BA 370 Ch 12

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

1. idea generation 2. concept testing 3. product development 4. market testing 5. product launch 6. evaluation of results

Laggards make up roughly Blank______ of the market. Multiple choice question. 5% 10% 16% 20%

16%

While late to the party, the late majority category of consumers is still significant, making up roughly Blank______ of the total consumer market. Multiple choice question. 50% 13% 16% 34%

34%

brainstorming

A group activity used to generate ideas.

early majority

A group of consumers in the diffusion of innovation model that represents approximately 34 percent of the population; members don't like to take much risk and therefore tend to wait until bugs are worked out of a particular product or service; few new products and services can be profitable until this large group buys them.

R&D consortia

A group of firms and institutions, possibly including government and educational institutions, that explore new ideas or obtain solutions for developing new products.

test marketing

A method of determining the success potential of a new product; it introduces the offering to a limited geographical area prior to a national launch.

licensing

A method used in developing new products in which a firm buys the rights to use a technology or idea from another firm.

outsourcing

A practice in which the client firm hires an outside firm to facilitate some aspect of its business. In the context of new product development, the outsourced firm helps its client develop new products or services.

product development

Also called product design; entails a process of balancing various engineering, manufacturing, marketing, and economic considerations to develop a product's form and features or a service's features.

alpha testing

An attempt by the firm to determine whether a product will perform according to its design and whether it satisfies the need for which it was intended; occurs in the firm's research and development (R&D) department.

The ?? of users representing approximately 34 percent of the population on the diffusion of innovation curve is crucial because few new products and services can be profitable until this large group buys them. (Enter one word in each blank.)

Blank 1: early Blank 2: majority

Which of the following processes could be considered an acceptable method for generating ideas? (Choose every correct answer.) Multiple select question. Arguing with other firms and institutions Brainstorming within the firm Communicating with a firm's R&D department Conducting consumer research Researching competitors' products and services

Brainstorming within the firm Communicating with a firm's R&D department Conducting consumer research Researching competitors' products and services

concept

Brief written description of a product or service; its technology, working principles, and forms; and what customer needs it would satisfy.

premarket test

Conducted before a product or service is brought to market to determine how many customers will try and then continue to use it.

laggards

Consumers, representing approximately 16 percent of the population, who like to avoid change and rely on traditional products until they are no longer available. Sometimes laggards never adopt a product or service.

What might a concept include along with a brief written description of the product? (Choose every correct answer.) Multiple select question. Customer needs it satisfies The final product Visual images Ideas generated

Customer needs it satisfies Visual images

product life cycle

Defines the stages that new products move through as they enter, get established in, and ultimately leave the marketplace and thereby offers marketers a starting point for their strategy planning.

Product development or product design entails a process of balancing which types of considerations? (Choose every correct answer.) Multiple select question. Engineering Marketing Distribution Manufacturing

Engineering Marketing Manufacturing

After a new product is launched, what is the next step of the product development process? Multiple choice question. Concept testing Evaluation of results Pricing the product Developing the advertising campaign

Evaluation of results

New products must be targeted toward end consumers. True false question.TrueFalse

False

Product development entails a variety of processes and considerations to determine which aspects of a product or service? Multiple choice question. Customers and distributors Sales potential Marketing strategy Form and features

Form and features

beta testing

Having potential consumers examine a product prototype in a real-use setting to determine its functionality, performance, potential problems, and other issues specific to its use.

Which of the following factors influence how rapidly a product will move through the product life cycle? (Choose every correct answer.) Multiple select question. How valuable the product is to the consumer The average age of the target market How different the product is from other offerings in the market The size of the producing firm's R&D budget

How valuable the product is to the consumer How different the product is from other offerings in the market

lead users

Innovative product users who modify existing products according to their own ideas to suit their specific needs.

Firms can highlight a product's relative advantage, which refers to which perception among consumers about the product? Multiple choice question. It is new and innovative. It is less expensive than competitors. It is better than its substitutes. It is the most popular item on the market.

It is better than its substitutes.

______ are consumers who like to avoid changes and rely on traditional products until they are no longer available. Multiple choice question. Traditionalists Crawlers Laggards Lollygaggers

Laggards

pioneers

New product introductions that establish a completely new market or radically change both the rules of competition and consumer preferences in a market; also called breakthroughs.

In the context of how firms develop new products, what is the next step if a firm has positive results from market testing? Multiple choice question. Product launch Evaluation of results Licensing Product designing

Product launch

first movers

Product pioneers that are the first to create a market or product category, making them readily recognizable to consumers and thus establishing a commanding and early market share lead.

