Exam 9: Product Management and New-Product Development

Use this information for question that refer to the Wire Products Inc. (WPI) case. Rob Rose sat back to review the portfolio of products his company, Wire Products Inc. (WPI), has in its product line. The company specializes in making various products for consumer and industrial uses from hard laminated wire-coated with special paints. 1) WPI's "Wire Closet" products have been on the market for 10 years. Consumers install the wire shelves and closet rods themselves. The market leader, Closetmaid, has been selling similar products for more than 20 years, but so far the sales volume and profits for the market continue to grow. Recently, several new competitors have come into the market. 2) Three months ago, WPI entered the lawn and garden market with folding fences made with laminated wire and branded as "Wire Fold-Fence." Previously, WPI had never made fences or been a player in the lawn and garden market-although other companies have been making products in this market for years. However, Rob Rose has discovered that recent sales of wire garden fencing have leveled off and profits are declining overall. Still, WPI thinks it has some cost advantages and can grow its own sales and profits in this market. 3) WPI has just developed "Oil Wire," a new concept for the environmental cleanup market. Oil Wire is coated with a special material that cleans up oil spills. There has never been a product like this and WPI wants to quickly get the word out about its benefits. The product is now being rolled out in selective markets. 4) Another business product is "Wire Locker" used for secure storage by gymnasiums or companies. This style of locker has now gone out of fashion and most customers are finding better materials to use for lockers. Aggressive selling has helped Wire Locker's sales stay flat, but the total market for wire style lockers is only half of what it was 10 years ago. 5) WPI's "Wire Window" product is used as a security product to protect glass windows. It sells to homeowners and retailers looking for additional safety. WPI's sales of this product have dropped in recent years because competitors have introduced maintenance-free products. However, the overall market for this type of product continues to show good growth. 6) WPI is running concept tests of a new wire car-top carrier called "Wire Car Top." There are other car-top carrier products on the market, but WPI plans to include options in its carrier that will make it easier to load bikes, skis, and suitcases. "Wire Car Top" is also very easy to put on and take off of the car because of its light weight and ease-of-use features. The concept tests are helping WPI analysts develop rough estimates of costs, sales, and profits. 7) Another new product idea, tentatively called "Wire Tent," is being considered. It would use laminated wires to create a portable tent frame. This product is currently being evaluated to determine its fit with the company's objectives and external market trends. Rob is thinking about the product life cycle, where each product fits, and what he should be doing as part of his marketing plan for each of these products. According to the definition in your text, which of WPI's products can be called a new product?

In the 1990s, DVDs replaced audiocassettes and floppy disks as the storage media of choice for music and computers. At which stage of the product life cycle is the DVD today?

The cost of replacing defective parts is the biggest cost of poor quality.

Experts estimate that 80-95 percent of all new consumer packaged goods brands fail.

In general, product life cycles appear to be getting longer in recent years.

A marketing manager might use the total quality management approach to:

New-product development usually fits into the old routines of a firm, so it is not necessary for top management to support new-product development in any special way.

A high percentage of new-product ideas survive to the commercialization step in the new-product development process.

Total quality management can be used to improve any implementation effort.

_____ means giving employees the authority to correct a problem without first checking with management.

Regarding the idea generation stage of the new-product development process, which of the following is true?

During the sales decline stage of the product life cycle, no firm can earn a profit.

A firm may introduce or withdraw a product during any stage of the product life cycle.

How quickly a new product will be accepted by customers and how quickly competitors will follow with their own version of a product are important factors when planning the best strategy for a new product.

It is possible for a firm with a mature product in the U.S. to experience new growth with the same product in international markets.

When looking for new product ideas, which of the following would be good sources?

Pfizer Corp. is introducing a truly new product idea. Pfizer is spending a lot of money to inform potential customers and intermediaries about the availability and advantages of the new product. Although sales are rising slowly, Pfizer doesn't expect the product to become profitable for at least another year. Pfizer's new product is in which stage of the product life cycle?

Product liability means the legal obligation of sellers to pay damages to individuals who are injured by defective or unsafe products.

The strategies for all stages of the product life cycle should be growth strategies.

All of the following products are in the market maturity stage of the product life cycle except: