Question 1

__________ 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 is the process of transforming ideas into new products or services that can lead to growth for firms. Beta testing refers to testing a product in the market before its official launch, concept testing involves testing a concept or idea with target consumers, reverse engineering involves breaking down a product to understand how it was made, and competition refers to the rivalry between firms in a particular market.

Question 2

All of the following groups are included in the diffusion of innovation curve except
A) innovators.
B) non-adopters.
C) late majority.
D) early majority.
E) early adopters.

Accepted Answer

The diffusion of innovation curve includes innovators, early adopters, early majority, late majority, and laggards, but not non-adopters. Non-adopters are individuals or groups who choose not to adopt or use an innovation, but they are not considered as part of the diffusion process as they do not actively participate in spreading or adopting the innovation.

Question 3

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 can change consumer preferences as they introduce new and innovative features or technologies that were not previously available in the market. This can lead to a shift in consumer behavior towards the new product, affecting the demand and purchase decisions of consumers.

Question 4

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

The imitators often study and analyze the weaknesses and shortcomings of the pioneers' product or service and use this information to develop a better or improved version, thus capturing the attention and loyalty of the consumers.

Question 5

All of the following are benefits of new product development to a firm
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

The answer of All of the following are benefits of...

Question 6

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 cater to the changing needs of current and new customers by providing variety and introducing new dishes. It helps restaurants keep customers interested and coming back for more.

Question 7

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 typically well-respected and influential, and their opinions and recommendations can carry significant weight with other consumers. Identifying innovators can therefore lead to valuable word-of-mouth referrals and help to build buzz around a new product or innovation.

Question 8

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 know that their customers crave the "latest and greatest" games, and sales in this industry come mostly from new products. Therefore, they monitor computer game-related blogs to keep track of the latest hot products and use this information to create new products that will keep up in a market where sales come mostly from new products.

Question 9

Whenever Andrew considers upgrading his personal computer system,he consults with Jeremy,a knowledgeable friend who always has the newest technology.For Andrew,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 one who has the newest technology and is consulted by Andrew to upgrade his personal computer system, making Jeremy an innovator in the diffusion of innovation curve.

Question 10

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 11

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

Even if new-to-the-world products succeed, they are not adopted by everyone at the same time. This is because early adopters are typically the first to try new products, and it takes time for the majority of the market to adopt them. While new products can create new markets, they may not always be profitable and the law of first movers may not apply. While some new products may be short-lived, this is not always the case.

Question 12

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 willing to take risks and try new products before others. They are also typically opinion leaders who can influence the purchasing decisions of others. By identifying innovators in his market, Brian can target these customers who are likely to spread positive word of mouth to other physicians, which can lead to increased sales and adoption of his new line of ultrasound imaging equipment.

Question 13

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 creating diversification, Microsoft reduces the risk of relying solely on its core business of computer software. Adding new product lines also allows the company to reach new markets and potentially increase profits.

Question 14

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 a new-to-the-world product or service means that a firm is establishing a completely new market, which can be a significant advantage in terms of creating demand and capturing market share before competitors enter the market.

Question 15

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 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 is focused on understanding the rate at which consumers are likely to adopt a new product or service. It explores the different stages of adoption, from innovators to early adopters, early majority, late majority, and laggards. This theory helps marketers develop strategies to accelerate the adoption process and maximize the benefits of introducing a new product or service.

Question 17

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 process described is referred to as the diffusion of innovation. This is the process by which a new product or service is adopted and spreads throughout a market group over time. It involves the different stages of awareness, interest, evaluation, trial, and adoption by consumers.

Question 18

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 gives them an advantage over later entrants. Being the first to enter a market allows them to capture the initial customers and establish brand recognition. This gives them a head start in building a loyal customer base and creating barriers to entry for competitors.

Question 19

All of the following are reasons for the high failure rate of new products except
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

Failing to introduce lower-priced alternatives is not a commonly cited reason for product failure. The other options—failing to assess the market properly, neglecting appropriate product testing, targeting the wrong segment, and overextending a firm's abilities—are often identified as contributing factors to high failure rates.

Question 20

All of the following were considered a new-to-the-world product or service when introduced except
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 or service when introduced; it was a variation of existing SUVs, making it an example of a product line extension rather than a completely new innovation. Wi-Fi, Microsoft's Windows operating system, the MP3 player, and flat-screen TVs were all innovations that introduced new categories or fundamentally changed how people interacted with technology and media.

Quiz 12: Developing New Products

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

All of the following groups are included in the diffusion of innovation curve except

Pioneer or breakthrough products

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

All of the following are benefits of new product development to a firm

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

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

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

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

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

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

Innovators are a critical group of new product adopters because they

The diffusion of innovation theory focuses on

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

All of the following are reasons for the high failure rate of new products except

All of the following were considered a new-to-the-world product or service when introduced except