Source of Volume Analysis

If you need to know if your new product will cannibalize your parent brand, try Source of Volume Analysis.

The technique indicates the proportion of a new product’s volume that will be derived from a parent brand, competitive products or category growth. It can be used for any new product, line extensions or franchise extension.

Source of Volume Analysis is the percentage of volume for the new brand that is derived from other existing brands in the category. That’s different from cannibalization. Cannibalization is the percentage of an existing brand’s volume that is lost to the new brand and typically the new brand is a line extension of the existing brand.

How does it work?

In a survey, source of volume can be estimated in one of two ways. The first is via a pre/post constant sum question (such as asking respondents to select which brand they would buy in the next 10 purchases of the category, before and after exposure to a new product idea). Or we can estimate source of volume from a brand replacement question (such as “If the test product wasn't available what brand would you buy instead?”)