Question 1

Although innovation strategies may not work in the long run,overriding short-term reasons compel firms to introduce new products and services.

Accepted Answer

The answer of Although innovation strategies may not work in...

Question 2

Tina had been watching cable TV even though 50 percent of the country had moved to satellite TV.Though she was aware of the benefits of satellite television,she did not make the move to adopt the new technology until after her friend explained that Tina could receive good benefits at low costs.According to the diffusion of innovation model,to which of the following groups of buyers does Tina belong?
A) Early majority
B) Early adopters
C) Laggards
D) Innovators
E) Late majority

Accepted Answer

Tina belongs to the "Late majority" group of buyers in the diffusion of innovation model. This group of buyers adopts a new technology only after it has been established as the norm and after receiving recommendations from others. Tina was hesitant to switch to satellite TV until her friend explained the benefits, which indicates that she was not an early adopter or an innovator, and she was not resistant to change like laggards.

Question 3

When Glenn asked a few of his regular customers to test his prototype surfboard,he was engaging in alpha testing.

Accepted Answer

The answer of When Glenn asked a few of his...

Question 4

Lead users are those buyers who want to be the first to have a new product or service.

Accepted Answer

The answer of Lead users are those buyers who want...

Question 5

Innovators are often regarded as the opinion leaders for particular product categories.

Accepted Answer

The answer of Innovators are often regarded as the opinion...

Question 6

If a firm is facing intense competition on the prices of its product and in turn it is leading to a decrease in the firm's profit margins,then the product is said to be in which stage of its life cycle?
A) Decline
B) Introduction
C) Maturity
D) Growth
E) Deterioration

Accepted Answer

A decrease in profit margins due to intense price competition indicates that the product is in the maturity stage of its life cycle where market saturation is high and competition is intense. In the introduction stage, the product is new and enjoys limited competition, while in the growth stage, the product is seeing increasing demand and rising profits. The decline stage is characterized by a decrease in demand and sales. Deterioration is not a recognized stage in the product life cycle.

Question 7

A graph representing the product life cycle 
-The stage in a product life cycle in which innovators are the main consumers is called the:
A) innovation stage.
B) maturity stage.
C) growth stage.
D) introduction stage.
E) decline stage.

Accepted Answer

The introduction stage is the stage in the product life cycle when the product is first introduced to the market, and innovators are the primary consumers who are willing to try out new products. During this stage, sales are usually low, and the company incurs high costs associated with product development and marketing.

Question 8

A graph representing the consumer adoption cycle 
-George is curious about a new tablet that will be released in the market in the next few days.Although he owns a similar product from a rival company,he is interested in the additional features that the new product offers and decides to buy it.To which of the following categories of buyers does George belong?
A) Early Adopters
B) Early majority buyers
C) Late majority buyers
D) Innovators
E) Laggards

Accepted Answer

The answer of A graph representing the consumer adoption cycle...

Question 9

Nancy is a professional photographer and has been looking to buy a new digital camera that improves picture quality.After extensive research about a new camera that was released in the market two weeks ago,she decides to buy it because she is convinced that it will produce the picture quality she has been looking for.This shows that Nancy belongs to the group of:
A) late majority buyers.
B) early adopters.
C) innovators.
D) early majority buyers.
E) laggards.

Accepted Answer

Nancy has done extensive research and is willing to try out new technology to improve her work. This behavior is characteristic of early adopters who are the first ones to try out new products and services that they believe will give them a competitive advantage. The product being released only two weeks ago further supports this choice.

Question 10

Firms can create and deliver value more effectively by adding new products to their offerings to keep customers from getting bored with the current product or service offering.

Accepted Answer

By adding new products, firms can attract new customers and retain existing ones, as customers tend to get bored with the same product or service offering over time. This helps in creating and delivering value more effectively.

Question 11

Innovators are crucial to the success of a new product because they help the product gain market acceptance.

Accepted Answer

Innovators are the first group of consumers to try out a new product and provide feedback. Their early adoption and positive reviews can influence early market acceptance of the product by early adopters, early majority, and eventually the majority of consumers.

Question 12

Disruptive products require a higher level of learning from consumers.

Accepted Answer

Disruptive products usually introduce a new concept or technology that consumers are not familiar with. Therefore, consumers need to learn and adapt to the new product, which requires a higher level of learning.

Question 13

Firms with single products are better able to withstand external shocks,including changes in consumer preferences or intensive competitive activity.

Accepted Answer

Firms with single products are more vulnerable to external shocks because any negative impact on that product can have a significant impact on the entire company. Diversification is often seen as a way to mitigate this risk, as it allows a company to spread its risk across multiple products or markets.

Question 14

Based on the graph,which of the following stages in a product's life cycle is characterized by increasing competitors and a rapid rise in industrial sales?
A) Maturity stage
B) Growth stage
C) Introduction stage
D) Domination stage
E) Decline stage

Accepted Answer

The graph indicates a rapid rise in sales during the growth stage and also shows increasing competitors. The other stages such as introduction, maturity, domination, and decline do not necessarily have a rapid rise in sales and increasing competitors.

