Marketing final #9

You are a product manager for a manufacturer of detergent. You have determined that detergent is in the mature stage of the product life cycle. To keep your product from entering the decline stage, what should you do? a. Promote detergent heavily to dealers and customers. b. Use promotion to increase primary demand for detergent. c. Raise the price of the detergent because customers are not price sensitive in this stage. d. Abandon peripheral target markets for detergent.

A

high

Premium pricing can also be used to improve brand identity in a particular market. This is called price-quality signaling, because the high price signals to consumers that the product is-- in quality.

innovation

A product that is perceived as new by a potential adopter, whether the product is "new to the world" or simply new to the individual, is a(n) a. innovation b. diffusion c. discontinuous product d. laggard

What is one way to determine whether a company has a balanced portfolio of products and, if not, what new product ideas are needed to offset the imbalance? a. research ombudsmen b. internal product development venture teams c. outside consultants d. marketing development departments

C

What is the final stage in the new-product development process? a. product testing b. simulated marketing c. commercialization d. market testing

C

c. develop every product for potential worldwide

50. The main goal of the global product development process is to: a. come up with a single standard product or product line suitable for all global markets b. expand the number of different new-product offerings so that individual country needs are more likely to be met c. develop every product for potential worldwide distribution and adaptation to other coun-tries d. come up with new-product ideas in the United States and use global markets as test mar-kets e. repeat the steps in the process with marketing teams in each and every foreign country tar-geted ANS: C Multinational companies develop each product for potential worldwide usage, with minor unique re-quirements incorporated. PTS: 1 REF: 396 OBJ: 11-4 TOP: AACSB Reflective Thinking MSC: BLOOMS Level IV Analysis

The marketing manager for a company that manufactures pet foods wants to base the marketing strategy he implements for the company's products on the product life cycle stages. In order to do this, what should he do? a. Add new ingredients to products that enter the maturity stage of the produAct life cycle. b. Change all private brands to generic brands once a product reaches the maturity stage. c. Create a line extension for every product the company makes as soon the product leaves the introduction stage of its product life cycle. d. Change the labels on its products as they change stages of the life cycle.

A

The advertising strategy during the growth stage of the product life cycle should be to do what? a. make the mass market aware of brand benefits b. emphasize the product's low price to help reduce inventories c. use advertising as a vehicle for introducing the product category benefits d. make the market aware of product category brands

ANS: A During growth, the competition has appeared, and advertising should emphasize brand differences.

Which of the following products is most likely to be in the decline stage of its product life cycle? a. prerecorded audiocassette tapes b. programmable CD-ROMs c. wireless mobile phones d. sports drinks

ANS: A Its sales are falling and the product is not being supported by marketing efforts even though there are still some computers that can use that size diskette.

The rate of sales decline during the decline stage of the product life cycle is largely governed by which of the following? a. the number of competitors in the market b. how rapidly consumer tastes change or substitute products are adopted c. the intensity of the competition's marketing efforts d. the amount of money spent on advertising

ANS: B Changing consumer tastes can force a product into decline, particularly if an alternative is available.

What happens during the maturity stage of the product life cycle? a. Profit margins are at their peak. b. Promotion to the dealer is often intensified. c. More shelf space is made available to the product. d. Product lines are narrowed.

ANS: B In maturity, one of the only ways to fuel an increase in sales is to push more products to the dealer.

The length of the introductory stage of the product life cycle for a new product is largely determined by which of the following? a. the efficiency of the test marketing b. the product's marketing mix c. product characteristics, such as advantages over substitute products d. the size of the product

ANS: C The introductory stage of the product life cycle is affected by how customers perceive the characteristics of the product. Other factors that affect the length of the introductory stage are the educational effort required to use the item and management's resource commitment to the item.

Ortho Products would like to estimate the length of time that its new product, the Sonar Brush (cleans teeth without touching them), will stay in the introductory phase of its product life cycle. What do you tell management? a. Time is largely determined by the income level of its target markets. b. Time is largely determined by the political and legal environment. c. Time is largely determined by the level of relative advantage over what is currently being used. d. Time is largely determined by the general economic environment.

