Understanding Customer’s Need for Business/Product
Identifying New Product Opportunities
There are various ways to identify New Product Opportunities
- Identify changes in user lifestyles, demography.
- Identify frustrations with the existing product.
- Identify innovations of lead users of the product.
- Identify blank spaces in the buyer utility map.
- Regularly Learning from competitors’ Products can also help you identify new Product Opportunities.
Buyer’s Utility Map
Buyer’s Utility Map opens the opportunities to look at new spaces where a company can compete rather than competing in spaces in which competitors are competing in.
Analyze each quadrant and figure out what you do and what your competitors do. Try to innovate in the empty boxes (Blue Zone) as focusing on these areas can give your Product an added advantage. The value that you add and your competitors add falls in Red Zone and there is nothing much that you can focus on in these areas.
To develop a superior product, it's important for a company to understand these frustrations.
- Who are lead users? Users those who are using the Product daily.
- Types of lead users
Building Superior User Experience
Peter Morville’s Honeycomb shows all dimensions which can be used to improve user experience. Some of the dimensions are useful, usable, desirable, findable, accessible, credible, valuable. Value is the core of Peter Morville’s Honeycomb. Having a great customer experience can add exponential growth to the Product and Business. The customer is the King after all!
Market Research for New Product (Sources of User’s information)
Research indicates that just a limited number of as low as 30 is enough to identify 90–95% of the needs of users. Usually, this is done by the Sales and Marketing team to identify the missing gaps.
Kano’s Model of User Preferences
Kano classified the preferences into five different types to show what really matters to the users and in what way. These are-
- Must-Haves (it is essential to include them)
- Attractive (unexpected and can be premium)
- One-Dimensional (will pay more if required)
- Indifferent (no impact — users will not pay)
- Reverse (negative impact -users will reject)
Adding Musthave feature is the first criteria for a new product and then adding attractive features to enhance the user experience to the next level and charge a premium.
Product Variety Matrix
Creating product variety allows a consumer to seek out a configuration that they value based on the budget they have. So having more product variety actually gives a competitive advantage to a company over others having fewer configurations. Giving more offerings at a certain price to the customers can add a huge customer base to your Product.
Quality Function Deployment (QFD)
Quality Function Deployment (QFD) helps in the product development process. It improves product quality and reduces the cost of making late design changes. Without QFD, it is more likely that design changes will happen much later in the product development cycle and these late design changes are very costly.
Some of the benefits of QFD-
- Increased customer satisfaction because you have used the QFD process and you have identified customer needs early and you have identified how to benchmark it very effectively with competitors.
- Improved development cycles It enhances the quality of the new product, it also leads to the new product is less costly to make. The new product is delivered on schedule because you are making fewer design changes and the new product is exactly what the customers wanted. So overall, there is increased customer satisfaction from the QFD process. There is also an improvement in the development cycle. Overall, having QFD reduces the cycle time and leads to a shorter development cycle. It also results in earlier resolution of design changes and minimizes the startup difficulties that are faced by companies when a new product is launched.
- Better internal knowledge transfer: The Diagram is well explainable and cross teams can benefit from this.
User Tool Kits
Toolkits encourage users to experiment with their requirements and discover new configurations which may be ignored by the firm. User tool-kits are an effective response to the difficulty in assessing user needs accurately. It is also a good response to highly heterogeneous demand in the product category which is very difficult to meet directly.
Toolkits enable users to experiment with the product features in relation to their specific needs and to customize their own products for themselves. User tool-kits are an effective response to the difficulty in assessing user needs accurately. It is also a good response to highly heterogeneous demand in the product category which is very difficult to meet directly. Higher customization is often desired by users and can be provided by the company using toolkits. A toolkit enables users to customize the product as per their tastes and preferences. Once the user has designed a toolkit-based prototype for themselves the firm takes over and can deliver the product as per the prototype. The toolkit approach has been found to have scope in a wide range of industries.
For example, Fashion designers provide a toolkit of accessory patterns for users to combine in using their product. Jewelers have provided a video wall for women to try a range of jewelry on the image on the screen.
- Toolkit should enable users to make complete cycles of trial and error learning within the tool-kit.
- The toolkit should provide adequate solutions space within the toolkit to cover all the high potential designs that the customers may want.
- Tool kits should be user-friendly. Users can use their own design language and simple design skills to design the product of their liking.
- Tool-kits also contain an adequate library of commonly used modules for its users.
For example, if it’s a travel website it should have a calendar feature that enables you to check which date is which day of the week and whether the timings are right or not. So all these features help the user not make mistakes while designing the product for themselves. Tool kits are also such that users' designs are easily translated without making any minor revisions. As you can understand if the company makes revisions to the design that the user has developed then there will be dissonance for the user.
The ATAR Model helps in tracking how many users have come back to use the Product and have recommended the product to their Network.
Notes from IIMB course (IIMBx EP103) on edX. Here is the summary from Week1 of the Course on New Product Development (Business Model and strategy, Business Model Example: Uber Taxi Service, Product Funnel, Mission Statement)