Just like reaching an unknown destination without a map is difficult, so is building a business strategy without competitive intelligence.
Competitive intelligence helps brands shape their product development, distribution channels, pricing, messaging, positioning, brand promotions, and features. It allows brands to identify their challenges and opportunities in the market in relation to their competition, so they can see what their competitors are doing and differentiate themselves from them.
What is competitive intelligence (CI)?
Competitive intelligence refers to any intentional research where brands collect, analyse, and utilise data and information gathered on their competitors, customers, and other external factors, potentially providing brands with a competitive advantage.
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When brands ethically and legally collect competitive intelligence, it can help boost the organisation’s decision-making capabilities. The goal of any competitive intelligence study is to create a business plan and strategy so organisations can make well-informed decisions based on market considerations.
Competitive intelligence goes beyond knowing the competition; the process is designed to take a deep dive to unravel the finer points of the competitor’s target markets and business strategy.
Competitive intelligence plays a vital role in all major departments of an organisation and can take on a different meaning for each department or function. For instance, for a product development team, competitive intelligence may mean new features being added to products. For a sales executive, it may be helpful to know how to create a winning proposal. For leadership, it may be understanding the competitor’s marketing strategies so they can craft a plan to gain more foothold in the market.
Competitive Intelligence studies and exercises can be tactical (shorter-term) or strategic (longer-term). The goal of tactical competitive intelligence studies, for instance, can be to obtain insights into increasing revenues or gaining market share. At the same time, strategic or longer-term reporting focuses on significant risks, threats, and opportunities, present or emerging.
A competitive intelligence study typically includes a wealth of information and insights from various sources, like government records, online mentions, social media, trade shows and journals, customer data and interviews, and traditional news media, to name a few. These sources are easily accessible and form the starting point for the studies. More in-depth information from distributors, suppliers, competitors, and customers is needed to make truly informed decisions.
What are the key benefits of competitive intelligence?
There is no substitute for Competitive intelligence research when it is undertaken with care and diligence. It is a powerful tool for brands to gain market share, boost revenue, and continue to build the right products at competitive prices.
Here are some key benefits of using competitive intelligence for brands:
#1. Ability to predict patterns and emerging trends
As brands excavate an enormous amount of data and insights related to their competitor’s activities, they begin to identify and foresee emerging trends in the industry. This allows brands to gain deep foresight to make informed decisions and strategic business plans.
#2. Aids in brand positioning
As brands gather insights and data about the competitive landscape, they also gain clarity on their activities and messaging. It helps them understand what works and doesn’t and cement their marketing.
#3. Helps make more informed decisions.
When brands unearth information, they gain critical insights into how the customers feel about their brand and the competing brands. This gives brands a better view of their customers’ wants and how their competitors are meeting the needs of the target markets.
#4. Boosts returns and profits
When you have a good understanding of the strategies and tactics employed by your competition and how they are performing, you will be better able to invest in areas that bring the highest returns, reducing risks and boosting profits.
Going back to the definition of Competitive Intelligence, we can see three necessary steps: “collect, analyse, and use competitor and market information to make informed decisions.”
Collecting data
There are many ways of unearthing relevant competitor data legally and ethically. Searching for information online may seem rudimentary, but it can provide invaluable information about the competitors and their activities. This information is readily available and accessible on the internet and is considered low-hanging fruit. With a few simple web searches, you can find great information on what the competitor is doing and what it has done in the past. You can also learn about product features, pricing, innovations, leadership, and important news and announcements relevant to your competition. There are tools that provide insight into the competitor’s search engine optimisation activities and their online advertising efforts.
From here, brands often go deeper and beyond the internet to analyse target markets and customer segments. Brands use quantitative and qualitative market research to gain more market insight.
Brands use data to analyse their competition beyond the simple search process. This entails going through endless data and making sense of it all can become cumbersome. This is where data mining comes into play. Besides gathering data from third-party sources, brands also gather human intelligence by interviewing relevant people, including customers and past suppliers. This is a time-consuming process and must be undertaken by experts in market research to ensure it is done ethically and legally.
Analyzing data
Analysis of data is a crucial step in the competitive intelligence process. Once brands collect data, it needs to be analysed carefully to provide actionable insights. This allows brands to understand the patterns and separate them from the outliers.
The analysis aims to uncover strengths, weaknesses, opportunities, and threats as they relate to the competitive landscape. Therefore, collecting and analyzing information from disparate sources is essential in verifying their authenticity and validity. This helps us move away from making assumptions and gaining real insights from more accurate pieces of data.
Crafting a strategy
Once a brand has enough verified data and information on its competitors and strategies, it can utilise it to differentiate itself and make informed decisions regarding product, price, messaging, and other essential aspects. It allows brands to weigh the competitor’s strengths, weaknesses, and opportunities in relation to their own to gain a competitive advantage.
For instance, pricing is an important area for differentiation but can only be done right if everything is studied and taken into account to find the right price that is profitable and aligns with the customer’s perceived value of a brand or product offering. Therefore, a successful price is not about pricing your product at the same or lower price than your competitor but positioning your brand as the choice that provides the greatest value. And to make that happen, you need to know the price of competing products and their perceived value in the buyer’s mind. This calls for a thorough study and analysis of the competing products, markets, and consumers.
To get the complete picture, brands may conduct competitive intelligence surveys. They can define their target audience and use various demographic and psychographic questions to identify consumer behaviour. These also include questions about competing products and services. You may also use ranking and rating type questions and identify any unmet needs or gaps in the marketplace or use open-ended questions to get a more in-depth view of the consumer’s mind. Brand recall and recognition surveys are also helpful in gaining consumer perception of various brands. For instance, a sparkling water brand may ask: “When you think of bottled sparkling water, what brand comes to mind first?” This can help brands discover how frequently their brand is mentioned compared to competing brands in the category.
When armed with the powerful insights gained through competitive intelligence, brands can be more strategic in all aspects of business, from product development to pricing and distribution. By differentiating themselves from competitors, they can gain valuable market share, grow brand value, and brand equity, and boost their return on investment (ROI).
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You’ve likely heard the term “agile decision making” in the business world, but what does it mean with reference to market research?
Agile market research is gathering consumer feedback quickly by utilizing technology at any point so you can discover, experiment, understand, and make decisions with more reliable and quick data.
An agile market research methodology is a strategic approach that aims to address the continuous change in consumer behaviour and market trends as quickly as possible to deliver fast growth and improve Return On Investment (ROI).
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Agile research is an approach to market research where feedback is collected continuously and quickly. This allows brands to test, iterate, and adapt their concepts using data and facilitates innovation.
Brands leverage agile market research methodology to create products and messaging that resonate with consumers and have a customer-centric approach.
Traditional Market Research vs. Agile Market Research
Traditional market research includes stages such as project kickoff, design, review, analysis, and reporting. Every step in the process has a time limit before moving on to the next phase.
On the other hand, agile market research starts small and proceeds in steps that build on the previous one. With agile market research, researchers gain more insightful consumer experience (CX) feedback faster and at a lower cost.
Moreover, the research tasks are not time-bound, and consumers are free to respond as they like and on their own time. The seamless integration makes agile market research a shorter process, improving overall CX.
While traditional research methodology has its place in assessing customer feedback, agile market research helps move teams faster because they receive responses quickly across design stages. It also allows brands to pivot rapidly and will enable teams to act upon the data and insights quickly. That way, teams are not wasting time and effort on something that will fail when released.
How to get the best out of your agile market research
For brands to get the most out of your agile market research, they need to be mindful of a few points detailed below:
It is critical to always begin with strategy and first understand the objectives of your agile market research methodology. This will help you utilise consumer feedback and insights more effectively.
Ensure your team has the skill set for the agile research tasks that need to be done.
Utilise an efficient, fast, and user-friendly software that empowers you to conduct, analyze, and report data that supports your agile market research methodology effortlessly.
Three Ways Agile Market Research is helping brands obtain the rich insights they need
Faster Insights
The number one advantage of using agile market research is speed. Agile market research removes the friction that can slow traditional research studies to provide quick, helpful feedback that allows iterative improvement.
