Question 1

One of the key characteristics of brainstorming sessions is that bad ideas should be immediately rejected so the group can focus its attention on good ideas.

Accepted Answer

One of the key characteristics of brainstorming sessions is to encourage and welcome all ideas, regardless of how bad or unconventional they might seem. The goal is to generate as many ideas as possible without any criticism or judgment, and then refine and select the best ones later on.

Question 2

Test marketing refers to customers who modify existing products according to their own ideas to suit their specific needs.

Accepted Answer

Test marketing refers to the process of introducing a new product to a limited market to gauge its success before wider release. The statement describes the concept of user innovation or customization.

Question 3

The maturity phase of the product life cycle is characterized by greatly reduced competition.

Accepted Answer

The maturity phase of the product life cycle is actually characterized by increased competition, as the market becomes saturated and competitors begin to offer similar products.

Question 4

To determine whether a new product is commercially viable, a firm can conduct premarket testing.

Accepted Answer

Premarket testing is a commonly used method to gauge the potential success of a new product before it is officially released to the market.

Question 5

On the diffusion of innovation curve, the first group of buyers who want to be the first on the block to have the new product are known as early adopters.

Accepted Answer

The first group of buyers who want to be the first to have the new product are known as "innovators." Early adopters come after innovators on the diffusion of innovation curve.

Question 6

New-to-the-world products that create new markets can add tremendous value to firms.

Accepted Answer

New-to-the-world products that create new markets can bring in significant profits to firms by tapping into uncharted markets and meeting the needs and desires of previously untapped customer segments.

Question 7

On the diffusion of innovation curve, the late majority is the final group of buyers that like to avoid change and rely on traditional products until they are no longer available.

Accepted Answer

The answer of On the diffusion of innovation curve, the...

Question 8

The diffusion of innovation curve follows the following sequence: innovators, early majority, early adopters, late majority, and laggards.

Accepted Answer

The correct sequence is innovators, early adopters, early majority, late majority, and laggards.

Question 9

When consumers see their friends using an innovation, it often persuades them to try it too.

Accepted Answer

This phenomenon is known as social proof or social influence, and research has shown that seeing others use a product or service can increase an individual's likelihood of adopting it.

Question 10

The most challenging part of applying the product life cycle concept is that managers do not know exactly what shape each product's life cycle will take.

Accepted Answer

The product life cycle concept is a general framework that describes a typical pattern of sales and profits for a product over time. However, there are many factors that can affect the duration and shape of each product's life cycle, such as changes in consumer trends, technological advancements, or competitive pressures. Therefore, managers cannot predict with certainty how long each stage of the life cycle will last, or how steep or gradual the curve will be. They must constantly monitor the market and adjust their strategies accordingly.

Question 11

The fact that the Apple iPad is easy to try-demo units are available at Apple stores as well as other retail stores-is helping it to diffuse more quickly.

Accepted Answer

The statement is true as availability of try-demo units at Apple stores and other retail stores makes it easier for potential customers to test the product and thus increase its diffusion.

Question 12

Fashion trends tend to experience short product life cycles.

Accepted Answer

Fashion trends are known for being short-lived, which means that they experience short product life cycles. A product life cycle is the progression of a product from its introduction to the market, through its growth phase, maturity phase, and eventually its decline phase. In the case of fashion trends, the growth and maturity phases tend to be very short, as new trends are constantly emerging and replacing old ones. This means that fashion products have a shorter lifespan compared to other products that go through longer growth and maturity phases before declining.

Question 13

When Glenn asked a few of his regular customers to test his prototype surfboard, he was engaging in alpha testing.

Accepted Answer

The answer of When Glenn asked a few of his...

Question 14

New product development adds value to a firm's products and services through innovation.

Accepted Answer

New product development involves creating and introducing innovative products or services that add value to a firm's existing offerings. This can generate new revenue streams and increase customer satisfaction and loyalty, ultimately benefiting the company's bottom line.

Question 15

As personal computers became popular, the sale of typewriters decreased significantly and now typewriters are only used by a very small segment of consumers. Typewriters are in the maturity stage of the product life cycle.

Accepted Answer

Typewriters are in the decline stage of the product life cycle, not the maturity stage, due to the significant decrease in their use and the shift towards personal computers and digital technology.

Question 16

Even if products succeed, not all consumers adopt new-to-the-world products at the same time.

Accepted Answer

This statement is true. Even if a product succeeds, some consumers may adopt it immediately, while others may take more time to warm up to the idea of a new-to-the-world product. Factors such as pricing, distribution, and marketing can all influence the rate of adoption among different consumer groups.

Question 17

The majority of new products are failures.

Accepted Answer

According to research, around 80-90% of new products fail within a year of launch.

Question 18

Although innovation strategies may not work in the long run, overriding short-term reasons compel firms to introduce new products and services.

Accepted Answer

The answer of Although innovation strategies may not work in...

Question 19

When the iPad Mini came out, Sasha spent the night in front of the store so she could get one before any of her friends. According to the diffusion of innovation, Sasha is an innovator.

Accepted Answer

Innovators are people who are the first ones to adopt a new product or technology. They are willing to take risks and spend time and money on new innovations. Sasha's behavior of waiting overnight to get the iPad Mini before anyone else demonstrates innovator behavior.

Question 20

A product will likely remain in the maturity stage of the product life cycle until a superior product comes along to replace it.

Accepted Answer

This is because in the maturity stage, sales growth has already peaked and is beginning to slow down. However, the product still has a significant share of the market and can continue to generate profits for the company. It will only be replaced by a superior product that offers more value to the customers, thereby attracting them away from the existing product.

Quiz 12: Developing New Products