ANS: C The relative advantage is the degree to which a product is perceived to be superior to existing substitutes.

Marketers consider all of the following examples of new products EXCEPT which one? a. the addition of an investment service to a company that once specialized in insurance b. a new flavour of Jell-O gelatin c. a new low-fat formulation for Campbell's soup d. a 2008 model-year GE dishwasher with the same style, parts, and colour as the 2007 model

ANS: D All these are new products except the new model year with no other changes than the date.

What is the phase of the product life cycle in which healthy profits usually begin to appear? a. introductory b. decline c. maturity d. growth

ANS: D Because losses often occur during the introduction stage, profits first appear in the growth stage.

Otto-Light is a desk light that lets hobbyists match colour swatches accurately without going outside. It's like convenient, natural sunlight inside. The lights have high marketing costs, are sold with high dealer margins, and have high production costs. Ads for the product aim at educating craftspeople who work with fabrics and paints about the benefits of the Otto-Light. In which stage of the product life cycle is the light? a. saturation b. decline c. growth d. introductory

ANS: D These characteristics illustrate the introductory stage of the product life cycle.

Which stage of the product life cycle would feature very high promotional expenditures in an attempt to create customer awareness? a. maturity b. introduction c. growth d. decline

B

A global organization that ―thinks local, act local‖ does which of the following? a. adopts a policy of international standardization b. does not engage in product line extension in countries where existing products are well received c. gives country managers more autonomy in new-product development d. adheres to a sales orientation

C

A long-run drop in sales signals the beginning of which stage in the product life cycle? a. saturation stage b. laggard stage c. decline stage d. decay stage

C

Among the late majority group, what does adoption of a product primarily result from? a. broadcast advertising b. advertising in nontraditional media c. word-of-mouth advertising d. sales promotions

C

Laptop computers, pet food, cake mixes, DVDs, and recreational vehicles are examples of what? a. brand classes that satisfy a particular type of need b. line-extendable categories that satisfy a particular type of need c. product categories that satisfy a particular type of need d. product life cycle line items that satisfy a particular type of need

C

What happens toward the end of the growth stage of the product life cycle? a. There is little emphasis on the distribution strategy. b. Demand for the product is limited to high-income consumers. c. Profits peak. d. There is decreased direct competition.

C

A company that manufactures mantels, stairways, doors, windows, and other architectural reproductions brought together a group of 10 recent customers and asked them to discuss what they liked and disliked about the current designs marketed by the company. Which of the following research techniques did the manufacturer use? a. a venture team b. a buying centre c. brainstorming d. a focus group

D

According to the text, which of the following statements about the product life cycle is true? a. The product life cycle concept encourages marketing managers to think reactively. b. Almost all sales in the intro and growth stages of the product life cycle represent repeat purchasing. c. The relationship between the laggard category and the stages of the product life cycle are well understood. d. The product life cycle is especially useful as a forecasting tool.

D

Firebrand Technologies has been researching and developing a revolutionary product in its company labs for the past five years. The company has just finished developing a cigarette that is smokeless and contains no nicotine. Firebrand is looking forward to a very profitable product launch. What stage of the product life cycle is the company in? a. development b. growth c. maturity d. introduction

D

Post has been manufacturing and marketing breakfast cereals for over 100 years. It spends much of its marketing budgets on short-term promotions aimed at stealing market share from General Mills and other cereal manufacturers. From this information, you should know that cereals are in the which stage of their product life cycle? a. development b. growth c. decline d. maturity

D

What occurs when an existing product is targeted toward new market segments? a. brainstorming b. screening c. reciprocity d. repositioning

D

Which of the following are eager to try new ideas and products, typically have higher incomes, are better educated, and are more cosmopolitan than other categories of adopters? a. early majority b. late majority c. early adopters d. innovators

