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    Product Concept Evaluation System/overview: New Product Development 23C79000, 24.9.2013 Prof. Jaakko Aspara

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    Jacqueline Low
    This document provides an overview and discussion of concept evaluation in new product development. It discusses: 1) The concept evaluation system, which refers to evaluations that take place throughout the product development process, including identifying opportunity areas, generating concepts, and developing and launching products. 2) The dedicated concept evaluation stage involves initial concept testing to select the most promising concepts and eliminate the least feasible, before advancing concepts to development. 3) Guidelines for concept testing include preparing clear concept statements, selecting appropriate respondent groups, and testing format, procedure, and findings to help improve concepts based on user feedback.

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    Product Concept Evaluation System/overview: New Product Development 23C79000, 24.9.2013 Prof. Jaakko Aspara

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    Jacqueline Low
    38 views12 pages
    This document provides an overview and discussion of concept evaluation in new product development. It discusses: 1) The concept evaluation system, which refers to evaluations that take place throughout the product development process, including identifying opportunity areas, generating concepts, and developing and launching products. 2) The dedicated concept evaluation stage involves initial concept testing to select the most promising concepts and eliminate the least feasible, before advancing concepts to development. 3) Guidelines for concept testing include preparing clear concept statements, selecting appropriate respondent groups, and testing format, procedure, and findings to help improve concepts based on user feedback.

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    This document provides an overview and discussion of concept evaluation in new product development. It discusses: 1) The concept evaluation system, which refers to evaluations that take place throughout the product development process, including identifying opportunity areas, generating concepts, and developing and launching products. 2) The dedicated concept evaluation stage involves initial concept testing to select the most promising concepts and eliminate the least feasible, before advancing concepts to development. 3) Guidelines for concept testing include preparing clear concept statements, selecting appropriate respondent groups, and testing format, procedure, and findings to help improve concepts based on user feedback.

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    38 views12 pages

    Product Concept Evaluation System/overview: New Product Development 23C79000, 24.9.2013 Prof. Jaakko Aspara

    Uploaded by

    Jacqueline Low
    This document provides an overview and discussion of concept evaluation in new product development. It discusses: 1) The concept evaluation system, which refers to evaluations that take place throughout the product development process, including identifying opportunity areas, generating concepts, and developing and launching products. 2) The dedicated concept evaluation stage involves initial concept testing to select the most promising concepts and eliminate the least feasible, before advancing concepts to development. 3) Guidelines for concept testing include preparing clear concept statements, selecting appropriate respondent groups, and testing format, procedure, and findings to help improve concepts based on user feedback.

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    2013-09-24

    Product concept evaluation system/overview


    New Product Development 23C79000, 24.9.2013 Prof. Jaakko Aspara

    PHASE 1. Opportunity area identification

    OUTCOMES

    Some broad opportunity areas and strategic direction for NPD (including broad market/use context targeted) 2. Concept a) User generation problem identification b) Studying other info and product idea sources c) Product concepting 3. Concept evaluation a) Initial concept evaluations/ testing

    Multiple user problems identified (within selected market/use context) Relevant user problems selected

    Initial prod. concepts created (addressing selected user problems)

    Best product concepts selected for full screen (least feasible eliminated) b) Full screen (and sales/ financial forecasting) Best product concepts selected for actual development (least feasible eliminated) 4. Actual /detailed development 5. Launch (of the new product[s] to the market

    2013-09-24

    Evaluations?
    Evaluation = Is (idea) X good or bad? How good or bad (an idea) X is? Especially: How feasible is X (a) commercially and (b) technically? It is worth noting that evaluations happen throughout the process of new product development.
    In the (1) opportunity identification stage, the selection of opportunity areas on which to focus requires at least some evaluation of various opportunities that exist. In (2) product concept ideation/generation, ideation always involves some simultaneous evaluation (even just knowing that now I have an idea means that you have already evaluated the idea at least a bit) In (4) actual development and launch stages you may evaluate different alternative designs for the product and alternative launch plans and strategies.

    The concept evaluation system refers to the various evaluation tasks and techniques undertaken throughout the whole product development process.C

    Evaluations? The (3) Concept Evaluation stage


    However, while some evaluation of ideas and concepts occurs throughout all the stages of the process, firms should also have a dedicated (3) Concept Evaluation stage in product development.
    after the (2) Concept Ideation/Generation stage, and before putting any of the product ideas/concepts into Concept evaluation should (4) Actual Development stage involve some feedback from Main reasons users/customers. to increase the likelihood that the product concepts to be developed are desirable to the users/customers to prevent bad ideas and concepts from entering the actual development stage which is often very costly
    First, rough evaluations of commercial and technical feasibility based on (1) user/customer feedback and (2) firms internal reviews.

    2013-09-24

    Agenda
    1. Overview of Concept Evaluation System
    i.e., some evaluation considerations that are relevant to all the stages of the product development process

    2. Concept Evaluation Process stage (3)


    (3a) Concept Testing (3b) Full screen (will be dealt with next week)

    1. Overview of concept evaluation system

    2013-09-24

    The (Concept) Evaluation System

    Figure 8.1

    8-7

    Risk/Payoff Matrix at each evaluation?


