Innovations in Product and Service Development Research

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Chadwick Martin Bailey's Rich Schreuer and Amy Modini share best practices and case studies from their years conducting product and service development research across verticals.
You'll learn:
* Which of the latest trade-off techniques work best for product and service development research
* The role of brand in product and service development research
* Steps to ensure the information is used once a project is complete

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  • There are many effective methods to use in product development research:Each has its particular advantagesSo it’s important to use the right method in the right situationThe following are several methods we frequently use. Each has specific pros and cons, but all share several important advantages: They Emulate the Real World:In real life, people don’t evaluate the importance of individual features or attributes. They make choices between/among products. The more closely research emulates this process, the more accurate the findings will be. Derived vs. Stated Preference: What people say they prefer, and what they actually choose when given the chance, are often not the same thing. Usefulness of Findings:These methods can be used to inform the widest variety of decisions – from product development to operations to sales, marketing, and advertising.
  • We recently used a combination of social media “listening” with the Crimson Hexagon Tool, Focus groups, and ideation sessions to understand why people had soured on a long-running television series and test ideas for improvement.
  • There are a lot of good tools out there – all of which really require a combination of monitoring and interpretation. We have tested a bunch of tools and prefer Crimson Hexagon because:Unique, proprietary approach to finding “patterns in the dots”Monitors “filter out noise,” selecting relevant sources and ignoring irrelevant crap!User develops categories that matter
  • Anchored MaxDiff is a new approach to Maximum Difference Scaling that enables a true “0” threshold to be computed through the use of dual-response questions. Standard MaxDiff items are purely relative – the zero point is arbitrarily selected by holding out one item during estimation; all other items are estimated relative to that item – so the zero point normally has no interpretive meaning. In Anchored MaxDiff, we not only ask respondents to make best/worst choices, we also ask a follow-up question for each task that is used to set a true 0 threshold level, in this case:All four statements would make you want to increase fittings for the companyNone of the four statements would make you want to increase fittings for the companySome of the four statements would make you want to increase fittings for the company, and some would not
  • Innovations in Product and Service Development Research

    1. 1. Best Practices for Product/Service Development Research<br />Innovative Techniques and Examples<br />
    2. 2. Today’s Webinar <br />Who is Chadwick Martin Bailey?<br />Today’s Speakers<br />Innovations in Product/Service Development research<br />Q & A (please enter questions into the webex Q & A feature and we’ll answer them at the end)<br />2<br />
    3. 3. Chadwick Martin Bailey:Company Facts<br />Founded in 1984<br />60 Employees<br />Headquartered in Boston<br />Global, Full-service Provider<br />Fully Dedicated Retail, Healthcare, eCommerce, Technology, Financial Services, and Travel and Hospitality Practices<br />Sweet Spot: when you want a supplier who will provide original ideas, not just a response to an RFP<br />3<br />
    4. 4. Our Clients: We Partner with Leaders in a Range of Industries<br />4<br />
    5. 5. Chadwick Martin Bailey: Our Specialties<br />5<br />
    6. 6. Today’s Speakers:Rich Schreuer and Amy Modini<br />6<br />
    7. 7. Research Along the Product/Service Development Pipeline<br />
    8. 8. Key Steps in the Product Development Process<br />8<br />5. Business<br />Analysis<br />4. Strategy<br />3. Concept<br />Testing<br />6. Product<br />Configuration<br />2. Concept<br />Development<br />7. Market Testing<br />1. Idea Generation <br />8. Marketing<br />
    9. 9. Research Innovation at Key Steps in the Process<br />Research plays a role throughout the product development process, providing market input that drives innovation<br />9<br />Stage 1:Idea Generation<br />Stage 3:Concept <br />Testing<br />Stage 8:Marketing<br />Stage 6: Product <br />Configuration<br />Innovative Techniques<br /><ul><li>Multi-method, multi-source
    10. 10. Problem Analysis
    11. 11. Prioritization
    12. 12. Social Media Listening
    13. 13. Maximum Difference</li></ul> Scaling<br /><ul><li>Dual-Choice Maximum Difference Scaling
    14. 14. Dual Choice Discrete Choice
    15. 15. Adaptive Choice- Based Conjoint
    16. 16. Interactive Decision Tool
    17. 17. Brand-Based Product Messaging</li></li></ul><li>1. Idea Generation<br />
