Using the Opportunity Score to Choose Winning Concepts

Despite consumers concentrating their household purchasing on a limited array of products, companies continue to launch new products as a way to increase sales and market share. Last year, 34,000 new products were launched in the United States and Canada. Along the bumpy road to new product introduction, marketers face difficult challenges, from choosing which product formulation is best to deciding which package design will be most effective. Still, the most critical and fundamental decision is usually made early in the innovation process: which idea should we pursue?

The Opportunity Score is Rooted in Volumetric Forecasting

The Consumer Products Division of Ipsos-Insight created the concept of the opportunity score based on its expertise in online concept screening and forecasting. The opportunity score relates directly to the year-one trial rate. It can be used to help clients more accurately and easily identify high potential concepts early in the screening process (i.e., during an Ipsos-Insight Concept/Tester.online study). The opportunity score integrates four key measures directly relating to the prediction of trial into one index. The use of an integrated measurement approach makes it less likely to overstate (or understate) the importance of a single measure and can guide decision-making about which concepts to move forward with among a set of high scoring concepts. The four measures are:

• purchase interest
• anticipated purchase frequency
• uniqueness
• value

Making More Informed Decisions

Concept screening is widely used to select ideas for the next stage of development and the resulting purchase interest (likelihood to buy) score is usually the one measure on which these decisions are made. The opportunity score, one score utilizing four key measures, is more predictive than purchase interest scores alone.

Consider the situation in which three concepts being considered for further development undergo traditional concept screening. As we can see in the chart below, concept B would be selected as the top performer when purchase interest alone is considered. However, if the decision were based on the opportunity score (which includes the four key measures) then concept C, with the highest opportunity score of 130, would be selected.

If we assume that marketing spending and category dynamics for these products are the same, then we can interpret the estimated year-one trial rate for concept C to be about 9% higher than the trial rate for concept B, and approximately 11% higher than concept A.

In many companies, the innovation process generates a number of good, potentially viable, new product ideas, which makes deciding which one to proceed with even more difficult. The following example shows that using an opportunity score enables you to focus on the best of the best ideas. For example, suppose that a consumer packaged goods manufacturer tests 60 related concepts and 14 of them receive purchase interest scores that meet the action standard. The opportunity score can be used to differentiate the 14 concepts in terms of highest year-one trial potential. As indicated in the following graph, when the opportunity score is incorporated into the analysis, the choice of which concept to pursue for further development can be narrowed down to five choices.

Integrating the Opportunity Score

Concept testing databases typically include norms for purchase interest, uniqueness, and value. All of this information is captured in the Ipsos-Insight Online Concept Testing Database. We have gone a step further by integrating opportunity scores into our database. Using opportunity scores as benchmarks results in a very refined and systematic approach to concept screening evaluations at the category and subcategory levels.

In the example below, concepts generating an opportunity score above 110 proceed to the next stage of development. Those scoring between 90 and 110 need to be reworked. Concepts below 90 should not be further pursued at this time. (These ranges are typical but can be adjusted to specific client standards.)

The opportunity score also can be employed for competitive benchmarking. The table below shows concepts Q, Y, and Z compared to a competitive benchmark. Again, if marketing spending and category dynamics for all products were the same, we would estimate the year-one trial rate for concept Q to be nearly 6% higher than the competitive benchmark. Concepts Y and Z are 4% and 15% below the competitive benchmark, respectively. Using the opportunity score database, any concept scoring below the eightieth percentile would generate a trial level at least 10% lower than the competitive benchmark. Concepts scoring below the twentieth percentile would have a trial level at least 27% lower than the competitive benchmark.

Opportunity Scores for Better Decisions

The opportunity score is a validated and predictive analytical tool to complement concept screening research. By integrating multiple measures into a single summary measure, the opportunity score can be used to more accurately and easily identify high potential concepts early in the screening process. The opportunity score, because it relates directly to the year-one trial rate, helps marketers make confident decisions about which concepts to move to the next stage of product development. The opportunity score is a useful complement to any Concept/Tester.online study conducted with Ipsos-Insight.