D

a. a good match between the product and market needs

The MOST important factor in successful new-product introduction is : a. a good match between the product and market needs b. strong company leadership c. an obsession with quantity rather than quality d. a project-based team approach to new-product development e. a history of carefully listening to customers ANS: A All of the factors listed are important, but the most important is a good match between the product and market needs—as the marketing concept would predict. PTS: 1 REF: 395 OBJ: 11-3 TOP: AACSB Reflective Thinking MSC: BLOOMS Level IV Analysis

commercialization,

The final stage in the new-product development process is -- the decision to market a product. The decision to commercialize the product sets several tasks in motion:

Typically, at the beginning of the maturity stage of the product life cycle, what happens to sales? a. They decrease at an increasing rate. b. They increase at an increasing rate. c. They increase at a decreasing rate. d. They become flat and do not change.

c

When a consumer makes a trial purchase of a new product, what does he or she become in the new-product adoption-stage process? a. a diffusion user b. an adopter c. an inventor d. a laggard

ANS: B A trial purchase does not make a consumer an adopter. Satisfaction and continued usage are required to make a consumer an adopter.

At what stage of the new-product development process are most new product ideas rejected? a. test marketing b. idea generation c. idea screening d. diffusion

ANS: C Screening is the stage when the bulk of the ideas are rejected for being incompatible or impractical.

In which stage of new-product development are preliminary demand, cost, sales, and profitability estimates made? a. business analysis b. prototype screening c. concept testing d. idea generation

A

A company finds out that members of its target market are likely to collect more information and evaluate more brands than early adopters. These people are cautious and thoughtful and do not try the product without asking someone else. The customers' dominant characteristic is deliberateness. In terms of the diffusion process, these customers are most likely in which group? a. laggards b. early minority c. late majority d. early majority

ANS: D The early majority will collect more information and evaluate more brands than do early adopters. They rely on friends, neighbours, and opinion leaders for information and norms.

Franco likes to be ―cutting edge‖ with respect to new trends but carefully researches the Web for anticipated benefits of consumption from peers and checks out competitive offerings before committing to purchase. Franco is in which of the following groups? a. innovators b. early majority c. late majority d. early adopters

B

In terms of categories of adopters, those who take on the role of opinion leaders in their community are typically found within which group? a. early majority b. early adopters c. innovators d. late majority

B

c

Which of the following is the most important factor in successful new-product introduction? a. The features of the new product should be similar to its substitutes in the market. b. The product should not be developed using crowdsourcing. c. The new product should be priced lower than other products in the same category. d. The new product should deliver a meaningful and perceivable benefit to a sizable number of people.

What is the spread of a new idea from its source of invention or creation to its ultimate users or adopters? a. diffusion b. transmission c. dispersion d. circulation

A

Which of the following sources is a source for new product ideas? a. employees b. government agencies c. former customers d. foreign distributors

A

In the adopter categories, the final 16 percent to adopt are similar to innovators in that they do not rely on the norms of the group but are independent because they are tradition-bound. They tend to have the lowest socioeconomic status, are suspicious of new products, and are alienated from a rapidly advancing society. Who are they? a. laggards b. decliners c. late majority d. late diffusers

A

One of the following typically entails showing members of the product's target market advertising and other promotional materials for several products, including the test product. These people are then taken to a mock or real store where their purchases are recorded. Which of the following is being described? a. simulated (laboratory) market test b. adoption-rate test c. concept test d. consumer juried test

A

The development stage of the new-product development process works best when which of the following is practised? a. simultaneous product development b. competitive product equity c. the new-product paradigm d. test marketing

A

Until the mid-1990s, MGP Ingredients, Inc. sold ethanol and animal feed. A steep drop in its sales led the company to focus on developing the first low-carb proteins and starches. What would these low-carb proteins and starches be an example of? a. an addition to an existing product line b. a revision to existing products c. a repositioning strategy d. a new product line

A

What is a limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation? a. test marketing b. laboratory testing c. use testing d. concept testing

