Five Approaches for Effective Product Optimization

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1 Research Brief 103 Five Approaches for Effective Product Optimization What does it mean to have an optimal product? Is it the product that achieves the highest liking score? The product that provides the greatest margin? Or is it the product that has the best quality? Certainly these are all elements of what defines an optimal product, but they alone do not guarantee success. A product that has been optimized is a product that has charisma and fulfills the needs and desires of a large group of consumers. It connects with them emotionally and becomes deeply rooted to their lifestyle, values, and identity. Consumers don t speak in terms of optimized products. The idea that a product has been optimized isn t foreign to them; it s just not relevant. They do say that a product didn t meet their expectations or that it wasn t clearly different from what they were already buying. If we want to fulfill their expectations with a differentiated product, we need to deliver a product that fulfills the desires of target consumer. This brief will discuss the how to: Define what jobs the product will fulfill. Describe how it will be different in utility, sensory, social, and emotional jobs. Identify the contexts the product needs to be optimized for and the target consumers based on their Target research recruiting based on preferences, and assume that preferences can and will change over time. Determine a strategy that focuses on rational or intuitive choice, if rational focus on optimizing for utility - if intuitive focus on optimizing the priming effect. Once the researcher understands who the target consumer is, the purpose of the product, the jobs that need to be done and in what context, it is easier to optimize the product design, and identify preferences and actions that consumers will take. What is a product? A product is the tangible delivery of a brand promise. The job the product fulfills, how it is positioned, and its conceptual nature all provide meaning. Surrounding those elements are all the physical things a researcher can control, such as the functionality, features and sensory qualities of the product. Many of the most painful product failures in the CPG industry occur when companies don t balance science and marketing with the brand. When R&D and Marketing efforts aren t properly integrated to deliver products in a holistic manner, products generally fail to meet the expectations of the consumer. Most companies will tell you that their R&D and Marketing teams work together pretty well. But it isn t just about working together. What often happens is marketing is focused on the consumer experience, but R&D is focused on, 2009,. All Rights Reserved. January 2010

2 developing a recipe or uniquely functioning product. Recipe optimization is focused on taste or liking without the benefit of brand identity or product concept. The problem is that liking alone cannot predict behavior. Marketing and science must be brought into balance to match product attributes to the desired experience for that product. Kellogg s new Cinnabon Breakfast Bars illustrate the importance of balancing the marketing messaging or brand expectations with the sensory aspects of a product. Since this is a co-branded product, both the Kellogg s and Cinnabon brands function together in shaping product expectations. Like many companies, Kellogg s used co-branding to maximize initial product acceptance by leveraging the appeal of other companies brands, but failed to adjust the product appropriately. When consumers see the Cinnabon name they are reminded of the amazing sensory Zen achieved by the flavor combination of world famous Makara cinnamon, sweet sugary frosting, and the warm gooey experience of the ultimate cinnamon roll. So when Kellogg s put the Cinnabon brand on a package of snack bars, consumer expectations of how the product should taste, smell, look and feel were already defined. Without the expectations set by the Cinnabon brand, the breakfast bars probably would have been a great new product. Kellogg s delivered a greattasting bar, but its well-rounded cinnamon flavor and hard frosting conflicted with consumer expectations of the Cinnabon brand. In looking at this example, we can guess that the R&D team was probably optimizing the product by testing unbranded samples and focusing on creating the best liked product, while Marketing was looking for a line extension that capitalized on Cinnabon s brand attributes. A great idea and a great taste that are out of alignment with consumer expectations will get initial trial, but repeat purchase is doubtful. How can researchers ensure balance between marketing and science? The first step is to understand the final goals of the product. Focus on the brand attributes the product needs to deliver against. Understand the value and purpose of the whole product (including brand) and ensure that the product you develop delivers on those values. This is a critical first step in being able to balance science and marketing trade-offs effectively. Protocept methods like Free-Association help translate consumer experience into what R&D has developed. Use qualitative techniques, especially one-on-one interviews with consumers, to get a deeper understanding of where the prototypes are falling short of their expectations. Understanding Product Differentiation In order to truly optimize a product, it is also important to understand how the product is differentiated from the competition. What does it mean to be differentiated? Most developers think about differentiation from a very technical standpoint, focusing on features and functionality. But it is how the consumer distinguishes one product from its competition that matters. Consumers tend to have broader and subtler considerations than just the technical differences between items; they think in terms of what products do for them as a whole. A key to understanding product differentiation is to ask what job does the target audience need this product do? There are four aspects of a product to keep in mind: 1. Product utility. Utility is about the product s performance. It is the function that a product performs or the outcome of use. (Examples: products that provide increased nutrition or are more convenient. 2. Sensory attributes. Sight, touch, sound, taste, and smell. These are the aspects of the product that we physically perceive and that provide physical pleasure. (Examples: products that differentiate on a unique design experience, like, or a sensation, like Pop Rocks.) 3. Social aspects. These are the attributes of the product that speak to 4. individuals sense of self and how they interact with others their self-social identity. How a product aligns with an affinity group or status that the consumer identifies with or how they share a product are part of the social jobs that a product performs. Emotional aspects. How the product stimulates or connects with the consumer by providing experiences like comfort, delight or surprise. Successful brands like Oreo rely not necessarily on a taste advantage over the competition, but the strong emotional connections they make with consumers due to brand associations and history. These four ways to differentiate are based on how the product is experienced by the consumer. They define the expectations of the brand, the purpose of the product and the product s job. By finding ways to differentiate in all of these areas you not only increase the degree of separation between the product and others, but also connect with consumers more completely. In order to truly understand what jobs the product will do for consumers, keep in mind in what context they use the product and who are they are. Context is not only the place and time, but the consumer s physical state and state of mind. Brainstorm all the different contexts in which consumers might purchase or consume the product, and connect those to what jobs the product will perform. This will continue to provide focus and help streamline the optimization process. Using research to understand jobs to be done Targeting consumers is more than just identifying demographic groups, but also psychographic groups based on behavior, values, and lifestyles, and how they use the product. A simple way to understand consumer behavior, contexts and jobs is to design a questionnaire with questions that are as conversational as possible and walk

