MGT8803 Exam 5 Marketing

New Product Adoption Process Stages

1. Awareness 2. Interest 3. Evaluation 4. Trial 5. Decision 6. Confirmation

The 5 Stages of New Product Development

1. Idea Generation 2. Screening 3. Idea Evaluation 4. Development 5. Commercialization

Creating differentiation (uniqueness in the minds of the customer) applies specifically to which component(s) of the marketing mix? Check all that apply. Base your answer on class discussion during video conferences. a. Product b. Price c. Place d. Promotion

All Answers Checked

(True/False) Direct channels are rarely used in business-to-business marketing

False

(True/False) Apple selling its Apple Watch product line through the Best Buy "big box" retail chain is an example of an indirect marketing strategy.

True

(True/False) During market introduction a company would usually spend a lot on sales promotion, market research, heavy advertising, and manufacturing

True

(True/False). Consumer product classes are based on how consumers shop for the product

True

(True/False). It's easy to lose money (a loss rather than a profit) using average cost pricing as a mark-up pricing technique if the demand forecast for the product is not highly accurate.

True

Many celebrities are paid to promote products on social media such as Facebook and Twitter. This is an example of: Select all that apply but note there may be only one correct answer. a. Advertising b. Personal selling c. Sales promotion d. Publicity e. Owned media f. Earned media

a. Advertising

New products that are rapidly adopted by customers (e.g. sales are able to ramp up quickly) generally display the following characteristics except a. Are low cost b. Have significant comparative advantages over current products c. Are easy to use and compatible with the values and experiences of the customer d. Can be easily tried and/or tried with little risk to the customer e. The advantages of the new product can easily be communicated or observed

a. Are low cost

Match the product class to the correct description: Purchased immediately when the need is great. Consumers generally don't shop around for these products or ask how much they cost. a. Emergency b. Convenience c. New unsought d. Bargain e. Regular unsought f. Exclusive g. Premium h. Specialty i. Shopping

a. Emergency

Which one of these is NOT an issue of Product Life Cycle Length? a. Greater Product Complexity b. Product Life Cycles are getting shorter c. Fashion and Fads d. First Mover Advantage

a. Greater Product Complexity

A differentiated product may be unique in the marketplace but it will only be successful under which of the following circumstances. a. If it satisfies customer needs b. If the price difference is minimal c. If the brand can be classified as aspirational d. Differentiated products will always be successful

a. If it satisfies customer needs

Which one of the statements is FALSE? a. Marketers should always try to maximize the customer service level provided regardless of cost b. Physical distribution activities are invisible to most consumers—unless something goes wrong c. There are trade-offs between costs, the customer service level desired and sales d. Information technology can help marketers improve service and cut costs. e. In countries with inefficient distribution systems, consumers can face shortages of products they need

a. Marketers should always try to maximize the customer service level provided regardless of cost

Consider both statements. Statement 1. In general the business to business ("B2B") decision-making process is longer and more formal than the business to consumer ("B2C") decision-making process. Statement 2. The emphasis of B2B buying criteria is on psychological benefits of the product or service. a. Only Statement 1 is True b. Only Statement 2 is True c. Both Statements are True d. Both Statements are False

a. Only Statement 1 is True

Which one of the below traditional advertising channels reaches the widest market at the lowest cost? a. Radio b. Direct Mail c. TV and Cable d. Newspaper

a. Radio

Which one of the following is NOT a form of advertising? a. Reactionary b. Institutional c. Competitive d. Reminder e. Pioneering

a. Reactionary

For specialty products that have relatively high demand, a manufacturer is more inclined to use which of the following market exposure strategies? a. Selective b. Inclusive c. Exclusive d. Intensive e. Internet f. Extensive

a. Selective

Fidelity Corp. earned a 6 percent return on investment last year and wants to increase it to 10 percent this year. Which of the following pricing objectives is Fidelity seeking? a. Target Return b. Growth in sales c. Growth in market share d. Maximize profits e. Non-price competition

a. Target Return

Which of the following is a key function of "positioning" in marketing campaigns? a. To provide a reason why the customer should buy the product. b. To divert the customer's attention from the product's flaws. c. To override the customer's previous mindset. d. To distract the customer from considering a competitor's product.

a. To provide a reason why the customer should buy the product.

