Exam 11: Developing and Managing Goods and Services

Quality modification of an existing product aims at changing the product's safety, convenience, or versatility.

List and discuss the seven phases of the new-product development process.

Line extensions are more common than new products because line extensions:

The concept testing phase of the new-product development process presents a small sample of potential buyers with a trial version of a new product to determine their initial reactions.

When a movie theater entices customers to view movies during the daytime by offering tickets at a reduced price, it is trying to resolve the services marketing challenge of:

The sum of a product's physical characteristics is called product quality.

If the quality of different service providers is likely to vary, customers seldom rely on the price-quality association.

The phase-out approach to product deletion exploits any strength left in the product.

New products are classified solely as innovations that have never been sold by any organization.

Luis Mayo is an accountant at Ralston Purina. However, he is currently working with a group of experts to determine the feasibility of a new brand of hot breakfast cereal. Luis and the experts are also developing a marketing strategy for the product. After the product is launched, Luis will resume working in the accounting department. His present position can be described as a:

Services can involve both human and mechanical efforts.

Scenario 11.2 Use the scenario to answer the questions. Jonathan Moore, President of Polar Manufacturing Company, has just reviewed the performance reports for the previous year and observes that there are certain areas in which the company needs to improve. He specifically feels that Polar's product mix can be managed in a more effective way. Jonathan summons a meeting of all the managers responsible for each of the product lines that Polar currently manufactures. The group reaches a consensus that the complete industrial product line of ice chests needs to be eliminated. It contemplates to do so by letting the product decline without making any changes in the marketing strategy or product. The group also decides to delete Polar's line of personal thermal underwear within a week, owing to its unprofitability. While discussing these strategies, the group also uncovers several customer segments at which new products could be targeted. The managers decide to assemble a group of people from all functional areas of the company and confer them responsibilities for all aspects of the new-product development. -Refer to Scenario 11.2. The decision to delete the industrial product line of ice chests is an example of deleting a product through a(n) , while the decision to drop the thermal underwear line is an example of a(n) .

The run-out approach to product deletion is used for technologically obsolete products.

Troy is a service provider for a low-contact service. Which of the following services is most likely provided by Troy?

Layaway plans and customer trainings are examples of product support services.

Services are highly perishable and cannot be inventoried for future use.

Designing a product that customers perceive as different from competing products is an example of product differentiation.

People-based services are often prone to fluctuations in quality from one time period to the next.

Which of the following is not a "customer contact" characteristic in services marketing?

Bauman Flooring found a supplier of very inexpensive fibers that could be used to produce low-grade carpeting at a very low cost. Because Bauman had been facing stiff competition in the medium-grade carpet industry, it started using the new material in all of its carpeting and also reduced its prices. This is an example of a(n):