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 primary raw material suppliers.

B. within the firm.

C. the firm's customers.

D. the firm's product distributors.

Question #2

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

A. True

B. False

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 uses subliminal ads to promote its stock product, while a firm following the marketing approach uses perceptual fluency ads to promote its stock product.

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 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.

D. 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.

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. problem solving

D. concept testing

Question #5

Focus groups refer to the form of marketing research that:

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

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

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

D. groups customer segments based on demographic factors.

Question #6

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

A. combining two products from different product categories.

B. combining two products from the same product category.

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

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

Question #7

Beta testing refers to:

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

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

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

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

Question #8

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

A. conjoint

B. electronic

C. area

D. simulated

Question #9

Forecasting is the:

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

B. application of conjoint analysis to customer data.

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

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. False

B. True

Question #11

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

A. motivational circle

B. beta product model

C. simulated market

D. product life cycle

Question #12

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

A. True

B. False

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 maturity

B. product decline

C. market introduction

D. product saturation

Question #14

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

A. False

B. True

Question #15

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

A. laggards

B. early majority

C. innovators

D. early adopters

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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