Question 1

The major purpose of test marketing is to provide management with the information needed to make a final decision about ________.

Accepted Answer

The major purpose of test marketing is to provide management with information to make a final decision on whether to launch the new product. Test marketing helps to gauge consumer response to the new product, determine optimal pricing and marketing strategies, and identify any potential challenges before a full launch.

Question 2

A new company designing and selling several lines of cellular phones has closely modelled its products after successful competitive products that are already in the marketplace.As it prepares to enter the market with its new products and services,which of the following should concern it the most?

Accepted Answer

The company should be most concerned with patent laws, as closely modelling its products after successful competitive products could potentially infringe on those products' patents. This could result in legal action and financial penalties.

Question 3

Once the prototype of a new ride-on lawnmower,made especially for women,passes product tests,the next step is ________.

Accepted Answer

The answer of Once the prototype of a new ride-on...

Question 4

Once managers of a firm have decided on their product concept and marketing strategy,they can evaluate the business attractiveness of the proposal in the ________ stage of the new-product development process.

Accepted Answer

The stage of the new-product development process where managers can evaluate the business attractiveness is the business analysis stage. This is where they conduct a thorough examination of the potential sales, costs, and profits associated with the product concept and marketing strategy. A feasibility study is a more in-depth analysis that is conducted during the business analysis stage to determine the practicality and potential success of the new product. Concept testing is done earlier in the process to gauge customer response to the product concept. Product acceptance is not a stage in the new-product development process.

Question 5

Under what circumstances might it be wise for a company to do little or no test marketing?

Accepted Answer

The answer of Under what circumstances might it be wise...

Question 6

In the ________ stage of new-product development,products undergo rigorous tests to make sure that they perform safely and effectively or that consumers will find value in them.

Accepted Answer

The product development stage is where the product is created, and it undergoes rigorous testing to ensure safety and effectiveness or value to the consumers before launching it into the market. Option A, business analysis, is the stage where the business analyzes the potential profitability of the product. Option B, idea generation, is the stage where business comes up with ideas for new products. Option C, concept development and testing, is the stage where the product concept is tested on a small scale, whereas Option E, marketing mix, refers to the 4Ps of marketing (product, price, promotion, place) that help in marketing the product once it's launched.

Question 7

Introducing a new product into the market is called ________.

Accepted Answer

Introducing a new product into the market is called commercialization. It involves launching the product in the market and promoting it among potential customers. A lot of effort goes into commercializing a product, including market research, branding, advertising, and sales promotions.

Question 8

In the early 1990s,Jarrah was the first brand in the Australian market to offer pre-prepared,instant coffee mixes in flat and frothy varieties.The brand featured exotic flavourings with cheeky names such as Cheeky 'Cino Cappuccino,White Choc-a-Mocha Latte,Mocha Truffle Latte,Vanilla Thriller Latte and Crème Caramel Latte.At the time,the launch was considered high risk and did not enjoy a big budget.Accordingly,the marketers devised a plan which involved a limited scale launch first in the regional Victorian town of Ballarat.Only when that was successful was the brand launched in Tasmania.Over time,the brand was launched in more and larger towns and cities around the country.The purpose of this was to gauge customer reactions,minimise the company's risk exposure,spread out investment outlays and fine tune elements of the marketing mix.This practice is best described as a planned ________.

Accepted Answer

The answer of In the early 1990s,Jarrah was the first...

Question 9

Which of the following costs is most likely associated with the commercialisation stage of new-product development?

Accepted Answer

The answer of Which of the following costs is most...

Question 10

Following the decision to 'time' the introduction of the new product,a company must decide ________ to launch the new product.

Accepted Answer

The answer of Following the decision to 'time' the introduction...

Question 11

Although test marketing costs can be high,they are often small when compared with ________.

Accepted Answer

Test marketing is done to check the market response and potential of a product before launching it on a large scale. Although it incurs costs, it can prevent major mistakes that can be very costly in the long run. Hence, the costs of a major mistake is often much higher than the cost of test marketing.

Question 12

Companies often do not test ________ or copies of successful competitors' products.

Accepted Answer

The answer of Companies often do not test ________ or...

Question 13

Telekom Communications is concerned about test marketing its new device.Which of the following is NOT a disadvantage of test marketing that would likely concern them?

Accepted Answer

This is not a disadvantage of test marketing that would concern Telekom Communications since they are not involved in surveying customers themselves. It is the market research firms that conduct the surveys and hence it is not a concern for Telekom Communications.

Question 14

Sony Music is conducting a business analysis to determine which of the many new songs available to management should be released.Estimates of sales must be prepared before costs can be estimated.Which of the following did your text recommend for forecasting sales?

Accepted Answer

The text recommends considering the sales history of similar products and conducting surveys of market opinions to forecast sales. This approach takes into account both past sales trends and current market opinions, which can help provide a more accurate estimate of future sales. Surveying competitors or applying the PLC concept may also be useful in certain situations, but considering sales history and market opinions is a more comprehensive approach. Option A is not enough to provide a complete picture of future sales and Option B only considers competitors, which may not accurately reflect the target market. Option E is not a viable answer as none of the options alone would provide a sufficient solution.

Question 15

Your firm added three new products earlier this year to increase variety for customers.Two of them failed to reach even minimal sales.Which of the following is LEAST likely to have been the cause of their failure?

Accepted Answer

Research being too extensive is the least likely cause of the failure because extensive research would have provided valuable insights about the market demand and customer preferences, which may have helped in developing the right product strategy.

Question 16

Once the product or service passes the business analysis test,it moves into what stage?

Accepted Answer

Once the product or service passes the business analysis test, it moves into the product development stage where a prototype or minimum viable product (MVP) is developed.

Question 17

Masport Industries will build a new prototype ride-on lawnmower especially for women.In the product development stage,they will incorporate the functional features and convey the ________.

Accepted Answer

In the product development stage, incorporating the intended psychological characteristics is crucial for tailoring the product to the target audience's preferences and perceptions, in this case, especially for women. This approach ensures the product resonates well with its intended users by addressing their specific needs and desires.

Question 18

A company getting ready to launch a new product must make several decisions.The company must first decide on ________.

Accepted Answer

The answer of A company getting ready to launch a...

Question 19

A Day Care centre plans to offer third-shift childcare,based upon the opening of two new manufacturing plants in the area.Together the plants will hire 450 employees and run all three shifts.Initial test marketing results look promising.In considering launching this new service,the firm must first decide on ________.

Accepted Answer

The answer of A Day Care centre plans to offer...

Question 20

BHP Steel lacks the confidence,capital and capacity to launch a new steel product into full national or international distribution.Even though test market results look promising,what will most likely be management's next step?

Accepted Answer

Since BHP Steel lacks the confidence, capital, and capacity to launch a new steel product into full national or international distribution, the best next step for management would be to develop a planned market rollout over time. This would allow them to build confidence and capacity gradually and allocate capital as needed. Retesting the product in additional markets may not address the fundamental issue of lack of capacity, and securing a loan may not be feasible without first proving the viability of the product. Seeking the help of a consultant or developing a prototype may also be useful, but they are not the most pressing next step for management.

Quiz 8: Products, Services and Brands: Building Customer Value