The ESOMAR* 2004 Asia Pacific Conference - "Ready to play: Asia as the centre of global growth" was held from March 28 to 30 in Shanghai. At the conference, Ayumi Higaki and Wouter Schuitemaker of INTAGE gave a presentation titled "The Problem's Virtually Solved: Product Launch Decision Testing and Forecasting Using Virtual Store Shelves." In the talk, they introduced virtual shelf testing using a shopping simulator (Tanagon software) and provided an actual example of new product share forecasting using data obtained from virtual shelf testing. INTAGE has packaged these testing and forecasting techniques and offers them as a service named Shelf-Choice.
* European Society for Opinion and Marketing Research

New products in Japan face an inhospitable environment, and many new FMCG entrants reach their sales peak immediately after market introduction. Unless products demonstrate the ability to obtain trial purchases right from the time of launch, they are summarily removed from store shelves. Also, the market is saturated with products, and new entrants must have the power to prevail in market competition. The ability to obtain product trials and the ability to prevail in competition - these are crucially important factors for new products coming on the market in these fiercely competitive times.

Shelf testing is an effective way of measuring ability to obtain product trials and ability to prevail in competition. However, the use of shelf testing in new product launch decision-making presents considerable difficulty, for it is necessary to display a new product under development on store shelves in the same manner as existing products. This is where virtual shelf testing plays a vital role by simplifying the research process and providing the flexibility to accommodate tight new product development schedules. With virtual shelf testing, all that is required for testing is image files of package designs.

INTAGE's Tanagon shopping simulator makes it possible to reproduce the results of apprehending mind share via real shelf testing by virtually recreating consumer in-store behavior such as viewing products, picking them up, and reading product information.

* Note: The screen images of products are simulations, and the product name is fictional.

With Tanagon, a poker chip game is used to apprehend mind share after respondents have come into contact with the products. In the chip game, respondents receive points to allocate to brands according to their level of desire to purchase. Mind share is derived by totaling the chip game scores.

Although it would be convenient if the resulting mind share could be used without modification as the forecast share, in fact things are not that simple. Consider, for instance, the effect of price; as a rule mind share is lower than observed share for low-end brands and higher than observed share for prestige brands. Also, the fact that product availability isn't factored into the mind share calculation is a cause of disjunction between mind share and measured share. For these reasons, a model is constructed for using SRI retail panel data to convert mind share into observed share.

New product mind share and variables such as estimated store coverage and estimated price are input into the constructed forecasting model, and market share for the new product is estimated.

The use of Shelf-Choice makes possible more flexible research to inform decision making. It also satisfies requirements for faster new product development and assurance of reliability in launch decisions, demands that frequently must be traded off one for the other.

To discuss how to improve your product launch decision making using shelf forecasting with Shelf-Choice, contact the INTAGE Custom Research Services Department (Tel: 86-424-76-5164).

For more information contact:
Corporate Communications Department
Tel: 86-424-23-9656
E-mail: info@intage.co.jp

» INTAGE Inc. (JASDAQ listing, Code number 4326)
2-14-11 Yatocho, Nishitokyo-shi, Tokyo
Tel: 86-424-23-1111

Established in 1960 as Japan's pioneering research company, INTAGE was ahead of the times in recognizing the importance of marketing. During the more than 40 years since, INTAGE has honed sophisticated technologies and expertise in the critical areas of research and computer systems, upgrading and expanding its information gathering networks, establishing data processing systems, and developing its own analysis tools. INTAGE uses these tools to provide valuable information - that is, intelligence - that bears closely on our clients' decision making. The company's share capital is ¥168.14 million. Annual sales are ¥23,400 million (consolidated sales for the fiscal year ended March 2003).

» INTAGE Marketing Consulting (Shanghai) Co., Ltd.
Room No. 508 Shanghai International Trade Center
2201 Yan-an Road (West) Shanghai
Tel: 86-21-6275-3322

To expand and enhance its research services in the Chinese market, in July 1999 INTAGE became Japan's first research company to establish a representative office in Shanghai. In March 2002 INTAGE upgraded the office to a locally incorporated subsidiary, establishing INTAGE Marketing Consulting (Shanghai) Co., Ltd. The subsidiary works closely with local research firms in cities across China, notably Shanghai, to provide top-quality, comprehensive marketing research services aimed at informing the Asia strategies of global corporations.