Deck 8: Segmentation, Targeting, and Positioning

Question 1

The group of buyers that enters a new product market when a product has achieved its full market potential are referred to as:

A) early adopters.
B) innovators.
C) laggards.
D) late majority.
E) early majority.

Answer 1

D

Question 2

The group of buyers that acts as opinion leaders and is responsible for bringing the early majority,late majority,and laggard groups into a market is the:

A) innovators.
B) lead users.
C) pioneers.
D) laggards.
E) early adopters.

Answer 2

E

Question 3

Brenda wanted to buy an LCD TV when it was released but decided to wait for more options and better quality.She bought it at a later stage when companies reduced the prices of LCD TVs due to growing competition in the market.To which of the following groups of buyers does Brenda belong?

A) Innovators
B) Laggards
C) Late majority
D) Early majority
E) Early adopters

Answer 3

D

Question 4

Which of the following groups of the consumer adoption cycle is characterized by buyers who enjoy taking risks,are regarded as knowledgeable,and are not price sensitive?

A) Laggards
B) Innovators
C) Early adopters
D) Early majority
E) Late majority

Question 5

Early adopters differ from innovators in that early adopters:

A) help a product gain market acceptance by spreading positive word-of-mouth.
B) enjoy taking risks and are not price sensitive.
C) want to be the first on the block to have a new product or service.
D) decide whether a product is worth the cost only after careful review.
E) are regarded as highly knowledgeable as they keep themselves well informed about different product categories.

Question 6

Which of the following is an advantage for product pioneers in new product introductions?

A) They make high profits as soon as they enter a market.
B) They become readily recognizable to consumers.
C) They have to share a market with very few competitors that have monopoly power.
D) They always succeed in a marketplace because of lack of competition.
E) They need not focus on creating demand for a product category.

Question 7

Innovators are crucial to the success of any new product or service because:

A) they prefer products from established market leaders.
B) they are easily influenced by advertising.
C) they help the product or service gain market acceptance.
D) they are considered opinion leaders and influence other majority groups.
E) they form a major group of consumers in the market of a new product or service.

Question 8

Personal music players that were initially released in the market were expensive and huge,and provided limited options.Anna and her husband did not buy them at that time and waited for more selection.When they finally bought the product,the sales had levelled off and the size and prices had reduced significantly.To which of the following groups of buyers do Anna and her husband belong?

A) Innovators
B) Laggards
C) Late majority
D) Early majority
E) Early adopters

Question 9

The process by which ideas are transformed into new products and services that help firms grow is known as:

A) prototyping.
B) innovation.
C) diffusion.
D) adoption.
E) brainstorming.

Question 10

The category of buyers that tends to enjoy novelty and is regarded as opinion leaders for particular product categories and spreads the word are called:

A) early adopters.
B) early majority.
C) late majority.
D) innovators.
E) laggards.

Question 11

Firms that invest in the latest technology,either to use in their new products or services or to make the firm more efficient,are considered:

A) first movers.
B) innovators.
C) lead users.
D) laggards.
E) early adopters.

Question 12

Natalie is a stockbroker who is comfortable using her old phone,which does a little more than making calls and sending and receiving text messages.Though her work requires her to be updated about the stock market throughout the day,she decides to wait for the smartphone market to mature and for the prices to decrease.She decides to invest in a smartphone only after being convinced that the price is just right for her budget.From this scenario,we can say that Natalie belongs to the group of buyers called:

A) innovators.
B) laggards.
C) lead users.
D) early adopters.
E) late majority.

Question 13

Eric is enthusiastic about online video games.He has extensive knowledge of technical aspects of developing games and usually purchases licensed versions of most games as soon as they are launched.According to the diffusion of innovation model,to which of the following groups of buyers does Eric belong?

A) Early adopters
B) Early majority
C) Lead users
D) Innovators
E) Late majority

Question 14

According to the diffusion of innovation theory,buyers belonging to the early majority group are considered crucial because:

A) they act as opinion leaders and spread the word to the next groups entering a market.
B) they are regarded as highly knowledgeable and are not price sensitive.
C) they affect the profitability of new products and services.
D) they avoid change and rely on traditional products until they are no longer available.
E) they enter a new product market when the product has achieved its full market potential.

