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The costs we have incurred to develop a smartphone application for our
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Updated on: 06 Oct 2023, 12:09
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The costs we have incurred to develop a smartphone application for our company's Qoop product has far exceeded the costs to develop our web platform and the mobile-friendly version of our website. The returns, thus far, do not even come close to recouping our initial investment. We should cap next year's marketing budget for Qoop at $100K. If user adoption for Qoop does not increase to a level that would result in conversion in sales that would, in 2-3 years, result in a modest profit, we should stop the project, cut our losses, and focus on developing another product.
Our innovative application still hasn't gained attention from media. As with all types of product launches these days, we need to get the word out fast and get this product to go viral. I recommend a marketing budget closer to $400K. This will allow us to use some big name celebrities to help us get the word out on television, in magazines, and even through social networks like Facebook and Twitter. Once we get over the hump, further expense will be neglible as marketing will be largely free and will occur through word of mouth. Without strong celebrity promotion from the very beginning, the product launch will fizzle away and die unspectacularly - we'll never recoup our largest product development cost. For anything to go viral, it must have a cool factor, be funny, and be useful. A big name celebrity can help us get over that hump.
Qoop helps complement our existing product offering. While Qoop expenses have been our largest product development cost, the cost should also be shared among the low costs of our other products. In addition, no product should be looked at as a standalone product. It's more important for us to grow our market share and gain competitive advantage in our industry. To do this, we have to launch more products and start generating a portfolio of products to match our big competitors. We should be marketing all of our products alongside Qoop and not just pigeonhole ourselves to promoting just one product whenever we access the TV or social media marketing channels.
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1. Based on the statements, which one of the following can be most reasonably be inferred to be a view held by the company's Qoop developers?
The company has enough funds for development on a new product.
As the adoption of Qoop grows with the company's marketing efforts, more development resources are needed to position the product to scale.
It has taken more financial resources, but not necessarily more developers, to create Qoop than to create the company's other products.
Developers can do a better job to gain user adoption for the smartphone application than can marketers with no technical knowledge.
Marketing has turned 2.0; it is technical marketers who are experienced in programming that are needed to help spread the word throughout the web, not traditional marketers.
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Re: The costs we have incurred to develop a smartphone application for our
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30 Oct 2012, 18:56
As you read the conversation.. CEO says that "The costs we have incurred to develop a smartphone application for our company's Qoop product has far exceeded the costs to develop our web platform and the mobile-friendly version of our website"
And in the last tab CEO says that" we have to launch more products and start generating a portfolio of products to match our big competitors"
So we can infer that the app they made was too costly but they had necessary developers to develop other stuff too..
Re: The costs we have incurred to develop a smartphone application for our
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15 Dec 2020, 20:07
j4jeet wrote:
As you read the conversation.. CEO says that "The costs we have incurred to develop a smartphone application for our company's Qoop product has far exceeded the costs to develop our web platform and the mobile-friendly version of our website"
And in the last tab CEO says that" we have to launch more products and start generating a portfolio of products to match our big competitors"
So we can infer that the app they made was too costly but they had necessary developers to develop other stuff too..
Hope you get the point!
Its tough to explain..
If C is the right choice, one must make the assumption that product launch = more developers (C); if so, one could also assume that launch of product = need more fund to develop a product (A). An option requires additional but not universally-accepted assumption(s) is not likely the correct answer of GMAT.
Re: The costs we have incurred to develop a smartphone application for our
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09 Nov 2021, 21:06
Can anyone explain this ? Should A not be the correct answer ? The passage says that the company can cut its losses and focus on developing new products - for doing so they should have money which is what A points to precisely. Wheras in C, it talks about the number of developers which has not been a point if discussion in the entire passage and cannot be inferred without assumptions
Re: The costs we have incurred to develop a smartphone application for our
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Updated on: 27 Dec 2021, 19:28
GMATGuruNY - curious on your thoughts. Is this really C ? I am surprised - i selected A straight because of the line by the CEO
Quote:
....To do this, we have to launch more products and .....
If the CEO is stating we have to launch more products...well unless the products are already prepared beforehand and just kept in an inventory same where - one can infer that these products have to be developed and then launches will begin.
Thus, not only the developers -- but anyone who reads the statement above in blue -- can safely assume -- there is some extra money in the bank to develop and then launch these products THAT the CEO wants us to launch.
Originally posted by jabhatta2 on 27 Dec 2021, 19:09.
Last edited by jabhatta2 on 27 Dec 2021, 19:28, edited 2 times in total.
Re: The costs we have incurred to develop a smartphone application for our
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27 Dec 2021, 19:11
GMATGuruNY - C to me seemed wrong because per the below in purple - the CEO is referring to Qoop's development cost
Quote:
While Qoop expenses have been our largest product development cost, the cost should also be shared among the low costs of our other products
Option C on the other hand uses the word "financial resource"
Financial resource is a very broad term and in my view, includes a lot more than just product development cost. Financial resources includes ALL kinds of expeneses == development cost + marketing cost + indirect costs (cost incurred but not related to the product - rent / lawyers / day to day business operations like cost of domain name) ... .....
Re: The costs we have incurred to develop a smartphone application for our
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03 Mar 2024, 00:56
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Kripanshi95 wrote:
Can anyone explain this ? Should A not be the correct answer ? The passage says that the company can cut its losses and focus on developing new products - for doing so they should have money which is what A points to precisely. Wheras in C, it talks about the number of developers which has not been a point if discussion in the entire passage and cannot be inferred without assumptions
This is Critical Reasoning. You do not have to select the correct answer. You have to select the best answer. Now, note that everything after not necessarily does not count because it can be true or can be false. It is there just to confuse you. So, ignore everything after not necessarily. Now, try this RC again.
gmatclubot
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