Deck 12: The Product Experience: New Product Development

Question 1

Success or failure of a new product is determined primarily by the actions of the company.Making bad decisions by not identifying the value proposition, designing and building a product that fails to meet customer expectations and incorrectly pricing the product are all factors that increase the likelihood of new product failures.

Answer 1

True

Question 2

The number of products purchased by the same customer is called repeat purchases.This can be important with things like stereos and cell phones because they rely on loyalty for success.

Answer 2

False

Question 3

Brand-new technologies are what people often consider a "new product." An example of this is the group of companies working on harnessing the wave action of the oceans off the Scottish Coast and other rough sea areas.

Answer 3

True

Question 4

One of the key concerns during the new product introduction process is how long will it take for the product to move through the product life cycle.

Question 5

Google has followed a new model to test its ideas for new products.It allows consumers to try lots of new products to see which ones stick.Many products are put into the market in this way but only a few survive the process.

Question 6

develop the product opportunity.

Question 7

Large and small companies face the same issues when it comes to developing new products.

Question 8

When consumers purchase a product for the purpose of making a value decision in the product adoption process, it is called the trial stage.

Question 9

If a product is not successful early in a new product launch, management is often unwilling to spend additional dollars as the product becomes more widely distributed.The end result is usually a downward spiral.

Question 10

Google, Yahoo and Microsoft all maintain a dedicated staff to identify and destroy new start-up organizations with great new product ideas.

Question 11

The challenge for the new product development team is to design and build a product the customer wants to buy while hitting the company's success metrics--sales price, revenue, profit margins, unit sales, and cost to build.

Question 12

Products being developed in the new product development process are often given code names until they are ready to go to test market.During test market they still carry the code name until the product is ready to be fully commercialized.

Question 13

BMW has used the concept "Ban Boredom" as one of the key benefits of its Mini line.For the people in the Mini's target market, this is an attractive benefit.

Question 14

Pfizer boasts the largest R & D spending in the industry.It has more than 400 chemical compounds in various stages of research across a number of therapeutic areas.This is done to have an extensive pipeline from which to draw new successful products.

Question 15

Cisco developed a technology called In-Store Mobility Solution.This technology gave shoppers access to information and allowed shoppers to receive promotions while on the move, create shopping lists, and navigate a store directly from the shopping cart.

Question 16

Early adopters are opinion leaders who seek out new products but are price sensitive to innovation.

Question 17

Research suggests that consumers prefer environmentally sensitive products, but are unwilling to pay a significant price premium.

Question 18

In the product adoption process consumers move through five stages that can be described as awareness, interest, desire, trial and rejection.

Question 19

One of the ways that U.S.car manufacturers have beaten the Japanese is with new product development time.The U.S.now beats the Japanese in the time it takes to develop new car models.

Question 20

When a new product is developed and test marketed, companies often face a critical decision with respect to going to full market introduction.The technique often used by companies is their gut feeling about the success or failure of the new product.

Question 21

Success or failure of a new product is determined by the action of the company.The factor or factors that increase the likelihood of failure can be described as _______.

A) Poor marketing communications
B) Failure to meet customer expectations
C) Incorrect pricing
D) Failure to identify the value proposition
E) All of the above

Question 22

The new product development process is a difficult one.The time it takes to develop a new product is ___________.

A) Increasing
B) The same as it has always been
C) Shorter
D) Indefinite due to the nature of financial markets
E) None of the above

Question 23

For some start-up companies, the main reason for failure of new products is _________.

A) Lack of technology
B) Lack of capital
C) Fuzzy logic
D) Access to distribution markets
E) None of the above

Question 24

Customers view new products much differently than companies.Customers only care if the product is ______.

A) New to their retail store
B) New to them
C) Offered through a new outlet
D) Offered on-line instead of a brick and mortar store
E) None of the above

Question 25

Desktop computers, cell phones, and PDAs are examples of new-to-the-world products considered _________.

A) Disruptive innovations
B) Continuous innovations
C) Popular innovations
D) Successful innovations
E) All of the above

Question 26

No matter how good a company's current products are, long term growth depends on _________.

A) Recycled products
B) Product deletions
C) Product enhancements
D) New products
E) All of the above

Question 27

Products that are new-to-the-world create a product situation which can be described as ______________.

A) Supply chain shifting
B) Innovation by intimidation
C) Diluted innovation
D) Disruptive innovation
E) None of the above

Question 28

John Deere has initiated a new environmental service for its farmer customers.It subsidizes __________ in order to show its commitment to the environment.

A) Fuel efficient tractors
B) Hybrid fuel vehicles
C) Wind turbines
D) Utility companies
E) All of the above

Question 29

New product development is a critical success factor for most organizations.The percent of new products that fail worldwide is ________.

