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Concept testing and test marketing are two very important concepts when it comes to developing new products for the market.

It’s common to confuse the two ideas – indeed there are indeed several significant similarities between the two. Both concept testing and test marketing play a similar role: ostensibly, to make sure a product is ready to launch and to iron out any issues that might have gone undetected during the design and planning phase.

However, concept testing and test marketing are different processes and are used for different reasons. In this article, we’ll take a look at each, exploring both their similarities and their differences. Let’s start with concept testing.

Concept testing

Concept testing is how we test a product idea before it enters the market. As the name suggests, it involves putting the concept in front of real customers and asking them to evaluate it in multiple areas. This helps us find out how real-life customers will react to the product.

Concept testing has a series of powerful benefits for marketers. It allows you to quickly notice and fix potential errors before the product launches for real, brings fresh insights to your project, and gives you data-driven feedback that you can use to get buy-in from other members of your organization.

There are a number of methods for doing concept testing, spanning quantitative and qualitative methodologies. Each has its own pros and cons and they have different applications.

(More information can be found in our comprehensive guide to concept testing).

Now we know the basics of concept testing, let’s take a look at test marketing and how it’s different.

Test Marketing

What is test marketing?

Test marketing plays a similar role to concept testing. Its goal, like concept testing, is to assess how well a product will perform in its market.

However, test marketing has a broader scope. Instead of focusing solely on the concept or product, test marketing aims to evaluate your entire marketing plan. It takes into account advertising, distribution, sales, and many other components of your overall strategy, but it does this without actually fully launching the product and taking on all the associated risks.

In product test marketing, you basically run a mini launch for your product in a selected market and see how it performs. It’s like a crash run of a product launch.

Neither the launch nor the test market is big enough that you would suffer greatly if the product were to fail. The goal is to trial run your entire strategy to get an idea of how it would fare on a bigger scale. This allows you to pinpoint any errors and make any changes in a relatively low-risk way.

What are the advantages and disadvantages of test marketing?

The pros of test marketing

You get real insights into how the product would perform in a natural marketing environment. There are many things you simply can’t predict or anticipate and the only way to highlight these issues is with a real test in a real-life environment.

You can gain an idea of how well the product will sell. This allows you to extrapolate predictions to the wider market, build more realistic budgets, gain buy-in from other members of the company, and make any changes needed.

It helps you determine the most suitable and effective channels for marketing. A small-scale test, as long as it isn’t too small, can give you a solid idea of the marketing channels your target customers respond best to, helping you allocate your resources and effort more wisely when the product launches for real.

It helps you identify the best distribution channels and build a data-driven distribution strategy for when the product launches.

Any weaknesses or flaws in your strategy will be exposed without any disastrous consequences. This way, you can make any changes and ensure your entire plan is on firmer footing when you launch for real. Failing during a test is far more preferable to failing on a grand scale.

You’ll see how customers react to your product, marketing, and other aspects of your brand in real-life scenarios. This gives you real data to work with as opposed to theoretical predictions and second-hand knowledge based on trends.

You’ll get a heads-up if your product is going to fail. Sometimes, despite best efforts, some products simply aren’t meant to be. If your product fails dramatically in your test (due to lack of interest, for example) it may be a sign to cut your losses and move on, avoiding a catastrophe.

The cons of test marketing

Although test marketing can be useful, there are also some major drawbacks. Anyone planning to carry out test marketing should make sure they are aware of these potential cons before they begin.

It’s expensive. Doing test marketing right involves a large-scale project which measures multiple factors across your business. This means that if you want reliable results from your test marketing, you need to be prepared to invest a lot of money.

It’s time-consuming. Again, test marketing is a big project with many different layers. It takes time to set up your test, and you’ll need to run it for a while before you get reliable results. This can delay your product launch, cause frustration among the members of your project team and cost money.

Test marketing can reveal your game plan to competitors. In a test-marketing project, you are revealing not just your product but also multiple crucial aspects of your marketing strategy in the real world. It’s very easy for competitors to view this and simply copy it with their own product before you even get close to launching.

The results can be misleading. With test marketing, there is a lot you need to get just right to yield useful results. If your sample size is too small and narrow, you’ll end up with a one-dimensional view of your market which doesn’t reflect reality. The channels you use to market your product and collect data might exclude certain demographics, too.

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Test marketing vs concept testing: which is best for me?

Test marketing and concept testing share many things in common, but they aren’t interchangeable. In this section, we’ll break down the similarities and differences between the two and help you work out which one is best for your situation.

The similarities

Both test marketing and concept testing are designed to learn about your product before doing a full launch.

Both can be effective ways to reduce the risk of failure, gain valuable insights about your product, and make necessary changes before a full launch.

Both require you to plan carefully in advance and make sure everything is set up right to get the most accurate and reliable results.

The differences

Despite their similarities, concept testing and test marketing are two very different processes. Let’s take a look at the things that separate them:

Concept testing is much easier to carry out. You can complete a solid concept test in a relatively short amount of time, and gain valuable insights from this.

