Consumer research in the early stages of new product development : issues and applications in the food domain

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Consumer research in
the early stages of new
product development

Issues and applications in the food domain

















Ellen van Kleef

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Promotor: prof. dr. ir. J.C.M. van Trijp
Hoogleraar in de marktkunde en het consumentengedrag
Wageningen Universiteit
dr. ir. P.A. Luning
Universitair docent
Leerstoelgroep Productontwerpen en Kwaliteitskunde
Wageningen Universiteit
Co-promotor:


























Promotiecommissie:

prof. dr. ir. M.A.J.S. van Boekel, Wageningen Universiteit,
Nederland
prof. dr. K.G. Grunert, The Aarhus School of Business, Denmark
prof. dr. C.M.J. van Woerkum, Wageningen Universiteit,
Nederland
prof. dr. J.P.L. Schoormans, Technische Universiteit Delft,
Nederland











Dit onderzoek is uitgevoerd binnen de onderzoekschool VLAG
(Voeding, Levensmiddelentechnologie, Agrobiotechnologie en Gezondheid)

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Consumer research in the early
stages of new product development

Issues and applications in the food domain







Ellen van Kleef












Proefschrift
ter verkrijging van de graad van doctor
op gezag van de rector magnificus
van Wageningen Universiteit
prof. dr. M.J. Kropff
in het openbaar te verdedigen
op vrijdag 6 januari 2006
des namiddags te half twee in de Aula

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Van Kleef, Ellen
Consumer research in the early stages of new product development. Issues and applications
in the food domain/Ellen van Kleef
PhD-thesis, Wageningen University. – With ref. – With summary in Dutch
ISBN: 90-8504-330-1

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Voor Muji en Rima

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Abstract




New products that deliver added consumer value contribute significantly to the success of
companies. In the numerous studies of new product performance over the years, consensus
has developed that understanding consumer needs is of paramount strategic value, especially
in the early stages of the product development process. During these early stages, the product
has not yet been specified and the aim is to search for novel product ideas from a marketing
and technological perspective. Despite their importance, several studies indicate that
consumer research methodologies are underutilised in the early stages of new product
development. The aim of this thesis is to analyse key issues and develop and illustrate
appropriate consumer research methodology at early stages of the new product development
process, as this is one of the most distinguishing characteristics of successful product
development projects.
Consumer research can be confirmative in its focus of testing new product concepts
before launch and in this way prevents unjustified investments. Consumer research can also
be proactive in that it aims to identify new product ideas that deliver against consumer needs
that are not yet fulfilled by products currently in the market. Successful new product
development requires a balance between both types of consumer research. The research in
this thesis focuses on the optimal application of both types of consumer research in the early
stages of the development process, in particular in providing guidance in generating and
validating new product concepts. In the first chapter, the importance of new product
development is presented and key factors of success and failure are discussed. Specially, the
need for consumer research in the early stages is considered and criteria for effective strategic
consumer research are outlined.
In chapter 2, ten frequently used methods and techniques to uncover unmet consumer
needs and wants are critically reviewed. Each of the following empirical chapters focuses on a
specific aspect of the problems associated with selecting and implementing appropriate
consumer research in the early stages of the product development process. Chapter 3
presents a framework which allows obtaining relevant consumer and expert feedback in an
early stage of the product development process. By systematically generating and rigorously
screening a large set of product concepts both inside (experts) and outside (consumers) the
company, the framework shows the extent to which experts and consumer agree about new
product opportunities and in this way prevents that high potential opportunities are overlooked.

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Chapter 4 illustrates the problem of successful functional food innovation. This chapter
provides insight in a number of strategic decisions that have to be taken in the early stages of
the development process in relation to health claim formulation, segment determination and
product selection. Chapter 5 provides a comprehensive conceptual and empirical comparison
of internal and external preference analysis. In addition to a comparison on statistical criteria,
this study explicitly takes the end-user perspective into account by comparing both techniques
on various end-user criteria. The final empirical chapter in this thesis (chapter 6) studies the
added value of the innovation templates approach in generating and screening new product
ideas. Chapter 7 summarizes the results of the previous chapters and describes the limitations
of this thesis. Overall, the results of this thesis contribute to the better recognition of the
importance of consumer research in early stages of new product development and suggest
methodologies that could support effective marketing-R&D interfacing early in the process.

