Question 1

Many restaurants offer daily specials,appetizers,entrees,and desserts not listed on their standard menu.These daily specials primarily provide the new product benefit of
A) keeping up in a market where sales come mostly from new products.
B) satisfying the changing needs of current and new customers.
C) avoiding market saturation from products that have been on the market for a long time.
D) creating diversification and reducing risk.
E) reduction in cost of ingredients.

Accepted Answer

Daily specials allow restaurants to satisfy the changing needs of their customers by offering new and unique dishes that are not available on their regular menu. This helps to attract new customers and keep existing customers interested in returning.

Question 2

By adding new product lines beyond its core business of computer software,like the Surface Pro tablet and Xbox 360 game system,Microsoft primarily benefits by
A) keeping up in a market where sales come mostly from new products.
B) satisfying the changing needs of the technological research staff.
C) avoiding market saturation from products that have just been introduced to the market.
D) creating diversification and reducing risk.
E) spreading out production costs.

Accepted Answer

By diversifying its product lines, Microsoft can reduce its risk by not relying solely on one product. This can offset potential losses in one area with gains in another, creating a more stable and sustainable business model.

Question 3

Brian is trying to sell a new line of ultrasound imaging equipment.Unlike existing technology,these machines are compact,creating the potential for general practice physicians to have and use them in their offices.Brian is trying to identify innovators in his market,knowing these customers will most likely
A) spread positive word of mouth to other physicians.
B) buy one for each office in their practices.
C) reposition his products.
D) create demand among the late majority.
E) not need any service or support when using the product.

Accepted Answer

Innovators are early adopters who are often opinion leaders and influential in their network. If innovators are impressed with the new ultrasound imaging equipment, they are likely to spread positive word-of-mouth to other physicians, creating potential new customers for Brian.

Question 4

One of the potential benefits to a firm of introducing new-to-the-world products or services is
A) cost savings.
B) late majority marketing.
C) establishment of a completely new market.
D) the ability to avoid paying pioneers for new product development.
E) the ability to capitalize on existing consumer preferences.

Accepted Answer

Introducing new-to-the-world products or services has the potential to establish a completely new market, which can lead to significant competitive advantages and revenue growth for the firm. This is because the firm is able to offer something that has never been seen before, which can attract early adopters and create a loyal customer base. This advantage can be difficult for competitors to replicate, especially if the firm is able to secure intellectual property rights for their new product or service.

Question 5

__________ is the process by which ideas are transformed into new products and services that will help firms grow.
A) Beta testing
B) Concept testing
C) Innovation
D) Reverse engineering
E) Competition

Accepted Answer

Innovation refers to the process of turning creative or useful ideas into new products or services in order to spur growth for businesses.

Question 6

In many cases,pioneers lose their market lead and initial market share to imitators who
A) capitalize on the pioneers' weaknesses.
B) create similar products with reduced value to consumers.
C) utilize alpha-beta testing.
D) ignore patents and copyrights.
E) target late maturity consumers.

Accepted Answer

Imitators tend to capitalize on the weaknesses of pioneers and improve upon them, ultimately taking away market share.

Question 7

Which of the following was not a new-to-the-world product or service when it was introduced?
A) Wi-Fi
B) the Mercedes mini sport utility vehicle,a smaller version of its larger SUVs
C) Microsoft's Windows operating system
D) the MP3 player
E) flat-screen TVs

Accepted Answer

The Mercedes mini sport utility vehicle was not a new-to-the-world product; it was a smaller version of an existing product (SUV), whereas the other options were innovations or new technologies when first introduced.

Question 8

Which of the following is not a reason listed in your text for the high failure rate of new products?
A) failing to assess the market properly
B) neglecting to do appropriate product testing
C) targeting the wrong segment
D) overextending a firm's abilities
E) failing to introduce lower-priced alternatives

Accepted Answer

The text lists failing to assess the market properly, neglecting to do appropriate product testing, targeting the wrong segment, and overextending a firm's abilities as reasons for the high failure rate of new products. However, failing to introduce lower-priced alternatives is not listed as a reason for such a failure rate.

