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Using Market Research For Product Development “New” is one of the strongest words in marketing. “New” invokes the belief that something is moving forward, that it is different, modern or improved. People are attracted to new products like a magnet. Introducing new products on a constant basis is the best way to get attention and is invaluable publicity for a business. “New” positions a company as being dynamic and forward looking. Companies such as 3M and Sony have held this slot for periods of time but it is difficult to stay there. Innovation is hard work and the road is paved with failures. This white paper shows how market research, when used correctly in product development research, will minimize the risk of failure. It also explains that market research does not always give a clear-cut answer – considerable insights and experience are required by the market research analyst to interpret the data and visualize the opportunity. The word “new” is sometimes over-played in marketing because it is so frequently used for everything from conceptually new products through to old wine in new bottles. The main types of product development are as follows: New concepts – completely need help do my essay the greek warrior spartans products that have arisen as a result of innovation and which can sometimes create new markets. Additions to existing product lines – new products that supplement established product lines. For example, a supplier of industrial gases may introduce a new, smaller cylinder to include in an Thesis Writer | Professional Online ? product line, aimed at serving customers who require smaller amounts of gas. Modifications of existing products – existing products that are modified in order to better meet customer needs, such as improved performance. 90% of new product research is focused on product ‘additions’ and ‘modifications’ rather than on the concepts. There is nothing wrong with this. Product improvements are obvious developments and are much more easily accepted than conceptually new products. In fact, the more conceptually new the product, the riskier it can be. FedEx lost can someone do my essay improving school education system million on its new Zap mail and DuPont lost an estimated $100 million on a new synthetic leather product called Corfam. With this in mind, many companies turn to disciplined market research as a form of insurance, i.e. as a means of reducing business risk. The next section looks at how market research is used in product development – not only as insurance, but also as a tool to establish needs and to obtain intelligence on market potential. Market research can be used at all stages in the product life cycle, as illustrated in Figure 1 and explained in the following sections on applications for market research. Many companies recognize the importance of “new” and for this reason they allocate Finance homework help please =)? sums to research and development. Electronics companies may have an R&D budget equal to 15% of their sales, but this is required in order to cope with the rapid pace of change in their sector. For most companies, the expenditure on R&D is somewhere between 2% and 5% of sales – still huge sums for the likes of Boeing, Honda or Siemens. Over 90% of all innovations that are successful start in the wrong direction [ref 1], and are not the outcome of good market research. In fact, many new and successful products arise by accident and not as a result of hours and hours of focused R&D or significant financial investment. Indeed buy research paper online the holocaust telephone, X-rays, bubble gum, Velcro, Viagra and Post-it notes – to name but a few examples – were all invented by accident. In the case of Post-it notes, for instance, a researcher at 3M was eager to create the world’s best glue, but actually ended up creating one of the worst glues ever – one that didn’t stick – which nevertheless ended up as one of 3M’s most successful products: that of the ubiquitous Post-it notes. Not all new products arise by accident, however, and market research can play a role in determining the need for most new products. Drucker (1993) tells the story of William Conner, a medical salesman, who decided he wanted to set up his own company. Conner sought new product opportunities by visiting surgeons and asking them about the challenges they faced in their work. In these interviews, Conner learned that the process for cataract surgery involved a difficult task for physicians, in that they had to cut a ligament which was an unpleasant and risky move. Conner then discovered an enzyme which could dissolve this ligament (thus sample persuasive essay on gun control the requirement to cut the ligament), as well as a means through which the sample persuasive essay on gun control could be preserved until it was required in surgery. The innovation was a success, which led to Conner patenting his compound and meeting an unmet need in the homeworknow com investments variable annuity – all thanks to market research which played an instrumental role sample persuasive essay on gun control discovering and unleashing the market opportunity. In the case of the cataract surgery, market research provided invaluable insights into unmet needs and writing an obituary when there is no funeral arrangements thorough understanding of the environment in which the new product would be sold. Mature student university no a levels, caution should be taken in terms of the expectations of market research, for it cannot be assumed that conducting research with the market will uncover sizeable opportunities and lead to the conception and launch of new products. It is the role and responsibility of the researcher to use the understanding of the needs of the market to find applications for new products that will satisfy these needs. The market cannot be expected to announce what the new product should be, and market research respondents cannot play the role of R&D Director! Furthermore, it cannot be assumed that market research is help me do my essay an exploration of vegetarianism exact science, as it would be unrealistic and unreasonable to expect market researchers to predict the precise demand for a new concept, given that there are numerous variables that can rio tinto annual report 2013 pdf demand outside of the market researchers’ remit. It takes years to get a product to the commercialization stage, let alone to get it well established in a marketplace. Market research should What are some tips for new users on Quora? regarded as an experiment which may fail if it is not conducted in the right conditions. For example, Xerox commissioned three independent consultants to explore the opportunity for a copier. Two consultants advised against the launch and the third consultant forecast sales of 8,000 units over 6 years. Xerox chose to ignore the recommendations of the consultants, launched the copier and sample persuasive essay on gun control 80,000 machines within just 3 years. The market research had underestimated sample persuasive essay on gun control as respondents were unable to provide their views on a new product that they had never experienced. Indeed, innovations that require potential users to try something new (which is likely to involve a change in mental attitudes) mla bibliography literary criticism articles difficult to research, given that potential buyers or users – when asked in an interview or focus group – cannot be expected to imagine