Customer-Centric Product Innovation: Designing for Customer Satisfaction

Consumer Research has Transformed in a Dramatic Way

The increased availability of data over the past several years has meaningfully changed the way companies engage with their consumers. New measurement capabilities, especially those utilizing AI, enable access to more information related to how, when, and why people purchase their innovative products than ever before.

That said, the increased complexity of data and measurement tools has also increased the level of rigor needed to uncover meaningful insights. Within this new landscape, how do businesses separate signal from noise? Successful navigation of that challenge has potential to unlock billions of dollars in value.

How Do You Innovate Your Product?

Whether you’re focused on targeted product innovation or the strategic direction of your entire business, it’s crucial for decision-makers to harness the power of data analytics and foster a culture of customer-centricity. While these elements are pivotal to a successful innovation strategy, their application is also multi-faceted, which means that there cannot be a “one-size-fits-all” approach.

Bellomy recognizes the need for strategies that are specifically tailored to a client's needs. Before any engagement, a knowledgeable team of researchers first aims to understand your unique situation and innovation priorities. Building on this foundation, the team then leverages a full suite of research designs and analytical capabilities to meet the specific needs and stage of the innovation being tested. This ensures a more purposeful solution that accounts for the unique characteristics of any new idea.

The range of potential innovation priorities is broad, reflecting the customized approach required. That’s why across the span of market research literature, you’ll find that everyone defines the product innovation journey a bit differently. Nonetheless, the primary objective for any one product innovation can still be summarized under a few primary categories:

Grow the brand with broadly appealing initiatives

These types of innovations generally constitute a minor subsection of a portfolio but represent a significant portion of total portfolio volume. Consumers demonstrate demand for these innovations, which often result in increased strength of the brand.

In addition, this general enthusiasm is not just a reflection of a product’s initial appeal, but also an indicator of its potential to secure customer loyalty base over time. That appeal translates into volume business growth by expanding the range of potential usage occasions, or new opportunities, enhancing existing product benefits in a meaningful way, or finding a way to add a premium level to the innovative product.By innovating a portfolio with products like this, brands can attract a wider user base and create more value for their potential customers, which in turn contributes to brand expansion and the enrichment of the customer and overall market segment. Ultimately, strategic innovations with broad consumer acceptance like these not only serve to expand the overall footprint of the brand, but also to reinforce its existing position in the market.

Keep things fresh with routine extensions

These innovations are meant to defend existing brand equity and expand the overall product line, which helps maintain consumer interest and engagement — crucial because competitors are constantly launching their own new product offerings and consumers often choose brands depending on the specific context of the purchase. Even minor innovations of existing product lines can help increase the overall salience of a brand to consumers.

This process can involve introducing a variety of new offerings to existing lines like flavor extensions, size extensions, or package redesigns. The goal of any new extension or redesign is to attract new best customers or expand the base of existing customers. Testing and research prior to release of these offerings can help ensure these goals are met and mitigate potential cannibalization among current buyers. Extensions like this play an important strategic role for a brand, and often constitute the largest portion of innovations in a portfolio.

Enter new territories or target new consumers

This last category of innovation development refers to a narrower cross-section of the market. Targeted product development involves expanding the overall reach of the brand by exploring untapped areas of the market or new demographic segments without alienating the core customer base. The aim of these innovations is to identify, develop and capitalize on new growth opportunities, where the primary equity of a brand can be leveraged to meet a new consumer or market.

While this has potential to identify emerging market segments early, it also requires that brands engage in thorough market research beforehand to support the launch of the innovation. Retailer acceptance can often be more limited due to the velocities these existing products exhibit, especially during the first year, which makes it even more important that a business be equipped with the right data to support the launch.

Across each of these innovation types, it’s also important that you identify potential “barriers to purchase” for consumers. Researchers must understand the product characteristics that persuade or dissuade consumers from purchasing a product, while also identifying ways to disrupt the existing routines of potential consumers. This means driving both physical and mental availability for products and services innovations.

In a traditional sense, ensuring physical availability is simple — it means driving distribution across retailers where your audience will be shopping. Mental availability can be a bit more complicated. This comes through developing a product that serves a consumer need and then reinforcing “memory structures” among consumers that prompt them to think of your product when shopping. Consumers experience brands and new products in many different contexts, all of which can influence the likelihood that they think of your item when making a purchase decision. Both heuristics require a deep understanding of the consumer to understand how your product might fit into their life.

