Chapter 7

Question 1

Which of the following is often considered the biggest source of new product ideas in business-to-business (B2B) markets? a) Employees b) Customers c) Suppliers d) Competitors

Answer 1

b) Customers

Question 2

Potential customers who are innovative and develop new applications or new products for their own use without the aid of a supplier are called: a) Early adopters b) Influencers c) Lead users d) Product champions

Answer 2

c) Lead users

Question 3

The process of obtaining product ideas, funding, and other contributions online from large numbers of people is known as: a) Networking b) Brainstorming c) Crowdsourcing d) Market research

Answer 3

c) Crowdsourcing

Question 4

What is a line extension? a) A completely new product category for a company. b) A new model or related product based on the same platform and brand as an existing product. c) A product that targets a new market segment. d) An existing product with a new marketing campaign.

Answer 4

b) A new model or related product based on the same platform and brand as an existing product.

Question 5

Which of the following is typically the least expensive step in the process of developing a new offering? a) Development b) Testing c) Idea generation d) Launch

Answer 5

c) Idea generation

Question 6

The primary purpose of idea screening is to: a) Generate as many ideas as possible. b) Avoid mistakes early in the development process by discarding bad ideas. c) Conduct detailed market research. d) Develop prototypes of new offerings.

Answer 6

b) Avoid mistakes early in the development process by discarding bad ideas.

Question 7

Presenting an idea for an offering to potential consumers for their reaction early in the development process is called: a) Product testing b) Concept testing c) Market testing d) Feasibility analysis

Answer 7

b) Concept testing

Question 8

__________ is the degree to which the company can actually make and service the product. a) Financial feasibility b) Process feasibility c) Market feasibility d) Strategic fit

Answer 8

b) Process feasibility

Question 9

When a company is assessing whether a new offering aligns with its overall goals and brand image, it is assessing its: a) Investment risk b) Opportunity risk c) Financial feasibility d) Process feasibility

Answer 9

b) Opportunity risk

Question 10

The Quality Function Deployment (QFD) process is particularly helpful for: a) Bundling the right features within a product line to meet specific customer needs. b) Determining the optimal pricing strategy for a new product. c) Selecting the most effective advertising channels. d) Streamlining the manufacturing process.

Answer 10

a) Bundling the right features within a product line to meet specific customer needs

Question 11

In the development stage of a new offering, what are the key activities? a) Generating ideas and screening them. b) Designing the actual offering, writing specifications, and developing prototypes. c) Testing the offering in a limited market. d) Introducing the offering to the full market.

Answer 11

b) Designing the actual offering, writing specifications, and developing prototypes.

Question 12

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What is the purpose of beta testing in the new product development process? a) To test the offering’s ability to meet its specifications and identify any bugs or issues with real users. b) To finalize the marketing communication plan. c) To determine the optimal price point for the product. d) To secure distribution channels.

Answer 12

a) To test the offering’s ability to meet its specifications and identify any bugs or issues with real users.

Question 13

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The introduction stage of the product life cycle is also known as: a) Growth b) Maturity c) Commercialization d) Decline

Answer 13

c) Commercialization

Question 14

What is a typical characteristic of the introduction stage of the product life cycle? a) High profits and increasing competition. b) Sales peak and then begin to decline. c) High marketing costs and often low profits. d) Decreasing competition and stable sales.

Answer 14

c) High marketing costs and often low profits

Question 15

Modifying a product by changing its packaging, size, flavors, or quality is a strategy often used to: a) Decrease production costs. b) Extend the product’s maturity stage. c) Prepare for the decline stage. d) Attract new customers in the introduction stage.

Answer 15

b) Extend the product’s maturity stage.

Question 16

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When sales of a product decrease and continue to drop to lower levels, the product has entered the: a) Maturity stage b) Growth stage c) Decline stage d) Introduction stage

Answer 16

c) Decline stage

Question 17

In the decline stage, the decision to stop investing in new products, markets, or technology and to reduce costs to maximize remaining profits is known as: a) Divesting b) Harvesting c) Repositioning d) Brand extension

Answer 17

b) Harvesting

Question 18

When a company decides to discontinue a product in the decline stage, this is known as: a) Divesting b) Harvesting c) Market penetration d) Product modification

Answer 18

a) Divesting

Question 19

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Before introducing products in global markets, an organisation must evaluate factors in the external environment, including: a) Only the economic conditions. b) Only the competitors and substitutes. c) Laws and regulations, the economy, competitors, cultural values, and market needs. d) Only cultural values and market needs.

