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PRODUCT (Q1 Is it an attractive concept overall? (Use Chain Ratio Method…
PRODUCT
Q1 Is it an attractive concept overall?
Use Chain Ratio Method
Input 3: availability (distribution, mgmt. judgement)
Input 1: intentions to purchase survey
Input 4: aware, given available
Input 2: discount/correction factor
Use Concept Testing
Compare Purchase Intentions (PI) scores to industry benchmarkts
Discount PI scores
consumers' over optimism
availability
awareness
Q3 How (and when) will it get there?
Estimate trajectory of adoption use
Simulated Test marekting models
Fourt-Woodlock
ASSESOR
BASES
Parfitt-Collins
Roger's 5 Factors
Bass Diffusion Model - how new products get adopted in a population
p - coefficient of innovation
q - coefficient of imitation
m - total market size
N - number of previous buyers
No. of new adopters at time t = mp + (q-p)N - (q/m) N^2
Typical Product Life Cycle
Price
skimming or penetration -> gain market share, deal -> defend market share, profit -> stay profitable
Promotion
inform, educate -> stress competitive difference -> reminder oriented -> minimal promotion
Product
One -> More versions -> full product line -> best sellers
Place (Distribution)
limited -> more outlets -> max outlets -> fewer outlets
Competition
Few -> More -> Many -> Reduced
The adoption process
Early majority
Late majority
Early adopters
laggards
Innovators
Market forecast based on Chain Ratio, Concept testing, and conjoint analysis
Q2 What's the winning configuration?
Use Conjoint Analysis
Sum of the utilities of its constituent attribute levels
Estimate utility of each level of attribute
Conjoint reveals what people really want
Steps
Figure out atributes and attribute levels
Create "product profiles"
Reduce large designs
model ratings to yield "utility" scores
Administer survey