Deck 7: Product Strategy and New-Product Development

Question 1

Competitors still enter the maturity stage of the product life cycle because there is still an opportunity for success of a niche product.An example of this was when Audi entered the SUV market during its maturity stage.

Answer 1

True

Question 2

A stock keeping unit (SKU)is a unique identification number used to track a product in the consumer's home.

Answer 2

False
Explanation: An SKU is a unique identification number used to track a product through a distribution system, inventory management, and pricing.

Question 3

The new-product development process can be described in three steps: (1)identify product opportunities,(2)define the marketplace parameters for the possibility of government regulation,and (3)develop the product opportunity.

Answer 3

False
Explanation: The new-product development process consists of three main activities: (1) identify product opportunities, (2) define the product opportunity, and (3) develop the product opportunity.

Question 4

BMW has used the concept "Ban Boredom" as one of the key benefits of its MINI line.For the people in the MINI's target market,this is an attractive benefit.

Question 5

Luxury cars such as the Chevrolet Corvette are available with tires that enable the driver to continue driving even after the tire has been damaged.This is an example of Corvette using style as a differentiator.

Question 6

Everyone in a target market falls into one of five groups based on their willingness to try the innovation,including innovators,early adopters,early majority,late majority,and laggards.

Question 7

When consumers purchase a product for the purpose of making a value decision in the product adoption process,it is called the trial stage.

Question 8

Product life cycle (PLC)includes four basic stages: introduction,growth,maturity,and decline.

Question 9

The maturity stage of the PLC is characterized as having a few large players dominate the market followed by a number of smaller companies with specific products meeting specialized market needs.

Question 10

Style is very difficult to assess.Firms do not use style often in as much as it is easy to copy.

Question 11

The business case analysis is an overall evaluation of a product and usually assesses the product's probability of success.

Question 12

The number of products purchased by the same customer is called repeat purchases.This can be important with things like stereos and cell phones because they rely on loyalty for success.

Question 13

One of the disadvantages of using style as a discriminator is that consumer tastes change over time and what is considered stylish can quickly lose its appeal.

Question 14

The essential benefit is the fundamental need met by the product.

Question 15

Late majority are product followers that are price-sensitive and risk-averse.

Question 16

Brand-new technologies are what people often consider a "new product." An example of this is the group of companies working on harnessing the wave action of the oceans off the Scottish coast and other rough sea areas.

Question 17

An individual moves through five stages before adopting a product,including awareness,interest,trial,testing,and adoption.

Question 18

Early adopters are opinion leaders who seek out new products but are price-sensitive to innovation.

Question 19

Parents buying their daughter a pair of jeans would probably consider Aeropostale jeans to be just another pair of jeans; however,to the teenager,the same purchase makes an important statement about herself and her choice of clothes.

Question 20

Sometimes a company can make a product that is too reliable.An example of this would be a computer that cost a large premium over competition but would last for years.The problem is that technology changes too rapidly so better,cheaper,and faster models will come out and make the expensive,long-lasting model obsolete.

Question 21

Products that consumers purchase that are relatively low cost,purchased frequently,and lacking some amount of interest by the customer are called __________.

A)Shopping goods
B)Convenience goods
C)Specialty goods
D)Unsought goods
E)Consenting goods

Question 22

Tangibility refers to __________.

A)The service delivered with the product
B)The ability to create a combination of product and service
C)The physical aspect of a product
D)The value of the product in the market
E)None of these

Question 23

Companies translate the essential benefit into physical,tangible elements known as the _________.

A)Augmented product
B)Core product
C)Deviated product
D)Differentiated product
E)Contrasting product

Question 24

The product experience is called the ________.

A)Tangible asset of marketing space
B)Focus of consumer attributes
C)Heart of marketing
D)Soul food of marketing
E)All of these

Question 25

A product line is a group of products linked through usage,customer profile,price points,and distribution channels.Within a product line,strategies are developed for ________.

A)One product in the line at a time
B)All the different product lines taken together
C)A single product, but also for all products in the line
D)The top two products in the line and all the rest lumped together in one campaign
E)None of these

Question 26

More than any other discriminator,style offers the advantage to a company of _______.

A)Being a low-cost differentiator
B)Being easy to do consistently over time
C)Being able to reduce quality with greater style
D)Being difficult for competition to copy
E)All of these

Question 27

An example of an "essential benefit" of a plane ticket is _______.

