Test Your Knowledge About Basic Product Marketing!

1. It is easy for marketing managers to predict how long a product or brand will stay in each stage of the product life cycle.

True.

False.

Marketing managers cannot accurately predict how long a product or brand will stay in each stage of the product life cycle. The duration of each stage can vary depending on various factors such as market conditions, competition, consumer preferences, and technological advancements. While marketing managers can make educated guesses based on market research and historical data, there are too many variables involved to make precise predictions. Therefore, the statement is false.

Explanation

Marketing managers cannot accurately predict how long a product or brand will stay in each stage of the product life cycle. The duration of each stage can vary depending on various factors such as market conditions, competition, consumer preferences, and technological advancements. While marketing managers can make educated guesses based on market research and historical data, there are too many variables involved to make precise predictions. Therefore, the statement is false.

2. Testing of new product concepts in a group of a targeted segment of the market is called

Concept development

Concept testing

Material testing

Market screening

Concept testing refers to the process of evaluating new product concepts or ideas within a specific group or segment of the market. This involves gathering feedback, opinions, and reactions from potential consumers to determine the viability and potential success of the concept. By conducting concept testing, companies can gain insights into consumer preferences, identify areas for improvement, and make informed decisions about whether to proceed with the development and launch of a new product. It helps in reducing the risk of failure and ensuring that the final product meets the needs and expectations of the target market.

Explanation

Concept testing refers to the process of evaluating new product concepts or ideas within a specific group or segment of the market. This involves gathering feedback, opinions, and reactions from potential consumers to determine the viability and potential success of the concept. By conducting concept testing, companies can gain insights into consumer preferences, identify areas for improvement, and make informed decisions about whether to proceed with the development and launch of a new product. It helps in reducing the risk of failure and ensuring that the final product meets the needs and expectations of the target market.

3. What is a 'branded house'?

A department store

A company that sells multiple brands

An alternative name for corporate branding

A single master brand which spans a set of sub-brands

A branded house refers to a single master brand that encompasses a group of sub-brands. In this branding strategy, the parent brand is prominent and all the sub-brands are linked to it. The sub-brands benefit from the reputation and recognition of the master brand, creating a cohesive and unified brand identity. This approach allows for consistent messaging and a clear brand hierarchy, making it easier for consumers to associate the sub-brands with the parent brand.

Explanation

A branded house refers to a single master brand that encompasses a group of sub-brands. In this branding strategy, the parent brand is prominent and all the sub-brands are linked to it. The sub-brands benefit from the reputation and recognition of the master brand, creating a cohesive and unified brand identity. This approach allows for consistent messaging and a clear brand hierarchy, making it easier for consumers to associate the sub-brands with the parent brand.

4. The product life cycle:

Describes the stages a new product idea goes through from beginning to end.

Has five major stages.

Applies more to individual brands than to categories or types of products.

Shows that sales and profits tend to move together over time.

All of the above.

The product life cycle is a concept that describes the stages a new product idea goes through from its introduction to the market until its decline or discontinuation. It encompasses five major stages: introduction, growth, maturity, saturation, and decline. This concept applies more to individual brands rather than categories or types of products. Furthermore, the product life cycle demonstrates that sales and profits of a product tend to move together over time.

Explanation

The product life cycle is a concept that describes the stages a new product idea goes through from its introduction to the market until its decline or discontinuation. It encompasses five major stages: introduction, growth, maturity, saturation, and decline. This concept applies more to individual brands rather than categories or types of products. Furthermore, the product life cycle demonstrates that sales and profits of a product tend to move together over time.

5. When thinking about the product life cycle, a good manager knows that:

Sales and profits for individual brands always follow the same life cycle pattern as industry sales and profits.

The only stage in which products are introduced is the market introduction stage.

All products will eventually earn a profit.

A product that is mature in one market may be in the growth stage in another international market.

All of the above.

A product that is mature in one market may be in the growth stage in another international market because different markets have different levels of demand and adoption rates. While a product may have reached its peak and started to decline in one market, it may still be experiencing growth and gaining market share in another market where it is relatively new. This highlights the importance of considering international expansion as a strategy to extend the life cycle of a product and maximize its profitability.

Explanation

A product that is mature in one market may be in the growth stage in another international market because different markets have different levels of demand and adoption rates. While a product may have reached its peak and started to decline in one market, it may still be experiencing growth and gaining market share in another market where it is relatively new. This highlights the importance of considering international expansion as a strategy to extend the life cycle of a product and maximize its profitability.

6. Which statement is true about a product in the sales decline stage of the product life cycle?

Brand managers should phase-out this product as quickly as possible.

A declining product may still be profitable for some time so a gradual phase-out may be appropriate.

Customers will always abandon the declining product immediately if an alternative is available.

