Product Research

Product research refers to the systematic process of gathering information, analyzing data, and evaluating various factors related to the development, design, marketing, and improvement of a product. It involves understanding the market, customer's needs and preferences, competitor's offerings, and technological advancements to make informed decisions throughout the product lifecycle.

The main objectives of product research include:

• Identifying customer needs: Research helps in understanding the problems, desires, and preferences of potential customers. By collecting data through surveys, interviews, focus groups, or market analysis, businesses can gain insights into what customers want and need from a product.

• Market analysis: Product research involves analyzing the market dynamics, including size, growth potential, trends, and competitive landscape. This helps in identifying opportunities and potential challenges in the market, allowing businesses to position their product effectively.

• Concept testing: Before investing resources into product development, research allows companies to test their product ideas or concepts. It helps in evaluating the viability, desirability, and potential success of a product in the market. This can be done through surveys, prototypes, or market simulations.

• Design and development: Research plays a crucial role in guiding the design and development process of a product. It provides insights into user experience, usability, aesthetics, and functionality, ensuring that the product meets customers' expectations and requirements.

• Pricing and positioning: Research helps in determining the optimal price for a product by considering factors such as production costs, competitor pricing, and perceived value. It also assists in positioning the product in the market by understanding target market segments, their preferences, and effective marketing strategies.

• Continuous improvement: Even after a product is launched, research remains essential for gathering feedback and monitoring customer satisfaction. This helps in identifying areas for improvement, addressing issues, and adapting the product to changing market demands.

Methods used in product research may include surveys, interviews, focus groups, observational studies, data analysis, prototype testing, and market analysis. The findings from product research are used to make data-driven decisions and guide the entire product development and marketing process.

• Early Years (1971-1986): Starbucks was founded by Jerry Baldwin, Zev Siegl, and Gordon Bowker which was initially a small store selling whole coffee beans. The company primarily targeted coffee enthusiasts and catered to a niche market of people interested in high-quality coffee.

• Howard Schultz Era (1987-2000): Howard Schultz, a former Starbucks marketing director, played a pivotal role in shaping the company's future. He envisioned transforming Starbucks into a place where people could gather and socialize while enjoying premium coffee. Schultz expanded the company aggressively, introduced espresso-based drinks, and emphasized creating a unique customer experience.

• Global Expansion (2001-2010): Starbucks embarked on a global expansion strategy, opening stores in various countries worldwide. The company aimed to become a global brand synonymous with high-quality coffee. However, this period also saw some challenges due to rapid expansion, which resulted in over-saturation and declining sales in some markets.

• Product Diversification (2011-2015): Starbucks began diversifying its product offerings beyond coffee. It introduced new food items, such as pastries and sandwiches, to complement its beverage menu. This move aimed to attract a broader customer base and increase sales throughout the day.

• Digital Innovation (2015-present): Starbucks embraced digital technology to enhance customer experience and convenience. The company introduced the Starbucks Mobile App, allowing customers to order and pay using their smartphones. They also launched a rewards program that offered personalized offers and promotions to app users. 

• Sustainability and Social Impact: In recent years, Starbucks has placed an increased emphasis on sustainability and social responsibility. The company has made commitments to ethically sourced coffee, reducing its environmental footprint, and supporting social causes. Initiatives like the Starbucks Global Farmer Fund and the Greener Stores framework demonstrate their focus on these areas.

• Beyond Coffee: Starbucks has continued to expand its product portfolio beyond coffee beverages. They acquired tea retailer Teavana in 2012 and have since developed a range of tea-based beverages and retail products. Additionally, Starbucks has explored new ventures such as the Reserve Roastery and Reserve Stores, which offer an elevated coffee experience with unique brewing methods and premium offerings.

Overall, Starbucks has evolved from a small coffee bean store to a global coffeehouse chain that redefined the coffee culture and experience. Its focus on quality, innovation, and customer engagement has been key to its success and enduring popularity. As of 2022, the world has 35,711 Starbucks stores with USA leading the market with 15,328 stores followed by China (4,704), Korea (1,468) and 80 plus countries. India is currently nesting 327 Starbucks stores. 

OYO, originally known as OYO Rooms, is a hospitality company that was founded in 2013 by Ritesh Agarwal in India. It started as a budget hotel aggregator, aiming to provide affordable and standardized accommodations to travelers. Since its inception, OYO has gone through several stages of evolution and expansion. Here's an overview of the key milestones in OYO's evolution:

• Early Days and Expansion in India (2013-2015): OYO began as a platform that partnered with budget hotels, offering standardized amenities and quality assurance to customers. It quickly gained popularity and expanded its operations to multiple cities in India, leveraging technology to streamline bookings and operations.

