MKTG Ch. 12
Which of the following is the best example of a functional modification?
A smoke alarm is modified to be more sensitive to smoke at farther distances.
During which stage of new-product development does the firm consider profitability?
Business analysis
Karla tells Jeff that she likes his team's idea about a new three-lace running shoe but wants him to put together some figures regarding anticipated sales, costs, and resulting profits. She is asking Jeff to proceed to which stage of the new-product development process?
Business analysis
Which of the following is the stage of the new-product development process where customers are first exposed to the new product idea?
Concept testing
Which of the following phases of new-product development is likely the least costly for the firm?
Concept testing
___________ and ___________ are important characteristics of quality for consumer markets, and ___________ and ___________ are important characteristics of quality for business markets.
Ease of maintenance/company reputation; durability/technical suitability
T F A runout approach to product deletion lets the product decline without changing the marketing strategy
F
T F Concept testing gives reliable feedback, but at a relatively high cost.
F
T F Concept testing presents a small sample of potential buyers with a trial version of the new product to determine their initial reactions.
F
T F Delivery, installation, financing, repair, warranties, and guarantees are all examples of product features.
F
T F Firms marketing a quality product that generates strong sales can afford to keep expenses down by eliminating new-product development.
F
T F Functional modifications make an existing product more durable.
F
T F Line extensions are less common than other new products because line extensions are more expensive and more risky.
F
T F New products are classified solely as innovations that have never been sold by any organization.
F
T F New-product development does not include planning for advertising.
F
T F Product design is the process of creating and designing products so that consumers perceive them as different from competing products.
F
T F Product managers are most useful in the development of new products.
F
T F Product support services are important mainly for products that are mechanical in nature.
F
T F Quality modification of an existing product aims at changing the product's safety, convenience, or versatility.
F
T F Quality modifications never seek to reduce product quality.
F
T F Sales personnel are an external source for new product ideas.
F
T F Test marketing is an extension of the product screening process.
F
T F Test marketing should be conducted when a product has been given a low probability of success.
F
T F The concept of product quality is the same from consumer to consumer and from consumer markets to organizational markets.
F
T F The decision to drop a product should always be a unanimous decision of the management team.
F
T F The dropping approach to product deletion generates a sales spurt just before removing the product from the market.
F
T F The majority of new-product projects initiated by major companies reach the commercialization stage.
F
T F The phase-out approach to product deletion exploits any strengths left in the product.
F
T F The phase-out approach to product deletion involves a process of continuous price increases to make as much profit as possible before the product is finally priced out of existence.
F
T F Venture team members usually come from the same functional areas within the firm.
F
When marketers at Nabisco meet to identify the types of snacks that young people want, they are engaging in which phase of new-product development?
Idea generation
Which of the following is a disadvantage of gradually introducing a product to market?
It allows competitors to monitor the results of the new product.
__________ is the development of a product that is closely related to one or more products in a firm's existing product line but is designed specifically to meet somewhat different customer needs.
Line extension
As Justin works on the prototype of a new action-oriented computer game, he is engaging in which phase of the new-product development process?
Product development
Ideally, test marketing should follow which stage in the new-product development process?
Product development
Which of the following types of product modifications inevitably tend to cause firms to reduce costs in some of the organization?
Quality
A group of managers has been assigned the task of developing a new product, has listed several good ideas, and is now in the process of assessing each idea to determine whether it is consistent with the firm's overall objectives and resources. The managers are at what stage of the new-product development process?
Screening
What step in developing new products involves determining whether the product idea is compatible with company objectives, needs, and resources on a general level?
Screening
Which of the following is the best definition of product features?
Specific design characteristics that allow a product to perform certain tasks
T F A brand manager is a type of product manager.
T
T F A venture team has the authority to execute plans for the development of products.
T
T F An important question in the business analysis stage of new-product development is, "Will this product meet our profit goal?"
T
T F Automobile makers rely heavily on aesthetic modifications.
T
T F Brand and product managers operate cross-functionally
T
T F Business analysis provides a tentative sketch of a product's profitability.
T
T F Consistency of product quality means giving consumers the quality they expect every time they purchase a product.
T
T F Designing a product that customers perceive as different from competing products is an example of product differentiation.
T
T F During the commercialization phase of new-product development, plans for full-scale manufacturing and marketing are refined and settled.
