Deck 10: Developing and Managing Products

Question 1

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.

Answer 1

True

Question 2

A recording company that is introducing audio versions of early television comedies has decided to offer clips of the recordings at its Web site.This plan will increase the trialability of the new product.

Answer 2

True

Question 3

Seven employees at the Ferguson Fabricators are trying to come up with ideas for new product development.The employees are all in a room together,shouting out potential ideas.The ideas are written down and evaluated as they are generated.This is an example of brainstorming.

Answer 3

False

Question 4

The product life cycle is so named because it is similar to the premise underlying the concept of any life cycle.The unit of interest is born,it grows for some time,and it reaches some level of maturity and stability before dying.

Question 5

Test marketing may result in a serious problem if a firm's competitors find out about the new product before it has been fully introduced.

Question 6

While developing new products is far from an exact science,most firms do follow a formal new-product development process.

Question 7

Reynolds,the manufacturer of aluminum foil,developed plastic wrap in an array of different festive colors.This is an example of a new product.

Question 8

The city a firm chooses as its test market should reflect the demographic and other characteristics of the whole nation only if that is an accurate representation of the producer's intended market for the product.

Question 9

Basically,all that happens in the development stage of the new-product process is that the first prototype of the product gets developed.

Question 10

The two techniques that are considered most useful for generating new-product ideas are customer-generation and competitive imitation.

Question 11

The development of a strawberry-flavored cake mix by Duncan Hines would not be considered a new product since the company was already making cake mixes.It would simply be called a line extension.

Question 12

The most important factor in successful new-product introductions is a good match between product characteristics and customer desires.

Question 13

A test market is one example of a laboratory test where consumers are encouraged to try a new product and provide feedback to the manufacturer.

Question 14

Andersen Electronics is currently engrossed in its first estimations of costs and revenues for a new amusement park video skill game.This firm is engaged in a new-product business analysis.

Question 15

The Sumatra Coffee Company has two new products.One is a simple hand-cranked coffee grinder.The other is a combination grinder and brewer that also can be used to dispense hot milk.Of these two,the hand-cranked grinder will probably be diffused more quickly because it is less complex.

Question 16

The USPS has developed a personalized photo stamp that customers can create and use to mail letters.The USPS has already performed screening,development,and testing.Assuming the results coincide with profit and cost expectations,the Postal Service's most likely next step is commercialization.

Question 17

For a firm that adheres to the marketing concept,the logical place to start generating new-product ideas is with the customers of the firm.

Question 18

Diffusion is the process by which the adoption of an innovation spreads.

Question 19

Increasing globalization of markets and of competition provides a reason for multinational firms to consider new-product development from a worldwide perspective.

Question 20

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

Question 21

The maker of Peter Pan peanut butter has developed a honey-flavored peanut butter spread to add to its peanut product line.Is this a new product?

A) No,peanut butter cannot be considered an innovation.
B) Yes,additions to the product line are new products.
C) No,it is only a product addition.
D) Yes,this is a discontinuous innovation.
E) No,this is not a product improvement.

Question 22

The product life cycle concept encourages marketing managers to act reactively.

Question 23

Increasing competition,aggressive brand advertising,and healthy profits are all characteristics found in the introductory stage of the product life cycle.

Question 24

When Banquet made its chicken patties 20 percent larger to provide greater value to the consumer,it was not trying to reach a new target market.Banquet has created a(n):

A) improved product
B) addition to an existing product line
C) discontinuous innovation
D) repositioned product
E) new product line

Question 25

_____ occurs when an existing product is targeting it toward new market segments.It is another type of new product development because the product is new to that segment.

A) Brainstorming
B) Diffusing
C) Repositioning
D) Screening
E) Reciprocity

Question 26

Profits typically reach their peak during the growth stage of the product life cycle.

Question 27

A European dairy,which is famous for its rich ice creams,has introduced basil,tomato,fennel,and oregano flavored ice creams.This would be an example of a(n):

A) repositioning strategy
B) new product line
C) addition to an existing product line
D) discontinuous innovation
E) revision to existing products

Question 28

Steve Legado designs software for the medical profession.He thinks that the market for his product is reaching saturation.This would imply that Legado's product is in the growth stage of its product life cycle.

Question 29

Canesta has developed a virtual keyboard out of light to be used with cell phones and personal digit assistants.The product beams an image of a keyboard on desk allowing the user to type on the image.The words are picked up by the user's digital device.It is the pioneering firm in the field and is troubled by economic concerns.Production and promotional costs are high,and profits are negative.Such poor business performance is typical of firms in the introductory stage of the product life cycle.

Question 30

Walker Zanger is about to introduce a new type of ceramic tile that is scratch-resistant and unbreakable.As with other products of this type,Walker Zanger can expect sales of this new type of flooring to follow a bell-shaped curve over the next ten to fifteen years as it follows the product life cycle.