• Funding and Growth (2015-2018): OYO attracted significant investments from various venture capital firms, including SoftBank Group, leading to rapid expansion. It expanded beyond India's borders and launched operations in countries like Malaysia, Nepal, China, and the United Arab Emirates. During this period, OYO also introduced new services such as OYO Townhouse, a mid-scale hotel brand.

• OYO's China Expansion (2018-2019): OYO's entry into the Chinese market was a significant milestone in its growth. It acquired domestic hotel chains and rebranded them under the OYO umbrella. The expansion in China helped OYO become one of the largest hotel chains in the country. However, it faced challenges in sustaining profitability due to intense competition.

• Global Expansion and Diversification (2019-2021): OYO continued to expand its global footprint by entering new markets, including the United States, Europe, Southeast Asia, and Latin America. It also diversified its offerings beyond hotels by introducing OYO Homes, a vacation rental service, and OYO LIFE, a long-term rental solution. OYO also launched OYO Workspaces, targeting the co-working segment.

• Challenges and Restructuring (2020-2021): Like many companies in the travel and hospitality industry, OYO faced challenges during the COVID-19 pandemic. It had to downsize its workforce and restructure operations to adapt to the changing market conditions. OYO also focused on enhancing its technology platforms and implementing cost optimization measures.

OYO in the Market

1. Global Presence: As of September 2021, OYO had a presence in over 80 countries, including major markets such as India, China, the United States, and several countries across Europe, Southeast Asia, and Latin America.

2. Number of Hotels: OYO had grown rapidly in terms of the number of hotels under its brand. In 2020, it claimed to have more than 1.5 million rooms across its global network.

3. Valuation: OYO had attracted significant investments, which led to impressive valuations. As of September 2021, OYO was valued at around $9 billion.

4. Revenue: OYO's revenue figures were not publicly disclosed, but the company had been striving to achieve profitability and improve its financial performance. However, it's important to note that the COVID-19 pandemic had a significant impact on the travel and hospitality industry, and OYO was not immune to these challenges.

5. Competitive Landscape: OYO faced competition from various players in the hospitality industry, including traditional hotel chains, online travel agencies, and other hotel aggregators. The competitive landscape varied across different regions, with local competitors often challenging OYO's market share.

Market Research / Study

Market research is the process of gathering, analyzing, and interpreting information about a specific market or industry to support business decision-making. It involves systematic and objective collection of data and insights related to customers, competitors, market trends, and other relevant factors. The goal of market research is to provide organizations with a deeper understanding of their target market, enabling them to make informed strategic decisions and develop effective marketing strategies.

Market research can encompass various methods and techniques to gather information. Some common approaches include:

• Surveys and Questionnaires: Collecting data by asking specific questions to a sample of individuals or businesses. This can be conducted through online surveys, phone interviews, or face-to-face interactions.

• Interviews and Focus Groups: Conducting in-depth interviews with individuals or organizing small group discussions to gain qualitative insights into consumer behavior, preferences, and opinions.

• Observation: Observing consumer behavior and interactions in real-life settings or controlled environments to understand their decision-making process and usage patterns.

• Secondary Research: Analyzing existing data and information from various sources, such as market reports, industry publications, government statistics, and online databases.

• Competitive Analysis: Evaluating competitors' strategies, products, pricing, positioning, and market share to understand their strengths, weaknesses, and market trends.

• Data Analysis: Utilizing statistical techniques and software to analyze the collected data, identify patterns, and draw meaningful conclusions.

The insights gained through market research can be used to identify customer needs, preferences, and behavior, evaluate market size and growth potential, assess market trends and opportunities, understand competitive dynamics, test and refine marketing strategies and product concepts, support decision-making for product development, pricing, and distribution, measure customer satisfaction and brand perception, identify target market segments and positioning strategies.

Market research is an essential tool for organizations to gain a competitive edge, minimize risks, and make informed business decisions based on reliable data and insights.

Forms of Untruthful Advertising

At times, advertising can be deceptive or untrue as it may include misleading or inappropriate information or tall and false claims to deceive the audiences to make a move in the favor of the advertiser. Various such tactics followed by advertisers are discussed below: 

1. Deceptive Pricing: There have been several instances of businesses concealing taxes or surcharges from customers via deception. For example, there is an airline ticket booking service that claims to purchase your flights for as little as Rs. 1,000/-. After reviewing the advertising, you decide to book one. However, once the ticket reaches the final payment step, your bill turns out to be Rs. 2,000. These might be illegal charges on consumers’ bills, which refers to “cramming”. If any such “additional charge” or “hidden costs” arises in the name of different charges, customers have the right to file a complaint with the Consumer Forum.

2. Deceptive Measurements or Quantities: There may be times when the firm provides a fake quantity. If the brand has given a measurement or amount less or more than the actual one, they are accountable for misleading information. 

