Problem

A leading data recovery service company had developed technology that allowed it to remotely diagnose and, in many cases, remotely repair failed disk drives.  This method represented a radical departure from the standard data recovery methods.  If the market accepted such a solution, it could potentially cannibalize the mainstream data recovery business of the company.  Would there be a sufficient market for this product?  Which market segments would be the best targets for this product?  What would customers value most about the service and how should it be positioned?  How should the company price the product in order to ensure that the product did not cannibalize the company’s mainstream revenue?

Solution – Concept Validation, Pricing Strategy

KJ & Co. conducted structured, in-depth individual interviews with potential purchasers in target markets with the greatest potential.  Through this process, we were able to validate interest in the product, identify the most important perceived benefits and discover the key obstacles to purchase.  We developed the product positioning and generated alternate value-based price points.  Since the company was able to offer this solution to customers who called in with a data recovery need, KJ & Co. developed a process to test market the solution along with alternative price points.  Armed with information from the market test, we were then able to model the potential impact on the company’s mainstream data recovery business under alternate pricing scenarios.  We validated the market opportunity for the product, identified and sized key target markets, recommended product positioning and proposed a pricing structure and price levels.

Result

The company successfully launched this innovative product and it has since become a significant source of revenue and profitability.

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