A)Getting the lowest price possible by shopping BOTS
B)Getting a person to buy from a particular airline
C)Getting a person from one place to another
D)Getting a person to think about the food, liquor, and baggage handling of the airline
E)Getting the person to buy based on unessential items in the product offering

Question 28

When a company creates a product that extends,enhances,and encourages the customer beyond delivering its core,this concept is called _______.

A)Product extension
B)Product deviation
C)Product subordination
D)Product clustering
E)Product enhancement

Question 29

Clothes,furniture,and major appliances are called shopping goods.This category of good implies that ________.

A)Consumers do more research prior to buying
B)They are purchased less frequently
C)They cost more and carry a fear of making a wrong decision
D)They have a variety of choices on prices and features
E)All of these

Question 30

When a company can show that its product's projected lifetime is high under certain operating conditions,it is using _____ as a differentiator.

A)Style
B)Performance Quality
C)Form
D)Durability
E)Conformance Quality

Question 31

_____ are unique purchases made based on a defining characteristic for the consumer.The characteristic might be a real or perceive product feature such as Apple iPhone's easy user interface.

A)Shopping goods
B)Convenience goods
C)Specialty goods
D)Unsought goods
E)None of these

Question 32

The Apple Newton,the first PDA,is a good example of a product that _______.

A)Was technically inferior to the competition
B)Was priced too low to have a good image in the market
C)Was technically better than competition but still unsuccessful
D)Had great connectivity to other computers
E)All of these

Question 33

When product is defined in a marketing context,it is _________.

A)The physical tangible product
B)A bundle of demand and supply issues
C)The total asset balancing between buyer and seller
D)The total product experience
E)All of these

Question 34

Today many tangible products have a component that impacts the customer's satisfaction before and after the purchase.This component that complements the tangible aspects of the product is called __________.

A)Physical aspects
B)Supply chain
C)Monetary characteristics
D)Intangible characteristics
E)Total emergence

Question 35

An important issue for consumers is conformance,which is the product's ability _________.

A)To deliver on features and performance characteristics promised in marketing communications
B)To conform to the standards set by the federal guidelines
C)To deliver value in the form of product quality
D)To get the manufacturing aligned using quality processes
E)All of these

Question 36

Generally speaking,a new product will get ________ level of budget with respect to communication than (as)established products.

A)A lower
B)The same
C)A mid
D)A higher
E)None of these

Question 37

Companies often use features to differentiate themselves from competitors.However,a company must balance the features customers want with __________.

A)What the competition is doing
B)The ability to manufacture the feature in a timely way
C)What they will pay at a given quality level
D)The configurations that make a positive brand look stylish
E)None of these

Question 38

There is a category of goods called unsought goods.These goods are characterized as being the kinds of things that consumers _______.

A)Want to be completely convenient to them
B)Do more research on and compare across product dimensions such as color, size, features, and price
C)Frequently purchase and have little interest in seeking new information about
D)Would rather not purchase at all
E)None of these

Question 39

Combining all the products offered by a company is called the ___________.

A)Product combination package
B)Product mix
C)Product profile
D)Product standardization
E)Product function

Question 40

Companies must balance the number of items in a product line.Too many items and customers find it difficult to see the differences between the products.Too few products and the company runs the risk of _______.

A)Having inefficiencies in production
B)Having trouble with discounters because they may have the same product as a full-price store
C)Having a problem with communication to the market about the products
D)Missing important market opportunities that are not being attacked by the current product offerings
E)None of these

Question 41

The first stage of the maturity phase of the PLC is characterized as having _________.

A)Growth, but at a rate lower than the growth stage
B)No growth
C)Loss of sales
D)Growth at an increasing rate in comparison to the growth stage
E)None of these

Question 42

As models proliferate and market segmentation becomes more pronounced,companies seek __________ distribution for their products.

A)Limited
B)Selective
C)Broader
D)Maximum
E)None of these

Question 43

In the growth phase of the PLC,marketing communications _______.

A)Inform and educate the target audience about the product's features and benefits
B)Face the challenge of deciding between short-term sales promotions or investing more in the brand
C)Link the brand with key product features and highlight differentiation between competitors
D)All of these
E)None of these

Question 44

Products that are new-to-the-world create a product situation that can be described as ______________.