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Voorwoord




De vroege fase in de ontwikkeling van nieuwe producten is van cruciaal belang voor het
uiteindelijke succes van een product. Dit is echter geen makkelijke fase, omdat vele
mogelijkheden nog open liggen en keuzes gemaakt moeten worden. Hetzelfde geldt voor het
schrijven van een proefschrift. Het valt niet altijd mee om de juiste onderzoeksvragen te stellen
en je weg te vinden door stapels wetenschappelijke artikelen. Doorzetten tijdens moeilijke
momenten werpt echter wel zijn vruchten af. Het resultaat is een proefschrift waar ik trots op
ben. Vele personen hebben hieraan bijgedragen, maar allereerst wil ik mijn dank en
waardering uitspreken aan mijn promotor, prof. dr. ir. J.C.M. van Trijp. Beste Hans, op de
afgelopen periode kijk ik met veel plezier terug. Je inspirerende en constructieve manier van
begeleiden hebben me enthousiast gemaakt voor het wetenschappelijk onderzoek. Ik heb veel
van je geleerd en hoop in de toekomst met je te kunnen blijven samenwerken.

Een proefschrift over consumentenonderzoek in productontwikkeling vereist integratie van
marketing en R&D. Mijn co-promotor dr. ir. P.A. Luning zorgde voor de levensmiddelen-
technologische kijk op mijn onderzoek. Beste Pieternel, ik wil je hartelijk danken voor je
begeleiding. Ik verwacht dat we elkaar zeker nog zullen tegenkomen in ons werk.

Veel collega’s in Wageningen zorgden voor een prettige sfeer en hulp waar nodig. Ivo
(statistische ondersteuning), Frans (bedankt dat je mijn paranimf wilt zijn), Anne, Aad, Eric,
Erica, Erno, John, Joost, Nikos, Paul, Thieu, Ynte, Wim Jongen en alle andere collega’s,
bedankt. Het was gezellig, ook op het Imag met mijn aio-kamergenoten Janneke, Amber,
Timon (ik ben benieuwd naar jullie proefschriften). Ellen, hartelijk dank voor de secretariële
ondersteuning. Liesbeth, ook jou wil ik hiervoor bedanken en natuurlijk voor je luisterend oor.
Graag wil ik de doctoraal studenten Corneel, Suzanne, Judith, Rianne, Petra en Rianne
bedanken. Ook al zijn jullie resultaten niet altijd opgenomen in dit proefschrift, ze hebben wel
degelijk bijgedragen aan het eindresultaat. Ik ben blij dat ik nu als ‘echte’ post-doc door kan
gaan met het EU-project SAFE FOODS samen met prof. dr. L.J. Frewer. Beste Lynn, Filip,
Heleen en de andere post-docs Arnout, Wendy en Judith: ik weet zeker dat we de komende
jaren met veel plezier zullen samenwerken.

De leden van de promotiecommissie, prof. dr. ir. M.A.J.S. van Boekel, prof. dr. K.G. Grunert,
prof. dr. C.M.J. van Woerkum en prof. dr. J.P.L. Schoormans, dank ik voor het lezen en
beoordelen van het manuscript. Unilever Research Vlaardingen ben ik zeer erkentelijk voor de
financiële ondersteuning van het onderzoek.

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Familie en vrienden dank ik voor hun belangstelling. Dit heb ik zeer gewaardeerd. Hierbij
noem ik in het bijzonder oma en Ab, familie van den Berg, familie de Graaf, familie de Groot,
familie van Kleef, familie Uidam, Chantal, Fabiënne, Jeannette, Saskia, Ana en Kristine.
Moin, thanks for being such a valuable friend for life. Gaudi, bedankt voor het prachtige
ontwerp van de omslag.

