When you own your own small business and want to launch a brand new product then a little concept testing is in order. Rarely is it a good idea to just send an untested product to the manufacturer and put it on the market. You need to invest as little as possible in the product and put it in the hands of a few consumers to see if the product is viable in the marketplace. There are several ways you can test a product to see if you have a hit or a flop on your hands.
Testing Only the Idea of the Product with Consumers
You can survey your customers to find out if the new product you would like to launch would interest them. The problem with doing this is that you are asking average people if they think they would like this product. Usually, the customer is the last person who can accurately judge whether or not they’ll purchase the product. So, the results you receive from the survey won’t accurately reflect how well it will sell in the marketplace.
Consumer surveys are very problematic. Many consumers will say they would be interested in buying the product for a variety of reasons. People have a natural tendency to want to please a stranger and be polite, so they will say that they will buy it. Others will find the colors used attractive and say they’ll buy it. Some will say they won’t buy the product because it is being presented in a way on paper that the consumer feels is very unattractive or doesn’t adequately address their need for that product. It is nearly impossible to approach the consumer in a way to get a response that will judge a product’s success. Usually, surveys are done over and over and change as the consumer steers the survey in a certain direction and your potential product’s development will change as a result.
When a product is released, it is almost always released in a way that was not described in the survey. Now that it is on the market it has a different color, a different price, a completely different product description is on the label and the nutritional information is now included on the product. Likely all of this information was different at the time of the survey. So, as you can see, it is difficult to accurately survey the target consumer.
There are so many variables with surveying consumers that it is nearly impossible to get an accurate answer to your question of whether or not you should release this new product. The only sure way to know is to manufacture the product and put it before your customers to see if they will purchase it.
Product Test Release
When your small business would like to develop a new product, it is best to manufacture enough for small tests with your own customers. Just because you think it is brilliant and addresses a need your customers have, doesn’t mean you are right. It is possible that you are overlooking a major flaw and your customers actually do not want it. So, what you do is release it in a small test market to see if this product idea is going to fly.
If your product sells as well as hoped, then you can release it to a larger market and see how it does there. If it is popular with your customers then release it outside of your customer base and see how it sells.
Once you feel confident that your product will sell, you need to fine tune it. You need to test various prices for the product. If you absolutely have to recover $3 per sale in order to break even, give $19.95 a try as a price to see if it sells well. If not, then try to put a different combination of colors on the label, change the name of the product, reword the packaging and try out various minor changes to see how it affects the sales of the product.
Price is an Odd Thing
Price is really an odd thing because people will buy or pass on price alone. If your product is priced at 7.52, people might not buy it at all. If you change the price to $9.95, then they will buy it all day long. Consumers have been trained to like certain numbers in the past many decades. It is absurd to think that the difference between $9.99 and $10 would mean anything at all. It is only one cent different! Oh, but it means everything. People have an instant gut feeling that $9.99 is so much less expensive than $10. Ten dollars sounds like quite the gouge in the wallet, but $9.99 sounds like it is being offered on sale and a great deal.
When you are putting a price on your products, you need to keep the look and feel of the numbers in mind. Shoppers are automatically attracted to $9.95 and $19.95 prices, so the small business should shoot for those numbers whenever possible. If you are pricing yourself out of the market with $19.95 then bundle several of your products together and price it at $19.95. You will sell far more products because they have to buy more of your product instead of the option to buy just one and they will be attracted to the $19.95 number itself. If $19.95 means too many of your products to buy at one time then make it two at $9.95 and you’re only doubling your sales.
When $9.95 or $19.95 doesn’t quite work out for your product then keep the ending of the price in mind. Always have a retail price that ends in .95, .98 or .99. People see these numbers as a bargain. If you need to price your products at $4.00 then make it $3.99. You will sell far more at the $3.99 price than you will at the $4.00 price.
Test Different Consumer Markets
If you truly feel your product is viable but your test marketing did not do well with the original target consumer, then consider changing your target market. If your initial test was targeting teenagers then try a test with senior citizens. If your initial test was with Caucasians then make your next test target Latinos. It is also quite possible that a product that does not address the needs of the average retail consumer might be a goldmine when marketed business to business. A lot of product development relies heavily on the experienced business person’s gut feeling. So, if you feel you have a winner then approach the target market from a completely different direction in order to find the profitable market.
Test a Different Marketing Method
If you are receiving positive feedback from consumers but they just won’t buy it then change your approach. Possibly the consumer will rush to buy the product when it is offered in bulk or as a wholesale to consumer product. If they think they are not allowed to buy it because they are not a licensed business but you let them know you will sell it to them in bulk anyway, it might create the urgency needed to get them to buy.
You can try many different ways to approach the consumer to improve the sales. Sometimes it is the manner in which it is sold and not the price or the product itself that sells it.
Check Your Label for Consumer Benefits
It is important to make sure your label contains the benefits the consumer derives from the product. If you have listed numerous features on the label, but never pointed out in plain writing what benefit the customer derives from the product then they aren’t likely to buy it. When it comes to customers, they are very self-involved. They want to buy things that are going to do something for them that they want. If you are selling makeup then let them know your eye shadow will make them beautiful, that your lipstick will make their lips kissable. They don’t care about the color red; they care about kissable and beautiful. If you are selling a book, let them know it will make them rich and don’t bother mentioning it is 395 pages long.
Concept Testing Probably Will Not Work
Why people will purchase a product from the shelf and not another one that is just like it is a very complex issue. There are so many variables for product sales that it is usually a waste of money to do concept testing alone and not test the actual physical product. To make sure your business succeeds with your new product launch, it will likely take numerous tests with a prototype of your product and lots of tests with various markets and forms of the product.