3. Deceptive Comparisons: In the market, there is always unavoidable competition between two brands. The rivalry, however, is considered to be fair only if the businesses continue to promote their brand’s features. When a firm chooses to promote itself against its competitors by comparing their characteristics, it becomes a misleading advertisement.

4. Deceptive Guarantee or Warranty: Different brands and corporations provide guarantees or warranties on their products. They aim to increase the value of their brand by giving such tactics to the public. However, the brand may not always explain the solution and may subsequently reject to assist the client. It is when a customer has the right to sue a brand because of misleading advertising. A brand must respond to the consumer if they misled them about the promise. Contract law needs clarity for a contract to be binding; thus, rules governing misleading and fraudulent advertising must fill the void. 

5. Bait and Switch: Bait and switch are essential methods marketers use to show one product as bait and then switch it with another. They proceed to market an upgraded product before you after offering a low-cost one. A store advertises a low-cost product that they have no intention of selling. However, when the buyer contacts them about purchasing the product, the vendor compels them not to do so. They instead laud a high-priced product and persuade the buyer to buy the upgraded version.

6. Misleading Depiction of Product: There are always occasions when corporations provide appealing images of their items to get customers to purchase them. This is unmistakably fraudulent advertising. Some food product businesses show a different image on the package and avoid the legislation by mentioning in the corner that the image is a serving recommendation. Such businesses have made wise decisions. A few fruits that are packaged in packets exhibit a false-color of the items that they are.

7. Ignorance of vital message: There may be instances where businesses withhold critical information from their customers. For example, while advertising paneer, the advertisement must state that it must be used within five days from opening the packet. These are the details that the audience must be aware to avoid loss. As a result, mentioning them should be an essential element of the company’s advertising strategy.

8. Misuse of the word "free": Many organisations show the word free in their advertisements especially the ones running in price sensitive markets. In such markets, consumers expect more for less cost and anything coming free of cost is always an attraction. This free element can be an independent product, extra quantity of the same product in the packet subject to conditions. The only thing to be noted here is that the quality of the product should not be compromised for the act of "free-ness". A misleading ad can also include false promises, hidden conditions, deceptive product property, contests and prizes, usage of word "No. 1", etc.

Negative Impact of Advertising

While advertising can be a powerful tool for businesses to promote their products or services, it is not without potential negative impacts. Here are some common negative effects associated with advertising:

• Intrusion and Overload: Advertising can be intrusive and disruptive, especially when it interrupts the viewing or browsing experience of consumers. Excessive and overwhelming advertising can lead to an overload of information and make it difficult for consumers to filter through the clutter. For example, the ads that pop up while happily watching a video on YouTube, a television serial showing ads by cutting the next scene developing extreme curiosity among viewers. 

• Deceptive or Misleading Practices: Some advertisements may use deceptive tactics or make false claims, leading to consumer confusion or disappointment. Misleading advertisements can erode trust and damage the reputation of both the advertiser and the industry as a whole.

• Exploitation of Insecurities and Vulnerabilities: Advertising often plays on consumers' insecurities, creating unrealistic expectations and promoting materialism. It can perpetuate societal pressures related to body image, success, and self-worth, leading to negative psychological effects, especially on vulnerable populations such as children and teenagers.

• Impact on Self-Esteem: Certain advertising messages that propagate idealized standards of beauty or success can negatively impact individuals' self-esteem, leading to feelings of inadequacy, body dissatisfaction, or low self-worth.

• Consumer Manipulation: Advertisements are designed to influence consumer behavior and persuade individuals to purchase products or services. Manipulative advertising techniques can exploit cognitive biases or emotional triggers, potentially leading to impulsive buying decisions or buyer's remorse.

• Increased Materialism and Consumption: Advertising often fosters a culture of consumerism, encouraging the continuous acquisition of products and services. This can contribute to resource depletion, environmental degradation, and a focus on material possessions rather than sustainable living.

• Privacy Concerns: Digital advertising often relies on collecting and utilizing personal data, raising privacy concerns among consumers. The collection and use of consumer data for targeted advertising can lead to a sense of invasion and compromise individuals' privacy rights.

• Stereotyping and Social Influence: Advertisements can reinforce stereotypes related to gender, race, or other demographic factors, perpetuating social biases and exclusion. They can also shape societal norms, influencing behavior and reinforcing social pressures.

It's important to note that not all advertising has negative impacts, and many advertising campaigns strive to be ethical, informative, and engaging. Advertisers and regulators have a responsibility to ensure transparency, ethical practices, and adherence to regulations to minimize the negative effects of advertising. Additionally, consumers can become more media literate, critically evaluate advertisements, and make informed choices to mitigate the potential negative impacts.