Question 9

Even if they succeed,new-to-the-world products are
A) generally not profitable.
B) not adopted by everyone at the same time.
C) not capable of creating new markets.
D) not subject to the law of first movers.
E) typically very short-lived.

Accepted Answer

New-to-the-world products are not adopted by everyone at the same time, meaning that their adoption and success is spread out over time. While the initial group of early adopters may be profitable, it may take time for the product to achieve widespread adoption and profitability. The other answer choices are incorrect: A) Some new-to-the-world products can be profitable, depending on their success in the market. C) New-to-the-world products have the potential to create new markets. D) New-to-the-world products are subject to the law of first movers, which suggests that the first company to enter a market with a new product has a competitive advantage. E) The lifespan of new-to-the-world products can vary; some may be short-lived while others may have a long-lasting impact on the market.

Question 10

Pioneer or breakthrough products
A) will likely result in late maturity buying.
B) can change consumer preferences.
C) incorporate reverse engineering outputs.
D) require the use of concept testing services.
E) must be geographically centered.

Accepted Answer

Breakthrough products have the potential to change consumer preferences and create new markets. This is because they offer something new and unique that has not been seen before, which can attract early adopters and innovative consumers. However, they may also require extensive marketing efforts to educate consumers about the product and its benefits.

Question 11

Whenever Donald considers upgrading his personal computer system,he consults with Jeremy,a knowledgeable friend who always has the newest technology.For Donald,Jeremy is a(n)__________ in the diffusion of innovation curve.
A) innovator
B) laggard
C) late majority adopter
D) early majority adopter
E) early adopters

Accepted Answer

Innovators are the first individuals to adopt new technology or innovation. In this scenario, Jeremy is the knowledgeable friend with the newest technology, suggesting that he is likely an innovator in the diffusion of innovation curve.

Question 12

Innovators are a critical group of new product adopters because they
A) are the major source of innovation.
B) act as reverse engineering consultants.
C) help with test marketing.
D) help the product gain market acceptance.
E) extend the product life cycle.

Accepted Answer

Innovators play a crucial role in the adoption process of new products by being among the first to adopt and use these products, thereby helping them gain acceptance in the market. Their early adoption encourages others to try the product, contributing to its overall market success.

Question 13

The process by which the use of a new product or service spreads throughout a market group is referred to as
A) new product introduction.
B) lead user dispersion.
C) diffusion of innovation.
D) the product life cycle.
E) product development diffusion.

Accepted Answer

The term "diffusion of innovation" refers to the process by which a new product or service is adopted and spreads throughout a market group. This process involves different stages of adoption by different groups of consumers, from early adopters to laggards, and can be influenced by various factors such as perceived benefits, relative advantage, compatibility, complexity, trialability, and observability. The diffusion of innovation theory was developed by Everett Rogers in the 1960s and has been widely used to explain and predict the adoption and diffusion patterns of various innovations in different fields.

Question 14

Successful first movers create a market or a product category.They often benefit from being readily recognizable to consumers and
A) not having to pay advertising expenses.
B) using prototypes to dominate the market.
C) not needing to do test marketing.
D) establishing an early market share lead.
E) motivating laggards to buy their products.

Accepted Answer

Successful first movers establish an early market share lead, which often leads to brand recognition and customer loyalty. This advantage allows them to maintain their position in the market while competitors struggle to catch up.

Question 15

Computer game companies constantly monitor computer game-related blogs keeping track of the latest hot products,because they know that their customers crave the "latest and greatest" games.They use this information to create new products that primarily provide the benefit of
A) keeping up in a market where sales come mostly from new products.
B) satisfying the changing needs of former customers.
C) avoiding market penetration from products that have been on the market for a long time.
D) creating diversification and reducing risk.
E) taking advantage of a long product cycle.

Accepted Answer

Computer game companies need to keep up with the latest hot products to stay competitive in a market where sales come mostly from new products. By monitoring blogs and creating new products, they can stay relevant and maintain their customer base.