Question 15

The term "diffusion of innovation" refers to the:

A) process of vertical integration between a manufacturer and its suppliers.
B) process by which a statement that describes a product or a service is presented to potential buyers or users to obtain their reactions.
C) process by which the use of a new product or a service spreads throughout a market group over time and over various categories of adopters.
D) process of balancing various engineering,manufacturing,marketing,and economic considerations to develop a product.
E) process of taking apart a competitor's product,analyzing it,and creating an improved product that does not infringe on the competitor's patents.

Question 16

Which of the following terms can be best defined as buyers who want to be the first to have a new product or service?

A) Lead users
B) Laggards
C) Early adopters
D) First movers
E) Innovators

Question 17

The category of buyers that waits and purchases a product after careful review is called:

A) innovators.
B) laggards.
C) early adopters.
D) late majority.
E) lead users.

Question 18

Jeremy is interested in buying a phone that has a music player and provides access to the Internet.After doing a detailed analysis of all the phones in the market that offer these features,he decides to buy a recently released model.Which of the following groups of buyers best represents Jeremy's buying behaviour?

A) Innovators
B) Early adopters
C) Laggards
D) Early majority
E) Late majority

Question 19

Scott wants to buy a cell phone that operates with the Android operating system (OS),but he decides to wait until more cell phone companies release models with the Android OS.This way,a lot of user reviews would be available and the details about the drawbacks of the OS would also be available.From this scenario,we can say that Scott belongs to the group of buyers called:

A) innovators.
B) laggards.
C) late majority.
D) early majority.
E) late adopters.

Question 20

Greg wants to upgrade his personal computer.He consults his friend Vernon because Vernon is highly knowledgeable in this field and always uses the latest technology.According to the diffusion of innovation model,to which of the following groups does Vernon belong?

A) Innovators
B) Laggards
C) Late majority
D) Early majority
E) Early adopters

Question 21

The manager of a product design company has brought together a group of technical engineers to generate ideas for potential new products.These engineers will arrive at a final decision through a vote on the best ideas or combinations of ideas.This group is engaging in:

A) prototyping.
B) interviewing.
C) reverse engineering.
D) brainstorming.
E) licensing.

Question 22

Alttaire automobiles developed new hybrid cars that were highly fuel efficient and less polluting compared to all its competitors' cars in the current market.The cars developed by Alttaire automobiles achieved instant success in the market because of their unique features.Which of the following factors primarily influenced the high adoption rate of the cars developed by Alttaire automobiles?

A) Complexity
B) High compatibility
C) Observability
D) Relative advantage
E) Trialability

Question 23

Fiery Inc.is a manufacturer of hockey accessories that are lightweight as well as aerodynamic.As a first mover,Fiery was able to fulfill the high demand for these accessories in Arahonia where hockey is a popular sport.The high diffusion of Fiery products in Arahonia was successful because of their:

A) complexity.
B) trialability.
C) compatibility.
D) visibility.
E) observability.

Question 24

Zapper Products Corp.,a system integration services company,provides a pay-per-use option for its business customers that allows them to understand its product's capabilities before they order licensed versions on a large scale.This option has made Zapper Products Corp.extremely popular with smaller firms that plan to invest on information technology infrastructure but have limited funds.The factor that is contributing to the success of Techno Products Corp.is:

A) compatibility.
B) complexity.
C) relative advantage.
D) observability.
E) trialability.

Question 25

Professor Edward has authored a wide range of textbooks on statistics.Professor Edward still prefers to use a typewriter while typing material for his new books as he is not comfortable using a computer.According to the diffusion of innovation model,to which of the following group of buyers does Professor Edward belong?