With agile intelligence, brands can anticipate consumer behaviours faster and more accurately. This allows the data team to focus on more innovative efforts that help grow the organisation.
All the time spent creating a questionnaire is reduced, sampling is automated, and fieldwork is done quickly. The analysis is presented rapidly, and the process is efficient and seamless.
Smarter Insights
Artificial Intelligence helps provide smarter insights in a fraction of the time taken by traditional research.
Since it provides immediate data sets, agile intelligence offers brands powerful insights, answering critical questions like how to segment buyers, which products are likely to perform best, and which locations to open or close physical stores.
Greater accessibility
Another benefit of agile market research is how it makes insights more accessible. Agile market research allows results from a series of similar projects to be shared with your teams worldwide. Other team members can learn what was done and worked, which helps inform future brand decision-making.
It democratises data and helps create seamless connections to various organisational functions, allowing for collaboration so each department can achieve its individual and overall business goals.
For example, for physical stores, marketing teams can work with real estate teams to identify areas where they should decrease or increase their presence based on store performance and other factors.
With agile market research, brands can test concepts with a target audience, generate a prototype and get feedback, or gauge consumer response to an ad campaign much faster than if they followed the traditional research process.
Agile market research seamlessly integrates various data collection tools, offering a shorter response process and improving the overall experience.
Agile market research helps brands invest in the right tools for decision-making to adapt quickly to market changes. It allows brands to transform data into an actual business asset. When armed with the correct data faster, brands can keep up with the speed of change.
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Journaling or writing in a diary is an age-old process researchers use in qualitative research to become familiar with the participants before a focus group. While this methodology helps capture deep insights from people’s daily lives, it is a time-consuming and laborious process.
So how do you get rich data and insights without going through reams of paper?
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What are mobile diaries?
As the name suggests, a mobile diary is an online qualitative research tool that enables researchers to gather data from respondents via a mobile-friendly format like an app, email, or text over an extended period.
In most cases, researchers ask users to complete a pre and post-survey to gauge changes in perspectives before and after the mobile diary surveys.
How do mobile diaries work?
Mobile diaries ideally work in small groups of preselected participants, and typically, here’s what the process looks like:
The market researcher selects a smaller group of participants from the online survey panel and sends them instructions.
Participants use a mobile diary tool to upload photos and videos about their perceptions, attitudes, feelings, behaviours, and daily lives.
Researchers review and interpret the data for insights.
Mobile diaries are a time-saver for market researchers
Mobile diaries allow market researchers to collect and process more responses than traditional methods like paper journaling.
But this is not all; there are many other advantages of mobile diaries in market research over traditional methods. This tool allows market researchers to collect highly personalised, reliable, and accurate data. Additionally, participants can effortlessly share photos, videos, audio, and text, so researchers capture the emotions behind behaviours and attitudes.
This information is not easy to capture through traditional diaries or journaling as people won’t always have a pen and paper to jot things down but (almost) always have their mobile phone on hand.
Three reasons mobile diaries are a better alternative than traditional methods and tools:
Record “in-the-moment” responses
Mobile diaries provide qualitative data that allows researchers to peel through the layers and record the respondents’ experiences when interacting with or using a product. For instance, when researching a particular meal kit service, the researcher can frame the questions to gain valuable information and insights into who they are, what they do, who they are with, and how they feel, so there is a context to the story. Mobile diaries, therefore, bring researchers closer to their users’ daily lives.
Reduce the time, money, and effort
Mobile diaries improve efficiency by reducing the cost of printing and distributing surveys. They save researchers time as they don’t have to work through reams of paper.
Enhance productivity
They provide the researcher with the tools to review the results in real-time and enhance productivity and efficiency.
The difference between a Mobile Ethnography and a Mobile Diary
A Mobile Ethnography is a qualitative research method that allows users to respond to research questions and share information using an app on their phones.
Therefore, a mobile ethnography enables “in-the-moment” responses and real-time tracking, reviewing, and moderating like a mobile diary. It also captures emotions and has the shareability factor. Mobile ethnographies can be used to evaluate user behaviour and response to advertising messages.
However, unlike a mobile diary, it lacks desktop capabilities, which limits the use of mobile ethnographies. In addition to responding to online surveys, mobile diaries enable users to log in to a desktop and participate in surveys, discussion forums, and focus groups.
These additional engagements can be invaluable for market research and provide rich nuggets of information to market researchers.
When should you utilise mobile diaries?
Mobile diaries are invaluable when collecting contextual and qualitative insights for market research.
For instance, a mobile diary would be a good tool for researching the buying behaviour of working moms aged 30-45 years.
Mobile diaries can present broad or targeted information depending on the nature and scope of the market research study.
Mobile diaries are widely used for:
Demystifying user behaviour such as online shopping habits.
Understanding user experience and interpreting user interactions with a website, product, device, or app.
Understanding how people search for and share information online or on specific topics like adopting a rescue animal.
Four examples of the use of Mobile Diaries in Market Research:
Use case 1
A grocery store brand wants to collect meaningful data on consumer experience. The researcher recruits a select group, and they have to enter their experience in a mobile diary every time they visit the store.
Use case 2
A juice brand wants to learn more about its customers’ habits. They use mobile diaries to collect insights on when their customers drink juice, their favorite flavors, and other ways they use juice, such as in cocktails.
Use Case 3
A high-end shampoo brand is rebranding and has new packaging. A select group is asked to answer questions regarding the packaging, dispenser, look, and feel of the packaging and the product.
Use case 4
A meal delivery service has launched an app and wants to test the user experience. A select group of people uses a mobile diary to answer questions on how easy it is to navigate and the overall experience.
Challenges presented by mobile diaries in market research
Like all good things, mobile diaries also present some challenges, like:
It can become an annoyance for the respondents with too many notifications or alerts.
Data privacy issues
Long surveys
Not enough incentives for users
Market researchers can overcome these challenges by setting up surveys to make things easy for the respondents. They should also take the steps needed to protect user privacy. It is also essential to recruit the appropriate group for any study and incentivise them to complete the surveys.
In a world of smartphones and connectivity, mobile diaries are a great alternative to traditional methods.
Smartphones are commonly used, and most people always have their phones on hand. Therefore, mobile diaries are a great way to gain valuable and qualitative insights from consumers as they are always within reach. They provide in-the-moment information regarding behaviours, attitudes, perceptions, and changes over an extended time.
Market researchers can provide rich insights that facilitate better decision-making with real-time qualitative feedback. A mobile diary is easy for respondents to share more authentic and reliable information through images, videos, audio clips, and texts.
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With a GDP of $5.15 trillion, Japan is well-positioned for international expansion and offers substantial business opportunities for brands in various industries.
The country has dramatically bounced back from the disruption caused by the 2011 natural disasters, like the earthquake and the Tsunami.
Japanese motor vehicles and electronics are prevalent globally. It is also among the world’s largest producers of steel.
The country is among the world’s largest exporters of motor vehicles and electronic equipment. The service sector makes up the highest percentage of the economy in terms of gross domestic product and employment.
Major Industries in Japan
Japan’s five largest companies by market capitalization are Toyota, Sony, Keyence, Recruit Holdings, and SoftBank Group. Sony’s portfolio includes a distinctly non-Japanese Hollywood movie and music business originally acquired through a merger and acquisition over 30 years ago. SoftBank, in recent years, has morphed into a massive tech fund run by foreign fund managers invested almost entirely in non-Japanese startups. Recruit’s new CEO spent ten years acquiring and growing recruitment businesses in the U.S. before his promotion earlier in 2022.
Japan is focused on manufacturing precision and technology products such as hybrid vehicles, robotics, and optical instruments.
Other industries prominent in Japan are agriculture, fishing, and tourism.
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What makes Japan an excellent choice for international expansion
Large World economy
The third-largest economy in the world, after the United States and China, and the fourth largest importer of U.S. products, Japan is open for international business. It is also one of the world’s most literate and technically advanced nations.
Robust Consumer Economy
Japan has a robust consumer economy with a per capita income of $42,197 and is a haven for brands that want to expand internationally. Japan’s massive consumer economy, in which consumers with considerable purchasing power seek high-quality and innovative goods and services.
