Deck 8: Product, Branding, and Packaging Decisions

Question 1

Natalie is a stockbroker who is comfortable using her old phone, which does nothing more than make calls and send and receive text messages.Though her work requires her to be updated about the stock market throughout the day, she decides to wait for the smartphone market to mature and for the prices to decrease.She decides to invest in a smartphone only after being convinced that the price is just right for her budget.Natalie belongs to the group of buyers.

A)innovator
B)laggard
C)lead user
D)early adopter
E)late majority

Answer 1

E

Question 2

Firms try to target innovators while introducing new products into the markets because innovators:

A)prefer products from established market leaders.
B)are easily influenced by advertising.
C)are regarded by other consumers as highly knowledgeable and firms will ask for their suggestions.
D)are considered opinion leaders and influence other majority groups.
E)form a major group of consumers in the market.

Answer 2

C

Question 3

The group of buyers who enter a new product market when the product has achieved its full market potential are referred to as the:

A)early adopters.
B)innovators.
C)laggards.
D)late majority.
E)early majority.

Answer 3

D

Question 4

Eric is enthusiastic about online video games.He has extensive knowledge about the technical aspects of developing games and usually purchases licensed versions of most of the games as soon as they are launched.Eric belongs to the group of buyers.

A)early adopter
B)early majority
C)lead user
D)innovator
E)late majority

Question 5

The category of buyers who tend to enjoy novelty and are regarded as the opinion leaders for particular product categories because they are responsible for spreading the word to next groups are called:

A)early adopters.
B)early majority.
C)late majority.
D)innovators.
E)laggards.

Question 6

The category of buyers who wait and purchase a product after careful review are called:

A)innovators.
B)laggards.
C)early adopters.
D)late majority.
E)lead users.

Question 7

According to the diffusion of innovation theory, buyers belonging to the early majority group are considered crucial because:

A)they act as opinion leaders and spread the word to the next groups entering the market.
B)they are regarded as highly knowledgeable and are not price sensitive.
C)very few products or services can be profitable until this group buys them.
D)they avoid change and rely on traditional products until they are available.
E)they keep themselves very well informed about the product category.

Question 8

The buyers who want to be the first to have a new product or service are called:

A)lead users.
B)laggards.
C)early adopters.
D)first movers.
E)innovators.

Question 9

The category of innovators differs from the category of early adopters in that early adopters:

A)help the product gain market acceptance by spreading positive word of mouth.
B)enjoy taking risks and are not price sensitive.
C)want to be the first on the block to have a new product or service.
D)tend to enjoy novelty and purchase a product after careful review.
E)are regarded as highly knowledgeable as they keep themselves well informed about the
Different product categories.

Question 10

Jeremy is interested in buying a phone that has a music player and provides access to the Internet.After doing a detailed analysis of all the phones in the market that offer these features, he decides to buy a recently released model.Jeremy's buying behaviour is similar to the buying behaviour of:

A)innovators.
B)early adopters.
C)laggards.
D)early majority buyers.
E)late majority buyers.

Question 11

Personal music players that were initially released into the market were expensive, huge, and provided limited options.Anna and her husband did not buy at that time and waited for more selection.When they finally bought the product, the sales had levelled off and the size and prices had reduced significantly.Anna and her husband belong to the group of buyers.

A)innovator
B)laggard
C)late majority
D)early majority
E)early adopter

Question 12

Although Scott wants to buy a mobile that operates with the Android OS, he decides to wait until more mobile companies release models with the Android OS.This way a lot of user reviews will become available and the drawbacks of this OS will become popular knowledge.Scott's buying behaviour shows that Scott belongs to the group of buyers.

A)innovator
B)laggard
C)late majority
D)early majority
E)early adopter

Question 13

The process by which ideas are transformed into new products and services that help firms grow is known as:

A)prototyping.
B)innovation.
C)diffusion.
D)adoption.
E)brainstorming.

Question 14

Buyers who enjoy taking risks, are regarded as knowledgeable, and are not price sensitive are called:

A)laggards.
B)innovators.
C)early adopters.
D)early majority.
E)late majority.

Question 15

The group of buyers who act as opinion leaders and are responsible for bringing the early and late majority groups into the market are known as:

A)innovators.
B)lead users.
C)pioneers.
D)laggards.
E)early adopters.

Question 16

Brenda wanted to buy an LCD TV when it was released, but waited for more options and better quality.She bought it at a later stage when companies reduced the prices because of competition in the market.Brenda belongs to the group.