A) 20 to 30 percent
B) 30 to 50 percent
C) 50 to 70 percent
D) 70 to 80 percent
E) None of the above

Question 30

When a new-to-the-world product are better, faster versions of existing products that target, for the most part, existing customers it is said that these products are ___________.

A) Neo innovations
B) Subtle innovations
C) Left handed innovations
D) Sustaining innovations
E) None of the above

Question 31

New-to-the-world products are products that _______.

A) Have been available before but are recycled
B) Products that are innovative but only slightly different than previous products
C) Have not been available before their introduction to the market
D) Are not disruptive to the market place
E) None of the above

Question 32

________________ are the single best source for new product ideas.

A) Consultants
B) Market surveys
C) Outside laboratories
D) Search engines
E) Inside sources

Question 33

Frito-Lay, the world's largest seller of snack foods, defends its shelf space from competition by _________.

A) Outspending its competitors with television advertising
B) Setting audacious goals for its sales force
C) Having its drivers pull the competitors products off the shelf when they are not looking
D) Introducing coupons and retailer incentives to keep its position on the shelf
E) All of the above

Question 34

One way to extend the product is by creating ___________.

A) Additions to existing product lines
B) New names for the same products
C) Products from a different industry to your industry
D) Products that look like the competitions but are not really different than the competitions'
E) None of the above

Question 35

In the product development process in high-technology, it is possible that traditional research with focus groups from existing customers might not work as a result of ________.

A) Being unable to explain the concept clearly
B) Having a value proposition that is not clear
C) Operating beyond the vision of your own customers
D) Operating in a vacuum without input
E) All of the above

Question 36

One challenge facing companies is to generate new ideas for products.A good source for new-product ideas come from internal employees from ________.

A) R & D
B) Marketing
C) Manufacturing
D) All of the above
E) None of the above

Question 37

When a product like cell phones has been aimed as a safety device for working women and moms, one way to find "new" markets is to _________.

A) Add features to the phones
B) Sell added benefits to the existing customers
C) Reposition the existing products to new markets
D) Alter the billing so more people can afford the product
E) All of the above

Question 38

CAFE standards are ________.

A) Standards for restaurants called cafes to make better food
B) Standards for coffee consumed on premise
C) Standards for corporate average fuel economy for automakers
D) Standards for coffee makers in order to achieve improved environmental standards
E) None of the above

Question 39

Rick Rotondo, Chief Marketing Officer for Spectrum Bridge, Inc., says that if you do a poor job defining your core product you will likely _______.

A) Miss your product analysis goals
B) Miss your true market potential
C) Make bad media decisions
D) Elevate your goals to a point that it is difficult to meet them
E) None of the above

Question 40

Companies are creating ________.

A) More specialized products that address the demands of smaller groups
B) More generic products aimed at broad market swatches
C) More engineered products that work across many different platforms
D) More customized bargain goods that are easy to harvest
E) None of the above

Question 41

An analysis of a new producing the screening stage often includes an internal assessment by ________.

A) Finance, marketing, R & D, manufacturing and logistics
B) The ethics committee for new products
C) The product line coordinator for the area the new product is going to be located
D) The new product development coach hired to coach the process for getting the new product to market
E) All of the above

Question 42

Time to market is a term that means _________.

A) This is the best time to market this new product
B) It is time that the company had an entry into a particular market segment
C) How long will it take to develop and get the product to market
D) How long will it take to get the product through the introductory stage to the growth stage
E) None of the above

Question 43

The third stage of the new-product development cycle is _________.

A) Define the product definition
B) Define the product opportunity
C) Define the total value proposition of the cycle
D) Define the trim and vigor of the new concept
E) Define the Google search potential for the new product

Question 44

In testing a new product concept in the definition and test concept phase of developing a new product, the company discovers that consumers want something that is not included in the product.This creates a dilemma for the company that may result in __________.

A) Doing additional research until we get consumer input that the product is acceptable in its current form.
B) Abandoning the product due to it not being feasible (too costly to implement, not technically possible)
C) Change the product no matter what the cost and retest to see if it is acceptable to the customer
D) Launch the product as is because consumers do not know what it is they want
E) None of the above

Question 45

KidCare provides a service to pediatric doctor's offices that includes ________.

A) A 32 inch flat screen TV
B) Three to five minute segments on typical child oriented health questions
C) 30 second commercials for outside sponsors
D) DVD's for parents to take home
E) All of the above

Question 46

After a new product is designed in the product development cycle it leads to a distinct set of physical characteristics and a detailed feature mix.At this point, the company would _________.