    18. 18. Traditional Idea Generation Methods Are Lacking<br />Many companies:<br />Focus on incremental improvements, not groundbreaking ideas<br />Rely heavily on engineering for new product/service and product/service refinement ideas<br />Fail to adapt to changing market conditions<br />Focus more on the what than the why<br />Taking a multi-method, multi-source approach helps:<br />Understand the issues people are facing surrounding your offerings, not just the offerings themselves <br />Hear customers and prospects as they talk amongst each other, and directly to you<br />Focus on solving problems and meeting goals<br />11<br />
    19. 19. There is No Shortage of Sources and Methods To Utilize<br />12<br />
    20. 20. In Qualitative Alone, the Past 4 Years has Shown Huge Growth in Tools and Techniques<br />13<br />
    21. 21. Multi-Method, Multi- Source: Combining Methods From Traditional and Non-Traditional Sources Gives You a Clearer Picture<br />14<br />
    22. 22. For Example, Combining “Listening” with Primary Research Helps Gather and Evaluate Ideas<br />15<br />
    23. 23. Social Media “listening” Mines Traditional, Online, and Social Sources to Extract Meaning and Deliver Insights<br />Select the content sources and search terms<br />Train the algorithm with examples for each category<br />1.<br />3.<br />2.<br />Choose the categories the posts represent<br />Monitor summarizes online conversation<br />4.<br />16<br />
    24. 24. Problem Analysis: Focus on Solving Problems<br />Customer-centric: makes the voice of the customer part of the development process <br />Rating Index: focuses developers on consumer needs that are most urgent/common<br />Competitive Differentiation: Identifies opportunities for compelling and distinctive positioning against alternatives<br />One Rock, Many Birds: Can be leveraged into many other areas, such as sales, marketing, communications, and market positioning<br />17<br />
    25. 25. Problem Analysis: Focus on Solving Problems<br />18<br />Hotel Guests Likelihood to Stay Again<br />Frequency (%8-10)<br />Intensity (%8-10)<br />
    26. 26. Prioritize Individual Product Features From a Customer Centric Viewpoint<br />
    27. 27. 2. Concept Testing<br />
    28. 28. Concepts Need to Be Evaluated Based on Customer and Business Goals<br />Customers:<br />What are customers and prospects trying to achieve?<br />Where are there gaps? <br />Where is incremental improvement appropriate vs. wholesale changes?<br />Business:<br />What would make this offering a “success”?<br />What limitations do we have in developing, servicing, and selling?<br />How does this fit with our brand?<br />
    29. 29. Maximum Difference Scaling is a Great Way to Measure Appeal<br />This approach is especially useful because it: <br />Derives the preferences of respondents, rather than asks it<br />Eliminates halo effects<br />Can handle a large number of features<br />22<br />
    30. 30. A New Approach: Anchored (Dual-Choice) MaxDiff<br />In Anchored MaxDiff, we ask respondents to make best/worst choices… <br />We then ask a follow-up question for each task that is used to set a true 0 threshold level through the use of dual-response questions.<br />23<br />
    31. 31. Stated Preference Rarely Discriminates<br />A Discounts on gas<br />B Deposit to a savings or investment account<br />C Money towards utilities bill<br />D Gift cards<br />E Money towards your mortgage<br />F APR discounts<br />G Interest rebates<br />H Discounts at selected retailers<br />I Travel rewards for use with a variety of carriers<br />J Bonus miles/points after spending a certain amount<br />K Travel upgrades or discounts (hotels, rental cars)<br />L Frequent flyer miles for a specific airline<br />M Online mall<br />N Money towards school tuition<br />O Tickets to events and shows<br />P Donation to a charity/school<br />Q Donation to reduce carbon footprint<br />Appeal of Features<br />(%8-10)<br />24<br />
    32. 32. But Employing a Trade-off Technique (Such as Max-Diff) Ensures Differentiation<br />A Discounts on gas<br />B Deposit to a savings or investment account<br />C Money towards utilities bill<br />D Gift cards<br />E Money towards your mortgage<br />F APR discounts<br />G Interest rebates<br />H Discounts at selected retailers<br />I Travel rewards for use with a variety of carriers<br />J Bonus miles/points after spending a certain amount<br />K Travel upgrades or discounts (hotels, rental cars)<br />L Frequent flyer miles for a specific airline<br />M Online mall<br />N Money towards school tuition<br />O Tickets to events and shows<br />P Donation to a charity/school<br />Q Donation to reduce carbon footprint<br />Desired Features<br />IChart displays the mean appeal (importance) score for each item. Maximum Difference utilities are converted into ratio-scaled probabilities that sum to 100 across the items. Thus an item with a score of 8 is twice as important as an item with a score of 4. The dotted line represents the average (5.9). NTERPRET WITH CARE – MEAN VALUES HIDE HETEROGENEITY OF PREFERENCE AND ARE SKEWED BY OUTLIERS. <br />25<br />