What are key characteristics of the introduction stage? (Choose every correct answer.) Multiple select question. Buyers are abundant Profits are low Start-up costs are high Sales are high Price competition is fierce

Profits are low Start-up costs are high

What are the key characteristics of the growth stage of the product life cycle? (Choose every correct answer.) Multiple select question. Sales stabilize Typical consumers are innovators Sales rise Competitors increase

Sales rise Competitors increase

maturity stage

Stage of the product life cycle when industry sales reach their peak, so firms try to rejuvenate their products by adding new features or repositioning them.

introduction stage

Stage of the product life cycle when innovators start buying the product.

decline stage

Stage of the product life cycle when sales decline and the product eventually exits the market.

growth stage

Stage of the product life cycle when the product gains acceptance, demand and sales increase, and competitors emerge in the product category.

reverse engineering

Taking apart a competitor's product, analyzing it, and creating an improved product that does not infringe on the competitor's patents, if any exist.

prototype

The first physical form or service description of a new product, still in rough or tentative form, that has the same properties as a new product but is produced through different manufacturing processes, sometimes even crafted individually.

late majority

The last group of buyers to enter a new product market, representing approximately 34% of the population; when they do, the product has achieved its full market potential.

innovation

The process by which ideas are transformed into new products and services that will help firms grow.

diffusion of innovation

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

concept testing

The process in which a concept statement that describes a product or a service is presented to potential buyers or users to obtain their reactions.

______ defines the stages products move through as they enter, get established in, and ultimately leave the marketplace. Multiple choice question. Diffusion of innovation The product development process Alpha and beta testing The product life cycle

The product life cycle

early adopters

The second group of consumers in the diffusion of innovation model, after innovators, to use a product or service innovation represent about 13.5 percent of the population. They generally don't like to take as much risk as innovators but instead wait and purchase the product after careful review.

innovators

Those buyers, representing approximately 2.5 percent of the population, who want to be the first to have the new product or service.

New products and services that consumers accept quickly will have a high Blank______ rate early in their product life cycles, which will accelerate the diffusion process across the various stages. Multiple choice question. diffusion adoption success cycle

adoption

The Apple iPod was readily accepted by consumers in part because it was an easy way to listen to music anywhere, with substantial improvements over portable CD players. This is an example of a relative ? within the diffusion process.

advantage

A ? is a written description of a product and its technology and is presented to potential buyers or users to obtain their reactions.

concept

Fill in the blank question. ? of innovation is the process by which the use of an innovation, whether a product or a service, spreads throughout a market group over time and over various categories of adopters. (Enter one word in each blank.)

diffusion

The process by which the use of an innovation, whether it be a product or service, is spread throughout a market group over time and over various categories of adopters, is known as Blank______. Multiple choice question. the product life cycle viral marketing distribution of product inventory diffusion of innovation

diffusion of innovation

Along the diffusion of innovation curve, Blank______ make up the second group of consumers to adopt an innovation; they tend to be leaders in a social setting. Multiple choice question. early adopters innovators pioneers early majority first movers

early adopters

In terms of their place on the diffusion of innovation curve, innovators are the Blank______ category of consumers. Multiple choice question. first second third majority

first

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

growth

? generation refers to the first stage in the process by which firms develop a new product.

idea

The ? stage of the life cycle for a new product or service category usually starts with a single firm, and innovators are the ones to try the new offering.

introduction

During the decline stage of the product life cycle, Blank______ who have not yet tried the product or service will be entering the market for the first time. Multiple choice question. early adopters laggards marketers innovators

laggards

Those consumers who enter the market for the first time during the decline stage are known as Blank______. Multiple choice question. late adopters innovators late majority laggards

laggards

When the ? majority of consumers enters the market, the market reaches its full market potential.

late

A good or service may pass through many stages as it establishes itself in the marketplace. Marketing managers refer to this as the product ? cycle.

life

During the Blank______ stage of the product life cycle, the market for the product usually becomes saturated. Multiple choice question. maturity indeterminate growth introduction

maturity

The ? stage of the product life cycle is characterized by the adoption of the product by the late majority and good profitability. (Remember to type only one word in the blank.)

maturity

In order to accurately evaluate the new product launch, marketers must undertake a critical Blank______ review to determine whether the product and its launch were a success or failure. Multiple choice question. postlaunch prelaunch introductory-stage growth-stage

postlaunch

When firms decide to develop new products, it is typically a long process that is broken into Blank______ stages. Multiple choice question. two six four one

six

When Burger King introduced the new Whopper Bar to a limited geographic area prior to a national launch, it was engaging in Blank______. Multiple choice question. prototype testing a premarket test test marketing concept testing

test marketing

When Subway introduced a new Southwestern Club sandwich in South Florida before launching it nationwide, it was engaging in Blank______. Multiple choice question. beta testing alpha testing concept testing test marketing

test marketing

If market testing returns with positive results, the firm is then ready to introduce the product to the entire market, which is called a product launch. True false question.TrueFalse

true

Managers can use the product life cycle model to help predict what pricing, product, promotional, and placement strategies they should employ at each of the four stages. True false question.TrueFalse

true

The problem with using the product life cycle concept is that no one can predict the shape that the product's life cycle will take; therefore, it is impossible to know Blank______. Multiple choice question. which group of consumers like the product which stage the product is in if the cost of the product is accurate if more prototypes would be beneficial

which stage the product is in