A)innovator
B)laggard
C)late majority
D)early majority
E)early adopter

Question 17

The term di fusion of innovation refers to the:

A)degree of vertical integration between a manufacturer and its suppliers.
B)process in which a statement that describes a product or a service is presented to potential buyers or users to obtain their reactions.
C)process by which a product or a service spreads throughout a market group over time and over various categories of adopters.
D)process of balancing various engineering, manufacturing, marketing, and economic considerations to develop a product.
E)taking apart a competitor's product, analyzing it, and creating an improved product that
Does not infringe on the competitor's patents.

Question 18

Firms that invest in the latest technology, either to use in their new products or services or to make the firm more efficient, are considered:

A)first movers.
B)innovators.
C)lead users.
D)laggards.
E)early adopters.

Question 19

Which of the following is an advantage for product pioneers in new product development?

A)They make high profits as soon as they enter the market.
B)They become readily recognizable to consumers.
C)They have to share the market with very few competitors.
D)These products always succeed in the marketplace because of lack of competition.
E)They need not focus on creating demand for a specific brand.

Question 20

Greg always consults Vernon before upgrading his personal computer as Vernon is knowledgeable and always has the latest technology.Vernon belongs to the group of according to the diffusion of innovation theory.

A)innovators
B)laggards
C)late majority buyers
D)early majority buyers
E)early adopters

Question 21

Which of the following would a firm that wants to be pioneer in new product development most likely use to generate ideas for products?

A)licensing
B)customer input
C)reverse engineering
D)internal research and development
E)market research

Question 22

An electronics company manufactures LCD TVs that are in high demand when compared to competitor products.Competitors find it difficult to provide the same reliability and after-sales service that this company provides, which leads to high consumer acceptability.The factor that is contributing the high adoptability of this product is:

A)compatibility.
B)complexity.
C)trialability.
D)relative advantage.
E)observability.

Question 23

The diffusion of innovation theory is useful for firms because it helps them:

A)survive in a market where sales come from mostly new products.
B)develop effective promotion, pricing, and other marketing strategies.
C)reduce risk by diversifying into a broad portfolio of products.
D)satisfy the needs of only the current customers.
E)create value for their products and services.

Question 24

Safe Homes is a company that provides security-related products to its consumers.However, the burglar alarm system introduced by the company failed because consumers had to possess a certain level of technical skill to use the product effectively.The factor affecting the adoption rate of these alarm systems is:

A)complexity.
B)trialability.
C)compatibility.
D)relative advantage.
E)observability.

Question 25

A company manufacturing jukeboxes introduced its new jukeboxes in a few malls in Toronto.They were an instant success because of touchscreen operated menus that provided easy access to songs.The success of the jukeboxes can be attributed to low:

A)trialability.
B)complexity.
C)observability.
D)relative advantage.
E)compatibility.

Question 26

A biscuit company manufactures unique fish-shaped biscuits that are popular with kids.Kids love the distinct shape and novel taste.The characteristic of the biscuit contributing to its popularity is:

A)trialability.
B)observability.
C)complexity.
D)compatibility.
E)relative advantage.

Question 27

Edward, a senior professor of statistics at the University of New Brunswick, has authored a wide range of textbooks about statistics.Edward still prefers to use a typewriter while typing material for his new books as he is not comfortable using a desktop computer.This shows that Edward belongs to the group of in the diffusion of innovation process.

A)innovators
B)laggards
C)late majority buyers
D)early majority buyers
E)early adopters

Question 28

The category of buyers who tend to avoid change and rely on traditional products until they are no longer available are called:

A)innovators.
B)early adopters.
C)lead users.
D)pioneers.
E)laggards.

Question 29

A group of scientists at a biotechnology firm conducted extensive trials in a laboratory for over a year before developing a formula that could be used to develop a drug to treat cancer.The firm invested a lot of money in these trials with the idea of generating revenue through sales.The method being used by the company to develop the new product is most likely:

A)licensing.
B)reverse engineering.
C)internal research and development.
D)brainstorming.
E)concept testing.

Question 30

Ronen, a chef at a hotel, has developed an idea for a new dish.The owner of the hotel is impressed with the new recipe and asks all the chefs at the hotel to practise making the new dish for three months until they can reproduce the recipe with the exact taste the owner is looking for.The chefs also test the dish on other hotel staff before introducing it to customers.The method of idea generation being used by the owner is:

A)brainstorming.
B)internal research and development.
C)customer research.
D)licensing.
E)reverse engineering.