A) Develop a working prototype that is exactly as the new product will appear to the market
B) Develop a marketing strategy that is detailed but tentative
C) Develop a definitive financial model of the new product
D) Develop a video to send up a trial balloon on U-tube
E) None of the above

Question 47

Nokia discovered that its cell phones in India were being bought by families to share.As a result of their research Nokia __________.

A) Made the phones less expensive
B) Made the phones available in rickshaws
C) Developed creative financial tools so more families could afford its cell phones
D) Developed marketing communications that showed families using the phone together
E) None of the above

Question 48

Firms must _________ new-product ideas from the list of ideas that are generated by the idea generation stage.

A) Rank order each
B) Screen and evaluate as quickly as possible
C) Develop a business plan for each
D) Develop a scale model
E) All of the above

Question 49

Companies often have to delineate the products characteristics which refers to ______________.

A) How the product looks
B) How the product feels
C) The physical elements of the product
D) The features of the product
E) All of the above

Question 50

Many times customers provide ideas to salespeople, customer service representatives, and other direct customer contact people in the firm.These type of inside people and customers generally good at generating ideas that are ________.

A) Game changing products
B) Innovative leaps in design
C) Incremental changes to existing products
D) Challenging for R & D due to their aggressive nature
E) None of the above

Question 51

Before a company develops a full prototype of a new product, it often _________.

A) Creates simulations of the product so consumers can virtually feel like they have experienced the product
B) Creates computer games with the product features and benefits as the avatars in the games
C) Creates advertisements that show the use of the product by the intended product users
D) Creates jingles that will be used to introduce the new prototype to the market
E) All of the above

Question 52

Many organizations are too small to have a national sales force to help discover new-product ideas.As a consequence they often use _______ that offer a link between the customer and company.

A) Distributors
B) Parts manufacturers
C) Logistics companies
D) Server farms
E) None of the above

Question 53

Sales are defined in two ways: revenue (unit sales x price)and unit sales.This is known as __________.

A) New demand
B) Local demand
C) Total demand
D) Inelastic demand
E) Focused demand

Question 54

Generation Millennium Computer Co.is trying to test a new product concept.It would be normal for the company to do ____________.

A) Ask consumers if they would but this product and ask how much are they willing to pay
B) Ask consumers if they like would like changes in the new product design
C) Ask consumers if they perceive the product to be different from other products on the market
D) All of the above
E) None of the above

Question 55

Customers are sometimes excellent sources of new product ideas.An example of this is when _____________.

A) Toyota put a hang tag on its new vehicles to solicit product input
B) Cadbury-Schweppes asked 140,000 of its customers about candy preferences to create the new brand called Trident Splash
C) LG asked 40,000 Koreans about their big screen TV habits
D) Whole Foods studied soup kitchens for natural food recipes
E) None of the above

Question 56

HP gets thousands of product ideas from a variety of sources every year.HP develops ____________ of these ideas every year.

A) Thousands
B) Hundreds
C) At least 100
D) Very few
E) None of the above

Question 57

Some companies like Ford, BMS, and Mercedes-Benz use __________ to get customer focused ideas for product improvements.

A) Large scale mail surveys
B) One focus group per year
C) User group bulletin boards
D) Social scientists to study trends
E) None of the above

Question 58

A go-to-market mistake is made when a company ________.

A) Buys an outside product to mix with its current other products
B) Fails to stop a bad product idea from moving forward into product development
C) Fails to stop advertising when it is clear that the product is not going to make it
D) Fails to order enough new product to supply its customers
E) None of the above

Question 59

Facebook was a start up by two entrepreneurs who just wanted a place to hang out.It grew to 117 million users and was purchased by the News Corp.This is an example of __________.

A) Larger companies not being able to create disruptive innovations on their own
B) Smaller companies being the hot beds for debt-based incubation
C) Predatory pricing by technology companies
D) Companies growing through acquisition of smaller companies with innovative new products
E) All of the above

Question 60

A stop-to-market mistake happens when __________.

A) A bad idea is allowed to make it to market
B) The screening committee decides to market a product that has a fatal flaw
C) A good idea is pushed forward without knowing the ROI of its execution
D) A good idea is prematurely eliminated during the screening process.
E) None of the above

Question 61

With respect to the product life cycle, marketers are interested in knowing ___________.

A) The rate at which the product will be adopted as well as the timeline for adoption
B) The rate at which sales will exceed costs
C) The rate at which the late majority come into the market during growth
D) The rate of the early majority acceptance of the product
E) All of the above

Question 62

In the B2B market, test marketing is ________.

A) Identical to the B2C market
B) Smaller in scope and involve fewer individuals and companies
C) Larger in scope and involve more individuals and companies
D) Extremely different than B2C because of the magnetic variance of the enterprises
E) None of the above

Question 63

Innovators and early adopters are _________.

