Marketing Chapter 9
TQM is based on the idea that the cost of poor product quality is ______.
lost customers
Ultimately, the cost of a poor quality product or service is _____.
lost customers
Firms that sell ______-related products should expect short product life cycles.
fashion
In general, product life cycles, as a whole, are ______.
getting shorter
An organizational culture that emphasizes ______ can generate more ideas.
innovation
Competitive advantage is especially important in ______ product-markets.
mature
A product idea can be in a different ______ in different markets.
life-cycle stage
It is important to evaluate a new idea's return on investment and likely__________.
profitability
During the market introduction stage of the product life cycle, it takes time for customers to learn that a new product is available; therefore, a firm must invest heavily in ______.
promotion
List the steps of the new-product development process in order, placing the first step at the top of the list.
1. Idea generation 2. Screening 3. Idea evalauation 4. Development of product and marketing mix 5. Commercialization
Direct contact between the customer and the company occurs most often among ______ organizations.
service-providing
Product life cycle patterns apply to the sales of a given product idea in a(n) ______.
specific product-market
Finding a new use for an existing product in a mature market has the potential to ______.
stimulate sales growth
Rapid prototyping ensures that ______.
the best version of the product reaches the market as quickly as possible
Which of these characteristics help a new product move quickly through the early stages of the product life cycle? (Check all that apply.)
Ease of use Matches values of target customers Comparative advantage
Really new product innovations tend to ______.
disrupt old ways of doing things
Total quality management requires ______ to focus on quality and meeting customer needs.
everyone in the organization
Which of the following occur in the sales decline stage of the product life cycle? (Check all that apply.)
Strong brands can make profits. Price competition becomes vigorous. New products replace old.
The introduction of camera technology to cell phones, which required users to learn relatively minor new behaviors, is an example of a(n) _____.
dynamically continuous innovation
Products influenced by fashion typically have _____ life cycles.
short
When companies use their competitors as sources of new-product ideas, they often ______.
disassemble competitors' products in order to reverse engineer their innovations
Place the four stages of the product life cycle in order from the first stage (top) to the final stage (bottom).
market introduction market growth market maturity sales decline
Rapidly changing ______ is one reason why product life cycles are getting shorter.
technology
Getting reactions from customers about how well a new product idea fits their needs is called ______.
concept testing
Continuous improvement means that an organization strives to ______.
constantly make things better
Which of the following should impact marketing strategy planning? (Check all that apply.)
How fast the product is moving to the next stage Where a product is in its life-cycle stage
A firm should never skip steps in the new-product development process because ______.
a single misstep or oversight could cause the product to fail.
Jason participated in a focus group in which he was shown a new line of "healthy" soft drinks and tasted the product. He wrote down his reaction to how well he thought the soft drink tasted and whether or not he preferred it over his current soft drink. Jason is participating in _____.
concept testing
New products that require minor changes in customer behavior are called ______ innovations.
dynamically continuous
The cost of new-product development is typically ______ and the associated risk of failure is ______.
high; high
Concept testing in the form of focus groups, surveys, or online testing are all ways to conduct ______.
market research
During the market growth stage of a product, a company will want to focus promotional efforts on _____ customers.
persuading
The first company to introduce a new product to a market is known as a(n) ______.
pioneer
The legal obligation of sellers to pay damages to individuals who are injured by defective or unsafe products is called ______.
product liability
The major responsibility of most product managers or brand managers is ______.
promotion
A sunglasses manufacturer that develops a sample of a new product design to test among employees and customers has produced a(n) ______.
prototype
A(n) _________ is an early sample or model built to test a concept.
prototype
Sales of an individual product or brand will ______ follow the product life-cycle pattern.
rarely
When research and development managers at Bosch Home Appliances purchase a new Maytag dishwasher and take it apart to get new product ideas, Bosch's managers are engaging in ______.
reverse engineering
Because introducing a new product is expensive, a marketing manager may try to ________ the market--- charging a relatively high price to help pay for the introductory costs.
skim
A firm that attempts to provide superior customer service by focusing on quality throughout each of its activities is engaging in ______.
total quality management (TQM)
Moments of direct contact between the customer and the firm, also known as ______, are opportunities for the company to deliver superior value.
touchpoints
Two keys to improving service quality are ______.
training and empowerment
The duration of the whole product life cycle tends to ______.
vary greatly across products
True or false: The sales and profits of an individual brand always follow the product life-cycle pattern.
False
Which of the following occur in the market maturity stage of the product life cycle? (Check all that apply.)
Industry profits decline. Competition gets tougher.
Candace doesn't want another company to copy her idea for a self-charging phone case. To protect her idea, Candace should file for a _____.
patent
When a firm determines that a product will no longer be profitable enough for the firm to meet its objectives, it may need to develop a ______ strategy.
phase-out
The cost of ______ is lost customers.
poor quality product
Which governmental body was set up to encourage safety in product design and better quality control?
Consumer Product Safety Commission
Which of the following factors are important to new product success? (Check all that apply.)
Effective transitions from idea to market Effective product design Offering superior customer value
True or false: Marketing managers should focus on informing customers about their brand during the market growth stage of the product life cycle.
False
You would conduct a S.W.O.T. analysis in the _____ phase of the new product development process.
screening
Companies that respond quickly to products introduced by pioneers and offer a superior marketing mix are known as ______ and can be more profitable over time.
second-movers
In the service industry, training and empowerment are two keys to improving ______.
service quality
It is important that a firm _____ in the new-product development process.
should not skip steps
True or false: Now that companies spend more money on new product introduction, it is common for more than 80 percent of new products to succeed.
False
True or false: Product liability is capped so that total costs to a firm cannot exceed its total assets.
False
In what stage of the product life cycle do many firms slash prices or modify existing products to add value and maintain market share?
