How The DRG Can Improve Your Product Testing Program

We gather information to create and launch market research insights that enable better business decisions

The Dieringer Research Group, Inc. www.thedrg.com ConfidentialConfidential andand ProprietaryProprietary Why Do Product Testing? To identify and solve some of these common problems…

It is estimated that over 45% of product development and refinement resources go to ventures that do not succeed, and 80-90% of new products introduced in the market fail.1 Some of the problems that can be prevented with testing include:

Product Does Not Fit the Market Example: McDonald’s Arch Deluxe In 1996, McDonald’s spent at least $150 million in advertising to promote this burger, targeting ‘sophisticated’ consumers. However, they soon learned that consumers looking for a higher-end burger do no typically go to McDonald’s.

Product Features Do Not Make Sense

Example: Maxwell House Ready-to-Drink Coffee Maxwell House promoted the convenience of this pre-brewed product. But coffee drinkers preferred to freshly brew their coffee, even if it was slightly more work.

Poor Concept

Example: Clairol’s ‘Touch of Yogurt’ and ‘Look of Buttermilk’ Shampoos Many consumers did not like the idea of washing their hair in yogurt. And Clairol’s buttermilk Shampoo left people wondering ‘What exactly is the look of buttermilk and why do I want it?’

1 “Doing it Right, Winning with New Products” by The Product Development Institute, 2006

The Dieringer Research Group, Inc. Page 2

40 Years Strong | our experience…your success Confidential and Proprietary Other Common Problems Include…

Outdated Product(s) Ineffective Packaging Confusing Brand Name • Example: Polaroid Cameras • Example: Kellogg’s • Example: Frito Lay • While at one time very Breakfast Mates Lemonade profitable, Polaroid cameras • Similar to Lunchables, this • Just because a current brand is lost market share due to not product packaged together well-known, does not keeping up-to-date with everything children needed to necessarily mean it can technology prepare their own breakfast: a naturally be extended to other • With the average product small box of cereal, milk and a product categories lifespan shrinking 400% within spoon. A television ad featured • While it is great to leverage the past 50 years, companies parents peacefully sleeping brand awareness, it sometimes cannot rely on existing product while their children made does not make sense. For offerings1 breakfast example, consumers did not • The problem was the associate a refreshing glass of packaging was too difficult for lemonade with the brand of a young child to open! their potato chips

1 “Doing it Right, Winning with New Products” by The Product Development Institute, 2006

The Dieringer Research Group, Inc. Page 3

40 Years Strong | our experience…your success Confidential and Proprietary The Importance of Product Testing

There is no guarantee that a product is always going to succeed

However, well-designed product testing research can aid in identifying these problems early on before products fail in the With the growth of social media, more users are sharing their product marketplace experiences (both positive and negative) with others. With this trend, it is even more important to identify and correct any concerns as early as possible, before the reputation of your product and brand is affected.

The Dieringer Research Group, Inc. Page 4

40 Years Strong | our experience…your success Confidential and Proprietary There is no “one size fits all” product testing research study

100 Days Until Product Launch!

The DRG customizes each study to our client’s business needs, product ADD category and target market, helping YOUR our clients choose the right path! Do you know if your productTEXT will stand out in the marketplace?

The goal is to ensure you get the most value from your research investment and you have the market insights you need to make product decisions with confidence.

The Dieringer Research Group, Inc. Page 5

40 Years Strong | our experience…your success Confidential and Proprietary Product Testing Research Considerations

Some of the questions we ask our clients when designing and implementing product testing research include:

Business Goals • Where are you in the product development process? and Information • What type of information are you looking for? Needs • What are your specific goals and objectives?

What are the characteristics and features of your product? Product Type • • How does the user interact with your product?

• Who is your target market? • What are the lifestyle characteristics of your potential Target Market buyers? • Are there specific segments or groups you would like to compare?

Following is more detail on a few of these considerations. Contact The DRG for additional information! Where are you in the product Business Goals and Information development process? Needs

The DRG works with clients to understand where they are in development and tailors the research design accordingly.