Concept testing is more affordable. Concept tests can be done for a fraction of the cost of test marketing.

Test marketing involves launching a product in the market, even if it’s at a small-scale. As a result, it’s not suitable for early stage testing, where concept testing can play an important role.

Linked to this, concept testing can allow you to test ideas securely before launch. In contrast with test marketing your products are put into the market meaning that there is a risk of competitors getting hold of your ideas.
Test marketing is wider in scope as it takes a broader view of the entire marketing and sales process. It measures many different factors such as advertising effectiveness which can’t be evaluated in concept testing.

Which one should I use?

Whether you opt for concept testing or test marketing depends on your goals, the resources you have available, your product, where you are in the development process and your timeline, among other factors.

Concept testing is much easier and more cost effective to do than test marketing and can yield reliable results at speed. With concept testing, it’s not hard to get reliable feedback on your product and clear direction to inform actionable changes. This allows you to make meaningful improvements to your product and launch much more confidently.

Give yourself the best chance

Concept testing allows you to launch your product with the best possible chance of success. Instead of operating in the dark, guided only by guesswork and opinions, you can lean on real feedback from real customers.

At Kadence, we can help you with concept testing, ensuring your product goes to market with a strong chance of success. To find out how, request a proposal today or get in touch with your local Kadence team to discuss your options.

Concept testing is a crucial stage when developing new products. Before you launch a new product in the market, it’s important to gain a solid overall idea of how your customers will respond and how the product will perform.

This helps you avoid costly errors and nasty surprises, better understand your market, and make a more confident and successful product launch. In this article, we’ll show you how concept testing works and how to do it. Let’s start with a more in-depth definition.

What is concept development?

A concept is the precursor to every great product. It’s a detailed outline of what you’re going to produce, who it’s for, the problems it will solve, how it will work, how much it will cost, and much more.

To make sure your concept is ready to go to market, it’s essential to test it properly with real customers. This process is called concept testing, and in the rest of the article, we’re going to talk about why this is so important and how to do it methodically.

The benefits of concept testing

Concept testing is the process of testing your concept before launch, so you can confidently put it into the market with a fairly good understanding of how your customers feel and how they will respond.

There are several different methods spanning both qualitative and quantitative approaches (which we’ll dive into shortly) but they all involve presenting concepts to consumers and then getting their feedback about different attributes.

(Check out our detailed guide to concept testing for more information.)

There are multiple reasons to do concept testing, such as:

You get real feedback from users. Designers and product teams are often too close to the product to make clear-headed decisions about it, and they might overlook some crucial things. Concept testing allows you to access real feedback from your target customers, which you simply can’t replicate with your own internal team.

It helps you notice flaws. Pretty much no concept has ever been perfect. Testing your product with real users helps you notice problems that flew under the radar in the design phase, giving you many new pairs of eyes.

It allows you to refine your concept. Before testing, your product is just a rough prototype that has all the major pieces in place but probably needs some extra work. By shedding light on what consumers think, testing gives you some direction for how to refine and improve your product so that it’s more likely to gain traction when it hits the shelves.

The importance of concept testing

The above benefits are important for many reasons. Here are some of the reasons why you should consider concept testing in new product development:

It’s easier to get backing for your product. Testing gives you concrete data about how customers feel about products. You can then use this to make a compelling case to others in the organization about why you are making certain decisions. Without this data, it’s just a matter of personal opinion and it will be much harder to convince others.

It helps you find out what your customers like the most about the product. This is useful not just for that specific product and how to market it, but also allows you to make better decisions going forward by focusing on the things that people like most and targeting popular pain points with different products.

Testing can help you segment your customer base. Who should you target with your product? If certain demographics love the product and others are less enthusiastic, this is extremely helpful when it comes to focusing your marketing and distribution efforts.

It helps you estimate how many sales you’ll make and the ROI you’ll generate with the product when it goes to market. This is helpful when it comes to setting budgets, making plans, and getting financial backing from others in your company.

It allows you to identify a reasonable price point. It’s common to ask users during testing how much they would expect to pay for a product. This helps inform your decision for how much your product will sell for.

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How to test concepts: the qualitative and quantitative methodologies

Concepts can be tested quantitatively or qualitatively. Qualitative methods for concept testing include focus groups, online communities or in-depth interviews that allow you to uncover rich qualitative feedback from current or prospective customers relating to your planned product. Ethnography or self-ethnography are other alternatives, particularly if the concept you’re testing is worked up and in prototype form that consumers can interact with at home.

The main quantitative method used for testing concepts is an online quantitative survey, an approach that allows you to test at scale.

Different approaches for testing concepts

There are four main approaches for concept testing a new product, and each one has its own pros and cons. It’s best to consider your specific situation and product and then pick one which works best.

Monadic testing

This is where the audience is divided into groups, and each group is given one concept in isolation and asked to evaluate it via a series of questions.

For example, they might be asked to rate the design, evaluate the price or feedback on the packaging.