A) Innovators
B) Laggards
C) Late majority
D) Early majority
E) Fad users

Question 26

A group of scientists at a biotechnology firm conducted extensive trials in a laboratory for over a decade before creating a formula that could be used to develop a drug to treat cancer.The firm invested a lot of money in these trials with the idea of generating revenue through sales.The method used by the company to develop the new product is best termed as:

A) licensing.
B) reverse engineering and improvement.
C) internal research and development.
D) brainstorming.
E) concept testing.

Question 27

Vintage Corp,a leather company,manufactures high-quality handbags for women.All its bags carry a prominent logo of the company and consumers associate this logo with excellent quality.Despite their high price,Vintage handbags are extremely popular.Which of the following factors is influencing the quick diffusion of these handbags?

A) Complexity
B) Relative advantage
C) Trialability
D) Compatibility
E) Observability

Question 28

Snackie,a cookie company,manufactures unique fish-shaped biscuits that are popular with kids.Kids love the distinct shape and novel taste of these biscuits.Which of the following factors is primarily contributing to the popularity of these biscuits?

A) Trialability
B) Observability
C) Complexity
D) Compatibility
E) Relative advantage

Question 29

YumBurgerz,a fast-food outlet,introduced new burgers made with cheese that had low fat content without compromising their taste.This ingredient brought down the price of the burgers and the burgers were an instant success in the market.Which of the following factors was responsible for the quick diffusion of these burgers?

A) High compatibility
B) Complexity
C) Trialability
D) Observability
E) Relative advantage

Question 30

Which of the following would a firm that wants to be the pioneer in creating new products most likely use to generate ideas for products?

A) Licensing
B) Customer input
C) Reverse engineering
D) Internal research and development
E) Market research and development

Question 31

Ming,the owner of a fast-food restaurant,continues to accept only cash for transactions,although credit and debit cards are common practice in neighbouring business establishments.Ming has not adopted the technology because of her fears concerning the security of these transactions.Hence,she belongs to the group of buyers called:

A) early adopters.
B) early majority.
C) laggards.
D) fad users.
E) mature customers.

Question 32

An advertising agency needs to develop an advertisement for a new product for a client.Salima,a manager of the agency,asks her staff to assemble in groups in the presence of a moderator and generate ideas for the advertisement.The source of idea generation used by Salima is:

A) licensing.
B) customer research.
C) internal research.
D) reverse engineering.
E) brainstorming.

Question 33

The diffusion of innovation theory is useful for firms because it primarily helps them:

A) survive in a market where sales come from mostly new products.
B) develop effective promotion,pricing,and other marketing strategies.
C) reduce risk by diversifying into a broad portfolio of products.
D) satisfy the needs of only current customers.
E) actively pursue and focus on laggards.

Question 34

Ronen,a chef working for a prestigious restaurant,has come up with an idea for a new dish.The owner of the restaurant,Jean,is impressed with the new recipe and asks all the other chefs of the restaurant to practise making the new dish for three months until they can reproduce the recipe with the exact taste the owner is looking for.The chefs also test the dish on other restaurant staff before introducing it to customers.The source of idea generation used by Jean is:

A) brainstorming.
B) internal research and development.
C) customer research.
D) licensing.
E) reverse engineering and development.

Question 35

VelTech Corp.,an electronics company,manufactures LCD TVs that are in high demand compared to its competitors' products.Competitors find it difficult to provide the same reliability and after-sales service that this company provides,which lead to high consumer acceptability.Which of the following factors is contributing to the high adoptability of these LCD TVs?

A) High compatibility
B) Complexity
C) Trialability
D) Relative advantage
E) Observability

Question 36

Baked Treats,a confectionary company,introduced maple syrup cookies that became an instant hit in the country of Argonia because Argonians are accustomed to eating cookies.The same product received a lukewarm response in other countries,where traditional snacks have been very different in nature.Which of the following factors contributed to the success of these cookies in Argonia?

A) Compatibility
B) Trialability
C) Complexity
D) Visibility
E) Observability

Question 37

Music Xpress Corp.,a company that manufactures music systems,introduced its new range of jukeboxes in a few malls.These jukeboxes were an instant success because of touchscreen operated menus that provided easy access to songs.To which of the following factors can the success of these jukeboxes be primarily attributed?

