chapter 12 (exam 2)!

Without innovation, what options would be available to firms? (Choose every correct answer.)

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

The product development process can be diagrammed as a sequential process. Place the stages in order

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

Laggards make up roughly ______ of the market.

16%

The early majority represents approximately ______ of the total consumer market and is crucial to the profitability of a product or service. Without them, the product or service will typically fail.

34%

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

34%

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

34%

When firms decide to develop new products, it is typically a long process that is broken into Blank______ stages.

6

Which type of firm is most likely to engage in a licensing approach to R&D?

A firm with a low budget and a need to get a product to market quickly

Which of the following is an example of a research and development effort?

A test kitchen at a fast food restaurant

Some markets demand a higher frequency of new product releases than others. In which of the following markets do sales come from new products? Gardening equipment Books Over-the-counter medicines Movies Video games

Books Movies Video games

Which of the following processes could be considered an acceptable method for generating ideas? Arguing with other firms and institutions Brainstorming within the firm Researching competitors' products and services Conducting consumer research Communicating with a firm's R&D department

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

Which of the following is a way by which risk can be diversified?

By creating a broader portfolio of products through innovation

What are the key characteristics of the growth stage of the product life cycle? (Select all that apply.) Sales stabilize Typical consumers are innovators Competitors increase Sales rise

Competitors increase Sales rise

Without innovation, what options would be available to firms? Develop new products for current markets Continue to market current products to current customers Develop new products for new markets Take current products to new markets

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

______________________ 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.

Diffusion

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

Evaluation of results

True or false: New products must be targeted toward end consumers.

False

What is a key characteristic of the maturity stage? Firms defend market share Adoption of the product by early majority High prices Few competitors in the market

Firms defend market share

Which of the following statements about firms' expectations regarding the success of internal research and development efforts is true?

Firms expect that a few highly successful products will cover the costs of the entire R&D effort.

Product development entails a variety of processes and considerations to determine which aspects of a product or service?

Form and features

Which of the following factors influence how rapidly a product will move through the product life cycle? (Select all that apply.) The average age of the target 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

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

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

Innovation

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

Innovators

Hightower Industries wants to be a pioneering firm in the robotics and artificial intelligence industry. Which strategy is the company most likely to pursue

Invest heavily in research and development

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

It is better than its substitutes

What will happen to a firm if it continues to produce the same products in a saturated market? Its revenues will stay the same. It will experience rapid growth. Its revenues will grow slowly. It will eventually decline.

It will eventually decline

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

Laggards

______ is an agreement through which one firm buys the rights to use the technology or ideas of another research-intensive firm.

Licensing

Product development or product design entails a process of balancing which types of considerations? Manufacturing Marketing Distribution Engineering

Manufacturing Marketing Engineering

In distinguishing between firm strategies for developing new products, a pioneer firm will be more likely to rely on its Blank______, whereas a follower firm will be more likely to Blank______ for ideas.

R&D department; scan the market

A firm's ______ and _________ department consists of scientists who work to solve complex problems and develop new ideas.

Research and Devolpment ( R and D)

A firm that joins with other firms as well as government and educational institutions to research a costly new technology is participating in which of the following?

Research consortium

Which of the following processes could be considered an acceptable method for generating ideas? (Choose every correct answer.)

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

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

The product life cycle

What objective(s) do firms have in adding new products, services, and processes to their offerings? (Select all that apply.) To satisfy the changing needs of consumers To keep customers from getting bored with existing products To lower production costs To attract talented employees to the firm

To satisfy the changing needs of consumers To keep customers from getting bored with existing products

True or false: 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

Adding new products is MOST likely to prompt consumers to purchase in which of the following industries? Video games Household appliances Oil and gas Writing utensils

Video games

What might a concept include along with a brief written description of the product?

Visual images Customer needs it satisfies

What does a postlaunch review help determine? (Select all that apply.) Whether competitors should be eliminated Whether new management should be hired Whether changes to the marketing mix are needed Whether additional resources are needed Whether the launch was a success or failure

Whether changes to the marketing mix are needed Whether additional resources are needed Whether the launch was a success or failure

Early ____________ are the category of consumers who begin to use a product or service immediately following innovators. (Remember to type only one word in each blank.)

adopters

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

Firms need to continue to innovate because customer needs Blank______.

are constantly changing

Firms need to continue to innovate because customer needs ______. are constantly changing tend to stay constant over time are insignificant compared to the need to always use the newest technologies can be disregarded once a product is established in the market

are constantly changing

Products that generate enough revenue to cover the losses from other unsuccessful introductions are known as Blank______

blockbusterss

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

concept

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 ______. distribution of product inventory viral marketing the product life cycle diffusion of innovation

diffusion of innovation

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

early adopters

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 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

A company that develops a new merchandise tracking technology that automatically notifies suppliers when a new shipment is needed is using its new product to ______. increase market share identify new target markets improve business relationships eliminate competition

improve business relationships

While the ______ is first to adopt the item, the ______ adopts next.

innovator; early adopter

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

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, ______ who have not yet tried the product or service will be entering the market for the first time. early adopters innovators laggards marketers

laggards

Those consumers who enter the market for the first time during the decline stage are known as ______.

laggards

When the ________________ majority of consumers enters the market, the market has already reached 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

Licensing is a trade-off in that it can save a firm from the high costs of in-house R&D, but instead the firm is counting on a solution (product) that already exists but has not been Blank______.

marketed

During the _________ stage of the product life cycle, the market for the product usually becomes saturated.

maturity

hich of the following industries are most likely to participate in a research consortium? (Choose every correct answer.)

phramaticules and high tech

If a firm has a positive result from the market testing the next step is known as _______________ launch.

product

One advantage of product innovation is that a firm can expand into different product categories. The point of the ______ strategy is that if some products in one category are competing poorly, others in another category could be doing very well. risk diversification risk assimilation risk transfer risk seeking

risk diversification

New product and service innovation is important because the longer a product or service exists in a given marketplace, the more likely that the market will become ______. profitable saturated vacant integrated

saturated

When Subway introduced a new Southwestern Club sandwich in South Florida before launching it nationwide, it was engaging in Blank______.

test marketing

Which of the following is a market testing method that offers a strong predictor of product success based on actual purchasing behavior? Simulated shopping Focus grouping Brainstorming Test marketing

test marketing

When a product is first launched during the introduction stage, sales are usually ______ and there are ______ competitors. high; numerous very low; essentially no profitable; no unprofitable; several

very low; essentially no

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 ______. which group of consumers like the product if the cost of the product is accurate if more prototypes would be beneficial which stage the product is in

which stage the product is in