Feasibility Study or Product Testing? How to Choose the Right Path for Your Business Growth

Introduction

Do you need a Feasibility Study or Product Testing? They are similar, but for businesses considering market research before launching in new directions, we at Tenato Strategy Inc. would like to point out some key distinctions. These two processes serve different purposes at different stages of product development cycle and influence how companies allocate resources, refine their offering, and prepare for commercialization.

Choosing either Feasibility Research or Product Testing depends on where a product or service falls in its go-to-market launch lifecycle, and the type of insights a company needs to make informed business decisions.

What is Product Testing?

As part of an overall Go-To-Market (GTM) or launch strategy, product testing is a customer-driven evaluation process used to assess a product’s performance, usability, and desirability. Here, “customers” can refer to either individual consumers, or business users. “Product” could also be a service.

For example, one of Tenato’s clients had a product delivery app concept – which had product and service aspects. The app was a product in a way, but its testing hinged on the opinions of both the consumers who would use it, and the retail stores, who would need to use a website plug-in to enable the deliveries.

To conduct Product Testing, research typically occurs in the later stages of the product development cycle when a prototype, minimum viable product (MVP), or final product is ready for consumer feedback. 

In our delivery app example, the app wasn’t a final prototype. In fact, much of its success would depend on the smoothness of the purchase check-out and speed of delivery. However, because we conducted feasibility research first (see next section) we did not make it to the product testing stage, which is described below.  

As you can see, having a prototype is essential.

Objectives of Product Testing:

• Gather customer opinions on product performance, design, and usability.
• Identify strengths and weaknesses in the product’s features.
• Assess consumer satisfaction and likelihood of purchase, or repeat purchase.
• Compare the product against competitors to gauge market positioning.
• Ensure that the product meets quality and safety standards before launch.

When is Product Testing Used?

• When a business has a near-final or completed product ready for launch.
• When refining product features to align with customer needs.
• Before a full-scale market launch to reduce the risk of negative consumer feedback.
• To conduct A/B testing on different versions of a product to determine which performs better.

What is a Feasibility Study?

Feasibility studies are conducted earlier in the product development cycle, before a company heavily invests in production, marketing, and distribution. This research assesses the viability of a product concept and whether it is worth pursuing from technical, financial, and market standpoints.

In our delivery app example, this was the stage where we began our research. Was the concept worth the effort of investing in programming and marketing? Was there a real customer need for it? These are areas that need to be addressed.

Key Areas of Feasibility Studies:

1. Market Demand & Customer Interest: Determines if there is a need for the product and whether potential customers are interested in purchasing it.
2. Technical Feasibility: Evaluates whether the product can be realistically developed, manufactured, and scaled with available technology.
3. Financial Viability: Analyzes cost projections, expected profit margins, and return on investment (ROI).
4. Organizational Readiness: Assesses whether the company has the capabilities, infrastructure, and resources to successfully bring the product to market.
5. Legal & Regulatory Considerations: Ensures compliance with industry laws, regulations, and intellectual property requirements.

When are Feasibility Studies Used?

• When a company is exploring a new product idea before committing to development.
• Before investing in manufacturing, marketing, and distribution.
• When seeking funding or investor support, as feasibility studies tell investors about the potential earning and downside risks.
• To determine competitive advantages and potential barriers to market entry.

In our delivery app example, Tenato’s client discovered that both customers and store owners were quite keen on the concept. However, the fees customers were willing to pay did not quite justify a high investment in software programming. The client also uncovered that a competitor with much deeper pockets that had recently released a very similar product. Even though our client could have competed if they invested deeply, they didn’t think it was the best use of their resources, and decided to change directions.

Why Use the Term “Feasibility Study” for New Product Concepts?

Feasibility implies financial viability – which is really at the heart of feasibility research. For new product or money-making concepts, feasibility research is the correct term because it provides a broader evaluation of a product’s potential success before significant investment. After all a product can do amazing things, but be financially cost prohibitive and never earn a dollar.

Using the term “Product Testing” too early in the process can be misleading, as it implies that a physical product exists for evaluation. However, in the case of new product ideas, what is actually needed is market validation and risk assessment, which are covered by feasibility research.

Choosing the Right Service for Your Business

For businesses seeking Feasibility Study or Product Testing, here is a simple summary.

Choose Product Testing If:

• The product is in the final stages of development, i.e. you can show it to customers.
• The company wants real customer feedback before launch.
• The goal is to refine the product concept or improve a prototype.
• The business is ready to zero in on a price for the given specifications.

Choose a Feasibility Study If:

• The product is still a concept or in the ideation phase.
• The company is unsure if the market demand and technical feasibility justify development.
• The business needs data to secure funding or stakeholder buy-in.
• The business needs to test potential ballpark pricing for a product concept.

Conclusion

Either a Feasibility Study or Product Testing will help you launch a successful product. But understanding the differences helps businesses avoid costly mistakes, optimize resources, and improve their chances of launching a successful product.

Here at Tenato, we aim to help our clients choose the right market research methods at the right times, leading to better-informed decisions and more effective product strategies. Whether refining an existing product or validating a new idea, we’re here to assist. Click here to book a free consultation any time.

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