3. Concept Definition and Evaluation

Question 1

Definition of concept

Answer 1

A concept is more developed and defined than the idea, but not yet complete tangibilization of the idea. Consists of brief but explicit description of how an idea will translate into customer value and why it will capture customer interest and purchase intent.

Question 2

Concept dimension - intended target group

Answer 2

• which segments can be identified?
• how attractive are these segments?
• which segments should be served?

Question 3

Concept dimension - intended positioning

Answer 3

• which product attributes are relevant for potential customers?
• how are competitive products positioned in the market?
• along which dimension should the product be positioned in the perception of customers?

Question 4

Concept dimension - unique selling proposition

Answer 4

• which unique selling proposition (USP) should a product deliver?
• which positioning can help to differentiate the product from the competition?

Question 5

Concept dimension - product features

Answer 5

• how should the attribute values be defined?

* what are the requirements with regard to product design and product image?

Question 6

Conjoint analysis

Answer 6

Conjoint analysis is a survey-based statistical technique that helps determine how customers value different attributes that make up an individual product or service

• different versions of a product are presented to participants
• implies tradeoffs and rating their relative preferences
• implicit valuation can be determined via regression technique

Question 7

Steps in conjoint analysis

Answer 7

1. Determine attributes and attribute levels
   • which attributes do customers consider
   • which levels of these attributes are relevant?
2. Select attribute profiles to be measured
   • full factorial design: all possible combinations
   •fractional factorial design: contains only certain attribute level combinations
3. Choose a method of stimulus representation
   • how should the profiles be presented to respondents?
   • the more realistic the better
   • describe attributes in customer-oriented language
4. Select a response method and collect data
   •rank profiles in order of preference
   •evaluate products on a rating scale
   • pairwise evaluation of profiles and rating of preferences
   • let respondents choose one product from a set of alternatives including a no-choice
5. Choose a method of data analysis
   •dummy variable regression, logit models
   • analyzing each respondent individually is inefficient

Question 8

Further steps in conjoint analysis

Answer 8

6. Analyze the data
   • for each respondent, estimate utilities for each attribute level
   • create benefit segments by grouping respondents based on their parthworth utilities
   • see if demographic differences exist between benefit valuations
   • determine relative importance of each attribute for each segment
7. Use the results
   • conduct market simulations to obtain share estimates for new concepts
   •assess competitive concepts
   • compare utilities within and across attributes to identify particular important attributes and desirable levels

Question 9

Dimensions of a concept

Answer 9

• intended target groups/segments
• intended positioning
• unique selling proposition
• product features

Question 10

Innovation of the day: Amabrush

Answer 10

• Example description: First automatic toothbrush that brushes teeth in less than 10 seconds
• What made it stand out: Founders understood effort and time spent on brushing teeth is considered waste and developed automatic toothbrush
• How does it relate to concepts we have discussed previously: It is a breakthrough innovation on both product and market level and a blue ocean example of oral care market