Question 1

Compatibility refers to the degree to which the innovation matches the values and experiences of the individuals.

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Question 2

Beta testing tests the product within the firm to see how it performs in different applications.

Accepted Answer

Beta testing is done by external users outside of the firm to test the product and provide feedback on its performance.

Question 3

Sales-wave research can be implemented quickly and carried out without final packaging and advertising.

Accepted Answer

Sales-wave research primarily focuses on studying consumer behavior and buying patterns in real-time, which can be performed quickly without the need for final packaging and advertising. This helps companies to quickly analyze the market demand for their product and make necessary refinements before launching it officially.

Question 4

Some firms might delay new product launch until after the competitor has borne the cost of educating the market and its product may reveal flaws the late entrant can avoid.This can be classified as a parallel entry.

Accepted Answer

This strategy is known as a "late mover advantage" or "second mover strategy," not a parallel entry. Parallel entry refers to firms entering a market at the same time, whereas this describes entering after a competitor to capitalize on their initial efforts and mistakes.

Question 5

Explain how stage-gate systems are used by companies to manage innovation and new product launches.

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Question 6

Expensive industrial goods and new technologies will normally undergo alpha and beta testing.

Accepted Answer

It is true that expensive industrial goods and new technologies will normally undergo alpha and beta testing before they are released to the market. Alpha testing is done in-house by the manufacturer to identify any major issues or defects, while beta testing involves real-world testing by potential customers to provide feedback and identify any remaining issues before a final product is released.

Question 7

What is the consumer-adoption process? What are the various steps in the process?

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Question 8

What does the term organic growth mean?

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Question 9

Briefly explain the three choices available to companies when deciding the timing of market entry.

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Question 10

What are the types of new products that a firm can introduce? What are the problems associated with introducing a truly innovative product? What are the necessary conditions to create a radically innovative product?

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Question 11

Cannibalized income is the increased income on other company products resulting from adding this product to the line.

Accepted Answer

Cannibalization refers to the negative impact of introducing a new product on the sales of existing products within the same company. It does not result in increased income on other company products.

Question 12

Survival-age distribution refers to the number of customers that the product has in year one,two,three,and so on.

Accepted Answer

Survival-age distribution typically refers to the distribution of ages at which individuals (not products) survive to or the distribution of survival times in a population, not the number of customers a product has over various years.

Question 13

Explain the concepts of sales-wave research and simulated test marketing.

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Question 14

What is concept testing? What is its importance? Explain two modern techniques used for concept testing.

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Question 15

At the interest stage of consumer-adoption process,the consumer becomes aware of the innovation but lacks information about it.

Accepted Answer

At the interest stage, the consumer has already become aware of the innovation and seeks information about it. The awareness stage is where the consumer first learns of the innovation but lacks information.

Question 16

Explain three techniques for stimulating creativity to generate better ideas.

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Question 17

A business analysis is typically performed after the management has developed the product concept and marketing strategy.

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Question 18

How do companies organize new product development?

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Question 19

Identify the major reasons why new product failures occur.

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Question 20

Dragalong income refers to additional income whereas cannibalized income refers to reduced income.

Accepted Answer

Dragalong income refers to income generated from ancillary products or services that are sold along with the main product or service, whereas cannibalized income refers to the loss of revenue caused by the introduction of a new product or service that competes with an existing one. Therefore, dragalong income is additional income while cannibalized income is reduced income.

Quiz 21: Introducing New Market Offerings