Exploration / Development & Testing Validation Launch Investigation Refinement • Explore initial • Determine ideal • Test one or several • Confirm and validate • Bring product to first impressions, likes and product features and product prototypes the product prior to test market(s). Full- dislikes; Investigate benefits. Also start with potential buyers full-scale launch. scale launch after competitors’ offerings planning name, logo, prior to finalizing the Develop marketing gathering feedback as well as internal packaging, pricing product; product plan and go-to-market from test markets. customer data to and key selling testing can begin as strategy • Research uncover any unmet features soon as a prototype is • Research Techniques: needs • Research developed Techniques: Pre and post-launch • Research Techniques: • Research Surveys often interviews and/or Techniques: Quantitative survey Techniques: conducted to obtain surveys with test and Qualitative focus often with conjoint, CLTs or in-home use feedback of final control groups help groups, in-depth MaxDiff or other tests conducted to product as well as measure effectiveness interviews and/or trade-off technique. evaluate usability and positioning, taglines, of product and secondary research Web surveys are perceptions of target ads or other marketing, and identify ideal for showing market; More testing is communications used any potential issues pictures/video of also now conducted to sell the product early your product via online and mobile techniques (e.g. online journals where pictures/video can be posted of the products being used) Even products already on the market are continuously going through this process, as companies need to constantly be evaluating modifications and improvements to ensure their product’s continued success

The Dieringer Research Group, Inc. Page 7

40 Years Strong | our experience…your success Confidential and Proprietary What type of information are you looking Business Goals and Information for – Qualitative or Quantitative? Needs

Qualitative Quantitative Often conducted when you are Typically used when you already evaluating a few preliminary have products or concepts developed concepts and have done little to test but you want to understand previous research The most market reactions prior to launch comprehensive Example Applications: Example Applications: approach - Brainstorming/refining ideas and combines - Measuring how many potential concepts buyers feel a certain way toward a qualitative and product or concept - Exploring how people feel about a quantitative product or concept - Testing already-known hypotheses or methodologies - A first step to identify initial reactions solutions to a potential issue/ before making the decision to invest concerns further - Comparing attitudes and perceptions of different segments or groups

This can even be done in the same project. For example, you can quantitatively test a food product in CLTs/taste tests but still ask participants a few qualitative questions, incorporating a short open-end discussion about the product to provide more insight and uncover the reasons behind their responses

The Dieringer Research Group, Inc. Page 8

40 Years Strong | our experience…your success Confidential and Proprietary What are your specific goals and Business Goals and Information objectives? Needs

For example…

Are you considering a feature Do you have a few options Are you comparing your change in an existing product? developed and would like to product to competitors’ (Comparing your existing product to a test which is best to launch? product offering? new prototype)

• Use sequential monadic testing, • If you have quite a few options, a • Testing against competitors which involves each participant monadic testing strategy may provides an understanding of your testing more than one product work best, where each participant product’s strengths and • Have participants test both the only tests one product option weaknesses, as well as insight on current product and the new • Make sure you have a large where to focus future product product so they can identify enough sample size for each development preferences product so comparisons are • Competitor comparisons also help possible you decide how to position and • After your final product is promote your product narrowed down to 2-4 options, it • Keeping the brand concealed from may then be beneficial to have participants is important so they participants try multiple products, can make unbiased evaluations so they can make direct comparisons

The Dieringer Research Group, Inc. Page 9

40 Years Strong | our experience…your success Confidential and Proprietary What are the characteristics and Product Type features of your product?

Product Type • Consumer packaged goods are commonly tested through home use tests • Food/beverage products are often evaluated in central location tests / taste tests • Large durable goods are often tested using in-depth interviews, focus groups, central location tests or product clinics (more difficult for testers to take the product home and use) • Services may be tested via mystery shopping or ethnography. Online journals may also be considered, where users can post comments/pictures of their experience Product Complexity Complex products may be best tested using in-person methods: • IDIs, focus groups or CLTs allow you to demonstrate how to use the product • For example, while a car or lawn mower is easy to use, you may want to explain and demonstrate the specific features that make your product unique • You can also then see first-hand where participants are having difficulty • Home Use Tests (HUTs) may still be used to test complex products. But you may want to provide instructions/demonstrations when the product is picked up or delivered Where the Product is Purchased and Used • If evaluating packaging or appeal of your product compared to competitors’, you may want to consider in-store intercepts or ethnographies • Can also simulate a store shelf in a CLT or focus group setting, as well as online in a web survey • When evaluating usability and specific features, it may be ideal for participants to test the product where they typically would use it (home, work, etc)

The Dieringer Research Group, Inc. Page 10

40 Years Strong | our experience…your success Confidential and Proprietary How does the user interact with your Product Type product?