Question 16

The diffusion of innovation theory focuses on
A) the geographic boundaries of innovation.
B) the relationship between pioneer brands and imitators.
C) the psychological traits of innovators.
D) the rate at which consumers are likely to adopt a new product or service.
E) the way a product moves through the product life cycle.

Accepted Answer

The diffusion of innovation theory focuses on the rate at which consumers are likely to adopt a new product or service.

Question 17

Which of the following is not one of the five groups in the diffusion of innovation curve?
A) Innovators
B) Non-adopters
C) Late majority
D) Early majority
E) Early adopters

Accepted Answer

The five groups in the diffusion of innovation curve are innovators, early adopters, early majority, late majority, and laggards. Non-adopters are not considered as a separate group in the curve.

Question 18

Eric is a sales rep for an established building materials manufacturer.Business is good,but he is concerned that the company has spent little on new product development and has not created a new product in over five years.Without new products,Eric can market his current products only to his current customers or
A) diversify.
B) intensify his prototyping.
C) expand his early adopter market segment.
D) market the same products to similar customers.
E) focus on concept testing.

Accepted Answer

Eric can market the same products to similar customers, which means finding new customers who have similar needs and interests as his current customers but are not currently being served by his company. This approach doesn't require new product development but rather focuses on expanding the customer base for existing products.

Question 19

In the diffusion of innovation process,innovators enjoy taking risks and are regarded as highly knowledgeable.Marketers want to identify innovators because
A) they prefer products from established market leaders.
B) other consumers defer to their judgment,creating the opportunity for word-of-mouth referrals.
C) they are especially price conscious.
D) they are easily influenced by reminder advertising.
E) they encourage competitors to enter the market.

Accepted Answer

Innovators are regarded as highly knowledgeable and are often opinion leaders who have the potential to influence other consumers. By identifying innovators, marketers can target them with marketing messages and encourage them to spread positive word-of-mouth referrals to their social networks. This can lead to wider adoption of the product by other consumers.

Question 20

Which of the following is not one of the benefits to a firm of new product development?
A) reducing the costs of production
B) satisfying the changing needs of current and new customers
C) avoiding market saturation from products that have been on the market for a long time
D) creating diversification and reducing risk
E) keeping up in a market with short product life cycles where sales come mostly from new products

Accepted Answer

New product development may actually increase production costs in the short term due to research and development efforts. However, the other options listed are all valid benefits of new product development.

Quiz 12: Developing New Products

Many restaurants offer daily specials,appetizers,entrees,and desserts not listed on their standard menu.These daily specials primarily provide the new product benefit of

By adding new product lines beyond its core business of computer software,like the Surface Pro tablet and Xbox 360 game system,Microsoft primarily benefits by

One of the potential benefits to a firm of introducing new-to-the-world products or services is

__________ is the process by which ideas are transformed into new products and services that will help firms grow.

In many cases,pioneers lose their market lead and initial market share to imitators who

Which of the following was not a new-to-the-world product or service when it was introduced?

Which of the following is not a reason listed in your text for the high failure rate of new products?

Even if they succeed,new-to-the-world products are

Pioneer or breakthrough products

Whenever Donald considers upgrading his personal computer system,he consults with Jeremy,a knowledgeable friend who always has the newest technology.For Donald,Jeremy is a(n) __________ in the diffusion of innovation curve.

Innovators are a critical group of new product adopters because they

The process by which the use of a new product or service spreads throughout a market group is referred to as

Successful first movers create a market or a product category.They often benefit from being readily recognizable to consumers and

Computer game companies constantly monitor computer game-related blogs keeping track of the latest hot products,because they know that their customers crave the "latest and greatest" games.They use this information to create new products that primarily provide the benefit of

The diffusion of innovation theory focuses on

Which of the following is not one of the five groups in the diffusion of innovation curve?

In the diffusion of innovation process,innovators enjoy taking risks and are regarded as highly knowledgeable.Marketers want to identify innovators because

Which of the following is not one of the benefits to a firm of new product development?