Test marketing financial definition of test marketing
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test marketing a prelaunch trial run of a NEW PRODUCT involving a representative sample of prospective buyers who are given the product to try. Consumers' opinions and views about the performance of the product, its quality and the satisfaction they derive from it are compiled, often alongside consumer reaction to a range of possible prices that could be charged for the product. This data is then used by the firm to decide whether or not to go ahead and launch the product on to the market. Test-market reactions are useful not only in establishing whether actually to launch the product, but also in indicating whether changes in its attributes (quality, shape and form, styling etc.) would strengthen its appeal and which consumer perceptions about the product might usefully form the basis of advertising the product to maximize its impact on prospective buyers. See ADVERTISING COPY, ADVERTISING EFFECTIVENESS TESTS, NEW-PRODUCT DEVELOPMENT.