Deck 7: Concept Evaluation and Testing

Question 1

With reference to the risk/payoff matrix, a "drop error" occurs when a product, that is likely to fail if marketed, is continued.

Answer 1

False

Question 2

Prototypes are the least expensive form of concept statements because very few decisions have to be made about the new product to get it into a prototype.

Answer 2

False

Question 3

Virtual reality captures the advantages and all the disadvantages of a prototype.

Answer 3

False

Question 4

A firm that develops a contingency plan prior to launching a new product is adopting an active acceptance risk strategy.

Question 5

If a firm makes products with very long cycle times, it is required to control the number of products it has in the process queue at any given time so that products receive development funds in a timely manner.

Question 6

A-T-A-R is a term that came from consumer products marketing.

Question 7

A-T-A-R is a term that came from consumer products marketing.

Question 8

Concept testing is different from concept development as it undermines the idea of helping an item and kills it off.

Question 9

Surrogate questions help when the timing of factual information does not often match one's need for it.

Question 10

The A-T-A-R concept is based on the diffusion of risk model.

Question 11

The evaluation process begins with the creation of a prototype.

Question 12

The product innovation charter (PIC) directing new product development eliminates more product ideas than all the other evaluations combined.

Question 13

A complete new product concept is a statement about anticipated product features that will yield problem solutions relative to other products already available.

Question 14

The perceptual map analysis leads to the idea of a decay curve.

Question 15

The earliest evaluation that a firm makes is of itself and its situation, which yields a priori conclusions about new product proposals.

Question 16

A "go error" and a "drop error" have the same cost and probability dimensions.

Question 17

The first purpose of a concept test is to generate the sales or trial rate that a product would enjoy.

Question 18

The late expenditures curve is representative of product development in technical fields such as optics.

Question 19

Concept testing can be used for developing an idea, not just for testing it.

Question 20

In new product work, financial analysis should be done by firms as early as possible to avoid wasting money on poor projects.

Question 21

When benefit segments are overlaid onto a perceptual map, it results in a cumulative expenditures curve.

Question 22

The use of subcontractors or joint ventures is most likely to be closely associated with the _____ risk strategy.

A) mitigation
B) avoidance
C) acceptance
D) transfer

Question 23

Which of the following outcomes of a risk/payoff matrix, used for evaluating a new product process, is most likely to be the costliest for a firm?

A) Stopping a product that is likely to fail
B) Continuing a product that is likely to fail
C) Stopping a product that is likely to succeed
D) Continuing a product that is likely to succeed

Question 24

During the concept generation phase of the basic new products process, the goal of product evaluation is to:

A) chart out the PIC.
B) cull out the big/sure losers.
C) conduct protocol checks and prototype tests.
D) speculate sale in retrospect.

Question 25

The first use of evaluation is focused upon:

A) the development of a marketing plan.
B) the likely success of the product concept that has been selected for development.
C) mistakes made during the launch of the new product.
D) providing direction for the selection of potential product concepts.

Question 26

The evaluation issue during the launch phase in the new product development process that seeks to find out if a firm has proven itself able to make and market an item on a commercial scale is usually carried out by the evaluation task called _____.

A) market testing
B) prototype development
C) market capitalization
D) market segmentation

Question 27

With reference to the purpose of evaluation, which of the following questions that a firm asks, tests the aspect of scalability of assessing ideas in the concept generation phase of the basic new products process?

A) Does it meet a specific customer need?
B) Does the firm have the capability to develop and launch the idea?
C) Can the firm become more efficient in production as volume increases?
D) Is there a good match corporate strategy and culture?

Question 28

Which of the following actions causes backtracking?

A) When the product development process is carried out step by step
B) When the costs of incomplete product development are higher than the costs of delayed introduction
C) When an idea or concept cannot be implemented until after a prototype has been created
D) When the steps in the product development process are skipped

Question 29

Which of the following statements is true of the cumulative expenditure curve?

A) The early expenditures curve initially slopes downward and then starts sloping upward.
B) The late expenditures curve is representative of product development in technical fields such as optics.
C) The late expenditures curve initially slopes upward and then starts sloping downward.
D) The early expenditures curve is representative of product development in technical fields.

Question 30

If the number of determinant attributes is very less, identifying benefit segments on an importance map can be very complex.

Question 31

In which of the following risk strategies is risk reduced to an acceptable, threshold level, perhaps through redesigning a product to include more backup systems or increasing product reliability?

A) Mitigation
B) Avoidance
C) Passive acceptance
D) Transfer

Question 32

The primary purpose of evaluation during Phase III of the basic new products process is to:

A) develop a marketing plan.
B) create a final, full-scale prototype.
C) identify concepts that will proceed further in the development process.
D) eliminate all probable mistakes in the launch phase.

Question 33

A new product appears first as a(n) _____.

A) prototype
B) idea
C) model
D) code

Question 34

The very first evaluation in the product development process usually:

A) occurs after a product idea has been developed.
B) precedes the product concept.
C) follows the development of a prototype.
D) follows the product launch.

Question 35

Which of the following risk strategies typically involves developing a contingency plan to accompany new product development?

