Developing New Products - Chapter 8

Question 1

Product

Answer 1

Anything that is of value to a consumer & can be offered through a marketing exchange

Question 2

Innovation

Answer 2

The process by which ideas are transformed into new products & services that will help firms grow.

Question 3

What are the 2 choices firms would have to choose without innovation?

Answer 3

Continue to market current products to current customers
or
take the same product to another market w/ similar customers

Question 4

Diffusion of innovation

Answer 4

The process by which an innovation spreads throughout a market group, over time & over various categories of adopters

Question 5

Pioneers

Answer 5

New product introductions that establish a completely new market or radically change both the rules of competition & consumer pref in a market

Question 6

Disruptive innovations

Answer 6

New, generally simpler, are less sophisticated & may be less expensive than existing products or services

Question 7

First movers

Answer 7

The first to create the market or product category, they become readily recognizable to consumers & often establish a commanding & early market share lead

Question 8

Innovators

Answer 8

Buyers who want to be the first to have the new product/service.
They are crucial to the success of any new product/service bye they help the product gain market acceptance

Question 9

Early adopters

Answer 9

The 2nd group of consumers in the diffusion of innovation model, after innovators, to use a product or service innovation; generally don’t like to take as much risk as innovators

Question 10

Early majority

Answer 10

Rep approx 34% of the population, is crucial bit few new products/services can be profitable until this large group buys them

Question 11

Late majority

Answer 11

The last group of buyers to enter a new product market; when they do the product has achieved its full market potential

Question 12

Laggards

Answer 12

Makes up roughly 16% of the market
They like to avoid change & rely on traditional products until they are no longer available

Question 13

What is the Product Development Process

Answer 13

1. Idea Generation
2. Concept Testing
3. Product Development
4. Market Testing
5. Product Launch
6. Evaluation of Results

Question 14

Reverse engineering

Answer 14

Involves taking apart a competitor’s product, analyzing it, and creating an improved product that doesn’t infringe on the competitor’s patents, if any exists

Question 15

Concept testing

Answer 15

The process in which a concept statement is presented to potential buyers rep of the target market or users to obtain their reactions

Question 16

Product development

Answer 16

A process of balancing various engineering, manufacturing, marketing, and economic considerations to develop a product’s form and features or a service’s features

Question 17

Prototype

Answer 17

The first physical form or service description of a new product, still in rough or tentative form, that has the same properties as a new product but is produced through diff manufacturing processes, sometimes even crafted individually

Question 18

Beta testing

Answer 18

Having potential consumers examine a product prototype in a real-use setting to determine its functionality, performance, potential problems, and other issues specific to its use

Question 19

Premarket tests

Answer 19

Conducted before a product/service is brought to market to determine how many customers will try and then continue to use it

Question 20

Test marketing

Answer 20

Introduces a new product or service to a limited geographical area prior to a national launch
If the market testing returns w positive results; product launch