In which of the following cases will profit be maximized? a. When marginal revenue is equal to marginal cost b. When total cost is nearly equal to total fixed cost c. When total revenue is nearly equal to total cost d. When total variable cost is nearly equal to total fixed cost e. When the break-even point is nearly equal to the average cost

a. When marginal revenue is equal to marginal cost Profit is determined by revenue-cost. To maximize profit, the marginal revenue = marginal cost

A company may be inclined to use both direct and indirect channels of distribution: a. When serving multiple target markets b. When it wants total control over the marketing mix c. When suitable channel partners are hard to find d. When selling to business customers e. When selling to final customers

a. When serving multiple target markets

Which of the following would be a variable in psychographic profiling (developing a customer persona). Check all answers that apply (may be more than one) a. lifestyle b. values c. brand loyalty d. attitudes e. personality f. marital status

a. lifestyle b. values d. attitudes e. personality

Pfizer, Inc. has noticed that in one of its product-markets industry sales have leveled off and competition has been getting tougher. This product- market appears to be in the ____ stage of the product life cycle. a. market maturity b. market introduction c. market growth d. sales decline e. market decline

a. market maturity

Customers remembering messages that are consistent with their beliefs and attitudes, but not remembering those messages that conflict is knowns as: a. selective retention b. selecting perception c. selective exposure d. selective bias

a. selective retention

A marketing strategy: a. specifies a target market and a related marketing mix. b. provides a focused but narrow picture of what a firm will do in some market. c. is a whole-company plan. d. includes two interrelated parts--product mix and product development. e. includes the marketing mix, but does not specify customers.

a. specifies a target market and a related marketing mix.

An individual develops a new type of fishing lure and decides to sell the product at an outdoor show because it will attract a lot of people who enjoy fishing. What type of segmentation is this? a. Geographic b. Behavior c. Psychological d. Demographic e. RFM

b. Behavior

Which of the following is NOT a factor that can affect the choice of segmenting or combining? a. Too much combining can be risky b. Combining implies more marketing costs c. Segmentation can lead to increased sales d. Competition in various segments e. The firm's resources

b. Combining implies more marketing costs

Match the product class to the correct description: Are purchased quickly with little effort. They may be inexpensive, but often require little service and bought by habit. a. Emergency b. Convenience c. New unsought d. Bargain e. Regular unsought f. Exclusive g. Premium h. Specialty i. Shopping

b. Convenience

Place in the 4 "P"s means the same as: a. Promotion b. Distribution c. People d. Service e. Location

b. Distribution: the geographic location of the "place" in marketing mix

Controllable variables that the marketer has to create and harvest demand are referred to as the: a. Competitive Offering b. Marketing Mix c. The 4 C's d. Value Proposition e. The 4 Differentiators

b. Marketing Mix

Consider both statements. Statement 1. When possible using rail service for the transportation of fast moving goods is typically the best option. Statement 2. Storing and holding goods in the firm's warehouses and distribution channel allows producers to take advantage of economies of scale in production. a. Only Statement 1 is True b. Only Statement 2 is True c. Both Statements are True d. Both Statements are False

b. Only Statement 2 is True

Hershey's places a simple ad for its "kisses" chocolates in SPORTS ILLUSTRATED. The ad shows only a photo of the product with no copy words. This is an example of a(n) ________ promotion objective. a. Persuading b. Reminding c. Informing d. Pioneering

b. Reminding

When Apple first introduced its iPhone in the U.S. market, it priced it at $600. Several months later, Apple reduced the price to $400. And several months after that, it reduced the price again to $200. What pricing policy was Apple using in its initial price strategy? a. Introductory price b. Skimming price c. Cash discount price d. Penetration price e. Everyday low price f. Stepped pricing

b. Skimming price

Lever Bros. is introducing a new brand of shampoo in a highly competitive market. Wholesalers might be willing to handle the new product, except that retailers are already complaining about overcrowded shelf space. Therefore, Lever Bros. has decided to spend $10 million on TV advertising and send free samples to 3,000,000 households to convince consumers of the new product's superiority—and to get them to ask for it at their retail store. Lever Bros. is using: a. dual distribution b. a "pulling" policy c. direct marketing d. a "pushing" policy e. a sampling distribution

b. a "pulling" policy

Yamaha North America is planning on launching a new line of Jet Skis called the Double Riders, for the two seats that will come standard with the water craft. The concept is similar to a bicycle made for two. The North America marketing manager is having his direct sales force call on retailers to explain the roll-out strategy (timing, advertising, promotion, marketing collateral) and to hype product features to the firms most important resellers. This is an example of: a. a "pulling" product strategy b. a "pushing" product strategy c. an extensive distribution strategy d. a "short" channel strategy e. a "rolling" product strategy

