Exam 11: Developing and Managing Products

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?

What is the final stage in the new-product development process? What tasks are set in motion during this stage?

Scenario 11-2 After years of development and testing, Jabra Corporation unveiled the Jabra 1000 earbud phone. The entire device fits in your ear. It resembles those tiny in-ear speakers that let you listen to an iPod in private-except that Jabra's unit is a transmitter as well. It picks up your voice by amplifying sound vibrations in your bones. Therefore, there's no microphone boom to jut out in front of your face. Because the bone vibrations must be amplified, a special chip in the part of the system that connects to the base of your phone uses noise-cancellation technology to screen out background sounds. This anti-noise chip generates a mirror image of outside noises, and the colliding sound waves erase each other. The main electronics package-about the size of a deck of cards-also monitors the quality of the phone line and automatically raises the volume of voice transmissions when the connection is weak. This tech-talk isn't cheap: the earbud phone lists for $329. -Refer to the scenario. The Jabra 1000 is superior to existing hands-free telephones, especially with its small size and single part. However, consumers may think its advantages over current hands-free phones may not be worth the additional cost. Thus, what might affect adoption?

B.F. Goodrich has been manufacturing and marketing automotive tires for over 100 years. It spends much of its marketing budget on short-term promotions aimed at stealing market share from Goodyear, Dunlap, and other tire manufacturers. From this information, in which stage of their product life cycle are tires?

The development of garlic butter-flavoured crescent rolls by Pillsbury would not be considered a new product since the company was already making crescent rolls. It would simply be called a line extension.

What can the marketers of consumer products expect to find when they study and apply the product life cycle theory to their products?

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?

What is the final stage in the new-product development process?

Scenario 11-1 In 2006, Coca-Cola North American debuted Gold Peak iced tea. According to Ray Crockett, spokesperson for Coke, "In looking at the ready-to-drink tea market, we found that the one place that nobody seemed to be playing was in the category of classic iced teas like mother used to make. Gold Peak is a quality product that brings back that classic taste." -Refer to the scenario. The tea has high marketing costs as well as high production costs. Promotions for the product are aimed at informing consumers that this premium product tastes like it's home-brewed. In which stage of the product life cycle is Gold Peak iced tea?

Which of the following is NOT a characteristic that would slow the rate of adoption of new products?

It is considered inefficient to use concept tests during the idea screening stage of the new-product development process.

Samsung has test marketed its latest TV and is now ready to begin mass manufacture and distribution. What stage of the new product development process is Samsung in?

For years, the Lacoste brand of clothing has targeted 40-something male consumers. Today, it targets both male and female fashion-conscious consumers in their 20s with everything from moon boots to shearling coats. Which strategy is being implemented?

When Middleton developed the Flybar 1200, an extreme pogo stick that propels users more than 1.5 metres feet into the air, it performed screening, development, and testing prior to commercialization of the product.

You are a product manager for a manufacturer of trampolines. You have determined that the trampoline is in the maturity stage of the product life cycle. What should you do to keep your product from entering the decline stage?

What are patio furniture, lighting fixtures, microwave ovens, canned corn, and athletic shoes all examples of?

Campbell has developed a line of premium soups called Campbell's Select Gold Label to go with its red-label brands. This is an example of a new product.

The marketing manager for Iams Pet Food wants to base the marketing strategy she implements for the company's products on the product life cycle stages. What should she do?

Scenario 11-3 In the early 1900s, a new product was developed-the phonograph record. It allowed people to listen to and appreciate recorded music in the privacy of their homes. At first, consumers were reluctant because the idea was so novel and difficult to comprehend. During the 1930s, the pioneers in the record industry were experiencing strong sales and profits. As a result, other firms began to enter the market and competition intensified. At this point, there were hundreds of record producers and manufacturers. During the 1940s and 1950s, sales continued to increase, but at a much slower rate. The market stayed at approximately the same level until the late 1960s when a new technology arrived in the form of the eight-track tape. The record market began a slow decrease in sales. By the 1970s, another new technology, cassette tapes, replaced the eight-track tape. During the 1970s and 1980s, record production continued to decrease. In the late 1980s, sales dropped rapidly as yet another new technology arrived, the compact disc. Digital downloading of songs from online stores like iTunes has become the norm. Today, most stores no longer carry records, which have become a niche product. -Refer to the scenario. Record companies spent a lot of money on product information advertising in the 1920s to educate the public about the new technology. This is a characteristic of which stage of the product life cycle?

A firm's new-product strategy links the new-product development process with the objectives of the marketing departments, the business unit, and the corporation.