The pros of monadic testing are:

There is less room for order bias since the concepts are shown and evaluated in isolation

It’s easier for users — they only have one product to focus on and all the questions apply to that same product

It encourages deeper feedback as users take a deep dive into one concept as opposed to skimming over several different ones

On the other hand, the main drawback to monadic testing is that it requires a larger sample size to get enough reliable data. This means it can be costly to gather all the necessary participants, and challenging to find enough people to assess niche concepts.

Sequential monadic

In sequential monadic testing, multiple concepts are evaluated one after the other. Each participant sees two or more concepts, presented in a random order, and answers questions about each one in turn.

The main benefit is that fewer people are needed, so this results in:

Being cheaper to gather enough people and set up the testing

Taking less time to gather a sufficient amount of data

It also works well with niche markets where there might not be many potential customers

The main downside is that it takes longer to carry out each individual test since participants are evaluating multiple concepts instead of just one.

Comparative

In comparative testing, concepts are shown next to each other, and participants evaluate all of them at the same time. It’s an effective way to find out how one concept compares directly against another in the eyes of your customers.

The main advantage of comparative testing is that it’s good for measuring small differences and drilling down into the specific advantages and drawbacks of each product. The main downside is that its comparative nature means that it’s not very effective when both products are flawed.

Comparative testing is often used as a follow-up for monadic testing to gain deeper insights into a specific product.

Proto monadic

This is a blend of monadic and comparative testing. Customers evaluate a product via monadic testing and then are shown the same product in comparison with another.

It’s done to confirm the initial monadic results to gain a more sturdy overall conclusion about a product’s strengths and weaknesses.

What to measure

Once you have settled on a method of testing, it’s time to consider what you want to measure. There’s a long list of possible factors to analyze with concept testing, and these might vary based on your chosen method.

Here are some common examples of things to measure:

Overall reaction to the product – this measures how customers feel about the product overall, and can be measured with a likert scale (a series of options from “strongly agree” to “strongly disagree”).

Reaction to different elements of the product – you can also use the likert scale to rate certain aspects of the product, for example the packaging, ease of use, battery life, and more.

Need for the product compared to the current market – how much of a demand does your participant think there is for the product? Is there an urgent need for it, or is the market already saturated with similar products?

Comparison with other products on the market – similar to the above, how does your product compare with what’s already out there. Is it a significant improvement on what exists, worse, or just more of the same?

Likes and dislikes – what are the individual things people like and dislike about the product?

Purchase likelihood – this is where you ask your respondents to rate their likelihood of buying your product. You can use a likert scale for this (“very unlikely” to “very likely”).

Pricing analysis – how much would your participants be willing to pay for the product?

Likelihood of use– how much of a need does your participant personally have for the product, and what kind of role would it play in their lives?

(Check out this article for examples of how to test new product concepts.)

Testing your concepts is crucial if you want to release the best possible products to your target market, market them effectively, delight your customers, and see your revenue soar.

How can we help?

It’s important to do concept testing properly so your new products have the best chance of success when they eventually hit the market. To find out how Kadence can help you deliver this, request a proposal or get in touch with the Kadence team here.

In discussing market research and new product development, a famous story often comes up about Steve Jobs dismissing consumer market research as a tool for shaping new Apple products. The driving force behind the Mac, the iPod, and the iPhone famously said in a 1985 Playboy interview, “We were the group of people who were going to judge whether it was great or not. We weren’t going to go out and do market research.”

It is, of course, one of the most widely debunked stories in business. Apple does conduct consumer market research – and is, arguably, in its pre-eminent position precisely because it innovates using insights generated by analyzing in incredible detail its consumers’ behaviors and the market appetite for its products. (There’s video of a young Jobs extolling the virtues of market research for these purposes – it’s 90 seconds well spent.)

In the world of new product development, market research often reveals that most new offerings are iterations of existing products. For every genre-busting innovation, there are tens of thousands of new iterations of existing ideas, tweaks to brands, and updates to proven sellers. In most cases, some kind of market research will have shaped the new iteration and how it was conceptualized; helped stand up the business case for it; framed the marketing; and guided its introduction to consumers. So how does market research help businesses design and launch successful new products?

Integrating Market Research in New Product Development: Each Stage of the Innovation Funnel

There are lots of different ways to describe the innovation process, broadly broken down into three phases: ideas, concepts and creation. It’s not a science with a standard formula, however, but there are some common steps. For example, some experts recommend breaking the process into 5Cs:

Capture intelligence about market gaps and organizational potential.
Connect opportunities to capabilities.
Convert ideas and available resources into concepts for products.
Confirm these products are viable in the market.
Conclude by executing a market entry plan for them.

Another way of thinking about it is a series of questions that need to be asked at each stage of the product development process. Market research can help answer them all.

1: What’s the opportunity?

Desk research, analysis of existing customer data and some qualitative investigation can help frame likely areas for innovation. In many cases, an organization will face an internal problem – overcapacity, falling margins, consumer appetites shifting away from existing products – that also frame the need for new products. The output here is an extrapolation of big trends to identify emerging needs, changing behaviors and whitespace for innovation.

