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Chapter 8Concept Testing

MSE-415: Product DesignLecture #5

MSE-415: Product DesignLecture #5

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Lecture Objectives:Lecture Objectives:

• Discuss structured methods for evaluating concept designs.• Homework #5 Due.

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Concept SelectionConcept Selection

•Concept testing is part of the overall concept development phase.

Perform Economic Analysis

Benchmark Competitive Products

Build and Test Models and Prototypes

IdentifyCustomer

Needs

EstablishTarget

Specifications

GenerateProduct

Concepts

SelectProduct

Concept(s)

Set Final

Specifications

PlanDownstreamDevelopment

MissionStatement Test

ProductConcept(s)

DevelopmentPlan

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Concept testing

Concept testing

•Concept testing is the attempt to predict the success of a new product idea before it is marketed. It usually involves getting people’s reactions to a statement describing the basic idea of the product.

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Concept Testing is Used for Several Purposes

Concept Testing is Used for Several Purposes

•Go/no-go decisions•What market to be in?•Selecting among alternative concepts•Confirming concept selection decision•Benchmarking•Soliciting improvement ideas•Forecasting demand•Ready to launch?

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Concept Testing ProcessConcept Testing Process

1. Define the purpose of the test2. Choose a survey population3. Choose a survey format4. Communicate the concept5. Measure customer response6. Interpret the results7. Reflect on the results and the process

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Concept Testing ProcessConcept Testing Process

1. Define the purpose of the test

Explicitly articulate in writing the questions that the teamwishes to answer with the test.

Primary Questions:•Which of several alternative concepts should be pursued?•How can the concept be improved to better meet customerneeds?•Approximately how many units are likely to be sold?•Should development be continued?

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Concept Testing ProcessConcept Testing Process

2. Choose a survey population

Choose a survey population which mirrors the target market in asmany ways as possible.

But how big the population?

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Survey Population Size

Survey Population Size

Factors favoring a smaller sample size:

•Test occurs early in concept development process.•Test is primarily intended to gather qualitative data.•Surveying potential customers is relatively costly intime and/or money.•Required investment to develop and launch the productis relatively small.•A relatively large fraction of the target market is expectedto value the product.

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Survey Population Size

Survey Population Size

Factors favoring a larger sample size:

•Test occurs later in concept development process.•Test is primarily intended to gather quantitative data.•Surveying potential customers is relatively fast and inexpensive.•Required investment to develop and launch the productis relatively high.•A relatively small fraction of the target market is expectedto value the product.

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Survey Population Size

Survey Population Size

How Big?

iPhone

Chewing Gum

Aircraft Carrier

Car

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Concept Testing ProcessConcept Testing Process

3. Choose a survey format

Typical Survey Formats

•Face-to-face interaction•Telephone•Postal Mail•Electronic Mail•Internet

Avoid inherent bias. An internet survey would be a bad choicewhen surveying a product geared for non-technical customers.

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Concept Testing ProcessConcept Testing Process

4. Communicate the concept•Verbal Description•Sketch•Photos/Rendering•Storyboard•Video•Simulation•Interactive multimedia•Physical appearance models•Working prototypes

Make sure you communicate the concept in a way that is appropriatefor the survey.

Example: You can’t show a video via a telephone survey!

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Concept Testing ProcessConcept Testing Process

4. Communicate the concept - Issues•Description of concept should the information the userwill most likely consider when making a purchase.•Do not include price unless very high or very low.

•WHY?•Present several concepts if possible.

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Mail Concept test - sketch

Mail Concept test - sketch

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Mail Concept Test -- Verbal Description

Mail Concept Test -- Verbal Description

• Here is a tasty, sparkling beverage that quenches thirst, refreshes, and makes the mouth tingle with a delightful flavor blend of orange, mint, and lime. It helps adults (and kids too) control weight by reducing the craving for sweets and between-meal snacks. And, best of all, it contains absolutely no calories. Comes in 12-ounce cans or bottles and costs 60 cents each.

• 1. How different, if at all, do you think this diet soft drink would be from other available products now on the market that might be compared with it?

• Very different ( ) ( ) ( ) ( ) ( ) ( ) Not at all different

• 2. Assuming you tried the product described above and liked it, about how often do you think you would buy it?

• More than 1X a week ( ) ( ) ( ) ( ) ( ) ( ) Would never buy

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Concept Testing ProcessConcept Testing Process

5. Measure Customer Response• Concept testing can measure

• Choice between alternative concepts (early in design)

• Ways to improve concept

• Purchase intent scale1. Definitely would buy2. Probably would buy3. Might or might not buy4. Probably would not buy5. Definitely would not buy

Example Survey, page 156.

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Concept Testing ProcessConcept Testing Process

6. Interpret Results• Concept selection

• Relatively easy, which did the respondents indicatethey liked better?

• Demand estimation• What is the estimated demand of the product after launch?

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Concept Testing ProcessConcept Testing Process

Demand Estimation• Durables

• Products that are purchased one time. Negligible repeat purchaserate. Examples?

• Consumer goods• Goods that have high repeat purchases. Examples?

Q = N x A x P•Q = sales (annual)•N = number of (annual) purchases•A = awareness x availability (fractions)•P = probability of purchase (surveyed)

= Cdef x Fdef + Cprob x Fprob

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Concept Testing ProcessConcept Testing Process

Demand Estimation

Q = N x A x P•Q = sales (annual)•N = number of (annual) purchases•A = awareness x availability (fractions)•P = probability of purchase (surveyed)

= Cdef x Fdef + Cprob x Fprob

Fdef – Fraction of respondents indicating they would definitely purchase.Fprob – Fraction of respondents indicating they would probably purchase.Cdef and Cprob – Calibration constants usually established by experience of company based upon similar past products.

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Concept Testing ProcessConcept Testing Process

7. Reflect on Results1. Was the concept communicated in a way that is likely

to elicit customer response that reflects true intent?

2. Is the resulting forecast consistent with observed salesrates of similar products?

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Next WeekOctober 24, 2007

Next WeekOctober 24, 2007

• Homework No Homework Prepare for Mid-Term covering Chapters 1 – 8, 16. Prepare for Mid-Term presentation.