User Interaction • Consumers sometimes need to interact with a product for a period of time before they can develop a complete opinion or preference . For some products, participants should have the opportunity to use the product for at least 1-2 weeks so they are comfortable with all the features (e.g. smart phone) . In this case, a longer-term home-use test or online journal/community may be the best methodology . This works well when you want to test many product attributes or if you want feedback on the overall product experience • However, if the product can be experienced with 1 use (e.g. a food or beverage), testing can likely be done in a day or less (focus groups, CLTs, taste tests) . There are also some products where testing in a one-on-one setting (IDI) may be more appropriate, as you do not want participants’ experiences influenced by others Frequency of Use Daily-Use Product • Participants can test multiple products and make effective comparisons when testing products that are used every day, such as diapers, toothbrushes, shampoo, etc. Occasional-Use Product • Participants may need to be limited to one test product when the product is only used occasionally (e.g. hair dye)

The Dieringer Research Group, Inc. Page 11

40 Years Strong | our experience…your success Confidential and Proprietary Who is your target market? Target Market

Anyone who would potentially purchase and use your product should be considered for testing. But you still may want to consider narrowing your target or oversampling specific segments. • Overall, testing the product among a wide range of participants helps you understand and segment your target market(s) . This is helpful when you are introducing a new product and unsure exactly who your target market is • But exclude those that realistically would never (or rarely) use your product . For example, a food product designed for children’s lunches/snacks should be primarily tested among households with children • If your product/brand is already on the market and you are testing changes, remember to include both current purchasers and non-purchasers! . Assuming you want to increase your market share and attract new buyers, do not limit participants to just existing buyers

The Dieringer Research Group, Inc. Page 12

40 Years Strong | our experience…your success Confidential and Proprietary What are the lifestyle characteristics Target Market of your potential buyers?

Consider the lifestyle characteristics of the type of users you are trying to target for your product when designing your methodology and recruitment plan. For example:

The Dieringer Research Group, Inc. Page 13

40 Years Strong | our experience…your success Confidential and Proprietary Are there specific segments or groups Target Market you would like to compare?

• Levels of experience with the product, including: . Frequent users who may even influence others to purchase . Occasional users . Non-users (but would consider using in the future) • Brand preferences, including: . Loyalists –purchase a specific brand exclusively; may want to recruit a few loyal to your brand and those loyal to your key competitors . Buyers – purchasers of your brand but also occasionally buy other brands as well . Switchers – purchasers who are not brand loyal and typically base their purchase decision on price, what’s on sale, etc • Demographics . You may also want to compare age, gender, ethnicity, geography, income, etc

The Dieringer Research Group, Inc. Page 14

40 Years Strong | our experience…your success Confidential and Proprietary Benefits of Product Testing Customized to Your Business Needs

Increased Profits! • Higher Sales/Revenue Stronger Brand • Maximize Product Equity Development/ Improved • Positive reputation in Refinement Budget (You Competitive the marketplace will know early on which Position ideas are more likely to A Better • Maintain and grow succeed) Defined Value your market share Proposition • Well-defined, unique product Higher Product benefits • Improved Satisfaction marketing/sales and Loyalty strategy • Keep current purchasers • Grow recommendations and referrals The Dieringer Research Group, Inc. Page 15

40 Years Strong | our experience…your success Confidential and Proprietary P.S. Remember to Test Early and Often!

Ongoing testing can save your product development team time and money. You will spot potential problems earlier, and you won’t be spending resources on product “improvements” that your target market isn’t interested in • Many make the mistake of testing once early in development, then making changes and going Tips to Save Time and Money for straight to market Ongoing Testing • Have the same participants evaluate • Others make the mistake of waiting to test until product prototypes right before launch . This saves on recruiting expenses • The DRG recommends testing early and often! and time . Participants will also then be able to tell you whether they consider Ongoing testing should be incorporated into your updates to be an your product development plans and improvement over the previous budgets. For each wave of product version they tested changes, try to conduct at least . You can still add a few new participants later in development a few quick tests with to get a fresh perspective potential users. • Consider web surveys for some of your testing . While HUTs or CLTs may be ideal, a quick web survey showing pictures/video of the product can also provide valuable insights

The Dieringer Research Group, Inc. Page 16

40 Years Strong | our experience…your success Confidential and Proprietary The DRG can be your single point of contact for nationwide product testing efforts

• While based in the Milwaukee area, we coordinate with partners throughout the US to field in-person research in other regions • However, all projects are centrally managed from our headquarters

• When working with partners, our Project The DRG’s Milwaukee location is also Managers will often travel to other US a great place to conduct regions to train interviewers or oversee product testing!

fieldwork in other cities, to ensure Milwaukee’s slogan, “Genuine American,” consistency in data collection reflects the city’s all-American culture. With • All data is centrally processed and reviewed over two million area residents and a wide range of industries, Milwaukee is an ideal at The DRG before sending to our clients, market to conduct research. Focus groups, ensuring the information we provide meets IDIs and CLTs can be held at The DRG Focus our high quality standards Center, designed and built in 2010.

The Dieringer Research Group, Inc. Page 17

40 Years Strong | our experience…your success Confidential and Proprietary For more information, please contact:

The Dieringer Research Group, Inc. E-mail: [email protected] Phone: 888-432-5220 www.thedrg.com

The Dieringer Research Group, Inc. Page 18

40 Years Strong | our experience…your success Confidential and Proprietary