Deck 12: Test Markets and Experimental Design

Question 1

If salespeople in a test market city spend inordinate amounts of time making sure that the product is stocked sufficiently on supermarket shelves,the test market may suffer from overattention.

Answer 1

True

Question 2

Test-market studies should be concerned with initial trial purchases,but they do not have to be concerned about repeat-buying behavior.

Answer 2

False
Researchers must be concerned with repurchase rates as well as with initial trial purchases.

Question 3

One disadvantage of test-marketing is that the results are usually difficult to communicate to management.

Answer 3

False
One advantage is that the results are usually easily communicated to management.

Question 4

When a new product fails in a test market,this means that the test market for this product was a failure.

Question 5

The most complex method of projecting test market results to national results is with a straight line trend projection.

Question 6

It is usually necessary to use nine or ten cities when test-marketing in the United States.

Question 7

Researchers need to consider several factors in selecting a test-market location.

Question 8

Market cannibalization is the percentage of target market customers who purchased the product,which is often measured early in a test-market.

Question 9

A control method of test-marketing is a "minimarket test" in a small city,using control store distribution.

Question 10

Due to the similarities among Americans and Canadians,product success in the United States results in success in Canada.

Question 11

Expensive durable products are typically test-marketed before national introduction.

Question 12

Test-marketing is very expensive.

Question 13

Calculating a ratio of test product sales to total company sales in the area may provide a benchmark for modifying projections into other markets.

Question 14

The average test-market requires about twenty-four months.

Question 15

Cannibalized sales occur when consumers choose a new offering as a replacement for another product offered by the same company.

Question 16

Test marketing allows an organization to conduct a "trial run" of the product in the marketplace.

Question 17

A test market study involves the use of a controlled field experiment.

Question 18

The time length for a test market varies with the objectives of the test market.

Question 19

Selecting test-markets is,for the most part,a sampling problem.

Question 20

Intentional attempts to disrupt the results of a test-market being conducted by another firm is called guerilla marketing.

Question 21

Latin square designs assume that interaction effects are significant.

Question 22

A 3 x 3 factorial experiment requires six combinations of treatment groups.

Question 23

The manufacturer of the relatively higher-priced Dove chocolates introduced a lower-priced line of Dove chocolates with the intent of attracting consumers who did not normally purchase their higher-priced premium chocolates.However,most of the sales of the new product came from customers who would normally have purchased the existing higher-priced Dove products.This is an example of:

A)test-marketing
B)cannibalized sales
C)guerilla marketing
D)sales sabotage

Question 24

Which element of the marketing mix can be examined with a test-market?

A)product
B)price
C)promotion
D)all of the above

Question 25

If salespeople in a test-market city arrange for more shelf-facings than would normally be available to the product under normal store conditions,the test-market has the problem of:

A)media isolation
B)unrealistic store conditions
C)overuse
D)self-contained trading area

Question 26

Brad is a brand manager of a line of laundry detergent products in his company.His company's sales representative in Dayton,OH informed him that a competitor was conducting a test-market of a new line of strongly-scented laundry products.Brad knew from consumer research that consumers do not like overly strong scents,so he directed this sales representative to purchase all of the competitor's product in the stores in an attempt to make the product appear to sell well in the test-market so that the company will falsely believe that the product was successful.Brad's actions are called:

A)cannibalization
B)guerilla marketing
C)test-market sabotage
D)test-market deception

Question 27

All of the following are factors to consider in test-market selection EXCEPT:

A)product price
B)population size
C)media isolation
D)competitive situation

Question 28

The percentage of target market customers who purchased the product,which often is measured early in a test-market,represents:

A)market share
B)sales penetration
C)repeat purchases
D)market penetration

Question 29

In computing estimated market share for products for which repeat purchases are important in test markets,the correct formula is:

A)trial buyers - repeat purchase rate = market share
B)trial buyers + repeat purchase rate = market share
C)trial buyers/repeat purchase rate = market share
D)trial buyers x repeat purchase rate = market share

Question 30

Which of the following is a disadvantage of test-marketing?

A)cost
B)time
C)loss of secrecy
D)all of the above

Question 31

If a product is tried by 20 percent of the target market during test marketing,and the repeat purchase rate in this test market is 20 percent,the estimated market share for this product would be approximately:

A)0.4 percent
B)4 percent
C)40 percent
D)400 percent

Question 32

The average test-market requires about:

A)one month
B)six months
C)twelve months
D)two years

Question 33

All of the following are broad uses of test-markets EXCEPT:

A)forecasting the success of a newly developed product
B)testing hypotheses about different options for marketing mix elements
C)identifying weaknesses in product designs or marketing strategies
D)determining the suppliers of raw materials used in the production of the product

Question 34

A scientific procedure that allows a new product to be tested under realistic market conditions is called a:

A)test-market
B)market segmentation study
C)TQM
D)simulated test

Question 35

If salespeople in a test-market city spend an inordinate amount of time setting up and updating point-of-sale displays in supermarkets,this creates which type of problem?

A)overused test-markets
B)media isolation
C)overattention
D)self-contained trading areas

Question 36

When the gender of respondents (male,female)is thought to affect in important ways the dependent variable,an experimenter can attempt to block out the effect of gender on the results of the study.

Question 37

A test-market that is too ____ may ____ sales because typically the early adopters of new products are the heavy users of the product.

A)short;overestimate
B)short;underestimate
C)long;underestimate
D)long;overestimate

Question 38

Factorial designs allow researchers to measure interaction effects.