A

What is a product that is perceived as new by a potential adopter, whether the product is ―new to the world‖ or simply new to the individual? a. an innovation b. a diffusion c. a simulated new product d. a laggard

A

During which stage of the new-product development process does production start, inventories are built up, the product is shipped to distribution points, the sales force is trained, and advertising and promotion begin? a. product testing b. product prototyping c. commercialization d. simulated marketing

C

What does a new-product strategy do? a. specify the roles new products play in the organization's annual meeting b. link the new-product development process with the objectives of the finance department, the business unit, and the corporation c. describe the characteristics of products the organization wants to offer and the markets it wants to serve d. act as part of an organization's overall financial strategy

C

Companies that are most likely to succeed in the development and introduction of new products typically do which of the following? a. use an industry-specific approach that is driven by corporate objectives and strategies with a we-defined new-product strategy at its core b. capitalize on youth and creativity to achieve and maintain competitive advantage c. make the short-term commitment needed to support innovation and new-product development d. establish an environment conducive to achieving new-product objectives

D

New-to-the-world products, where the product category itself is new, are also called which of the following? a. moderate innovations b. creative offerings c. venture products d. discontinuous innovations

D

Which of the following is a type of scientific investigation aimed at discovering new technologies? a. product development b. concept testing c. applied research d. basic research

D

Which of the following is a characteristic that would slow the rate of adoption of new products? a. product complexity b. high compatibility with existing products c. relative advantage over substitute products d. an opportunity to try out the product

ANS: A Products that are compatible with others will gain from existing product knowledge, past experiences, and correct needs.

Zippysnacks has come up with a new potential product, chocolate-covered jalapeno peppers, and is now asking potential customers, ―Would you buy this snack?‖ Zippysnacks is asking this question of potential customers in which of the following? a. prototype screening b. concept testing c. market testing d. the product development stage

B

What can the marketers of consumer products expect to find when they study and apply the product life cycle theory to their products? a. Changes in a product can change its life cycle. b. The theory helps to predict how long a firm will stay in each stage. c. The lengths of time that products stay in any one stage is standardized for consumer products, but not industrial products. d. All products except those considered faddish go through every stage.

ANS: A If a firm changes a feature of the product, it could move into another product life cycle stage.

Christian Kniski has developed a new technology that uses miniature computerization to analyze DNA specimens. His next step after developing the product should be to work to find an application for this new technology through which of the following? a. applied research b. product development c. concept testing d. basic research

ANS: A Applied research takes new technologies and attempts to find useful applications for them.

What is a process where a group thinks of as many ways as possible to vary a product or solve a problem without considering the practicality of the ideas? a. new-product brain dumping b. diffusion c. brainstorming d. screening

C

What is the first filter in the new-product development process that serves to eliminate new product ideas that are inconsistent with the organization's new-product strategy or are obviously inappropriate for some other reason? a. business analysis b. applied diffusion c. idea screening d. test marketing

C

Which of the following products has the lowest level of trialability? a. green-tinted light bulbs b. low-carb yogurt c. a new reality-based television show d. orthodontic braces

ANS: D Trialability is the degree to which the product can be tried on a limited basis. Braces cannot be.

Normally, what is the longest stage of the product life cycle? a. introduction b. maturity c. decay d. growth

B

Why do profits increase during the growth stage of the product life cycle? a. Distribution intensity is increasing. b. Competitors have arrived and revenues are under pressure. c. Competition has not yet taken away company sales. d. Prices charged increase during the growth stage.