Graag wil ik oma Bettie, opa Teunis, oma en opa de Graaf bedanken dat ze Rima een fijne tijd
bezorgen als papa en mama aan het werk zijn. Mijn dierbare zussen Lisette en Evelyn zijn
altijd dichtbij. Jullie twee, maar ook Hans en Gerrit zijn steevast bereid om bij te springen in
drukke tijden. Evelyn, ik ben trots dat mijn kleine zusje nu mijn paranimf is! Een speciaal
woord van dank gaat uit naar mijn ouders. Lieve pa en ma, ik kan altijd op jullie rekenen. Of
het nu gaat om een gezonde maaltijd uit eigen tuin of steun in moeilijke tijden; jullie staan altijd
voor me klaar. Er zijn niet genoeg woorden om mijn dankbaarheid hiervoor te beschrijven.

Mijn laatste dankwoord gaat uit naar Mujibor. Muji, jij hebt mij altijd met liefde en adviezen
ondersteund. Ik bewonder je inzicht en daadkracht. Een proefschrift schrijven is een hele klus,
maar samen hebben we ook voor hetere vuren gestaan. In Bangladesh bleek eens te meer
dat we een goed team zijn. Ik draag dit proefschrift daarom op aan jou en Rima.

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Contents




CHAPTER 1 INTRODUCTION 1
1.1
1.2
1.3
1.4

1.5
INTRODUCTION
IMPORTANCE OF NPD
NPD SUCCESS AND FAILURE AT PRODUCT, STRATEGY, AND PROCESS LEVEL
ROLE AND IMPORTANCE OF CONSUMER RESEARCH FOR OPPORTUNITY
IDENTIFICATION IN NPD
AIM AND SCOPE OF THESIS
1
2
3
7
12
CHAPTER 2 CONSUMER RESEARCH IN THE EARLY STAGES OF NEW PRODUCT
DEVELOPMENT: A CRITICAL REVIEW OF METHODS AND TECHNIQUES 15
ABSTRACT
2.1
2.2
2.3
2.4
APPENDIX 1
15
16
18
26
43
47
INTRODUCTION
CATEGORISATION SCHEME
REVIEW OF METHODS AND TECHNIQUES
CONCLUSION AND IMPLICATIONS
CHAPTER 3 CONSUMER-ORIENTED FUNCTIONAL FOOD DEVELOPMENT: HOW WELL
DO FUNCTIONAL DISCIPLINES REFLECT ‘THE VOICE OF THE CONSUMER’? 49
ABSTRACT
3.1
3.2
3.3
3.4
49
50
52
56
61
INTRODUCTION
STUDY DESIGN
RESULTS
CONCLUSION AND DISCUSSION
CHAPTER 4 FUNCTIONAL FOODS: HEALTH CLAIM-FOOD PRODUCT COMPATIBILITY
AND THE IMPACT OF HEALTH CLAIM FRAMING ON CONSUMER EVALUATION 63
ABSTRACT
4.1
4.2
4.3
4.4
63
64
65
71
80
INTRODUCTION
STUDY 1: HEALTH CLAIM-FOOD PRODUCT COMPATIBILITY
STUDY 2: THE IMPACT OF HEALTH CLAIM FRAMING ON CONSUMER EVALUATION
GENERAL DISCUSSION AND CONCLUSION

