Marketing Exam 2: Ch. 12

Before Segway manufactured its two-wheeled people movers, it built a prototype and had staff engineers test it for performance and stability. At this stage, Segway was involved in A. alpha testing. B. product launch. C. test marketing. D. beta testing. E. concept testing.

A

Brian is trying to sell a new line of ultrasound imaging equipment. Unlike existing technology, these machines are compact, creating the potential for general practice physicians to have and use them in their offices. Brian is trying to identify innovators in his market, knowing these customers will A. spread positive word of mouth to other physicians. B. buy one for each office in their practices. C. reposition his products. D. create demand among the late majority. E. not need any service or support when using the product.

A

Computer game companies constantly monitor computer game-related blogs keeping track of the latest hot products, because they know that their customers crave the latest and greatest games. They use this information to create new products that primarily provide the benefit of A. keeping up in a market where sales come mostly from new products. B. satisfying the changing needs of former customers. C. avoiding market penetration from products that have been on the market for a long time. D. creating diversification and reducing risk. E. taking advantage of a long product cycle.

A

During the __________ stage of the product life cycle, sales are low and profits are small or negative. A. introduction B. leveling C. maturity D. growth E. decline

A

Early personal computer users remember the cumbersome, user-unfriendly DOS system. When Apple introduced System 1 and Microsoft introduced Windows, both of which were much easier to use, these new products diffused rapidly because of their A. relative advantage. B. compatibility. C. observability. D. complexity. E. trialability.

A

If a few of Nintendo's customers are asked to try out a new video game that has not yet been released on the market, this is an example of A. beta testing. B. market testing. C. premarket tests. D. test marketing. E. concept testing.

A

In many cases, pioneers lose their market lead and initial market share to imitators who A. capitalize on the pioneers' weaknesses. B. create similar products with reduced value to consumers. C. utilize alpha-beta testing. D. ignore patents and copyrights. E. target late maturity consumers.

A

In one test before product launch, customers try a sample product and are then surveyed to understand whether they would buy/use the product again. This is known as A. premarket testing. B. market testing. C. alpha testing. D. concept testing. E. pre-launch testing.

A

Inkjet printers were a big improvement over the dot matrix printers they replaced. Inkjet printers gained rapid acceptance in the marketplace primarily because of their A. relative advantage. B. compatibility. C. observability. D. complexity. E. trialability.

A

Lorraine belongs to a national consumer panel created by a market research company. She regularly receives samples of new products from a variety of firms and fills out questionnaires about the products. The national consumer panel Lorraine is part of is engaged in A. premarket testing. B. product launch. C. test marketing. D. product development. E. concept testing.

A

When a manufacturer launches a new product, it may offer __________ to wholesalers and retailers, including introductory price promotions, special events, and personal selling. A. trade promotions B. trade shows C. trade-in allowances D. trade discounts E. trade budgets

A

Whenever Donald considers upgrading his personal computer system, he consults with Jeremy, a knowledgeable friend who always has the newest technology. For Donald, Jeremy is a(n) __________ in the diffusion of innovation curve. A. innovator B. laggard C. late majority D. early majority E. early adopters

A

Which of the following is NOT a characteristic of products in the maturity stage of the product life cycle? A. Laggards are a major focus of marketing efforts. B. Price competition is intense. C. Marketing costs increase as firms defend their market share. D. The market may become saturated because nearly all potential customers have adopted the product. E. To increase the customer base, firms consider entry into new markets and new market segments.

A

During the introduction stage of a product's life cycle, typical consumers are A. early adopters. B. innovators. C. pioneers. D. early majority. E. laggards.

B

Even if they succeed, new-to-the-world products are A. not always profitable. B. not adopted by everyone at the same time. C. sometimes copycat brands. D. not subject to the law of first movers. E. typically very short-lived.

B

How is consumer panel data collected during the test marketing phase of a new product introduction? A. Panelists complete a questionnaire about the product. B. Panelists scan their receipts on a home scanning device. C. Stores provide sales data to companies. D. Consumers voluntarily go to a website to record their preferences. E. Focus groups are held in key markets.