T
T F Estimates of sales are an important component of business analysis.
T
T F Functional modifications help an organization achieve and maintain a progressive image.
T
T F Functional modifications usually require that the product be redesigned.
T
T F How a pair of jeans looks, regardless of the price, is an example of styling
T
T F If you buy McDonald's French fries in Fort Collins, Colorado, and later buy McDonald's French fries in College Station, Texas, you expect them to be of the same quality. This is referred to consistency of quality.
T
T F Many of the so-called new products that are launched each year are in fact line extensions.
T
T F Product managers can be responsible for a single product, a product line, or several products.
T
T F Relatively few product ideas are put into the product development stage
T
T F Systematic reviews of a company's product mix aid in determining when product deletion is necessary.
T
T F Test marketing is a sample launching of the entire marketing mix
T
T F Test marketing is used by companies of all sizes, primarily because of the perceived risk of product failure on the open market and the associated consequences.
T
T F The business analysis stage of new-product development explores how well the new product fits in with the firm's existing product mix.
T
T F The major drawback in using aesthetic modifications is that their value is determined subjectively.
T
T F The product development stage determines the technical feasibility of producing the new product
T
T F The runout approach to product deletion is used for technologically obsolete products.
T
T F The sum of all the product's physical characteristics is called product quality.
T
T F There is no best approach to managing products
T
T F Time spent in test marketing can benefit a firm's competitors.
T
T F To manage products effectively, the product manager must be independent of other departments.
T
T F Venture teams work outside of established organization divisions.
T
T F Warranties and customer training are examples of customer services.
T
In 2008, Cheetos was in which phase of new-product development?
Test marketing
Product failure is a concern of all marketers. Which of the following phases of new-product development is best able to measure this concern?
Test marketing
Sales and cost analyses occur most frequently in what stage of the new-product development process?
Test marketing
Select the true statement concerning test marketing.
Test marketing is a limited introduction of the product in areas chosen to represent the intended market
Why are line extensions more common than new products?
They are less expensive and lower-risk.
PepsiCo has a new flavor of soft drink that it wants to test to determine reactions of probable buyers. Which of the following test-market characteristics would be least useful to PepsiCo when testing the new soft drink?
Tourism is a major industry in the area.
What is the primary distinction between a line extension and a product modification?
With product modifications, the original product is replaced in the product line while both the old and the new products remain in the case of line extension
Cheetos produces several cheese snack products and is considering a new Cheetos brand of crackers. This new Cheetos brand of crackers would most likely be an example of
a line extension.
The group of people that management has assembled to take on the task of new-product development is best described as
a venture team.
Changes that affect the sensory appeal of a product by altering its taste, texture, sound, smell, or visual characteristics are called ___________ modifications
aesthetic
If Conway School Furniture Company provides standard primary school chairs in new colors to match the interiors of schools, this modification is most likely to be viewed as a(n) __________ modification.
aesthetic
Improving the taste of Cheetos Crunchies was a(n) __________ modification
aesthetic
Sony's design of its new plasma television sets with smoked-glass control panel covers and other visual changes would be classified as a(n) ___________ modification.
aesthetic
If buyers choose certain types of products by the way they look, smell, taste, or sound, marketers should focus most on appropriate
aesthetic modifications.
The three major ways to modify a product include
aesthetic, quality, and functional changes
If Megan Roberts were given total marketing responsibility over Diet Cherry 7Up, she would hold the position of __________ manager.
brand
The product deletion process is similar to the ___________ step of the new-product development process because both involve deciding whether the product should be in the product mix based on an assessment of sales, costs, and profits.
business analysi
"Is the demand strong enough?" is a question that marketers ask during the ___________ phase of new-product development.
business analysis
Breakeven analysis is a tool that marketers are likely to employ during the ___________ stage of the new-product development process.
business analysis
Stacey and Evan are preparing budgets for a new product as well as finalizing plans for the full-scale marketing and manufacturing of the new Genie-Vac. They are in the ____ phase of the new-product development process.
commercialization
When Natalie and Chris analyze the results from the recently completed test market to determine if any changes in the marketing mix are needed, they are in the ___________ phase of the new-product development process.
commercialization
One disadvantage of test marketing a new product is that
competitors may copy the product.