Protections and Compliance
An essential member of the international trade system, Japan complies with the law, and its efforts to maintain the rule of law is one of the pillars of its foreign policy. It also provides intellectual property protection and rights.
Easy and inexpensive to set up an office
According to the World Bank’s “Ease of Doing Business” report, it takes about 11 days to incorporate. It costs 0.7 percent or JPY 60,000, (approximately USD 470 million), whichever is higher, and registration and seal fees. For companies that want to set up a branch office, the costs are low and procedures simple. Co-working spaces are also an option in bigger cities.
Rapidly Aging Population
Japan is ageing fast. One in three people is estimated to be 65 years and older by 2036, conferring the title of the world’s leading “super-aged society.”
While the nation’s rapidly ageing and declining population pose risks of an economic crisis, it also presents massive opportunities. As a result of the declining population, individual income has risen, surpassing U.S. citizens.
Fewer people in Japan mean larger living spaces, more arable land capital, more disposable income, and higher quality of living. This fuels the growth in several industries, such as pharmaceuticals, healthcare, franchising, and real estate, to name a few.
Seniors in Japan are financially secure and healthy overall and big consumers of various products and services.
Innovation and Research
Japan reigns supreme in research as a nation with a large senior population. It has a goldmine of data on ageing, medical data, and medical assessments—these datasets are beneficial for local governments worldwide. The nation ushers innovation and technological advancement in many sectors.
Just as countries can look up to Japan to help their ageing population and fill technological gaps, foreign brands can view this as a great time to expand and invest in such fields.
Significant obstacles to consider before entering the Japanese market
Entering the Japanese market is lucrative and full of opportunities, but it is not without many obstacles and challenges. It is noteworthy here that Japan is one of the few Asian countries that never had a western country rule over them, and this is because of Japanese are strong-willed and are rooted in tradition.
Although tariffs are generally low, Japan has other barriers to entering the market that may hinder foreign products’ importation into the country.
It is essential to factor in some of the most significant obstacles before entering the Japanese market. These hurdles can be measured against the brand and company goals to make the right decision and market entry plan.
Japan’s size makes it essential for brands to invest substantially, increasing risks.
Japan is a highly competitive market, and domestic brands have a strong presence. Therefore, it is not easy to compete with local Japanese companies. However, thorough market research before creating the market entry plan can help brands overcome the challenge of competing with local companies.
Japanese are discerning and look for value for money and high quality when making purchase decisions. Additionally, the Japanese culture and tastes are very different from the Western world. Therefore, brands have to redesign and redevelop their products and services to tailor them to local tastes and preferences in most cases. Market research and product testing methodologies can help brands create and tweak products to fit the Japanese lifestyle and culture.
Japan has very little foreign investment for an advanced nation, keeping the Japanese business sector isolated. As a result, only about 3-5 percent of Japanese speak good English, which can be a barrier for some countries.
Japan has a strong network of regulations, permissions, and extensive procedures as a bureaucratic country. These strict regulations keep new entrants from competing with established industries. However, these regulations are being slowly relaxed.
Management and H.R. policies are very different in Japan, and organizations entering the country must consider and adapt to the management style in Japan, because failing to do so, is a recipe for disaster.
Marketing to the Japanese consumer
Japan is a unique market, and it is crucial to understand the cultural nuances and the Japanese consumer. You cannot become a Japanese marketing expert overnight, and it is helpful to hire local advertising agencies when marketing in Japan.
For the same reason as above, it is critical to regionalise everything. Labels on products and marketing and sales materials, digital campaigns, and the website need to be in the Japanese language.
The Pepsiman commercial is an excellent example of regionalizing a brand. When Pepsi’s Japan branch decided to create something regional for Japan, they contacted Travis Charest to create a superhero mascot to promote Pepsi. This faceless superhero managed to get a cult following in the country. They developed an action game for the Playstation and created several successful commercials using Pepsiman.
Nike’s attempt to extend its marketing message to include social activism in Japan was met with criticism. Nike Japan released a video depicting the struggles of women athletes in Japan that faced bullying and racism, topics that are not openly discussed in the country.
Martin Roll, a business and brand adviser, says that Japanese consumers are not as vocal and will not express dissent unless they feel brands cross a red line. Therefore, it is important to have a deep understanding of the culture, the sentiment of the people, the root of homogeneity in Japan (post-Hiroshima Nagasaki, there was a focus on a homogeneous society), and how to carefully tread the delicate line.
https://www.youtube.com/watch?v=XkFaQuhHOtw
As in any other new country, it is also essential to have a local marketing plan and calendar.
Distribution and Sales Channels in Japan
The choice of distribution channels depends upon the product. Due to space limitations, small retail stores often stock limited inventory, and wholesalers deliver smaller amounts more frequently.
Culturally, the Japanese prefer face-to-face interactions and place a high value on building and maintaining business relationships. This distribution system is costly and increases the price of goods. The growth of big box stores and e-commerce is challenging this status quo.
In 2021, approximately 2.25 million vending machines in Japan were beverage vending machines, selling drinks like cooled beverages or coffee.
The primary distribution and logistics points are found in the major port cities, like Tokyo, Yokohama, Kobe, Osaka, and Fukuoka.
Market entry strategy for Japan
Brands need to develop and maintain strong relationships with local partners to gain a foothold and succeed in the Japanese market. The local partner can act as an agent, representative, or distributor and manage a branch office or subsidiary in Japan.
Since the business culture is unique in Japan, visiting the country several times before entering the market is good. This can help familiarise the organization with the culture and business climate.
Japan has a stable economy and is a dream destination for foreign investment. The key to successful business entry in Japan is doing the leg work using market research to understand the culture, localise the product and messaging, and find the right partner to expand the given brand in this unique marketplace full of opportunities.
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Emerging technological advancements are transforming market research forever. As many consumers move online, the way brands identify and understand consumer needs is being reimagined.
Many technology trends disrupt the market research industry —from data collection and new product launches to tracking brand performance. This blog post will focus on the breakthroughs in technology impacting brand tracking and product performance tracking.
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Brand and performance tracking refers to the process of continually measuring brand health over a period within the target audience. It allows brands to measure the performance of a product in relation to its competition. After a new product is launched, market research helps brands gauge performance to stay competitive.
With consumers increasingly moving online, brands can tap into new, vast, and reliable consumer behaviour data in real-time. This has also made Direct to Consumer marketing much more common. Brands like Happy Human (Singapore), Dime Beauty (U.S.A.), Joi (Malaysia), Sleepy Owl (India), Recess (Philipines), Adopt a Cow (China), and Knot (Japan) have eliminated the middleman to create, develop, sell, and distribute their products directly to the end-user. The absence of middlemen and brick-and-mortar stores allows them to maintain quality and reduce prices. But this is not all. These brands also have the added advantage of measuring performance directly without employing market research across several retail outlets. They can discover brand sentiment directly, making them more agile, nimble, and competitive.
While there is still a place for traditional research methodologies, technologies like machine learning, Artificial Intelligence, Virtual Reality, and chatbots continue to reinvent the market research industry.
Let’s look at the primary technologies in brand tracking and competition analysis that are changing the face of market research.
In the fiercely competitive E-commerce world, the key to outperforming the competition is tracking and monitoring the price competing brands charge for similar products and services. Brands need to keep a keen eye on their competitor’s pricing strategy and price changes over several products to stay competitive, and that’s not an easy task even for larger companies.
This is where e-commerce price monitoring technology comes into play.
Ecommerce price monitoring software allows brands to track their competitor’s price changes and dynamically adjust their pricing.
By employing this type of software, brands can stay abreast with competitor pricing and adjust pricing based on demand, competition, and inventory levels.
Many such tools are available in the market, including Minderest, Price2Spy, and Prisync, with sophisticated matching technology and high levels of accuracy.
Market research utilises machine learning and A.I. for brand and performance tracking to revamp advertising and messaging.
While some grey areas are associated with A.I. in other fields, the market research industry has embraced this technology.
