In a crowded marketplace, launching a product without solid evidence to back its appeal and pricing can be a costly gamble. Product, proposition, and pricing evaluation are vital elements of market research that help take the guesswork out of go-to-market strategy. By rigorously assessing what you offer, how you position it, and at what price, businesses can ground their decisions in data and greatly improve their chances of success.
Why Thorough Evaluation Is Crucial
Without proper evaluation, even promising ideas can fall flat. Studies indicate that roughly 80% of new product launches fail to meet their objectives – often because companies misjudge the product’s appeal or pitch it wrong. In many cases, the core issue is a lack of product-market fit or a value proposition that doesn’t resonate with customers. Thorough research serves as an early warning system, uncovering these red flags before a full market launch when there’s still time to adjust course.
Pricing is another make-or-break factor. A great product priced poorly can struggle to find buyers or leave revenue on the table. Yet there’s often a perception gap: in one survey, 40% of consumers said price was the most important factor in purchase decisions, while only 20% of retail executives believed the same. Evaluating pricing through market research helps bridge this gap, ensuring companies set prices that align with customer expectations and willingness to pay.
What to Evaluate: Product, Proposition & Pricing
Each of these three pillars addresses a critical question for market success
- Product Evaluation: Is the product meeting a real customer need, and does it perform as expected? Through concept tests, prototypes, or user trials, product evaluation checks that what you’re offering actually solves a problem or delivers value that customers care about. This reduces the risk of launching a product that sounds good on paper but fails to win over buyers in practice.
- Proposition Evaluation: Is the value proposition and messaging clear and compelling to the target audience? This aspect tests whether people get why the product is useful or different. Even a great product can falter if its message doesn’t reach or resonate with its intended customers. By gauging reactions to marketing concepts, ads, or product descriptions, proposition research ensures the way you communicate the product’s benefits hits the mark.
- Pricing Evaluation: Are you pricing the product right, given the market’s expectations and the value it provides? Pricing research (like surveys, price sensitivity analyses, or A/B tests) reveals what customers are willing to pay and how price changes might affect demand. It helps find the sweet spot where the price is attractive to customers while sustaining healthy margins, avoiding the twin perils of pricing too high (and driving customers away) or too low (undercutting the product’s perceived value).
Illustrative Example: Research in Action
Imagine a small consumer brand preparing to launch a new healthy snack. Initially, the team is confident that the product’s organic ingredients and gourmet taste justify a premium price. However, before rolling it out, they conduct thorough market research. Product testing reveals that while consumers love the flavor, many aren’t sure what need the snack fulfills – is it an energy boost for athletes or a guilt-free treat for dieters? This insight points to a blurry proposition. At the same time, a pricing study finds that most target customers balk at the proposed price for a single snack bar. Armed with these findings, the brand tweaks its proposition (emphasizing the snack’s high protein content for fitness-minded buyers) and adjusts the price slightly downward. The result is a successful launch with strong customer uptake – an outcome that might have been very different had they not vetted the product, proposition, and pricing ahead of time.
Organizations often partner with specialized market research firms to carry out these evaluations objectively and thoroughly. For instance, GIIRAC uses a blend of quantitative and qualitative research techniques to help brands gauge product-market fit, refine their value propositions, and identify optimal pricing strategies. By leveraging such expertise, companies can translate complex consumer data into clear action plans, ensuring their product, messaging, and pricing are all poised for market success.
Ultimately, investing in product, proposition, and pricing evaluation is about de-risking decisions and maximizing market resonance. It provides the evidence behind the vision – so that when a product finally hits the market, it truly strikes a chord with consumers and delivers value for both the customer and the business.