B

If a new product concept gets positive evaluations from potential customers during concept testing, the next step for a firm is A. market testing. B. product development. C. brainstorming. D. reverse engineering. E. launching the product.

B

In the diffusion of innovation process, innovators enjoy taking risks and are regarded as highly knowledgeable. Marketers want to identify innovators because A. they prefer products from established market leaders. B. other consumers defer to their judgment, creating the opportunity for word-of-mouth referrals. C. they are especially price conscious. D. they are easily influenced by reminder advertising. E. they encourage competitors to enter the market.

B

One reason auto companies spend millions on racing cars is that they offer the opportunity to test new designs and technology under extreme conditions. Car racing provides an opportunity for A. pretesting. B. beta testing. C. test marketing. D. alpha testing. E. concept testing.

B

Pioneer or breakthrough products A. will likely result in late maturity buying. B. can change consumer preferences. C. incorporate reverse engineering outputs. D. require the use of concept testing services. E. must be geographically centered.

B

Some products may stay comfortably in the maturity phase of the product life cycle until a new product emerges to replace them. An example of such a mature product is A. e-books. B. refrigerators. C. the VCR. D. smartphones. E. None of these. No product can stay in the maturity phase and survive for very long.

B

The __________ step in the product development process is critical, requiring tremendous resources and extensive coordination of all aspects of the marketing mix. A. pretesting B. product launch C. post-testing D. product development E. evaluation of results

B

Which of the following is NOT one of the five groups in the diffusion of innovation curve? A. Innovators. B. Non-adopters. C. Late majority. D. Early majority. E. Early adopters.

B

__________ involves taking apart a product, analyzing it, and creating an improved product that does not infringe on the competitor's patents. A. Reverse innovation B. Reverse engineering C. Selective dissection D. Redistribution E. Creative destruction

B

The pharmaceutical industry often justifies the high prices for new drugs by arguing that it researches as many as one hundred new compounds before it comes up with one __________, an extremely successful product that pays for the costs associated with the other attempts to develop new products. A. standout B. blockbuster C. first mover D. pioneer E. premium product

B a blockbuster is a highly successful product, which can fund attempts to develop other products that were less successful

A marketing professor in Ithaca, New York, maintains a museum of failed consumer products. Most new products in this museum failed during the __________ stage of new product development, when they are introduced to a limited geographical area. A. pretesting B. product launch C. test marketing D. product development E. concept testing

C

Barbara is using a test model of her firm's new inline skates to see whether they work according to the design specifications. Barbara is involved in A. test marketing. B. product launch. C. alpha testing. D. product development. E. concept testing.

C

By the time BMW and Mercedes Benz entered the mini-SUV market, there were many competitors, sales had peaked, and profits were declining. These firms entered the market during the __________ stage of the product life cycle. A. introduction B. leveling C. maturity D. growth E. decline

C

By the time BMW got into the mini-SUV market, sales had leveled off and were even starting to decline. BMW had to target its marketing efforts toward the __________ diffusion of innovation group. A. innovator B. laggard C. late majority D. early majority E. early adopter

C

Concept testing is important because it can A. help the firm to refine the promotional plans. B. lead to immediate rollout of the final product. C. help a firm avoid the costs of unnecessary product development. D. reduce the potential loss of sales during the decline stage. E. increase product development costs.

C

During the __________ stage of the product life cycle, sales peak and profits begin to decline as competition becomes intense. A. introduction B. leveling C. maturity D. growth E. decline

C

For new product marketers, early adopters are important because they tend to be A. few in number. B. the first to adopt a new product. C. opinion leaders. D. fond of prototypes. E. alpha testing enthusiasts.