A) Trialability
B) Complexity
C) Observability
D) Adaptability
E) Compatibility

Question 38

Scorpion Homes Inc.is a company that provides security-related products to its consumers.However,the burglar alarm system introduced by Scorpion Homes failed because consumers had to possess a certain level of technical skill to use the product effectively.Which of the following factors is affecting the adoption rate of these alarm systems?

A) Complexity
B) Trialability
C) Compatibility
D) Relative advantage
E) Observability

Question 39

The category of buyers that tends to avoid change and relies on traditional products until they are no longer available is called:

A) fad users.
B) early adopters.
C) mature customers.
D) pioneers.
E) laggards.

Question 40

The first step in the development of new products is to:

A) develop visual images of what a product would look like.
B) develop brief written descriptions about the working principle of a product.
C) present an idea to potential buyers to obtain their reactions.
D) develop new ideas by either internal research or market survey.
E) conduct in-depth interviews to test the concept of a new product.

Question 41

TransInfo Inc.,an information technology firm,is trying to develop new software that will facilitate the transfer of documents in a secure and fast manner.The team of engineers at TransInfo has a detailed discussion and come up with several ideas,out of which they accept only the best possible option.This type of idea generation is called:

A) licensing
B) customer research
C) brainstorming
D) market research
E) internal research

Question 42

A group of scientists in a pharmaceutical firm are conducting trials of a new formula they have developed to be used in a drug in the research and development unit of the firm.This method of testing a product prototype is best categorized as:

A) beta testing.
B) test marketing.
C) premarket testing.
D) concept testing.
E) alpha testing.

Question 43

When the product design team of a firm takes ideas with potential,develops them into visual images,and presents them to potential buyers to get their reactions,they are engaging in:

A) brainstorming.
B) idea generation.
C) concept testing.
D) prototyping.
E) reverse engineering.

Question 44

Innovative product users who modify existing products according to their own ideas to suit their specific needs are called:

A) pioneers.
B) lead users.
C) innovators.
D) laggards.
E) early adopters.

Question 45

The process by which an idea that describes a product or a service is presented to potential buyers to obtain their reactions can be best termed as:

A) test marketing.
B) product development.
C) concept testing.
D) diffusion of innovation.
E) reverse engineering.

Question 46

Willfred Inc.is struggling to improve its sales.The sales of Branson Inc.,a major competitor,are soaring because of the company's well-designed and innovative products.Willfred decides to study Branson's product designs in an attempt to understand how it is doing so well.Finally,Willfred creates an improved product that does not infringe on Branson's patents.This type of idea generation is known as:

A) brainstorming.
B) prototyping.
C) reverse engineering.
D) customer research.
E) concept testing.

Question 47

The method of testing that requires potential consumers to examine a product prototype in a real-use setting is known as:

A) conclusive research.
B) beta testing.
C) concept testing.
D) alpha testing.
E) reverse engineering.

Question 48

The process that entails the balancing of various engineering,manufacturing,marketing,and economic considerations to develop a product most accurately defines the term:

A) concept testing.
B) idea generation.
C) product launching.
D) alpha testing.
E) product design.

Question 49

Annie is a designer at a popular clothing brand.She observes people on the streets who modify the clothing according to their needs and styles.Annie uses this input while designing new collections.What is the method of idea generation used by Annie in developing new products?

A) Interviewing
B) Licensing
C) Internal research
D) Brainstorming
E) Customer input

Question 50

Which of the following idea generation methods saves the high costs of in-house research and development for a firm?

A) Brainstorming
B) Licensing
C) Customer input
D) Reverse engineering
E) Market research

Question 51

A cosmetics company,which mainly produces soaps,shampoos,and other skin care solutions for adults,wants to introduce a line of baby products in the market.Since it has no prior experience with baby products,it decides to buy the rights to use a necessary technology from a small research firm.The source of idea generation used by the cosmetics company is:

A) internal research and development.
B) brainstorming.
C) prototyping.
D) licensing.
E) reverse engineering and development.