C

Zippy Construction Ltd. has been experiencing extremely tough competition in recent months for its specialty housing components. Fred Farkle, President of Zippy Construction, was reading the latest industry statistics on overall sales of specialty components and noted that revenues had plateaued. It is likely that Mr. Farkle was facing which stage of the product life cycle? a. maturity b. introduction c. growth d. decay

A

Until the mid-1990s, MGP Ingredients sold ethanol and animal feed. A steep drop in its sales led the company to focus on developing the first low-carb proteins and starches. The company was able to use existing manufacturing equipment to develop these food additives in response to the growing popularity of the Atkins Diet and similar food regimens. The realization that MGP could use the popularity of the Atkins Diet as a catalyst for success would have occurred in which stage of the new-product development process? a. developing a business analysis b. establishing the new-product strategy c. exploring opportunities d. screening and concept testing

D

What is the name for a consumer who was sufficiently satisfied with his or her trial experience with a product to proceed with some further usage? a. an opt-in buyer b. an innovator c. an adopter d. a diffuser ANS: C OBJ: 5

C

Scientists at University of Toronto are working to develop new technologies for customer interface interactions in retail stores. Right now they are not concerned with the potential cost-effectiveness of the technologies or the marketability of the technologies. What are these scientists involved in? a. basic research b. applied research c. brainstorming d. product generation

ANS: A Basic research is scientific research aimed at discovering new technologies.

The maker of Skittles candy kitchen tested and prepared hundreds of batches of candy for taste-testers, who were employees of the company. The taste-testers were instructed to identify the best formula for mint-flavoured Skittles. This was an example of what type of test? a. laboratory b. concept c. diffusion d. market

ANS: A Laboratory tests are conducted on prototype products during the development stage.

Stouffer's added 25 percent more meat to its Lean Cuisine Skillet Sensations meal-in-a-bag. The addition of more meat made the product acceptable to men as well as women and expanded its target market. What is the meatier Lean Cuisine Skillet Sensations an example of? a. a repositioned product b. a discontinuous innovation c. a new product line d. an addition to a current product line

ANS: A The meal-in-a-bag was modified to appeal to a new target market.

When Forrest Event Marketing, Inc. started searching for new product ideas, a marketing consultant suggested a variety of sources of information. Which is the LEAST likely source of new product ideas? a. its employees b. its competitors c. its customers d. its financial lenders

ANS: D Customers, employees, distributors, and competitors are interacting with the marketplace and may have ideas for goods to serve customer needs. The bank from which it gets its debt financing is the least likely alternative here.

In which stage of new-product development is the technical feasibility of manufacturing the new product examined as a prototype is produced? a. concept testing b. screening c. market testing d. development

ANS: D During the development stage, the technical feasibility of manufacturing the product at a reasonable cost is thoroughly examined. This stage can be long and expensive and can involve a great deal of testing. Products are often modified after the testing.

When Sherwin Williams began selling Martha Stewart-designed paints, what could the approach be classified as? a. a repositioning strategy b. a revision to existing products c. a new product line d. an addition to an existing product line

ANS: D These are new products that supplement, not replace, a firm's established line.

A hospital created a focus group to identify new products that it believed would enhance the boomers' aging process. This focus group most likely contained which of the following? a. members of other hospitals b. health care providers c. a sampling of all stakeholders from the sponsoring hospital d. people who would be categorized as baby boomers

ANS: D To be useful, focus groups should contain people who are most directly affected by the focus group's outcome.

What links the new-product development process with the objectives of the marketing department, business unit, and corporation? a. a concept test b. a new-product strategy c. a product strategy bridge d. a product-review committee

B

Old Oscar's favourite expression is, ―Old ways is best ways.‖ Oscar was recently told by a couple of his friends that he was becoming out of fashion with regard to his video viewing habits. Reluctantly, he just purchased a DVD player and has considered converting his massive VHS cassette collection to DVD. In terms of adopter categories, where would Oscar fall? a. early majority b. late majority c. early adopters d. laggards

B

One manufacturer produces Hanes, Playtex, and Bali clothing for women. This manufacturer assembled a group of nine regular customers and asked them to discuss what they like and do not like about its current product line for full-figured women and to suggest new product ideas, such as jewellery, shoes, and belts. Which research technique was the manufacturer using? a. a venture team b. a focus group c. a product-review committee d. a brainstorming session

