CPM Product Development & Pricing Strategy Flashcards
6 cards from real CPM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CPM Product Development & Pricing Strategy flashcards as text
Which stage of the new product development process involves filtering out ideas that do not align with company objectives?
Answer: Idea screening
Idea screening evaluates generated ideas against strategic fit, feasibility, and resource requirements to eliminate unviable concepts early.
In the BCG Growth-Share Matrix, a product with high market share in a low-growth market is classified as a:
Answer: Cash Cow
Cash Cows generate strong cash flow due to high market share but require little investment because market growth is low.
Which pricing strategy sets an initial high price to capture early adopters before gradually lowering it?
Answer: Skimming pricing
Price skimming maximizes revenue from early adopters who are willing to pay a premium before targeting more price-sensitive segments.
The concept of 'price elasticity of demand' measures:
Answer: How quantity demanded changes relative to a price change
Price elasticity of demand quantifies the percentage change in quantity demanded divided by the percentage change in price.
A company launches a new product at a low price to quickly capture market share. This is called:
Answer: Penetration pricing
Penetration pricing uses a low initial price to attract a large customer base rapidly and discourage competitor entry.
Which product life cycle stage typically sees the highest level of promotional spending relative to sales?
Answer: Introduction
During the introduction stage, heavy promotion is needed to build awareness and trial among an audience unfamiliar with the product.