A)Supply chain shifting
B)Innovation by intimidation
C)Diluted innovation
D)Disruptive innovation
E)None of these

Question 45

Early in the maturity phase of the PLC,the product reaches its ________ distribution with respect to the variety of outlets targeted.

A)Minimum
B)Stable
C)Maximum
D)Selective
E)None of these

Question 46

Products introduced in the growth phase tend to have __________.

A)Fewer features and better design
B)Differentiated function
C)More features and better design
D)Limited design and more features
E)None of these

Question 47

Informing and educating the target audience about the product's benefits,characteristics,and features is part of the communication strategy in the ___________ phase of the product life cycle.

A)Introduction
B)Growth
C)Maturity
D)Decline
E)All of these

Question 48

The product life cycle (PLC)for a particular product has ________.

A)More than one life cycle-industry and brand life cycles
B)One life cycle for all brands combined
C)Life cycles that resemble normal curves
D)An evolutionary phase that defines when to offer a new product
E)None of these

Question 49

It is not uncommon to see ________ profits in the introduction phase of the product life cycle for an industry.

A)High
B)No (or loses)
C)Average
D)Low
E)None of these

Question 50

In the final stage of the maturity phase of the PLC,the market _______.

A)Picks up steam as it moves to the decline stage
B)Begins to feel the pressure of overcapacity and the market starts to lose customers
C)Begins to see price-only buyers move in and challenge existing producers to add more features to the product
D)Begins to feel the pressure of global manufacturing and moves to go international
E)None of these

Question 51

Generally speaking,the most dramatic increase in revenue occurs in the _________ phase of the PLC.

A)Introduction
B)Growth
C)Maturity
D)Saturation
E)Decline

Question 52

One way to extend the product is by creating ___________.

A)Additions to existing product lines
B)New names for the same products
C)Products from a different industry to your industry
D)Products that look like the competitions' but are not really different than the competitions'
E)None of these

Question 53

The essential marketing objective in the growth phase of the PLC is to ____________.

A)Build trial of the product
B)Build public relations for the product
C)Build trial followed by loyalty
D)Differentiate the product from those of new competitors
E)All of these

Question 54

In the introduction phase of the PLC it is important to _________.

A)Inform and educate the target audience about the product's features and benefits
B)Link the brand with key product features and highlight differentiation between competitors
C)Work to further differentiate the product from those of competitors
D)Decide whether to invest further in the product or allocate funding to a new project(s)
E)Target the high-end market with a differentiated product and higher price point

Question 55

In the decline stage of the PLC,price is pressured as a result of _______.

A)Consumers forgetting about the brand
B)New companies forging ahead in the market and offering lower prices to gain market share
C)Suppliers giving the firm price concessions, but not helping with the reduction in market size
D)Competitors dropping price and costs remaining high due to lower sales volume
E)None of these

Question 56

In the _________ phase of PLC,sales continue to increase but at a decreasing rate.

A)Maturity
B)Growth
C)Introduction
D)Decline
E)None of these

Question 57

The objective in the introduction phase of the product life cycle (PLC)is to _______________.

A)Differentiate the product from those of new competitors, promoting rapid expansion
B)Transition the product from high growth to sales stability
C)Build market awareness for the product, leading to trial purchase
D)Determine the future of the product
E)All of these

Question 58

New-to-the-world products are products that _______.

A)Have been available before but are recycled
B)Are innovative but only slightly different than previous products
C)Have not been available before their introduction to the market
D)Are not disruptive to the marketplace
E)None of these

Question 59

When products like cell phones have been aimed as a safety device for working women and moms,one way to find "new" markets is to _________.

A)Add features to the phones
B)Sell added benefits to the existing customers
C)Reposition the existing products to new markets
D)Alter the billing so more people can afford the product
E)All of these

Question 60

When new-to-the-world products are better,faster versions of existing products that target,for the most part,existing customers,it is said that these products are ___________.

A)Neo innovations
B)Subtle innovations
C)Left-handed innovations
D)Sustaining innovations
E)None of these

Question 61

Customers view new products much differently than companies.Customers care only if the product is ______.

A)New to their retail store
B)New to them
C)Offered through a new outlet
D)Offered online instead of at a brick-and-mortar store
E)None of these

Question 62

The third stage of the new-product development cycle is _________.

A)Define the product definition
B)Define the product opportunity
C)Define the total value proposition of the cycle
D)Define the trim and vigor of the new concept
E)Define the Google search potential for the new product

Question 63

Firms must _________ new-product ideas from the list of ideas that are generated by the idea generation stage.

