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    Volume Forecast For New Products

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    Preyanshu Saini
    The document discusses market research methods for new product introductions, specifically simulated test markets (STMs). STMs collect data on consumer responses to new product concepts and marketing plans in order to forecast sales volumes before launch. The document outlines several STM approaches, including BASES, and how they quantify purchase intentions from concept tests and product trials to generate sales volume estimates adjusted for marketing factors. It also describes key aspects of STM studies such as concept stimuli, consumer surveys, sampling methods, and variables measured to validate new product concepts and estimate their market potential.

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    © All Rights Reserved
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    Volume Forecast For New Products

    Uploaded by

    Preyanshu Saini
    75 views35 pages
    The document discusses market research methods for new product introductions, specifically simulated test markets (STMs). STMs collect data on consumer responses to new product concepts and marketing plans in order to forecast sales volumes before launch. The document outlines several STM approaches, including BASES, and how they quantify purchase intentions from concept tests and product trials to generate sales volume estimates adjusted for marketing factors. It also describes key aspects of STM studies such as concept stimuli, consumer surveys, sampling methods, and variables measured to validate new product concepts and estimate their market potential.

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    The document discusses market research methods for new product introductions, specifically simulated test markets (STMs). STMs collect data on consumer responses to new product concepts and marketing plans in order to forecast sales volumes before launch. The document outlines several STM approaches, including BASES, and how they quantify purchase intentions from concept tests and product trials to generate sales volume estimates adjusted for marketing factors. It also describes key aspects of STM studies such as concept stimuli, consumer surveys, sampling methods, and variables measured to validate new product concepts and estimate their market potential.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    75 views35 pages

    Volume Forecast For New Products

    Uploaded by

    Preyanshu Saini
    The document discusses market research methods for new product introductions, specifically simulated test markets (STMs). STMs collect data on consumer responses to new product concepts and marketing plans in order to forecast sales volumes before launch. The document outlines several STM approaches, including BASES, and how they quantify purchase intentions from concept tests and product trials to generate sales volume estimates adjusted for marketing factors. It also describes key aspects of STM studies such as concept stimuli, consumer surveys, sampling methods, and variables measured to validate new product concepts and estimate their market potential.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 35

    Market Research for New

    Product Introduction
    Product Validation Research
    Potential Available
    Market Market

    Addressable
    /Target
    Market
    How should we define these in
    case of Tru Earth Pizza

    Potential Available
    Market Market

    Addressable
    /Target
    Market
    Market Demand

    Primary Secondary
    Market Penetration Index and
    Brand Penetration Index
    Market Penetration Index and
    Brand Penetration Index
    Brand Penetration Index

    Market Penetration Index


    Market Penetration Index and
    Brand Penetration Index
    Brand Penetration Index
    NEW ENTRANTS TO
    CATEGORY
    NEW PRODUCTS – SKUS,
    VARIANTS, LINE EXTENSIONS RETAIN LOYAL and
    if there is overlap between the PERSUADE to SWITCH
    current target market and PERSUADE TO CONSUME MORE
    proposed new product target EDUCATE ABOUT OTHER USAGES
    market, category extensions

    NEW ENTRANTS TO Market Penetration Index


    CATEGORY
    SWITCH
    PERSUADE to SWITCH
    MARKET FORECASTS
    Market Penetration Index and
    Brand Penetration Index
    Munna Pack of Brand Penetration Index
    NEW ENTRANTS AMUL
    TO Butter
    CATEGORY 10 Rs Milk Pouch Honey
    NEW PRODUCTS Sachets
    – SKUS, Condensed Milk
    VARIANTS, LINE AMUL cheese, AMUL
    EXTENSIONS RETAIN LOYAL and Dairy Whitener
    Lite-
    if there is overlap Many the
    between more… PERSUADE to SWITCH
    current target market and PERSUADE TO CONSUME MORE
    proposed new product target EDUCATE ABOUT OTHER USAGES
    market, category extensions

    NEW ENTRANTS TO Market Penetration Index


    CATEGORY
    SWITCH
    PERSUADE to SWITCH
    MARKET FORECASTS
    Private Labels in Mass
    Patanjali Ghee Consumption FMCG
    Fertilisers
    What about Market Penetration
    Index in case of Tru Earth?
    Brand Penetration Index