B

Reginald was happily jogging up the street in his florescent green jogging shorts while listening to his favourite cassette, ―The Best of Anne Murray,‖ in his Sony Walkman. Seeing a bus go by with a sign that claimed ―iPhone is THE way,‖ Reginald snorted, ―That'll be the day.‖ Reginald belongs to which adopter group? a. early adopters b. laggards c. late majority d. early majority

B

What goes one step further than applied research by converting new technology applications into marketable products? a. marketing development b. product development c. basic research d. product modification

B

Which of the following evaluate new product ideas usually before any prototype has been created? a. simulated market tests b. user tests c. concept tests d. market tests

C

Those who embrace products relatively early in the product life cycle, are likely to be community oriented, and often are opinion leaders themselves are referred to as which of the following? a. late majority b. laggards c. innovators d. early adopters

D

A manufacturer of athletic equipment is finding it difficult to compete with cheaper imported merchandise. Which of the following is a potential source of new product ideas? a. the company's former employees b. customers who have requested its catalogues c. current retailers that owe the company money d. its foreign suppliers

ANS: B Customers are in the marketplace and may have ideas for goods to serve customer needs.

Parris Laboratories has ordered production materials and equipment needed to make its new slow-release chlorine emulsion for swimming pools in its Rossville plant. Which stage of new-product development is Parris Laboratories entering? a. diffusion analysis b. commercialization c. product prototyping d. business analysis

ANS: B During commercialization, production materials and equipment are ordered.

What is the first stage of the new-product development process? a. establishing the new-product strategy b. exploring opportunities c. developing a business analysis d. building of a prototype

ANS: A New-product strategy is the first subset of the organization's new-product development plan. It specifies what roles new products play in the organization's overall plan and describes goals.

Who adopt a product because most of their friends have already done so, and their adoption is usually the result of pressure to conform because they rely on group norms? a. late majority b. innovators c. early majority d. laggards

A

For years many people perceived it as difficult to tape programs on video cassette recorders (VCRs). They could not master the multiple programming steps. As a result, makers of VCRs streamlined the system. To tape a show, all the user needed was a program number available in TV Guide. Makers of VCRs realized that which product characteristic was slowing sales? a. complexity b. trialability c. compatibility d. relative advantage

ANS: A Complexity is the degree of difficulty in understanding a product.

The maker of Lysol disinfectant tested consumers' reactions to the company's Lysol Sanitizing Wipes by getting consumers to look through a newspaper with grocery store ads, make out a grocery list, and then ―shop‖ in a mock store filled with real products, including the new cleaning product. What is this an example of? a. a simulated (laboratory) market test b. a use test c. an adoption-rate test d. a concept test

ANS: A Simulated (laboratory) market tests typically entail showing members of the target market advertising for a variety of products, and then monitoring purchase behaviour in a mock or real store.

Because Laurence did not know companies sold pet insurance so that owners could pay for operations on their pets in the event of a sickness or accident, he paid almost $4,000 to have his dog's broken hip replaced. Once he discovered that such a product existed, what did he perceive the insurance to be? a. a diffusion b. an innovation c. a product diversification d. a market laggard

ANS: B An innovation is a product perceived as new by a potential adopter.

Scientists at University of Toronto have received a patent for their newly discovered technologies for more effective customer interface interactions in retail stores. The university decided to sell the patent to an independent company whose scientists immediately began exploration into practical uses of this new technology. What are the scientists at the independent company involved in? a. product development b. applied research c. brainstorming d. basic research

ANS: B Applied research takes new technologies and attempts to find useful applications for them.

Mosaic Labs has developed a chemical compound that prevents mildew in even the most humid climates. The week after the compound was invented, a group of the firm's employees got together and listed ways the product might be used. What is this an example of? a. focusing grouping b. brainstorming c. venture group activities d. screening

ANS: B Brainstorming is a process where a group thinks of as many ways to vary a product or solve a problem as possible without considering the practicality of the ideas.