Question 52

An automobile firm wants to introduce its cars into new international markets to increase its customer base.Since it does not know about customer needs in these markets,it associates itself with local firms that have developed prototypes based on the customer needs of these markets.The method of idea generation used by the automobile firm is:

A) licensing.
B) customer research.
C) internal research.
D) reverse engineering.
E) brainstorming.

Question 53

Alice asks a group of people to test the skateboards she has manufactured.She needs to determine whether they are functioning as intended and if they require any changes before they are released.What is the type of test being conducted by Alice called?

A) Concept testing
B) Test marketing
C) Hypothesis testing
D) Beta testing
E) Alpha testing

Question 54

Garcia Stephens Co.,a clothing company,is unable to improve sales after its designer failed to create designs that satisfied current trends in the market.Another clothing company called Rigby Inc.,on the other hand,is having a successful season and its designs are the current rage in the market.The designers of Garcia Stephens careful studied the designs of Rigby,analyzed them,improved upon them,and then created a whole new range of designs for their own company.Which of the following sources of idea generation has been used by Garcia Stephens Co.?

A) Concept testing
B) Alpha testing
C) Prototyping
D) Brainstorming
E) Reverse engineering

Question 55

Which of the following processes is used to test the performance of a product prototype and is carried out in the research and development unit of a firm?

A) Alpha testing
B) Beta testing
C) Premarket testing
D) Test marketing
E) Concept testing

Question 56

A brief written description of a product or service; its technology,working principles,and forms; and what customer needs it satisfies most accurately defines the term:

A) data.
B) hypothesis.
C) theory.
D) concept.
E) information.

Question 57

A key characteristic of brainstorming sessions that are used to generate new ideas is that:

A) all the ideas generated are exceptionally good because these groups always include experts.
B) all the ideas generated are accepted and implemented at later stages.
C) the ideas generated require no further testing because they are provided by industry experts.
D) no idea can be immediately accepted or rejected.
E) the ideas generated considerably increase the high startup costs.

Question 58

Rudo,the owner of an ice cream parlour,is planning to introduce new flavours into the product line.He decides to take feedback and suggestions from buyers as part of the process to develop innovative and interesting new ice cream flavours.What is Rudo's source of idea generation?

A) Internal research
B) Reverse engineering
C) Brainstorming
D) Customer input
E) Licensing

Question 59

Taking apart a competitor's product,analyzing it,and creating an improved product that does not infringe on the competitor's patents,if any exist,most accurately defines the term:

A) prototyping.
B) reverse engineering.
C) concept testing.
D) brainstorming.
E) alpha testing.

Question 60

The first physical tentative form of a new product that has the same properties as a new product but is produced through different manufacturing processes is called a(n):

A) concept.
B) theory.
C) hypothesis.
D) prototype.
E) image.

Question 61

Which of the following is a stage of the product life cycle in which sales are low and profits small or negative?

A) Introduction
B) Levelling
C) Maturity
D) Growth
E) Decline

Question 62

After the new product of BG-Mobile Corporation is released in the market,the category of buyers who will play a crucial role in the initial marketing of this product are the:

A) early adopters.
B) innovators.
C) early majority.
D) late majority.
E) lead users.

Question 63

Mirka Beauty Products marketed its product by educating consumers about the benefits of the additional feature it provided in its product.The marketing mix variable that benefited from the results of the tests is:

A) quantity.
B) promotion.
C) place.
D) price.
E) size.

Question 64

What is the source for idea generation employed by the research team at BG-Mobile Corporation called?

A) Licensing
B) Brainstorming
C) Reverse engineering
D) Customer research
E) Observation of lead users

Question 65

Which of the following is the stage of the product life cycle that is characterized by a peak in sales and a high number of competitors and competitive products but a gradual decline in profits?

A) Introduction
B) Growth
C) Maturity
D) Decline
E) Initiation

Question 66

Firms either position themselves for a niche market of loyal consumers or they exit the market during the:

A) introduction stage of the product life cycle.
B) levelling stage of the product life cycle.
C) maturity stage of the product life cycle.
D) growth stage of the product life cycle.
E) decline stage of the product life cycle.