C

Ron sells commercial-grade tools to building contractors. Whenever he visits his customers, he looks to see whether they are using his tools for other tasks or have modified the tools for some other purpose. These customers are __________, who can provide ideas for new and improved products. A. early adopters B. market testers C. lead users D. reverse engineers E. concept testers

C

The __________ diffusion of innovation group is the last large group of consumers to adopt a new product or service. A. innovator B. laggard C. late majority D. early majority E. early adopter

C

The diffusion of innovation theory is useful to marketers in helping them A. adjust to the performance life cycle. B. avoid the cost of concept testing. C. predict which types of customers will buy their product immediately and later. D. predict how long it will take for a new product to gain market acceptance. E. forecast sales for a new product.

C

The process by which the use of a new product or service spreads throughout a market group is referred to as A. new product introduction. B. lead user dispersion. C. diffusion of innovation. D. the product life cycle. E. product development diffusion.

C

When McDonald's comes up with a new drink or sandwich for its restaurants, it often markets it in a dozen or so of its outlets. When the company does this, it is engaged in A. pretesting. B. product launch. C. test marketing. D. product development. E. concept testing.

C

When microwaves were new, they often cost over $300, were huge, and had numerous settings and options. Brenda and Bart waited, concerned about potential health hazards and wishing for more choices in the market. By the time they purchased a microwave, sales of microwaves had leveled off and prices had declined significantly. Brenda and Bart were part of the ___________ diffusion of innovation group. A. innovator B. laggard C. late majority D. early majority E. early adopter

C

When testing new products, most firms consider the question of whether testing products on animals A. should always be done in the animal's natural environment. B. should be done outside of the United States to avoid consumer backlash. C. should be done when the new product does not contribute to the health and well-being of human users. D. should be done only by companies large enough to be ethically responsible. E. should be done with animal activists present.

C

__________ are customers who modify existing products according to their own ideas to suit their specific needs. A. Early adopters B. Market testers C. Lead users D. Reverse engineers E. Concept testers

C

A(n) __________ is a fee paid by manufacturers to get new products into stores or to gain more or better shelf space for products. A. facilitating payment B. introductory price promotion C. slotting allowance D. stocking premium E. place holder

C slotting allowances are often paid to retailers to get access to shelf space

As soon as she saw one, Hillary wanted a flat-screen television, but she was worried about making the wrong choice. She waited until there were alternatives in the market with lower prices and improved quality. Hillary is part of the __________ diffusion of innovation group. A. innovator B. laggard C. late majority D. early majority E. early adopter

D

By adding new product lines beyond its core business of computer software, like the Zune MP3 player and Xbox 360 game system, Microsoft primarily benefits by A. keeping up in a market where sales come mostly from new products. B. satisfying the changing needs of the technological research staff. C. avoiding market saturation from products that have just been introduced to the market. D. creating diversification and reducing risk. E. spreading out production costs.

D

Cathy has used Olay beauty products for years, even though there are many competitors on the market. She plans to purchase a recently introduced micro-sculpting cream from Olay's regenerist line. Olay is in the _________ stage of the product life cycle. A. introduction B. growth C. evaluation D. maturity E. decline

D

During the __________ stage of the product life cycle, sales rise, profits rise rapidly, and there are a small but increasing number of competitors. A. introduction B. leveling C. maturity D. growth E. decline

D

Eric is a sales rep for an established building materials manufacturer. Business is good, but he is concerned that the company has spent little on new product development and has not created a new product in over five years. Without new products, Eric can only market to his current customers or A. diversify. B. intensify his prototyping. C. expand his early adopter market segment. D. market the same products to similar customers. E. focus on concept testing.

D

Innovators are a critical group of new product adopters because they A. are the major source of innovation. B. act as reverse engineering consultants. C. help with test marketing. D. help the product gain market acceptance. E. extend the product life cycle.

D

Successful first movers create a market or a product category. They often benefit from being readily recognizable to consumers and A. not having to pay advertising expenses. B. using prototypes to dominate the market. C. not needing to do test marketing. D. establishing an early market share lead. E. motivating laggards to buy their products.