3 through the process from start to finish using a combination of CATA questions and open ends. Always start by setting the stage. Make sure questions sound like a one-on-one conversation. For instance: Imagine you are in your kitchen making your favorite pasta and sauce meal for dinner. Could you help me understand your process for making, serving and eating your meal? Ask what they are making. Ask specifically about the context of the meal. Put answer lists into a form similar to how they might respond to you in a conversation. By walking through the whole process in this manner it is very easy for consumers to describe their actions. This is a great way to understand the scope of the most common behavior patterns for a specific situation. It provides a good understanding of the brand or product connections and how to differentiate and connect with real To dig deeper into the jobs that people want their products to accomplish, researchers need to leverage conversation and storytelling techniques. The deepest information comes from using a combination of observation, storytelling, and quantitative methods. One simple way is to have respondents complete journals or diaries in which each entry is a story. For example, consumers describe in their own words what they hoped would happen during a pasta meal at home this gets to their expectations of the situation and the role that the pasta played in accomplishing those expectations. Researchers can then build lists of the most common jobs and develop a list that encompasses all the jobs to be done. Understanding the jobs that need to be done helps to create products that differentiated. Reviewing the stories and information provided by personal interviews allows researchers to gain a clear understanding of the needs and desires and identify jobs that consumers may not be able to articulate. A technique that can be helpful in optimizing your product for a wide range desires is to list out what jobs your product will do for people who have specific behaviors within a specific context. This technique provides an understanding of the needs through observation, conversations and creative thinking. Ethnographic research is especially useful. Going on location to see people behaving in context makes it easier to see what jobs they are trying to accomplish what is working for them and what isn t. Researchers can also learn by observing behaviors in research environments. In one instance, consumers were complaining about a microwave product. By having a group come into a facility with a nice kitchen and watching as they prepared the product in question, researchers were able to quickly identify a more intuitive design that would allow a more optimal experience. Video cameras and diaries can also be used to provide unique insights into peoples needs. Conversations with the consumer may seem like they only identify needs that can be articulated. At InsightsNow, we ve found that an engaged consumer can often describe needs without realizing they have done so. By using hybrid research methods, researchers can get answers to questions about products in real-time that enable profiling for more in-depth information. Storytelling is also a powerful way to identify consumer wishes or desires. Stories are natural way to articulate and identify emotions, allowing the researcher to identify opportunities to align the product with the consumer s expectations. Creative thinking techniques bring together very creative individuals for ideation and brainstorming sessions. As part of consumer panels or expert panels from outside your field, creative individuals are often able to identify needs that other people are not able to articulate. For instance, a mobile home company brought in someone from the airline industry. Since airlines also work with small spaces, the expert understood how lighting could be used to create a more relaxed and comfortable feeling. Understanding preference Preferences are highly dependent on context. Remember that consumer preferences can be influenced by awareness or non-awareness of the brand. Letting consumers know the brand or other information related to the product generates a more holistic understanding and allows the consumer identify other jobs that the product might do. Blind preference testing should be used to understand needs the product or a product in this category will have to fulfill. It is also can be effective when working on quality control issues or claims substantiation research. To effectively optimize a product the researcher should understand and be able to articulate the whys behind preferences. Multivariate techniques such as preference mapping are great for handling large and disparate data sets. When asking a consumer about preference between two (or more) items, one solution is to focus on an occasion, a friend and the product separately. For the occasion, ask respondents about a time when they would enjoy the product, or if they have a lot of experience with the product, ask about past experiences, both good and bad. Ask them to pick one of these products that you think your friend would prefer and why. When focusing on the product, get very specific, make sure the answers are complete sentences and focus on a specific sensation or feature of the product. Using a hybrid method in which you have a conversation about their preferences rather than just listing an open end in a questionnaire is the most powerful way to get at the whys behind preference. In addition, it is important to understand that preferences change over time as the product is experienced. This means that making decisions based on the preferences collected in a central location taste test may change with use

