A market test, also known as an experimentation technique, is a research technique that consists of directly knowing people’s response to a product, service, idea, advertising strategy, or other element subject to study or analysis, to obtain information necessary for an investigation.
Generally, a market test is carried out before launching a new product on the market to evaluate its acceptance or reception, and thus reduce the risk that once on the market it will not have sufficient demand.
Carrying out a market test allows us to know the acceptance, reception, impression, reaction, or behavior of the public towards the new product and thus, based on the results, determine if its launch on the market is feasible, if it is necessary to make some changes before its launch. launch, or if its launch is not feasible.
Market testing is one of the most used research techniques when evaluating the acceptance of a new product before its launch on the market.
Market testing offers several benefits for companies, among which we can highlight:
- allows you to obtain precise information about people’s reactions or behavior towards a certain product, service, idea, or advertising strategy.
- It allows you to evaluate the acceptance of a product or service before investing time and money in its production and launch on the market, and thus reduce the risk and uncertainty inherent in the launch of a new product.
- It allows you to identify problems or failures in the product that may not have been evident during its development, and thus be able to make the necessary adjustments before its launch.
- It helps identify market segments that could be more receptive to the product or service, and thus be able to better define the target audience.
- provides information that could be useful when calculating demand for the product, setting its price, determining advertising media, designing advertisements, and establishing sales channels.
- It helps create expectations for the product, and promote it through “word of mouth.”
However, like any research technique, market testing also has some disadvantages, among which we can mention:
- uses a small sample that is not representative of the total market, so the results obtained may not accurately reflect the response of consumers and, therefore, could not be generalized.
- There is a risk that competitors will observe the product or service and imitate it before it is launched.
- Testing a limited amount of a product can be expensive and time-consuming.
Due to these disadvantages, it is always advisable to use market testing together with other information-gathering techniques, such as surveys, observation techniques, and focus groups.
No rule says how to do a market test, but in general, to do one the following steps are usually followed:
- Establishing objectives: first, the objectives of the market test must be established; That is, determine what it is that we want to achieve with it; for example, knowing the acceptance of a product, identifying problems or failures in a product, knowing the demand for the product, or measuring customer satisfaction.
- Test plan design – The next step is to plan all the elements related to the market test; for example, the number of products to be tested, how, when, where, and for how long it will be done, and who will lead it.
- Test implementation: The market test is then carried out as planned; For example, a sales position or tasting stand is set up, a group of people are summoned to try the product or service, or the product is put up for sale at a certain point of sale.
- Information collection: In this step, the data obtained through the market test is collected; For example, consumers’ responses are recorded, or their reactions are noted when trying the product or service.
- Analysis of the information: the information collected is then analyzed to obtain the corresponding conclusions; For example, the reception of the product, consumers’ reactions to it, and their impressions and comments are analyzed.
- Decision making: Finally, based on the analysis carried out, decisions are made; For example, you decide whether to launch the product on the market, make improvements or adjustments before launch, or discard it and design or test other products.
Something important to take into account when doing a market test is that the product could be observed and copied by competitors, who could even introduce it to the market before you, so it is necessary to ensure that the product is not easily imitated, in addition to taking other precautions to prevent this from happening.
There are various types of market tests, which vary according to the objectives of the test, the product, and the target audience, and can range from tests that allow us to evaluate the reception of a product or know its demand, to tests that help set the price. of a product or choose one among several.
Finally, let’s see below some examples of simple market tests that we can perform:
- Enable a small sales stand strategically located taking into account the target audience, where we sell the new product and observe the reception it has from the public, at the same time we measure the purchases made on the day and thus, based on the results, forecast the sales we could obtain by having several points of sale.
- Enable a tasting stand where we can try or taste the new product and observe the public’s acceptance and reaction to it while asking for their impressions or opinions.
- Convene a group of people and give them a try or have them experiment with the new product, observe their reactions and behaviors to it, and then ask them for their impressions and suggestions.
- To sell the new product in only one of the points of sale we have to evaluate its acceptance and demand before selling it in all of them or, in case of working with intermediaries, ask some of them to sell the new product in exchange for giving them free products, and then consult them about the results obtained.
- Invite people with their children and ask them to play with various toys including ours, then observe if the children play with our product, their behavior when they play with it, and for how long they do so; and then ask them which toy they liked the most and what they liked most about ours.
- Sell the product at two similar points of sale, but located in distant places, and with two different prices to evaluate the effect on sales of each of the prices, and thus know which is the most convenient.
- Convene a group of people and give them a plan or preview of the product to know their impressions about the idea of the product, and thus have an idea of its viability, in addition to obtaining ideas and advice for possible improvements that will help us finish the project. develop it.
- Select a group of people and give them several versions of the same product to test and compare, and then ask them to tell us which version they prefer and why, so we know which version we should launch on the market or what we should focus on.
- Select a group of people and give them the product to use in their homes for a certain period to evaluate how the product integrates into people’s daily lives, in addition to testing its performance over some time prolonged, and identify possible problems or defects.