A) Passive avoidance
B) Active acceptance
C) Mitigation
D) Transfer

Question 36

Benefit segmentation is used to identify unsatisfied market segments and concentrate a firm's efforts on developing concepts ideally suited to the needs of those segments.

Question 37

Which of the following risk strategies is most likely to incur opportunity costs?

A) Avoidance
B) Mitigation
C) Transfer
D) Acceptance

Question 38

A _____ is an evaluation technique that tells one whether he or she is ready to develop a product for serious field testing.

A) speculative sale
B) protocol check
C) scoring model
D) full screen test

Question 39

Which of the following industries is most likely to be represented by a late expenditures curve?

A) Consumer packaged goods
B) Pharmaceuticals
C) Optics
D) Computers

Question 40

According to the risk/payoff matrix, during the phase of concept/project evaluation of the new products process, a _____ error occurs when a winning product is discarded.

A) drop
B) decay
C) launch
D) development

Question 41

Which of the following statements is true regarding the people dimension of the evaluation system?

A) It is difficult to kill an idea in the early stage of product development as most of the people are yet to evaluate the idea.
B) Late in the product development cycle, hurdles are usually easy to wave aside.
C) Early in the life of a new product, the product idea may have little support outside of R&D.
D) Late in the product development cycle, fewer people are likely to support the product idea.

Question 42

Which of the following statements is true of a new product development project that is evaluated with the help of rolling evaluation?

A) The project is assessed at predefined intervals.
B) This evaluation generally leads to the premature closure of a project.
C) Everything in the project is keyed to a single Go/No Go decision.
D) Participants avoid mindsets of good and bad about the project.

Question 43

Concept testing will work best for:

A) concepts related to consumer packaged goods.
B) concepts embodying new art and entertainment.
C) concepts embodying some new technology that users cannot visualize.
D) concepts related to a product whose prime benefit is a personal sense.

Question 44

Concept testing is a part of the _____ process.

A) development
B) prescreening
C) launch
D) full screening

Question 45

In the context of the A-T-A-R model, _____ means someone in the buying unit hears about the existence of a new product with some characteristic that differentiates it.

A) repeat
B) available
C) aware
D) trial

Question 46

Concept testing was essentially invented by ____.

A) industrial firms
B) wholesalers
C) retailers
D) advertising firms

Question 47

Which of the following is true of a decay curve?

A) It is primarily a plan rather than a result.
B) It depicts the entire life cycle of product.
C) Decisions on the risk matrix lead to the idea of a decay curve.
D) Synchronization of the two aspects in a decay curve, plan and result, reduces its value as a managerial concept.

Question 48

Which of the following is true of the product innovation charter (PIC) of a firm?

A) The PIC is formulated at the end of the new products process.
B) The formulation of the PIC follows the phase of opportunity identification and concept generation.
C) The PIC precludes the practice of having unwanted proposals eat up valuable development funds before they are detected.
D) The PIC tends to eliminate less product ideas than any of the other evaluation techniques.

Question 49

The farther a new product idea is allowed to proceed through the development process:

A) lesser the number of people who believe in the concept.
B) the tougher it is to stop the product.
C) the easier it is to wave aside the hurdles.
D) the lesser support it receives from R&D workers.

Question 50

While preparing the product innovation charter (PIC), the earliest evaluation that a firm makes is of ____.

A) its competitors
B) the legal requirements it has to fulfill
C) the technologies used by its competitors
D) itself and its situation

Question 51

If it is simple to go from concept to full service description, then the services firm can proceed to:

A) developing the product innovation charter.
B) developing a concept statement.
C) prototype concept testing.
D) analyzing competitors' offerings.

Question 52

A product concept is a:

A) finalized result of core competency.
B) product feature.
C) physical prototype.
D) claim of proposed value to customers.

Question 53

Concept testing is sometimes called concept _____ to reinforce the idea of helping the item, not just killing it off.

A) checking
B) development
C) validation
D) evaluation

Question 54

A rolling evaluation means that a project is being assessed continuously, which implies that it is dealing with risk via _____.

A) avoidance or transfer
B) acceptance or avoidance
C) acceptance or mitigation
D) mitigation or avoidance

Question 55

Which of the following statements about the new product evaluation process is untrue?

A) The assumption that a product development plan is mostly tentative.
B) Form and positioning can usually be changed during the process.
C) Everything in new product work should be keyed to a Go/No Go decision.
D) Customer attitudes usually tend to change along the entire process.

Question 56

Which of the following statements is true of surrogate questions?

A) Typically they remain constant at different times in the evaluation process.
B) They are less useful when one wants to gauge customer reactions early on, even before the product is developed.
C) They are based on the fact that the timing of factual information often matches a product developer's need for it.
D) Their response has little value except to help answer a critical question that cannot be answered directly.

Question 57

In the context of the A-T-A-R model, _____ means the percentage chance that if a buyer wants to try a product, the effort to find it will be successful.

A) repeat
B) aware
C) available
D) trial

Question 58

VSFS Software Solutions Inc. is aware that its newly launched app is prone to certain risks and creates a contingency plan to counter the risk. Which generic risk strategy is the company adopting in this scenario?

