Marketing Chapter 6 Aacsb Reflective Thinking Accessibility Keyboard Navigation Blooms Understand Difficulty Medium Learning Objective

107. The most common ethical issue in new-product development involves the Federal Trade Commission’s definition of the

term _______.

108. The practice in which companies frequently come out with new models of a product that make existing models obsolete is

referred to as _____ _____.

109. _______ is the process by which new products are likely to be adopted, the rate at which they will be adopted, and the

process through which the products will spread into markets.

110. The stage in the consumer adoption process where the customer thinks about the product’s value and whether to try it out

is the _______ stage.

111. The final stage in the consumer adoption process is _______, whereby the consumer actually buys and uses the product.

112. Belinda cannot wait to be the first of her friends to purchase the latest technology. She immediately purchased an iPhone,

an e-reader, and a Blu-Ray disc player as soon as they hit the market. Belinda would most likely be the type of adopter known

as a(n) ________.

113. Consumers that purchase and use a product soon after it has been introduced, but only after product reviews on the item

have been reviewed, are known as _____ _____.

114. _______ are typically older and less educated than other types of adopters, tend to be tied to tradition, and are not easily

motivated by promotional strategies.

115. The superior position a product enjoys over competing products if consumers believe it has more value than other products

in its class is referred to as _____ _____.

116. The new-product characteristic that refers to how well a new product fits into a potential customer’s needs, values, product

knowledge, and past behaviors is _______.

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Blooms: Understand

Difficulty: 2 Medium

Learning Objective: 06-05 Describe the categories of new-product adopters and the implications of adoption to marketers.

Topic: Product Adoption

117. The new-product characteristic that refers to the extent to which culture values “progress” is referred to as _____.

118. Due to the high cost of developing, advertising, manufacturing, and distributing a new product, profits are often low in the

_______ stage of the product life cycle.

119. The main objectives of the _______ stage of the product life cycle are profitability and maintaining the firm’s market share

for as long as possible.

120. Because firms are introducing products at a faster rate, one general trend in marketing is that product life cycles are getting

_______.

121. Products that take longer for consumers to see the benefits of or that do not have a good infrastructure in place to support

them are called _____ _____ products.

122. The price of a product is usually higher in the _______ stage of the product life cycle.

123. Services are intangible products that cannot be touched, weighed, or measured.

124. Revamped products make up the smallest percentage of new products but carry the most risk for the company introducing

them.

125. New-category entries help companies compete better in an already-established market or enter a new market.

126. The recently introduced Sprinkled Donut Crunch is a product-line extension for Quaker Oats’ Cap’n Crunch brand.

127. A company can advertise a product as new and improved for only one year after it hits store shelves.

128. Among other things, the first stage in the new-product strategy development process helps to determine if the idea can be

turned into a product that will prove to be profitable.

129. While the idea generation stage of the new-product development process generates a great number of potential ideas, in

reality, very few of these ideas ever become marketed products.

130. Companies with cultures that value all new-product ideas, whatever the source, tend to develop more blockbuster products

than companies that are unwilling to search far and wide for sources of innovation.

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Topic: New-product Development

131. It is during the idea generation stage of the new-product development process that the company often ends up rejecting

most new goods and services for one reason or another.

132. Concept tests ensure that the product will not be a hazard to users or their families, that it can be produced in the

company’s or supplier’s manufacturing facilities, and that it can be manufactured at a cost low enough to generate profits.

133. Test marketing occurs when a new product is introduced in its final form to a geographically limited market to see how well

the product sells and to get reactions from potential users.

134. During the test-marketing stage, the firm tests not only the product itself but also the marketing strategy related to it.

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Blooms: Understand

Difficulty: 2 Medium

Learning Objective: 06-02 Describe the various stages of new-product development.

Topic: New-product Development

135. Less-expensive forms of test marketing include simulated test markets and online test marketing.

136. The launch stage of the new-product development process is usually the least expensive stage for new products.

137. The new-product development path that utilizes a progressive sequence in which functional areas consecutively complete

their development tasks is referred to as a chronological new-product development path.

138. One of the disadvantages of concurrent new-product development is that it may create tension between functional areas.

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Blooms: Understand

Difficulty: 2 Medium

Learning Objective: 06-02 Describe the various stages of new-product development.

Topic: New-product Development

139. Firms that want to maintain or improve their competitive position in the marketplace generally must develop new products.

140. The highest level of risk for new-product development occurs when products fail to generate sales or prove to be

dangerous and defective.

141. Every stage of the NPD process must be followed for the process to work correctly.

142. The most common ethical issue in new-product development involves the Federal Trade Commission’s definition of the

term improved.

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Difficulty: 1 Easy

Learning Objective: 06-04 Summarize the ethical and sustainability issues in new-product development.

Topic: Ethical Issues in New-Product Development

143. Diffusion gives marketers a way to figure out who will likely buy their product over a period of time, plan an appropriate

marketing mix, and forecast potential sales.

144. The group of adopters that make up the smallest percentage of product adopters is the laggard group.

145. The stage of the product life cycle in which marketing costs rise due to competition as each firm tries to find ways to gain

market share is the maturity stage.

146. During the decline stage, the firm will likely put forth a lot of effort to change a good’s appearance or functionality in order to

generate interest for the product.

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Difficulty: 2 Medium

Learning Objective: 06-06 Describe the stages and aspects of the product life cycle and how they affect the marketing mix.

Topic: Product Life Cycle

147. The combination of all the products a company sells is referred to as its product line.

148. Describe the potential ethical issues in the new-product development process.

149. Why are most consumers characterized as early or late majority adopters?

150. Explain the effects of the various stages of the product life cycle on product/service profitability.

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Topic: Product Life Cycle

151. A local ice cream shop has introduced a new signature treat that none of its competitors presently offer. Based on the

tenets of the product life cycle, what pricing strategies should this business use for this new treat through the various stages of

the PLC?

152. Sales and profits of the cleaning business that you own have been flat over the past two to three years. You want to offer

some new services but have been having difficulty coming up with some new ideas. What are some of the sources of new

service ideas that you can seek out?

153. A local technology firm is developing a new travel app that identifies antique shops and art galleries in the cities that you

plan to visit. How can this tech firm reduce the risks involved in developing this new travel app?

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Chapter 06 Test Bank Summary