Ipsos InnoQuest_Passport to Product Testing

8/13/2019 Ipsos InnoQuest_Passport to Product Testing

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PASSPORT TO PRODUCT TESTING:Connecting with Consumers in Emerging Markets


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PASSPORT TO PRODUCT TESTING: YOUR ITINERARY

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Product Testing in BRICS: Avoid Delays

Meet Your Local Ipsos InnoQuest Guides

Travel Tips for Testing Products in Emerging Markets

Destination: Brazil

Destination: Russia

Destination: India Destination: China

Destination: South Africa

Planning Your Next Excursion

About Ipsos InnoQuest

Click on any of the topics above to travel directly toyour desired destination.


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PRODUCT TESTING IN BRICS: AVOID DELAYS

Given the critical role of emergingmarkets in growth strategies and theneed for speed to market there is noroom for missteps when it comes tolocal product testing.

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However, marketers who embark on produc t testing in emerging marketsoften find themselves in unchartered territory with unforeseen obstacles.

To help ensure smooth execution and high-quality results whenconducting product tests in emerging markets, we asked our Ipsos

InnoQuest experts in Brazil, Russia, India, China and South Africa (BRICS)

for their advice on navigating product testing in their respective countries.

Lets begin by meeting our local guides!


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MEET YOUR LOCAL IPSOS INNOQUEST GUIDES

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Carla MahfuzDirector, Brazil

Anton NegrebetskyHead of Ipsos InnoQuest,Russia

Amit AdarkarManaging Director,India

Vidya SenExecutive Director,India

Kevin ZhouManaging Director,China

Nick CoatesDirector of Ipsos Marketing,South Africa and Sub-SaharanAfrica


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TRAVEL TIPS FOR TESTING PRODUCTS IN EMERGING MARKETS

Interviews with our experts in the BRICScountries revealed common challenges thatmarketers face when conducting producttesting in emerging markets.

These challenges relate to the heterogeneity that exists in emerging countries,cultural nuances which are hard to recognize without having lived in the countr y

and physical obstacles that might not become apparent until fieldwork begins.

In the pages that follow, our experts reveal seven challenges that must be overcome

when conducting product testing in emerging markets along with their advice

on how to make your product test a success. From executional excellence to reliabilityof results, our experts will help you navigate a successful product testing journey.

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#1: DONT ASSUME CONSUMERS WILL USE THE PRODUCTIN THE SAME WAY OR USE IT AT ALL

Consumers in the same country mayhave extremely different lifestyles.How they live and what they haveaccess to will impact how and if they will use the test product.

Lets first take a look at China. In Tier 1 cities (which represent the most developed areasand include Shanghai, Beijing and Guangzhou) all households have running water and

most respondents use a showerhead. In contrast, households in Tier 3 cities (which are

less developed) may not have a well-equipped bathroom and may use a bucket insteadof a showerhead. If you are testing a new shampoo in China, the ratings for the attribute

easy to rinse will be very different in a Tier 1 city vs. a Tier 3 city.

Similar product usage challenges can arise in South Africa as well. According to Nick

Coates, our local guide in South Africa, Although considered a newly industrialized

country, there are still large segments of the population that do not have regular access

to basic amenities such as electricity or running water.

In Brazil and India, consumers in the emerging middle class have lifestyles that affordthem premium and luxury products like expensive brands of alcohol. Consumers in the

middle class who have experience with these categories will evaluate them differently

from consumers trying them for the first time.

Travel Tip:When designing a product test, it is important to understand how the consumers

lifestyle will impact product usage and, consequently, evaluation. In a given country, are

all the people you intend to sample able to use the produc t in the way you intended?How do people normally interact with the type of product you are testing, if they interact

with it at all? How does this vary throughout the country? These are the questions you

must answer upfront, before deciding who and where to interview. When in doubt,include survey questions not only about product application and consumption but also

about how the product will be served, shared, stored and disposed of.

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#2: MITIGATE MIXED REACTIONSTO FOOD AND BEVERAGES

Taste preferences can vary significantlywithin an emerging market whichcan lead to different levels of productacceptance from one region of acountry to another.