Question 31

Baked Treats introduced maple syrup cookies that became an instant hit with Canadians.The product characteristic that contributed to the success of these cookies was:

A)compatibility.
B)trialability.
C)complexity.
D)visibility.
E)observability.

Question 32

An advertising agency asks its staff to assemble in groups in the presence of a moderator and generate ideas for developing an advertisement for a new product for a client.The method of idea generation being used by the agency is:

A)licensing.
B)customer research.
C)internal research.
D)reverse engineering.
E)brainstorming.

Question 33

Alttaire automobiles developed new hybrid cars that were highly fuel-efficient and less polluting compared to all the competitors' cars in the current market.These cars achieved instant success in the market because of their unique features.The factor that is influencing the high adoption rate of these cars is:

A)complexity.
B)compatibility.
C)observability.
D)relative advantage.
E)trialability.

Question 34

A leather company manufactures high-quality handbags for women.All bags carry a prominent logo of the company and consumers associate this logo with excellent quality.Despite their high price, these handbags are extremely popular.The factor affecting the quick diffusion of these handbags is:

A)complexity.
B)relative advantage.
C)trialability.
D)compatibility.
E)observability.

Question 35

A fast-food outlet introduced new burgers made with cheese that had low fat content and a unique taste.This ingredient brought down the price of the burgers and the burgers were an instant success in the market.Which of the following was responsible for the quick diffusion of the burgers?

A)compatibilty
B)complexity
C)trialability
D)observability
E)relative advantage

Question 36

The first step in the development of new products is to:

A)develop visual images of what the product would look like.
B)develop brief written descriptions about the working principle of the product.
C)present an idea to potential buyers to obtain their reactions.
D)develop new ideas by either internal research or market survey.
E)conduct in-depth interviews to test the concept of the new product.

Question 37

Protégé Inc.produces hockey accessories in Canada.As first movers, the company was able to fulfill the high demand for these accessories in Canada where hockey is a popular sport.Which of the following is a product characteristic that contributed to the high diffusion of products from Protégé Inc.?

A)complexity
B)trialability
C)compatibilty
D)visibility
E)observability

Question 38

The owner of a fast-food restaurant in a city continues to accept only cash for transactions, although credit/debit cards are common practice in other business establishments.The owner has not adopted the technology because of her fears with regard to the security of these transactions.Hence, she can be considered a(n):

A)early adopter.
B)innovator.
C)laggard.
D)lead user.
E)pioneer.

Question 39

Ariva, a product design company, has brought together a group of technology engineers to generate ideas for potential new products.These engineers will arrive at a final decision through a vote on the best ideas or combinations of ideas.Ariva is engaging in:

A)prototyping.
B)interviewing.
C)reverse engineering.
D)brainstorming.
E)licensing.

Question 40

Technosoft Ltd.provides a pay-per-use option to its business customers that allows them to understand the product's capabilities before they order licensed versions on a large scale.This option has made Technosoft extremely popular with firms that plan to invest on IT infrastructure but have limited funds.The factor that is contributing to the success of
Technosoft is:

A)compatibility.
B)complexity.
C)relative advantage.
D)observability.
E)trialability.

Question 41

A brief written description of a product or service; its technology, working principles, and forms; and what customer needs it satisfies is a:

A)data.
B)hypothesis.
C)theory.
D)concept.
E)information.

Question 42

Infotech Inc., a technology firm, is trying to develop new software that will facilitate the transfer of documents in a secure and fast manner.The engineering team at the firm is having a detailed discussion on the best possible options.This type of idea generation is called:

A)licensing.
B)customer research.
C)brainstorming.
D)market research.
E)internal research.

Question 43

Thomson Furniture Company is struggling to improve its sales.The sales of Branson, a major competitor, are soaring because of the company's well-designed and innovative products.Thomson decides to study Branson's designs in an attempt to understand how it is doing so well.Finally, Thomson creates an improved product that does not infringe on Branson's patents.This type of idea generation is known as:

A)brainstorming.
B)prototyping.
C)reverse engineering.
D)customer research.
E)concept testing.

Question 44

The manager of an ice cream parlour is planning to introduce new flavours into his product line.He decides to take feedback and suggestions from consumers as part of the process to develop innovative and interesting new ice cream flavours.He is using for idea generation.

