New Product Development

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New Product Development

• Concept Evaluation

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Sample Questions

• Do people think this is a good idea?
• How much would people be willing to pay?
• What color should I make it?
• Would people pay more to get more____?
• What kinds of people will be most interested?
• Are there other uses for this product?
• How often will people buy?
• How much will they buy?
• How many people will buy?
• Which of these three versions should I produce?
• How much assembly are consumers willing to do
  themselves?
• How much service will people expect?

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Techniques

• Focus Group Interviews
• Perceptual Mapping
• Concept Testing
• Conjoint Analysis

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Focus Group Interviews

• Exploratory
• Insight into ideas, more than generation of ideas
• Sampling
• Moderating
• Generalize insights, not effects!

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Perceptual Mapping

• Managerial judgments
• Insight into market structure
• Insight into similarities/competition
• Attribute ratings
• Specify attributes collect data factor analyze
  present means
• Overall similarity ratings
• Collect data mds present positions interpret
  structure

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Perceptual Mapping Applications

• Gaps may suggest new product ideas
• Concept positioning can be assessed
• Maps can suggest directions for developmentideal
  points

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Concept Testing

• Quantitative assessment of a concepts potential
  and potential for improvement
• What is a product concept?
• Sample properly
• Solicit a variety of reactions
• Be aware of likely biases
• Measures of trial, not repeat

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Concept Testing

• MeasuresPI, frequency, amount, general
  diagnostics, specific attribute responses,
  customer characteristics
• AnalysisPI, diagnostics, crosstabs

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• Example Respondent examines proposed
  concept(s).
• What is your reaction to the proposed product?
• Very negative 1 2 3 4 5 6 7 8 9 10 Very
  positive
• Why so positive or negative?________________
• How interested are you in the concept?
• Not at all interested 1 2 3 4 5 Very
  interested
• Why did you answer as you did?___________________
• How likely are you to buy this product at a price
  of ___?
• Definitely not / probably not / maybe / probably
  yes / definitely yes
• Explain your answer to 5.______________________
• What are the products main strengths?____________
  _
• What are the products main weaknesses?___________
  ____

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• Additional measures
• How frequently do you buy this product?
  (categories)
• When you buy, how much do you buy? (categories)
• How unique do you find this product?
• Just like all the rest 1 2 3 4 5 6 7 Very
  unique
• How believable is this product idea?
• Impossible to believe 1 2 3 4 5 6 7 Very
  believable

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More questions

• How important is this product idea to you?
• At a price of _____, does this product seem to
  be a good value?
• How much interest would you have in this product?
• Do you like (specific attribute)? Not at
  all---very much
• Where would you expect to purchase this product?
• Where would you look for information about this
  product?
• In which of the following situations would you
  use this product?

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Still more questions

• In your own words, describe the main idea of the
  product________.
• Which of the following seems best to describe the
  product
• (alternative descriptions)
• Indicate what you believe about each of the
  following product features
• (attributes, followed by appropriate scales)
• Respondent characteristics
• Demographics
• Product use situations
• Place of purchase
• Sources of information
• Attitudes toward competitive brands

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Conjoint analysis

• Advantages mimics real decisions, standard
  metrics, quick and cheap
• Process
• Identify attributes and levels
• Develop an orthogonal array of descriptions
• Identify sample
• Collect rating, ranking, or preference data
• Analyze

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Conjoint Analysis Why not ask directly about
attributes?
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Conjoint analysis

• Output
• Utility weights, usually 0-1.0
• Attribute importance scores (range of utility/sum
  of ranges
• Applications
• Compare attractiveness of various combinations
• Identify best product
• Identify preference segments
• Analyze cost trade-offs
• Forecast sales