Consumer Understanding for

Innovation

A presentation to Microsoft India October 2010

The Debate

Consumer & Market Research

Consumer & Market Research

• • • •

Helpful Required A must To know what consumers want • Risk reduction

• Misleading • Time wasting • Consumers don’t know what they want • Willing to take risks

Follow the Consumer

Lead the Consumer

Beyond Debate

Consumer Understanding is critical for success - in NPD & Innovation

What do we mean by Innovation?

A new (way) that creates economic value for the business

Innovative Products

What sets them apart?

All are based upon a powerful concept or idea

The Ideas Continuum

Example 1: Two Wheelers

A new kind of a 2 - wheeler Scooterette
New model of a motor-bike or scooter

Example 2: Dish wash products
Vacuum-based Suction device for dish cleaning

Dish wash paste Dish wash liquid

A new variant of a dish wash bar

Example 3 : Books

EBook Audio Book

A new genre of book in paper back or hard back

The kind of consumer understanding we need depends upon the kind of product we are aiming to create

The Task

Design a new kind of word-processing software

Consumer Understanding: Due Diligence Information
Consumer profile Usage behavior Choice criteria Preferences Segmentation Performance benchmarking

Consumer Understanding: Insights

Deeper probing into the real Motivations and cultural software behind consumer choice Searching for Latent needs

Consumer Understanding: Intimacy
Intimate appreciation of Consumer life space, product experience and context

Levels of Consumer Understanding

Due diligence Information Stated need gaps from the product category/brand Consumer Insight Deeper probe into the real motivations and cultural software driving choice Consumer Intimacy Intimate appreciation of the consumer’s life space and product experience context – to identify next gen problems and solutions and dream up new concepts

The Product Development Puzzle
The consumer faces a problem.

The product development team has identified it.

They design and make a technically superior product to current options.

Would the consumer immediately want to buy it to replace their current option?

The Irrationality of Human Choices
“Perceived to be superior” – the effect of framing / positioning “Habit / inertia” – the effect of the comfort zone

“Price-value equation” – the effect of money and budget Management pressures “Peer group and social conformity” – demonstration effect Pleasure, delight, relationships – the effect of non performance factors

From Product Proposition

>> To Consumer Proposition

From Consumer Understanding for Product Development – Development Research

To Consumer Validation of product concept and marketing mix – Validation Research

Consumer Understanding for Innovation

Information Insight

Intimacy

Imagination

Implementation

The Debate

Consumer & Market Research

Consumer & Market Research

• • • •

Helpful Required A must To know what consumers want • Risk reduction

• Misleading • Time wasting • Consumers don’t know what they want • Willing to take risks

Follow the Consumer

Lead the Consumer

The End