busi 14

introduction, growth, maturity, and decline

The stages of the product life cycle are.

increase

During the growth stage of the product life cycle, sales and profits mostly Blank______.

market

In the long run, price is determined by the:

nonprice competition

Marketers competing on product attributes and image are said to be participating in Blank______.

Convenience = Purchased often with little thought Shopping = Time spent on comparison to substitutes Specialty = No substitute will do Unsought = Unaware of product or not looking for it

Match the goods classifications with the buyer behaviors shown below.

Convenience = milk Shopping = washing machines Specialty = orthopedic surgeons Unsought = burial services

Match the type of consumer products with the products and services below

a skimming price strategy. Explanation A skimming price strategy prices a new product high to recover research and development costs and make as much profit as possible while there's little competition.

ABC Electronics introduced the first large flat screen TV. Shoppers were amazed by the sharp, colorful images, and consumers flocked to the stores to purchase one. ABC priced the product high while there were few competitors in order to recover research and development costs and maximize profits. This strategy is called

equity

Brand Blank______ is the value a firm places on its brand name and associated symbols. Multiple choice question.

tangible Explanation When people buy a product, they may evaluate and compare total product offers on many dimensions. Some are tangible (the product itself and its package); others are intangible (the producer's reputation and the image created by advertising).

Buffy was shopping at her local home improvement store for a new kitchen faucet. She was attracted to a brushed stainless steel model with a long arc and a swivel spout. These are __________ features of the faucet.

shopping Explanation Shopping goods and services are products the consumer buys only after comparing the value, quality, price, and style from a variety of sellers.

Chloe needs a new vacuum cleaner, so she's looking online to compare value, quality, price, and style from a variety of sellers. These types of products purchased after comparison shopping are known as __________ goods and services.

considering whether all of the benefits exceed all of the costs Reason: Correct. Customers compare the cost and effort required to obtain a product with its value to them.

Consumers calculate the value of a product by:

target costing

Designing a product so that it satisfies customers and meets the profit margins desired by firms is called ______.

Product screening = Reduces the number of products a company is working on down to the most promising Product analysis = Develops cost estimates and sales forecasts to determine profitability

Differentiate between the elements of the new-product development process:

Blank 1: price or pricing Blank 2: cost

Due to competition and demand in the marketplace, ______ and ______ are not always related.

product screening

During __, a marketing manager should use such criteria as fit with the firm's other products, profit potential, and marketability.

promote the product to distributors and retailers to get wide distribution. Explanation The commercialization stage includes (1) promoting the product to distributors and retailers and (2) developing strong advertising and sales campaigns to generate and maintain interest in the product among distributors and consumers.

Ed started Watseka Winery on his North Carolina farm when he switched from growing tobacco to growing grapes. After going through the various steps in the new-product development process, Ed and his fledgling company finally entered the commercialization stage of the new product development process. Ed knew that to succeed in selling the wine, the company would have to

only one product

It is unusual for a company to sell Blank______.

the total product offer. Explanation The total product offer consists of everything consumers evaluate when deciding whether to buy something. It is also called a value package.

Julius is considering buying new bedroom furniture. Naturally, he compares several types of beds, dressers, and bedside tables, but he also is evaluating each product's reputation, warranty, his own experience with the brand, and of course, the price. All of the components that Julius is evaluating make up

employees. Explanation Interestingly, employees are a major source for new consumer-goods ideas and more new ideas for industrial products come from employee suggestions rather than from research and development teams.

Most new-product ideas come from

the Internet

New products are getting rapid exposure to global markets through:

Introduction Growth Maturity Decline

Place the stages of the Product Life Cycle in order from earliest to latest with the earliest on top.

competition-based pricing

Pricing based on the pricing activities of other companies in relation to a product is called Blank______.

the marketing mix

Recognizing what stage of its life cycle a product is in has a direct impact on marketers' decisions about Blank______.

Blank 1: screening Blank 2: analysis

Reducing the number of new product ideas based on specific criteria is a function of product ( ), whereas determining the profitability of those ideas is a function of product ( ).

meet the competition appeal to similar consumer markets tailor their offerings more closely to consumer wants

Select all that apply Companies usually offer a product line instead of just one product to:

Giving a potential buyer a sense of price, value, and uses. Attracting the buyer's attention Explaining the benefits of what's inside

Select all that apply Packaging serves several critical functions in the overall success of a product. Some of these functions are

too few differences from competitors poor packaging poor positioning

Select all that apply The reasons why many new products fail include:

revenues from sales equals all costs

The break-even point is where Blank______.

different stages in the product life cycle call for different marketing strategies. Explanation Different stages in the product life cycle require different marketing strategies.

The importance of the product life cycle is that

break-even point

The point where revenues from sales equal all costs is called the Blank______.

demand-oriented

The pricing strategy in use when a firm prices products based on consumer demand is called Blank______.

False

True or false: Distributed product development is producing a firm's product without the help of other organizations

False Reason: Distributed product development involves handing off various parts of your innovation process.

