The Dieringer Research Group, Inc. www.thedrg.com Confidential and Proprietary

The Dieringer Research Group, Inc. www.thedrg.com Confidential and Proprietary

We gather information to create and launch market research insights that enable better business decisions

How The DRG Can Improve Your Product Testing Program

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The Dieringer Research Group, Inc.

40 Years Strong | our experience…your success

Product Features Do Not Make Sense

Why Do Product Testing? To identify and solve some of these common problems…

It is estimated that over 45% of product development and refinement resources go to ventures that do not succeed, and 80-90% of new products introduced in the market fail.1 Some of the problems that can be prevented with testing include:

Example: McDonald’s Arch Deluxe In 1996, McDonald’s spent at least $150 million in advertising to promote this burger, targeting ‘sophisticated’ consumers. However, they soon learned that consumers looking for a higher-end burger do no typically go to McDonald’s.

Example: Maxwell House Ready-to-Drink Coffee Maxwell House promoted the convenience of this pre-brewed product. But coffee drinkers preferred to freshly brew their coffee, even if it was slightly more work.

Example: Clairol’s ‘Touch of Yogurt’ and ‘Look of Buttermilk’ Shampoos Many consumers did not like the idea of washing their hair in yogurt. And Clairol’s buttermilk Shampoo left people wondering ‘What exactly is the look of buttermilk and why do I want it?’

Poor Concept

Product Does Not Fit the Market

1 “Doing it Right, Winning with New Products” by The Product Development Institute, 2006

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40 Years Strong | our experience…your success

Other Common Problems Include…

Outdated Product(s)

• Example: Polaroid Cameras

• While at one time very profitable, Polaroid cameras lost market share due to not keeping up-to-date with technology

• With the average product lifespan shrinking 400% within the past 50 years, companies cannot rely on existing product offerings1

Ineffective Packaging

• Example: Kellogg’s Breakfast Mates

• Similar to Lunchables, this product packaged together everything children needed to prepare their own breakfast: a small box of cereal, milk and a spoon. A television ad featured parents peacefully sleeping while their children made breakfast

• The problem was the packaging was too difficult for a young child to open!

Confusing Brand Name

• Example: Frito Lay Lemonade

• Just because a current brand is well-known, does not necessarily mean it can naturally be extended to other product categories

• While it is great to leverage brand awareness, it sometimes does not make sense. For example, consumers did not associate a refreshing glass of lemonade with the brand of their potato chips

1 “Doing it Right, Winning with New Products” by The Product Development Institute, 2006

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40 Years Strong | our experience…your success

The Importance of Product Testing

There is no guarantee that a product is always going to succeed However, well-designed product testing research can aid in identifying these problems early on before products fail in the marketplace

With the growth of social media, more

users are sharing their product experiences (both positive and negative) with others. With this trend, it is even more important to identify and correct any concerns as early as possible, before the reputation of your product and brand is affected.

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40 Years Strong | our experience…your success

100 Days Until Product Launch!

ADD

YOUR

TEXT Do you know if

your product will stand out in the marketplace?

The goal is to ensure you get the most value from your research investment and you have the market insights you need to make product decisions with confidence.

The DRG customizes each study to our client’s business needs, product

category and target market, helping our clients choose the right path!

There is no “one size fits all” product testing research study

Product Testing Research Considerations

• Where are you in the product development process?

• What type of information are you looking for?

• What are your specific goals and objectives?

Business Goals and Information

Needs

Product Type

Target Market

• What are the characteristics and features of your product?

• How does the user interact with your product?

• Who is your target market?

• What are the lifestyle characteristics of your potential buyers?

• Are there specific segments or groups you would like to compare?

Some of the questions we ask our clients when designing and implementing product testing research include:

Following is more detail on a few of these considerations. Contact The DRG for additional information!

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The Dieringer Research Group, Inc.

40 Years Strong | our experience…your success

Where are you in the product development process?

The DRG works with clients to understand where they are in development and tailors the research design accordingly.

Exploration / Investigation

• Explore initial impressions, likes and dislikes; Investigate competitors’ offerings as well as internal customer data to uncover any unmet needs

• Research Techniques: Qualitative focus groups, in-depth interviews and/or secondary research

Development & Refinement

• Determine ideal product features and benefits. Also start planning name, logo, packaging, pricing and key selling features

• Research Techniques: Quantitative survey often with conjoint, MaxDiff or other trade-off technique. Web surveys are ideal for showing pictures/video of your product

Testing

• Test one or several product prototypes with potential buyers prior to finalizing the product; product testing can begin as soon as a prototype is developed

• Research Techniques: CLTs or in-home use tests conducted to evaluate usability and perceptions of target market; More testing is also now conducted via online and mobile techniques (e.g. online journals where pictures/video can be posted of the products being used)

Validation

• Confirm and validate the product prior to full-scale launch. Develop marketing plan and go-to-market strategy

• Research Techniques: Surveys often conducted to obtain feedback of final product as well as positioning, taglines, ads or other communications used to sell the product

Launch

• Bring product to first test market(s). Full-scale launch after gathering feedback from test markets.