b. a "pushing" product strategy

What term is used to describe when a customer purchases a product with no planning or forethought? a. spontaneous buying b. impulse buying c. bargain buying d. irrational buying e. unplanned buying

b. impulse buying

When a product is sold in as many outlets as possible a(n) ___________ distribution strategy being used. a. selective b. intensive c. extreme d. exclusive

b. intensive

The choice between high markups and high volume is part of which of the following retailer marketing decisions? a. target market decisions b. pricing decisions c. product assortment and services decisions d. merchandising decisions e. promotion decisions

b. pricing decisions

Major appliances, furniture, and clothing are typical examples of ______ products? a. convenience b. shopping c. specialty d. impulsive e. unsought

b. shopping

A direct-to-customer channel: NOTE: In answering this questions assume that the answer options are in a, b, c, d, e, and f order a. includes a retailer but not a wholesaler. b. usually helps the producer to be more aware of changes in final customer attitudes c. eliminates some of the marketing mix for the firm d. is typical to reach final consumer markets. e. is most suitable when a large number of transactions are required in the channel or when orders are smaller f. Both answers (b) and (c) are correct

b. usually helps the producer to be more aware of changes in final customer attitudes

When should Engineering first get involved in the product development process? a. Screening b. Commercialization c. Idea Generation d. Idea Evaluation e. Development

c. Idea Generation

Ravi Singh is working his way through college as an independent distributor of the Rapier Knife Co. The Rapier product line includes kitchen knives, hunting knives, and other special-purpose cutlery. Ravi makes sales presentations to potential customers in their homes. If a customer wants to make a purchase, Ravi buys the knives from Rapier and sells them to the customer at a markup. For example, Rapier's most popular knife is a chef's knife that Ravi buys for $25 and resells to the consumer for $50. Ravi: a. Is part of a direct-to-customer channel. b. Is engaged in direct marketing c. Is engaged in direct selling, but is part of an indirect channel d. None of these alternatives is correct

c. Is engaged in direct selling, but is part of an indirect channel

Which statements below are an examples of a promotion decision? Choose all that apply. a. Management is deciding whether or not to offer an entire new line of athletic equipment. b. McDonalds conducts extensive research to determine the most cost effective way to transport their products to North American franchisees c. Management is determining which media to use to communicate to customers the release of improved product features in the firm's outdoor kitchen product line d. AMC movie theatres decides to permanently charge a lower admission price on Tuesdays to generate more theatre traffic on its lowest volume day of the week. e. Barnes and Noble recently began airing 30 second television commercials in 12 test cities. f. Management is considering segmenting their market based on demographics and gender g. A supermarket manager decides to set up an end-of-aisle display for 6-pack containers of Gatorade

c. Management is determining which media to use to communicate to customers the release of improved product features in the firm's outdoor kitchen product line e. Barnes and Noble recently began airing 30 second television commercials in 12 test cities. g. A supermarket manager decides to set up an end-of-aisle display for 6-pack containers of Gatorade

Kellogg's Frosted Flakes is a well-known brand that has enjoyed a substantial and loyal following (customers) since 1952. The product has been at the maturity stage for much of its history and product sales keeps pace with the rate of growth of the general population. What kind of ads does Kellogg's typically use to promote this brand a. Persuasive ads b. Informative ads c. Reminder ads d. Pioneering ads e. Nostalgic ads

c. Reminder ads

The total stream of purchases that a customer can contribute to the firm over the length of the firm-customer relationship is referred to as? a. customer whole value b. customer estimated value c. customer lifetime value d. customer satisfaction value e. customer worth

c. customer lifetime value

Developing a promotional campaign for a new product begins with: a. choosing the promotional message b. setting the budget c. determining the promotional objectives d. selecting alternative media e. identifying an endorser or influencer to drive social media f. deciding upon the appeal

c. determining the promotional objectives

What is the first thing a marketer should do to develop a new product or service? a. create a Facebook page b. launch a promotional campaign c. develop an understanding of the customer's needs d. brainstorm new ideas for a product or service e. develop a mockup or prototype

c. develop an understanding of the customer's needs

"Publicity" a. is generally less useful than advertising for promoting a really new product. b. is mass selling that avoids paying media costs c. is any paid form of non-personal presentation of ideas, goods, or services by an identified sponsor. d. is more expensive than all other promotion methods None of these alternatives for "publicity" is true

c. is any paid form of non-personal presentation of ideas, goods, or services by an identified sponsor.

