EVEN SMALL COMPANIES CAN TEST IDEAS BEFORE GOING TO MARKET

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Companies can test what seems to be a great product idea-ranging from package goods to financial services to new publishing titles-and not spend a fortune.

"You can test new-product concepts for less than you would imagine," said Robert Doscher, president of Response Innovations, a Hershey, Pa., direct marketing and publishing consultancy, "and head off any failures before they happen."

His system establishes an Index of Appeal, one that clients like Meredith Corp., Hearst Corp., Time Warner and the Institute of Scientific Information have employed to get a reliable reading on a product's desirability long before they ever start production. The index is a research concept developed by Reader's Digest, where Mr. Doscher was market research manager-books and records division in the 1970s.

Response Innovations teaches the concept to marketers at free seminars sponsored by Beta Research, DialAmerica Marketing, Madison Direct Marketing and Target Mailing Lists. (To register, call [717] 566-3849.) Seminars cover new-product development, telemarketing, research and alternate media like free-standing inserts and co-op ads.

Mr. Doscher said the first step is to go to current customers through an in-house database and examine their interest and buying habits in a survey.

"The marketer has this information in their database; they just need to extract it," he said.

Based on results of the first survey, Mr. Doscher's method employs five to seven new-product descriptions to test in a second survey mailed to select customers. Potential prices and succinct benefit statements also should be included, as well as places for people to say whether they would or might buy.

"You want neutral descriptions, not sell copy. You want to evaluate the product, not evaluate the advertising," Mr. Doscher said.

Afterward, promotional packages matching earlier product descriptions are mailed to hot prospects, keeping in mind applicable Federal Trade Commission rules.

Even small marketers can use the system. He said 2,500 names can be sufficient to adequately test a new idea.

Mr. Doscher said the relatively inexpensive system, for example, could test 15 new-product concepts for $10,000 to $12,000.

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