2: What ideas might thrive there?

In some organizations, internal R&D will have a ready supply of potential innovations that might be applied to the opportunity. More likely, R&D and marketing teams will benefit from a brief developed from the ‘opportunity’ phase to direct R&D in more concrete areas. This process might include brainstorming inside the organization or more formal ideation sessions with an external research agency. At this point surveys can be harnessed to give more shape to the ideation process. In the search for an iterative new product (rather than a genuine technological innovation) there might be 30 broad ideas that can be tested in quantitative surveys to thin down the field.

3: What concepts deliver on those ideas?

In the next stage, focus groups and market analysis can clarify which concepts ought to progress further by exploring the strengths and weaknesses of each idea. This is also where the innovation and R&D efforts of the business are properly moulded around consumer and market insights – and some iteration takes place to align the two. Note that research here isn’t just among consumers in the core market. Channel partners, consumers and suppliers in adjacent industries are all valuable sources of insight and inspiration. For example, when Kadence worked with an airline to develop new first and business class seats, we looked to bedding experts, audiophiles and high-end restaurant maîtres d’hôtel to shape the concepts.

4: How might those concepts perform in the market?

By this point, an organization should have narrowed its ideas down to a small number of solid concepts. At this stage, a large-scale quantitative survey can be used to identify the concept with most potential to take forward, as well as the size of the potential customer base.

5: What’s the investment case for launch?

The insights gained from market and concept testing will allow numbers to be attached to the product at this point. What might revenues be? What’s the cost to produce the product or service? With research around pricing, what’s the margin likely to be? Does this justify retooling a factory or investment in marketing? This is the “go/no go” point for a new product.

6: What should the final product look like?

Using the research on market potential and consumer attitudes to the new idea, a business can shape decisions on final feature set, ancillary products or services (again, both quant and qual market research will illustrate the need or potential for these), packaging, marketing and pricing.

7: How do we get it out to market?

Research can also highlight optimum product launch strategies, including distribution, adverting and partnerships to make the most of both existing markets and potential follow-ons – whether that’s mass-market adoption for a product designed initially for a niche or early adopters; new demographic segments; or launch into different international markets.

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The known unknowns for new products

There are broadly two types of business keen to answer these questions. First there’s the radical innovators, the people who come up with brand new ideas and product concepts and want to understand whether they stand a chance in the market. This group are interested in ‘unknown unknowns’, the broader trends in consumer behavior that might hint at acceptance of a brand new idea. We’ll come on to these Steve Jobs types later.

The second, much larger, group understands the innovation funnel in more detail and seeks data to optimize a pipeline of new products. They are interested in ‘known unknowns’ and using the answers to justify, shape and execute a launch.

For this group, the challenge is modelling the potential performance of a new product against a number of variables already visible in the market. These organizations often have a sophisticated process in place to test new ideas and are keen to benchmark any new product in order to validate investment. They will have an algorithm for product development. The more variables they can pin down using market research, the higher the confidence in making those investments.

‘Benchmarking’ in this case might be looking at the performance of products within the target market; or evaluating consumer attitudes to particular features or benefits. This makes it a largely quantitative methodology.

This kind of quantitative approach is often applied with good reason. Standardized questionnaires and clear, consistent methodologies can help ensure that the market research process is more reliable and easier to interpret. And for many larger organizations with a wide portfolio of potential innovations, a fixed investment budget and the need for reliable returns, this rigour can be highly valuable.

But beyond simply looking at the “go / no go” result, it’s important to dig into the reasons why products didn’t pass this hurdle. This can provide valuable insights to inform future development.

Competitor analysis can also reveal opportunities for developing successful product iterations. Research might include:

Rivals’ marketing strategies – what’s their targeting and messaging; what are they missing?
Customer satisfaction with competitor products– where are there discontents that might be satisfied by your product?
Other gaps in the market – such as different price points or localized versions for international consumers.
Other competitor strengths and weaknesses – consider brand halo effects or financial status.
Early-adopter behaviors – in similar markets or using new technologies that might be adapted to your own target markets.

Learning from History: New Coke as a Case Study in New Product Development Market Research

But it’s not always done right. There’s no shortage of case studies of new product launches that didn’t go well. And often that’s not because an organization didn’t do any market research. It’s because they didn’t use it deftly enough.

New Coke is a great example. Coca Cola is an innovative business and wields one of the greatest brands in history. In the 1980s, management decided to rebuild its dominant position with a new formula. Clearly this was a huge decision, and as a market research powerhouse, it took no risks. It spent $4m on development and conducted over 200,000 taste tests across the US to research how consumers would score the new flavor against rival Pepsi. And based on those tests, New Coke was going to be a hit.

But management made a series of errors. In a classic case of confirmation bias, they tended to put more weight behind positive views expressed in focus groups, ignoring those who warned a change would turn them off the brand. They discounted emotional feedback on their brand. And they over-focused on differentiation with Pepsi, which had long marketed itself as the sweeter product.