    Decision A Stop the Project Now AA B Continue to Next Evaluation BA

    A. Product would fail if brought to market B. Product would succeed if brought to market

    AB

    BB

    Cells AA and BB are correct decisions. Cells BA and AB are errors, but they have different cost and probability dimensions.
    8-8

    2013-09-24

    Planning the Evaluation System: Four aspects


    Rolling Evaluation (tentative nature of new products process) Potholes People Surrogates

    8-9

    Rolling evaluation (or, "Everything is tentative")


    Project is assessed continuously (rather than a single Go/No Go decision) Financial analysis also needs to be built up continuously
    Not enough data early on for complex financial analyses Run risk of killing off too many good ideas early

    Marketing philosophy begins early in the process


    Product concepts ideated in the first place to address user problems and needs (i.e., the benefit) Early user/customer feedback on the concepts.

    Key: new product participants should avoid to black-and-white "good/bad" mindsets, avoid premature closure

    8-10

    2013-09-24

    Potholes
    Know what the really damaging problems or critical drivers are for your firm and focus on them when evaluating concepts. Example: Campbell Soup focuses on:
    1. Manufacturing Cost 2. Taste

    8-11

    People
    Proposal may be hard to stop once there is buy-in on the concept. Need tough demanding hurdles, especially late in new products process. Personal risk associated with new product development. Need system that protects developers and offers reassurance (if warranted).
    Failing sometimes should be considered OK. (Otherwise people just make safe decisions and concepts of low innovativeness).

    8-12

    2013-09-24

    Surrogates
    Surrogate questions can give clues to the real answer (before/when we cannot yet know the real answer).

    Real Question Surrogate Question Will customers prefer it? Did they keep the prototype product we gave them after the concept test? Will cost be competitive? Will competition leap in? Will it sell? Does it match our manufacturing skills? What did they do last time? Did it do well in field testing?

    8-13

    2. Concept evaluation process

    New Product Development 23C79000, 25.9.2012 Professor Jaakko Aspara

    2013-09-24

    Agenda
    1. Overview of Concept Evaluation System
    i.e., some evaluation considerations that are relevant to all the stages of the product development process

    2. Concept Evaluation Process stage (3)


    (3a) Concept Testing (3b) Full screen (will be dealt with next week)

    PHASE 1. Opportunity area identification

    OUTCOMES

    Some broad opportunity areas and strategic direction for NPD (including broad market/use context targeted) 2. Concept a) User generation problem identification b) Studying other info and product idea sources c) Product concepting 3. Concept evaluation a) Initial concept evaluations/ testing

    Multiple user problems identified (within selected market/use context) Relevant user problems selected

    Initial prod. concepts created (addressing selected user problems)

    Best product concepts selected for full screen (least feasible eliminated) b) Full screen (and sales/ financial forecasting) Best product concepts selected for actual development (least feasible eliminated) 4. Actual /detailed development 5. Launch (of the new product[s] to the market

    2013-09-24

    Concept Evaluation stage


    The sub-stage of (3a) Concept Testing

    Figure III.1

    The sub-stage of (3b) Full Screen

    8-17

    General purposes of concept tests


    To identify very poor concepts so that they can be eliminated. To estimate (at least crudely) the sales or trial rate the product would enjoy (buying intentions, early projection of market share). To help develop the idea (e.g. make tradeoffs among attributes). The Concept Tests should focus especially on getting users/customers evaluations (and feedback) of the concepts.

    9-18

    2013-09-24

    Procedure for a concept test


    Prepare concept statement
    Clarify specific purposes Decide format(s) Select whether commercialized (advertisement/promotion-like) format or not Determine whether to include price(s)

    Select respondent type(s) Select response situation Define the interview Conduct trial interviews Interview, tabulate, analyze

    9-19

    What is a product concept statement?


    A statement about anticipated product features (form or technology) that will yield selected benefits relative to other products or problem solutions already available. Example: A new electric razor whose screen is so thin it can cut closer than any other electric razor on the market. Recall the importance of getting responses to product concepts and not simply vague ideas (Chapter 4).
    The concept must state
    Benefit & technology OR Benefit & form/features OR Benefit & form/features & technology

    See the first weeks lectures


    9-20

    10

    2013-09-24

    Some key issues in concept testing


    Concept statement: narrative, drawing, model? Respondent group: Lead users? Heavy users? Typical users? Response situation: Where? How?
    E.g., in person at mall vs. by mail vs. online

    Interviewing sequence: Believable? Important? Interesting? Would it work? What problems do they see? Would they buy? Test procedure, change and implement, study findings.

    9-21

    Concept test Sketch example

    Figure 9.2

    9-22

    11

    2013-09-24

    Benefit segmentation in swimsuit market


    Remember that the evaluations from the Concept Test may depend on which segment the users that you study/interview belong to.
    x x xx x x x x x x x x x Segment 2 x x xx x x x x x x xx x x
    Segment 3

    Figure 9.3

    It is often worthwhile to define the segments before the concept tests and target users from the right segment. Alternatively, the results from the concept test (i.e. differing evaluations by different kinds of users) can also be used to identify different segments.

    x x x x x x Segment 1 x x x xx x x x Fashion x

    9-23

    Concept testing cautions and concerns


    Concept tests may be especially unreliable If the prime benefit is a personal sense (aroma, taste), concept testing may be difficult
    Especially, because concepts that are in the format of verbal descriptions cannot well describe sense factors (e.g., taste)

    If the concept involves new art and entertainment. If the concept embodies such a radically new technology that users have very hard time imagining. If customers simply do not know what problems they have.

    9-24

    12

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