This week’s post addresses the first of the five major benefits of adopting consumer insight-driven decision making.
Benefit #1: Getting consumer feedback reduces the risk of making the wrong decision.
Many decisions have to be made throughout the new product development process. Any one of these decisions could have a profound impact on whether the product is going to be a marketplace success or not. When you get consumer feedback at key points in the new product development process, you can be more confident that the product and marketing decisions you are making are the right decisions.
Here are a couple of real-world examples of how getting consumer feedback can reduce the risk of a wrong decision.
Should we do tooling for all of these products?
A kitchenware manufacturer developed a line of 19 innovative new kitchen gadgets a couple of years ago. Before they invested in tooling, they wanted to find out how interested consumers would be in each of the items.
An online concept test determined that purchase likelihood ranged from a low of 7% (meaning that 7% of the survey respondents said that they would be “very” or “completely” likely to purchase the product at the given price) to a high of 42%. Based on the results of the concept test, the client dropped the five items with less than 15% purchase likelihood from the line, saving them an estimated $17,000 in tooling costs.
Which package design will package grab consumers’ attention at retail and make them want to buy the product?
A manufacturer of household cleaning tools had developed a new handheld cleaning tool that utilized UV light to clean and sanitize instead of chemicals. Because the product was so different from anything else on the market, they knew that the packaging was going to have to be particularly effective at convincing prospective purchasers that the product really worked.
They had come up with several different versions of the package. The stakes were too high to base their decision on experience, intuition, and personal preference. They needed to find out what consumers thought of the three different versions of the package.
The package test revealed that one of the package designs was much better at communicating what the product did and at making respondents want to buy the product than either of the other two package designs. However, none of the package designs provided enough information on how effective the product was or how it worked. As a result, purchase interest was low because respondents did not feel that they had enough information to make an informed purchase decision.
Which version of the product should we develop?
An inventor who had come up with a nifty energy management device needed to decide which of the two different versions of the product he should continue to develop. He and his investors were leaning toward the more expensive version because it had more features.
The product concept test revealed that purchase likelihood for the lower priced unit was significantly higher than the purchase likelihood for the higher price unit. It turned out that the features the inventor and his investors were so enamored with were not features that prospective purchasers would be willing to pay extra for.
Confirm that you are making the right decision with consumer feedback
In each of these cases, if the manufacturer relied on intuition and management experience and preferences, they would have made a wrong decision. By spending a couple thousand dollars to obtain consumer feedback, they ultimately saved thousands, if not hundreds of thousands, of dollars in product development costs, tooling, and packaging.