Emerging countries are often large in size and population, giving way to dif ferences in foodsources, customs, and ultimately taste preferences.

In China there are eight major schools of cuisine from different regions which translate intodifferent taste preferences (e.g., in Shanghai respondents will prefer sweeter food while in

Chengdu respondents will be very accepting of spicy food). In Russia, differences in taste

preferences often stem from geographic specificities: fish, fruits, and vegetables are popularin the South while meat dominates the diet in the Urals and Siberia to provide warmth.

And, In Brazil, flavor preferences will be influenced by the regional fruits with which

respondents are familiar.

In India, the heterogeneity of taste preferences is remarkable as well. Vidya Sen, one of our

local guides in India, explains, When conducting a product test in India, test centers must bechosen judiciously. For example, in certain parts of the country, oats or porridge is consumed

in the sweet form. Choosing centers from these regions for testing savory oats would result in

poor ratings for the test produc t.

Travel Tip:Our experts advise: The design of the product test will ultimately be dictated by the product

launch objectives in the country. Marketers first need to decide if they are going to develop a

single product formulation for the country or customize the formulation by region. If a singleproduct is intended, different action standards per region should be set and the product test

should be concentrated in regions where the product has a realistic chance to succeed.

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#3: DONT GET LEFT OUT IN THE COLD OR TRAPPED IN THE HEAT

Climate adds complexity and willhave a significant impact on producttransport, storage and evaluation.

Many emerging markets are vast in size and have multiple climate zones most notablyRussia, which has every climate zone except tropical.

According to Anton Negrebetsky, our local guide in Russia, Climate can impact consumerperceptions of a product and also actual product per formance. In Russia, a cosmetic

manufacturer had to make significant changes to its mascara formula to adapt it to Siberias

frigid temperatures without these changes the mascara would have frozen on theconsumers eye lashes.

In China, a moisturizer that is perceived by consumers to be light in Beijing (which has a

continental climate) could be perceived as too heavy in Guangzhou (which has a tropicalclimate). Similarly in Brazil, the texture of a moisturizer will be evaluated differently in hot,

humid regions close to the Equator versus drier regions further away.

Seasonality will affect the timing of a product test as well. In India, some areas of the country

like Chennai are hot all year round while other areas like Delhi have extreme variations intemperature from summer to winter so while a carbonated soft drink could be tested in

February in Chennai, it would not be the right month to test a cold beverage in Delhi.

Travel Tip:Extreme weather conditions can interfere with test produc ts getting to their destinations

so build in extra time for delivery. For perishable and non-shelf stable products, safeguardagainst spoiling with appropriate packing as climate-controlled facilities may not be

available in emerging markets and power outages can be common. Lastly, give forethoughton how the climate will impact product formulation, usage and the consumer experience.

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#4: WHEN HOMEMADE PREVAILS OVER PROCESSED,PREPARE YOURSELF AND THE CONSUMER

Consumers may be more accustomedto homemade solutions thanprocessed and branded products.Consequently, respondents mayevaluate the same product differentlybased on what they currently use.

Consumers in some developing countries are more likely to use homemade solutions thanprocessed and branded products. For example, in India the penetration for most branded

products is low (with the exception of a few mass categories like shampoo and bar soap).

Similarly, consumers may be in the habit of customizing the products they do buy, using andconsuming them in their own way.

Furthermore, according to Amit Adarkar, one of our local guides in India, Given thenascent nature of many product categories in emerging markets, respondents may not

know exactly how to use the product. Case in point: If the test product is a fabric

conditioner the respondent may need to be informed of the right stage of the wash cycle

to use it in or the test results will not be reliable.

Safety concern is another issue that arises with processed foods. According to Kevin Zhou,our local guide in China, This is especially true in China, where concerns over food safet y

can affect willingness to participate in the product test.

The bottom line is that produc t tests need to take into account that respondents may have

little experience with processed product s and their level of experience will impact

product evaluations.

Travel Tip:Because consumers product experience benchmarks are diverse, matching panelsbecomes critical for monadic tests. For food products, including ethnicity (e.g., the part of

India that the consumer comes from) as a panel matching variable is important. Marketersshould also be aware that consumers might be wary of processed foods. Professional

credentials are important in overcoming this barrier.

