New NPD Approach Puts Dollar Value on Product Features

Retail information provider The NPD Group has introduced an approach for identifying the value in dollars of individual product features, to help manufacturers and retailers make more informed product development and marketing decisions.

The new approach taps NPD's data assets, including point-of-sale (POS) information from more than 700 retailers nationwide. This store-level data shows what consumers purchased, the price they paid for those products, and a variety of other attributes - with which information NPD says it can determine the value in dollars of the individual features of those products.

Manufacturers can use the service to assess how much people are willing to pay for specific features; which features to focus on when designing or enhancing products; and how to price product upgrades. Retailers will be able to identify 'must have' product features they need to carry, in order to support category-level decisions on how to price and assort products within stores. All subscribers will be able to test hypotheses using an interactive simulation system that NPD updates as new features enter the market.

George Terhanian (pictured), the company's President of Solutions, comments: 'People who participate in research are not always great at rating or rank ordering product features, let alone predicting their own future behavior. Within an in-depth interview or survey, for instance, someone may say that the brand of a laptop is only a moderately important consideration when they think about buying a computer. At checkout, it may turn out that brand trumps all other features'.

Web site: www.npd.com .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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