What is the screening and concept testing stage of the new-product development process used to do? a. refine the promotion campaign to be used with the new product b. eliminate undesirable ideas and predict consumer acceptance c. determine the potential profits to be gained from the new product d. generate new product ideas

ANS: B Concept tests involve describing the product idea to consumers, usually before any prototype has been created, and asking for their evaluations.

After the research team at DairyMade had generated more than two dozen new product ideas for a substitute for coconut that tastes the same but has zero fat, the company formed a committee to analyze whether the product ideas were consistent with the organization's new-product strategy. What is this called? a. diffusion b. idea screening c. idea generation d. test marketing

ANS: B Idea screening is the first filter in the product development process. It serves to eliminate new product ideas that are inconsistent with the organization's new-product strategy.

What is the main goal of the global product development process? a. to expand the number of different new product offerings so that individual country needs are more likely to be met b. to develop every product for potential worldwide distribution and adaptation to other countries c. to come up with a single standard product or product line suitable for all global markets d. to repeat the steps in the process with marketing teams in each and every foreign country targeted

ANS: B Multinational companies develop each product for potential worldwide usage, with minor unique requirements incorporated.

1. When the manufacturer of Pine-Sol cleaning liquid introduced an orange-scented cleaner, which of the following occurred? a. The product was easily sold to many foreign countries using the same, popular Pine-Sol brand name. b. The product was a new product because it was an improvement or revision of an existing product. c. The product was not accepted well in the market until a personal selling campaign was launched. d. The product was not considered new, because the product was not discontinuous.

ANS: B New products can be improvements or revisions of existing products.

A personal care item such as a new flavour of dental floss may have a slow rate of adoption because it is not a highly visible item in homes. Also, this item is not often discussed among friends and coworkers. This is an example of how which characteristic can work to slow the adoption process? a. relative advantage b. observability c. compatibility d. trialability

ANS: B Observability refers to the degree to which the benefits or other results of using a product can be observed by others and communicated to target customers.

Top managers at a company that publishes regional magazines considered making maps, but then decided maps were not within the company's corporate mission. Which stage of the new-product development process did its new-product development process reach? a. business analysis b. idea screening c. idea generation d. customer testing

ANS: B Screening involves rejecting products that don't fit with company plans.

Sara Lee, the maker of Ball Park sausages, has decided to introduce its new Ball Park hot dog buns in a limited market consisting of only four cities and to closely monitor the reactions of potential customers to the product and marketing program. What is Sara Lee using? a. profitability analysis b. test marketing c. market development analysis d. discontinuous innovation

ANS: B Test marketing is a limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation.

When selecting a test market city, what should a researcher look for? a. a city where there is no competition b. a city where the demographics and purchasing habits mirror the overall market for the product c. a city that is as large as possible d. a city that has media spillover from other cities to increase media alternatives

ANS: B Test marketing is a limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation. The market city should be similar to the overall market for accuracy of results.

Which of the following has been found to be an efficient substitute for traditional methods of conducting test markets? a. market concentration b. on-line test marketing c. product sampling d. simulated product adoption

ANS: B The text describes the activities of P&G, Quaker Oats, General Mills, and other companies that use on-line test marketing.

Which of the following statements about how adopters participate in the diffusion process is FALSE? a. Innovators are the first to purchase a new product. b. There are three categories of consumers who will adopt computer products. c. The dominant characteristic of members of the late majority is skepticism. d. Laggards are the last consumers to adopt a new product.

ANS: B There are five categories: innovator, early adopter, early majority, late majority, and laggard.

Many product failures such as cucumber antiperspirant spray, Toaster Eggs, and Health-Sea sea-sausages did not succeed because they did not conform to which product characteristic? a. trialability b. compatibility c. observability d. complexity

ANS: B These products failed because they were not compatible with existing products and because customers could not relate to them.

in the long run, products fail because of a poor match between which of the following? a. prices and consumer demand b. product characteristics and consumer needs c. advertising and personal selling d. the marketing mix and physical distribution

ANS: B This poor match is a violation of the marketing concept, which focuses on serving customer needs with the product.

