The hard truth about new product launches.

Most new product launches fail. According to Harvard Business School professor Clayton Christensen, 95% of the 30,000 new product introductions each year fail. No company is too big to fail. Remember New Coke? Mega organizations like Coca-Cola can afford the luxury of expensive misses. They even build it into their strategy. Jeff Bezos, the founder of Amazon, believes that failure is an essential part of the innovation process, and that what defines successful organizations is that they experiment more.

For smaller organizations, however, failed launches can cause irreparable harm. According to the U.S. Bureau of Labor Statistics, 20% of startups fail within their first two years. Another oft cited statistic is that 90% of startups ultimately fail, with data backing this from the global authority, Startup Genome.

A great idea doesn’t automatically guarantee in-market success. The market is dynamic, especially in these post-pandemic years with roller coaster inflation, supply chain shortages, and shifting consumer demands, making it dangerous to rely solely on your knowledge of what customers want. Bringing a new or revised product or service to market isn’t for the faint of heart. The best way to reduce risk is to ask the right questions to the right consumers before product launch. Here are some ways to collect deeper insights from your next concept test.

Would You Buy This…or Something Like This?

The backbone of traditional concept testing is purchase intent, typically measured on a Likert scale ranging from “definitely would” to “definitely would not.” While this data is certainly useful, it’s only part of the story. To understand why, consider the real-world decision-making process consumers go through when selecting products or services. Unless your concept is a revolutionary, new-to-the-world game-changer, consumers are likely already buying, or at least familiar with, similar options. Your concept is therefore evolutionary, a different spin on something they can buy today.

Imagine your survey ratings indicate a strong “definitely would buy” response to your evolutionary concept. So far, so good. But are customers telling you they would buy your specific concept, or something like it? Measuring comparative interest versus their usual brand, your current offering, and/or key competitors can go a long way in solving this question.

It can also be incredibly insightful to ask buyers how your concept fits into their purchase mix. A concept that is seen to replace their go-to product is the gold standard. However, in a category marked by variety-seeking, such as snack chips or single-serve yogurt, having your product included as part of their usual rotation might be the target.

Uniqueness questions are another way to delve deeper beyond purchase intent. While uniqueness shows the extent to which your product stands out from the herd, traditional uniqueness metrics generally lack any positive/negative understanding. Building in a comparative basis is necessary to gauge where you stand. Is this idea different-better than other products, or different-worse? If it’s not different at all but only about the same, you will need to work harder to better differentiate your benefits.

What’s the Problem?

Before beginning any testing, it’s crucial to understand what business actions are possible based on the outcome. Are product changes feasible based on consumer feedback, or must the product be exactly as described? This understanding will help frame the survey and the analysis appropriately.

Regardless, ensure you ask consumers about the elements that factored in their interest. There might be a shortcoming that can be modified, but perhaps there is missing or unclear information in the description about a benefit the product is already delivering, and you just need to articulate that more effectively.

What’s it Worth to You?

Successful launches deliver products with a solid value proposition. You need to gauge consumer perceptions to see if the proposed price of your concept aligns with its potential value to consumers. If the data doesn’t support your target price, you’ll need to understand whether the price is out of line with the perceived benefits, or if those benefits simply aren’t being communicated.

TMI

If your product will be supported with a robust advertising budget, then testing a detailed concept makes sense. In the market, customers will have all that information to make their decision. But if the ad budget is light (or nonexistent), then the product on-shelf or its package will need to do all the talking. The point is, for realistic projections, your concept should share only the information consumers will have when making their selection in the market. Enticing descriptions buyers will never see inflate projections.

Is 70% Good or Bad?

Understanding whether your results are good or bad becomes clearer by building an interpretive basis into your research. This might involve including your current product and/or a competitive product as study controls. Over time, a well-designed research program can provide norms or action standards that can be used as benchmarks on an ongoing basis.

Trial vs. Repeat

Finally, remember that even the best concept can only get your foot in the door. Concept testing measures trial. In use, your product needs to deliver on the promises of the concept, because most products succeed or fail based on repeat sales. Once your concept is optimized, it’s time to focus on product testing to ensure that repeat business.

Want to Learn More?

To learn more about using custom concept testing for your next project, reach out to Level 7. We’d love to hear from you.