One big mistake was conducting sip tests instead of researching how consumers would feel drinking a whole can of the sweeter formulation. But narrowing down their research focus – ignoring the context for consumption – they ended up launching a product that turned consumers off the brand altogether.

The error, then, was not failure to conduct market research. It was failure to treat research objectively and apply appropriate methodologies. Management sought justification for their decision – not confidence that it was the right one.

The impact of market research on new product development – giving you the confidence to guide a product launch

The key word here is ‘confidence’. Even iterating an existing product entails risks. Using market research for product development helps reveal and manage that risk – and allows decision-makers to test rigorously against hypotheses for new products, rather than head off down potentially blind alleys.

Note that qualitative research plays a crucial role in helping product developers fine-tune their approach and create innovations more suited to particular audiences. And as the New Coke example shows, qual research can capture the emotional components of product change much better than quantitative analysis might. Every new product launch is a balance between gains and losses for the consumer and understanding that balance is vital.

When it comes to qualitative research, organizations shouldn’t just ask themselves whether to conduct it, but how to conduct it. Whilst central location testing for instance, allows you to ensure the product is experienced in a consistent way during the testing process pandemic lockdowns have obviously accelerated this shift towards at-home testing. New technologies are helping. Augmented reality (AR), for example, is an ideal way to help consumers visualize new products even at the concept stage. Using their mobile phones, they can ‘see’ products in their own home or a work setting, providing valuable depth to qualitative studies at even earlier stages. This is something we’ve piloted with Asahi to test their London Pride packaging and are seeing a number of benefits, such as respondents using AR organically noticing and commenting on small visual details that aren’t picked up by other respondents assessing a 2D concept.

Using market research to guide blue-sky thinking

Our market research for new product development includes testing against quantitative benchmarks to validate each phase of product innovation. Additionally, our qualitative studies in new product development market research focus on testing the emotional reaction to new products, shaping their evolution for market success. A third aspect of market research in new product development is ideation – generating new ideas at the outset.

This is often called ‘ideation’ and it’s an area where market research has played a key role since the birth of the industry – regardless of what Steve Jobs said. He was right that consumers are typically quite poor at predicting what might define or satisfy meet their own future needs. But understanding how R&D and human appetites come together is core to the market research offering.

Take a dairy business, as an example, that’s facing a slow decline in consumption. One solution would be to increase the appeal of organic products. How might they craft a brief to their own product development team?

Working with Kadence, the company use a structured approach to frame where this innovation might gain some traction in the market. Using proven research techniques, they also explored possible options for further innovation. These can be tweaked and repositioned using further research.

This approach can be further optimized if like us, the research agency has an in-house creative team that can quickly visualize concepts based on consumer feedback. We worked with a global beverage brands wanting to relaunch its range to make this happen. Based on focus groups, we were able to redesign the packaging in a matter of hours in a way that capitalized on insights from the research.

One other process to consider: the ideation sprint. Rather than gradually piecing together some R&D, market analysis and internal feedback before gradually building out a new product for consumer testing, this involves getting all the stakeholders into a project group together to develop new ideas within a short timeframe.

Kadence has conducted these sprints with food manufacturers – where that combination of chefs, technicians, marketing experts, salespeople and researchers working in concentrated bursts over a couple of days can see a menu of ideas created, tested with consumers and refined incredibly quickly. And because these sprints are cross-departmental, buy-in for the new product internally is much greater.

Concluding thoughts

Product development is risky even when you’re not launching a category-busting innovation or changing the world. New flavors, revived branding, tweaked feature-sets or version updates can upset existing product performance or result in costly investment in ideas that might not fly.

Far from stifling product development, market research can deliver reassurance and confidence at every stage, helping inform the choice of new products to pursue, their key attributes, how they might be marketed and what contribution they make to a business operationally and financially.

This is an area where Kadence has extensive expertise. Find out more about our product development research services or contact us to discuss how our market research can optimize your new product development brief.

Marketing textbooks are filled with examples of products or services that flopped when they hit the market.

Take Juicero, for instance. Investors pumped a staggering $120 million into a Wi-Fi-connected juice maker that nobody indicated they wanted or needed. Unsurprisingly, it was scrapped within two years.

Or consider ESPN’s mobile phone service, priced at $400 and lacking handset choice for the target audience. The service was swiftly shut down, and ESPN opted to provide content to Verizon instead.

And who could forget New Coke? Launched in 1985, it remains a major marketing misstep. After only a few weeks, Coca-Cola abandoned the product and reverted to its old formula.

Even some of the world’s most innovative companies have failed to foresee the impact of new launches on their target market. Google, for example, arguably launched its wearable Google Glass concept too soon. Its high price did not help, and it failed to connect with consumers.

Fortunately, there is a way to avoid such failures. By conducting product concept testing as part of your market research process, businesses can develop their ideas in a safe and controlled space with the target audience.

What is Concept Testing?

Concept testing involves presenting potential product concepts or ideas to a target audience and collecting feedback to assess market potential. The concept can be a new set of product ideas, a redesign, or a rebrand.

