Question 1

Sara Lee, the maker of Ball Park hot dogs, has decided to introduce its new Ball Park hot dog buns in a limited market consisting of only four cities and to closely monitor the reactions of potential customers to the product and marketing program. What is Sara Lee going to use?

Accepted Answer

Sara Lee is going to use test marketing, which involves introducing a new product in a limited market and monitoring the reactions of potential customers to the product and marketing program. This allows the company to gather feedback and make any necessary changes before launching the product on a larger scale. A is incorrect because market profitability analysis is not relevant in this situation, as the focus is on testing a new product rather than analyzing profitability. B is incorrect because market development analysis involves identifying new markets for existing products, which is not applicable in this scenario. C is incorrect because concept marketing involves testing new marketing concepts, rather than new products, and is not what Sara Lee is doing in this case.

Question 2

In which stage of new-product development would the technical feasibility of manufacturing the new product as a prototype be examined?

Accepted Answer

The development stage is when the technical feasibility of manufacturing the new product as a prototype would be examined. This is the stage where the product design is refined, a prototype is developed and tested, and the production process is planned.

Question 3

When selecting a test market city, what should a researcher look for?

Accepted Answer

It is important to select a test market city that closely mirrors the overall market for the product in terms of demographics and purchasing habits. This will provide the most accurate results for how the product will perform in the larger market. Media spill over and the size of the city may also be important factors, but they should not be the primary consideration. The size of the upper class is not a relevant factor in selecting a test market city.

Question 4

After Mattel evaluated many new products to add to its Barbie product line and before any prototype was created, the toy manufacturer instructed a committee to select three of the ideas to present to a group of consumers. The consumer group was asked to evaluate the three product ideas in terms of their marketability. What is this stage of new-product development called?

Accepted Answer

This stage of new-product development is called concept testing, where potential customers are asked to evaluate product ideas in terms of marketability before any prototypes are created.

Question 5

The same manufacturer produces Hanes, Playtex, and Bali clothing for women. This manufacturer assembled a group of nine regular customers and asked them to discuss what they like and do not like about its current product line for full-figured women and to suggest new-product ideas, such as jewellery, wide shoes, and belts. Which research technique did the manufacturer use?

Accepted Answer

The manufacturer used a focus group technique where a group of regular customers were assembled to discuss the current product line, suggest new product ideas and provide feedback.

Question 6

Top managers at a company that publishes regional magazines considered making maps, but then decided maps were not within the company's corporate mission. Which stage of the new-product development process did its new-product development process reach?

Accepted Answer

The given scenario describes the idea screening stage of the new-product development process. The company had already generated the idea of making maps, but they screened and evaluated it against their corporate mission and decided not to pursue it. Therefore, the correct answer is option B, i.e., idea screening.

Question 7

Rhonda Ausman and her team at a publishing company came up with lots of new ideas around the new cover for a marketing textbook. After these ideas were generated, what is the next thing that Rhonda and her team must do?

Accepted Answer

After generating lots of new ideas, the next step is idea screening, which involves evaluating and selecting the most promising ideas for further development. This is done to ensure that only the most viable ideas move forward in the development process, saving time and resources.

Question 8

The maker of Lysol disinfectant tested consumers' reactions to its Lysol Sanitizing Wipes by getting consumers to look through a newspaper with grocery store ads, make out a grocery list, and then "shop" in a mock store filled with real products, including the new cleaning product. What is this an example of?

Accepted Answer

This is an example of a simulated (laboratory) market test, where consumers are placed in a mock shopping environment and observed while interacting with the product.

Question 9

Now that the design of a new smart-fridge has been finalized, Igloo must now estimate preliminary demand, cost, sales, and profitability. What stage of the new product development process is this?

Accepted Answer

This stage is called business analysis, where the company analyzes the potential profitability, costs, sales, and demand of the product before deciding on whether to launch it or not.

Question 10

Many years ago, Athens, Greece, was viewed as a necessary part of any tour of Europe. Then the city developed an image of a smoggy city choked with traffic. The Greek government realized package tour operators were unimpressed by the proposal to paint the facades of the buildings in Athens. During which stage of its attempt to reposition Athens as a culture-filled destination for conventions would this have occurred?

Accepted Answer

The stage of screening and concept testing involves evaluating ideas to identify viable options. The Greek government's proposal to paint building facades and its reception by tour operators fits into this stage, where ideas are tested for feasibility and appeal.

