CHP 7 Part 2

Customer Feedback and Product Development

• Concept Testing Overview

  • Process of assessing new product ideas through feedback.

  • Integrates customer insights to improve or eliminate concepts.

Initial Screening of Ideas

• Preliminary Idea Screening by PIC

  • Most new product ideas are filtered out before concept development.

  • Common exclusions include:

    • Ideas needing unavailable technologies.

    • Ideas for customers lacking firm knowledge.

    • Ideas with inappropriate levels of innovativeness.

    • Ideas misaligned with competitive pricing or positioning.

Practical Applications of Preliminary Idea Screening (PIC)

• Examples of Effective Idea Elimination

  • Hallmark: Rejected low quality gift items to maintain brand integrity.

  • Rucker: Disqualified items unrelated to oil wells, leveraging existing technology.

Market Analysis Following PIC Approval

• Market and Initial Reactions

  • Conducted post-PIC approval.

  • Initial reaction assessments can be quick; aim to avoid thoughtless concept launches.

  • Emphasizes multiple perspectives; involve diverse stakeholders in feedback.

  • Maintain records for objective evaluations.

Consideration in Initial Reactions

• Key Questions for Initial Reaction

  • Market Worth: Attractiveness to target customers?

  • Firm Worth: Management’s perception of the project?

  • Competitive Insulation: Can product advantages withstand competition?

Concept Testing Challenges

• Potential Obstacles

  • Test concepts leading to subjective or unquantifiable benefits (e.g., aesthetics).

  • Risk of management mismanagement leads to blame in product launch failures.

  • Customers may be unaware of their own problems, complicating feedback collection.

Successful Concept Testing Examples

• Case Studies

  • Suga Test Instruments: Artificial snow machine failed due to unasked market needs.

  • Other examples highlight products that either flop or succeed unexpectedly after testing.

Product Concept Statement

• Definition and Structure

  • Describes expected product features and benefits.

  • Example: Introducing an electric razor with cutting-edge technology.

Various Product Statements and Market Needs

• Constructing Effective Product Statements

  • Snack example emphasizes healthy alternatives.

  • Campbell's soup positions convenience and pleasant experience.

  • Clorox emphasizes safety and suitability for home use.

Purposes of Concept Testing

• Identify poor concepts for elimination.

• Estimate potential sales and market share.

• Aid in conceptual development and trade-off assessments among product attributes.

Concept Test Procedure

• Steps Involved

  • Draft concept statement and specific objectives.

  • Select commercialization plans and pricing details.

  • Finalize respondent types and response situations.

  • Conduct interviews and analyze feedback systematically.

Concept Testing Methodologies

• Formats and Tools

  • Virtual reality utilized for visualizing product concepts in office settings.

  • Using specific respondent groups (e.g., lead users) for targeted feedback.

Respondent Situations and Collecting Feedback

• Techniques

  • Employing various methods (e.g., telephone interviews) for diverse consumer feedback.

  • Utilizing tools like Nielsen Optimizer for in-depth analysis of product interest.

Mail Concept Test Description and Questions

• Example Test

  • Descriptions emphasize taste and health benefits of a diet soft drink.

  • Variety of questions to measure perceived differentiation and buying intentions.

More Sample Questions and Responses

• Different segmentation techniques based on anticipated preferences and categorized uses.

• Included ranking type questions for respondent engagement.

Concept Testing Visualization

• Creative Solutions

  • Example of aerosol cleaner targeting specific odors with specific features.

Final Concept Testing Examples

• Real-World Applications

  • Discussion of a new diet soft drink indicating market positioning and anticipated competitor reactions.