NEW PROGRAM TO BOOST RETAILER CONFIDENCE IN NEW PRODUCTS

DAN ALAIMO

CHICAGO -- New enhancements to Information Resources, Inc.'s BehaviorScan program will give retailers a better knowledge of what new products are going to succeed, said Valerie Skala, vice president, analytic product management and development.

BehaviorScan uses retail outlets -- most of them supermarkets -- and a panel of consumer participants, to conduct in-market testing of new consumer packaged goods items. Consumers show a card when checking out to record their purchase information. But a flaw in the program has been nonparticipating retailers.

Beginning in the middle of next year, IRI will provide the consumer participants with a home-scanning device to use on products bought from retailers that can't, or won't, scan the card, Skala said. However, IRI will continue to have its consumer participants use cards because it is easier for them, she said.

"By expanding the retail outlets that are covered by our household panel, we will provide a more comprehensive analysis of a new product's sales potential," she said. "By capturing more of a household's total package goods purchases, we should be able to evaluate the success or failure, as well as the long-term volume potential of the new item more quickly and more accurately."

The benefit to the manufacturer is a clearer picture of how their potential new entries will perform, she said. "It is a risk-reduction tool. It identifies failures before you spend $50 million on a national launch."

But there is also risk in new items for retailers, and knowing which ones have undergone this kind of testing will help them avoid failures while boosting sales. "When a retailer sees a new product sales presentation from a manufacturer, and the sales material says this product qualifies for a national rollout following a BehaviorScan test market, that's a seal of approval," Skala said.

"Retailers see many presentations of new products where the only support for why a retailer should carry that new product is some type of very general consumer research. That type of consumer research tends to be unreliable in predicting actual sales because it's in an unrealistic context," she said.

The BehaviorScan testing is under real market conditions, with real customers under real-time constraints, she said. "Live test markets provide a much more accurate read on whether a new product is really going to succeed," Skala said.

"Wide test marketing is still very much in demand by manufacturers as well as by retailers to truly quantify the return on investment. Manufacturers are very definitely continuing to do test marketing as a way to make sure the product has legs before they commit to a national rollout. And IRI highly values the participation of the retailers who have been participating in test marketing for the past 20 years," Skala said.

IRI also recently completed a major upgrade to its BehaviorScan Targetable television system, an ad-testing service, she said.