Page 167 - DMGT408DMGT203_Marketing Management

Marketing Management/Essentials of Marketing

Notes The more clearly, the concept is presented and resembles the final product, or helps consumers
visualise the experience with it, the more reliable its testing. Some firms use rapid prototyping
(a computer-aided design programme) to design small appliances and produce plastic models.
This helps potential customers seeing the model and comprehending the concept easily. Some
companies use virtual reality to test new product concepts. The questions those respondents
answer after the new product concept is presented to them, focus on a product’s ability and
degree of meeting a consumer need, clarity of benefits and their extent of believability, as to
whether the product sounds superior to existing solutions, its perceived value relative to proposed
price, and the respondent’s purchase intention. The questions asked vary considerably, depending
on the type of product concept being tested.
Customer preferences for alternative concepts can be measured through conjoint analysis wherein
respondents are asked to rank varying levels of product’s attributes to determine the most
attractive product offer.

Note Concept Testing of a New Mosquito Repellent

Product Description
A consumer product company is considering the development and launch of a new mosquito
repellent. This product would consist of a liquid dispenser, much like deodorant containers,
you are familiar with. The mosquito repellent easily comes out from the nozzle and
rapidly spreads in vapour when its push-button release is pressed lightly. Only a small
amount of repellent is dispensed with each press and is mildly perfumed. The chemical
used is completely non-toxic for humans and pets. Only 5 ml. of repellent is enough for a
room measuring 14 × 12 sq. feet and its effect persists for two days after the room is
sprayed just once.
Please answer the following questions:
1. How do you feel about using this type of product in your home?
2. What major advantages do you see over existing products that you currently use to
get rid of mosquitoes?
3. What attributes of this product do you particularly like?
4. What suggestions do you have for improving this product?
5. If it is available in pressurised 300 ml. containers at an appropriate price, how likely
are you to buy his product?
Very likely Moderately likely Unlikely
6. Assuming that a container will last for 15 days in a 3-bedroom house, approximately
how much would you pay for this product?

7.2.4 Business Analysis

It is an assessment to determine the new product’s potential contribution to the company’s sales,
costs, and profits and for this reason a financial analysis is necessary. An income and expenditure
statement needs to be prepared and requires secondary and primary data from the market
concerning consumer surveys. The aim of this financial analysis is that the new product should
at least break even over a period of time. Obviously, at this stage any forecasts can be based on

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