6 Crucial Steps Of NPD Research
Updated: Dec 12, 2022
NPD research, also known as New Product Development research has 6 vital steps to follow where market research plays a vital role in increasing the likelihood of success. This could be for brand new products, line extensions or refreshing existing products.
Step 1: Screen for ideas
Right at the beginning before the next 5 steps, ideas are formed. Innovative ideas for potential new products can come from anywhere not just internally or from customer feedback but also external partners, competitors, heavy users, supply chain, crowdsourcing and from foreign markets.
Step 2: Concept creation
At this stage following the previous brain storming execution of ideas and selecting one or more ideas to go forward within concept form is where concept testing comes in. Concept testing will be used to ascertain the following items from the target audience about the new idea:
Like and dislikes
Step 3: Business case
The next stage will be getting the financial backing to make this into an actual business case with 3 main elements – product description, nature and size of the opportunity and the project plan.
Market research is used at this point to calculate the market size and potential of the new product either via a macro view of the market, assessing the demand side or measuring all the suppliers in the market as one.
Results from the concept testing phase can be used to evaluate the potential revenue if you have potential pricing strategy in mind and estimated marketing spend to go with the number of respondents who expressed an intent to purchase the product.
Step 4: Product Development
Prototypes are being produced at this point, so it is less likely to have market research unless quick customer feedback of these prototypes are needed just to highlight and resolve any problems with the product before going into full scale production.
Step 5: Test and validation
Normally at this stage once the prototype has passed the quality standards is when product trials are carried out amongst the target audience. These product trials allow for valuable customer feedback on the design of the product along with input into the pricing and market strategies.
Like concept testing, comparisons with existing products can be made to see how the new offering stands out and not just amongst your customer base but also other people who may fall within your target audience. The feedback from participants will have immense influence on decision makers.
Step 6: Launch and monitor
Finally, the product will go into full scale production and launch into the market. Research can be carried out to track and monitor the product’s performance over a number of key measures. This tracking research will be used to do the following:
To recognise what attracted customers to the new product.
Uncover what persuaded people to switch.
Evaluating the overall satisfaction of the product along with a number of performance attributes.
Assessing how likely your target audience are to recommend the product to others.
As both qualitative and quantitative research are used in exploring new product ideas and testing concepts, a success criterion needs to be established in which benchmarks for that market can be measured against for the performance of new concepts and prototypes. For example, success criteria are normally based around purchase intent, which is often a 5-point scale question where the top box or top 2 box scores are used to help judge the success rate of the new prototype.
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