Online focus groups are one of the best tools for new product development. Their speed and relative low cost make them a common step in early-stage product concept testing. Compared with in-person focus groups, online (or “virtual”) groups delivering a bundle of advantages with few downsides.

Getting early and inexpensive product feedback is one key to creating value with minimal waste, and efficient innovation is a tenet of Product Dragon’s ethical innovation mandate. Written for new product innovators who want to develop good products, this article introduces several types of online focus groups, discusses their advantages, and touches on focus group costs.

Like other forms of good research and planning, focus groups are effort multipliers.

Focus groups are most useful for very innovative product concepts, or when introducing an existing product to a new market. It takes significant amounts of time and resources to develop and launch a new product, so any tool that can reduce total costs and increase the likelihood of product success is worth considering.

Online surveys are appropriate when you know exactly what to ask, and how to ask it. But focus groups require less structure and capture more nuanced responses, which is often needed in the early product concept phase.

A focus group is typically appropriate for a product idea when you want to:

1. Validate your product concept: Test the appeal of a new product idea and determine if there may be a market for it. This can help you identify any potential roadblocks or areas for improvement before investing significant time and resources into development.
2. Gather qualitative feedback: Get consumer feedback on product features, design, pricing, and overall concept. This can help you create a product that meets the needs of your target market.
3. Observe consumer behavior: Participant body language and specific word choice gives valuable insights into their subconscious thoughts. Such data cannot be captured with questionnaires.
4. Evaluate competitive products and prototypes: Compare and contrast your product idea with similar products in the market using physical or virtual prototypes, allowing you to identify the subtle details that affect purchasing decisions.

An online focus group is a market research method where participants gather in a digital space to discuss and provide feedback on a product idea. The group is usually moderated by a researcher or facilitator who guides the discussion and collects the participants’ opinions and feedback.

The practicality of online focus groups has only recently become a reality due to the widespread availability of high-quality cameras (on laptops and smartphones), fast and reliable internet connections, and familiarity with video meeting tools like Zoom among consumers.

Online focus groups (also called virtual focus groups or remote focus groups) have significant advantages over traditional in-person groups, such as:

1. Cost-effective: Lower costs because of less overhead and participant pay.
2. Convenient and flexible: Faster and easier to schedule.
3. Wider participant pool: Gain nation-wide participation or hard-to-reach groups.
4. Less bias: Participants remain in their homes and are less biased by strange surroundings and group dynamics.
5. Video recording: Documentation is much better because every participant has their own camera.

The main disadvantages of online focus groups compared with physical ones are:

1. No physical interaction: participants cannot actually hold or try product prototypes and mockups. This is a major flaw in product categories where touch, taste, and smell are critical, such as food and cosmetics.
2. Reduced rapport. Interaction between participants and moderators is not as deep, potentially altering results.
3. Technical difficulties. Sometimes, people just disappear!

Newer formats can combine the main advantages of a survey (low cost, high sample size, and quantitative data), with those of focus groups (live responses, interaction, and qualitative data).

The “asynchronous” focus group allows people can participate at their convenience rather than at a specific time. This flexibility further reduces focus group costs.

Because participants answer standard questions in a structured way, the results can be benchmarked against other tested products. This gives further insights into the potential performance of new product ideas.

And because participants record their own sessions, the combined recording of all sessions is an excellent to share with decision makers and other project stakeholders.

While advantages include low cost, easy setup, a good mixture of data, and benchmarked results, the main disadvantage is lack of a live moderator to ask follow-up questions or clarify answers.

The cost components of most online focus groups are:

1. Design costs: Group format and questions are designed to answer the key questions.
2. Recruiting costs: Finding, screening, and managing participants.
3. Moderator costs: The group moderator’s time in preparation and execution.
4. Respondent incentives: Typically between USD$50 and $200 per participant.
5. Analysis and reporting: Packaging the results into a useful form.

A traditional in-person focus group may cost USD$10,000 to $15,000 with a standard 10-person panel, depending on configuration (try this cost calculator from Athena).

Online groups cost less mainly because there is no facility charge and participants are easier to recruit. A standard online focus group may cost $5,000 to $10,000 with US-based consumer participants.

Newer asynchronous formats can have even lower costs, especially if analysis and reporting are automated. Pricing can be in the $2,000 to $5,000 range.