Let’s look at a product concept example. A fintech company developing a new budgeting app might present mockups or a basic prototype to test the product’s perceived usefulness, ease of use, and willingness to pay. This sample of product concept allows businesses to fine-tune messaging, pricing, or functionality.

Testing methods can be online, such as quantitative surveys or online communities focused on qualitative insights, or face-to-face, such as focus groups or in-depth interviews. This combination ensures you hear both the “what” and the “why” from your target audience.

In market research, concept testing helps avoid the trap of internal bias. It allows businesses to validate assumptions, test resonance, and measure purchase intent in a realistic, low-risk environment.

The Role of UX Designers

UX designers play a crucial role in concept testing by employing user-centered design principles. They create interactive prototypes that simulate the user experience, allowing participants to engage with and provide feedback on proposed concepts. UX designers ensure that concepts are intuitive, usable, and aligned with the target audience’s needs. They facilitate user testing sessions, observe interactions, and gather valuable insights to refine the concepts.

The Importance of Concept Testing

1. Concept Testing Helps Filter Ideas

Concept testing helps you move beyond blue-sky thinking and determine which ideas will be a hit. It provides data that can bring the whole team on board by providing consensus on which projects to develop and which to shelve.

Great concept testing unites teams behind ideas with real potential, eliminating the need for office politics or frustrating ‘design by committee.’ With concept testing, you hear directly from consumers about what will work and what won’t.

Using a range of qualitative and quantitative techniques, you can understand the consumer view of different concepts and explore whether the types of products or services you want to develop will resonate. Employing a range of testing tools enables you to identify the product concepts with the highest appeal and understand how these can be refined. This allows you to move to the next stage of development with confidence.

It’s no overstatement to say that a well-designed, concept-testing survey or a skillfully moderated online community can pave the way to success. But any survey template or discussion guide needs to be designed to ensure that the overall package, as well as individual features or attributes, are each assessed and fed back on.

This is something that needs to happen in the early stages of decision-making. It cannot be left too late, as concept testing aims to help you iterate your ideas and tweak them ahead of launch so that they are primed for success.

2. Concept Testing Prevents Bad Decision-Making

Testing concepts in detail before launch may seem like it delays your go-to-market strategy, but it saves significant time and financial losses in the long run. Failed products or services are costly, but concept testing helps you avoid bad ideas and uncover those with untapped potential.

This is especially true in financial services. Consider the launch of a new digital insurance product. If consumers don’t understand the value or find the interface confusing, the product fails before it begins. Through concept testing, businesses can refine design, copy, and pricing for greater appeal.

Concept testing helps you find the strongest option to take forward or improve underperforming concepts, ensuring your plans have a solid chance of success. In this way, concept testing can help you avoid an embarrassing failure and take your product development processes from good to great, thanks to that all-important feedback from those who matter most—your customers.

3. Concept Testing Identifies Key Elements

Even if you gauge that your product ideas will fly, there are additional considerations, such as positioning, packaging, branding, and pricing. Concept testing optimizes your innovation, reducing the risk of project failure and limiting excessive costs.

It can shed light on blind spots, inefficiencies, misinterpretations, or problems that can lead to failure. Using concept testing methods like surveys as well as qualitative research via a focus group, in-depth interview, or online community can all help to tease out your target audience’s wants or needs.

4. Concept Testing Fixes Problems Early

The sooner concept testing is undertaken, the more flexibility you have to optimize your initial idea. Concept testing helps you understand what elements don’t work, allowing you to refine ideas swiftly based on consumer feedback.

With an online community, for instance, it’s possible to develop concepts based on consumer feedback and then upload them for further feedback, allowing you to improve iteratively. This flexibility is especially useful in crowded markets, where subtle changes can shift market perception significantly.

5. Concept Testing Ensures Market Fit

Concept testing puts the consumer voice at the heart of product development, ensuring new products resonate with customers and increase business performance. It helps you identify pain points or delights relating to new ideas, establish how your product fits into the lives of your target audience, and determine which concepts they would be willing to pay for.

Good concept testing means getting under the skin of your customer and letting their feelings and needs guide you toward the solutions with the most potential. By putting consumers central to product development, you can develop products and services that outperform the competition.

Concept Testing in Financial Services: Real-World Examples

Financial services may not seem like an obvious space for product innovation, but concept testing has played a pivotal role in the development of successful offerings in fintech, banking, and insurance. When consumers are asked to trust a company with their money, market research concept testing becomes even more critical.

Monzo’s Early Concept Testing with a Waitlist Model

UK-based neobank Monzo began testing its digital banking concept by launching a beta version with limited functionality in 2015. Rather than building out the full platform, Monzo focused on a single-use case—spending via a prepaid debit card—while capturing feedback from early adopters through in-app surveys and community forums.

This deliberate form of concept testing in market research allowed Monzo to validate demand for a mobile-first banking experience before securing a full banking license. By the time of its official launch, over 200,000 users were already on the waitlist—proof that the product concept had strong market appeal.

