Testing Concept: Market Simulation to Achieve Product Success

Technology marketers are harnessing predictive tools to drive market success. Such tools have been widely used in traditional industries such as packaged goods and retail. Now, these same tools are proving invaluable to Technology Company’s feature set and pricing decisions across a wide variety of products and services, ranging from cell phones and tablets to enterprise software licensing. The price you are willing to pay, the features you must or must not have for the price offered, the perceived value of a specific set of features; all can now be dynamically measured, tested and retested is ways that would have been difficult to achieve only a few years ago.

Qualified quantitative analysis teams can adapt these tools to complex pricing and feature set decisions related to technology products and services. These research techniques help technology marketers optimize their offerings to maximize share, revenue and/or profits. Built to be statistically valid based on the research areas of discrete choice modeling, trade-off analysis and conjoint exercises, the research processes harness vast amounts of detailed customer preference data into a managerially useful and predictive market simulators. When properly designed and executed, the simulator can be akin to having a room full of customers always ready to vote on realistic “what-if” product choices.

These research techniques are crucial when the market goals include:

1. Guiding product feature bundles or SKUs;
2. Determining optimal product price points;
3. Measuring and tracking competitive brands values;
4. Maximizing market share versus competition;
5. Minimizing cannibalization from new product offerings;
6. Developing product based segmentation strategies;
7. Tapping niche customer markets.

The value in these tools is the ability to test and retest at near zero incremental cost. Once the data has been gathered and analyzed, manipulation to test assumptions is an easy task. Wherever price and product features intersect, the knowledge gained through a predictive market simulation can greatly increase a product or services success at the price point desired.