One of the things brands need to track constantly is how their messaging is resonating with the target audience and how the market perceives their brand. This is because a brand is not just the logo and tagline. It is a sum of all parts and is an overall feeling that tells a narrative and evokes sentiment and emotion in the audience.
Technology helps brands better understand brand performance and perception to inform better decision-making. It allows brands to measure and bridge the gaps between their intent and how the audiences interpret and perceive their message.
The use of A.I. in brand tracking has allowed market researchers to analyze qualitative surveys at a fraction of the time taken by manual data collection methods. Furthermore, this enables them to ask more open-ended and follow-up questions, find the right panellists faster, eliminate bias, write reports quickly, and significantly improve the quality of their surveys and reports.
In today’s dynamic digital marketplaces, A.I. is powering brand tracking to gauge the changing consumer perceptions.
Sentiment analysis is a sub-category of A.I. and N.L.P., which automatically uncovers feelings, emotions, and sentiments behind plain blocks of text. It is extensively used in brand tracking because it is efficient, reliable, and accurate.
Over 45 percent of the world is on social media. There are about 500 million tweets per day, and about 1.96 billion people worldwide use Facebook every day. Consumers constantly call out brands on these social media platforms and review sites. It would be overwhelming and near impossible to collect data manually. Brands can effectively gauge overall brand sentiment across platforms and channels online using automated tools.
For instance, when the popular ride-sharing service, UBER, launched a new version of its app, it used social media monitoring and text analytics to measure user sentiment about the new version of the app. Eye-tracking technology works similarly and can track users’ engagement scores and emotions on a website.
There are several brand tracking tools available for brands. Candymaker Mars used one such tool that combines the standard digital video metrics, like view-through rates and skip rates, with facial expression tracking of the viewers while watching the ad using an A.I. algorithm.
While the tool measures digital behaviours, it puts enormous weight on gauging emotion and sentiment. This technology is essential to track brand performance in a world plagued with minuscule attention spans. It allows brands to obtain a complete picture of consumer perception.
Many technologies use participants’ webcams to track their facial and emotional responses while viewing ads, providing invaluable data used to inform sales forecasts.
Chatbots are aggregating vast amounts of consumer data.
The usage of chatbots as a communication channel between brands and consumers has increased by 92 percent since 2019.
As many consumers shop online, they engage with chatbots, making them the fastest-growing brand communication channel.
A survey found that up to 80 percent of users answered questions, three times higher than responses from email surveys.
Brands like IKEA are using chatbots to gather valuable consumer feedback. Companies use Whatsapp and Facebook messenger to measure consumer sentiment and feedback efficiently.
The use of brand tracking cannot be overemphasised. It allows brands to understand how their current audience perceives the brand. It can also lead brands to uncover until now undiscovered target audiences.
With brand tracking software, brands can see the true impact of their campaigns. Brand tracking holds the key to insights any brand needs to thrive. Using the right tools and technology, brands can obtain actionable information about the brand perception among the target audience and how it scores against the competition.
A brand is one of the most valuable assets of an organization. It is, therefore, critical to continually measure satisfaction, awareness, and perception. Incorporating brand tracking into their marketing strategy can help brands understand their target audiences and consumer needs and make more profitable marketing decisions. Technology has made it easier to uncover massive data sets to monitor a brand effectively and accurately. By combining this technology with digital metrics, brands can increase their competitive advantage.
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As organisations chart their growth and enter new markets, market research can assist them with these goals through data-driven insights. Market research plays a pivotal role in identifying market trends, uncovering competitive advantages, and discovering consumer intent and behaviours. This helps brands make better decisions based on data.
Therefore, market researchers are increasingly turning to technology to improve data collection methods, research processes, and consumer insights presentations. Technology allows researchers to reduce costs, boost productivity and increase efficiencies in all primary functions.
Machine learning and artificial intelligence are at the forefront of technological breakthroughs transforming the market research industry. These and other technologies allow more efficient and meaningful data collection and analysis.
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Let’s take a closer look at the most important technological trends in market research.
Artificial Intelligence (A.I.)
Artificial intelligence (A.I.) is the ability of a computer or a computer-controlled robot to perform tasks usually done by humans and associated with intelligent beings. In market research, A.I. provides large amounts of unstructured data at scale.
A.I. is often used in conjunction with traditional methods with excellent outcomes in influencing marketing strategies, delivering service solutions, and uncovering consumer behaviour. It assists people in market research by automating tasks and increasing efficiencies, obtaining deep insights from a large amount of data, and enabling them to use natural language processing (N.L.P.) for better understanding.
Most people understand that traditional market research is about online surveys. A.I. allows surveys to be conducted via voice. For instance, brands are using voice survey tools to collect data that sounds more human. This is an incredible new development that allows users to provide feedback hands-free. For researchers, this is a qualitative approach that speaks volumes regarding the emotions behind the words. It captures the true sentiment of the participants.
2. Eye-tracking
Eye-tracking is a research methodology for measuring where a person looks, providing insight into their thinking.
It is now possible to record everything about how the eye interacts with everything in front of it. Using infrared light and high-resolution cameras, market researchers can track how eyes move in response to stimuli. They can, therefore, unlock real-time emotions and consumer reactions, obtaining insightful and quantifiable data behind consumer reactions and behaviour.
3. Real-time feedback
Real-time feedback is a type of qualitative market research methodology in which you receive live feedback from users or visitors on your website or app.
Mobile diaries allow brands to obtain “in-the-moment” real-time responses. They don’t have to recall their experiences from a few days or weeks ago; they can provide real-time feedback, for instance, while interacting with your app or product.
Most people always have their phones with them, not necessarily a traditional journal or diary.
4. Microdata
We hear and read about “big data,” but microdata is becoming increasingly crucial. Microdata is data about individual consumer activity.
Microdata is data on the characteristics of units of a population, like individuals, establishments, or households, collected by a census or survey.
A good understanding of individual consumer behaviour supports more targeted business decisions. So while big data is essential, certain decisions cannot be made using macro data methodologies.
5. Augmented Reality (A.R.)
According to Investopedia, “Augmented Reality (A.R.) is an enhanced version of the real physical world that is achieved through digital visual elements, sound, or other sensory stimuli delivered via technology.”
We partnered with Asahi on a pilot designed to explore the applications of augmented reality in package testing. The pilot was focused on one of Asahi’s flagship brands: Fuller’s London Pride. London Pride is already the capital’s number one ale. Still, as part of a strategic drive to bring the brand to more ale lovers nationally, Asahi wanted to test a new concept for the packaging against the existing bottle design.
Read the complete case study on how we ran an industry-leading pilot test on A.R. in market research to discover its applications to pack testing.
Virtual environments have provided brands and market researchers with a more accessible and less expensive way of product concept testing, feasibility analysis, and interpreting consumer behaviour regarding a new and developing product.
Brands use A.R. to help consumers view a product, like a piece of furniture in their surroundings. It provides the brand with feedback on how a product can work for customers. It is also far less expensive than a focus group or shipping the product to the consumer.
6. Internet of Things (IoT) and Wearables
Internet of Things (IoT) refers to a network of connected objects or devices that can collect and exchange data in real-time using embedded sensors. Cars, thermostats, lights, and window blinds, can all be connected to collect and exchange information over a network using sensors.
Internet of Things (IoT) devices are a goldmine of data with many facets of consumers’ everyday lives. Let’s say a company wanted to measure the activity levels of consumers in the new year. They will get rich data from a wearable device like a Fitbit or Apple watch (with the user’s permission).
7. Social targeting
Social media targeting is the ability to post or advertise certain content to specific audiences. These can be chosen by the person posting or the advertiser to include niche audiences based on demographics, interests, etc.
There are over 4.55 billion social media users worldwide, and that’s where most people congregate nowadays. Advertisers have leveraged the precise targeting of niche audiences to drive leads and sales.
Brands can target a specific section of the population based on age, gender, interests, behaviours, languages, and even the brands and products they currently use.
Market researchers can use social sampling to effectively target participants according to what they are looking for based on personal interests, location, and interests.
Surveying consumers virtually allows them to target specific niches of participants. Researchers can select participants who care about the product or service with precise targeting, resulting in higher response rates.
