10 Tips For Effectively Choosing a Test Market
Test Markets can also be comprised of segments of people tracked during a campaign launch who are not marketed to using the same strategy as the remaining total population of the market.
It is important to understanding what a Test Market is before exploring the strategic options for effectively choosing one.
- The Test Market should have a likeness to the planned distribution outlet.
- There should be a relative isolation from other geographic areas or profiled segments.
- The Test segment should be a comprised of a representative population size.
Be aware that the Test Market is only a representation of the total market, and results of the test may show a distorted outcome.
- Availability of advertising media and public relation: the Test segment must have a reasonable amount of exposure to promotional outlets used in the test.
- There should be stability of year-round sales.
- Dominant media outlets should be available (if applicable).
- Freedom from unusual influences: this may include industry dominance from a competitor.
- In addition, be aware of the competition on the market; test market launches provide competitors with an advanced warning of your intentions.
- Suitability of the market segment is key.
Profit potential should be gauged based on the company's resources to serve the segment.
- Market Intelligence and analysis is instrumental for obtaining and reviewing the results of the test.
Examples of what you should seek to determine are:
- Buyer intentions
- Demands of the market
- Controllable and uncontrollable decision factors of the market
- Evaluate the decision process
- Sales force estimates
- Impact of environmental variables on the market segment
- Collect all relevant information and identify best alternatives (if applicable)
- Strategic Planning, based on the results of the test, to determine how to best allocate resources needed to best achieve your campaign's objectives.
It's often a great idea to consult with a marketing agency before developing and launching your test market campaign.