Marketing & PR Firms - Test Marketing Companies
Saturday, November 23, 2013
Running a test market can be valuable in assessing the potential success of a new product or marketing campaign. It also can save large amounts of wasted money, time and effort if results are poor in the test market. Test marketing companies can be used to evaluate a number of factors, including product performance, customer acceptance, weight of launch material required and distribution requirements.
Consultancy
Test marketing is a service offered by market research consultancies. Companies should select a consultancy that has relevant consumer or business-to-business test marketing experience in the markets and sectors where the company operates or plans to enter. For international test marketing, the research consultancy should have local offices or associates in the target territories to provide local market expertise and knowledge.
Coverage
The test marketing consultancy should select a test region that reflects the full market as closely as possible. For companies marketing consumer products, the demographic profile of existing customers and test consumers should be similar. Companies marketing business products should select a region that includes a cross-section of businesses that reflect its small, medium and large accounts. The region also should offer advertising media that reflect the national mix in press, radio and television.
Briefing
A test marketing company can evaluate different elements of a launch program. The brief to the consultancy should set out the objectives of the program and the elements to be tested. the elements could include: customer response to the product; response to advertising; mix of media; impact of advertising; response to different creative approaches; effectiveness of sampling; response to different types of packaging; response to special offers; effect of pricing variations; and sales and retailer incentives.
Reporting
The test market report should highlight any factors that could contribute to poor performance in a full launch, such as weak advertising, unattractive packaging, lack of consumer understanding or poor distribution. Companies who can identify the weak points and feel confident about overcoming them should go ahead to launch. However, if the problems are more basic, the research agency may recommend cutting losses and not proceeding any further.
Decisions
Industry figures show a high rate of new product failures, so companies must be completely confident about going ahead. An article in the "Journal of Comparative International Management" estimated that, on average, more than 35 percent of firm revenues are generated from products that did not exist five years ago. However, the article also claimed that new product failure rates continue to remain high, with only slightly more than half of all products launched attaining any degree of commercial success.
Tags:
Marketing, Marketing amp; PR Firms
Consultancy
Test marketing is a service offered by market research consultancies. Companies should select a consultancy that has relevant consumer or business-to-business test marketing experience in the markets and sectors where the company operates or plans to enter. For international test marketing, the research consultancy should have local offices or associates in the target territories to provide local market expertise and knowledge.
Coverage
The test marketing consultancy should select a test region that reflects the full market as closely as possible. For companies marketing consumer products, the demographic profile of existing customers and test consumers should be similar. Companies marketing business products should select a region that includes a cross-section of businesses that reflect its small, medium and large accounts. The region also should offer advertising media that reflect the national mix in press, radio and television.
Briefing
A test marketing company can evaluate different elements of a launch program. The brief to the consultancy should set out the objectives of the program and the elements to be tested. the elements could include: customer response to the product; response to advertising; mix of media; impact of advertising; response to different creative approaches; effectiveness of sampling; response to different types of packaging; response to special offers; effect of pricing variations; and sales and retailer incentives.
Reporting
The test market report should highlight any factors that could contribute to poor performance in a full launch, such as weak advertising, unattractive packaging, lack of consumer understanding or poor distribution. Companies who can identify the weak points and feel confident about overcoming them should go ahead to launch. However, if the problems are more basic, the research agency may recommend cutting losses and not proceeding any further.
Decisions
Industry figures show a high rate of new product failures, so companies must be completely confident about going ahead. An article in the "Journal of Comparative International Management" estimated that, on average, more than 35 percent of firm revenues are generated from products that did not exist five years ago. However, the article also claimed that new product failure rates continue to remain high, with only slightly more than half of all products launched attaining any degree of commercial success.