Question 15

Who among the following can be regarded as a laggard according to the diffusion of innovation theory?
A) Natalie,who buys products after carefully reviewing the benefits of these products
B) Albert,who is tech savvy and owns most of the new gadgets released in the market
C) Emily,who still listens to songs on cassette tapes despite the advent of CDs and MP3s
D) Harris,who buys products after a few months of their release to obtain discounts on the products owing to competition in the market
E) Taylor,who buys products because the majority of his friends already own them

Accepted Answer

According to the diffusion of innovation theory, a laggard is someone who is slow to adopt new technologies or innovations, and may even resist them altogether. Emily's continued use of cassette tapes despite the availability of newer technology aligns with this definition.

Question 16

Dean McShane is the chief technology officer of a company that offers online education.Dean is interested in buying a new 3D technology product but decides to wait until two versions of the product are released to be sure of its maturity.According to the diffusion of innovation model,to which of the following groups of buyers does Dean belong?
A) Early majority
B) Late majority
C) Laggards
D) Innovators
E) Early adopters

Accepted Answer

Dean belongs to the Early Majority group because he prefers to wait until a product has been proven and adopted by some, indicating a more cautious approach typical of the early majority, who adopt new technology before the average person but after the innovators and early adopters.

Question 17

Compatibility is important for rapid diffusion of new products because products that are consistent with consumers' past behaviour will be more readily accepted.

Accepted Answer

When new products are compatible with consumers' past behaviour, they are more likely to be perceived as familiar and easier to adopt, leading to a faster and more successful diffusion. In contrast, products that require significant changes in consumers' habits or values may face more resistance and take longer to be accepted.

Question 18

Which of the following statements is correct about the test marketing carried out by Mirka Beauty Products?
A) It avoids promotions such as the use of coupons.
B) It uses all the elements of the marketing mix.
C) It costs less and takes much less time than premarket tests.
D) The product appears in all the retail outlets of a country with reduced pricing.
E) A firm cannot estimate demand for the entire market based on a test marketing.

Accepted Answer

Test marketing involves using all the elements of the marketing mix to introduce a product in a limited market to evaluate its success before launching it nationally. Option A is incorrect because test marketing can involve promotions such as the use of coupons. Option C is incorrect because premarket tests are different from test marketing in terms of the scope and objective. Option D is incorrect because test marketing is typically done in a limited market, not all retail outlets of a country. Option E is incorrect because firms can estimate demand for the entire market based on test marketing, although it may not be as precise as a national launch.

Question 19

LuxSpeed Inc.is a car manufacturing firm.It is experiencing a decline in the sales of a model released in the 1990s.At this stage,LuxSpeed Inc.should focus all its marketing efforts toward:
A) producing new variations of the model.
B) increasing the number of users and the frequency of use for the model.
C) developing new uses for the model.
D) altering the appearance of the model.
E) targeting a particular segment of brand loyalists interested in the model.

Accepted Answer

Since the model is from the 1990s, it is unlikely that LuxSpeed Inc. can produce new variations of the model or alter its appearance. Similarly, developing new uses for the model may not be practical. Instead, LuxSpeed Inc. should focus on targeting a particular segment of brand loyalists who are interested in the model. By increasing its marketing efforts toward this segment, LuxSpeed Inc. may be able to boost sales and retain its current customer base.

Question 20

Lead users customize a firm's products; studying lead users helps the firm understand general market trends.

Accepted Answer

Lead users are typically early adopters who have unique needs and preferences that are not yet met by existing products in the market. By studying and collaborating with lead users, firms can create customized solutions that meet these unique needs, and can also gain insights into emerging market trends that may influence product development strategies in the future.

Quiz 8: Segmentation, Targeting, and Positioning

Although innovation strategies may not work in the long run,overriding short-term reasons compel firms to introduce new products and services.

When Glenn asked a few of his regular customers to test his prototype surfboard,he was engaging in alpha testing.

Lead users are those buyers who want to be the first to have a new product or service.

Innovators are often regarded as the opinion leaders for particular product categories.

If a firm is facing intense competition on the prices of its product and in turn it is leading to a decrease in the firm's profit margins,then the product is said to be in which stage of its life cycle?

A graph representing the product life cycle -The stage in a product life cycle in which innovators are the main consumers is called the:

Firms can create and deliver value more effectively by adding new products to their offerings to keep customers from getting bored with the current product or service offering.

Innovators are crucial to the success of a new product because they help the product gain market acceptance.

Disruptive products require a higher level of learning from consumers.

Firms with single products are better able to withstand external shocks,including changes in consumer preferences or intensive competitive activity.

Based on the graph,which of the following stages in a product's life cycle is characterized by increasing competitors and a rapid rise in industrial sales?

Who among the following can be regarded as a laggard according to the diffusion of innovation theory?

Compatibility is important for rapid diffusion of new products because products that are consistent with consumers' past behaviour will be more readily accepted.

Which of the following statements is correct about the test marketing carried out by Mirka Beauty Products?

LuxSpeed Inc.is a car manufacturing firm.It is experiencing a decline in the sales of a model released in the 1990s.At this stage,LuxSpeed Inc.should focus all its marketing efforts toward:

Lead users customize a firm's products; studying lead users helps the firm understand general market trends.