Which one of the following is NOT an advantage of direct distribution channels: a. lower costs b. greater control c. suitable intermediaries d. greater awareness of changes in customer needs e. internet makes it easier

c. suitable intermediaries

Which of the following are the core components of marketing strategy? a. market segmentation, targeting b. differentiation, positioning c. target market, marketing mix d. external market environment, SWOT

c. target market, marketing mix

In an organization (business), significant purchases are often controlled by a "buying center". In a buying center, the group of people whose expertise is needed when buying a product are known as the ___________. a. the economic buyer b. the decision-maker c. the influencers d. the gatekeepers e. the guardians f. the end users g. the authorities

c. the influencers

A marketing manager should realize that the adoption curve concept implies: a. the firm's promotion target should always be the innovators. b. the laggards are cautious, but that they are willing to adopt a new product quickly if advertising gets their attention c. using different promotional mixes for different adopter groups d. the firm's promotion target should always be the opinion leaders e. none of these is a good answer

c. using different promotional mixes for different adopter groups

A marketing manager should realize that the adoption curve concept implies: a. the firm's promotion target should always be the innovators b. the laggards are cautious, but that they are willing to adopt a new product quickly if advertising gets their attention c. using different promotional mixes for different adopter groups d. the firm's promotion target should always be the opinion leaders

c. using different promotional mixes for different adopter groups

Jane and Henry are planning to open a concierge service and are currently debating who shares the need for their service, are willing and able to buy it, and where these people are located. Jane and Henry are debating: a. the definition of customer value and the first value proposition b. drivers of customer satisfaction c. who their target market is d. product and service design e. how they intend to charge for the product/service f. what constitutes an economic exchange

c. who their target market is

Which of the following is not part of the five levels of branding? a. Brand rejection b. Brand recognition c. Brand preference d. Brand domination e. Brand non-recognition

d. Brand domination

Which of the following is a disadvantage of flexible pricing? a. It allows a salesperson to adjust the price in response to competition b. It leaves opportunities for sales by not adjusting to customers c. It allows a salesperson to adjust the price depending on his customer d. It can cause discontent among customers who realize they have paid a higher price than others. e. It results in broadcasting a price that the competition can undercut

d. It can cause discontent among customers who realize they have paid a higher price than others.

Independent wholesalers who own the products they resell are called _______. a. Agent wholesalers b. Brokers c. Retail wholesalers d. Merchant wholesalers e. Dealers

d. Merchant wholesalers

Which of these is a type of unpaid, non-personal presentation of ideas, goods, and services? a. Personal selling b. Advertising c. Sales promotion d. Publicity e. Influencer marketing

d. Publicity

Saxon Shoes is a large independent shoe store. In the men's department, the store offers three different brands of slip-on tassel loafers for men: Bass, priced at $75, Rockport priced at $125, and Allen-Edmonds priced at $250. In terms of product quality, which of the following is an accurate statement? a. The Bass shoes have the lowest quality b. The Allen-Edmonds shoes have the highest quality c. The Rockport shoes have mid-level quality d. The quality of the three brands depends on the degree to which they meet needs of the consumers in the target market e. All of these alternatives are correct

d. The quality of the three brands depends on the degree to which they meet needs of the consumers in the target market

The particular situation a consumer is in during or around the time of purchase can have an effect on the actual purchase. Which of the following is NOT generally considered a key situational influence? a. physical surroundings b. purchase reason c. time available d. beliefs and opinions

d. beliefs and opinions

The marketing manager for a producer of mattresses and box springs distributes its products through discount stores (like Costco), department stores, furniture stores, and specialty bedding stores. To avoid conflict with channel members, the manager: a. should offer purchase discounts based on the quantity of mattresses that the retailer sells. b. assumes that all channel members have a common commitment to target consumers at the end of the channel. c. trusts retailers to emphasize sales of his brand rather than the brand of some other manufacturer d. develops different brands or product lines for different channels. e. expects one of the large retail chains to step up to the responsibilities of being the channel captain.

d. develops different brands or product lines for different channels.