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#5: WHEN FACING HURDLES WITH FACE-TO-FACE,CONTEMPLATE MOBILE

Product testing in emerging markets ismainly conducted face-to-face butnot without challenges. Mobile notonline is a new alternative.

Face-to-face interviews for product evaluation is the usual data collection methodologyin emerging markets. For most countries, phone and online will not work given the low

levels of household penetration and limited bandwidths.

Still, face-to-face interviewing can be tricky. In the large cities of Brazil, India and China

many citizens live in gated communities containing thousands of condominiums. It is

difficult to gain access to respondents residing in these communities. Conversely, outsideof these gated communities, personal security becomes a concern for the face-to-face

interviewer.

According to Caral Mahfuz, our local guide in Brazil, Another issue that arises withface-to-face interviews conducted in respondents homes is interviewer bias.

As interviewers are considered guests in the home, respondents may consider it impoliteto give negative responses.

Travel Tip:Mobile data collection is becoming an attrac tive alternative to face-to-face, offering

faster and easier access to the growing number of consumers in emerging markets whoown a mobile phone. Moreover, mobile enables marketers to capture consumer

responses at the moment of use, providing insights into the context in which products

are being used and the key factors driving satisfaction with the products on differentusage occasions. In addition, mobile offers the benefit of alleviating interviewer bias, as

mobile surveys are answered autonomously.

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#6: TRADITIONAL OR MODERN TRADE?DETERMINE DISTRIBUTION AND REPLICATE REALITY

Distribution channels can range fromoutdoor markets to Walmart youneed to know where your product willbe sold and mirror those conditionsduring product testing.

When conducting a product test in an emerging market, you need to have a good senseof where you will have distribution for your product at time of launch. In India and China,

there will be a mix of modern retail outlets and traditional trade. In South Africa, there

remains a strong traditional trade where informal traders and street vendors break-upbulk product into single units. However, this trend seems to be shifting as modern trade

has mushroomed in South Africa as demonstrated by Walmart recently entering the

market through the acquisition of a major local retailer.

Even in Brazil and Russia, where the distribution channels are quite similar across

regions, there will be deviations in the contribution of each channel, with open markets

accounting for larger volume in small cities and modern trade more pronounced inlarge cities.

Travel Tip:Product tests should be designed to replicate the reality of the marketplace. The first stepis to determine where the product will be sold: A mix of traditional and modern trade?

Modern trade only? The produc t test should be implemented in the key geographies

where you will have distribution. If distribution is to be staggered, the produc t test needsto cover the markets where the produc t will be initially available. Also, dont assume that

the retail trade will have cold storage facilities. So, for categories like chocolate, rather

than carry out product tests in air-conditioned facilities, it is wiser to replicate reality andtest the product under normal, in-market conditions.

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#7: EXPECT AND DEFLECT COURTESY RESPONSES

The use of rating scales in manyemerging markets varies significantlyfrom how they are used in developedmarkets.

Consumers in Brazil, India, China and South Africa tend to exhibit substantial courtesybias in their product test ratings, with most products attaining very high top two box

ratings. Most emerging markets use the typical 5 and 7 point scale as a 3 or 4 point

scale respectively, given that 95% of the data usually sits in the top three or four boxes.This is in sharp contrast to developed markets, where responses tend to be spread

across all scale points.

Travel Tip:For product tests in emerging markets, anticipate your analysis ahead of time and

include a control cell to act as a benchmark against which to compare test productresults. Be aware that top two box scores will rarely provide differentiation;

therefore, focus on top box scores. Finally, avoid comparing absolute scores betweencountries, especially between emerging and developed markets; instead use ndices

as points of comparison.

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TAKE A TOUR OF THE BRICS COUNTRIES


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DESTINATION: BRAZIL

TRAVEL FORUM:

In Brazil we cannot give money as an incentivesince it is forbidden by law.

Usually, people are really enthusiastic toanswer a survey and they consider the

opportunity to receive a test product as theirincentive to take the survey.

Asking people for their opinions makes themfeel really important!