Deceptive and Misleading Advertisements: Case Study

1. Sensodyne Toothpaste: In India, the Central Consumer Protection Authority noted an absence of relevant study or material indicating worldwide prominence of Sensodyne products. Considering the same, they directed the Sensodyne toothpaste to cease the telecast of its misleading commercial within seven days in which it was claimed that the stated toothpaste is recommended by dentists worldwide and that it is the world's number one sensitivity toothpaste. The Authority also slapped a fine payment of ten lakh rupees as penalty. 

2. Neeraj Clinic, Rishikesh: Despite the Drugs and Magic Remedies (Objectionable Advertisements) Act, which specifically prohibits advertisements pertaining to several diseases including epilepsy, R.K. Gupta advertised with impunity, his clinic and claimed that he was offering a sure cure for epilepsy. Ironically, way back in 2000, the Indian Medical Association had declared him a quack after a committee had found that he was giving his patients toxic drugs in high doses. Yet, he continued to advertise. Again in May 2003, on a complaint from a consumer, the Advertising Standards Council of India (ASCI), a self-regulatory body of the advertising industry, had held that the advertisement was in violation of the Drugs and Magic Remedies (Objectionable Advertisements) Act and the Rajasthan Patrika wherein the advertisement had appeared had informed ASCI that the advertisement department had been advised to withhold further advertisements of the clinic. Yet, R.K. Gupta continued to advertise in other newspapers- in fact on the front pages of major English dailies and also on television channels, wherein he produced “testimonials” from people who, the advertisements claimed, had been cured of epilepsy. In the end, on a complaint from a non-resident Indian, who visited the clinic for the treatment of his son and got suspicious about the medicines that the enforcement agencies finally acted. Following a complaint filed by Mr. Anjon Chowdhury, through the Indian High Commission in Canada, the Drug Controller got the medicines prescribed by the clinic tested and found that it contained drugs which were either banned or controlled under Narcotic Drugs and Psychotropic Substances Act. His clinic was then raided and R.K. Gupta was subsequently arrested under the NDPS Act. He was also booked under the Drugs and Magic Remedies (Objectionable Advertisements) Act.

3. Conybio Health Care: in the year 2003, Consumer Education and Research society, Ahmedabad, had to bring to the notice of the regulatory authority in Gujarat, the sale and promotion of certain health gadgets by Conybio Health Care, in violation of the Drugs and Magic Remedies (Objectionable Advertisements) Act. The company was promoting and distributing sun shade to cure migraine and sun stroke, socks for acidity, pillow covers for spondylitis, palm guards for Parkinson’s disease, eye-shade for sinusitis, T-shirts for high, low blood pressure, short pants that cure gas, acidity, prostate, piles, urinary system problems, ladies briefs for menstrual problems, bed sheets for curing paralysis/ strokes and brassieres for breast cancer!! When the regulator asked the company to produce scientific evidence to support the effect of infrared rays which it claimed was present in the products, the company said it had never undertaken such studies by any recognized Indian institute. Subsequently, the regulator prohibited the sale and promotion of the products.

4. Advertisements pertaining to ‘discount sales’, advertisements on vehicles making misleading or false claims about their petrol consumption, false claims about the purity of gold / jewellery, shampoos that claim to ‘stop hair fall’, face creams that promise ‘wrinkle removal’, toothpastes that claim to prevent tooth decay and cavity and advertisements of educational institutions that make false claims about their recognition or affiliation or about the employment prospects.

5. Horlicks: GSK Consumer Healthcare was once in the dock with authorities for another of its product other than Sensodyne. The authorities had clamped down on the advertisement of Horlicks for claiming that 9 out 10 children’s diet is deficient in essential nutrients. The Advertising Standards Council of India (ASCI) said that the claim was misleading and exaggerated.

6. Byju: Byju’s claim about its learning app that 1 crore students were taking its courses and that 90% of them renew their subscription was touted to be untrue.

7. Apollo Hospitals: Apollo Hospitals in one of its advertisements had claimed, “Achieve freedom from your weight issues,” which can mean a cure for various obesity related diseases such as diabetes, infertility, heart diseases, etc. ASCI called out the ad for being unsubstantiated with research and for being misleading.

8. Dove: Hindustan Unilever Ltd came under scanner of the ASCI for its Dove Hair Fall Rescue Shampoo advertisement, which implied reduction in natural hair fall. ASCI called it misleading.

9. Usha Electronics: Usha International advertisement claim for its Usha Honeywell evaporative air cooler which said 'cools up to 80 square metres', was found inadequately substantiated under test conditions and misleading by exaggeration.

10. Kindle: Amazon Kindle’s advertisement for ‘Unlimited Reading’ was held to be not substantiated as a limit of 10 books was advertised as an ‘unlimited offer’.

11. Patanjali: Patanjali’s Coronil which was claimed to be a cure for Coronavirus. It was found to be misleading and untrue and the same was published by the Board in order to make the public aware of its nature.

Source:

1. www.dailyo.in

2. Global Advertising Lawyer's Alliance

3. www.ijalr.in