Question 39

All of the following are ways of projecting test-market results EXCEPT:

A)ratio of test product sales plus overall company sales to industry sales
B)straight trend projections
C)marketing penetration x repeat-purchase rate
D)consumer surveys

Question 40

Electronic test markets allow researchers to measure the impact of specific TV commercials on unit sales.

Question 41

Which of the following marketing functions is typically performed by the research agency in the control method of test-marketing?

A)distribution
B)warehousing
C)shelving in retail outlets
D)all of the above

Question 42

When salespeople in a test-market city spend much more time arranging the display of the product on supermarket shelves than they would normally once the product is introduced nationally is another way of saying that the product has received ____________________ during test-marketing.

Question 43

Sandy participated in a market research study that took place on a computer and she "shopped" by moving through the store using a computer mouse.She was even able to turn packages around to read the nutritional information on the back.This type of test-market is referred to as a(n):

A)electronic test-market
B)controlled test-market
C)real-time test-market
D)virtual-reality simulated test-market

Question 44

In which experimental design is a single,categorical extraneous variable that might affect test units' responses to the treatment identified and the effects isolated by being blocked out?

A)completely randomized design
B)randomized-block design
C)factorial design
D)interactive block design

Question 45

The control method of test-marketing is also known as:

A)forced distribution
B)a randomized block design
C)a simulated laboratory test-market
D)standard method of test-marketing

Question 46

The idea that distributors of the product should sell primarily in the test-market city is another way of saying that the test-market trading area should be ____________________.

Question 47

A researcher is interested in examining the effect of background music and lighting on sales in a restaurant,so he wants to conduct an experiment that manipulates different levels of each.Which experimental design would be best to examine the effects of these two treatments at various levels?

A)completely randomized design
B)randomized-block design
C)factorial design
D)interactive design

Question 48

Which of the following is an advantage of the control method of test-marketing?

A)increased secrecy from competitors
B)no distraction of company salespeople from regular product lines
C)reduced costs
D)all of the above

Question 49

A 3 x 2 experimental design requires ____ combinations of subgroup cells.

A)six
B)two
C)five
D)nine

Question 50

Which of the following is an experimental design that attempts to control or block out the effect of two or more confounding extraneous factors?

A)Latin square design
B)Solomon design
C)factorial design
D)blocking design

Question 51

____________________ is the percentage of target market customers who purchased the product and is often measured early in a test-market.

Question 52

Information Resources Incorporated (IRI)is a company that offers test-marketing systems that combine scanner-based consumer panels with high-technology broadcasting systems that enable the measurement of the immediate impact of commercial television viewing of specific programs on unit sales volume.These types of high-technology systems are called:

A)electronic test-markets
B)real-time test-markets
C)combination test-markets
D)synergistic test-markets

Question 53

A scientific testing procedure that provides an opportunity to measure sales for a new product under realistic market conditions is called a ____________________.

Question 54

Which type of test-market is a research laboratory in which the traditional shopping process is compressed into a short timespan?

A)controlled test-market
B)electronic test-market
C)simulated test-market
D)condensed test-market

Question 55

In which type of test-marketing situation does the company use its own sales force to try to obtain distribution of the product?

A)controlled-store test
B)standard method
C)randomized block design
D)simulated test-market

Question 56

When consumers choose a new offering as a replacement for another product offered by the same company,it is said to ____________________ sales.

Question 57

A 2 x 2 x 2 experimental design has ____ factors,each of which has ____ levels.

A)eight;three
B)three;two
C)three;eight
D)two;three

Question 58

An experimental design that uses a random process to assign subjects to treatment levels of an experimental variable is called a:

A)main effect design
B)completely randomized design
C)Solomon design
D)systematic design

Question 59

Obtaining distribution for a new product in a test-market is known as a(n):

A)market penetration
B)interaction effect
C)repeat-purchase rate
D)sell-in

Question 60

Which of the following rarely occurs in the control method of test-marketing?

A)desirable shelf location
B)out-of-stock conditions
C)interaction effects
D)sell-ins

Question 61

____________________ produce differences in the dependent variable between experimental cells based on combinations of variables.

Question 62

Discuss the problems of estimating national sales volume from test-markets.

Question 63

When a computer screen is used to simulate a retail store with images that allow a subject to "move" through different departments of the store and "purchase" products electronically is called a ____________________ simulated test-market.

Question 64

When subjects are randomly assigned to treatment groups to study the effects of manipulating an independent variable,this is called a(n)____________________ design.

Question 65

The control method of test-marketing is also called a " ____________________ " test.

Question 66

Blocking out the effect of two or more confounding extraneous factors in an experiment can be achieved by using a(n)____________________ design.

Question 67

Measuring the results of a test-market using UPC scanner data to measure market share along with cable TV systems that allow different ads to be shown to different customers is called ____________________ test-marketing.

Question 68

Discuss four methods of projecting test-market results.

Question 69

A(n)____________________ experimental design allows for testing of the effects of two or more treatments at various levels.

Question 70

A test-market study in which participants go to a laboratory and "shop" in a small room that resembles a supermarket aisle to estimate purchase rates is called a ____________________ test-market.

Question 71

In a factorial design,the influence of one independent variable on a dependent variable is called a ____________________.

Question 72

List the seven factors to consider in test-market selection.

Question 73

List the advantages and disadvantages of test-marketing.

Question 74

Compare and contrast completely randomized designs and randomized-block designs.

Question 75

A 3 x 3 experimental design incorporates ____________________ factors,each having ____________________ levels.