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Carla MahfuzDirector, Brazil

Your Local Guide:


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DESTINATION: BRAZIL

Lifestyles

We need to differentiate the South (So Paulo, Rio) and the Northeast (Recife, Fortalezaand Salvador). In the South, we see a huge number of consumers emerging from the

lower to the middle class. This has brought massive change to the behavior and

purchasing power of consumers, who now have access to everything from premiummarketed products to private education and health assistance. In the Northeast, on the

other hand, the social economic levels remain mostly unchanged.

Tastes

There are many differences in flavors, product s and food habits across Brazil. Again,comparing the South and Northeast, we see product lines offering different flavors toaccommodate differences in these regions. The ice cream market, for example,

incorporates regional fruits, bringing the people of the Northeast the feeling that the ice

cream is made especially for me.

Climate

The regions closer to the Equator line are extremely hot and humid, so the texture ofmoisturizers, for example, must be lighter as well as the intensity of perfume on personal

care products.

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Homemade vs. Processed

Here, Brazil differs from other emerging markets. Branded and processed foods are thenorm, and thus do not impact product evaluations.

Reaching Consumers

CATI interviews can be used to administer the interview, although land line penetration

is about 59%. While online surveys look equally attractive (~with 56% penetration),

slow connection speeds can result in lower response rates. Mobile phone penetrationis quite high: 82% overall with moderate to high levels across socio-economic classes.

We recently conducted a product test at a venue where the consumers tried a snack andhad to answer via mobile the next time they felt hungry. Response rate was 100%!

Trade

In the South, there is access to modern trade. In the Northeast, most of the people buytheir products in the traditional trade, and it is common to buy only the quantity they

need for the day or week so they have a lower out-of-pocket spend.

Survey Ratings

Brazil is known widely as a country with a high courtesy bias. In most cases, this is true.

However, when a product really has a difference or if it is really worse than a benchmark,

Brazilian consumers will not give higher ratings for it.


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DESTINATION: RUSSIA

TRAVEL FORUM:

Consumer attitudes in Moscow can be differentfrom and sometimes contradictory to attitudesin other regional cities.

For product evaluation, it can be even more

pronounced as each region has its owntraditions of consumption.

When testing products that will be launched atthe national level, it is highly recommended toinclude several cities in the sample to measuregeographical differences.

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Anton NegrebetskyHead of Ipsos InnoQuest,Russia

Your Local Guide:


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DESTINATION: RUSSIA

Lifestyles

Consumers varied lifestyles impact how they consume products. For example, in thecosmetics category, makeup plays a greater role in the lives of women in the North than

in the South (e.g., in Saint-Petersburg). Therefore, it is important to unders tand the

lifestyles that exist in the areas where you plan to test and launch the produc t.

Tastes

Taste saturation strong, rich, intense flavors is very important to Russian consumers.Products that do not provide strong sensations will not likely perform well in a product

test. Texture preferences must also be considered. For example, in the oatmeal categorywe have learned that oat size really matters to Russian consumers. They like large, wholeoats and not small, crushed oat pieces upon learning this, an oatmeal manufacturer

changed oat suppliers and achieved higher appreciation among the target audience.

Climate

Severe weather conditions can impact consumer perceptions of a p roduct and also actual

product performance. Climate, including freezing temperatures, also needs to be factoredin when deciding how the product will be transported and stored.

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Consumers accustomed to homemade dishes may shy away from processed versionsintroduced to the market. For example, soup is a highly traditional dish in Russia. It is

usually thick and filling and contains many ingredients (e.g., meat, lots of vegetables).

Although several international brands have been launched in the ready-to-eat soupcategory, consumers remain loyal to traditional, homemade soups.

Reaching Consumers

Product testing studies are done primarily through face-to-face interviews.

Trade

Distribution channels are similar across regions. However, in big cities especiallyMoscow and Saint-Petersburg the share of modern trade is higher than in the rest of

the country.

Survey Ratings

Russian respondents do not give ex treme scores on rating scales. Their ratings are

between those in Brazil, India and developed markets. To obtain better differentiation a7 point or 9 point scale is usually used.