There are plenty of opportunities to adopt new technologies in market research so brands can get better insights faster. This enables brands to make better decisions based on rich data.
Technology makes it possible for market researchers to collect data quicker and more accurately and analyse it more effectively. However, they also need to sharpen their skills when using technology. In some cases, it is essential to complement traditional methods with technology. In either case, technology adoption will allow market researchers to spend less time on data collection and analysis and more time on the big picture problem-solving. This will bring more value to the brands and markets they serve.
Technology to enhance, not replace, the human component
While technology provides real-time, rich, and robust data and an efficient way to sift through vast amounts of data, it does not replace experience in interpretation. Technology should complement, accelerate, and enhance the market research methodologies, not replace them.
For instance, automation should be used to reduce the time between putting the survey in the field and retrieving the feedback and responses. But the automation should not replace the interpretation made by an experienced market researcher.
Market researchers know how to design surveys, ask the right questions, and interpret data. With the advances in technology, they can move from data collection to more big-picture thinking. In a world of automation and data, human beings remain unique in their ability to create and understand people.
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Consumer interest in Connected Technology is rising due to the accelerated digital shift to “at-home” trends during the pandemic. With an increasing number of people working, learning, shopping, exercising, and even monitoring their health from the comfort of their homes, the connected technology market is rife with opportunities for brands in a multitude of sectors.
From AI-enabled voice assistants that can be summoned on command to watches that have gone beyond telling time and have converted our wrists into smartphone holders and health monitoring devices, connected technologies are transforming the way we live, work, and play.
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Market research and product testing are paramount for the successful launch of connected technology products.
With an increasing number of consumers and households jumping on the connected technology bandwagon, we are collecting more information and data than ever before, which has positive and negative implications for the market research industry.
Market research companies provide product testing services in various industries as they conduct research studies for a range of products before they are launched and help guide new product development. These companies put the products in the hands of the consumers who will be using the technology.
Product testing is a research methodology that allows brands to gather quantitative and qualitative information about a user’s potential behaviour, reactions, and preferences, like the taste, feel, and smell. For connected technology, often, a prototype is tested in the market before it goes into development.
What is connected technology?
Connected technology is products with built-in or embedded technology comprising sensors and processors to connect with their environment and other products.
Connected technology is tied with the Internet of Things (IoT). Watches are no longer used only to tell time; their function has extended to enable text messaging, phone calls, and fitness monitoring. Our homes are getting smarter; our cars go the extra mile to deliver convenience; our offices thrive remotely using real-life collaboration and project management tools.
Let’s look at some of the main areas where connected technology is unfurling, what the future has in store for consumers, and how brands can match this rapid growth.
How are people currently using connected technology?
Connected technology has seamlessly integrated into our daily lives and shows no signs of slowing down, and for good reason. The demand for connected technology that provides convenience, comfort, accessibility, and automation is at a historic high.
To understand the benefits and use of connected tech, let’s look at the main areas we use connected technology in our daily lives.
There’s no place like a smart home.
Smart homes are redefining our living spaces and becoming more innovative. According to Statista, the global smart home market is worth more than US$126 billion.
Consumers increasingly demand home automation when they purchase a home —and for a good reason. Home automation provides convenience, functionality, security, entertainment, and energy savings. The possibilities are endless.
For instance, lighting control network systems allow you to control the whole home or building remotely by your smartphone. Sensors turn lights on and off as we enter and exit rooms. Automated window treatments allow you to control a room’s ambient lighting and other aspects remotely. Smart homes also allow for remote access.
Smart appliances are making life easier for households. Smart Appliances as a segment includes all kinds of connected household appliances. Surveillance cameras and home security systems are getting more advanced. Baby and pet monitors allow people to monitor their babies and pets.
Consumers in Asia adopt devices more quickly than in North America and Europe, and South Korea leads the way with a 27 percent household penetration rate in 2022.
Smart homes are not just nice to have anymore. Homeowners are increasingly expecting smart home features, and builders and technology companies are taking note.
Smart homes are getting smarter and now go beyond just thermostats and light dimmers. Technology is becoming much more affordable and accessible, and some smart homes will make your jaw drop.
Consumers are much savvier and increasingly demand technology built into their homes. Even the lower to mid-range new home buyers expect certain smart home features to be part of the build. Therefore, every construction company needs to include these home features or risk falling behind their competitors.
How does the demand for Smart Homes impact brands in the market?
This new trend has many implications for the market. Builders will need to consider privacy and cybersecurity, adjust agreements, make sure devices can “talk” to each other, and have the ability to offer flexibility as new technologies are added in the future.
With the average household using 25 connected devices, there is considerable pressure to provide a connectivity network far beyond what a regular service provider can deliver.
The pandemic has also created a new generation of germophobes, and KB Homes, a home builder in the U.S., has launched MERV-13-rated air filters in their communities. Compared to lower-rated air filters, these high-grade residential air filters eliminate dust, pollen, mould, and certain bacteria and viruses for improved air quality.
Home appliance brands are not only thinking of innovations but also a way to upgrade features into existing smart products. The CES 2022 show in Las Vegas saw AI-powered laundry machines, hands-free faucets, healthier microwaves, next-level smart blinds, and smart bathing technology.
Connected technology is driving the automobile industry.
Connected technology is designed to connect to a smartphone to do more than play music or route phone calls through the car’s speaker. For instance, you can turn a connected vehicle on or off using a smartphone. It can allow the owner to use an app to control the car or share diagnostic data to remind you when an oil change is due, and so on.
Connected vehicles on the road connect to a network so all types and sizes of cars can “talk” to each other as they share vital information on safety, road conditions, traffic, and mobility.
These are just a few instances that barely scratch the surface of what connected vehicles can do.
A Statista report estimates the size of the global connected car fleet to increase more than threefold in the coming years. In 2021, there were about 84 million connected cars in the United States, and it is projected to exceed 305 million in 2035, making the United States the biggest market for connected vehicles.
Europe currently accounts for around 30 percent of the global connected car fleet. The E.U. is one of the regions with significant potential for connected services.
As of 2019, about half of the motorists in Europe said they were willing to switch car brands to access new connectivity features and services.
According to 1Mordor’s 2020 report: “The connected medical device market is expected to register a CAGR of 18.92% over the forecast period from 2022 to 2027.” The same report showed the Asia Pacific as the fastest growing market and North America as the largest market.
Connected tech in healthcare is also referred to as Connected Care. It may be defined as the real-time, electronic communication between a patient and a medical provider, using digital tools such as remote patient monitors, telehealth, wearable technology, secure messaging, and mobile apps, to name a few.
It is estimated that remote monitoring for healthcare could be worth USD 1.1 trillion by 2025.
Wearable technologies hold a significant share of this market, providing real-time data so health care providers can help patients remotely. They provide convenience and cost-effectiveness by reducing multiple visits to the doctor’s office. With cardiac-related devices expected to be worth USD 800 billion by 2030, there is a massive opportunity for healthcare brands in the cardiac segment for wearables.
These medical devices can be vulnerable to security breaches, impacting their safety and effectiveness because they are computer systems.
While there are data security risks involved, wearables can detect cardiac arrhythmia conditions causing stroke and allow neurologists to diagnose seizures remotely; the benefits of these products far outweigh any risks.
Connected tech encompasses your fur babies.
The pet humanization trend and growing concern amongst pet owners about the health and safety of their pets continues to drive the pet industry’s growth at a CAGR of 6.1 percent. You can now dress your pet in a Banana Republic sweater, insure them with MetLife, and get CBD supplements to calm them down.
This trend is now dovetailing into the pet wearable devices market. According to a recent global market research study, the global market for pet wearables is expected to reach USD 2,5 billion by 2024. Pets can wear these devices to help identify, track, control, and even for medical diagnosis and treatment. Furbo is one such pet wearable in the market that aids anxiety in dogs. A remote pet camera that alerts you when your dog is barking can take dog selfies, and owners can toss treats, all from their smartphones.
Connected technology is reshaping the fitness industry.