For Innovation Success, the Solution Objective Must Align with Research Results

Fundamentally, all innovations serve a purpose in a full product development portfolio. Not every launch is meant to be a blockbuster, and it is essential to have the organizational tools to balance a multi-faceted innovation pipeline that serves a diverse set of preferences. This dynamic approach to market research is the bedrock of Bellomy’s business philosophy. Many companies offer research capabilities related to product and service innovation, and fundamentally, these tactics are often straightforward. The primary question becomes whether those tactics generate useful insights, and more importantly, how one implements a strategy based on those insights.

At Bellomy, our focus is clear and singular — innovation done right. Our teams possess the technical acumen to run complex research designs, while also bringing a wealth of category and topic expertise, problem solving skills, and a technology platform that’s adaptable stay relevant to a dynamic innovation landscape. We can leverage our full platform to play a significant role in the innovation cycle, or alternatively, provide nimble support in specific ways. This guarantees that you receive comprehensive support, not only in generating insights for your ideas but also in executing a strategy that is specifically crafted based on those insights.

Reimagining Market Research: Understanding and Exceeding Customer Expectations with Bellomy's Customer-First Approach

Traditional surveys struggle with a variety of biases under the framework of total survey error, including things like non-representative sampling or memory limitations among respondents. Despite those challenges, many businesses continue using them to inform their market strategy, which negatively impacts the success potential companies have for their innovation pipeline. In contrast, Bellomy implements a customer-first approach that represents a shift from the old way of doing market research.

Customer-centric strategies require a deep understanding of overall satisfaction levels among consumers and an organizational commitment to improving customer satisfaction. That requires one to look beyond traditional approaches to uncover new insights. While even happy customers have distinct needs and preferences in the marketplace, they often struggle with generating solutions.

Therefore, the job falls to manufacturers, who must understand and service those needs. In the modern world of market research, consumer acceptance must be evaluated at a more granular level than ever before. This requires a comprehensive analytical toolkit.

Innovating Along the Research Path: Exploring Diverse Techniques

A truly comprehensive toolkit requires a wide range of solutions along the entire innovation path. These types of methodologies not only offer a more nuanced view of the consumer landscape, but also empower businesses to make more informed decisions. Though the entire list is wide-ranging, the section below outlines some examples of the diverse techniques being leveraged in the industry today.

MaxDiff Example

MaxDiff, or Maximum Difference Scaling, allows researchers to evaluate dozens of different product attributes. In early-stage concept ideation, businesses often want to understand new features, their pain points and following benefits that are most important to consumers. However, when tasked with ranking a long list of attributes, consumers often struggle with cognitive overload. This requires that consumers make numerous comparative judgements, and as the size of the list increases, the level of thoughtfulness in responses often declines.

MaxDiff solves this this by asking people to rank a series of attribute sets, helping to reduce cognitive overload while simultaneously increasing the level of discrimination between different product attributes compared to a basic ranking task. This helps highlight subtle preferences among consumers that may not have otherwise emerged in a traditional rank-order exercise.

Case Study: Leveraging Customer Preferences and Feedback to Enhance Sell-In Meetings

A manufacturer that develops products that sell in home improvement stores, furniture stores, and wholesalers wanted to leverage feedback data in upcoming sell-in meetings with retailers. Unfortunately, they did not have experience conducting market research. Bellomy adopted a customized multistep survey process innovation that leveraged MaxDiff to have customers answer their questions.

First, Bellomy instituted an innovative Tinder-style swipe right/swipe left system (right = like, left = dislike) to help respondents quickly identify their perceptions of different styles. The manufacturer had several different product designs and needed to narrow the list to a few key ideas.

From there, Bellomy leveraged a customized Relevant Items MaxDiff analysis to gather feedback on concept appeal and purchase likelihood for each design. This analysis helped increase the likelihood of retail sell-in success for improved products, while also providing numbers that helped validate the product designs to both internal and external partners.

Choice-Based Conjoint

When possible, simulating real-life purchase decisions in a dynamic or simulated environment is the preferred approach because it enables respondents to evaluate products as if they were making an actual purchase. Choice-Based Conjoint (CBC), or Discrete Choice, does this by evaluating the relative acceptance of “conjoined features.”

This type of analysis is particularly useful for understanding and predicting how people make choices when faced with tradeoffs, like choosing snacks or beverages. During this exercise, consumers are shown a series of choice tasks related to product selection, which requires them to evaluate a variety of different product configurations of features like brand, flavor, format, or price. From this analysis, Bellomy can determine the product configurations that maximize the overall share of preference for a product line.