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DESTINATION: INDIA

TRAVEL FORUM:

Placing products that could have a hiddennon-vegetarian component (such as animal gelatinin jelly sweets) needs to be handled with care soproducts that are not universally acceptable donot get placed with the wrong set of consumers.

Explicitly label products and provide clearinstructions to field staff on this issue to avoidsparking off a sensitive situation.

When implementing in-home tests where thequantity of product used is being measuredat the recall stage, it is important to check if theproduct was also used by other members of

the household. It is quite likely that the respondentwill share the test product with other householdmembers. Products should be placed in quantitiessufficient for the entire family to consume.

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Amit AdarkarManaging Director, India

Vidya SenExecutive Director, India

Your Local Guides:


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DESTINATION: INDIA

Lifestyles

Different socio-economic levels result in consumers having different product experienceswhich will impact evaluation. For example, when it comes to testing evolved categories

such as fine fragrances in India, consumers with ver y little exposure to these categories

are probably not in a position to appreciate the finer nuances of the produc t.

Tastes

India is a heterogeneous country with substantial differences in food habits and tastepalates. For example, flour used to make rotis is preferred in the coarse form in the

North and in a rather fine texture in the South. Nuances like these must be recognized at

the category level and incorporated in the test design.

Climate

Seasonality needs to be considered when deciding the timing of a product test as thereare extreme variations in summer and winter temperatures.

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Consumers are in the habit of preparing food from scratch. For example, consumersmake their own tea by boiling tea grains in water and adding milk, sugar and other

ingredients at various stages. It is not surprising that tea is evaluated at multiple levels

(grain appearance, grain size, grain consistency, color release when boiling starts, etc.)and consumers have their own system of linking various sensorials to the likely quality

of the end cup. We always tell our clients that food products are consumed visually aswell as olfactorily at each and every stage of food preparation.

Reaching Consumers

Almost all product testing in India is carried out through face-to-face interviewing.Online penetration in India is too low yet to take on produc t testing for most products.

However, it is getting tougher to carry out produc t research for premium products

because of denied access to gated communities. Mobile is an alternative methodologyfor certain products.

Trade

India leans toward traditional trade rather than modern retail outlets; therefore, new

products usually have staggered launches across different geographies making it

important to ensure that the markets where the produc t is distributed initially arecovered in the product test.

Survey Ratings

India exhibits substantial courtesy bias. It is rare to get top two box ratings below 80%;top box is a much better discriminator.


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DESTINATION: CHINA

TRAVEL FORUM:

China is never ONE market! When designinga study in China, its meaningful to splitthe sample by city-tier and region and often,we need to consider these two factors atthe same time.

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Kevin ZhouManaging Director,China

Your Local Guide:


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DESTINATION: CHINA

Lifestyles

Even among Tier 1 cities one must take into account regional preferences and stageof development. For example, the northern city of Beijing is more traditional and interest

in basic categories is high. Here, you can expec t to see discrimination in laundry testing.

On the other hand, in the more commercially-minded city of Shanghai there is littleinterest in laundry, but indulgent categories like ice cream are important.

Tastes

There are eight major schools of cuisine from different regions which translate into

different taste preferences. Clearly, when testing a food or beverage product in China,

you should expect different levels of product acceptance. Companies like McDonaldsrecognize this and develop local flavors and of ferings to attract consumers.

Climate

There are four distinct seasons and this affects product evaluation and frequency of use:

for example, when testing a soap produc t in winter, one must realize that skin is dry,

water is cold, and washing is less frequent.

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When conducting product tests, especially blind product tests, fears about food safetymust be addressed and alleviated by of fering proof of professional credentials.

Reaching Consumers

In Tier 1 and 2 cities, Internet and smart phone penetration may be higher than in

developed markets, but beyond that frontier Internet penetration can be very low.

Trade

Although China has a mix of traditional trade and modern trade, its distribution structurevaries significantly by city tiers. For instance, in large cities, modern trade, especially

hypermarkets, accounts for a large share of distribution. In low-tier cities, traditionaltrade or wholesale markets still dominate.