Answer 19

c) Laws and regulations, the economy, competitors, cultural values, and market needs.

Question 20

Which of the following is a significant challenge related to managing products and may result in danger to consumers? a) Price adjustments b) Distribution channel selection c) Product recalls d) Marketing communication strategies

Answer 20

c) Product recalls

Question 21

Which of the following is described as a new model or related product based on the same platform and brand as an existing product? a) New-to-the-world product b) Line extension c) Repositioned product d) Brand extension

Answer 21

b) Line extension

Question 22

According to the text, which step is typically the least expensive in the process of developing a new offering? a) Development b) Testing c) Idea generation d) Launch or Commercialization

Answer 22

c) Idea generation

Question 23

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The primary goal of idea screening in the new offering development process is to: a) Generate as many new ideas as possible. b) Conduct thorough market research. c) Avoid mistakes early in the process by discarding poor ideas. d) Develop detailed feature specifications

Answer 23

c) Avoid mistakes early in the process by discarding poor ideas

Question 24

Presenting an idea for a new offering to potential consumers to gather their initial reactions is known as: a) Alpha testing b) Beta testing c) Concept testing d) Market testing

Answer 24

c) Concept testing

Question 25

__________ is the degree to which a company can reliably manufacture a product or consistently deliver a service to the required quality standards. a) Financial feasibility b) Process feasibility c) Strategic fit d) Market feasibility

Answer 25

b) Process feasibility

Question 26

When a company evaluates whether a potential new offering aligns with its overall mission, image, and strategy, it is assessing its: a) Investment risk b) Opportunity risk c) Financial feasibility d) Process feasibility

Answer 26

b) Opportunity risk

Question 27

The Quality Function Deployment (QFD) process begins by focusing on: a) Understanding the customer's desired benefits. b) Identifying the component parts of the offering. c) Developing prototypes of the new offering. d) Determining the pricing strategy for the new offering.

Answer 27

a) Understanding the customer's desired benefits.

Question 28

Testing a new offering in a controlled laboratory setting to ensure it meets its technical specifications is called: a) Alpha testing b) Beta testing c) Market testing d) Concept testing

Answer 28

a) Alpha testing

Question 29

Which type of testing involves providing a new offering to real customers in a less formal setting to identify any remaining issues or bugs? a) Alpha testing b) Beta testing c) Concept testing d) Market testing

Answer 29

b) Beta testing

Question 30

. A rolling launch of a new offering involves: a) Introducing the product to all markets simultaneously. b) Introducing the offering across different markets gradually. c) Launching the product with a significant promotional campaign. d) Testing the product in a limited market before a full launch.

Answer 30

b) Introducing the offering across different markets gradually

Question 31

. The first stage in the product life cycle after a product is launched is the: a) Introduction stage b) Growth stage c) Maturity stage d) Decline stage

Answer 31

a) Introduction stage

Question 32

Which of the following is a typical characteristic of the introduction stage of the product life cycle? a) High profits and increasing competition. b) Sales peak and then begin to decline. c) High marketing costs and often low profits. d) Decreasing competition and stable sales.

Answer 32

c) High marketing costs and often low profits

Question 33

Modifying a product's features, packaging, or quality is a common strategy used to: a) Increase costs in the introduction stage. b) Extend the product's maturity stage. c) Prepare for the decline stage. d) Create a new product life cycle.

Answer 33

b) Extend the product's maturity stage

Question 34

When a product's sales decline significantly and continuously, it has entered the: a) Maturity stage b) Growth stage c) Decline stage d) Introduction stage

Answer 34

c) Decline stage

Question 35

In the decline stage, the strategy of reducing costs and maximizing remaining profits without further investment is known as: a) Divesting b) Harvesting c) Repositioning d) Brand extension

Answer 35

b) Harvesting

Question 36

The decision to discontinue a product in the decline stage is referred to as: a) Divesting b) Harvesting c) Market penetration d) Product modification

Answer 36

a) Divesting

Question 37

Before introducing products into global markets, companies must assess various external environmental factors, including: a) Only economic conditions. b) Only competitors and substitutes. c) Laws and regulations, the economy, competitors, cultural values, and market needs. d) Only marketing communication strategies.

