You need know how your new product or service will perform in the marketplace by fully understanding the competitive landscape through product benchmarking. By mining and understanding the reference points used by consumers when evaluating your product, you can develop and innovate in a way that ensures the most success with your target audiences. In order to get the insights you need, you first need to understand what information will best serve the development or innovation of your product.
Getting the Metrics Right for Strategic Product Benchmarking
Understanding what metrics to use when measuring the future success of your product or service sets the basis for building a strategy that will work. For example, building a strategy focused on hedonics such as being the “best tasting” is vastly different than a strategy focused on perceptual metrics such as having a “clean label” or being the most “relaxing” or “energizing.” And both of these metrics are different from using a behavioral metrics such as “most frequently used” or “highest rate of repeat use”. It is critical to success of the product or brand to select benchmarking metrics which align with the brand pillars and product purpose. Do you know which ones you would use to set the basis for your product benchmarking research?
Using Product Benchmarking in Decision Making
Many innovation teams also use benchmarks as a decision-making metric. Benchmarks tend to be statistical tests that compare brands, concepts and products against competitive or baseline brands, concepts and products. For example, if your objective is to achieve advantage against a competitive brand for a particular product, then the benchmark might be to achieve a statistical win over the competitor by using a choice-based research method. Choice-based research methods include approaches like preference tests, ranking or max-diff assessment.
Applying Different Methods for Benchmarking Research
So, what metrics do you need? Once you know, you can determine the best research approach for your product benchmarking study. Two most common product benchmarking research methods are Central Location Tests (CLs) and Home Use Tests (HUTs). The CLT approach provides the greatest amount of control over the environment and testing approach, whereas the HUT provides the most realistic, in-the-moment, experience.
For example, if you need to understand how your kitchen cleaning product compares to the competition in terms of safety and cleanliness perception you can use a CLT approach. Through this research method, you will be able to ensure that the surfaces cleaned by your product and the competitors’ products are all the same in all aspects from starting point, to ventilation, to application. If you choose a HUT approach to understand your cleaning product in the competitive landscape, you will be receiving data from the widest variety of the most realistic situations. However, this may leave you unsure of how truly comparable the cleaning tasks are from home to home.
In a CLT, you may unknowingly control for a variable that allows for some products to score higher or lower and thus produce results which do not replicate in real life – or more commonly, show greater differences that what are perceived in real-life use cases. In a HUT, you may end up with too much variance in practice and could miss seeing a pattern where you have the opportunity to outperform the competition.
In order to do your product benchmarking study, you must not only decide on your metric, you must decide on your approach. Making a decision between a CLT and a HUT may be tough, but this is where understanding your benchmarking strategy becomes critical. If you are focused on a strategy that is claims and performance oriented, you will have better repeatable data with a CLT design where you can control the environment and experience. If your strategy is more behavioral then you will want to see how your product performs in the most realistic situations possible like a HUT, so that you can identify how well you compare to competition on the cues driving the behavior.
Want to learn more about how to effectively use product benchmarking to ensure your product’s success in market? Reach out to us.