Landingham Laboratories has decided to introduce its new over-the-counter antibiotic for ear infections in a limited market consisting of only two cities, and to closely monitor the reactions of potential customers to the product and its marketing program. What is this called? a. dual distribution b. laboratory testing c. test marketing d. use test

ANS: C A test market is a limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation.

The maker of Peter Pan peanut butter has developed a honey-flavoured peanut butter spread to add to its peanut product line. Is this a new product? a. Yes, this is a discontinuous innovation. b. No, peanut butter cannot be considered an innovation. c. Yes, additions to the product line are new products. d. No, this is not a product improvement.

ANS: C An addition to the existing product line is considered a new product by marketers.

When Banquet made its chicken patties 20 percent larger to provide greater value to the consumer, it was not trying to reach a new target market. What has Banquet created? a. an addition to an existing product line b. a discontinuous innovation c. an improved product d. a repositioned product

ANS: C Banquet improved an existing product.

Firms that routinely experience success in new-product introduction tend to have which of the following? a. figurehead leadership b. an obsession with quantity rather than quality c. a vision of what the market will be like in the future d. a history of a sales orientation

ANS: C Firms that routinely experience success in new-product introduction tend to have strong leadership, a history of customer orientation, and an obsession with producing the very best product possible.

Razor scooters gained instant popularity because walkers and runners frequently saw people on the scooters zipping by them and it looked like the users were having fun. This information suggests the adoption rate of the Razor scooter was most affected by which product characteristic? a. relative advantage b. complexity c. observability d. compatibility

ANS: C Observability refers to the degree to which the product benefits can be observed.

According to the text, which of the following statements about simultaneous product development is true? a. All departments within the company work together at the same time, but to maintain a high level of secrecy, no one outside the company is involved in simultaneous product development. b. Simultaneous product development actually increases the length of time it takes to get a product to market and the time the product will stay in the growth stage of its product life cycle. c. With simultaneous product development, all relevant functional areas and outside suppliers participate in all stages of the new-product development process. d. Simultaneous product development refers to the practice of developing multiple new products at the same time.

ANS: C Suppliers are typically involved in the process, which shortens the length of time it takes to get a new product to market.

According to the text, which of the following statements about the product life cycle is true? a. Marketers do not yet understand the relationship between the adopter categories and the stages of the product life cycle. b. The product life cycle concept encourages marketing managers to think reactively. c. The product life cycle is especially useful as a predicting tool. d. Just as there are five adopter categories, there are five product life cycle stages.

ANS: C The product life cycle concept encourages marketing managers to think proactively. Almost all sales in the maturity and decline stages of the product life cycle represent repeat purchasing. The relationship between the adopter categories and the stages of the product life cycle are well understood. The product life cycle has four stages.

The process by which the executives at a large company learned about a company called 25th Hour that provides personal assistants who will run errands for $17 per hour is an example of which of the following? a. a product dissemination b. a diffusion c. marketing communications d. an innovative dispersal

ANS: C marketing communications

After Mattel evaluated many new products to add to its Barbie product line and before any prototype was created, the toy manufacturer instructed a committee to select three of the ideas to present to a group of consumers. The consumer group was asked to evaluate the three product ideas in terms of their marketability. What is this stage of new-product development? a. market testing b. prototype screening c. idea manipulation d. concept tests

ANS: D Concept tests evaluate new product ideas usually before any prototype has been created.

When does absolute failure occur? a. when the company prices the product to indicate that it is of the highest quality b. when there is too much synergy between the marketing and production departments c. when products deliver a meaningful and perceivable benefit d. when a company cannot regain its development, marketing, and production costs for a new product

ANS: D Failure does not occur from relativizing price and quality.

What takes new technologies and attempts to find useful applications for them? a. brainstorming b. applied research c. product development d. basic research

B