Question 67

A cosmetics company had launched a product that earned good revenues for the company.A recent market analysis shows intense competition for market share from a large number of competitors.The company decides to spend more on marketing the product to help it to retain its market share.In the context of the product life cycle,the product is currently in the:

A) maturity stage.
B) growth stage.
C) initiation stage.
D) introduction stage.
E) decline stage.

Question 68

Which of the following statements is true regarding the introduction stage of the product life cycle?

A) It is marked by a rapid growth in industry sales and also an increase in the number of competitors.
B) At this stage,firms attempt to reach new customers by studying their preferences and producing different product variations.
C) It usually starts with a single firm,and innovators form the main category of buyers.
D) It is characterized by intense competition for market share by firms,which leads to an increase in marketing costs.
E) It is marked by a growing number of product adopters and also an increase in the number of product versions available.

Question 69

The method of determining the potential success of a new product by introducing the product to a limited geographical area prior to a national launch is called:

A) alpha testing.
B) beta testing.
C) concept testing.
D) test marketing.
E) premarketing.

Question 70

A new product launched by a company is showing a rise in sales and a rapid rise in profits,and is being purchased by a group of early adopters and early majority buyers.In the context of the product life cycle,the product is in the:

A) introduction stage.
B) growth stage.
C) decline stage.
D) maturity stage.
E) initiation stage.

Question 71

Which of the following is a stage in the product life cycle that is characterized by an increase in sales,rapid increase in profits,and few but increasing number of competitors?

A) The growth stage
B) The introduction stage
C) The maturity stage
D) The levelling stage
E) The decline stage

Question 72

The later phases of the maturity stage of a product is characterized by:

A) increased sales.
B) market saturation.
C) an increase in profits.
D) less market segmentation.
E) increasing numbers of early adopters.

Question 73

During the growth stage of a product life cycle,firms attempt to:

A) successfully market a newly launched product.
B) reach new consumers by studying their preferences and producing different product variations.
C) increase their customer base by entering into new markets or market segments.
D) defend their market share by developing new products or promotions.
E) market their products to a niche segment of loyal customers.

Question 74

Which of the following steps involved in new product introduction is regarded as the most crucial because it requires huge financial resources and extensive co-ordination of all aspects of the marketing mix?

A) Idea generation
B) Concept testing
C) Product launch
D) Product development
E) Evaluation of results

Question 75

The method used by the team of engineers at BG-Mobile Corporation to test the product prototype is known as:

A) beta testing.
B) concept testing.
C) test marketing.
D) premarket testing.
E) alpha testing.

Question 76

Which of the following statements is true regarding the maturity stage of the product life cycle?

A) It is characterized by the adoption of products by early adopters and early majority.
B) Firms try to ride the sales trend and firmly establish a brand during this stage.
C) It is characterized by rising sales,increasing profits,and few competitors.
D) Most firms usually exit the market at this stage on account of low profit margins.
E) It is characterized by increased marketing costs,low profits,and market saturation.

Question 77

The method of testing employed by Mirka Beauty Products to test its product in the above scenario is best categorized as:

A) premarket testing.
B) test marketing.
C) alpha testing.
D) concept testing.
E) beta testing.

Question 78

An automobile firm is positioning its product to serve only a specific group of brand loyalists.This shows that the particular product is in the:

A) maturation stage of its life cycle.
B) growth stage of its life cycle.
C) decline stage of its life cycle.
D) introduction stage of its life cycle.
E) levelling stage of its life cycle.

Question 79

The form of market testing conducted by firms before a newly developed product or service is brought to the market to determine how many customers will try it and then continue to use it is known as:

A) premarket testing.
B) alpha testing.
C) beta testing.
D) concept testing.
E) hypothesis testing.

Question 80

A manufacturing firm has recently launched a new product and has no competitors in the market.Innovators have started buying the product.In the context of the product life cycle,the product is in the:

A) growth stage
B) maturity stage
C) introduction stage
D) decline stage
E) levelling stage