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Unformatted text preview: nt begins to develop marketing strategies.
Packaging, branding, and labeling decisions are made, while preliminary promotion, price, and
distribution strategies are developed. Technical feasibility of manufacturing the product at a
reasonable cost is also examined.
Prototype product models are often laboratory and use tested during the development stage.
Laboratory tests subject products to much more severe treatment than is expected by end users.
Laboratory testing can ensure products conform to established safety standards. Use tests place
the prototype in consumers’ homes or businesses for trial.
PTS: 1 REF: 175-177 OBJ: 11-2 TOP: AACSB Communication
KEY: CB&E Model Product MSC: BLOOMS Synthesis 7. After products and marketing programs have been developed for new products, they are usually
tested in the marketplace. What is test marketing? How may a company benefit from the use of
such marketing? How can test marketing cause problems for a company?
Test marketing is a limited introduction of a product and a marketing program to determine the
reactions of potential customers in a market situation.
An advantage of test marketing is that it allows management to evaluate alternative strategies and
see how well the various aspects of the marketing mix fit together. Test marketing may reduce
risk by allowing modification of a marketing mix before national introduction or by withdrawal
of a product with failure characteristics.
However, test markets have several disadvantages: costs of test markets are high, it reveals the
product to competitors, and a product’s success in a test market does not guarantee it will be a
KEY: CB&E Model Product OBJ: 11-2 TOP: AACSB MSC: BLOOMS Synthesis 8. Discuss alternatives to traditional test marketing.
Supermarket scanner testing (single-source research) is one test marketing alternative. Another
alternative is simulated (laboratory) market testing. These tests entail showing people
promotional materials for several products, including the test products. These people then shop at
a mock or real grocery store, where purchases are recorded. Another alternative is online test
marketing. Many firms are finding that the Internet offers a fast, cost-effective way to conduct
KEY: CB&E Model Strategy OBJ: 11-2 TOP: AACSB MSC: BLOOMS Synthesis 9. What is the final stage in the new-product development process? What tasks are set in motion
during this stage?
The final stage in the new-product development process is commercialization. The decision to
commercialize sets several tasks in motion: ordering production materials and equipment, starting
production, building inventories, shipping the product to field distribution points, training the
sales force, announcing the product to the trade, and advertising to potential customers.
KEY: CB&E Model Product OBJ: 11-2 TOP: AACSB...
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This document was uploaded on 09/29/2013.
- Fall '13