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ch.18 Market testing
Terms in this set (39)
basic idea of market testing is to test the combined package of product and its marketing plan to see if it will be successful, before spending a lot of money on a product launch
implement the plan in a few cities and see what happens in the real marketplace, against real competitors, being bought by real customers
market testing is not test marketing
forms of market testing
simulated test market
market tests must have teeth
insights gained at this stage include:
solid sales forecasts with greater accuracy
diagnostic information to revise or refine any aspect of the launch
deciding whether to market test
what information is needed? ex: sales volumes
nature of marketplace
capability of testing methodologies
types of information that may be lacking
vendors and resellers
asks potential buyers to do something such as say they would buy the product if it were available
the action is distinct and identifiable, and much more of the marketing strategy is utilized in the presentation
little pain for the buyer - no pain no major risks
often used in b2b and consumer durables
give full pitch on product, answer questions, discuss pricing ask - if we make this product available as i have described it, would you buy it?
simulated test market
comes very early in the development process
create a false buying situation and observe what the customer does
utilizes ATAR mode
get estimates of trial and repeat rate
procedures: mall intercept, self administered questionnaire
may not be applicable to the new to the market products
used for b2b products and consumer products sold directly to the end users
we ask them to buy
the sale of a primarily consumer product by the maker directly to the consuming unit by means of mail, telephone, etc.
cheaper than other techniques
select a limited number of outlets - each store is a minicity or minimarket
do not use regular local tv or newspaper advertising, but chosen outlets can advertise in its own flyers
ex: scanner market testing
infoScan: a system of auditing sales out of outlets selling grocery store products; a method of market test design and data gathering
all variable are go!
a firm picks several markets to sell the new product into, and test all variables including competition,trade, ad, etc.
the product is sold in the regular channels and advertised at representative levels in local media
reduces risk and creates strategy improvement
costs $1 million, length, competitor can disrupt
the roll out
select a limited area of the country and monitor sales of product there
by geo, by application, by influence, by trade channel
gives management most of the knowledge learned from a test market; it has an escape clause without losing the full budget if things bomb
new product facility - roll out requires full plant
competitors may be able to move fast
available distributors are powerful and shady
rollouts tend not to be newsworthy
importance of market testing
opportunity to obtain solid forecasts of dollar and unit sales
the planners need diagnostic information to help them revise and refine anything about a product launch that seem to require it - product, packaging, communication effort, etc.
costs involved in market testing
costs of the launch
lost revenue that a national launch would have brought
market testing and test marketing are synonymous
which of the following causes for new product failure does concept testing cover?
if there is a lacke of need for the product
lack of need
product use testing
product does not meet need
under which of the following situations will market testing be quick, if at all it takes place?
when competitors can take retaliatory action that will hurt a company launching a new product
a virtual market testing technique in which a respondent is brought into a virtual retail store environment and encouraged to look around, take products off the shelf and read the label, and make purchases
involves real purchasing under some real competitive environment
which of the following is an advantage minimarket testing provides over test marketing
minimarket testing allows for greater flexibility in changing price and other variables of a new product when compared to test marketing
the controlled sale market testing method that involves distributors and retailers or dealers in the process?
most likely to make use of a rollout
sometimes called tiered marketing
market testing should typically be carried out:
once the ideation phase begins
identify the situation in which the marketplace may not be good for market testing
in the case of global launches
identify the method of market testing more likely to be used for packaged consumer products?
identify the method of market testing that is least likely to be used for industrial goods
which of the following is a pseudo sale method of market testing?
which of the following statements is true regarding speculative sale?
it creates a false buying situation and observes what the consumers do
informal selling is a _________sale method of market testing
which of the following methods is a variation on minimarkets?
_______ is sometimes called tiered marketing or limited marketing
cannot avoid the problems of a test market
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