Phasing-out a product at this time is fairly easy and this strategy will cut future losses.

None of the above statements are true.

In the sales decline stage of the product life cycle, a product's sales are decreasing. However, it doesn't necessarily mean that the product is no longer profitable. It may still generate profits for some time before becoming unprofitable. Therefore, instead of immediately phasing out the product, a gradual phase-out may be more appropriate. This allows the company to continue benefiting from the product's profitability while also preparing for its eventual discontinuation.

Explanation

In the sales decline stage of the product life cycle, a product's sales are decreasing. However, it doesn't necessarily mean that the product is no longer profitable. It may still generate profits for some time before becoming unprofitable. Therefore, instead of immediately phasing out the product, a gradual phase-out may be more appropriate. This allows the company to continue benefiting from the product's profitability while also preparing for its eventual discontinuation.

7. Why do many advertisements contain a pack shot?

It is to help customers to recognize the packaging and remember the message of the advert.

It is a legal requirement.

It ensures customers will remember the advert and what product it was for.

It is a requirement of the advertising code of practice.

Many advertisements contain a pack shot to help customers recognize the packaging and remember the message of the advert. By including an image of the product's packaging, it creates a visual association in the minds of the customers, making it easier for them to identify the product later on. Additionally, seeing the packaging reinforces the message of the advert, ensuring that customers remember both the product and the advertisement itself. This helps to increase brand recognition and recall, ultimately leading to potential sales.

Explanation

Many advertisements contain a pack shot to help customers recognize the packaging and remember the message of the advert. By including an image of the product's packaging, it creates a visual association in the minds of the customers, making it easier for them to identify the product later on. Additionally, seeing the packaging reinforces the message of the advert, ensuring that customers remember both the product and the advertisement itself. This helps to increase brand recognition and recall, ultimately leading to potential sales.

8. Which of the following statements about the commercialization stage of the new-product development process is FALSE?

A firm should always rollout the product to the entire target market at one time.

Channels of distribution need to be filled with goods.

Introductory promotion tends to be more costly if the firm is entering a very competitive market.

People need to be hired and trained to provide services.

All of the above statements are false.

The correct answer is that a firm should always rollout the product to the entire target market at one time. This statement is false because there are different strategies for product rollout, such as phased rollout or regional rollout, depending on the company's resources, market conditions, and target audience. Rolling out a product to the entire target market at once may not be feasible or effective in some cases.

Explanation

The correct answer is that a firm should always rollout the product to the entire target market at one time. This statement is false because there are different strategies for product rollout, such as phased rollout or regional rollout, depending on the company's resources, market conditions, and target audience. Rolling out a product to the entire target market at once may not be feasible or effective in some cases.

9. As a product moves into the market maturity stage of the product life cycle:

Consumers tend to view products as being more similar.

The competitive situation moves toward monopoly.

Promotion emphasizes informing consumers more than persuading them.

There is less consideration of competition in setting prices.

All of the above.

In the market maturity stage of the product life cycle, consumers tend to view products as being more similar. This is because by this stage, most competitors have entered the market and have developed similar products to meet the needs of the target market. As a result, consumers perceive less differentiation between products and may base their purchasing decisions on factors such as price, brand reputation, or convenience. This shift in consumer perception highlights the need for companies to differentiate their products through effective marketing strategies to maintain a competitive edge.

Explanation

In the market maturity stage of the product life cycle, consumers tend to view products as being more similar. This is because by this stage, most competitors have entered the market and have developed similar products to meet the needs of the target market. As a result, consumers perceive less differentiation between products and may base their purchasing decisions on factors such as price, brand reputation, or convenience. This shift in consumer perception highlights the need for companies to differentiate their products through effective marketing strategies to maintain a competitive edge.

10. National Family Opinion (NFO) contacts several hundred members of its consumer panel and provides them with a printed description of a new chewing gum and its package. Consumers are then given a survey containing several multiple-choice questions about their attitudes toward the new product, based on what they read in the description. The final survey question asks consumers to indicate the likelihood that they would purchase the product. NFO seems to be conducting a:

Market test.

Concept test.

Prototype test.

Sensitivity test.

Attitude test.

The correct answer is concept test because NFO is presenting a description of a new chewing gum and its package to consumers and asking them multiple-choice questions about their attitudes toward the product based on the description. This type of test is typically done to gather feedback and assess consumer interest and acceptance of a new concept or idea before it is fully developed or launched in the market.

Explanation

The correct answer is concept test because NFO is presenting a description of a new chewing gum and its package to consumers and asking them multiple-choice questions about their attitudes toward the product based on the description. This type of test is typically done to gather feedback and assess consumer interest and acceptance of a new concept or idea before it is fully developed or launched in the market.