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CHAPTER 5 RECONCILING THROUGH PREFERENCES OR PERCEPTIONS: INTERNAL
VERSUS EXTERNAL PREFERENCE ANALYSIS 83
ABSTRACT
5.1
5.2
5.3
5.4
5.5
APPENDIX 1
83
84
85
93
97
101
104
INTRODUCTION
THEORETICAL BACKGROUND AND HYPOTHESES
METHODOLOGY
RESULTS
DISCUSSION AND FUTURE RESEARCH
CHAPTER 6 INNOVATION TEMPLATES IN NEW PRODUCT DEVELOPMENT 107
ABSTRACT
6.1
6.2
6.3
6.4
6.5
107
108
110
114
116
120
INTRODUCTION
THEORETICAL BACKGROUND AND HYPOTHESES
METHODOLOGY
RESULTS
CONCLUSIONS AND DISCUSSION
CHAPTER 7 GENERAL DISCUSSION 123
7.1
7.2
SUMMARY AND CONCLUSIONS
RESEARCH LIMITATIONS AND ISSUES FOR FUTURE RESEARCH
123
127
REFERENCES 131
SAMENVATTING (SUMMARY)

CURRICULUM VITAE

TRAINING AND SUPERVISION PLAN 165
157
163

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1
Chapter 1

Introduction




1.1

Companies must develop new products to grow and stay competitive, but innovation is risky
and costly. A great majority of new products never makes it to the market and those new
products that enter the market place face very high failure rates. Exact figures are hard to find
and vary depending on the type of market (industrial versus consumer) and product (high tech
versus fast moving consumer goods). Moreover, different criteria for the definition of success
and failure make it complicated to compare. However, failure rates have remained high over
the previous decades, averaging 40% (Griffin, 1997). According to Crawford (1987), the
average failure rate is about 35%. Later, Cooper (1993), a leading researcher in the field of
new product development (NPD), estimates a failure rate in the order of 25-45%. A more
recent study of ACNielsen (2000) showed that only one-third of all fast moving consumer
goods (FMCG) introduced in 1998 in Dutch supermarkets can be considered successful. In
this study success was defined as having a level of weighted distribution in supermarkets of at
least 50% after one year.
Since the 1960s it became apparent that the high failure rates of new products justified
research to examine the reasons for success and failure. Prior to the 1960s the development
of new products was considered a technological linear process; new technologies and a
proactive research and development (R&D) effort were believed to drive the success of
products that were created (Poolton and Barclay, 1998). Later on it became clear that more
factors played a role. The first studies on NPD performance showed that the market place
played a major role in stimulating the need for new and improved products. Since the
pioneering studies of Booz, Allen and Hamilton (1968), the success and failure of new
products has been studied intensively. Much has been written about the most appropriate
NPD practices, which can lead to product marketplace success. Success depends among
other factors on the degree to which the new product successfully addresses identified
consumer needs and at the same time exceeds competitive products. Unfortunately, although
past research on NPD performance has shown that even the slightest improvements in an
organisation’s NPD process could yield significant savings (Montoya-Weiss and O’Driscoll,
2000), bringing successful new products to the market is still a major problem for many
companies. Despite increasing attention to NPD, the new product success rate has improved
Introduction

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2
minimally (Wind and Mahajan, 1997). Cooper (1999) states: ‘Recent studies reveal that the art
of product development has not improved all that much- that the voice of the customer is still
missing, that solid up-front homework is not done, that many products enter the development
phase lacking clear definition, and so on.’
The key learning emerging from NPD performance analysis is that success is primarily
determined by a unique and superior product and that the achievement of that is primarily
driven by the effective marketing-R&D interfacing at the very early stages of the NPD process
(opportunity identification). Hence, the paradox here is that while failure reasons (at strategy,
process and product level) are quite well understood and documented, still a high proportion of
new products fails. One reason for this may be that factors of success and failure have not
been translated into meaningful guides for action. Consequently, companies still have
problems with effectively and efficiently implementing the factors of success into NPD practice.
Consumer research at the earliest stages of NPD that helps bridge marketing and R&D
functions is crucial in this process. Miller and Swaddling (2002) argue that the shortcomings in
the current state of NPD practice can be directly or indirectly tied with consumer research (or
the lack thereof) done in conjunction with NPD. As this appears a major bottle neck, this thesis
aims at developing and illustrating consumer research methods at the marketing-R&D
interface.
The structure of this chapter is as follows. We begin with underlining the importance of
NPD for the continued growth and health of companies. Next, literature concerning success
and failure in new product development is reviewed. After that, we discuss the role and
importance of consumer research in the NPD process, both at the early stages (consumer
research for inspiration and focus) and at the later stages (consumer research for verification).
Specifically, we consider the need for consumer research in the early stages and then explore
in detail the criteria for effective strategic consumer research. Finally, this chapter ends with
the definition of the aim, focus and outline of this dissertation.


