Difference testing methods are extensively used in a variety of applications from small sensory evaluation tests to large scale consumer tests. A central issue in the use of these tests is their statistical power, or the probability that if a specified difference exists it will be demonstrated as a significant difference in a difference test. A general equation for the power of any discrimination method is given. A general equation for the sample size required to meet Type I and Type 11 error specijications is also given. Sample size tables for the 2-alternative forced choice (2-AFC), 3-AFC, the duo-trio and the triangular methods are given. Tables of the psychometric functions for the 2-AFC, 3-AFC, triangular and duo-trio methods are also given.

It is important to remain creative when conducting segmentation research, as many different ways to segment a market can exist. Five main bases are discussed: geographic, demographic, psychographic, behaviouristic and image. This is followed by an overview of the main techniques used to establish and verify segments, including automatic interaction detector, conjoint analysis, multidimensional scaling and canonical analysis.

Binomial tests are commonly used in sensory difference and preference testing under the assumptions that choices are independent and choice probabilities do not vary from trial to trial. This paper addresses violations of the latter assumption (often referred to as overdispersion) and accounts for variation in inter‐trial choice probabilities following the Beta distribution. Such variation could arise as a result of differences in test substrate from trial to trial, differences in sensory acuity among subjects or the existence of latent preference segments. In fact, it is likely that overdispersion occurs ubiquitously in product testing. Using the Binomial model for data in which there is inter‐trial variation may lead to seriously misleading conclusions from a sensory difference or preference test. A simulation study in this paper based on product testing experience showed that when using a Binomial model for overdispersed Binomial data, Type I error may be 0.44 for a Binomial test specification corresponding to a level of 0.05. Underestimation of Type I error using the Binomial model may seriously undermine legal claims of product superiority in situations where overdispersion occurs. The Beta‐Binomial (BB) model, an extension of the Binomial distribution, was developed to fit overdispersed Binomial data. Procedures for estimating and testing the parameters as well as testing for goodness of fit are discussed. Procedures for determining sample size and for calculating estimate precision and test power based on the BB model are given. Numerical examples and simulation results are also given in the paper. The BB model should improve the validity of sensory difference and preference testing.