    33. 33. With Anchored MaxDiff You Get Mean Utilities<br />26<br /> Concept:<br />
    34. 34. 3. Product Configuration<br />
    35. 35. Traditional Product Configuration Methods Are Lacking<br />Typically, companies follow one of these processes:<br />Use best guess, and go to test market<br />Develop concepts based on an internal model, then go to test market<br />Rely on slight changes to a competitively successful product<br />Conduct focus groups to refine existing concepts<br />Trade-off modeling such as Discrete Choice and Adaptive Choice help:<br />Predict market share under competitive situations<br />Identify dollar value of product features<br />Optimize product configuration for key sub-groups<br />Segment market based on unique configurations<br />Identify price/demand curve<br />28<br />
    36. 36. For Years Discrete Choice Has Been Solving Several Problems<br />29<br />
    37. 37. Adaptive Choice-Based Conjoint is Going Further<br />ACBC is an innovative approach to trade-off modeling because it adapts to respondent choices in order to collect better data<br />Captures more information from the respondent for more stable individual level estimates<br />Allows us to better analyze smaller sample sizes<br />Is more effective in situations where pricing is a critical objective<br />Based on respondent feedback, we find it provides more engaging interviews and respondents like this method better than standard choice models<br />30<br />
    38. 38. Adaptive Choice-Based Conjoint is Going Further<br />ACBC consists of multiple stages:<br />Build-Your-Own (BYO) task<br />“Near Neighbor” concepts<br />Determine “must haves” and “unacceptables”<br />Choice Tournament<br />31<br />
    39. 39. A Market Simulator Can Be a Powerful Predictive Tool<br />For example, Credit card usage was lagging behind the US in Europe, and our client tasked CMB to explore how various credit card offerings would affect market share and usage <br />The following features are included:<br />32<br /><ul><li>Free Trial: Trial period before any other service fee is charged
    40. 40. Security: Card features designed to ensure that no one except the legitimate card holder can use the card to make purchases or cash withdrawals
    41. 41. Protection: Card features designed to limit the financial liability of the card holder
    42. 42. Card Holder Benefits: Extra benefits for using the credit card to make purchases
    43. 43. Annual Fee: Yearly fee charged by the issuer to administrate the card and transactions
    44. 44. Card Scheme: The credit card provider used for the card
    45. 45. Card Issuer: The type of financial institution that issues the credit card and provides support to card holders
    46. 46. Annual Percentage Rate: Interest rate charged on credit card
    47. 47. Account Support:Additional types of customer service available to card holders
    48. 48. Managing Cash Spending:Methods by which card holders can control spending with the card
    49. 49. Managing Repayments:Payment plan options available to card holders </li></li></ul><li>Interactive Decision Tools <br />The Interactive Decision Tool (IDT) allows you/your users to explore trends<br /><ul><li>Quickly and easily optimize your offering based on particular parameters or model various scenarios
    50. 50. Understand the relative importance of features
    51. 51. Model in the tool or simply download charts or underlying data to excel</li></ul>33<br />
    52. 52. 4. Marketing Support<br />
    53. 53. Ensure Product-Specific Messaging Supports the Brand<br />35<br />
    54. 54. HIGH<br />Discloses all info up front<br />Guided throughout process<br />Specialist available 24/7<br />Beats national average on rates<br />AWARENESS<br />Work with same specialist<br />TRUST<br />CUSTOMER SERVICE<br />Close loan at your location<br />Highest security standards on the web<br />Low rate guarantee / cash back<br />LOW COST<br />LOW<br />HIGH<br />LOW<br />IMPORTANCE<br />Prioritize Messaging Based on Brand Support AND the Impact on Loyalty<br />36<br />
    55. 55. In Summary: Best Practices of Product and Service Development Research At Each Stage<br />Idea Generation: Use a multi-method, multi-source approach to listen to the market and gather ideas for concept testing<br />Concept Testing: Test concepts in terms of how they meet both customer and business goals<br />Product Configuration: Use sophisticated trade-off modeling (such as Dual Choice Discrete Choice and Adaptive Choice) to develop the optimal set of features, benefits, and tiers<br />Marketing: Evaluate messaging holistically in terms of relevance, appeal and brand fit<br />37<br />
    56. 56. Questions?<br />See some of these approaches from a respondent perspective by going through the trade-off technique demos at:http://www.cmbinfo.com/why-cmb/analytics/<br />Follow us on twitter @cmbinfo , Read our blog at blog.cmbinfo.com or become a fan on Facebook<br />

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