What is test marketing?
Test marketing is a technique used during product development to determine how people respond to a product. It can be used at many different stages of development to see whether or not the audience will buy the product, how the product might need to be tweaked to make it appealing to the audience, and how audience members interact with the product. Using insights from test marketing, product developers can refine products to make them more commercially viable before embarking on a project's wide rollout.
One of the simplest forms of this type of marketing is online test marketing, in which a manufacturer produces a survey to determine whether the public really wants a product. Research can also provide useful data on how many people would be willing to pay for a product, whether or not people would travel to get it, what kind of features they would look for, etc. This form of marketing can also be done through telephone and postal surveys sent to a specific area of the population.
Once a product is in development, companies can embark on a marketing test that involves bringing real examples from the audience. They expose the product to a selected area of the audience to see how they respond. For example, a car manufacturer might take prototypes to some big cities seen as trendsetters to see how people respond and give them a chance to interact with the car. Or, a potato chip maker could send a new flavor to a select group of supermarkets, asking them to put it on the shelf as a regular product and monitor consumer response.
Companies use test marketing to gather information about audience response to their products. This information can be used to completely rework a product or add features. It also informs the advertising campaign, ensuring that ads are presented in a way that represents the product, reaches the target audience, and piques people's interest in purchasing the product. Marketing tests are critical, and companies that don't perform them can get into trouble when starting a big advertising campaign and product launch.
Entrepreneurs interested in selling something entirely new are often encouraged to engage in marketing trials before leaving their jobs or savings. This allows them to explore the idea of introducing the product to the market. Members of the public may not respond, making investment in actual product development unwise.