Fidelity’s Robo-Advisory Rollout

In the US, Fidelity Investments conducted detailed concept testing before launching its robo-advisory platform, Fidelity Go. Rather than assuming that younger investors would adopt automated financial advice tools, Fidelity ran qualitative research to explore trust levels, perceived value, and platform usability.

Their findings led to changes in onboarding language, interface design, and fee structures before rollout. This research-first approach to business concept development helped Fidelity Go gain traction without cannibalizing their core advisory business.

AXA’s On-Demand Insurance Pilot

In Southeast Asia, AXA Affin piloted on-demand travel insurance that could be activated for short periods via mobile app. This product concept example was tested through user panels in Malaysia and Singapore to understand feature appeal, pricing preferences, and willingness to buy micro-coverage.

The concept testing revealed that consumers wanted automatic trip detection linked to travel bookings and simplified claims processes. These insights led to a refined offering that better aligned with digital-native expectations in the region.

FAQs About Concept Testing

What is a product concept example?

A product concept example might be a rough sketch, prototype, or idea for a new service—such as a wearable payment device or a subscription-based investment platform—presented to users for feedback before full development.

How do you test a product concept?

Product concept testing can be done through online surveys, one-on-one interviews, focus groups, or moderated online communities. These methods assess appeal, clarity, usability, and purchase intent.

What are the best methods for concept testing?

The best methods combine both qualitative and quantitative approaches. Surveys offer measurable data, while interviews and communities explore the “why” behind reactions, offering richer insight.

Why is concept testing important?

Concept testing validates your idea early, prevents costly mistakes, and helps refine features or messaging to better align with market needs. It increases your chances of product success.

What’s the difference between qualitative and quantitative testing?

Qualitative testing explores opinions, motivations, and behaviors through open-ended questions. Quantitative testing measures attitudes or preferences at scale, often using structured surveys for statistical insights.

Ready to Test Your Next Product Idea?

Concept testing gives businesses a structured and powerful way to reduce risk, prioritize investment, and bring to market ideas that align with consumer needs. If you’re looking to integrate concept testing into your product development process, our team can help you design and implement a research program that delivers actionable insight.

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Every product starts as a possibility. Whether it addresses a gap in the market, meets an unmet need, or offers a better alternative, it remains just an idea until tested. A product concept is only as strong as its reception—something no internal brainstorm can predict with certainty.

Why Concept Testing Matters

Concept testing offers a structured way to reduce that risk. Using both qualitative and quantitative research, businesses can explore which features connect with consumers and which fall short. Learn more about what concept testing involves in new product development.

Product Testing Examples That Deliver Real Insight

Product testing examples range from online surveys to in-depth interviews and digital communities. Each method captures how real people respond to a product concept before launch. These are not theoretical exercises. They show how a sample of your target market evaluates an idea, long before it reaches the shelf or app store.

Why Early Testing Shapes Stronger Product Concepts

Early feedback sharpens both product and messaging. Bringing consumers into the process before a prototype is built or campaign drafted saves time and prevents costly missteps. When the results are clear, so is the next move.

Even small features can influence how consumers perceive value. What feels minor in a meeting room can shift behavior in the real world. Testing a product concept is about more than validation—it’s about learning what matters most to the people you aim to serve.

From Product Concept to Market-Ready Idea

Behind every compelling product concept example is a period of revision. Research informs development, highlighting where the idea holds promise and where it needs work. At Kadence, we’ve helped leading brands turn early-stage concepts into successful, market-ready offers by asking the right questions at the right time.

How to Test a Product Concept Effectively

So how do you test a product concept in a way that leads to decisions, not just data? The following product testing examples show how to gather meaningful feedback early. Whether you want to compare concept variations or hear directly from a sample of your target audience, these five methods are designed to support confident, evidence-led development.

1. Use Online Surveys to Measure Concept Appeal and Identify the Strongest Ideas

Online surveys remain one of the most effective ways to test product concepts at scale. They allow brands to reach a targeted audience and gather direct feedback on which ideas resonate most. By presenting multiple versions of a product concept, businesses can quickly identify which direction holds the most potential.

Survey design is critical to getting useful results. Questions should measure perceived value, relevance, and willingness to pay. A well-structured concept test can also reveal the size of the potential market and clarify how useful the idea feels to consumers.

Just as important is who you ask. A product concept example that performs well with the wrong audience tells you little. Responses should come from people who match your target market based on demographics, geography, lifestyle, or occupation.

Likert scales are commonly used in concept testing to measure how strongly consumers value particular features. These responses can be segmented and tracked to see which product attributes matter most to different audiences.

In addition to gauging overall appeal, survey-based product testing helps identify which groups are most receptive. Differences in age, location, or behavior can point to valuable insights about where and how to launch.

2. Use Conjoint Analysis to Identify the Features That Drive Preference

While direct feedback on overall appeal is useful, it often doesn’t reveal which specific features influence consumer decisions. That’s where conjoint analysis becomes valuable. As a product testing example grounded in statistical design, it helps uncover which attributes matter most to your target market.

