Question 1

According to the diffusion of innovation theory, buyers belonging to the early majority group are considered crucial because:

Accepted Answer

The early majority group is crucial because they represent a significant portion of the market and their adoption of a product can greatly affect its profitability and success. They help the product reach a tipping point in market penetration.

Question 2

Companies try to create a broader portfolio of products.Which one is NOT true about this strategy?

Accepted Answer

Creating a broader portfolio of products may not necessarily work better in industries that rely on fashion trends. In such industries, launching too many products may dilute the brand and confuse consumers. Therefore, it is important to strategically select products to ensure they align with the overall brand image and consumer preferences rather than constantly introducing new products.

Question 3

The process by which ideas are transformed into new products and services that help firms grow is known as:

Accepted Answer

The given definition clearly describes the process of innovation, which involves the transformation of ideas into new products and services that provide a competitive edge to the firms. Prototyping is a stage within the innovation process where a working model is developed to test the feasibility of the idea. Diffusion and adoption refer to the spread and acceptance of new products/services in the market. Brainstorming is a technique used to generate creative ideas during the innovation process. Therefore, option B (innovation) is the best choice.

Question 4

The category of buyers that waits and purchases a product after careful review is called:

Accepted Answer

Early adopters are typically the first wave of buyers who are willing to take a chance on a new product or technology, but they still do so after careful review and consideration. They are more cautious than innovators, who buy new products without much research, but are still faster to adopt than the majority of buyers who wait until a product is well-established before making a purchase (late majority and laggards). Lead users are a separate category of buyers who actively seek out new solutions to their needs and may even create their own custom solutions, so they are not the best choice in this scenario.

Question 5

Firms that invest in the latest technology, either to use in their new products or services or to make the firm more efficient, are considered:

Accepted Answer

Firms that invest in the latest technology, either to use in their new products or services or to make the firm more efficient, are considered innovators. Innovators are those who are the first to introduce new technologies and products into the market. They are willing to take risks and are highly motivated by the potential rewards of being the first mover in a new market.

Question 6

Which of the following is an advantage for product pioneers in new product introductions?

Accepted Answer

Being the first to introduce a product often allows pioneers to become highly recognizable and establish brand recognition early, which can be a significant advantage in the market.

Question 7

The category of buyers that tends to enjoy novelty and is regarded as opinion leaders for particular product categories and spreads the word are called:

Accepted Answer

The category of buyers described as enjoying novelty and being opinion leaders for particular product categories are early adopters. They are the first to try new products and services, and their opinions are highly respected by others. Innovators are the first to adopt new products, while the early majority and late majority follow suit after the product has been proven successful. Laggards are the last to adopt new products and are often resistant to change.

Question 8

Which of the following is an example of a product in a fashion industry?

Accepted Answer

Sea of Thieves is a video game, which is not a product in the fashion industry. All the other options are products in the fashion industry.

Question 9

A new product might be failed for all the following reasons EXCEPT:

Accepted Answer

Being a disruptive innovation is not a reason for a new product to fail. In fact, disruptive innovations often succeed precisely because they offer new and unique solutions to consumer problems. The other options listed (inappropriate product testing, targeting the wrong segment, poor positioning, and bad timing) are all common reasons why new products may fail.

Question 10

The group of buyers that acts as opinion leaders and is responsible for bringing the early majority, late majority, and laggard groups into a market is the:

Accepted Answer

The group of buyers that acts as opinion leaders and responsible for bringing the early majority, late majority, and laggard groups into a market is the early adopters. Innovators are the first group of buyers to adopt a new product, pioneers are companies that introduce a new product into the market, lead users are innovative customers who modify existing products to suit their specific needs, and laggards are the last group of buyers to adopt a new product.

Question 11

Early adopters differ from innovators in that early adopters:

Accepted Answer

The answer of Early adopters differ from innovators in that...

Question 12

Innovators are crucial to the success of any new product or service because:

Accepted Answer

Innovators are crucial to the success of any new product or service because they help the product or service gain market acceptance.

Question 13

Jeremy is interested in buying a phone that has a music player and provides access to the Internet.After doing a detailed analysis of all the phones in the market that offer these features, he decides to buy a recently released model.Which of the following groups of buyers best represents Jeremy's buying behaviour?

Accepted Answer

Jeremy's buying behaviour suggests that he is an early adopter - someone who is willing to try out new products and technology before most other people. He has researched all the available options and has chosen a recently released model, indicating a willingness to take risks and try something new. Innovators are even more adventurous than early adopters and are typically the first to buy a new product, while the early majority and late majority are both more cautious in their buying behaviour and prefer to wait until a product has become more established before investing in it. Laggards are reluctant to embrace new technology and may never adopt it at all.

Question 14

Scott wants to buy a cell phone that operates with the Android operating system (OS), but he decides to wait until more cell phone companies release models with the Android OS.This way, a lot of user reviews would be available and the details about the drawbacks of the OS would also be available.From this scenario, we can say that Scott belongs to the group of buyers called:

Accepted Answer

Scott is not an innovator who is willing to try new products as soon as they are released. He is also not a laggard who is resistant to change and skeptical of new products. Scott is waiting for more user reviews and information before making his purchase, indicating that he is an early majority type of buyer. The early majority tends to be cautious and waits for products to prove themselves before making a purchase.

Question 15

Which of the following groups of the consumer adoption cycle is characterized by buyers who enjoy taking risks, are regarded as knowledgeable, and are not price sensitive?

Accepted Answer

Innovators are the first group to adopt a new product, and they are characterized by their willingness to take risks, their knowledge about the product category, and their lack of price sensitivity.

Question 16

Which of the following terms can be best defined as buyers who want to be the first to have a new product or service?

Accepted Answer

Innovators are the first group of consumers who are eager to try new products or services and are willing to take risks to be the first to have them.

Question 17

Eric is enthusiastic about online video games.He has extensive knowledge of technical aspects of developing games and usually purchases licensed versions of most games as soon as they are launched.According to the diffusion of innovation model, to which of the following groups of buyers does Eric belong?

Accepted Answer

Innovators are the first group of buyers in the diffusion of innovation model who are willing to take risks and try out new technology or products. Eric's enthusiasm and extensive knowledge of technical aspects of developing games indicate that he falls under the innovators category.

Question 18

The term "diffusion of innovation" refers to the:

Accepted Answer

The term "diffusion of innovation" refers to the process by which the use of a new product or service spreads throughout a market group over time and over various categories of adopters. It is a sociological theory that seeks to explain how and why new ideas and innovations are spread and adopted within a society or a social group. It describes the rate at which new products or services are adopted by different segments of a market, from early adopters to laggards, and the factors that influence this process.

Question 19

Which of the following is NOT true about new products?

Accepted Answer

While entering a saturated market may be more challenging, it is not always advisable to avoid it. In some cases, companies can differentiate their products and offer unique value to customers even in a crowded market.

Question 20

Greg wants to upgrade his personal computer.He consults his friend Vernon because Vernon is highly knowledgeable in this field and always uses the latest technology.According to the diffusion of innovation model, to which of the following groups does Vernon belong?

Accepted Answer

Innovators are the first individuals to adopt new products or technologies and are typically highly knowledgeable about the subject matter. Vernon's high level of knowledge in the field of technology and his use of the latest technology suggest that he falls into the category of innovators.

Quiz 8: Developing New Products