4 70% 60% 50% 40% 30% of the product. Researchers need to consider if they want to rely on singlepoint-in-time-data or if longitudinal research with longer studies will help us better understand how to optimize the product. Real-world Choices No matter how much consumers like a product, it can t be considered truly successful if they aren t selecting, purchasing and using it on a repeated basis. For this reason, product developers and marketers need to understand as much as possible about how consumers make choices. There are two major types of consumer choices: rational and intuitive. Rational choices are the result of conscious deliberation, like choosing a wall hook because it is strong enough to hold a heavy coat. Intuitive choices are more immediate, and may not make rational sense upon consideration like a shopper who sees a dress she must have and buys it even though she can t think of a time when she could actually wear it. Preference During Use Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 One practical item is the decision whether or not to include a no preference option as one of the possible ways to answer a preference question. Including no-preference is a great option when the researcher to dig deeper. We have found that consumer s lack of preference can provide beneficial insights also. If are screening for target consumers or working with a product to see the effects of extended use, forcing the respondent to select which one they prefer, can uncover unconscious preferences and allow patterns to develop that often are visible with the no preference option. Prefer A Prefer B Features, functionality, and objective value play a large role in rational decision-making. A consumer who knows she will use a lot of nails, and sees that a larger pack of nails costs less per nail, is making a rational choice. Products that carry guarantees or performance claims often rely on rational decision-making for their competitive advantage. Store brands continue to grow their share of the market through a focus on value for the money. Forcing consumers to consider their choices rationally breaks the normal buying habits and creates the opportunity for changed behavior. For store brands needing to take share from the category leader, optimizing towards rational aspects of the product will need to be a critical element of the strategy. Intuitive consumer choices take many forms, but the most relevant to research are emotional and habitual choices. Emotions invariably affect the way people act and consider things. The consumer may or may not always be aware of these effects, but many times emotions are more responsible for purchase decisions than rational thought. Behavioral psychologists have found that people value the same items (in this case a value pack of CDs) in very different ways if they are thinking about the emotional value of the product, compared to thinking about the price per CD. This is a good example of a priming effect, in which people are predisposed to think about something in a particular way because of prior stimulus. In controlled experiments, priming effects are easier to pinpoint, but branding and product messaging are generally trying to do exactly that: to create associations for consumers that influence their thinking the next time they encounter the product. Do you want your consumers to be thinking about how the laundry detergent works, or the comfort of a trusted brand and a familiar smell? Are there different groups of consumers who react better to one or the other? These are important considerations to take into account when you re designing your research. It is important to understand the desired associations when optimizing a product. Habits also play heavily into consumer behavior. Not many people have the time or energy to think critically about every single purchase decision every time they are in the grocery store. More likely, they are hurried, preoccupied, or simply don t give it a second thought. When bringing new products to market, it s crucial to understand how they fit into these habits. Is your existing product one that consumers automatically purchase without even thinking of it, or is it being overlooked? Is a new product something that fits into consumers existing purchase habits, or will it require a shift in those habits? Knowing the answer will help you create a product that has the highest chances of being chosen. When it comes to research methods with rational choice, a lot of survey-based techniques can be used. Certainly most are familiar with conjoint methods. But Tournament and Max Diff techniques are also quite useful for helping understand which elements of a product will generate the

5 greatest possibility of in-market choice. With intuitive choices, putting products in consumers homes in extended use situations is an excellent method. This allows the researcher to compare multiple priming methods and multiple products to optimize to the combination that creates the greatest amount of in-home use. Summary An optimized product has charisma and fulfills the desires of a group of people. It s one that connects with consumers emotionally. It becomes deeply rooted to their lifestyle, values, and identity. A successfully optimized product focuses first on brand values and brand purpose. It balances the marketing messaging and the science to set the correct expectations and delivers against them. Using choice based designs and conducting longitudinal studies to study the effect of different types of priming will help you select the most optimal positioning for the product. So for the next optimization project, remember to: List what jobs the product will fulfill. About InsightsNow InsightsNow is the leading product design and development research company whose unique consumer behavior frameworks, powerful technology platform, and rapid delivery of relevant insights provide a rich, integrated, and scalable research environment that accelerates the development of products for major consumer packaged goods manufacturers. Through the company s advanced real time research and analytic solutions, such as profilesnow and reportsnow, InsightsNow provides faster, deeper, and more insightful results. InsightsNow s headquarters are in Corvallis, Oregon with offices throughout the United States. For more information, visit or call Describe how it will be different in utility, sensory, social, and emotional jobs. Identify the contexts the product needs to be optimized for and the target consumers based on their Target your research recruiting based on preferences, and assume that preferences can and will change over time. Determine if you need a strategy that focuses on rational or intuitive choice, if rational focus on optimizing for utility - if intuitive focus on optimizing the priming effect.

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