Prof’s Model Rewrites Product Design Process

Power tools and toothbrushes have helped UT Dallas School of Management Professor Brian T. Ratchford and his colleagues achieve breakthrough results in their efforts to improve the new-product design process.

In search of an effective way for designers to incorporate consumers’ subjective preferences in the creation of new products, Ratchford, Lan Luo of the University of Southern California and P.K. Kannan of the University of Maryland, used customer-ready product prototypes in marketing studies.

Testing with portable construction power grinders first and then an array of toothbrushes in a subsequent study, they gathered field data and conducted lab experiments linking such unchangeable “objective” product attributes as price, size and weight to such “subjective” perceived characteristics as power, effectiveness and ergonomic comfort.

How powerful does a portable hand grinder feel to a woodworker using it on a building site? How easy is it to use? How effective does a college undergraduate find his toothbrush?

Such questions result in qualitative rather quantitative responses, impressions and opinions rather than hard facts.

Yet “industrial designers and marketing researchers have long recognized that consumers’ perceptions of subjective characteristics exert an important influence on their product evaluations,” the research trio noted in their results.

“We used a statistical method to account for” relationships between objective and subjective qualities, Ratchford says. The method is innovative, he says, because it provides a way to incorporate subjective reactions into quantitative forecasts of demand.

Relying on this methodology, Ratchford, Luo and Kannan contributed to improving the design process by developing the first formal model that product inventors and engineers can use to better understand causal relationships between objective attributes and subjective perceptions.

The model gives designers insights into how those attributes and perceptions jointly influence buyers’ purchase decisions. The model also more accurately predicts consumer choices than older, traditional consumer preference models.

“This is important to design engineers, as well as to marketers,” Ratchford, the Charles and Nancy Davidson Distinguished Professor of Marketing at the School of Management, says of the groundbreaking work.

“Such diagnostic information can be useful for managers to position and promote the new product properly in the marketplace,” Ratchford, Luo and Kanann wrote in their research article, “Incorporating Subjective Characteristics in Product Design and Evaluations,” which appeared in the April 2008 Journal of Marketing Research (Vol. 45, No. 2, pages 182 to 194).

“Furthermore,” they summarized, “our model provides an actionable procedure so that the product designers can account for” subjective preferences in predicting why consumers would opt for alternatives to their products.

In testing their theories, Ratchford, Luo and Kanann, surveyed construction workers, both in English and in Spanish, about the grinders. The trio then studied toothbrush preferences of undergraduate marketing students at a major mid-Atlantic university.

The Marketing Research Special Interest Group (MRSIG) of the American Marketing Association recently honored their work with the 2009 Lehmann Award. Bestowed annually, the honor, named for Columbia University Marketing Professor Donald R. Lehmann, is given to the best dissertation-based article published in the Journal of Marketing Science or Journal of Marketing Research in the previous two years. Co-author Lan Luo used the study for one of her her doctoral dissertation essays.

Ratchford and Kannan also worked with Luo on another of her Ph.D. essays, “New Product Design Development Under Channel Acceptance.” That work, which gives practical methods for designers to use to take both retailer and consumer needs into account during new-product development, won the 2007 best marketing paper of the year prize, the John D.C. Little Award, from the Institute for Operations Research and the Management Sciences’ (INFORMS) Society for Marketing Science.

In bestowing the Lehmann Award, the MRSIG noted that Ratchford, Luo and Kannan’s subjective preferences study “marked an important beginning in using a quantitative model to formally address the qualitative aspects of product design and valuations.”

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