A) Consumers who buy in the growth stage of the product life cycle
B) Consumers who buy at the introduction stage of the product life cycle
C) Consumers who are information seekers
D) Consumers who love to buy
E) All of the above

Question 64

The new product development process changed in the 1990's due to __________.

A) Increase in failure rates of new products
B) Decrease in the number of new ideas coming to market
C) Development of web based design and research
D) Increase in the cost of taking products to market combined with high failure rates
E) None of the above

Question 65

The greater the ___________, the more market testing a company will want to do before a full product launch.

A) Profit motive of the company
B) Risk of alienation of existing customers
C) Risk of failure
D) Cost of doing nothing
E) All of the above

Question 66

It is typical to develop a ___________ in the new product development cycle during the business case analysis stage.

A) 5 year projected cash flow analysis that includes both short and long term profitability
B) 1 year profit and loss statement due to the unknowns of the long term
C) Cash flow for the completion of the new product development cycle that includes making working prototypes
D) Business description of the market as it looks 20 years from now
E) None of the above

Question 67

Test markets should run long enough to include several purchase cycles and thus last __________.

A) More than a year
B) More than two years
C) Less than two months
D) Less than a year
E) No one really knows how long they should last

Question 68

Market testing is designed to help the company ________.

A) Adjust its marketing plan before product launch
B) Make a decision of whether to launch the product or not
C) Forecast the future from the test
D) A, B and C
E) None of the above

Question 69

The innovation diffusion process __________.

A) Is how long it takes a product to move from introduction to growth
B) Is how long it takes to move from awareness to interest
C) Is how long it takes to move from trial to adoption
D) Is how long it takes a product to move from first purchase to last purchase
E) None of the above

Question 70

Sometimes companies develop quick prototypes of products in order to ___________.

A) See if they can be manufactured
B) Prevent competition from seeing the real thing
C) Get the product in the hands of potential user and to minimize costs
D) All of the above
E) None of the above

Question 71

Products that start poorly in a product launch __________.

A) Seldom recover from the poor launch
B) Recover readily through increased marketing effort
C) Have a life cycle that looks very elastic
D) Have a knack for being the market leader through slow but steady growth
E) None of the above

Question 72

Many product launches are front loaded with communications dollars with the goal of ___________.

A) Seeing if there is any interest in the product
B) Evaluating the product excitement generated
C) Creating sufficient product interest that will turn into repeat and replacement purchases later
D) Studying the product life cycle to see what kind of curve is achievable in the short run so the longer run can be forecasted with some degree of certainty
E) None of the above

Question 73

Early buyers are critical in the success of a new product because _________.

A) They are ore likely to be discerning buyers
B) They are more likely to communicate their preferences and dislikes to others
C) They are less likely to be concerned about product performance
D) They are more motivated by being fashion than product quality driven
E) All of the above

Question 74

One method of developing a new product is to develop a model based upon everything that has gone into the previous steps and continues along the sequential timeline meeting key metrics.In this model the product that results is __________.

A) A rough model that can be changed easily
B) A model that is considered close to the final product that will be rolled out to customers
C) A model that is put together in a form that can be decomposed into parts that can be altered to create new forms
D) A model that is inferior to the final product to test the worst case scenario of market introduction
E) None of the above

Question 75

Once a product is ready to be test marketed, ________.

A) It is marketed under a code name
B) It is marketed with a brand identity and packaging that will be used when commercialized
C) It is marketed under a fake name to hide its real market existence from competitors
D) It is marketed with very different appeals than will be used in the commercialization phase to keep the benefits hidden from competition
E) None of the above

Question 76

Market testing can take a long time, and this can result in ________.

A) Competitors being able to develop marketing strategies to counter a product launch
B) The company losing the excitement of a new product
C) Competitors being able to sabotage the firm's efforts
D) On-line guerilla tactics by competitors that will disrupt the sales cycle of the product
E) None of the above

Question 77

Total demand is a function of three separate situations, which can be described as ___________.

A) New, ideal, and impulse purchases
B) New, repeat, and replacement purchases
C) New, repeat and impulse purchases
D) New, impulse and replacement purchases
E) New, convenient, and impulse purchases

Question 78

The rate at which new products become accepted is know as the _________.

A) Product variance process
B) Product sensitivity process
C) Product adoption process
D) Product steering process
E) None of the above

Question 79

New purchases of new products are called _______.

A) Original purchases
B) Subliminal purchases
C) Purchase novelties
D) Trial purchases
E) All of the above

Question 80

Beta testing is designed to __________.

A) Encourage customers to evaluate and provide feedback on the prototype
B) Let engineers inside the company to test the product performance
C) Give fake information to competitors about the new product
D) Let on-line communities discuss and dissect the new product
E) None of the above