D

The __________ diffusion of innovation group is crucial because few new products can be profitable until this large group buys them. A. innovator B. laggard C. late majority D. early majority E. early adopter

D

What type of event exposes retailers to large numbers of new products in a concentrated location? A. hosted shows B. browser shows C. premarket demonstrations D. trade shows E. trade promotions

D

When Dr. Putt invented his Eye-Over-the-Ball (EOB) golf putting device, he knew during the introductory stage A. sales would rise quickly, profits would jump, and even laggards would buy his product. B. sales would level off, profits would decline, and mature golfers would be attracted to his product. C. sales would slow down, profits would peak, and early adopters of golf equipment would be his major customers. D. sales would be low and profits nonexistent, but he would attract golf equipment innovators. E. sales would be low, profits would be high, and all potential golfers would jump at the opportunity to buy his product.

D

When Toyota introduced hybrid cars, there were waiting lists to buy them. Then Honda and a few other manufacturers entered the market, shifting the product life cycle for hybrid cars into the __________ stage of the product life cycle. A. introduction B. leveling C. maturity D. growth E. decline

D

When a product is successful in the introductory stage of the product life cycle, A. it moves directly into the maturity stage. B. it is most likely to begin to launch spinoffs. C. competition becomes less important. D. it may start to see profits toward the end of this stage. E. marketing costs increase significantly.

D

Which of the following is LEAST likely to be a source of ideas for new products? A. R&D efforts B. licensing technology C. consumer research D. geodemographic segmentation E. brainstorming

D

__________ are special incentives offering reduced prices for a limited time, offered to retailers to get them to try a new product. A. Loss leaders B. Push prices C. Market skimming incentives D. Introductory price promotions E. Distribution rebates

D

All of the following are ways that manufacturers use promotion to generate demand for new products with consumers EXCEPT A. short-term price reductions. B. coupons. C. rebates. D. advertising. E. coordination of delivery and storage.

E

Between concept testing and market testing, a firm should engage in which stage of the product development process? A. securing financial backing B. marketing research C. brainstorming D. determining potential ROI E. product development

E

During the ___________ stage of the product life cycle, firms either position themselves for a niche market of loyal consumers or they exit the market. A. introduction B. leveling C. maturity D. growth E. decline

E

Golf ball manufacturers use Iron Mike, a machine that swings a golf club at a constant velocity, to test the distance for new golf ball designs. When using Iron Mike, the manufacturers are engaged in A. concept testing. B. market testing. C. premarket tests. D. product development. E. alpha testing.

E

If the __________ diffusion of innovation group is relatively small, the number of people who ultimately adopt the innovation likely will also be small. A. innovator B. laggard C. late majority D. early majority E. early adopter

E

In the United States, most consumer packaged goods found in grocery and discount stores are in the __________ stage of the product life cycle. A. growth B. pioneer C. introduction D. decline E. maturity

E

Robin recently bought Voice over Internet Protocol (VoIP) phone service. A few of Robin's friends bought VoIP before she did, but many other friends were interested in Robin's opinions of the new phone service. Robin is a(n) __________ in this product category. A. innovator B. laggard C. late majority D. early majority E. early adopter

E

The __________ is a specific price at which manufacturers encourage retailers to sell a product. A. key price point B. slotting fee C. perceived value D. retail margin E. manufacturer's suggested retail price

E

The growth phase of the product life cycle is always dynamic. Which of the following does NOT occur in this phase? A. Profits increase as sales increase. B. Profits increase as economies of scale are attained. C. Some new competitors may enter the market with similar products. D. Some competitors will exit in an industry shakeout. E. Price competition with protracted price wars erodes profits.

E

Which of the following would NOT be part of the launch of a new product? A. educational efforts for complex or conceptually new products B. technical support staff for technical products C. determining the price for the product D. incentives for distributors E. starting to make preliminary decisions about the target market

E

Samples are often used for new products when __________ will influence the diffusion of the product. A. relative advantage B. compatibility C. observability D. complexity E. trialability

E trialability refers to a consumer's ability to try a new product before buying it; samples make this process easier