New Product Development

What do our customers really want in terms of new products?
Our product development efforts need to focus on delivering more value to our customers – how can we link customer values into our product design process?
We are about to launch a new product line which will provide additional value to our customers – how do we price for this additional value?
If we introduce a new product, how will it affect sales of our other products and of our competitors’ products?

Marketing executives are faced with these and many similar issues every day. Managing new product introductions – from understanding product positioning to pricing for value – is one of the most complex and important marketing functions. Fortunately, there are proven marketing research tools that are available to help answer these tough questions.

The Allegheny Marketing Group (AMG) provides custom-designed market research specifically tailored for each project. Through careful planning and research design, we are able to help clients:

Include the “voice of the customer” in early product design stages

Eliminate product ideas with little market potential before a significant capital investment is made

Understand product features offering the greatest value to customers

Develop a pricing strategy to capture the value customers are receiving

The following are actual examples of projects conducted by the Allegheny Marketing Group:

Case Study 1

A leading medical device company already held a dominant market share position in their major markets. However, new competitors were entering the market and they had not introduced a new product in the last three years. Without new products, their market share may be gradually eroded.

A new product launch was planned, and market research was needed to understand how the new product line would be positioned and priced in the market. The analysis focused on understanding how both customers and non-customers valued different product attributes. With this knowledge, numerous "what-if" scenarios could be conducted to determine the effects of different product packages on the market.

By understanding the relative value of different product attributes, product features could be bundled or unbundled to justify different price points. The new products were successfully launched.

Case Study 2

An automotive and truck lighting supplier wanted to investigate the feasibility of two new products which the company was considering for manufacture. The new products would utilize a new infrared (IR) technology to keep track of engine diagnostics and automatic registering. However, the IR technology would compete with other technologies for these same applications. The question was which of these technologies would become dominant and whether there would be a market for the IR product.

The Allegheny Marketing Group conducted primary research with potential customers, industry experts, and trade organizations to understand how the market would develop. Our client was able to use the information to justify continued research expenditure on the new product concept.

Case Study 3

A leading supplier of heavy-duty truck components was in the final development stages of a new engine diagnostic tool. This tool would be sold to service technicians at truck dealers and independent garages and would be used to diagnose potential service issues. The client had information on competing products, but needed sufficient information to price this product and identify preferred sales channels.

AMG conducted primary research with service technicians at dealer garages to understand how this product would be used, how it should be priced, and where these technicians would purchase the product. Based on our findings, the client raised the price of the new product by almost 50% and identified a sales partner to effectively reach this customer group.