University of the Potomac » Business » Business 530 - Marketing Management » Winter 2023

Business 530 - Marketing Management » Winter 2023 » Chapter 08 New Products and Innovation

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Question #1

In the context of product development, a top-down approach is also called an inside-out approach because the idea comes from:

A. the firm's product distributors.

B. within the firm.

C. the primary raw material suppliers.

D. the firm's customers.

Question #2

When caused by demographic trends, transformations in markets and customer demands for new products are unpredictable.

A. False

B. True

Question #3

With reference to new product development, which of the following statements is true regarding the difference between the top-down approach and the marketing approach that is followed by firms?

A. A firm following the top-down approach asks for customers' feedback at the end of a process, while a firm following the marketing approach asks for customers' feedback at most phases in a process.

B. A firm following the top-down approach deals with brand extensions, while a firm following the marketing approach deals with product line extensions.

C. A firm following the top-down approach uses subliminal ads to promote its stock product, while a firm following the marketing approach uses perceptual fluency ads to promote its stock product.

D. A firm following the top-down approach relates to the macro-environmental factors of the firm, while a firm following the marketing approach relates to the micro-environmental factors of the firm.

Question #4

In the _____ stage of the new product development process, the company tries to get customers' feedback on the most promising idea from its pool of selected ideas

A. brainstorming

B. refining

C. concept testing

D. problem solving

Question #5

Focus groups refer to the form of marketing research that:

A. uses quantitative techniques to collect the primary data for new product development.

B. asks a group of people to describe the use of a product in a specific category.

C. groups customer segments based on demographic factors.

D. groups customer segments into a separate niche market segment.

Question #6

With reference to a focus group, conjoint analysis refers to:

A. combining two product attributes to form a single product attribute.

B. combining two products from different product categories.

C. combining two products from the same product category.

D. combining two customer segments to form a new customer segment.

Question #7

Beta testing refers to:

A. creating the physical prototype of a product, and testing it under typical usage conditions.

B. building a product with minimal features, and testing it on the internal shareholders of a firm.

C. estimating the profitability and break-even point of a product idea using statistical tools.

D. launching a product and estimating the sales volume of the same product.

Question #8

A virtual grocery store aisle is an example of the _____ type of test market.

A. conjoint

B. electronic

C. simulated

D. area

Question #9

Forecasting is the:

A. prediction of a product's likely success using customer data.

B. factor used to distinguish between two different core product attributes.

C. application of conjoint analysis to customer data.

D. factor that distinguishes external test markets from internal test markets.

Question #10

In the context of a mature consumer packaged goods company, new product development moves at a rapid pace for straightforward brand extensions.

A. True

B. False

Question #11

A _____ is used in marketing to describe the evolution and duration of a product in the market.

A. motivational circle

B. simulated market

C. beta product model

D. product life cycle

Question #12

In the product life cycle, price skimming takes place at the market growth stage.

A. False

B. True

Question #13

Customer awareness of a product in the market growth stage is greater than the customer awareness of the same product in the _____ stage.

A. market introduction

B. market maturity

C. product saturation

D. product decline

Question #14

In the market maturity stage of the product life cycle, products proliferate to a fuller product line.

A. True

B. False

Question #15

With respect to diffusion of innovation, customers from the "_____" group are more risk averse than customers from the "late majority" group.

A. innovators

B. early adopters

C. early majority

D. laggards

Question #16

Different stages in the life cycle require different investments, for example, periods of growth need cash, while periods of slower growth might generate cash to be reinvested to maintain share.

A. False

B. True

Question #17

Beyond simple demographics, numerous lifestyle trends should be salient when companies are considering new directions.

A. True

B. False

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