Chapter 8

Question 1

2 Ways for Companies to obtain new products

Answer 1

(1) Acquisition
(2) new product development

Question 2

New Product Development Process

Answer 2

(1) Idea Generation
(2) Idea Screening
(3) Concept Development and Testing
(4) Marketing Strategy Development
(5) Business Analysis
(6) Product Development
(7) Test Marketing
(8) Commercialization

Question 3

Idea Generation

Answer 3

Generating data from internal and external idea sources.

Question 4

Idea Screening

Answer 4

Examining the new product ideas to drop poor ones and keep few good ones.

Question 5

Concept Development & Testing

Answer 5

Developing chosen product idea into a more detailed version of itself (Production Concept)
(1) Concept Development: develop alternative versions (e.g., more affordable version with less features).
(2) Concept Testing: testing product concepts with groups of target consumers (Survey questions).

Question 6

Marketing Strategy Development

Answer 6

designing initial marketing strategy for introducing product to market after finding best concepts. 3 parts:
(1) describe target market
(2) Outline planned price, distribution and marketing budget for the first year.
(3) Describe planned long-run sales, profit goals, and marketing mix (4 Ps) strategy.

Question 7

Business Analysis

Answer 7

evaluate business attractiveness of proposal. review of sales, costs, and profit projections. find out whether they satisfy company’s objectives and if so, proceed to next step.

Question 8

Product Development

Answer 8

R&D or engineering develops product concept into physical product. Huge jump in investments. R&D develops prototype to test it out. Management must also learn what makes consumers decide that product is well built.

Question 9

Test Marketing

Answer 9

Stage at which product and its proposed marketing program are tested in realistic market settings. Costs can be very high, and this stage can take time. Firm uses simulated test markets in order to reduce costs and speed up the process.

Question 10

Commercialization

Answer 10

introducing product into the market facing high costs due to advertising, sales promotion, and other marketing efforts. must also decide on introduction timing and location(s) to launch it.

Question 11

Managing New Product Development