In order to guide future product development and pricing strategies, a security products provider for home and businesses sought to better understand what tradeoffs homeowners and professionals make when selecting door hardware at various price points.
The primary objectives of the market research project were to:
- Assess the importance of various product features for door hardware across a range of price points.
- Isolate market preferences and trade-offs among product features for door hardware.
- Measure pricing elasticity and optimal pricing of door hardware with desired feature set configurations and competitive feature sets.
- Determine market receptivity to the client’s concept, their current product, and against competition.
To secure answers, the market research team at The Farnsworth Group used conjoint analysis whereby homeowners and pros were presented with an online survey in which they decided which of different hypothetical product alternatives they prefer.
Each product alternative was made up of a different combination of attributes (brand, price, warranty, etc), in which participants were forced to make trade-offs, as they would in real-world decisions.
Through these choices, The Farnsworth Group was able to uncover relative preference and importance of each attribute. Real world buying scenarios were then tested and purchase results measured to determine share preference based on changes to the attributes. Pricing was also evaluated to determine how preference changed as price increased or decreased.
While price is an important factor when making a product selection, it’s not the only factor. There were two other attributes that had a large impact on which product was selected. Depending on if those attributes were included, and to what degree, had a significant positive or negative impact on product preference.
These findings were used to challenge false assumptions that were driving poor business outcomes.
This client has used the data garnered from their custom market research project to guide their product development strategies and focus on improving product attributes that drive purchase.
Further, measuring price elasticity helped the client determine optimal pricing for desired feature sets in door hardware.
Finally, the client was able to gauge the acceptance of a new concept versus their current product or the competitors product to guide sales and marketing decisions.