Question 31

Canesta has developed a virtual keyboard out of light to be used with cell phones and personal digit assistants.The product beams an image of a keyboard on a desk,allowing the user to type on the image.The words are picked up by the user's digital device.This virtual keyboard,which is radically different from anything currently on the market would be classified as a:

A) discontinuous innovation
B) slow-diffusing product
C) episodic innovation
D) venture product
E) sporadic innovation

Question 32

When Sherwin Williams paint manufacturer began selling Martha Stewart designed paints,it could be classified as a(n):

A) repositioning strategy
B) new product line
C) addition to an existing product line
D) discontinuous innovation
E) revision to existing products

Question 33

A(n)_____ links the new-product development process with the objectives of the marketing department,business unit,and corporation.

A) product-review committee
B) concept test
C) episodic innovation
D) new-product strategy
E) product strategy bridge

Question 34

Until the mid-1990s,MGP Ingredients,Inc.,sold ethanol and animal feed.A steep drop in its sales led the company to focus on developing the first low-carb proteins and starches.These low-carb proteins and starches would be an example of a(n):

A) repositioning strategy
B) new product line
C) addition to an existing product line
D) discontinuous innovation
E) revision to existing products

Question 35

Stouffer's added 25 percent more meat to its Lean Cuisine Skillet Sensations meal-in-a-bag.The addition of more meat made the product acceptable to men as well as women and expanded its target market.The meatier Lean Cuisine Skillet Sensations is an example of a(n):

A) new-to-the-world product
B) new product line
C) repositioned product
D) addition to a current product line
E) discontinuous innovation

Question 36

Many products may experience short-term fluctuations in sales,but a long-term drop in sales probably signifies that a product is in the decline stage of the product life cycle.

Question 37

Marketers consider all of the following examples of new products EXCEPT:

A) a 2006 model year GE dishwasher with the same style,parts,and color as the 2005 model
B) the addition of an investment service to a company that once specialized in insurance
C) a new flavor of Jell-O gelatin
D) a new low-fat formulation for Campbell's soup
E) a bloodless means for diabetics to monitor their sugar levels

Question 38

New-to-the-world products,where the product category itself is new,are also called:

A) discontinuous innovations
B) moderate innovations
C) slow-diffusing products
D) venture products
E) creative offerings

Question 39

Companies that are most likely to succeed in the development and introduction of new products typically:

A) establish an environment conducive to achieving new-product objectives
B) make the long-term commitment needed to support innovation and new-product development
C) capitalize on experience to achieve and maintain competitive advantage
D) use a company-specific approach that is driven by corporate objectives and strategies with a we-defined new-product strategy at its core
E) do all of the above

Question 40

When the manufacturer of Pine-Sol cleaning liquid introduced an orange-scented cleaner,the product was:

A) not considered new,because the product was not discontinuous
B) not accepted well in the market until a personal selling campaign was launched
C) easily sold to many foreign countries using the same,popular Tic Tac brand name
D) an example of inventing a product and then trying to create a need
E) a new product because it was an improvement or revision of an existing product

Question 41

_____ goes one step further than applied research by converting new technology applications into marketable products.

A) Basic research
B) Product modification
C) Marketing development
D) Product development
E) Correlation analysis

Question 42

Christian Kniski has developed a new technology which uses miniature computerization to analyze DNA specimens.His next step after developing the product should be to work to find an application for this new technology through:

A) applied research
B) product development
C) basic research
D) screening
E) concept testing

Question 43

_____ is the first filter in the new-product development process.It serves to eliminate new product ideas that are inconsistent with the organization's new product strategy or are obviously inappropriate for some other reason.

A) Applied diffusion
B) Introductory diffusion
C) Business Analysis
D) Test marketing
E) Idea screening

Question 44

_____ takes new technologies and attempts to find useful applications for them.

A) Product development
B) Brainstorming
C) Basic research
D) Applied research
E) Concept testing

Question 45

After the research team at DairyMade had generated more than two dozen new product ideas for a substitute for coconut that tastes the same but has zero cholesterol,the company formed a committee to analyze whether the product ideas were consistent with the organization's new-product strategy.This is called:

A) business analysis
B) diffusion
C) idea screening
D) test marketing
E) idea generation

Question 46

Mosaic Labs has developed a chemical compound that prevents mildew in even the most humid climates.The week after the compound was invented,a group of the firm's employees got together and listed ways the product might be used.This is an example of:

A) focusing grouping
B) brainstorming
C) concept testing
D) venture group activities
E) screening

Question 47

A company that manufactures mantels,stairways,doors,windows,and other architectural reproductions brought together a group of ten recent customers and asked them to discuss what they liked and disliked about the current designs marketed by the company.Which of the following research techniques did the manufacturer use?