A)Rank order
B)Screen and evaluate as quickly as possible
C)Develop a business plan for
D)Develop a scale model for
E)All of these

Question 64

A stop-to-market mistake happens when __________.

A)A bad idea is allowed to make it to market
B)The screening committee decides to market a product that has a fatal flaw
C)A good idea is pushed forward without knowing the ROI of its execution
D)A good idea is prematurely eliminated during the screening process
E)None of these

Question 65

Beta testing is designed to __________.

A)Encourage customers to evaluate and provide feedback on the prototype
B)Let engineers inside the company to test the product performance
C)Give fake information to competitors about the new product
D)Let online communities discuss and dissect the new product
E)None of these

Question 66

Many organizations are too small to have a national sales force to help discover new-product ideas.As a consequence they often use _______ that offer a link between the customer and company.

A)Distributors
B)Parts manufacturers
C)Logistics companies
D)Server farms
E)None of these

Question 67

In the B2B market,test marketing is ________.

A)Identical to the B2C market
B)Smaller in scope and involves fewer individuals and companies
C)Larger in scope and involves more individuals and companies
D)Extremely different than B2C because of the magnetic variance of the enterprises
E)None of these

Question 68

The business case analysis stage is important because ________.

A)Not a lot of money has been spent on the new product until this point of the new-product development process
B)It represents another low-cost analysis prior to developing a prototype product
C)The firm has already decided to take this product to the market and this analysis must confirm this action
D)A, B, and C
E)None of these

Question 69

Time to market is a term that means _________.

A)This is the best time to market this new product
B)It is time that the company had an entry into a particular market segment
C)How long it will take to develop and get the product to market
D)How long it will take to get the product through the introduction stage to the growth stage
E)None of these

Question 70

Total demand is a function of three separate situations,which can be described as ___________.

A)New, ideal, and impulse purchases
B)New, repeat, and replacement purchases
C)New, repeat, and impulse purchases
D)New, impulse, and replacement purchases
E)New, convenient, and impulse purchases

Question 71

Market testing can take a long time,and this can result in ________.

A)Competitors being able to develop marketing strategies to counter a product launch
B)The company losing the excitement of a new product
C)Competitors being able to sabotage the firm's efforts
D)Online guerrilla tactics by competitors that will disrupt the sales cycle of the product
E)None of these

Question 72

New purchases of new products are called _______.

A)Original purchases
B)Subliminal purchases
C)Purchase novelties
D)Trial purchases
E)All of these

Question 73

Products that start poorly in a product launch __________.

A)Seldom recover from the poor launch
B)Recover readily through increased marketing effort
C)Have a life cycle that looks very elastic
D)Have a knack for being the market leader through slow but steady growth
E)None of these

Question 74

________ is the focus of a product launch marketing plan,because if you can get consumers to try the product,you can win them over with superior product design,features,and value.

A)Adoption
B)Trial purchase
C)Interest
D)Evaluation
E)Awareness

Question 75

Success or failure of a new product is determined by the action of the company.The factor or factors that increase the likelihood of failure can be described as _______.

A)Poor marketing communications
B)Failure to meet customer expectations
C)Incorrect pricing
D)Failure to identify the value proposition
E)All of these

Question 76

One challenge facing companies is to generate new ideas for products.A good source for new-product ideas come from internal employees from ________.

A)R&D
B)Marketing
C)Manufacturing
D)All of these
E)None of these

Question 77

An individual purchases the product for the purpose of making a value decision.He is in the _____ stage of the product adoption process.

A)Awareness
B)Interest
C)Trial
D)Evaluation
E)Adoption

Question 78

An individual moves through five stages before adopting a product.The five stages include all of the following except ____.

A)Awareness
B)Interest
C)Information search
D)Evaluation
E)Adoption

Question 79

Many times customers provide ideas to salespeople,customer service representatives,and other direct customer contact people in the firm.These type of inside people and customers are generally good at generating ideas that are ________.

A)Game-changing products
B)Innovative leaps in design
C)Incremental changes to existing products
D)Challenging for R&D due to their aggressive nature
E)None of these

Question 80

The rate at which new products become accepted is known as the _________.

A)Product variance process
B)Product sensitivity process
C)Product adoption process
D)Product steering process
E)None of these