Releasing new products is risky business. Eighty-three percent of new consumer packaged goods flop. Relying on gut instinct is no longer an option—especially when the average marketing cost to launch a new product is $15 million.
At this year’s Customer Intelligence Summit in Chicago, we learned from product innovation leaders DEWALT and Wolverine Worldwide that the secret to successful product testing is customer intelligence.
In this blog post, we’ll discuss what product testing is, why it’s so essential and the latest and greatest best practices—according to Kate Pinkham, the VP of consumer insights and market intelligence at Wolverine Worldwide, and Shannon Chenoweth, the market research manager at DEWALT.
What is product testing?
While concept testing looks at new concepts before the product is actually made, product testing evaluates the performance and makeup of new products and prototypes before they go to market. This considers how the product is produced and whether it actually does what it’s supposed to do—and is marketed to do. In-market testing, on the other hand, examines which available products and services offer the most value for consumers, making sure that consumers know what they’re buying and why.
Why should we test products?
Product testing protects the consumer and holds companies and manufacturers accountable for maintaining established performance, safety, compliance and quality standards. It also helps align product teams with marketing and sales, making sure everyone’s on the same page. During the product development cycle, testing products is useful to ensure that the original concept hasn’t been lost, to solve any issues early on and ensure the product is a success.
What are product testing best practices?
Bake consumer feedback into the product innovation process
According to Pinkham, customer feedback should be used throughout the entire product innovation process. Get teams involved early-on and often in bringing customers into business decisions. “Consumer feedback is now baked into the innovation cycle across Wolverine Worldwide’s priority brands,” Pinkham shared at her Summit breakout session.
Since 2015, Wolverine Worldwide expanded its customer intelligence efforts by going from one to five insight communities for its brands Sperry, Wolverine, Saucony, Merrell and Stride Rite. Pinkham uses her insight communities of loyal customers to product test everything from concepts and style optimization to needs assessments, final style and color evaluation and brand and marketing communications.
Get to know your product testers
Chenoweth stressed the importance of knowing the demographics of your insight community or product testers. With approximately 12,000 members in the DEWALT Insights Panel insight community, Chenoweth knows that 8,000 of them are professional tradespeople and 4,000 are DIY product users. With this knowledge, she can target the general contractor or the Millennial, for instance, who works in commercial construction in a particular region and owns a hammer drill.
Knowing your community composition is essential for understanding who to target when concept or product testing. “We can reach out to targeted consumers and say, ‘we want to talk to you because you use our batteries and we know you work in a very cold part of the country,’” she explained during her Summit session.
Create an environment that supports rapid decision-making
Chenoweth shared how, because she’s developed a relationship with DEWALT’s end users, her community members feel heard and are comfortable playing an active role in the design and product development process. “We know how many of our insight community members are frustrated with a feature on a product—where dust collects on a grinder, for example,” she said. “When we have new prototypes or ideas, we can reach out directly to members with the specific issue and see if we’ve solved it.”
Having rapid response rates from product testers allows research to play an integral role in the decision-making process throughout the product lifecycle and post-launch. Chenoweth explained how there’s also less risk associated with project decisions now that she’s established trust.
Show the value of consumer feedback
Both Chenoweth and Pinkham emphasized the value of showing the rest of the organization what they do with customer intelligence and product testing. Wolverine Worldwide, for example, now has an ongoing dialogue with customers of products across the entire brand portfolio. That allows Pinkham to be more time- and cost-efficient with research, especially when information is shared across multiple brands. She’s had so much success, in fact, that her team was awarded the 2015 Management Award for Innovation and received double the investment in her research program in 2016.
DEWALT, on the other hand, saved over $1 million in study costs in 2016 and close to $6 million since establishing the DEWALT Insights Panel. The time and resource savings allows DEWALT product teams to add multiple iterations for prototypes and tests. “We can use one resource for the entire lifespan of a project,” said Chenoweth. “Once products have launched, we can follow up easily with satisfaction and quality surveys.”
According to Chenoweth, Frank Mannarino, the president of DEWALT, credits the insight community with helping the product teams gain valuable insight from end users to make better decisions that have a positive impact on the company’s products and the business. Product testing—and customer intelligence—has become a critical part of DEWALT’s business strategy.
Learn more about how you can use customer intelligence to become an agile innovator. Download the ‘Enterprise Guide to Innovation’.