Question 1

Companies usually have several product mixes but only one product line.

Accepted Answer

Companies usually have multiple product lines within a product mix. A product line is a group of products within the same category or segment, while a product mix refers to the total range of products a company offers. For example, a company may have a product mix that includes multiple product lines such as electronics, home goods, and personal care.

Question 2

An example of a store brand is a local grocer reaching an agreement to give Campbell's soups the most favourable shelf location in the soup section of the store.

Accepted Answer

The statement is actually describing a brand name product (Campbell's soups) being given a favourable shelf location in a store. Store brands are typically products that are produced and marketed by the store itself, using the store's own name or a specifically created private label.

Question 3

Extensive product lines are always a better strategy than smaller product lines.

Accepted Answer

While extensive product lines may offer more options for customers, smaller product lines often allow for a more focused and targeted marketing approach. Additionally, smaller product lines can lead to cost savings in terms of production and inventory management. Ultimately, the best strategy will depend on the specific industry and target market.

Question 4

When Pillsbury reached an agreement with M&M's to include the candy in one of its ready-to-bake cookie dough products, the two companies were using a strategy known as co-branding.

Accepted Answer

Co-branding is a marketing strategy where two or more brands collaborate to create a product or service. In this case, Pillsbury and M&M's collaborated to create a cookie dough product that included M&M's, making it a co-branded product.

Question 5

Suppliers and competitors can sometimes be sources for new product ideas.

Accepted Answer

Suppliers and competitors often have knowledge and insights about industry trends and customer needs, which can inspire new product ideas. Additionally, observing competitor's shortcomings can inspire innovation and improvement in one's own product offerings.

Question 6

Shirtzter, a manufacturer of men's shirts and jackets, has just reached an agreement to pay Kawasaki a substantial fee for the right to use the company's name and logo on some of its clothing lines. This type of arrangement is known as secondary branding.

Accepted Answer

This type of arrangement is known as licensing, where one company (Shirtzter) pays another (Kawasaki) for the rights to use its brand name, logo, or other intellectual property.

Question 7

Manufacturers seldom place much emphasis on packaging, because this aspect of the product has little relevance to the customer's decision-making process.

Accepted Answer

Packaging can have a significant impact on a customer's decision-making process, as it can convey important information about the product and create a positive or negative impression. Manufacturers may invest considerable resources in designing and testing packaging to optimize its appeal and effectiveness.

Question 8

The goal of dynamically continuous product innovation is to find a way to produce a product more efficiently than competitors in order to offer it at a lower price.

Accepted Answer

The goal of dynamically continuous product innovation is to improve an existing product in a way that significantly enhances its performance or features, but does not necessarily aim at producing it more efficiently or at a lower price than competitors. This type of innovation often requires a significant investment in research and development and may involve a disruptive change in the market.

Question 9

Increasingly, leading-edge companies are attempting to directly involve their customers in their new product development processes.

Accepted Answer

This statement is true. Companies are recognizing the importance of customer input and feedback in developing successful products that meet their needs and preferences. Crowd-sourcing and co-creation are some of the methods used to involve customers in new product development.

Question 10

Organizations use brand extension when similar products are added to an existing product line under the same brand name. Offering additional features to a cell phone package is an example of brand extension.

Accepted Answer

Offering additional features to a cell phone package is an example of product line extension, not brand extension. Brand extension involves using an existing brand name for new products in a different product category.

Question 11

In a highly competitive market, the best packaging strategy usually consists of emulating the packaging of a successful competitor.

Accepted Answer

Emulating the packaging of a successful competitor may not always be the best strategy as it may not differentiate a product from its competitors. It is important for companies to create their own unique packaging that communicates their brand and product offerings effectively. Moreover, blindly copying a competitor's packaging may also lead to legal issues related to trademark and copyright infringement.

Question 12

Apple's decision to introduce iPods in different sizes, colours, and storage capacities is an example of line extension.

Accepted Answer

Line extension refers to a marketing strategy in which a company adds new products to an existing product line in order to diversify and expand its target market. By introducing iPods in different sizes, colours, and storage capacities, Apple is extending its existing iPod product line to cater to varied customer needs and preferences. Thus, the statement is true.

Question 13

According to BusinessWeek magazine, one common mistake in building a brand is to use "surround sound" promotion that engulfs customers in the brand message. The magazine observes that such an approach often overwhelms and turns off potential customers.

Accepted Answer

BusinessWeek magazine suggests that a "surround sound" approach to promotion, which immerses customers in the brand message from multiple angles, can be effective in building a brand. This strategy aims to create a consistent and comprehensive brand experience, rather than overwhelming potential customers.

Question 14

Continuous innovation involves slight modifications of existing products.

Accepted Answer

Continuous innovation involves making incremental changes to existing products, rather than introducing entirely new ones.

Question 15

For a business to thrive long-term, effective new product development is vital.

Accepted Answer

Effective new product development allows a business to stay competitive by continuously offering new and improved products to attract and retain customers, increase revenue, and expand into new markets. Without it, a business may stagnate or even decline over time.

Question 16

Discontinuous innovation occurs when marketers find a new use for an existing product or technology.

Accepted Answer

Discontinuous innovation refers to the introduction of a product or service that fundamentally changes the market or how people live, often creating entirely new industries or ways of doing things, rather than finding new uses for existing products.

Question 17

Continuous innovation is the process of making significant changes to existing products.

Accepted Answer

Continuous innovation refers to small, incremental changes and improvements made to a product or service over time, rather than significant changes.

Question 18

A brand is a product's identity that sets it apart from products in the same category that are offered by other producers.

Accepted Answer

This statement is true as a brand is a unique identity of a product that distinguishes it from other products in the market. It includes a brand name, logo, design, packaging and other elements that create a unique image for the product in the minds of consumers. A strong brand can help a product to stand out in a crowded market, build customer loyalty, and increase sales.

Question 19

Idea generation and idea screening are the first two stages of the new product development process.

Accepted Answer

This statement is true. Idea generation involves gathering potential ideas for new products or improvements to existing products, while idea screening involves evaluating these ideas based on their feasibility and potential for success.

Question 20

The decision by Coca-Cola to begin selling breakfast cereal under the Coca-Cola brand name would be an example of a brand extension.

Accepted Answer

Brand extension refers to when a company uses its brand name to introduce new products in a different product category. In this case, Coca-Cola would be using its brand name to introduce breakfast cereal, which is a different product category than its usual soft drink products.

Quiz 11: Product and Promotion: Creating and Communicating Value