Let us illustrate concept development with the following situation: a large food processing company gets the idea of producing a powder to add to milk to increases its nutritional value and taste. This is a product idea, but consumers do not buy product idea, they buy product concepts.
A product idea can be turned into several concepts. The first question is: who will use this product? The powder can be aimed at infants, children, teenagers, young or middle aged adults, or older adults. Second, primary benefits this product is expected to provide say Taste, nutrition, refreshment, or energy. Third, timing people consume this drink say Breakfast, midmorning, lunch, mid afternoon, dinner, late evening etc., By answering these, a company can form several concepts.
Concept 1: An instant breakfast drink for adults who want a quick nutritious breakfast without preparation.
Concept 2: A tasty snack drinks for children to drink as a mid day refreshment.
Concept 3: A health supplement for older adults to drink in the late evening before they go to bed.
Each concept represents a category concept that defines the productâ€™s competition. An instant breakfast drink would compete against bacon and eggs, breakfast cereals, coffee and pastry, and other breakfast alternatives. A tasty snack drink would compete against soft drinks, fruit juices, and other thirst quenchers.
Suppose the instant breakfast-drink concept looks best. The next task is to show where this powdered product would stand in relation to other breakfast products. An instant breakfast drink offers low cost and quick preparation. Its nearest competitor is cold cereal or breakfast bars; its most distant competitor is bacon and eggs. These contracts can be utilized in communicating and promoting the concept to the market.
Next, the product concept has to be turned into a brand concept. The company needs to decide how much to charge and how calorific to make its drink. The new brand would be distinctive in the medium price, medium-price, and medium-calorie market or in the high price, high-calorie market. The company would not want to position it next to an existing brand, unless that brand is weak or inferior.
Concept testing involves presenting the product concept to target consumers and getting their reactions. The concepts can be presented symbolically or physically. The more the tested concepts resemble the final product or experience, the more dependable concept testing is. In the past creating physical prototypes was costly and time consuming, but computer aided design and manufacturing programs have changed that. Today firms can use rapid prototyping to design products on a computer, and then produce plastic models of each. Potential consumers can view the plastic models and give their reactions. Companies are also using virtual reality to test product concepts. Virtual reality programs use computers and sensory devices to simulate reality.
Concept testing entails presenting consumers with an elaborated version of the concept. Here is the elaboration of concept 1 in milk example:
The product is a powdered mixture that is added to milk to make an instant breakfast that gives the person all the needed nutrition along with good taste and high convenience. The product would be offered in three flavors and would come in individual packets, six to a box, at $2.49 a box.
After receiving this information researchers measure product dimensions by having consumers respond to the following:
Communicability and believability â€“ Are the benefits clear to you and believable? If the scores are low, the concept must be refined or revised.
Need level- Do you see this product solving a problem or filling a need for you? The stronger is the need, the higher the expected consumer interest.
Gap level- Do other products currently meet this need and satisfy you? The greater is the gap, the higher the expected consumer interest. The need level can be multiplied by the gap level to produce as filling a strong need that is not satisfied by available alternatives.
Respondent answers indicate whether the concept has a broad and strong consumer appeal.