Marketers at Starbucks have generated several ideas for new food products. Management has assessed whether these ideas are consistent with Starbuck's objectives and resources. Several product ideas were dropped after this analysis. The next stage of development for the remaining product ideas is
concept testing.
Questions such as "How often would you buy this product?" and "Which features are of little or no interest to you?" are often proposed during
concept testing.
The phase of new-product development in which a small sample of potential buyers are presented with a product idea through a written or oral description in order to determine their attitudes and initial buying intentions regarding the product is called
concept testing.
The ability of a product to provide the same level of quality over time is called
consistency.
To differentiate their products, companies sometimes emphasize the product support services that they offer. This is especially true when
consumers perceive all products in a market to have essentially the same quality, design, and features
Best Buy differentiates its product offerings from its competition with stores like Sam's, by offering delivery and installation, financing arrangements, and repairs. Best Buy is differentiating through
customer services.
Quality modifications are changes that relate to a product's
dependability and durability.
When determining how a product is conceived, planned, produced, and even its physical appearance and its specific characteristics, one is really talking about the product's
design, styling, and features.
The members of a venture team come from
different functional areas of an organization.
Outback Steakhouse wants to expand its line of food products. The managers sent surveys to customers to determine which food items would appeal to them. Outback is currently in the __________ phase of new-product development.
e) idea generation
All of the following are major steps in developing new products except
evaluation of competitors' efforts.
A runout policy of product deletion
exploits any strengths left in the product.
Changes that affect a product's versatility, effectiveness, convenience, or safety are called ___________ modifications.
functional
When Conair adds an electrical component that automatically shuts off its curling irons when they have been left on for more than one hour. This improvement would best be classified as a(n)
functional modification
After a company has created a prototype during the product development stage, its performance, or ___________ must be tested.
functionality
Polar management is currently in which stage of new product development?
idea generation
Suppose that Cheetos stops production of Cheetos Fat-free Crunchies and sells all of its remaining inventory to a warehouse club. This would be an example of a(n)
immediate-drop decision.
A genuinely new product—like the iPhone once was—offers
innovative benefits to consumers.
The test-marketing stage
is a sample launching of the entire marketing mix.
If Jason Carter, product manager at SeaRay Boats, became aware that Bass Boats, Inc., was in the process of test marketing a new line of shallow-water fishing boats in the southeast region, he might want to engage in ___________ to reduce the validity of the other firm's results.
jamming
Competitive interference with a test-marketing program is called
jamming.
Victor thinks that a Lexus coupe is a quality vehicle, yet compared to a Mercedes Benz, he feels the quality of a Lexus is not as high. This demonstrates that the dimension of _____ is relative or difficult to describe without a basis of comparison.
level of quality
A(n) ___________ is the development of a product that is closely related to one or more products in the existing product line but is designed specifically to meet somewhat different needs of customers
line extension
If the manufacturer of Cool Whip were to introduce an orange-flavored Cool Whip and still continue to produce all of its other Cool Whip products, this would be an example of
line extension.
Coca-Cola has expanded to Diet Coke, Cherry Coke, and Caffeine-free Coke, to name a few. These are examples of
line extensions.
Dropping an unprofitable product immediately is the best strategy when
losses are too great to prolong the product's life.
Kyle Bolger of U.S. Hospital Supply Corporation has responsibility for managing the marketing activities for products aimed at nursing homes and extended care facilities. Kyle's job is that of a(n)
market manager.
Product deletion
may be opposed by management.
Luis Mayo is an accountant at Ralston Purina. However, he is currently working with a group to determine the feasibility of a new brand of hot breakfast cereal. After the product is launched, Luis will return to the accounting department. His present position can be described as a
member of a venture team.
In product modification, three conditions must be met to improve a firm's product mix: the product must be modifiable, customers must be able to perceive that a modification has been made, and
modification should make the product more consistent with customers' desires.
Product deletion can best be described as the process of deleting a product from the product mix when it
no longer satisfies a sufficient number of customers.
Introducing new products is risky and so is
not introducing new products.
A brand manager in a multiproduct firm would be responsible for
performance of a specific brand.
Marketers of a particular brand of ice cream have decided to delete their line of ice cream bars. They will do so by letting the product decline and not change the current marketing strategy. This method of deletion is called
phase out.
