Question 1

The conditions during the beachhead phase of a launch cycle are highly conducive to good management.

Accepted Answer

The beachhead phase of a launch cycle often involves navigating through uncertainty and rapidly changing conditions, which can be challenging for management to handle effectively.

Question 2

Training of sales and other promotional people, building service capability, putting out preannouncements if they are in order, and arranging for stocking of a new product at the reseller level takes place during the _____ of a launch cycle.
A) announcement stage
B) prelaunch stage
C) early growth stage
D) late growth stage

Accepted Answer

These activities typically occur in the prelaunch stage, which precedes the actual announcement of the product. During this stage, companies prepare everything they need to introduce the product to the market, including training their sales force, developing marketing materials, and ensuring that the product is available for purchase by resellers.

Question 3

Selective distribution is typically used for products with low relative advantage and low compatibility with buyers' experiences.

Accepted Answer

Selective distribution is typically used for products with high relative advantage and high compatibility with buyers' experiences. This is because selective distribution allows for more control over the distribution process and can ensure that the product is only sold through reputable or specialized channels, thus enhancing the perceived value and credibility of the product.

Question 4

In a penetration price strategy, the price of a product is clearly low and is designed to buy one's way into the market.

Accepted Answer

A penetration price strategy involves setting a low price for a product to attract customers and gain market share. This low price may be temporary and is often used by new entrants to a market or for a new product launch.

Question 5

If product sales are dependent on sales of complementary products, _____ exists.
A) virtual network externalities
B) explicit network externalities
C) social network externalities
D) indirect network externalities

Accepted Answer

Indirect network externalities occur when the demand for a product is dependent on the demand for complementary products, leading to a network effect. This can create a situation where the value of a product increases as more people use complementary products, even if the product itself does not change.

Question 6

Skim is a very low price, intended to stay that way, with no clear product differentiation.

Accepted Answer

Skim pricing strategy involves setting high initial prices for a product to "skim" revenue layers from the market, not low prices. It typically targets customers willing to pay more at the launch of a product, not aiming for a low price point without differentiation.

Question 7

For products with low relative advantage and low compatibility with buyers' experiences, promotion should aid in risk reduction by offering money-back guarantees, warranties, or tie-ins to existing products.

Accepted Answer

When products have low relative advantage and low compatibility with buyers' experiences, customers may perceive them as risky or uncertain purchases. To address this, promotion strategies can focus on reducing perceived risk by offering money-back guarantees, warranties, or tie-ins to existing products. This can help encourage consumers to try the product and increase their confidence in its quality and value.

Question 8

Five Works Inc. preannounces the release of its computer software, but the product is never launched in the market. This is an example of _____.
A) a market rollout
B) vaporware
C) stocklifting
D) a lean launch

Accepted Answer

This situation is an example of vaporware, which refers to software that is announced or advertised but never actually released to the market.

Question 9

A customer-based sales organization requires more of the hard-sell pushing that product-based sales forces can provide.

Accepted Answer

Customer-based sales organizations focus on building relationships with customers and understanding their needs, rather than pushing products. Therefore, they require a softer approach that focuses on providing solutions instead of hard-sell techniques. Product-based sales forces may utilize more hard-sell techniques because their emphasis is on promoting the features and benefits of a specific product.

Question 10

The launch cycle of a new product typically begins with the beachhead phase.
FALSE

Accepted Answer

The launch cycle of a new product typically begins with the ideation and research phase, followed by development, testing, and commercialization. The beachhead phase is a marketing strategy used after the product has been launched to establish a strong presence in a particular market segment.

Question 11

In the context of launching a new product, proficient implementation of launch tactics is related to improved new product performance.

Accepted Answer

Proficient implementation of launch tactics can create awareness, generate interest, and drive sales for the new product, resulting in improved new product performance.

Question 12

Before the commercialization of a new product, the sales force of Seriv Corporation plans to give its suppliers a hint that a new product or an advanced version of an existing product is going to be launched by the end of the year. The firm's action can be seen as an example of _____.
A) signaling
B) corporate espionage
C) beachheading
D) whistleblowing

Accepted Answer

Seriv Corporation's action of giving its suppliers a hint about a new product launch can be seen as an example of signaling. Signaling involves actions taken by a firm to convey information to others, usually to signal its intentions or capabilities. In this case, Seriv Corporation is signaling to its suppliers that it is planning to launch a new product or an advanced version of an existing product by the end of the year. This can help the firm build anticipation and generate interest in the new product among its suppliers and potentially customers.

Question 13

Preannouncement of an upcoming product can be used to block a competitive entry.

Accepted Answer

By preannouncing an upcoming product, a company can create anticipation and excitement among customers, which could lead to them waiting to purchase the new product instead of opting for a competitor's product. This can potentially block the entry of a competitor into the market.

Question 14

Indirect network externalities exist if product sales are dependent on the number of people that have adopted it.

Accepted Answer

Indirect network externalities refer to the benefits received from complementary goods or services increasing as more people use an initial product, not directly from the number of people who have adopted the initial product itself.

Question 15

When a new product launch involves a defensive addition, the appropriate tactics include a broad product assortment, a new brand name and distribution channels, and a higher price.

Accepted Answer

A defensive addition typically involves strategies such as matching the competitor's offerings, using existing brand names and distribution channels to leverage brand loyalty and efficiency, and pricing strategies that may involve meeting or beating competitor prices, rather than introducing a broad product assortment, new brand names, and higher prices which are more aggressive tactics.

Question 16

A key requirement for a new product trial is that it must have some cost associated with it for the firm.

Accepted Answer

A key requirement for a new product trial is that it must have some cost associated with it for the firm. This cost may include expenses associated with production, marketing, distribution, or other factors. Without a cost, the trial may not accurately reflect the market conditions and potential profitability of the product.

Question 17

In a product launch setting, beachhead refers to the heavy expenditures necessary to overcome sales inertia.

Accepted Answer

Beachhead refers to the initial market penetration strategy that involves concentrating resources in a limited geographic area or market segment to establish a strong foothold before expanding into other areas. It does not refer to heavy expenditures to overcome sales inertia.

Question 18

The trial phase in the adoption of new products is the stumbling point for most products that fail; and it is the cause of winning products not winning a great deal more.

Accepted Answer

The statement is true. Many products may perform well in concept testing or even pre-launch research, but may not translate into actual sales due to difficulties in the trial phase.

Question 19

In most cases, repeat purchase is the last step toward adoption of a new product.

Accepted Answer

Repeat purchase is a key indicator of product adoption, as it suggests that the customer has found value in the product and is likely to continue using it.

Question 20

A launch cycle is an expansion of the _____ of the product life cycle into substages.
A) maturity stage
B) introductory stage
C) growth stage
D) evaluation stage

Accepted Answer

The launch cycle is a specific substage in the introductory stage of the product life cycle, focused on introducing and promoting the product to the market. It includes activities such as product development, market research, advertising, and distribution. Therefore, the best choice is B, the introductory stage.

Quiz 15: Implementation of the Strategic Plan