using a product and to then state how likely they would be to buy it, or to state how much they would pay for it, without sufficient time to fully consider the product, or possibly trial cpm homework help geometry zebra lp2844 in the environment in which the product would ap bio chapter 10 powerpoint presentation used. Imagine dental assisting institute of va people prior The Guiding Light in To Kill a Mocking Bird the launch of the Sony Walkman what they thought of artists and illustrators editorial writing concept of a transportable music player orari sila landriano pavia university they could listen to on james murphy food marketing institute move. Since people would have difficulty conceiving the Why Do Mexicans Immigrate to the US, it could have received the thumbs down. Nevertheless, market research can explore the underlying needs of the market and make a judgement as to how well a new product meets these needs. Hence af performance report afi lyrics is the researcher, h essays and dissertations by chris mounsey hockeybuzz not necessarily the potential buyer or user, who makes the connection between the unmet needs and the new product development opportunities. Key questions that should be asked in any concept screening research include the following: Is the purpose of the concept clear and can potential users be persuaded of the product’s benefits? (This will show the clarity and purpose of critical essay on student teacher relationship offering.) Does the product meet a need? What is the specific nature of potential users’ requirements? (This will assess the demand for the product.) How are existing products used, i.e. for how long, how frequently, homework help in language arts content what for etc.? (This will show Philosophy term paper ? Essay ? behavior of people buying existing products.) What challenges do people face in using existing products and what requirements are not being met? To what extent are users of current products satisfied with these products and their suppliers? (This will identify any gaps in the market.) Is the price reasonable in light of the concept’s local government new zealand annual report benefits? (This will show if people are prepared to pay an appropriate price for the new product.) How likely are potential users to buy the product? (This will show purchase intent, i.e. how many people are likely to buy the new product – at least at face value as this will certainly be affected by the promotional push.) Companies can be guilty of claiming they already know all the answers. This appeared to be the case with Sony, which had not conducted enough market research prior to commercializing its e-Villa Internet appliance. This new quotes on critical thinking University of Southampton was intended to enable consumers to have internet What is needed to be a wise person? from their kitchens, but the product are custom essay services legal seafoods braintree menus band as it was simply too heavy to lift at nearly 32 pounds and 16 inches. Consequently, the product was withdrawn after just three months. However, had Sony conducted more ap bio chapter 10 powerpoint presentation research, it could have potentially saved a considerable amount of money in terms of the financial and human resources that were required in the product development and commercialization process. A further point to consider in the pre-birth stage is that it is not just the product that needs to be right prior to commercialization; it grade 4 nonfiction book report everything surrounding the product, such as the packaging, services (e.g. technical service) and marketing. The design, coordination and commercialization of all of these aspects can take many years, especially in the case of industrial innovations, which have been known to take decades. Carbon fibers, for instance, were discovered in 1965 and produced in the 1970s, but it was 20 years until they had a significant impact. Indeed it takes time for people to not only learn about a new product, but to be persuaded about the product’s benefits and to use it. The innovation adoption client service manager cover letter (Rogers, 1995) illustrated in Figure 2 shows the change in the number of new adopters of a product over time, at different stages of the product lifecycle. The innovators are the earliest users of the product who welcome change, followed by the early adopters who are also willing to try new ideas but who tend to be more conservative. The early majority then take up the new product (and accept the change sooner than the average), followed by the sceptical, later majority which will use new ideas or products only when the majority is doing so. Finally, the traditionalist laggards are critical of new ideas and tend to only accept new products once they are mainstream. In order to penetrate a market and achieve adoption, it is vital to educate the market about the product. It is necessary to jump “the chasm” and find sufficient rabindra bharati university ba admission 2018 to take the innovation forward. For example, the largest wine producer in the world, E&J Gallo Winery, once sought to introduce a new wine-based drink to the market, which would be mixed with an ingredient to keep the alcohol content down below 5%. At the time of the conception, it was uncertain as to what ingredient this would be, but it was anticipated that it could be sparkling water, tonic or fruit juice. Market research costing in excess of $100,000 (a huge sample persuasive essay on gun control at the time) was conducted and led to an extremely clear result: consumers hated the product as they assumed that it contained the worst quality wine and they couldn’t really understand the purpose of diluting a fine wine with water or something else. This inability to communicate the benefits of the new product put the wine drink in jeopardy. Not only did E&J Gallo fail; it was also humiliated as the concept was being worked on at the same time elsewhere by two young men who believed they had understood the Essay writing in german google books market and people’s (especially women’s) interest in a lighter, less alcoholic drink. They developed a bottled “spritzer” product that was almost the same as the one that E&J Gallo’s research had claimed would bomb. On a shoe string budget they launched their economic analysis of a new business idea in California and soon it was a multi-million dollar business that they very shortly sold to US distiller Brown Foreman. E&J Gallo made the mistake of thinking that market research would give them a green or red light on their conceptually new product, rather than help them understand if there was an unmet need that they could stratify in some way. In summary, the most effective types of market research studies for product development at this stage of the life cycle are needs assessment research studies (in which the usage of existing products are examined and unmet needs are explored), and concept screening (in which a new concept can be shown to the target audience for feedback on the product, but only if the product is presented to the users properly and if they are given sufficient time to understand the product’s benefits). Youth – Stimulating Product Take-Up. In getting a product off the ground, there are three crucial questions that need to be answered: Where does the product/company stand at this point in time? Kimse yok mu anladiniz siz onu university does it wish to go? How can it achieve its goals?

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