If 7-UP decides Diet 7-Up with Vitamins is not reaching profit expectations and simply allows the product to decline without any change in marketing strategy, it is using a ____ deletion strategy.
phase-out
The decision to delete the industrial product line of ice chests is an example of deleting a product through a(n) _____, while the decision to drop the thermal underwear line is an example of a(n) ______.
phase-out; immediate drop
If Kraft General Foods offered you a position in which you would have total marketing responsibility for all of its cheese products, this position would probably hold the title of __________ manager.
product
"How much quality should we build into the product?" is a question that marketers ask during the ___________ phase of new-product development.
product development
After building a prototype of his new device, Brad is asked to conduct rigorous functional testing to see if the device meets performance and safety qualifications. This is part of the ____ phase of the new-product development process.
product development
Marketers begin to make decisions about labeling, packaging, branding, pricing, and promotion during
product development.
The phase of the new-product development process when the organization determines the technological feasibility of producing the product at a cost that results in a reasonable selling price is
product development.
Schwinn adds features to its bicycles no other companies offer in order to create
product differentiation
If Ford adds a driver-side sliding door, side impact airbags, and a small television with DVD player to its Freestar Minivan, it is differentiating its product based on
product features.
A ______ is responsible for a product, product line, or several distinct products in an interrelated group within an organization.
product manager
Three major ways in which marketers engage in product differentiation are
product quality, product design and features, and product support services.
If Hewlett-Packard provides its customers with a help line for computer questions and problems, it is differentiating itself through
product support services
Bauman Flooring found a supplier of very inexpensive fibers that could be used to produce low-grade carpeting at a very low cost. Because Bauman had been facing stiff competition in the medium-grade carpet industry, it started using the new material in all of its carpeting and reducing its prices. This is an example of a(n)
quality modification.
The overall characteristics of a product that allow it to perform as expected in satisfying customer needs is
quality.
A complex product development process, including an extensive business analysis to determine the possibility of success, are hallmarks of a
radically new product.
Elena recently purchased a pair of sunglasses because she liked their quality, styling, and price. Her friend Katie purchased an almost identical pair, except that Katie's sunglasses had the name "Armani" imprinted on the side. Elena probably based her purchase decision on ___________, whereas Katie apparently based her decision on ___________.
real product differences; perceived product image
Functional modifications usually require that the product be
redesigned.
A new variety of Doritos is initially introduced in Ft. Worth, Texas; Columbia, South Carolina; Peoria, Illinois; and Spokane, Washington. After its initial success, Frito Lay markets the Doritos in those entire states, then the adjacent states, and finally the entire country. Frito-Lay is using a _____ for its new variety of Doritos.
roll-out approach
Often, a new product is launched in stages during commercialization. This gradual introduction of the product is known as
roll-out.
Compared with other phases of the new-product development process, the largest number of new-product ideas is rejected during the ___________ phase.
screening
Concerns about cannibalization of current product sales must be addressed in the ___________ phase of the new-product development process.
screening
A suggested approach to deleting products, in which each product is evaluated periodically to determine its impact on the overall effectiveness of the firm's product mix, is called a(n)
systematic review.
Because some products are not doing well, Jonathan Moore thinks that the company should set up a procedure to evaluate each product so that management will know when and how a product should be discontinued. He is suggesting a
systematic review.
Angela and Ralph at Tablerock Foods believe they have come up with a delicious low-calorie dessert, but they have some doubt about which of two promotional and pricing campaigns will be better received by consumers. In this instance, they probably should proceed to the ___________ stage of the new-product development process.
test marketing
Top managers at Cincinnati Microwave believe that they have a successful working prototype of their new radar detector and plan to go directly to regional commercialization of the new product. In this instance, they are contemplating skipping the __________ phase of the new-product development process.
test marketing
The major drawback to using aesthetic modifications is
that the value of the modification is determined subjectively.
In product modification, the first issue to consider is whether
the product is modifiable.
Elizabeth from marketing, Manuel from finance, Tony from production, Cynthia from engineering, and Alexandra from research and development were put together by their company to develop a new low-calorie, high-nutrition snack treat. These five people are a(n) __________ at their company.
venture team
The following organizational approaches accomplish tasks necessary to develop and manage products: market manager approach, product manager approach, and the _________ approach.
venture team
Early in the commercialization phase, marketers must make decisions about
warranties, repairs, and replacement parts.