1.2 Importance of NPD

New products that deliver added consumer value contribute significantly to the success of
companies. NPD is generally recognised as the basis for profitability and growth of most
companies. Additionally, innovativeness of companies has a positive impact on economic
growth (Porter, 1990). Eliashberg, Lilien and Rao (1997) report a survey among 154 senior
marketing officers of US corporations. 61% of the respondents expect that 30% or more of
their sales will come from new products within the next 3-5 years. This finding is consistent
with the survey of 700 firms (60% industrial, 20% consumer durables, and 20% consumer
nondurables) of Booz, Allen and Hamilton (1982) who found that over a five-year period new
products accounted for 28% of these companies’ growth. Hultink and Robben (1995) reported
that new products introduced in the last five years generated 41% of company’s sales and
39% of company’s profits. Besides these benefits, NPD offers other benefits like the positive
impact on company image, the opening up of new markets and the provision of a platform fur
further new products (Storey and Easingwood, 1999).

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3
The need to develop new products is increasingly felt in light of turbulence in the
environment. The causes of such turbulence are numerous and interdependent and include:
• expanding competition (more companies competing for the same market)
• increasingly demanding and knowledgeable consumers whose needs, expectations and
taste rapidly change over time (Dougherty, 1990)
• rapidly changing developments in science and technology, for example biotechnology,
information and communication technology and knowledge about the food-health relation
(Capon and Glazer, 1987), and
• globalisation of businesses, including increased international competition (Wind and
Mahajan, 1997).
All these discontinuities result in shorter and less predictable product life cycles and create
new markets to deal with, which in turn lead to an increasing pressure to develop and launch
new products.


1.3 NPD success and failure at product, strategy, and process level

The importance of NPD for continued survival and competitive success, coupled with the high-
risk activity that it is, makes it not surprising that the NPD process has received considerable
attention in literature. New product performance has been shown to be a complex construct
and many and diverse measures of success are used in NPD performance studies (Griffin and
Page, 1996). The reasons for success and failure of NPD are heavily researched from several
points of view. In the early years of new product performance analysis, innovations were
examined from the point of view of either the factors associated with success, or those factors
associated with failure. It was not until the 1970s that studies compared successful with
unsuccessful innovations (Poolton and Barclay, 1998). Generally, a distinction can be made
between ‘generalist’ and ‘specialist’ studies. Generalist studies are typically explorative in that
they include a broad range of possible determinants of new product success and aim at
identifying the most important ones (Gruner and Homburg, 2000). Well-known generalist
studies include the work of Robert Cooper and his colleagues, which is considered to be
pioneering in its extensive analysis of new product performance. Specialist studies focus on an
in-depth analysis of a limited range of determinants.
Despite methodological differences there is now general agreement of the common
characteristics of successful innovation. The determinants of success and failure of new
product are typically situated at two different organisational levels: (1) the project (product)
level, i.e. the way in which individual products are developed, and (2) the strategic level,
relating to the way in which companies approach the development of new products in general.
The strategic issues operate at the organisational level. They are not particular to one project,
but instead exert an influence over every project (Hart, 1995; John and Snelson, 1988).
Henard and Szymanski (2001) conducted a meta-analysis of the new product performance
literature. Based on existing frameworks found in literature (e.g. Montoya-Weiss and
Calantone, 1994), they developed a similar taxonomy of antecedents of new product