A) Passive acceptance
B) Active acceptance
C) Avoidance
D) Transfer

Question 59

In the case of the A-T-A-R model, R stands for _____.

A) rate
B) response
C) repeat
D) region

Question 60

The A-T-A-R concept is taken from _____.

A) the risk/payoff matrix
B) diffusion of innovation
C) the delay curve
D) the cumulative expense curve

Question 61

Practitioners urge that a concept statement should:

A) not claim determinant attributes.
B) always be presented to potential buyers in a verbal format.
C) be as descriptive and lengthy as possible.
D) relate in some way to things familiar to the customer.

Question 62

Which of the following formats of concept testing produces more realistic evaluations but also risks the bias of good or poor advertising copy writing?

A) Narrative format
B) Stripped description
C) Commercialized format
D) Virtual reality

Question 63

Which of the following has to be usually supplemented by a narrative statement of the concept in a concept statement?

A) Prototypes
B) Drawings
C) Virtual reality images
D) Models

Question 64

Conjoint analysis is used to identify _____.

A) survey variations
B) the optimum combination of attributes
C) high-potential gaps
D) the optimum price for a product

Question 65

Track Inc. seeks to identify unsatisfied market segments in the health care insurance segment. It wants to concentrate its efforts on developing concepts ideally suited to the needs of these segments. For this purpose, the firm is most likely to employ _____.

A) benefit segmentation
B) a risk or payoff matrix
C) calibrated heuristics
D) promotion segmentation

Question 66

According to the classic five-point question format of the concept test for a product, the top-two-boxes score includes the number of people who:

A) definitely would buy the product or probably would buy the product.
B) probably would buy the product or might or might not buy the product.
C) might or might not buy the product or probably would not buy the product.
D) probably would buy the product or definitely would not buy the product.

Question 67

A commercialized concept statement:

A) sounds more like how a product would actually be promoted or advertised to customers.
B) does not produce realistic customer evaluations.
C) is also known as a "stripped description."
D) just presents facts in the form of bullet points.

Question 68

Which of the following adopter groups are the most important for concept testing of new products and, probably, market acceptance?

A) Early majority and late majority
B) Early majority and laggards
C) Innovators and early adopters
D) Innovators and laggards

Question 69

Once a concept passes the first hurdle, concept testing will focus next on:

A) estimating the product's sales or trial rate.
B) calculating production costs.
C) approximating materials costs.
D) prototyping the product.

Question 70

Which of the following is an immediate and critical question in concept testing that should be answered prior to all other questions?

A) How likely is it that the respondents would buy the product?
B) How much do the respondents like the concept?
C) Does the respondent understand the concept?
D) What are the respondents' reactions to price?

Question 71

A concept statement developed during the new product development process:

A) describes the technology to be used for manufacturing the product.
B) discusses the results of prototype testing.
C) states a difference and how that difference benefits the customer.
D) lists the guidelines for developing the new product.

Question 72

In the context of the issues in the response situation in concept evaluation, _____ are particularly useful when we want respondents to hear and react to the comments of others and to talk about how the product would be used.

A) direct individual interviews
B) anonymous surveys
C) focus groups
D) individual judgment tests

Question 73

The first purpose of concept testing is to:

A) estimate the likely sales or trial rate.
B) identify very poor concepts for early elimination.
C) refine revenue estimates claimed by marketers.
D) identify the technology needed for development.

Question 74

What are the important reasons for new product failure?

Question 75

In the context of concept statements, a(n) _____ description presents just the facts (this can even be in bullet points), whereas a(n) _____ description sounds more like how the product would actually be promoted or advertised to customers.

A) noncommercialized; stripped
B) embellished; stripped
C) stripped; embellished
D) commercialized; embellished

Question 76

The benefit segments overlaid onto a perceptual map result in a ____, which allows assessment of the preferences of each benefit segment for different product concepts.

A) cumulative expenditures curve
B) risk or payoff matrix
C) joint space map
D) decay curve

Question 77

_____ can be used to model existing brand preferences and predict likely preferences for new concepts.

A) Attribute ratings
B) Drop curves
C) Importance ratings
D) Decay curves

Question 78

According to the classic five-point question format for purchase intentions, which of the following is true of the top-two-boxes score?

A) This score represents the number or percentage of people who definitely would not buy a product.
B) This score is used as an indicator of group reaction.
C) Researchers who calibrate this score believe that it reflects real figures.
D) This score is used to indicate the number or percentage of people who might or might not buy a product.

Question 79

Which of the following is the largest supplier of concept tests?

A) The AE federation
B) The BASES group
C) The AMA group
D) The APA association

Question 80

Which of the following is true of conjoint analysis in concept testing?

A) Conjoint analysis cannot feasibly test attributes and levels using a reduced set of cards.
B) Conjoint analysis ranks the possible combinations of attributes from the least preferred to the most preferred.
C) Conjoint analysis cannot be used to identify those concepts that are the "real losers," which should not be considered for further development.
D) Conjoint analysis is extremely useful in concept testing because of its ability to uncover relationships between attributes and customer preferences.