• Research Techniques: Pre and post-launch interviews and/or surveys with test and control groups help measure effectiveness of product and marketing, and identify any potential issues early

Even products already on the market are continuously going through this process, as companies need to constantly be evaluating modifications and improvements to ensure their product’s continued success

Business Goals and Information

Needs

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40 Years Strong | our experience…your success

What type of information are you looking for – Qualitative or Quantitative?

Qualitative

Often conducted when you are evaluating a few preliminary concepts and have done little

previous research

Example Applications:

- Brainstorming/refining ideas and concepts

- Exploring how people feel about a product or concept

- A first step to identify initial reactions before making the decision to invest further

Quantitative

Typically used when you already have products or concepts developed to test but you want to understand

market reactions prior to launch

Example Applications:

- Measuring how many potential buyers feel a certain way toward a product or concept

- Testing already-known hypotheses or solutions to a potential issue/ concerns

- Comparing attitudes and perceptions of different segments or groups

The most comprehensive

approach combines

qualitative and quantitative

methodologies

Business Goals and Information

Needs

This can even be done in the same project. For example, you can quantitatively test a food product in CLTs/taste tests but

still ask participants a few qualitative questions, incorporating a short open-end discussion about the product to provide more

insight and uncover the reasons behind their responses

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40 Years Strong | our experience…your success

Are you considering a feature change in an existing product? (Comparing your existing product to a

new prototype)

• Use sequential monadic testing, which involves each participant testing more than one product

• Have participants test both the current product and the new product so they can identify preferences

Do you have a few options developed and would like to test which is best to launch?

• If you have quite a few options, a monadic testing strategy may work best, where each participant only tests one product option

• Make sure you have a large enough sample size for each product so comparisons are possible

• After your final product is narrowed down to 2-4 options, it may then be beneficial to have participants try multiple products, so they can make direct comparisons

Are you comparing your product to competitors’

product offering?

• Testing against competitors provides an understanding of your product’s strengths and weaknesses, as well as insight on where to focus future product development

• Competitor comparisons also help you decide how to position and promote your product

• Keeping the brand concealed from participants is important so they can make unbiased evaluations

What are your specific goals and objectives?

For example…

Business Goals and Information

Needs

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40 Years Strong | our experience…your success

Where the Product is Purchased and Used • If evaluating packaging or appeal of your product compared to competitors’, you may

want to consider in-store intercepts or ethnographies

• Can also simulate a store shelf in a CLT or focus group setting, as well as online in a web survey

• When evaluating usability and specific features, it may be ideal for participants to test the product where they typically would use it (home, work, etc)

What are the characteristics and features of your product?

Product Complexity Complex products may be best tested using in-person methods:

• IDIs, focus groups or CLTs allow you to demonstrate how to use the product

• For example, while a car or lawn mower is easy to use, you may want to explain and demonstrate the specific features that make your product unique

• You can also then see first-hand where participants are having difficulty

• Home Use Tests (HUTs) may still be used to test complex products. But you may want to provide instructions/demonstrations when the product is picked up or delivered

Product Type • Consumer packaged goods are commonly tested through home use tests

• Food/beverage products are often evaluated in central location tests / taste tests

• Large durable goods are often tested using in-depth interviews, focus groups, central location tests or product clinics (more difficult for testers to take the product home and use)

• Services may be tested via mystery shopping or ethnography. Online journals may also be considered, where users can post comments/pictures of their experience

Product Type

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40 Years Strong | our experience…your success

How does the user interact with your product?

Frequency of Use Daily-Use Product

• Participants can test multiple products and make effective comparisons when testing products that are used every day, such as diapers, toothbrushes, shampoo, etc.