Extreme Boards, a manufacturer of high performance snowboard, carefully developed a strategy for moving into South America. The strategy had poor results after an economic recession rapidly decreased consumer spending in recreational products in most of its South American markets, demonstrating the influence of the _____ on marketing strategy. a. technology b. cultural values c. customer behaviors d. external market environment e. competitive environment f. internal company factors g. government intervention

d. external market environment

The AIDA model consists of four promotion jobs: a. getting Attention, building Intrigue, arousing Desire, and obtaining Action b. becoming Aware, holding Interest, arousing Desire, and providing Assistance c. getting Attention, holding Interest, creating Demand, and obtaining Action d. getting Attention, holding Interest, arousing Desire, and obtaining Action e. becoming Aware, holding Interest, arousing Desire, and obtaining Action

d. getting Attention, holding Interest, arousing Desire, and obtaining Action

E-Z-Go, a producer of golf carts, promotes its carts to prospective customers by advertising them as an easy and quiet way for workers to get around malls, airports, and big factories. E-Z-Go is trying to increase its sales through: a. market penetration b. differentiation c. product development d. market development e. diversification

d. market development

Wizard Toy Company's marketing researcher conducted a survey to find out the percentage of customers who, after receiving a promotional mailing about a new toy, actually went out and purchased the product. This market research survey is an example of: a. a hypothesis b. cross-tabulation c. personal interviews d. quantitative research e. an experimental method

d. quantitative research

Industry profits decline during the market maturity stage due to: a. declining sales b. declining sales and declining costs c. mismanaged budgets d. rising promotion costs and increased competitive pressure to offer product at lowest prices e. new varieties of the original product that fail to meet customer needs

d. rising promotion costs and increased competitive pressure to offer product at lowest prices

A target marketer who uses a single marketing mix strategy to appeal to both office tablet computer users and home tablet computer users is applying: a. the broad market approach b. the single market approach c. the multiple target market approach d. the combined market approach e. the generic market approach

d. the combined market approach

A person who purchases flowers will select different floral arrangements for a retirement party, a funeral, and a Valentine's Day date. This illustrates the impact of _____ on purchase decisions. a. economic needs b. psychological variables c. social influences d. the purchase situation e. extensive problem solving

d. the purchase situation

The breakeven point ("BEP") is the point where: a. total revenue from the quantity sold equals the average unit cost b. total revenue from the quantity sold equals the total fixed costs c. total revenue from the quantity sold equals the total variable costs d. total revenue from the quantity sold equals the total costs e. the quantity at which the incremental revenue from that unit sold exactly equals the incremental cost to produce that unit

d. total revenue from the quantity sold equals the total costs

Average-cost pricing: a. always results in a profit that is less than what was expected b. takes the demand for a product into account c. sets price at the point where average fixed costs is equal to average variable cost d. will lead to losses if actual sales are much lower than expected e. is the only way to ensure that a firm will set a profitable price

d. will lead to losses if actual sales are much lower than expected

The adoption curve shows when

different groups accept ideas

Which ONE of the following is NOT a criteria for determining market segments? a. Members of the segments should be homogeneous along at least one important customer dimension b. The segment should be large enough to be profitable c. The segmenting dimensions should be useful in identifying specific customers and in designing the appropriate marketing mix d. Members of the segment should respond in a similar way to the same marketing offer e. Members of the segment should be in the same socio-economic class

e. Members of the segment should be in the same socio-economic class

Which of the following should not be considered one of the controllable elements in a firm's marketing strategy: a. price selection b. target market selection c. sales force design d. advertising content e. customer behavior f. product features

e. customer behavior

According to Professor Buchanan, probably the most significant factor in influencing consumer purchasing decisions is a. social influence b. purchase situation c. influencer consensus d. technological adoption e. psychological variables f. environmental sustainability

e. psychological variables

In a video conference call we discussed a model of influences on customer behavior that highlighted 4 primary factors: economic needs, psychological variables, purchase situation, and ______________. a. product visibility b. environmental sustainability c. influencer consensus d. technology adoption e. social influence

e. social influence

Informing promotion is often used to _________ for a new product or service offering

educate and inform

Match the product class to the correct description: Products that the consumer really wants and have fewer or no acceptable substitutes. They are characterized by the consumer's willingness to search a. Emergency b. Convenience c. New unsought d. Bargain e. Regular unsought f. Exclusive g. Premium h. Specialty i. Shopping

h. Specialty

Match the product class to the correct description: Are compared with competing products; products considered as either Homogeneous (decision based on price) or Heterogeneous (decision based on suitability) a. Emergency b. Convenience c. New unsought d. Bargain e. Regular unsought f. Exclusive g. Premium h. Specialty i. Shopping

i. Shopping

To maximize profit ____ must equal _____

marginal revenue must equal marginal cost

Average cost pricing will lead to losses is actual sales are _______ than expected

much lower

Profit is determined by ______ minus _______

revenue minus cost