Bellomy ResTech Capabilities

With recent developments in digital survey methods, Bellomy can leverage its analytics platform to run various conjoint methods to help predict how real-life consumers will make decisions when faced with tradeoffs. Traditional Choice-Based Conjoint evaluates the relative acceptance of different product attributes.

CBC can be further bolstered with shelf set visualizations, which can be informative for teams hoping to understand the impact that things like packaging design or price changes might have on an innovation’s potential. An Adaptive Choice-Based Conjoint (ACBC) can be leveraged to understand conjoint designs that contain many different attributes or levels.

Rather than presenting every respondent with choices from a comprehensive list of attributes and level combinations, the options provided can be customized to align with everyone’s unique preferences.

These methods are supported by an in-house Advanced Analytics team, comprised of skilled statisticians with experience in choice-based methodologies. All of this helps bridge the gap between theoretical shopping choices in a survey and the practical realities of shopping at a genuine retail outlet. Armed with that information, businesses can strategically execute product innovations that optimize shelf placement, product assortment, and packaging design in a way that maximizes retail sales and overall sales incrementally.

AI-Driven Analytics

The recent growth in AI-driven analytics marks a new age in product innovation. AI extends traditional analytic techniques by efficiently extracting deep insights from large and complicated datasets. With these capabilities, businesses can anticipate consumer needs and capitalize on growing market trends with increased agility. Whereas in the past unstructured data from survey open-ends, online customer reviews, or call center feedback took hours to analyze (or did not get analyzed at all), the advent of AI-driven text analysis tools adds both breadth and depth to examination of customer feedback data. This impacts all phases of the innovation journey, whether it be initial concept ideation or post-purchase review monitoring.

Bellomy has taken a major step in this direction with the introduction of Bellomy AI Analytics for Text. The tool was first developed after our research team explored third-party text analytics capabilities and realized there was a disconnect between the tools developed by those software providers and the solutions sought by researchers.

Using the slowdown in business and research needs during the COVID-19 pandemic effectively, we leveraged our existing infrastructure and in-house expertise to develop a bespoke tool capable of analyzing vast quantities of unstructured text with the precision and customization businesses need.

Case Study

A major grocery retailer was undergoing rapid expansion with mixed success. Researchers at the retailer wanted to understand why certain stores outperformed others, as well as what needed to change at the struggling stores. Bellomy leveraged the AI Analytics for Text platform to quickly analyze over 260,000 online store reviews and open-ended comments to help identify a solution.

This process involved multiple steps. First, the tool was used to analyze Google Store reviews for the client’s stores and competitors. Furthermore, problem stores were compared to successful stores using ‘impact scores’ to better understand the strengths and weakness for the business. Lastly, a retail-specific AI topic model was trained to deliver relevant and accurate insights for the industry.

From there, Bellomy AI Analytics for Text was able to transform the plethora of different consumer opinions into actionable data for the business. The technology identified common themes for the highest performing stores and clarified the key drivers of negative reviews in problem stores. The findings were highly prescriptive, which allowed the retailer to focus energy on solving those problems.

The Path Forward

In today's dynamic market research landscape, businesses need a personalized market research strategy supported by an advanced analytical framework. This requires effective analytical tools and a dedicated team of expert, passionate researchers committed to delivering results. Bellomy understands that successful product innovation relies upon a measurement system that starts with your consumers and adapts an approach from there.

To ensure that product innovations hit the mark, it’s crucial that businesses identify the granular preferences of consumers first before diving into other areas of research. Bellomy’s approach involves a diligent examination of consumer feedback across measures such as demographics, shelf contexts, and pack designs to pinpoint exactly what drives the highest level of consumer appeal and retail sales. This granular insight helps empower businesses to make informed decisions that align with existing consumer expectations and anticipate future needs before they arise.

By prioritizing and measuring customer satisfaction and integrating innovative strategies, businesses can adeptly navigate market fluctuations and deliver products that deeply resonate with consumers. Whether you’re at the initial stages of your innovation journey or seeking to measure the post-use new customer experience and satisfaction, Bellomy can utilize industry expertise, advanced analytics, and in-house technology to answer your critical business questions.

To discuss solutions for a business challenge, initiate a consultation at www.Bellomy.Com/consultation.