Survey Ratings

Similar to other developing markets, Chinas consumers have courtesy bias. Top two box

ratings are often above 80%. Top box is a much bet ter discriminator. On the other hand,

due to the different levels of economic development and consumer sophistication, theratings always follow a geographic pat tern. For instance, ratings from low-tier cities or

northern/western areas are usually lower than those from high-tier cities or eastern/

southern areas.


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DESTINATION: SOUTH AFRICA

TRAVEL FORUM:

Consumers often purchase products forcommunal use, so there is always thepossibility that more than one person willuse the product in a home usage test.

Talking to consumers in addition to therespondent you placed the product withcan reveal interesting insights.

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Nick CoatesDirector of Ipsos Marketing,South Africa andSub-Saharan Africa

Your Local Guide:


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DESTINATION: SOUTH AFRICA

Lifestyles

In South Africa, the socio-economic effects of Apartheid and more recently high levels ofunemployment have resulted in a society with g ross economic inequality. Despite a

growing middle class, the Gini coefficient used as a measure of income or consumption

distribution amongst individuals or households indicates that South Africa is the mostunequal society in the world. Differences in income and consumption coupled with the

sheer diversity of the South African rainbow population must be taken into account inthe product test design. When undertaking product testing research, it remains

important to know and understand who your target market is within South Africa.

Tastes

In the case of South Africa, the new middle class retains many of its more traditional

tastes and product preferences. This in turn warrants manufacturers to extend their

product lines in order to align with more traditional needs amongst consumers withrecently increased purchasing power. For example, manufacturers are introducing new

product accompaniments to traditional staple foods.

Climate

South Africa is a country of two climates a Mediterranean climate on the West coast

and a hot, humid, tropical climate on the East coast. In the summer, from Novemberto March, the entire countr y shares the hot, humid, scorching sun. However, in winter,

from June to September, temperatures drop drastically in the northern and western par tsof the country.

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A melting pot of cultures and ethnicities make up the landscape of South Africa.As such, each culture holds their own traditions and homemade dishes in high esteem.

Any processed food that enters the market is judged in relation to its homemade

counterpart. Flavoring and adding spices forms a significant part of South African cookingand culture; therefore, in order to succeed in this market, processed food and fast food

need to incorporate traditional recipes and spices.

Reaching Consumers

Increased access to the Internet is mainly due to growth in smart phone ownership as

opposed to traditional fixed line access. However, total penetration of smart phoneownership across different consumer segments remains relatively low and

unrepresentative in specific target markets.

Trade

In South Africa there still remains a strong traditional trade in the form of informal

traders and street vendors. However, this trend seems to be shifting as modern trade isgrowing and consumer purchasing behavior is shifting as shoppers star t buying in bulk

weekly or monthly due to af fordability and improved proximity of modern trade outlets.

Survey Ratings

South Africa has a high courtesy bias. Most ratings do not go lower than a top two boxfor a 5 point scale and top three box for a 7 point scale. When consumers rate a product

as good it implies that there is room for improvement.


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ABOUT IPSOS INNOQUEST

Ipsos InnoQuest is dedicated tomeeting the innovation andforecasting needs of our clients.

Ipsos InnoQuest helps clients to maximize the ROI of their innovation processes through a unique,

global end-to-end offer and deep expertise across a wide array of sectors. Central to our offer is ourability to provide financial metrics even at ver y early stages and clear direction for maximization

of initiative potential.

We offer simple, intuitive tools built on a consistent philosophy of what drives innovation success, a

comprehensive suite of tools for product research and development of fering solutions throughout

the products lifecycle, and powerful simulation capabilities to help clients reach their financialtargets. From the fuzzy front end to mix optimization, launch and beyond, we help our clients to

maximize their innovation I.Q.

Ipsos InnoQuest is a specialized practice of Ipsos, a global market research company which delivers

insightful expertise across six research specializations: advertising, customer loyalty, marketing,

media, public affairs research, and survey management. With offices in 86 countries, Ipsos has theresources to conduct research wherever in the world our clients do business. In October 2011 Ipsos

completed the acquisition of Synovate. The combination forms the worlds third largest marketresearch company.

In 2012, Ipsos generated global revenues of 1.789 billion euros, Marketing research contributingto 53% of Ipsos revenues.

Visit www.ipsos.comto learn more.

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