Chapter 12

alpha testing

alpha testing

Firms use this to determine whether a product will perform according to its design and whether it satisfies the need for which it was intended

beta testing

having potential consumers examine a product prototype in real setting to determine its functionality and potential problems

brainstorming

A group of activity used to generate ideas

concept

Brief written description of a product, its tech, working principles and what customers needs it would satisfy

concept testing

Process in which a concept statement that describes a product is presented to potential buyers or users to obtain their reactions

decline stage

stage of product life cycle when sales decline and the product eventually exists the market

diffusion of innovation

Process by which the use of innovation, whether a product or a service, spreads throughout a market group over time and over various categories of adopters

early adopters

Second group of consumers in the diffusion of innovation model, after innovators, represent 13.5% they dont like to take as much risk

early majority

Group of consumers in the diffusion of innovation model that represent 34% if pop, members dont like to take risk and tend to wait until bugs are worked out

first movers

Product pioneers that are the first to create a market category, marking them readily recognizable to consumers and thus establishing a early market share lead.

growth stage

stage of product life cycle when the product gains acceptance, sales increase and competitors emerge in the product category

innovation

Process by which ideas are transformed into new products and services that help firms grow

innovators

Buyers representing 2.5% of pop, they want to be first to have new products

introduction stage

Stage of product life cycle when innovators start buying the product

laggards

Consumers representing 16% of pop, who like to avoid change and rely on traditional products until they are no longer available.

late majority

Last group of buyers entering new product market, representing 34% of pop; when they do the product has achieved its full market potential

lead users

Innovative product users who modify existing products according to their own ideas to suit their specific needs.

licensing

Method used in developing new products in which a firm buys the rights to use a tech or idea from another firm.

maturity stage

Stage of product life cycle when industry sales reach their peak, so firms try to rejuvenate their products by adding new features or repositioning them

outsourcing

When client firms hires an outside firm to facilitate some aspect of its business. I.e the outsourced firm helps its client develop new products

pioneers (breakthroughs)

New product introductions that establish completely new market or radically change both rules of competition and consumers preferences in a market.

premarket test

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

product development (product design)

process of balancing various manufacturing and economic considerations to develop a products form and features

product life cycle

Defines the stage that new products move through as they enter, get established in, and leave the marketplace thereby offering marketers a starting point for their strategy planning

prototype

First physical form of a new product, still in rough form, that has same properties as new product but is produced through different processes.

R&D consortia

Group of firms that explore new ideas or obtain solutions for developing new products

reverse engineering

taking apart competitors product, analyzing it, and creating an improved product that does not infringe on competitors patents

test marketing

Method of determining the success potential of a new product by offering it to a limited geographical group prior to its full launch