Market testing
You have an idea for a new product or service, and you are excited about it. But how do you know if someone will actually buy it? We talk about how to determine if there is a market for your product before launch.
If you have an idea for a new product, you are probably very excited. It’s nice to think about the reaction it will cause when it hits the market. It is even more pleasant to dream about where to spend the earned millions. Alas, the launch of such projects should be slow and thoughtful.
The meaning of market testing
Any launch is accompanied by a lot of tests. In order not to hit them all at once, catch the mood of customers in time and, perhaps, fix something, it makes sense to launch the product in stages, iterations. Market testing is just about that.
A classic example of such testing is the history of the Zappos online store. At the launch, its founder, Nick Swinmern, had neither an online store, nor a warehouse, nor the goods themselves in stock. And there was only a website on which Nick put up several photos of shoes of different models and indicated contacts. Thus, he was testing a new business model: buying shoes on the Internet. When the orders arrived, Nick just went to another store, bought the right pair and sent it by mail. There was no question of profit, it was just an experiment, testing the idea for viability.
According to the dictionary, market testing (or market analysis) is a way to test several marketing scenarios and choose the most promising one. From an everyday point of view, this is just a way to check whether your product will sell or not — and if so, how well.
Market testing helps to get answers to fundamental questions:
In fact, these are questions about how the market will react to the launch of the product.
And if the product is fundamentally new?
We decided to clarify. Rarely does anyone come up with the idea of a product that didn’t exist before. But suddenly it came to you. What’s to be done here? After all, if there is no market as such, then what kind of analysis can we talk about?
It is necessary to study competitors and analog products, to look for at least something similar. It makes no sense to talk to the consumer about a non-existent product or service. He will never come up with a product for business. But he can say what he likes and dislikes in what he uses now, what his needs are not closed. The consumer can also test prototypes.
Market testing and product testing. What’s the difference?
They are often confused, and it’s easy to see why. But there are a few differences that help to understand the difference.
Product testing = getting feedback from consumers
Beta testing or IHUT (home use test) is conducted on a sample from the target audience. They study the characteristics of the product in the context of consumer reviews.б
Helps:
领英推荐
Market Testing = Soft product launch
They launch a product on the selected market for a certain period of time, then evaluate its success based on the KPI. Which KPIs to evaluate are decided before testing.
Helps:
The main difference is that market testing does not involve communication with consumers. It determines where, when and for how long the product will be sold on the market. While product testing provides information on how to improve the product itself — and increase customer satisfaction. To create a strong product and successfully bring it to market, you need to use both.
Before launching any new product, as a rule, it is tested in one form or another. Market testing is not always carried out, as it can be expensive and time-consuming. We are figuring out what can be done on our own.
Well, a couple of examples in the end. Have you seen such a thing?
This Ergo Spout is a device that instantly turns almost any container into a jug. The idea belongs to Kate Hansen and her husband Bryce. To test it, they needed a designer and a 3D printer. They took some prototypes, went to the local farmer’s market and chatted with visitors. After collecting enough feedback — and 60 applications from people who would like to buy the product after the launch — the couple launched a Kickstarter campaign and received $10,000 in 14 hours.
And here is a story about how to make a mistake with the target audience, but still successfully launch the product
This is the Smartcamper motorhome. You attach one to the car and travel as much as you want: inside there is a bed, heating and even a kitchen. The creators of the brand, avid tourists, at first thought that they would sell their campsites to the south — to the Krasnodar Territory and the Crimea. But it turned out that people do not want to buy a mobile home for 400 thousand rubles, they do not freeze in tents.
But the first smart camper was appreciated at the presentation in Moscow: the owners of local campsites ordered several vans for their business at once. And the main private clients were residents of Kamchatka, Sakhalin and Siberia. The soft launch allowed us to find our audience and enter the big market during the pandemic, when traveling in Russia became the most affordable type of vacation.
Conclusions
Market testing is a way to check how well a product or service will work. It usually consists of trial studies that should answer the question of how the market will react to the launch of the product.
Market testing is different from product testing. The latter is necessary in order to get feedback from consumers. The first is aimed at forecasting the market potential of the concept.
Different methods are needed for successful market testing. To begin with, you can test the idea on friends, online, create a prototype and conduct a competitive analysis. The bottom line is that market testing is an effective tool for determining the potential of a product among consumers.