Answer 37

c) Laws and regulations, the economy, competitors, cultural values, and market needs

Question 38

A significant challenge in managing offerings that can pose risks to consumers is: a) Price adjustments. b) Distribution channel selection. c) Product recalls. d) Advertising campaigns.

Answer 38

c) Product recalls

Question 39

According to the "Copy of MKTG 1030 Notes", a succinct statement of why consumers buy your brand is a: a) Positioning statement. b) Value proposition. c) Marketing strategy. d) Target market.

Answer 39

b) Value proposition

Question 40

. In the "Copy of MKTG 1030 Notes", the idea that innovation is key is associated with which element of the marketing mix? a) Product b) Promotion c) Place d) Price

Answer 40

b) Promotion

Question 41

A small bakery is considering adding a new type of gluten-free bread to its existing product line. Which of the following would be the first step they should take in the new offering development process according to the chapter? a) Conduct a market test in a few local stores. b) Develop a detailed recipe and production process. c) Generate ideas for new gluten-free bread options. d) Screen potential ideas based on cost and feasibility.

Answer 41

. c) Generate ideas for new gluten-free bread options

Question 42

A small startup has developed a unique biodegradable packaging material. They are now looking for initial feedback on their idea from potential clients in the food industry. Which of the following would be the most suitable first step in their new offering development process? a) Conducting a full-scale market test with several food manufacturers. b) Finalising the production process and securing patents. c) Idea generation by brainstorming within the startup and potentially gathering initial reactions from a few food industry contacts. d) Immediately launching the product at a major packaging trade show.

Answer 42

c) Idea generation by brainstorming within the startup and potentially gathering initial reactions from a few food industry contacts

Question 43

"Innovators" within the VALS framework are best described as: a) Trendy and fun-loving individuals concerned with others' opinions. b) Conservative and conventional people with strong traditional beliefs. c) Successful and sophisticated individuals who are leaders and have high self-esteem. d) Practical and self-sufficient individuals who are suspicious of large institutions.

Answer 43

c) Successful and sophisticated individuals who are leaders and have high self-esteem

Question 44

. A company that manufactures high-end kitchen appliances notices a decline in sales of its older refrigerator models. Instead of completely discontinuing them, they decide to reduce marketing efforts and continue selling to a small niche market that still appreciates these models. This strategy is best described as: a) Divesting. b) Modifying. c) Harvesting. d) Rejuvenating.

Answer 44

c) Harvesting

Question 45

A multinational beverage company is planning to introduce a popular soft drink from its home country into a new market where local tastes for sweetness and carbonation levels are different. To maximise their chances of success, they should most likely consider: a) Adaptation of the product formula to better suit local preferences. b) Standardisation of the product to maintain global brand consistency. c) Launching the product without any changes and educating consumers about the original taste. d) Focusing solely on distribution without any marketing adjustments.

Answer 45

a) Adaptation of the product formula to better suit local preferences

Question 46

A marketing manager at a consumer electronics company is concerned about consistently overestimating sales forecasts for a new product line, leading to unnecessary inventory costs. To improve forecasting accuracy, they should consider: a) Relying solely on executive opinions, as they have the most experience. b) Using only past sales data for trend analysis, assuming market stability. c) Employing a blend of forecasting methods, including customer surveys, sales force estimates, and considering various market scenarios. d) Decreasing the frequency of forecasting to reduce workload.

Answer 46

c) Employing a blend of forecasting methods, including customer surveys, sales force estimates, and considering various market scenarios

Question 47

A business-to-business (B2B) software company is preparing to launch a new version of its flagship product. They want to get feedback on its usability and identify any potential bugs before the official release. The most appropriate type of testing to conduct at this stage would be: a) Alpha testing in their internal lab. b) Concept testing with potential clients. c) Beta testing with a select group of existing customers in their real-world work environments. d) A broad market test across various industries.

Answer 47

c) Beta testing with a select group of existing customers in their real-world work environments

Question 48

A well-established clothing brand decides to extend its product line by introducing a new range of home textiles (e.g., bedding, towels) using the same brand name and logo. This is an example of: a) Line depth. b) Line breadth. c) Brand extension. d) Product mix expansion

Answer 48

c) Brand extension

Question 49

A company is trying to understand why a recent promotional campaign for its energy drink resulted in a significant increase in sales. To isolate the impact of the campaign from other factors like seasonal changes or competitor activities, they would ideally want to employ: a) Managerial control by strictly dictating campaign implementation. b) Statistical control to mathematically remove the influence of other variables on sales data. c) Conducting a marketing audit after the campaign to assess overall performance. d) Simply observing sales figures before and after the campaign

Answer 49

b) Statistical control to mathematically remove the influence of other variables on sales data

Question 50

During the introduction stage of the product life cycle, which pricing strategy is often employed to recover high initial research and development costs and target early adopters willing to pay a premium? a) Penetration pricing. b) Competitive pricing. c) Skimming pricing. d) Cost-plus pricing.