A)internal research
B)reverse engineering
C)brainstorming
D)customer input
E)licensing

Question 45

Molly Ann, a clothing company, is unable to improve sales after its designer failed to create designs that satisfied current trends in the market.Rigby, on the other hand, is having a successful season and its designs are the current rage in the market.After a careful study of Rigby's designs, Molly Ann analyzed them, improved upon them, and created a whole new range of designs.The method of idea generation being used by Molly Ann is:

A)concept testing.
B)alpha testing.
C)prototyping.
D)brainstorming.
E)reverse engineering.

Question 46

Annie is a designer at a popular clothing brand.She observes people on the streets who modify the clothing according to their needs and styles.Annie uses this input while designing new collections.The method of idea generation used by Annie in developing new products is called:

A)interviewing.
B)licensing.
C)internal research.
D)brainstorming.
E)customer input approach.

Question 47

Which of the following processes is used to test the performance of a product prototype and is carried out in the research and development unit of a firm?

A)alpha testing
B)beta testing
C)premarket tests
D)test marketing
E)concept testing

Question 48

Which of the following idea generation methods saves the high costs of in-house research and development for a firm?

A)brainstorming
B)licensing
C)customer inputs
D)reverse engineering
E)market research

Question 49

Alice asks a group of people to test the skateboards she has manufactured.She needs to determine whether or not they are functioning as intended and if they require any changes before they are released.The type of test being conducted by Alice is called:

A)concept testing.
B)test marketing.
C)hypothesis testing.
D)beta testing.
E)alpha testing.

Question 50

The process by which an idea that describes a product or a service is presented to potential buyers to obtain their reactions is called:

A)test marketing.
B)product development.
C)concept testing.
D)diffusion of innovation.
E)reverse engineering.

Question 51

A cosmetics company, which mainly produces soaps, shampoos, and other skin solutions for adults, wants to introduce a line of baby products into the market.Since it has no prior experience with baby products, it decides to buy the rights to use the necessary technology from a small research firm.The method of idea generation used by the cosmetics company is:

A)internal research and development.
B)brainstorming.
C)prototyping.
D)licensing.
E)reverse engineering.

Question 52

The method of testing which requires potential consumers to examine a product prototype in a real-use setting is known as:

A)conclusive research.
B)beta testing.
C)concept testing.
D)alpha testing.
E)reverse engineering.

Question 53

A group of scientists in a pharmaceutical firm are conducting trials of the new formula they have developed to be used in a drug in the research and development unit of the firm.This method of testing a product prototype is known as:

A)beta testing.
B)test marketing.
C)premarket tests.
D)concept testing.
E)alpha testing.

Question 54

A key characteristic of brainstorming sessions used to generate new ideas is that:

A)all the ideas generated are exceptionally good because the group includes experts.
B)all the ideas generated will be accepted and implemented at later stages.
C)the ideas generated will require no further testing because they are provided by industry experts.
D)no idea can be immediately accepted or rejected.
E)the ideas generated considerably reduce the high start-up costs.

Question 55

An automobile firm wants to introduce cars into new international markets to increase its customer base.Since it does not know about customer needs in these markets, it associates itself with a local firm that has developed a prototype based on the customer needs of that market.The method of idea generation used by the automobile firm is:

A)licensing.
B)customer research.
C)internal research.
D)reverse engineering.
E)brainstorming.

Question 56

The method of idea generation that involves the analysis of a competitor's product is known as:

A)prototyping.
B)reverse engineering.
C)concept testing.
D)brainstorming.
E)alpha testing.

Question 57

When the product design team of a firm takes ideas with potential, develops them into visual images, and presents them to potential buyers to get their reactions, they are engaging in:

A)brainstorming.
B)idea generation.
C)concept testing.
D)prototyping.
E)reverse engineering.

Question 58

The process of balancing various engineering, manufacturing, marketing, and economic considerations to develop a product is called:

A)concept testing.
B)idea generation.
C)product launching.
D)alpha testing.
E)product design.

Question 59

The first physical tentative form of a new product that has the same properties as a new product but is produced through different manufacturing processes is called a(n):

A)concept.
B)theory.
C)hypothesis.
D)prototype.
E)image.

Question 60

Innovative product users who modify existing products according to their own ideas to suit their specific needs are called:

A)pioneers.
B)lead users.
C)innovators.
D)laggards.
E)early adopters.

Question 61

During the growth stage of a product life cycle, firms attempt to:

A)successfully market a newly launched product.
B)reach new consumers by studying their preferences and producing different product variations.
C)increase their customer base by entering into new markets or market segments.
D)defend their market share by developing new products or promotions.
E)market their products to a niche segment of loyal customers.

