Over the past couple of weeks at the Idea Incubator, we’ve been examining the role customers play in innovation. We’ve shown that successful commercialization results from asking three market research questions for new product development (NPD).
Market segmentation and needs analysis help to identify who the customers are and what they really want. In this post, we’ll take a look at how the NPD team can translate customer segmentation and trade-off data into a product blueprint.
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What is the Desired Product?
After addressing who the customers are and what they really want, the firm is on a solid path to developing a successful new product. The best market research technique at this stage of the innovation program is concept testing.
Concept testing can reveal whether customers’ voices have been heard accurately, whether the new product will meet their diverse needs, and if the new product will be purchased. Notice that purchasing price is not usually addressed in concept testing. Product sales forecasts are normally based on quantitative data and may be generated later in the NPD process.
The concept test is fairly simple in theory. A concept may consist of a written narrative, a sketch, or a very rough prototype. Most often the concept presented to potential customers includes the following information on jsut one sheet of paper:
- Sketch or illustration of the new product,
- Description of customer needs,
- Features of the new product,
- How the product will function, and
- Benefits offered by the new product.
Customers will respond with their purchase intent, assuming the product is available in the form described.
Drawbacks of Concept Testing
While concept testing is a fundamental tool to test whether customers are interested in and really want the product as envisioned, the technique is lacking in a couple of arenas. This is, of course, why no single market research technique can fully detail consumer needs and product design characteristics by itself. Smart NPD teams utilize multiple market research techniques throughout the NPD process.
Concept tests generally involve very short interaction times with customers. A customer may be exposed to the written concept statement for about thirty seconds to one minute before offering an opinion or impression. Thus, it is important that the product description is concise and clearly indicates the function of the new product and how it will solve a given problem. Any contradictory or confusing sentences will lead to negative acceptance of the product.
Moreover, concepts for radical innovations or products that reflect a personal sense of value are not likely to generate positive consumer feedback. While end-users can be trained for idea generation (see Managing Customers, Stakeholders, and Bosses), their impressions and beliefs based upon a brief encounter with a new product concept cannot be expected to establish new uses or new technologies fully.
Likewise, art, entertainment, and luxury are typically defined by an individual’s personal style and experience. These characteristics are helpful to understand when segmenting a market, but are not so useful in judging potential market success of a new product.
Concept testing should be completed prior to moving into full-scale product development. The NPD team must integrate customer wants and needs into the final product design. Translating benefits offered through features in the concept statement to engineering specifications is a relatively straightforward task for a cross-functional team.
In addressing innovation success, companies need to answer three questions for new product development. These include: Who are my customers? What do they really want? and What is the desired product? Answering these three fundamental market research questions can yield higher rates of innovation success as well as more effective, stream-lined new product development efforts.
For more information on market research methodologies in new product development, please feel free to contact us at firstname.lastname@example.org or by phone at 281-280-8717. You might also be interested in a facilitated New Product Development Professional (NPDP) certification workshop.
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