One of the first industries impacted adversely by the pandemic was gyms and fitness centres when they were forced to close their doors due to fears of spreading COVID-19. Stuck at home and with more time on hand than ever before, consumers made a beeline for at-home gym equipment. Peloton was at the forefront of this revolution and later bought Lululemon’s Mirror.
Peloton’s stock has reached highs and has plummeted in what seems like a roller coaster ride. When gyms closed during the pandemic, Peloton’s stock price and product sales were at an all-time high, increasing more than eightfold from March to December 2020.
An Atlantic article revealed the company had 2.3 million users paying about $40 a month to take classes on its “connected fitness” products by August 2021.
Google trends show a similar picture.
At-home Fitness Trends during the Pandemic
The global home-fitness equipment market will grow to $15.13 billion in 2022 at a compound annual growth rate (CAGR) of 9.6%. The at-home fitness market is expected to reach $21.84 billion by 2026.
What does this mean for fitness brands —both in-person gyms and online fitness platforms?
Brands providing fitness solutions inside and outside the home will need to commit to the new normal and an approach that fits consumers’ lifestyles.
Brands that want to become a part of their consumer’s fitness regimen will have to consider a hybrid approach. On-site fitness studios and solutions should utilize a more hybrid approach to keep consumers physically and digitally engaged and connected. They can do this by complimenting their in-person services with a mobile application. At the same time, brands with at-home gym equipment and tools should make data security a priority.
The intersection of retail and technology elevates the shopping experience —both in-store and online.
Not all businesses survived the pandemic and the recent, rapid shifts in consumer habits, but the ones that did are thriving. These retailers have been able to master the in-store shopping experience.
Retail technology provides an exciting opportunity to both consumers and retail brands. Connected technology is taking the shopping experience up several notches. While people still shop in these stores, a brand’s physical location is considered one of the many channels. Consumers interact with these stores digitally and will come to expect this from every brand.
From using virtual mirrors to try on clothes to pointing a piece of furniture on your cell phone and placing it in your home, Augmented Reality (A.R.) is changing how we shop and try products. Car shoppers can go into dealerships and customize cars with different colours or styles using their tablets or phones. They can use A.R. to try sunglasses from the comfort of their home.
Grocery stores may look the same as many years ago, but the experience has completely transformed. The distinction between online and offline has little relevance today in the grocery space. This is because today’s consumers do not want their shopping experience to be held back by the limitations of a single touchpoint. Today’s connected consumers expect an omnichannel shopping experience, including online ordering, curbside pickup, delivery, self-checkout, scan-and-go, and contactless payment options.
Supermarket brands need to have an omnichannel approach to meet customer expectations, including convenience, speed, and efficiency. For instance, while a customer is exploring store aisles physically, they should have the option to interact with the store digitally and even complete the transaction using the store’s mobile app.
Consumers’ data is recorded and stored to provide a personalized experience with product recommendations and deals. When consumers create an online account, their purchasing habits are used to tailor relevant deals, ads, and offers. In the absence of an online account, consumer data is tied to a loyalty card.
Technology also allows retailers to alert customers when stocks of the items they regularly purchase are low or when an item is back in stock. Alexa, Amazon’s voice assistant, will notify you based on your ordering history if you are running low on a particular product, tell you how much it is, and ask you if you would like it added to your cart.
Grocery delivery services became popular during the pandemic. Now that we can go back to a physical store, many consumers have become accustomed to using delivery apps like Instacart for their convenience, speed, and seamless service. You can also watch your groceries transported to your doorstep with the app’s live map view.
Sustainability is also coming into the picture with an increasing number of younger generations that prefer buying from eco-friendly companies. Zero, a Los Angeles-based startup, is an example of an eco-friendly brand that delivers groceries in sustainable packaging.
The future of retail is hybrid with an Omni-channel approach and connected experiences across touch-points.
As customers jump across several channels when they shop, retailers need to engage with where their customers are via digital channels.
Leveraging shopping behaviours, personalisation, user experience (UX), and integration will be critical for retail success. This will help retailers engage with their customers at various touchpoints —physical stores, sites, apps, and significantly improve the shopping experience.
Retailers also need to factor in social media networks, messaging apps, voice assistants, mobile devices, and other new channels to capture their customers’ attention and engage with them. Consumers expect incredibly personalized and relevant content.
Challenges in the connected technology space and how brands can use these as opportunities to grow
During the pandemic, the older, less tech-savvy generations also adapted to connected technology and enjoyed the benefits of staying connected with friends and family. Brands should no longer ignore this segment’s needs and may need to provide more in-depth onboarding help and tech support.
Now that people are back to in-person, they will continue using these devices and technologies in and out of the home, in the new normal. There will be a need for interconnectivity across the house, car, and mobile devices will be critical moving forward.
The industry faces many challenges, including data security, privacy concerns, continuous innovation and iteration, a massive load on the network and wifi issues, theft, loss, and damage.
Here are ways in which brands can overcome such challenges:
Provide extended warranty
Put customers first
Provide multiple customer-service options
Insurance against theft, loss, and damage
Provide on-demand tech support
Help with digital identity protection
Allow trade-in offers to swap your old device for a new one at a discount
Continuously upgrade technology
What does the future hold for connected technology?
In a digital-first world, physical fitness studios and stores are still appealing. Physical stores that embraced this reality are thriving. They have gone above and beyond to offer a hybrid approach and have elevated the in-store experience. There is also a preference for in-store shopping in older generations versus younger ones.
The pandemic played a massive role in speeding up the adoption of digital-first behaviors. Now that we know consumers expect a hybrid world where digital meets offline, brands can play a role in pushing innovation and further improving customer experiences across touchpoints and channels. With a goldmine of integrated customer data, they can offer a personalized and relevant experience in a hyper-connected consumer world.
How market research can aid brands in the connected technology space
For brands aiming to disrupt the market with the next “new” thing in connected technology, it is vital to know how consumers will respond to it before going to market. Market research can provide the valuable data, and insights brands need to take action.
Brands have several critical decisions regarding target markets and audiences, price, distribution channels, promotion, and product features. How can brands bring new product lines to market without proper knowledge? The good news is market research provides unique methodologies tailor-made to capture purposeful information to inform those decisions.
Market research allows brands to collect relevant information about market needs and customer preferences, impacting every aspect of the business, product, and brand. Backed by this information, brands understand the choices and behaviors of their potential customers. Therefore, their products can meet their customers’ needs and reduce the risk of an experience gap between the company and its products or services. The experience gap is essentially the gap between what the customers expect/ want and what the companies give them.
Market research is used for product testing and development. Effective market research uses a diverse population to test a given product and ensures it works for everyone in the target market. Brands also use market research for brand name testing, concept testing, messaging and campaign testing, branding, and logo testing, and pricing testing, to name a few.
For brands in the connected technology space that are often under high pressure to quickly produce and iterate high-quality products with an enhanced customer experience in a competitive market, the importance of market research cannot be overstated.
Brands in connected technology need to utilize a comprehensive testing strategy beyond traditional product and messaging testing. Market research can study the preferences and User Experience (UX) throughout all touchpoints within the customer journey.
For instance, connected technology brands can use market research to ensure customers are surveyed on current technologies and UX and online shopping cart abandonment. Likewise, the data from connected tech can (with permission) provide a goldmine of information about specific market segments, which can inform better decisions based on hard facts rather than gut feelings or assumptions.
For smart product companies, it is also essential to make sure all their products connect seamlessly to make their customers’ lives easier and more comfortable. Therefore, market research is utilized to make sure the product works and connects with other smart products to enhance the customer’s life.
Connected technology became popular before the pandemic. The pandemic only accelerated its adoption. The rise of connected consumers across the globe has led to connected technology trends across industries. As brands navigate the challenges of wifi capabilities and data privacy, they are continually innovating and iterating smart, connected products that are relevant and user-friendly.
We don’t need a crystal ball to make this prediction: the future belongs to a connected world.
Learn more about how Kadence International’s Marketing Research is driving growth for leading technology companies here.
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Launching a new fast-moving-consumer-goods (FMCG) product is a process wrought with challenges and notoriously difficult to pull off successfully. In fact, it’s such a treacherous domain that approximately 80-85% of all FMCG launches fail! So how do you successfully launch a new FMCG product in the market?