    Market Penetration Index


    Volume Forecasts
    Pre-Launch Product
    Validation Model
    SIMULATED TEST MARKETS
    • Sales Estimates of New Products/New Brands/
    New Extensions prior to launch
    • Used by Management to decide Go/No Go
    decisions
    STMs : Questions Addressed
    • What is the brand’s volume potential?
    – Trial and Repeat
    • What marketing plan elements drive volume, and
    how can the plan be improved?
    • What are the strengths and weaknesses of the
    concept and product?
    Pioneer work on STM began in
    1960s in business schools and
    MR agencies as well across the
    developed economies
    Designor
    Micro (1986)
    Test Novaction
    Perceptor (1980) Ipsos
    BASES (1979) Research (2001)
    (1977) Concept Internatio
    Assessor Testing nal
    (1973) Burke System Kantar to
    Sloan Nielsen Novaction TNS
    Schools (1998)
    (1989)
    Approach to forecast
    Purchase Intention Based Preference Share Based
    • Likelihood of Purchase • Purchase a product from
    on 5point scale given competitive set
    • BASES & MICROTEST • DESIGNOR and
    ASSESSOR
    • BASES included
    preference share
    approach later.
    BASES : Simulated Test
    Marketing
    “BASES is a comprehensive, validated sales
    estimating system which integrates consumer
    response data with manufacturers’ marketing plans to
    assess the volumetric potential of concepts and
    products prior to introduction.”

    BASES = Booz-Allen Sales Estimating System


    BASES : Simulated Test
    Marketing

    Consumer
    Response

    Distribution Advertising
    Plans Plans
    BASES : Simulated Test
    Marketing
    BASES is a
    comprehensive, validated
    Consumer
    Response sales estimating system
    which integrates
    consumer response data
    with manufacturers’
    Distribution Advertising marketing plans to assess
    Plans Plans
    the volumetric potential
    of concepts and products
    prior to introduction.”
    A Brief Evolutionary History
    • BASES, Burke Marketing Research
    – Developed by Dr. Lynn Y.S. Lin in 1977
    – BASES as a company started commercial operations in
    1986.
    – Bought by AC Nielsen in 1998.
    – Introduced in India in the same year.
    • Unilever now uses BASES for most of their STM
    research.
    – Earlier they were using their own model – Micro Test.
    Theoretical Underpinning
    • Consumers do not usually do what they claim to do.
    Theoretical Underpinning
    • Consumers do not usually do what they claim to do.
    – However a strong correlation is found between
    consumers’ claimed purchase behaviour and what
    subsequently transpires in the marketplace.
    .
    Theoretical Underpinning
    • Consumers tend to overstate their intended
    purchase behaviour.
    – The level of overstatement varies by country, by culture,
    and by measure.
    Theoretical Underpinning
    • Consumers do not usually do what they claim to do.
    – However a strong correlation is found between
    consumers’ claimed purchase behaviour and what
    subsequently transpires in the marketplace.
    • Consumers tend to overstate their intended
    purchase behaviour.
    – The level of overstatement varies by country, by culture,
    and by measure.
    Quantification of Volumes

    Pre Bases BASES I BASES II


    • Concept Test • Concept Tests • Concept Test BASES II Line
    with very rough with volume combined with
    volume estimates estimates within Product Test
    Extension
    25% accuracy • Estimates Volume
    range affected by Estimation
    sample size, in- incorporating
    home usage, impact of
    marketing plan
    presence of
    estimation, etc.
    brand in the
    • Estimates are
    found to be market
    highly reliable
    (within 80%)
    Which study is being
    planned for Pizza?
    Data Collection
    Concept
    Intercept
    Concept
    Recruitment Interviewing
    Stimulus
    Interviewing

    Product
    Product 2 week In-
    Interviewing
    Placement Home Usage
    Sampling – Quota Sampling
    Concept Stimulus
    • Concept board or commercial
    – Should contain as much information as will be conveyed
    by advertising or other mode of communication
    – Should also contain prices, sizes, and varieties
    Constructs in Consumer Survey
    Questionnaire
    • Key Measures
    – Purchase intent
    – Units per purchase
    – Value for the price
    – Intensity of liking
    – Uniqueness
    – Willingness to Pay
    • Diagnosis
    – Attribute Ratings
    – Likes/Dislikes
    – Source of Volume
    – Suggested Improvements (after use)
    CONCEPT PURCHASE INTENT
    Definitely Buy & Probably Buy

    ADJUSTED TRIAL
    Thumb Rules: 80% of Def Buy &
    30% of Probably Buy

    ENVIORNMENT ADJUSTMENT

    MARKETING PLAN
    ADJUSTMENT
    1. GRPs and Resultant Awareness
    2. Weighted Distribution

    Trial Volume = Target Households X Trial Rate X Trial Unit

    Repeat Volume = Repeat Rate X Repeat Occasions X Repeat Unit

    BASES Database serves as the primary device to be used for


    interpretation.
    Benchmarks available for Concept and Product After Use Trials
    and Repeats

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