Conjoint analysis works by asking participants to evaluate different combinations of product features. Rather than rating each one in isolation, respondents compare trade-offs—such as price versus functionality, or design versus sustainability—and indicate which combinations they prefer. This method mirrors real-world decision-making more closely than standard surveys.

By examining how consumers prioritise features, conjoint analysis provides a clearer view of what they value and what they’re willing to sacrifice. These insights help teams separate core features from optional ones, making it easier to decide where to focus investment.

The design of the exercise matters. If too many variables are introduced, the task becomes tiring and data quality suffers. Keeping it focused ensures the results remain actionable and relevant.

Used well, conjoint analysis can turn a vague product concept into a sharply defined offer. It’s a proven way to test not just what consumers like, but why they prefer one version of a concept over another. That level of detail is essential when refining a product before launch.

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3. Use Qualitative Research to Refine Your Product Concept with the Right Audience

When it comes to understanding how your product concept will land in the real world, qualitative research remains one of the most powerful tools available. It allows brands to go beyond surface-level preferences and explore how consumers interpret, feel about, and respond to an idea in depth.

Focus groups are a foundational method. Whether conducted in person or through online communities, they provide space for guided discussions where participants can engage with product concept examples directly. These sessions often involve reviewing prototypes, visual mock-ups, or feature descriptions, and can uncover emotional responses, concerns, and points of confusion that a structured survey would miss.

Online qualitative platforms now offer even greater reach and flexibility. Participants can provide feedback on a product concept over several days, complete guided exercises, or respond to follow-up questions, all within a digital environment. These platforms are especially valuable when testing across geographies or when working with a niche audience.

In-depth interviews complement group sessions by allowing researchers to explore individual reactions in more detail. This approach is especially effective when testing complex or B2B-oriented product ideas. With more time and a tailored discussion guide, interviewers can probe deeper into feature perceptions, usability assumptions, and purchase motivations.

What unites all qualitative methods is the ability to explore why people feel the way they do. Open-ended questions are critical. Rather than asking which feature ranks highest, the focus should be on which parts of the concept feel useful, believable, or unnecessary. You might ask:

“What problem does this product solve for you?”
“Is anything missing from this concept?”
“How would you describe this idea to someone else?”
“Which features would make you more likely to buy it?”

These discussions not only inform which features to prioritise but can also shape messaging, naming, packaging, and positioning. They provide the language your customers naturally use when talking about your offer—language that should carry through into marketing and UX design.

A well-run qualitative study will also help you define your product’s edge. It can highlight gaps in the market or reveal objections that need to be addressed early. In this way, qualitative research becomes a testing ground for product-market fit, well before development costs escalate.

4. Use Iterative Testing to Evolve the Concept Before Launch

Testing once isn’t enough. The most successful product concepts are shaped through a series of refinements based on real feedback. Agile, iterative testing gives brands the flexibility to improve their ideas in response to what consumers actually say and do.

Online communities are particularly well suited for this approach. These platforms allow participants to engage with your product concept at different stages—reacting to early visuals, responding to copy, reviewing revised prototypes, and offering feedback in cycles. This makes it possible to test, adapt, and retest ideas with the same or new groups of users.

For example, participants might be shown an initial product description and asked to highlight what excites or confuses them. After revisions, a new version is shared to see whether the updates improved clarity or appeal. Image markups, video feedback, and comment threads can all be analysed to understand where the concept is gaining traction and where friction remains.

This method mirrors real product development, where adjustments are constant. It also reveals how perceptions shift over time—whether the concept grows stronger with refinement or if interest fades with repeated exposure.

Even after launch, this kind of feedback loop remains valuable. Early users often uncover pain points or opportunities that weren’t obvious during the testing phase. Continual input from your target market helps fine-tune features, improve communication, and drive post-launch iteration.

Iterative testing turns product development into a dialogue, not a one-off pitch. It reduces guesswork and keeps you aligned with your audience at every step.

5. Bring Product Concepts to Life with Visual and Emerging Technology

Product testing examples that include visual stimuli consistently perform better. To get meaningful feedback, respondents need to see and understand what you’re proposing. That’s why it’s essential to translate early ideas into clear, engaging formats before testing.

Mock-ups, 3D renders, packaging designs, and video walk-throughs all help communicate the product concept clearly. They offer a sample of the product experience, allowing respondents to imagine how they would use it, where it fits in their life, and whether it feels relevant. The clearer the picture, the more reliable the insights.

We also see increasing value in immersive testing methods. Augmented reality (AR), for example, allows consumers to interact with a product prototype in a real-world setting using their phones. A digital appliance can be visualised on a kitchen counter. A piece of furniture can be placed in a home office. This adds context to feedback and improves the quality of the response.

Using these tools doesn’t just improve recall—it helps brands uncover deeper emotional responses. Seeing a product in context often sparks reactions that written descriptions never would. That’s why visualisation should be considered a core part of concept testing, not an afterthought.