Maturity
______ is essential if a company is going to survive in today's dynamic markets.
New product development
Most companies experience losses during the market ______ phase due to high levels of promotional spending, sharing information about the product, and low sales. All of these are important since most target customers are not aware of the product.
introduction
Which of these products is protected by copyright law?
A musical score
During the ______ step of the new-product development process, a new product is finally placed on the market.
commercialization
The longer new-product development takes, the more likely it is that ______.
customer needs will change
In the ______ step of the new-product development process, the physical product is designed.
development
A phase-out strategy should be implemented _____.
gradually
If a new product has a greater comparative advantage over products already on the market, sales will tend to _____.
grow more rapidly
Tennis Products Corp. 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.
market maturity
Sometimes in a(n) ______ market, a firm may find a new use for an existing product that aids in boosting sales and avoiding sales decline.
mature
Many firms respond to the increased competition of the market ______ stage of the product life cycle by slashing prices in order to maintain market share.
maturity
An offering that is different in any way from a company's other products is known as a(n) ______ product, even if it is a refined version of a previous product.
new
Because the product life cycle is an inevitability in most markets, a firm must have an active ______ process or otherwise risk going out of business.
new-product development
It is important to evaluate a new idea's return on investment and likely .
profitability
The Consumer Product Safety Commission has the power to _____.
remove a toy from the market if it posed a choking hazard
The development stage of the new-product development process helps to determine ______.
the materials, equipment, staff, or training that will be required to deliver a new product or service
Seeing sales of its tennis balls in decline, the brand manager at Tennis Pro International made minor changes to the brand's packaging (moving from three-ball packages to four-ball packages) and promoted this as a new product. How would the Federal Trade Commission respond to this decision?
It probably would not approve of it.
Match the stage of the product life cycle (on the left) with the characteristics of the product-market (on the right).
Market introduction -Verizon introduces a phone with a 3D screen; no other firm has one. Market growth - Several firms sell compact fluorescent light bulbs; sales and profits are growing. Several firms sell compact fluorescent light bulbs; sales and profits are growing. Market maturity -There is a battle of the brands in frozen pizza, with all brand offerings being relatively similar. There is a battle of the brands in frozen pizza, with all brand offerings being relatively similar. Sales decline matches - Only a few firms still make disk drives for computers; sales and profits are dropping fast.
Which of the following positions oversee product promotion and often take over the jobs formerly handled by advertising managers? (Check all that apply.)
Product manager Brand manager
What is the one key trait found in companies that are successful at developing new goods and services?
Top-management support
An ongoing commitment to improving processes and products one step at a time is referred to as ______ improvement.
continuous
According to the FTC, a product can only be called new for _____.
six months
True or false: More ideas are generated in a firm with a culture that emphasizes efficiency and cost-cutting.
False
What are four common reasons why new products may fail? (Check all that apply.)
The marketing plan for the product is weak. The benefit offered is not unique. A company underestimates the competition. The product is not designed well.
SOme companies use data and ___________ intelligence to support continuous improvement.
artificial
The product life-cycle concept ______ indicates precisely how long each stage will last.
never
The process where customer input is incorporated into a new design of the product and then the revised product is given back to the customer for further evaluation is called ______.
rapid prototyping
Carl Kastle, marketing manager for NPG Electronics, reviews a S.W.O.T. analysis to help him evaluate three new product ideas NPG is currently considering. Kastle is operating in the ______ step of the new-product development process.
screening
The four stages new-product ideas go through are known as _____.
the product life cycle
Matthew received a pacemaker to help the arrhythmia he is experiencing with his heart. The pacemaker provides a continual stream of information that is monitored by specialists at the heart clinic and if they notice any indicators of concern, they contact Matthew and he reports to the clinic for assessment. What is helping the heart clinic improve the quality of care Matthew is receiving?
Data
K.C. Rao, brand manager for Hershey, has introduced a new low-calorie chocolate candy bar, Choco-Lite. He is gradually rolling out the product, starting to sell it in the western United States before moving east. He has decided on an expensive promotional campaign to make customers aware of the new bar. Choco-Lite is in which step of the new-product development process?
Commercialization
Which of the following are ideas consistent with total quality management? (Check all that apply.)
Everyone in the company should care about quality. It is less expensive to do things right the first time. Poor quality equals lost customers.
Which of the following typically occur in the market introduction stage of the product life cycle? (Check all that apply.)
Firms inform customers about the product. Sales are low. Customers are not seeking the product.
When introducing a new product in the market introduction stage, which of the following must a marketing manager consider? (Check all that apply.)
How to promote the product Which distribution channels to select The cost of product development
Match the activities (on the right) with the appropriate step of the new-product development process (on the left).
Idea Generation-Screening- Solicit ideas from customers. Idea evaluation- Idea fit with company objectives. Development- Create prototype. Commercialization- "Roll out" product in select markets
Which market situation is typical of the market growth stage of the product life cycle?
Monopolistic competition
Which of the following occur in the market growth stage of the product life cycle? (Check all that apply.)
Product variety increases. Innovators profit. New competitors enter. Sales grow fast.
During the new-product development process, a company should continually evaluate which two of the following? (Check all that apply.)
Profitability Return on investment
Which two of the following are potential advantages of performing concept tests online? (Check all that apply.)
Research and testing costs are lower. Feedback is immediate.
Most of Stardust Co.'s competitors have left the market because of declining sales. Stardust has introduced new products, but has continued producing the old products because a small group of loyal customers still use them. This product-market is in which product life cycle stage?
Sales decline
As a market moves into the market maturity stage, which of the following might provide a firm in that market with sources of competitive advantage? (Check all that apply.)
Successful promotion strategies A somewhat better product Lower production costs