Companies need to do all they can to maximize their chances of success when it comes to launching their product. This means getting all the different stages of the process right, investing the right amount of time and resources into planning, and making use of all the tools and knowledge at their disposal.
In this article, we’ll show you how to launch a new FMCG product in the market successfully. To do this right, you need to start at the very beginning by considering what makes any FMCG product successful.
What makes an FMCG product successful?
There are a number of factors that successful FMCG products have in common. Let’s take a look at 3 things that separate good products from failures.
They’re distinct
Successful FMCG products have to offer something that sets them apart from all the other similar products on the shelves. However, this can be a tricky balancing act — you don’t want your product to be so different that it moves away from what the customer wants.
If, for example, you’re selling a brand of instant coffee, you know your customers want some variety of coffee that they can pour into a mug and get a fresh beverage in seconds. But at the same time, you want your product to stand out and offer something more than all the other instant coffee brands.
Brands that can strike this balance right and create a distinctive FMCG product that continues to delight the customer will be on the road to success.
They’re what people want right now
The FMCG space is defined by being in a constant state of change and flux. Innovation is happening all the time, and people’s tastes are constantly changing.
Successful FMCG products are able to tap into trends and popular demand, giving customers what they want right now as opposed to what they wanted five years ago. For example, as people become more health-conscious their taste in snacks has changed. The companies who picked up on this change in demands and adapted their product offering to include healthy, low-calorie, high-protein snacks were the ones most able to adapt and succeed in a changing market.
They persist
In a market where goods go in and out of fashion quickly, brands that can stand the test of time are at a huge advantage. Household names like Coca-Cola, L’Oréal, and Nestle are household names because they’re masters at staying relevant and in-demand in markets that are prone to constant change.
Doing this successfully requires an intimate knowledge of your market and customers and a knack for constantly delivering even as tastes and trends evolve.
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Why do FMCG product launches fail so often?
There are lots of reasons why launching an FMCG product is so hard and why so many fail. Here are some of the main reasons FMCG launches tend to come up short.
It’s a competitive space
There’s no getting around it — there are lots of FMCG products out there. When you enter this market, you’ll be competing with many other brands, brands that have often been in the game for many years.
If you don’t get it right from the very beginning, you’ll never be able to effectively compete and your target customers will go straight to the brands they have been using for as long as they can remember.
Failure to use data and market research properly
Today’s businesses are blessed with more data than ever before in history. Much, much more. And this can be augmented by wider market research to understand the market, the key trends at play and reactions to your concept or product. If used correctly, this data and insight allows you to better understand your customers, and launch a product that takes the market by storm.
Unfortunately, many FMCG brands fail to tap into that rich reservoir of data, missing out on the advantages it offers and instead launching a product that isn’t closely aligned with what customers want.
Development costs and lack of funding
Another characteristic of FMCG launches is that they’re expensive. Developing a successful FMCG product can cost a huge amount of money, and this typically requires a lot of reliable funding and investment.
If you fail to secure enough funding for your project, you’re setting up the entire launch for failure.
Failure to understand timescales and stick to them
Launching an FMCG product involves a huge number of moving parts and deadlines. If you aren’t careful, it’s easy to mess this up and end up falling behind the dates you promised.
One clear example is shipping times. If your product fails to reach your customer within the time they expect, you’re creating a recipe for canceled orders, damaged reputation, lost money, and a failed launch.
Failure to understand the importance of constant innovation
The FMCG space is defined by constant, ongoing innovation. Companies are investing vast sums of money into making sure their next product is enough to stand out from the fierce competition and keep customers delighted. To survive and succeed as an FMCG brand, you need to be constantly learning, adapting, and innovating. It never ends, and it’s the only way to avoid failure.
How to launch a new FMCG product in the market successfully
Understand the market and your customers at the outset through market research
Understanding your customers and the market is absolutely critical when thinking about how to launch a new FMCG product in the market. You need to know as much as possible about your customers’ pain points, desires, their demographics, what they’re already buying, and more.
Understanding the broader market you’re operating in is important too. This can help you identify trends to capitalize on and size the opportunity for your FMCG launch.
This research should take place long before the product launch, in the initial stages of planning to help inform the ideation process.
Testing, testing
Research is also important later in the process when it comes to testing your ideas with consumers. Quantitative concept testing can help you whittle down your ideas and select the ones with the best chance of success to take forwards. Qualitative concept testing can help you to further refine those ideas in line with consumer wants and needs. There are also other elements of research to consider further down the line once you reach the prototype stage, such as pack testing, central location testing or test tastes to optimise your product ahead of launch.
You can read more about what research you need to consider at each stage of the new product development process in our guide.
Get your marketing right
Effective marketing is a crucial element of every FMCG product launch. Use insights from the NPD process to guide your messaging – on the pack, at the point of sale and in your marketing and comms – to cut through with consumers and steal share of market.
Always be learning
Testing should be an ongoing process — make sure you continue to test, measure and learn, even after the product launch. Collecting data, and making tweaks in response to the feedback you receive can help inform product relaunches or line extensions to keep you at the forefront of your category.
Launching an FMCG product is no mean feat. It’s famously hard to pull off, and statistically most brands who attempt it fail. But that doesn’t mean it’s impossible, and with the right approach and expertise, you can significantly improve your chances of success.
To find out how Kadence can help you boost your chances of success with an FMCG product launch, get in touch.
Concept and pack testing is an area that’s ripe for innovation – a need made ever more pressing during the Covid-19 pandemic. Watch this 15 minute video to hear how we worked with Asahi UK to pilot the use of augmented reality for this purpose, testing pack designs for Fuller’s London Pride.
We’ll share our key findings, focusing specifically on what we discovered about the value of using AR versus static 2D images. These insights will have value to any researcher looking to broaden their toolkit and harness new technologies in the “new normal”.
This is is the first of Kadence International’s Micro Masterclasses, 15 minute videos designed to provide fresh thinking and a new perspective on research methodologies.
When developing a new product, two approaches often come into play: concept testing and test marketing. While they serve complementary purposes, these strategies operate at different stages of product development and answer distinct business questions.
It’s easy to confuse the two, particularly because both are used to assess product viability and reduce risk. However, they are not interchangeable. Each offers unique insights that help brands refine their product strategies and avoid costly mistakes.
Let’s break down what each method involves, starting with concept testing.
What Is Concept Testing?
Concept testing is an early-stage research method that evaluates a product idea before it enters the market. The goal is to determine whether the concept resonates with your target audience and to identify any issues with the product’s appeal, messaging, or design before development begins.
In a typical concept testing study, customers are shown a product description, visual, or prototype and asked to provide feedback on its perceived value, uniqueness, relevance, and likelihood of purchase. This process often uses surveys or interviews to gather both quantitative and qualitative data.
Key benefits of concept testing include:
Reducing product development risk by flagging potential flaws early.
Validating demand before investing in production.
Uncovering new insights that may influence design or marketing direction.
Securing internal buy-in using real-world data.
Different methodologies are available depending on your needs. Quantitative surveys offer broad, statistically significant results, while qualitative interviews provide rich, detailed feedback. In many cases, the best results come from a mixed-method approach.
With concept testing complete and insights in hand, brands often move to a more advanced phase of product evaluation—test marketing.
Test marketing is a crucial stage in new product development, designed to simulate a full-scale product launch within a limited market. It allows businesses to evaluate how a product, along with its associated marketing plan, performs in real-world conditions—without committing to a national or global rollout.
While concept testing helps refine the idea behind a product, test marketing moves further downstream. It focuses on how the product performs in-market, including how consumers respond to the advertising, pricing, distribution strategy, and overall brand positioning.
In practice, test marketing involves selecting a small but representative market—often referred to as a test market—and launching the product on a trial basis. This controlled launch provides valuable feedback that can shape the final go-to-market strategy and reduce the risk of a costly failure.
