3832 CH.11 – Flashcards

Unlock all answers in this set

Unlock answers
question
Steve wanted to open a day care service facility for dogs. He estimated the costs involved in providing the services desired by dog owners. After extensive deliberation, Steve decided not to proceed with the plan as the cost of providing the services was too high compared to the rates dog owners would be willing to pay. Which of the following stages of the new-product development process has Steve used to arrive at this decision?
answer
Business analysis
question
Which of the following is an advantage of simultaneous product development?
answer
It shortens a product's development process
question
T/F: A new-product strategy describes the characteristics of products an organization wants to offer and the markets it wants to serve.
answer
true
question
The purpose of test marketing is to:
answer
assess how well various aspects of the marketing mix fit together
question
T/F: A low failure rate, greater competition, and wide distribution typify the introductory stage of the product life cycle.
answer
false
question
Which of the following is a feature of a new-product strategy?
answer
It provides general guidelines for generating, screening, and evaluating new-product ideas
question
Roger is always eager to own the latest cell phone model launched in the market. He makes it a point to buy new cell phones on the first day of their launch. He is also an active member of various online forums that discuss the latest technical developments. In this case, Roger is a(n) _____.​
answer
innovator
question
T/F: In the growth stage of the product life cycle, sales typically grow at an increasing rate, many competitors enter the market, and large companies may start to acquire pioneering firms.
answer
true
question
Which of the following is true of product modification?
answer
It makes cosmetic or functional changes to existing products
question
Jeni's Splendid Ice Creams has decided to put its new Beet Cake with Black Walnut ice cream on the market. This product has entered the ____________ stage of new-product development process.
answer
commercialization
question
T/F: New products are important to sustain growth, increase revenues and profits, and replace obsolete items
answer
true
question
T/F: Sometimes it is difficult to decide when to replace a successful product
answer
true
question
new product
answer
a product new to the world, the market, the producer, the seller, or some combination of these
question
There are six categories of new products:
answer
New-to-the-world products, New product lines, Additions to existing product line, Improvements or revisions of existing products, Repositioned products, and Lower-priced products
question
New-to-the-world products (also called discontinuous innovations):
answer
These products create an entirely new market
question
New product lines:
answer
These products, which the firm has not previously offered, allow it to enter an established market
question
Additions to existing product lines:
answer
This category includes new products that supplement a firm's established line
question
Improvements or revisions of existing products:
answer
The "new and improved" product may be significantly or only slightly changed
question
Repositioned products:
answer
These are existing products targeted at new markets or market segments, or ones repositioned to change the current market's perception of the product or company, which may be done to boost declining sales
question
Lower-priced products:
answer
This category refers to products that provide performance similar to competing brands at a lower price
question
new-product strategy
answer
a plan that links the new-product development process with the objectives of the marketing department, the business unit, and the corporation
question
________________________ sharpens the focus and provides general guidelines for generating, screening, and evaluating new-product ideas
answer
new product strategy
question
Companies can derive insight from listening to _______________ or _______________, which often indicate early trends or areas consumers are interested in seeing develop or change
answer
Internet chatter; reading blogs
question
T/F: To encourage participation, some companies run contests, hold votes, and set up idea kiosks
answer
true
question
T/F: Many companies want to encourage risk-taking through new ideas and have begun implementing rewards for failing after taking a big risk
answer
true
question
product development
answer
a marketing strategy that entails the creation of marketable new products; the process of converting applications for new technologies into marketable products
question
Traditionally, ____________ determine whether a company has a balanced portfolio of products and, if not, what new-product ideas are needed to offset the imbalance
answer
consultants
question
A technique that is being used increasingly to generate new product ideas is called "_______________."
answer
crowdsourcing
question
T/F: General information regarding ideas being sought is provided to a wide range of potential sources such as industry experts, independent researchers, and academics
answer
true
question
____________ is the wellspring of new-product ideas, regardless of who comes up with them
answer
Creativity
question
The two considered most useful for generating new-product ideas are _____________ and _________________________
answer
brainstorming; focus group exercises
question
brainstorming
answer
the process of getting a group to think of unlimited ways to vary a product or solve a problem
question
screening
answer
the first filter in the product development process, which eliminates ideas that are inconsistent with the organization's new-product strategy or are obviously inappropriate for some other reason
question
The new-product committee, the new-product department, or some other formally appointed group performs the _______________________
answer
screening reviews
question
T/F: Concept tests are often used at the screening stage to rate concept (or product) alternatives
answer
true
question
concept test
answer
a test to evaluate a new-product idea, usually before any prototype has been created
question
T/F: Concept tests are considered fairly good predictors of success for line extensions
answer
true
question
business analysis
answer
the second stage of the screening process where preliminary figures for demand, cost, sales, and profitability are calculated
question
T/F: Analyzing overall economic trends and their impact on estimated sales is especially important in product categories that are sensitive to fluctuations in the business cycle
answer
true
question
development
answer
the stage in the product development process in which a prototype is developed and a marketing strategy is outlined
question
the marketing department should decide on the product's ___________, __________, ___________, and so forth
answer
packaging, branding, labeling
question
T/F: The time invested in development can often have tremendous payoff
answer
true
question
simultaneous product development
answer
a team-oriented approach to new-product development
question
This approach allows firms to shorten the development process and reduce costs
answer
simultaneous product development
question
The __________ is a useful tool for implementing simultaneous product development
answer
Internet
question
On the _______, multiple partners from a variety of locations can meet regularly to assess new-product ideas, analyze markets and demographics, and review cost information
answer
Web
question
The best-managed global firms leverage their global networks by sharing _________________, _____________, and _______________
answer
best practices, knowledge, and technology
question
________________ are often conducted on prototype models during the development stage
answer
Laboratory tests
question
test marketing
answer
the limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation
question
_________________ allows management to evaluate alternative strategies and to assess how well the various aspects of the marketing mix fit together
answer
Test marketing
question
T/F: est marketing frequently takes one year or longer, and costs can exceed $1 million
answer
true
question
Despite the ________, many firms believe it is better to fail in a test market than in a national introduction
answer
cost
question
One unavoidable problem is that test marketing _________ the new product and its marketing mix to competitors before its introduction
answer
exposes
question
simulated (laboratory) market testing
answer
the presentation of advertising and other promotional materials for several products, including a test product, to members of the product's target market
question
T/F: The Internet offers a fast, cost-effective way to conduct test marketing
answer
true
question
commercialization
answer
the decision to market a product
question
The decision to commercialize the product sets several tasks in motion:
answer
ordering production materials and equipment, starting production, building inventories, shipping the product to field distribution points, training the sales force, announcing the new product to the trade, and advertising to potential customers.
question
time from the initial commercialization decision
answer
It can range from a few weeks for simple products that use existing equipment to several years for technical products that require custom manufacturing equipment
question
Despite the amount of time and money spent on developing and testing new products, a large proportion of new product introductions _____
answer
fail
question
A ________________________ results when the product returns a profit but fails to achieve sales, profit, or market share goals.
answer
relative product failure
question
T/F: Increasing globalization of markets and competition provides a reason for multinational firms to consider new-product development from a worldwide perspective
answer
true
question
_____________ in some countries (such as China) often requires companies to develop products that meet the unique needs of these ______________
answer
succeeding; populations
question
innovation
answer
a product perceived as new by a potential adopter
question
Diffusion
answer
the process by which the adoption of an innovation spreads
Get an explanation on any task
Get unstuck with the help of our AI assistant in seconds
New