By Shana Lathan, Analytics Manager, Polaris Marketing Research

New Product Research

When launching a new product into the market, it is beneficial to conduct marketing research to help increase your chances of success. Some experts estimate that the new product success rate is no higher than 14 percent! This results in wasted time, money, and opportunity. New product research helps you identify unmet needs, screen concepts, and plan for marketing communications to support the successful launch of your product.

The new product development process has at least seven stages that all require information about the market and the target audience.

1. Opportunity Identification
   This is the stage to seek for holes or unmet needs in the market that could be opportunities. During this stage, it is helpful to conduct in-depth interview, focus groups, or short consumer surveys.
   

2. Concept Screening
   Now that there is an understanding of the unmet needs and underserved outcomes in the market, the next stage is product concept generation research to find potential product or feature concepts that could address that need. Internal teams should work to develop whole products or product features to meet these needs. These product and features should then go through product concept screening research for further testing, to determine which concepts have the highest probability of adoption and success. Use qualitative research preliminarily for product concept generation research and product concept screening research. Both in-depth interviews and focus groups are good vehicles for generating new product ideas and concept screening.

3. Concept Testing
   New product concept testing is critical before investing in the development. Now you have a great new product idea, but what is the potential market size? And will customers pay more for this product than for existing products addressing the same need? How strong are the individual component features? New product concept testing will help you with these critical questions. Conjoint analysis, MaxDiff analysis and other techniques allow you to segment the market to identify the high-potential target market. Understanding the value of features and benefits that have the highest appeal to your target market through new product concept testing allows you to craft the most effective marketing communications to facilitate adoption of new products.

4. Marketing Strategy Development
   This stage requires marketing research to help you decide on a plan for your marketing mix (the four P’s: Product, Price, Promotion, and Place). A survey is a good instrument to collect information to help make these decisions.

5. Product Development
   For many companies, the new product development process comes together in the test market research phase, which gives detailed and accurate information about potential marketing challenges and opportunities. Finding out how real consumers in real markets interact with real products and real competition through product market tests is key to successful new product development. For consumer products, test market research often consists of limited release, confined-home use studies. For business-to-business products, a beta test creates the same situation. Virtual reality, test kitchens, and other settings can also provide product market tests information.

6. Market Testing
   This stage is the last before the product enters the market. Market testing focuses on evaluating attitudes, awareness, and usage (AAU) of the product in test markets. Common techniques used are simulated store testing and controlled test marketing.

7. Product Introduction
   The new product development research process does not end with the test market. Product launch is a process that is filled with additional risk for the marketer. Using new product launch research to monitor the progress of your product launch can help you find additional opportunities and avoid pitfalls. Tracking awareness, trial, and adoption can help you monitor the progress of your new product and make course correction to maximize new product or service success.
   

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Shana Latham is the senior data analyst in the analytics department of Polaris Marketing Research Inc., where she is responsible for handling data manipulation tasks involved in survey research. She has a bachelor's degree in business from Georgia State University.