Exam 12: Understanding Marketing Principles and Developing Products

What is secondary data?

Based on a product review in a magazine, Rob decided which product to buy. He is demonstrating the impact of psychological influences. cultural influences. past experience influences. social influences. personal influences.

What is the product mix?

How does organizational buying behaviour differ from consumer buying behaviour?

What is the purpose of the screening stage of the product development process? To identify potential production problems To identify the benefits which consumers want To actively seek out ideas for new products To eliminate all ideas that do not mesh with the firm's objectives, abilities, or expertise To compare costs and benefits of the proposed product

Sally spent the day in the local grocery store passing out free samples of a new potato chip. Sally gave every second customer the new chip with dip and every other customer the new chip without dip. What type of research was Sally conducting? Observation Primary and secondary data collection Experimentation Survey Focus groups

Experimentation tries to compare the responses of similar individuals in different circumstances.

Stereos, tires, business suits, and furniture are examples of ________ goods. convenience impulse coincidental shopping specialty

Discuss the effects that demographics can have on marketing strategies.

A newspaper, coffee, and an Egg McMuffin at McDonald's are all consumer convenience goods.

The new product that Bellson Corp. introduced last year is now experiencing rapidly increasing sales, and the product has begun to show a profit. But Bellson notices that two competitors have recently introduced a similar product. This is what happens in the ________ stage of a product's life cycle. growth maturity decline development introduction

When Procter & Gamble sent video crews into households in the U.K., Germany, and China to capture people's daily routines and product interaction, this was an example of both primary data gathering and the use of observation as a market research method.

What is the basic idea behind the product life cycle?

Snazzy Sodas is known for its variety of all-natural sodas as well as its efforts toward social responsibility. The company has decided to produce a new line of energy drinks, and while it does not have the resources to promote its product widely, it can make a sizeable impact with a carefully chosen market segment. The CEO favors marketing the product primarily to young males, but the VP of Operations recommends targeting female professionals. Which of the following, if true, would support the CEO's position? Snazzy decided that producing a line of energy drinks would be more profitable than attempting to penetrate international markets. Young males, as a group, consume more energy drinks than any other market segment. Energy drinks cost more per ounce than other popular beverages. Energy drink manufacturers have recently tried to associate their product with positive social causes. Different companies define "young" differently.

Typical variables used in segmenting markets by demographic characteristics include age, education, family life cycle, family size, income, nationality, race, religion, and sex.

Discuss the five common methods of segmenting consumer markets.

Coffee, potato chips, newspapers, bread, and AA batteries are examples of ________, while stereos and tires are examples of _____________. shopping goods; shopping services convenience goods; shopping goods specialty goods; specialty services convenience goods; specialty services shopping goods; shopping goods

Market segmentation must be done carefully, as a group of people may share an age category, income level, or some other segmentation variable, but their spending habits may be quite different.

Mirror Corp. has just completed the "screening" phase of the new product development process. What should they do next? Use input from the concept-testing phase to produce a preliminary version of the product. Conduct market research to solicit consumers' input about the benefits the proposed product must provide for consumers. Eliminate all product ideas that do not mesh with the firm's abilities, expertise, or objectives. Begin limited production of the product.

The value of a product, service, or idea to a consumer is based on the formula "benefits divided by costs."