Test marketing became an essential part of every successful business. According to Oracle, the average attention span of the consumer is 8 seconds and it’s forecasted to shorten over coming years. These days, one of the biggest marketers’ struggles is to create something eye-catching and engaging.
Jeff Bezos, the founder of Amazon, said that focus on customers is the key to a successful business because, in the end, they purchase the company’s product. And when the brand is presenting a new product or service to the market, test marketing allows generating positive and negative feedback to minimize the risk of failure at the initial launch.
Test marketing is defined as a strategy used by businesses to check the vitality of their new product, service or a marketing campaign before it is launched on a large scale. This strategy is widely used by businesses worldwide to determine the consumer’s needs and if the business’s product meets the demand.
The experimental campaign can be performed in a selected test market, such as real stores, online stores and social media platforms. In most cases, the experiment is conducted without the customers’ knowledge of their participation to gather non-bias feedback on the product or service.
After collecting the feedback from the test market, the data is then analyzed and the data-backed insights are used to improve the product, service or marketing strategy. For data collection, aggregation and analysis, businesses often use reporting tools, which automate the data processes and present the results in an easy-to-understand visual report.
There are three types of test marketing — consumer goods test marketing, industrial testing and marketing-effectiveness testing. All three types are used in different test markets with different audiences to gather the most accurate feedback data.
Consumer goods test marketing — all the goods used by consumers directly. The test is conducted to know the consumer’s behavior towards the product. The businesses aim customers to go through the entire testing flow: Trial → Repeat → Adoption → Purchase. To generate the feedback, there are four types of CG (consumer goods) test marketing:
After the store testing, the tested product is distributed to the group to collect their feedback through an enterprise feedback management software. The market test can also be performed without any selected testing group. Retail stores accept to place the products together with the alternatives and monitor the sales rate.
Industrial goods are usually used by manufacturers or advanced users. There are two types of testings that help businesses to collect feedback about their product or service:
Most big-name technology companies use alpha testing before running a beta test. Companies like Apple and Samsung allow employees to test the latest products or software to gather in-house feedback and improve the product before its initial release.
The marketing-effectiveness test, also known as A/B testing, is commonly used in digital marketing to determine the effectiveness of particular marketing efforts. Marketers run similar campaigns on Google Ads, Facebook Ads or other advertising tools, with different CTA (call to action), visuals or audience targeting to see which advertisements work the best and bring the most value at the lowest ROI (return on investment). A/B tests do not involve consumers directly. They are exposed to only one advertisement. The feedback analysis can be done by collecting the testing data, including click-through, engagement and purchase rates.
The product or service testing could require an initial investment. However, the data collected will allow businesses to improve and stay on top of the competition. Here are some of the key advantages which companies can benefit from running test marketing:
Although test marketing is one of the most accurate ways to see how well the market will receive the product before launching it publicly, some major disadvantages need to be considered:
A marketing test allows businesses to see whether the product or service will be well-received in the market and avoid any potential risks the brand may face. Many methods of testing can be implemented in the business strategy. However, what matters the most, are the insights made from the collected feedback.
Using the right reporting tools allows businesses to make data-backed decisions easier and cut time on routine data collection and visualization tasks. The reporting tool can provide the test run data for marketers in an easy-to-digest, visual report, so they can determine what marketing efforts work best.
Published on Aug 04, 2021
WRITTEN BYBenediktas Kazlauskas
Benediktas is a detail-oriented writer with a passion for marketing and technologies. Most of the time, you can find him holding a cup of coffee and crafting another data-backed, insights-packed content piece.
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