A) venture team
B) brainstorm
C) buying center
D) product-review committee
E) focus group

Question 48

A manufacturer of athletic equipment is finding it difficult to compete with cheaper imported merchandise.Which of the following is a potential source of new product ideas?

A) current retailers who carry the manufacturer's equipment
B) its foreign competitors
C) the company's employees
D) customers who have requested its catalogs
E) all of these

Question 49

Scientists at Indiana University have received a patent for their newly discovered technologies for more effective customer interface interactions in retail stores.The university decided to sell the patent to an independent company whose scientists immediately began exploration into practical uses of this new technology.The scientists at the independent company are involved in:

A) concept testing
B) brainstorming
C) basic research
D) product development
E) applied research

Question 50

When Forrest Event Marketing,Inc.started searching for new product ideas,a marketing consultant suggested a variety of sources of information.Which is the LEAST likely source of new product ideas?

A) its distributors
B) its customers
C) its employees
D) its financial lenders
E) its competitors

Question 51

The same manufacturer produces Hanes,Playtex,and Bali clothing for women.This manufacturer assembled a group of nine regular customers and asked them to discuss what they like and do not like about its current product line for full-figured women and to suggest new product ideas,such as jewelry,wide shoes,and belts.The manufacturer used a research technique called a:

A) focus group
B) brainstorming session
C) buying center
D) product-review committee
E) venture team

Question 52

_____ is a process where a group thinks of as many ways to vary a product or solve a problem as possible without considering the practicality of the ideas.

A) New product brain dumping
B) Screening
C) A focus group interview
D) Brainstorming
E) Diffusion

Question 53

At what stage of the new-product development process are most new product ideas rejected?

A) test marketing
B) diffusion
C) business analysis
D) idea screening
E) idea generation

Question 54

Until the mid-1990s,MGP Ingredients,Inc.,sold ethanol and animal feed.A steep drop in its sales led the company to focus on developing the first low-carb proteins and starches.The company was able to use existing manufacturing equipment to develop these food additives in response to the growing popularity of the Atkins Diet and similar food regimens.The realization that MGP could use the popularity of the Atkins Diet as a catalyst for success would have occurred in which stage of the new-product development process?

A) screening and concept testing
B) establishing the new-product strategy
C) exploring opportunities
D) developing a business analysis
E) the building of a prototype

Question 55

Scientists at Indiana University are working to develop new technologies for customer interface interactions in retail stores.Right now they are not concerned with the potential cost-effectiveness of the technologies or the marketability of the technologies.These scientists are involved in:

A) brainstorming
B) basic research
C) applied research
D) product generation
E) concept testing

Question 56

A new-product strategy:

A) links the new-product development process with the objectives of the marketing department,the business unit,and the corporation
B) is part of an organization's overall marketing strategy
C) specifies the roles new products play in the organization's overall plans
D) describes the characteristics of products the organization wants to offer and the markets it wants to serve
E) is accurately described by all of these

Question 57

One way to determine whether a company has a balanced portfolio of products and,if not,what new product ideas are needed to offset the imbalance is to use:

A) internal product development venture teams
B) outside consultants
C) marketing development departments
D) status quo committees
E) research ombudsmen

Question 58

An HMO created a focus group to identify new products that it believed would enhance the boomer's aging process.This focus group most likely contained:

A) a sampling of all stakeholders from the sponsoring HMO
B) people who would be categorized as baby boomers
C) health care providers
D) people representing the different segments of the family life cycle
E) member of competitive HMOs

Question 59

The first stage of the new-product development process is:

A) screening and concept testing
B) establishing the new-product strategy
C) exploring opportunities
D) developing a business analysis
E) the building of a prototype

Question 60

_____ is scientific investigation aimed at discovering new technologies.

A) Applied research
B) Brainstorming
C) Basic research
D) Product development
E) Concept testing

Question 61

A(n)_____ typically entails showing members of the product's target market advertising and other promotional materials for several products,including the test product.These people are then taken to a mock or real store where their purchases are recorded.

