5 Ways to Improve Product Development with Market Research
Tapping into consumer insights at five stages of concept and product development significantly reduces risks and improves the odds of gaining market share.
Identifying quantitative and qualitative consumer insights throughout the concept and product development process identifies problems people genuinely need to solve, and actual gaps and opportunities in the marketplace.
The odds of gaining market share with a new product or service improve exponentially with market research. In fact, four out of every five successful industrial innovations are inspired by consumers according to a Market Week report.
Market Research at five key stages improves the product development process:
- Concept Development: Identify Consumer Wants, Needs and Priorities
- The Business Case: Identify Risks and Define Market Share
- Product Development: Identify Drivers and Improve Product Performance
- Product Launch: Optimize Product Positioning, Pricing and Promotion
- Product Life Cycle: Improve Product Performance and Market Share
Concept Development: Identify Consumer Wants, Needs and Wishes
Listening to consumers provides a wealth of insights to improve product performance, and often identifies opportunities to innovate and create new concepts or product lines to address a genuine need in the marketplace.
Market research before, during and after concept development explains consumer behavior, and taps into insights from actual people about:
- Lifestyle and Values
- Usage Behavior, Wants, Needs and Wishes
- Personality, Preferences, Interests, Likes and Dislikes
- Product or Service Consumption Behavior
- Media Consumption Behavior
- Price Perceptions and Purchase Intent
- Shopping Behavior and Spending Habits
The Business Case: Identify Category Drivers, Opportunities and Risks
Market research and concept testing significantly reduce risks associated with new product development by evaluating the competitive landscape and viability of a concept based on feedback from actual consumers.
Testing a concept with consumers using a simple prototype or pictorial mockup is an economical way to make the business case for new product development:
- What actual consumer problem does our product or service solve, and is there an existing category for this concept?
- How big is the problem, and what is the market size and potential sales volume?
- Who needs to solve this problem, and how competitive is the market?
- What do consumers say they want or need in order to resolve this problem, and what will sway them to buy our solution?
- How are consumers trying to solve this problem now, and what is the minimum and maximum amount they are willing to pay for a different solution?
- How much will it cost to develop and launch this product, and what is our projected break even point?
- Do we have the financial, technical and human resources to go to market with this product, and support growth if it takes off?
Product Development: Identify Drivers and Improve Product Performance
Market research during product development can identify and address bugs, errors and performance issues that frequently delay or derail product launches. Consumer insights can reveal ways to differentiate a product or service from the competition, and fix things that annoy, frustrate or confuse people.
Testing prototypes before going into production can improve the product or service, and determine if there’s a viable market for a new product or service:
- Does the product meet the needs and wants of consumers?
- Who will buy our product, and at what price?
- Are consumers using the prototype the way it was intended, or are they coming up with work arounds?
- What problems are consumers encountering with the prototype, and what can we do to make the product or service more relevant to consumers?
- What will sway consumers to buy our product or service and differentiate our solution from the competition?
- What does the consumer shopping category look like in this brand category, and what marketing mix will reach the target audience?
Product Launch: Optimize Product Positioning, Pricing and Promotion
Ultimately, a successful product launch hinges on consumer behavior. Businesses gain a competitive edge when they rely on market research and consumer insights to define product positioning, pricing and promotion strategies.
Market research before a new product launch answers key questions that can prevent delays and optimize marketing strategies:
- Will our target audience buy our product or service at our price point?
- Do consumers easily grasp the problem this product or service solves, and use it as intended? Or, are additional improvements or consumer education required to prepare for the product launch?
- Do we have research to substantiate our product claims, and do consumers believe our labeling is accurate and relevant?
- Does our brand ideology and company reputation align with target consumers’ values and priorities?
- Do tests indicate our packaging, messaging, ads and marketing will inspire consumers to buy our product or service online and in stores?
- Do trials indicate consumers are happy with our customer service and delivery methods?
Product Life Cycle: Improve Product Performance and Boost Market Share
Listening to customer feedback is one of the most effective ways to continue to evaluate and improve a product throughout its life cycle. In fact, a recent study by Hanover found 68% of companies increased sales revenue , and improved customer retention rates by analyzing customer experiences and evaluating customer satisfaction.
Market research provides insights about consumer behavior to support strategic decisions, and opportunities to innovate and improve product lines:
- What are our customers’ priorities, and are we exceeding their expectations? What can we do better?
- What problems are consumers encountering, and what can we do to resolve their issues?
- Are people coming up with workarounds when they use our product? What can we do to address their wants and needs?
- Is there a need or opportunity to introduce a different product or service to address this need?
Market Research Methodologies to Gain Viable Consumer Insights
First-hand knowledge from consumers provides inspiration for compelling concepts and new products that people already want to buy.
Research methods that can be impactful for new product development are:
Individual or group discussions are designed to gain consumer insights for:
- New product usage/tasting
- Concept exploration and prototype testing
- Advertising and copy evaluation
- New packaging exploration
- Marketing communication evaluation
Shop-alongs are designed to understand category shopping behavior
- Gain package design feedback about shelf pop, readability and competitor/category analysis
- Understand shelf placement and point of sale opportunities
- Determine merchandising vehicle impacts
Ethnographic approaches such as in-home videos, lifestyle immersion and friendship networks are designed to:
- Understand target consumer needs, wants and desires
- Uncover consumer attitudes and usage behavior
- Test products and packaging (short and long-term use)
- Test ad campaigns and develop effective messages
- Support new product development
- Support website development
Virtual and mobile research approaches like group discussions, bulletin boards, panels and digital diaries support:
- Concept evaluation and development
- Product testing (short and long-term use)
- Purchase considerations
- Ad campaign development and message testing
- Website development and usability testing
- Attitudes, usage and behavior tracking
- Traditional qualitative lead-in or follow-up surveys
Consumer Forums provide fast and continuous consumer opinions from specialized groups like:
- General population forums screened based on usage behavior
- Trend setter forums with early adopters
- Brand-lover forums with consumers who already use products and services
Looking for Consumer Insights to Improve Concept & Product Development?
Insights In Marketing consultants are strategic partners who deliver in-depth consumer research and actionable marketing insights to inspire innovation and growth. Our team has decades of client and supplier side research experience, and our marketing expertise spans across various industries and consumer segments.