Answer 50

c) Skimming pricing

Question 51

A consumer is looking to buy a new smartphone. They spend considerable time researching different brands, comparing features, reading reviews, and considering their budget. This type of buying decision is best described as: a) Routine response behaviour. b) Impulse buying. c) Limited problem solving. d) High-involvement decision

Answer 51

d) High-involvement decision

Question 52

In a SWOT analysis, which of the following would be classified as an external opportunity for a company? a) A strong brand reputation and loyal customer base. b) Inefficient production processes leading to higher costs. c) Emerging consumer trends indicating a growing demand for the company's type of product. d) Increased competition from new entrants in the market

Answer 52

c) Emerging consumer trends indicating a growing demand for the company's type of product

Question 53

When conducting marketing research to understand consumer preferences for a new snack product, a researcher uses a focus group discussion to gather in-depth opinions and feelings. This type of research primarily generates: a) Quantitative data that can be statistically analysed. b) Qualitative data providing rich insights into consumer attitudes and behaviours. c) Scanner-based data from retail purchases. d) Syndicated research data collected by other firms.

Answer 53

b) Qualitative data providing rich insights into consumer attitudes and behaviours

Question 54

. A company's value proposition is best described as: a) A detailed description of the product's features and benefits. b) The monetary amount charged for the product. c) A concise statement of why consumers should choose their brand over competitors and the benefits they will receive. d) How the company positions its product relative to others in the marketplace.

Answer 54

c) A concise statement of why consumers should choose their brand over competitors and the benefits they will receive

Question 55

. According to the RATER model for service quality, empathy refers to: a) The ability to perform the promised service dependably and accurately. b) The knowledge and courtesy of employees and their ability to convey trust and confidence. c) The caring, individualised attention provided to customers. d) The appearance of physical facilities, equipment, personnel, and communication materials.

Answer 55

c) The caring, individualised attention provided to customers

Question 56

A company uses geodemographics as a segmentation base. This means they are dividing their market based on: a) Consumer lifestyles, attitudes, and values. b) Age, gender, income, and ethnicity. c) Benefits sought by consumers and their usage rate. d) A combination of geographic location and demographic characteristics.

Answer 56

d) A combination of geographic location and demographic characteristics

Question 57

In the context of B2B marketing, a Request for Proposal (RFP) is typically used during which stage of the buying process? a) Need recognition. b) Need description and quantification. c) Potential suppliers are searched for. d) Qualified suppliers are asked to complete responses.

Answer 57

d) Qualified suppliers are asked to complete responses.

Question 58

. A company is launching a new software product with a "rolling launch" strategy. This means they will: a) Release all features of the product at once across all markets. b) Offer the product at a very low introductory price for a limited time. c) Introduce the product market by market over time. d) Primarily rely on online channels for distribution.

Answer 58

c) Introduce the product market by market over time

Question 59

When a firm conducts a competitive analysis, its primary focus is typically on: a) Understanding broad macroeconomic trends. b) Evaluating the bargaining power of suppliers and buyers. c) Assessing potential new entrants to the market. d) Direct competitors and their strengths, weaknesses, image, and resources

Answer 59

d) Direct competitors and their strengths, weaknesses, image, and resources.

Question 60

Cannibalization in the context of product lines occurs when: a) A competitor introduces a very similar product at a lower price. b) Consumer demand for a product category significantly declines. c) A company's new offering reduces the sales of its existing offerings. d) Counterfeit versions of a popular brand enter the market.

Answer 60

c) A company's new offering reduces the sales of its existing offerings

Question 61

The primary goal of idea screening in the new offering development process is to: a) Generate a large number of diverse product ideas. b) Develop detailed technical specifications for promising ideas. c) Identify and eliminate unfeasible or poor product ideas early in the process. d) Test the market viability of all generated product ideas

Answer 61

c) Identify and eliminate unfeasible or poor product ideas early in the process