A) adoption-rate test
B) real test market
C) concept test
D) simulated (laboratory)market test
E) consumer juried test

Question 62

The maker of Lysol disinfectant tested consumers' reactions to its Lysol Sanitizing Wipes by getting consumers to look through a newspaper with grocery store ads,make out a grocery list,and then "shop" in a mock store filled with real products,including the new cleaning product.This is an example of a(n):

A) adoption-rate test
B) simulated (laboratory)market test
C) concept test
D) use test
E) juried consumer test

Question 63

The final stage in the new-product development process is:

A) product testing
B) market testing
C) commercialization
D) product prototyping
E) simulated marketing

Question 64

The screening and concept testing stage of the new product development process is used to:

A) eliminate undesirable ideas and predict consumer acceptance
B) refine the promotion campaign to be used with the new product
C) determine the potential profits to be gained from the new product
D) determine how long the test market should be run
E) generate new product ideas

Question 65

Sara Lee,the maker of Ball Park franks,has decided to introduce its new Ball Park hot dog buns in a limited market consisting of only four cities and to closely monitor the reactions of potential customers to the product and marketing program.Sara Lee is going to use:

A) profitability analysis
B) market development analysis
C) discontinuous innovation
D) laboratory testing
E) test marketing

Question 66

Canesta has developed a virtual keyboard out of light to be used with cell phones and personal digit assistants.The product beams an image of a keyboard on a desk,allowing the user to type on the image.The words are picked up by the user's digital device.During the _____ stage of its new-product development process,a group was assigned the task of estimating preliminary demand for the product,costs,sales,and future profitability.

A) business analysis
B) idea generation
C) concept testing
D) screening
E) test marketing

Question 67

Which of the following has been found to be an efficient substitute for traditional methods of conducting test markets?

A) product sampling
B) simulated product adoption
C) online test marketing
D) simulated diffusion
E) market concentration

Question 68

_____ is a limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation.

A) Use testing
B) Test marketing
C) Concept testing
D) Laboratory testing
E) Discontinuous innovation

Question 69

A European dairy,which is famous for its rich ice creams,has introduced basil,tomato,fennel,and oregano flavored ice creams.In the process of developing these new flavors,the dairy surveyed world-famous chefs to determine which nontraditional flavors had the greatest level of marketability.This survey would have happened during which stage of the product development process?

A) concept testing
B) brainstorming
C) basic research
D) idea screening
E) applied research

Question 70

_____ evaluate new product ideas usually before any prototype has been created.

A) Concept tests
B) Simulated market tests
C) Market tests
D) User tests
E) Venture analyses

Question 71

In the _____ stage of new-product development,preliminary demand,cost,sales,and profitability estimates are made.

A) prototype screening
B) idea generation
C) concept testing
D) post-brainstorming
E) business analysis

Question 72

In the _____ stage of new-product development,the technical feasibility of manufacturing the new product is examined as a prototype is produced.

A) screening
B) development
C) market testing
D) concept testing
E) business analysis

Question 73

Top managers at a company that publishes regional magazines considered making maps,but then decided maps were not within the company's corporate mission.Which stage of the new-product development process did its new-product development process reach?

A) development
B) idea generation
C) idea screening
D) business analysis
E) customer testing

Question 74

After Mattel evaluated many new products to add to its Barbie product line and before any prototype was created,the toy manufacturer instructed a committee to select three of the ideas to present to a group of consumers.The consumer group was asked to evaluate the three product ideas in terms of their marketability.This stage of new-product development is called:

A) prototype screening
B) concept tests
C) market testing
D) idea manipulation
E) idea diffusing

Question 75

When selecting a test market city,a researcher should look for a city:

A) where the demographics and purchasing habits mirror the overall market for the product
B) that has media spillover from other cities to increase media alternatives
C) that is as large as possible
D) that has limited distribution
E) where there is no competition

Question 76

During the ______ stage of the new-product development process,production starts,inventories are built up,the product is shipped to distribution points,the sales force is trained,and advertising and promotion begins.

A) commercialization
B) product testing
C) market analysis
D) product prototyping
E) simulated marketing

Question 77

The development stage of the new-product development process works best when ______ is practiced.

A) competitive product equity
B) simultaneous product development
C) laboratory testing
D) test marketing
E) the new-product paradigm

Question 78

Which of the following statements about simultaneous product development is true?

A) Simultaneous product development refers to the practice of developing multiple new products at the same time.
B) With simultaneous product development,all relevant functional areas and outside suppliers participate in all stages of the new-product development process.
C) All departments within the company work together at the same time,but to maintain a high level of secrecy,no one outside the company is involved in simultaneous product development.
D) Simultaneous product development actually increases the length of time it takes to get a product to market and the time the product will stay in the growth stage of its product life cycle.
E) All of these statements about simultaneous product development are true.

Question 79

Landingham Laboratories has decided to introduce its new over-the-counter antibiotic for ear infections in a limited market consisting of only two cities,and to closely monitor the reactions of potential customers to the product and its marketing program.This is called:

A) diffusion analysis
B) use test
C) dual distribution
D) test marketing
E) laboratory testing

Question 80

The maker of Skittles candy kitchen 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-flavored Skittles.This was an example of a(n)_____ test.

A) adoption-rate
B) concept
C) laboratory
D) market
E) diffusion