True or false: Distributed product development is producing a firm's product without the help of other organizations.

true Reason: Grouping two or more products together and pricing them as a unit is called bundling.

True or false: Grouping two or more products together and pricing them as a unit is called stacking.

False Reason: It takes about seven ideas to generate one commercial product.

True or false: It takes dozens of ideas to generate one commercial product.

True Reason: Demand-based pricing focuses on designing a product so that it satisfies customers and meets profit goals.

True or false: Price and cost are not always related.

true Reason: The other two categories of Goods and Services - Convenience and Unsought - generally do not have much consumer forethought

True or false: The two categories of Goods and Service that take more effort on the part of consumers are Shopping and Specialty

Product analysis

Which step in the new product development process involves estimating costs and sales to get a feel for the new product's potential profitability.

national brand names

Xerox, Kodak, Sony, and Dell are all examples of Blank______.

Target costing

______ is a pricing strategy that aims to design a product so that it satisfies customers and meets the profit margins for a company.

price product promotion

A brand manager is responsible for which of the following?

consumer; industrial

A computer kept at home for personal use is considered a(n) Blank______ good, whereas the same computer purchased for use in a business office is considered a(n) Blank______ good.

are too similar to competitors

A major reason why many new products fail is that they:

computer

A product that could be both a consumer product or industrial product depending on its use is a:

maturity Explanation When a product is in the maturity stage of the product life cycle, one strategy is to differentiate the product to satisfy a greater number of market segments.

At which stage of the product life cycle do you differentiate your product so that it will appeal to additional market segments?

bundling

Grouping two or more products together and pricing them as a unit is called Blank______.

distributed product development

Handing off various parts of a firm's innovation process, sometimes to companies in other countries, is called Blank______.

5,000 Explanation The break-even point is total fixed costs divided by the price of one unit minus variable costs of one unit. In this case, 100,000 is divided by 20, which equals 5,000 units need to be sold.

If fixed costs are $100,000, variable cost per unit is $40, and the selling price is $60, how many units must be sold for the firm to break even?

unsought Explanation Unsought goods and services are products the consumer is unaware of, hasn't necessarily thought of purchasing, or suddenly needs to solve an unexpected problem. These products include emergency car-towing services, burial services, and insurance, for example.

Products that the consumer purchases like insurance, burial services, or emergency car-towing are known as __________ goods and services because they are not products that consumers regularly evaluate and consider purchasing.

brand equity

The value of the brand name and associated symbols refers to Blank______.

False Reason: The market will determine the price of a product in the long run.

True or false: Ultimately, producers determine the price of a product.

Xerox

What is an example of a current manufacturer's brand name that has not become generic?

a skimming price strategy

When a firm prices a new product very high to make optimum profit while there is little competition, it is said to be using ______.

product screening Reason: Correct. Product screening weeds out which product ideas are most likely to fit with a company's product line, sell well, and earn a profit.

Justifying a new product's fit, profit potential, and marketability is known as:

Idea generation product screening product analysis development testing commercialization

List the six steps in the new product development process, starting with the first step at the top and ending with the last.

To protect the goods inside

When opening a bag of potato chips the bag is much larger than what is inside. The reason for this most likely has to do with which function of packaging.

Brand manager

Which person has direct responsibility for all aspects of a product line or a brand including the marketing mix?

UPCs. Explanation The Universal Product Codes (UPCs) on many packages help stores control inventory. They combine a bar code and a preset number that gives the retailer information about the product's price, size, color, and other attributes.

Many packages have labels that help stores control inventory and give the retailer information about the product's price, size, color, and other attributes. These are

Blank 1: global, world, or target Blank 2: markets or market

Sellers are now able to commercialize new products more quickly using social media to reach ______ ______.

Blank 1: skimming

The pricing strategy that calls for a new product being priced high to make optimum profit while there is little competition is called a(n) ______ price strategy.

brand equity. Explanation Brand equity is the value of the brand, usually measured by a monetary amount.

The value of the brand name and its associated symbols is referred to as

Price

Which element of the marketing mix is the most difficult for a manager to control due to the impact it has on consumer evaluation of an offering?

product screening Reason: Correct. Product screening weeds out which product ideas are most likely to fit with a company's product line, sell well, and earn a profit.

Justifying a new product's fit, profit potential, and marketability is known as:

Blank 1: stage or phase

Knowing what stage ( ) of the product life cycle a product is in helps marketers make intelligent and efficient marketing decisions.

concept testing Explanation Concept testing takes a product idea to consumers to test their reactions.

The process of taking a product idea to consumers to test their reactions is known as

Demand-oriented

When airlines charge higher prices for seats in the Economy section Exit rows that have more leg room, they are using which pricing strategy?

calculating the value of the product

When consumers look at all of the benefits of a product and subtract all of the costs related to its purchase, they are:

a candy bar Explanation Convenience goods and services are products that the consumer wants to purchase frequently and with a minimum of effort, such as a candy bar.

Which item would be considered a convenience good?

Blank 1: Price or Pricing

______ is one of the most difficult of the four Ps for a manager to control, since it directly relates to the consumer perceptions of the value of a product.