Question 62

A new product launched by a company is showing a rise in sales and a rapid rise in profits, and is being purchased by a group of early adopters and early majority buyers.The product is in the stage of its life cycle.

A)introduction
B)growth
C)decline
D)maturity
E)initiation

Question 63

The method of testing being employed by the cosmetics firm to test its product in the above scenario is:

A)premarket testing.
B)test marketing.
C)alpha testing.
D)concept testing.
E)beta testing.

Question 64

An automobile firm is positioning its product to serve only a specific group of brand loyalists.This shows that the particular product is in the stage of its life cycle.

A)maturation
B)growth
C)decline
D)introduction
E)levelling

Question 65

Which of the following steps involved in new product introduction is regarded as the most crucial because it requires huge financial resources and extensive coordination of all aspects of the marketing mix?

A)idea generation
B)concept testing
C)product launch
D)product development
E)evaluation of results

Question 66

In which of the following stages of the product life cycle are sales low and profits small or negative?

A)introduction
B)levelling
C)maturity
D)growth
E)decline

Question 67

After the new product is released into the market, the category of buyers who will play a crucial role in the initial marketing of this product are:

A)early adopters.
B)innovators.
C)early majority.
D)late majority.
E)lead users.

Question 68

Which of the following stages in the product life cycle is characterized by an increase in sales, rapid increase in profits, and a few but increasing number of competitors?

A)the growth stage
B)the introduction stage
C)the maturity stage
D)the levelling stage
E)the decline stage

Question 69

Which of the following is true regarding the introduction stage of the product life cycle?

A)It is marked by a rapid growth in industry sales and also an increase in the number of competitors.
B)At this stage, firms attempt to reach new customers by studying their preferences and producing different product variations.
C)It usually starts with a single firm, and innovators form the main category of buyers.
D)It is characterized by intense competition for market share by firms, which leads to an increase in marketing costs.
E)It is marked by a growing number of product adopters and also an increase in the number
Of product versions available.

Question 70

The later phases of the maturity stage of a product are characterized by:

A)increased sales.
B)market saturation.
C)an increase in profits.
D)less market segmentation.
E)increasing numbers of early adopters.

Question 71

Which of the following is true regarding the maturity stage of the product life cycle?

A)It is characterized by the adoption of products by early adopters and early majority.
B)Firms try to ride the sales trend and firmly establish the brand during this stage.
C)It is characterized by rising sales, increasing profits, and few competitors.
D)Most firms usually exit the market at this stage on account of low profit margins.
E)It is characterized by increased marketing costs, low profits, and market saturation.

Question 72

The method of determining the potential success of a new product by introducing the product to a limited geographical area prior to a national launch is called:

A)alpha testing.
B)beta testing.
C)concept testing.
D)test marketing.
E)premarket testing.

Question 73

The method used by the engineering team at the firm to test the product prototype is known as:

A)beta testing.
B)concept testing.
C)test marketing.
D)premarket test.
E)alpha testing.

Question 74

The firm marketed its product by educating consumers about the benefits of the additional feature it provided in its product.The marketing mix variable that benefited from the results of the tests is:

A)timing.
B)promotion.
C)place.
D)price.
E)size.

Question 75

The test conducted by firms before a newly developed product or service is brought to the market to determine how many customers will try it and then continue to use it is known as:

A)a premarket test.
B)alpha testing.
C)beta testing.
D)a concept test.
E)hypothesis testing.

Question 76

The method employed by the research team at AG-Mobile for idea generation is:

A)licensing.
B)brainstorming.
C)reverse engineering.
D)customer research.
E)observation of lead users.

Question 77

Firms either position themselves for a niche market of loyal consumers or they exit the market during the stage of the product life cycle.

A)introduction
B)levelling
C)maturity
D)growth
E)decline

Question 78

A manufacturing firm has recently launched a new product and has no competitors in the market.Innovators have started buying the product.The product is in the stage of the product life cycle.

A)growth
B)maturity
C)introduction
D)decline
E)levelling

Question 79

Which of the following stages of the product life cycle is characterized by a peak in sales and a high number of competitors and competitive products but a gradual decline in profits?

A)introduction
B)growth
C)maturity
D)decline
E)initiation

Question 80

A cosmetics company had launched a product in the market that earned good revenues for the company.A recent market analysis shows intense competition for market share from a large number of competitors.The company decides to spend more on marketing the product to help it to retain its market share.The product is currently in the stage of its life cycle.

A)maturity
B)growth
C)initiation
D)introduction
E)decline