Why Test Marketing Matters in New Product Development
For brands introducing new products, the test marketing phase serves as a dress rehearsal for launch day. It allows businesses to:
Uncover flaws in the marketing or distribution plan
Test consumer response to different promotional strategies
Measure actual sales and brand lift before full-scale investment
Determine whether the product is ready for a broader rollout
In 2024, with the cost of customer acquisition rising and consumer expectations shifting quickly, more brands are using test marketing to validate assumptions before scaling. It has become especially important in sectors such as FMCG, consumer tech, food and beverage, and retail, where product launches often carry significant investment.
Advantages of Test Marketing
There are several compelling benefits to incorporating test marketing into your product development process:
1. Real-World Insights
Unlike simulations or surveys, test marketing exposes your product to actual market dynamics. You can measure how customers react to the product, pricing, messaging, and channels in real-life scenarios.
2. More Accurate Sales Forecasting
By observing sales performance in a test region, you can generate more realistic projections for broader market demand. This supports more accurate budgeting, supply chain planning, and resource allocation.
3. Marketing Channel Optimisation
Test marketing helps identify the most effective advertising and promotional channels for your audience. This allows you to fine-tune your marketing mix and avoid wasting budget on ineffective strategies.
4. Distribution Strategy Testing
It gives you the opportunity to trial various retail partners, ecommerce platforms, or logistics models, helping you determine the best way to get your product to customers efficiently.
5. Low-Risk Problem Identification
Any strategic missteps, product issues, or campaign underperformance can be caught early. Adjustments can be made before scaling up, reducing the risk of failure on a national or global level.
6. Early Customer Feedback
You’ll gain direct insight into what customers like or dislike about your product, branding, packaging, and messaging. These insights can influence improvements that increase your product’s chances of long-term success.
7. A Signal to Pivot—or Pull Back
If the product fails to resonate with test audiences despite strong marketing support, it may be a sign to rethink the offer or halt the launch. Test marketing provides a data-backed checkpoint before larger risks are taken.
Disadvantages of Test Marketing
Despite its advantages, test marketing also has limitations that brands must consider before committing.
1. High Costs
Effective test marketing involves real spend—on product development, marketing, staffing, and logistics. For startups or budget-conscious businesses, the upfront investment can be a barrier.
2. Delayed Time to Market
Designing, launching, and analysing a test market can significantly delay your product’s rollout. In fast-moving industries, this lag can be problematic if a competitor moves faster.
3. Competitive Exposure
Launching in a public test market can inadvertently reveal your strategy to competitors. If your concept is innovative, others may copy it before you reach full launch, reducing your first-mover advantage.
4. Risk of Misleading Results
Poorly selected test markets, limited sample sizes, or marketing channels that don’t reach key demographics can all skew results. This may lead to incorrect conclusions about the product’s potential.
5. Internal Complexity
Test marketing requires close coordination across teams—including product development, marketing, supply chain, sales, and customer service. If not managed well, the process can become resource-intensive and disjointed.
Is Test Marketing Right for Every Brand?
Not necessarily. For some brands, especially those operating in highly regulated or niche industries, test marketing may not be feasible or cost-effective. In those cases, virtual testing, simulation modelling, or controlled consumer panels may offer more efficient ways to gather feedback.
That said, for consumer-facing products with mass-market potential, test marketing remains one of the most powerful tools for validating strategy and minimising risk before launch.
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Concept Testing vs Test Marketing: Which Approach Is Right for You?
While both test marketing and concept testing are designed to reduce risk and improve outcomes in new product development, they serve different purposes and are used at distinct stages of the process. Understanding when and how to use each can mean the difference between a successful launch and a costly misstep.
Shared Goals, Different Methods
At their core, both concept testing and test marketing aim to answer a similar question: Will this product succeed in the market? Each method offers a way to evaluate product viability before a full-scale launch. Both are also designed to uncover weaknesses, generate customer feedback, and help product teams make more informed decisions.
However, the similarities stop there. The way each method achieves these goals—and the resources required—differ significantly.
Key Differences Between Concept Testing and Test Marketing
Timing and Stage Concept testing is used early in the product development cycle. It evaluates the viability of an idea, design, or messaging before resources are committed to production. Test marketing, by contrast, takes place later. It simulates a real-world launch to evaluate how the entire marketing strategy performs in practice.
Scope of Evaluation Concept testing focuses narrowly on consumer response to the product idea, often using online surveys, focus groups, or qualitative interviews. Test marketing evaluates far more—from advertising effectiveness to pricing, packaging, distribution channels, and sales conversion rates.
Cost and Complexity Concept testing is faster, simpler, and less expensive to run. It’s ideal when budgets are limited or when businesses need rapid, directional feedback. Test marketing requires a more substantial investment, as it involves manufacturing the product and running a controlled launch in a real market.
Risk Exposure Because concept testing happens behind closed doors, it offers a level of confidentiality. Test marketing, on the other hand, places your product and positioning in the public domain. This increases the risk of competitors observing, replicating, or pre-empting your go-to-market strategy.
Data Type Concept testing yields qualitative or quantitative feedback based on perception, interest, or likelihood to buy. Test marketing delivers behavioural data, measuring actual purchase patterns, marketing response, and operational performance.
Choosing the Right Approach for Your Goals
The decision between concept testing and test marketing depends on several factors: your product maturity, market size, development stage, budget, and time-to-launch.
If you’re refining an early-stage idea, concept testing is likely the more appropriate tool. It offers clear, focused insights on product appeal, naming, features, or messaging without the expense of a launch. For businesses seeking stakeholder buy-in or alignment across teams, the data from concept testing can also serve as a compelling proof point.
If your product is nearly market-ready and you’re looking to validate your broader marketing strategy before scaling, test marketing is invaluable. It helps you identify which channels deliver the strongest ROI, how your product performs in real-world conditions, and whether your pricing strategy holds up outside of the lab.
A Smarter Way to Launch
Ultimately, both methods can work together to de-risk the product development journey. Concept testing helps ensure you are building the right product, while test marketing confirms that you’re bringing it to market in the right way.
By starting with concept testing, you make sure the idea resonates. By following with test marketing, you fine-tune your execution. Used together, they offer a structured, data-led path to a confident launch—reducing uncertainty and improving the likelihood of success.
FAQs About Test Marketing
What is test marketing in new product development? Test marketing is the process of launching a new product in a limited market or region to evaluate its performance before a full-scale rollout. It helps brands test not just the product itself, but the entire go-to-market strategy, including advertising, pricing, and distribution.
What are the advantages of test marketing? The main advantages include gaining real-world insights into consumer behaviour, testing marketing channels and distribution strategies, forecasting sales more accurately, and identifying potential issues before a full launch. It also provides valuable data to secure internal buy-in or refine product positioning.
What are the disadvantages of test marketing? Test marketing can be expensive and time-consuming. It may delay a product’s official launch and expose your strategy to competitors. If the test market is not well-chosen or representative, the results can also be misleading, giving you a false sense of confidence—or concern.
How is test marketing different from concept testing? Concept testing occurs early in the product development process and focuses on evaluating consumer reactions to a product idea, typically through surveys or focus groups. Test marketing happens later and involves launching the actual product in a real market environment to test the full marketing plan.
Is test marketing always necessary? Not always. While test marketing is useful for mass-market consumer products, some businesses may opt for digital prototypes, A/B testing, or virtual simulations to save time and cost. The decision often depends on the product’s complexity, market size, and investment level.
How long should a test marketing phase last? There is no fixed rule, but most test marketing campaigns run between 3 to 12 months. The duration depends on the buying cycle, product category, and the time needed to gather statistically significant results.
Can test marketing predict long-term success? Test marketing offers strong indicators, but it is not a guarantee of long-term success. Market conditions, competitive responses, and broader trends can shift after launch. However, it provides the best available snapshot of how your product and strategy will perform under realistic conditions.
At Kadence, we specialise in concept testing that gives you clear, actionable insights before you go to market. If you’re developing a new product or refining an idea, our research can help you reduce risk and maximise success. Request a proposal or contact your local Kadence office to explore how we can support your next launch.
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Sales & Marketing
General Manager PR -Internal Communications & Government Affairs
Vital Strategies
Customer Intelligence Director