Occasional-Use Product

• Participants may need to be limited to one test product when the product is only used occasionally (e.g. hair dye)

User Interaction • Consumers sometimes need to interact with a product for a period of time before they

can develop a complete opinion or preference

For some products, participants should have the opportunity to use the product for at least 1-2 weeks so they are comfortable with all the features (e.g. smart phone)

In this case, a longer-term home-use test or online journal/community may be the best methodology

This works well when you want to test many product attributes or if you want feedback on the overall product experience

• However, if the product can be experienced with 1 use (e.g. a food or beverage), testing can likely be done in a day or less (focus groups, CLTs, taste tests)

There are also some products where testing in a one-on-one setting (IDI) may be more appropriate, as you do not want participants’ experiences influenced by others

Product Type

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40 Years Strong | our experience…your success

Who is your target market?

Anyone who would potentially purchase and use your product should be considered for testing. But you still may want to consider narrowing your target or oversampling specific segments.

• Overall, testing the product among a wide range of participants helps you understand and segment your target market(s)

This is helpful when you are introducing a new product and unsure exactly who your target market is

• But exclude those that realistically would never (or rarely) use your product

For example, a food product designed for children’s lunches/snacks should be primarily tested among households with children

• If your product/brand is already on the market and you are testing changes, remember to include both current purchasers and non-purchasers!

Assuming you want to increase your market share and attract new buyers, do not limit participants to just existing buyers

Target Market

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Consider the lifestyle characteristics of the type of users you are trying to target for your product when designing your methodology and recruitment plan. For example:

What are the lifestyle characteristics of your potential buyers?

Target Market

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40 Years Strong | our experience…your success

Are there specific segments or groups you would like to compare?

• Levels of experience with the product, including:

Frequent users who may even influence others to purchase

Occasional users

Non-users (but would consider using in the future)

• Brand preferences, including: Loyalists –purchase a specific brand exclusively;

may want to recruit a few loyal to your brand and those loyal to your key competitors

Buyers – purchasers of your brand but also occasionally buy other brands as well

Switchers – purchasers who are not brand loyal and typically base their purchase decision on price, what’s on sale, etc

• Demographics You may also want to compare age, gender,

ethnicity, geography, income, etc

Target Market

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The Dieringer Research Group, Inc.

40 Years Strong | our experience…your success

Benefits of Product Testing Customized to Your Business Needs

Higher Product Satisfaction and Loyalty • Keep current

purchasers • Grow

recommendations and referrals

A Better Defined Value Proposition • Well-defined,

unique product benefits

• Improved marketing/sales strategy

Improved Competitive Position • Maintain and grow

your market share

Stronger Brand Equity • Positive reputation in

the marketplace

Increased Profits! • Higher Sales/Revenue • Maximize Product

Development/ Refinement Budget (You will know early on which ideas are more likely to succeed)

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The Dieringer Research Group, Inc.

40 Years Strong | our experience…your success

P.S. Remember to Test Early and Often!

• Many make the mistake of testing once early in development, then making changes and going straight to market

• Others make the mistake of waiting to test until right before launch

• The DRG recommends testing early and often!

Ongoing testing should be incorporated into

your product development plans and budgets. For each wave of product

changes, try to conduct at least a few quick tests with

potential users.

Tips to Save Time and Money for Ongoing Testing

• Have the same participants evaluate product prototypes This saves on recruiting expenses

and time Participants will also then be able

to tell you whether they consider your updates to be an improvement over the previous version they tested

You can still add a few new participants later in development to get a fresh perspective

• Consider web surveys for some of your testing While HUTs or CLTs may be ideal,

a quick web survey showing pictures/video of the product can also provide valuable insights

Ongoing testing can save your product development team time and money. You will spot potential problems earlier, and you won’t be spending resources on product “improvements” that your target market isn’t interested in

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The Dieringer Research Group, Inc.

40 Years Strong | our experience…your success

The DRG can be your single point of contact for nationwide product testing efforts

• While based in the Milwaukee area, we coordinate with partners throughout the US to field in-person research in other regions

• However, all projects are centrally managed from our headquarters

• When working with partners, our Project Managers will often travel to other US regions to train interviewers or oversee fieldwork in other cities, to ensure consistency in data collection

• All data is centrally processed and reviewed at The DRG before sending to our clients, ensuring the information we provide meets our high quality standards

The DRG’s Milwaukee location is also a great place to conduct

product testing!

Milwaukee’s slogan, “Genuine American,” reflects the city’s all-American culture. With over two million area residents and a wide range of industries, Milwaukee is an ideal market to conduct research. Focus groups, IDIs and CLTs can be held at The DRG Focus Center, designed and built in 2010.

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The Dieringer Research Group, Inc.

40 Years Strong | our experience…your success

For more information, please contact:

The Dieringer Research Group, Inc.

E-mail: sales@thedrg.com Phone: 888-432-5220

www.thedrg.com