This blog post was written by our guest blogger Mark Dengler, President and Owner of Research & Marketing Strategies, Inc. (RMS), a market research consulting firm located in Upstate NY. RMS is currently celebrating its 10th year in business.
Let’s say you’re developing a new product, service, location or program. Before you delve too deeply, you want to determine whether it is a viable investment for your organization. This is when you should conduct a Feasibility Study. This market research enables a company to gather information and objective analysis to assess the potential success of a new investment. In fact, using a feasibility study can save companies in the long run, especially recognizing that investment in development and the cost of design modifications increase rapidly after the feasibility stage. Here is a theoretical case study we did on using feasibility studies and market research in product development: Market Research ROI.
Here are questions to consider during the feasibility stage of your new product, service, location or program:
- Determine the product (or service) demand – Does a market exist for your product and will customers buy it? Can the product actually be made and, if so, how large is the opportunity? What technologies are required and are those technical capabilities in-house? Do opportunities exist to license or acquire what is needed?
- Analyze the competitive environment – What are the product’s competitive strengths? What is the competition based on (price, performance, innovative features, service, reliability, etc.) and is this competitive basis sustainable? What is the expected competitive response? Is the basis of competition in line with your overall strategy?
- Verify the product (or service) is worth investment (ROI) – What are the realistic estimates of sales and revenue? Can market share indeed be obtained? Are product costs manageable? Are development costs affordable and acceptable? Is the product going to be profitable? Is there an adequate Return On Investment (ROI)? Are the risks understood and are they acceptable? Is this product in line with your overall company strategy?
Answer all of these questions with a market research feasibility study and learn the projected demand for your investment and eliminate risk. The cost of a market research feasibility study is considered minimal when you begin thinking about how much it would cost your organization if the product, service, location or program failed. Are you interested in using feasibility research for your organization? Contact our Business Development Director Sandy Baker at SandyB@RMSresults.com or call her at 315-635-9802.