Concept testing and new product development is one of the more common reasons for the commissioning of market research. Whether it is proof of concept or a new product development company looking to confirm demand for a new concept to acquire financing and investments, it's requested a lot. "New" is the great unknown. So many lean on market research to help eliminate risk and provide insight into potential demand.
Although the scope and methodologies may be unique to each type of new product or service, we recommend the following 3 core components to any new product development market research.
Thinking about market research for your new product? Use these 3 components to help guide you.
Component 1: Market Analysis
In this first component, the new product development market research firm you choose will use secondary research to highlight key data and trends in the product or service industry. The market analysis will break down industry charts and graphs found through online and in-house sources with narrative relative to the new product or development launch plans. Many will have access to proprietary in-house systems and syndicated data that is not available for free online. This is secondary market research.
The market analysis will review your vertical using a SWOT analysis to understand strengths, weaknesses, opportunities, and threats for the new product or service. The report findings will provide the client with barriers to entry as well as featuring stories of new market entrants and how the companies successfully launched (if available).
Demographic data of users on a broad scale will also be featured where available. Although sales revenues and profit margins may be difficult to obtain through publicly available sources, best efforts will be made to inventory these statistics as they are found through secondary research. From there, ranges and means of sales revenue and profit margins can be calculated to provide the client with an estimation on what to expect based on industry norms.
Component 2: Competitive Assessment
This component of market research will fully examine and inventory key competitors in the company's industry. This competitive list will be approved before any research will begin. An in-depth competitive profile will be created for each company featuring product offerings, competitive differentiators, marketing messaging, and any financial or growth figures. The report will provide the client with potential market share figures and core competencies in which a new market entrant would need to compete against. Competitors will be selected and agreed upon prior to starting the competitive assessment.
Component 3: Market Survey
This component of market research is highly recommended as part of a new product development market research project. This will be a customized 15 to 20 question survey administered to a random selection of targeted respondents. The goal is complete surveys with a minimum of 200 respondents with a potential of 400, 800, or 1,000 cases. The statistically reliability of your survey increases with the number of completed surveys.
Online surveys are cost-effective, offer a quick turn-around, are measurable, and gather quality data. The combination of these 4 benefits creates a strong ROI and provides investors with unique and custom data which points to the potential success for the client.
The survey will be administered through an online sample pool to ensure results are representative of the demographic make-up of the country, or market area you choose to focus on. The survey could cover a number of topic areas: usage of similar products, factors which influence choice, awareness and usage of competitors (share), areas of improvement for new products, appeal of marketing messaging, and appeal of the new product development concept. Other topics will also be explored.
No other market research component in the feasibility study will offer the client more depth and applicable data than the custom online survey.
Final Report
The market survey report will include an executive summary of themes with, an infographic, a customer persona, and a question-by-question breakdown of all survey results. The report also includes insights and recommendation to guide next steps of new product development. This type of unique data that specifically addresses the business and potential of the new product and will prove extremely valuable to investors for the client.
Contact our New Product Development Market Research Firm
Drive Research is a new product development market research firm located in Syracuse, NY. We conduct feasibility studies and new product development research for all types of products and services across the country.
Contact us at 315-303-2040 or email us at [email protected].