all-natural ingredients, the products are hypoallergenic. Silkskin is selling the products in specially designed tubes that make application easier. Which of the following is a core customer value for Silkskin's line of eye makeup? A) the natural ingredients B) the Silkskin brand C) the products' revolutionary packaging D) the hypoallergenic properties of the products E) the desire for having beautiful eyes

D

Specialty products are consumer products and services that customers generally buy ________. A) to conduct business B) frequently and immediately C) based on ready availability D) without making comparisons E) with minimal effort

customer buying behavior: Specialty

Strong Brand preference and loyalty; special purchase effort; little comparison of brands; low price sensitivity

Marketing strategy development

Suppose the carmaker finds that concept 3 for the electric car tests best. The next step is marketing strategy development, designing an initial marketing strategy for introducing this car to the market. The marketing strategy statement describes the target market, planned value proposition, sales, market-share, and profit goals and determines product's planned price, distribution, and marketing budget.

C

Susan has been redecorating her new condo for a year. She is carefully selecting every item. Susan finds an oriental rug that matches her color scheme and décor perfectly and purchases it immediately without engaging in comparison shopping. This is an example of a(n) ________. A) shopping product B) convenience product C) specialty product D) industrial product E) capital product

D

________ products are consumer products and services that customers usually buy frequently, immediately, and with minimal comparison and buying effort. A) Shopping B) Specialty C) Capital D) Convenience E) Unsought

D

________ products are less frequently purchased consumer products and services that customers compare carefully on suitability, quality, price, and style. A) Convenience B) Capital C) Unsought D) Shopping E) Secondary

Product development

begins when the company finds and develops a new-product idea. During product development, sales are zero, and the company's investment costs mount.

customer buying behavior: convenience

frequent purchaser, little planning, little comparison or shopping effort, low customer involvement

D

hich of the following statements is most likely true about the product life cycle? A) Throughout the product introduction stage, sales are zero. B) The growth stage is the longest stage of the product life cycle. C) Profits are nonexistent in the growth stage. D) Growth is a period of rapid market acceptance and increasing profits. E) Maturity is the period when sales fall off but profits continue to rise.

Business analysis

involves a review of the sales, costs, and profit projections for a new product to find out whether they satisfy the company's objectives. If they do, the product can move to the product development stage.

The core customer value

is that they block the sun from people's eyes and can be used for self-expression.

actual product

is the shape, design, look, feel and brand name of the glasses.

augmented product

offers additional consumer services and benefits built around the core benefit and actual product such as after-sale service, warranty, product support and delivery and credit. is the bottle of cleaning solution that costs extra or the purchase of a 1-year warranty incase they break.

Idea screening

screening new-product ideas to spot good ideas and drop poor ones as soon as possible.

Interactive marketing

service quality depends heavily on the quality of the buyer-seller interaction during the service encounter. Four Seasons selects only people with an innate "passion to serve" and instructs them carefully in the fine art of interacting with customers to satisfy their every need.

Intangibility

services cannot be seen, tasted, felt, heard, or smelled before purchase