Question 11

Before the introduction of a timekeeping spreadsheet for salespeople, a sample of salespeople were able to try a prototype. What is this stage of new-product development called?

Accepted Answer

This stage of new-product development is called concept testing, which involves getting customer feedback on a new product idea or prototype before investing resources into its development and launch.

Question 12

A European dairy, which is famous for its rich ice creams, has introduced basil-, tomato-, and oregano-flavoured ice creams. In the process of developing these new flavours, the dairy surveyed world-famous chefs to determine which non-traditional flavours had the greatest level of marketability. This survey would have happened during which stage of the product development process?

Accepted Answer

The answer of A European dairy, which is famous for...

Question 13

Middleton has developed the Flybar 1200, an extreme pogo stick that propels users more than 1.5 metres into the air. A group was assigned the task of estimating preliminary demand for the product, costs (including issues with liability), sales, and future profitability. During which stage of its new-product development process would this have occurred?

Accepted Answer

During the business analysis stage, a company analyzes the potential demand, costs, and profitability of a new product. This includes evaluating issues such as liability and conducting market research to determine potential sales. Therefore, this is the most likely stage in which the group would be tasked with estimating demand, costs, sales, and future profitability for the Flybar 1200. Concept testing involves gathering feedback on a product idea from potential customers, screening involves evaluating the feasibility of a product idea, and test marketing involves introducing a new product to a limited market to assess its performance before a full launch. None of these stages would be as relevant for the task assigned to the group.

Question 14

What is the purpose of the screening and concept testing stage of the new-product development process?

Accepted Answer

The purpose of the screening and concept testing stage is to eliminate undesirable ideas and predict consumer acceptance. This helps to ensure that resources are not wasted on developing a product that will not be successful in the market.

Question 15

At what stage of the new-product development process are most new-product ideas rejected?

Accepted Answer

Most new-product ideas are rejected in the idea screening stage as it involves evaluating and screening the ideas to determine whether they fit with the company's objectives and whether they are feasible in terms of resources, cost, and market potential. This stage eliminates many ideas that do not meet the criteria for further development.

Question 16

The maker of Skittles candy tested and prepared hundreds of batches of candy for taste-testers, who were employees of the company. The taste-testers were instructed to identify the best formula for mint-flavoured Skittles. What type of test was used?

Accepted Answer

The type of test used was a laboratory test. This involved preparing different batches of candy with variations in ingredients and flavours and having the taste-testers (who were employees of the company) evaluate and identify the best formula for mint-flavoured Skittles. This process was conducted in a controlled environment, which is characteristic of a laboratory test.

Question 17

Noam Finkelstein has recently introduced a limited run of his new book in a suburb of Toronto to determine the reactions of potential readers. What is this also known as?

Accepted Answer

This is an example of test marketing, which involves introducing a product or service to a limited market to gauge reaction before launching it on a larger scale.

Question 18

An electronics store is currently seeing how Edmontonians react to a retail concept called Studio D, which is targeted to women. Edmonton is the only city in which Studio D stores were introduced. The store will monitor the reactions of customers to the store. What is the store using to determine consumer reaction to a new retailing concept?

Accepted Answer

The store is using test marketing to determine customer reaction to the new retail concept. Test marketing involves introducing a product or service in a specific geographic location and monitoring customer reactions and sales before a wider release. In this case, the Store is introducing Studio D only in Edmonton to see how the target market, women in this case, responds to the concept.

Question 19

Which tests evaluate new-product ideas usually before any prototype has been created?

Accepted Answer

Concept tests are used to evaluate new-product ideas before any prototype has been created. This type of test helps companies to determine if there is a market for the product and if it will be successful before committing resources to developing the product. Simulated market tests and market tests are typically done after a prototype has been created, and user tests are done after the product has been launched.

Question 20

What is required for the development stage of the new-product development process to work best?

Accepted Answer

Simultaneous product development is essential for the development stage of the new-product development process to work best. This means that different aspects of the product, such as design, engineering, and marketing, should be developed concurrently rather than sequentially, which can lead to a more efficient and effective process. Laboratory testing and test marketing may occur later in the process to refine and validate the product, but they are not necessarily required for the development stage. The new-product paradigm is a theoretical framework that describes how companies can create successful new products, but it is not a specific requirement for the development stage.

Quiz 11: Developing and Managing Products