Test Marketing

Test marketing is the limited introduction of a product and marketing programme with the aim of measuring potential customer’s reactions in a market situation (McDaniel, Lamb & Hair, 2011).  When devising a test marketing programme, aspects including what length of test to undertake, what information needs to be collected, how many and in which cities will the testing be carried out in and what action to take dependant on the feedback must be considered.  Kotler and Keller (2012) and McDaniel, Lamb and Hair (2011) stress the importance of selecting suitable location which reflect market conditions to test the product. 

Test marketing can be expensive and make competitors aware of the new product, allowing them time to launch a substitute product (Beech & Chadwick, 2007).  However, test marketing can provide feedback on sales potential, level of demand, effectiveness of some facets of the marketing mix and the need for any alterations (Kotler and Armstrong, 2012).  Trott (2008) states that this feedback is useful for the decision making of the future of the product, whether it will be dropped or continue on to the next stage of the NPD process.  

An example of test marketing for a sport product is Nike Free shoes.  Nike carefully devised the advertising and marketing campaigns to highlight the shoe’s unique features of allowing movement, flex and grip to help consumers build strength and train longer.  The test marketing involved initially launching the product with limited distribution through speciality running stores as well as directly to runners through mobile vans staffed by footwear experts at running events.  In addition, Nike aimed to introduce Nike Free as a new training concept by distributing the shoe to running coaches, physiotherapists and podiatrists.  The success of Nike Free test marketing led to a major advertising campaign and the shoes becoming available through general sporting goods stores (Australian Business Case Studies, 2014).  Nike’s Free running range has continued to develop and there are now 7 different types of Nike Free Run shoes (Nike, 2015).

As Gymathlon will start up available in only a select few Gym’s before growing as a franchise, the test marketing will be limited to four locations in the North of England over a period of six months.  Two gyms would conduct sales-wave research where following an initial free session, participants would be re-offered Gymathlon as well as other competitor activities at a reduced price on 5 different occasions, the aim of this would be to identify the level of satisfaction and repurchase (Kotler & Keller, 2012).  In the other two gyms, test markets would be used to gain feedback on consumer trends and demographics, the marketing mix, demand levels and any modifications which could improve the concept.  Following this test marketing, Gymathlon would aim to have positive results to attract more franchisees.  The activity would then be advertised through different channels to target markets through all Gymathlon providers, sales promotion, adverts before Youtube fitness videos, gym nutrition sales websites as well as being showcased at Triathlon events. 

 

References

Australian Business Case Studies Pty Ltd (2014) Nike: Product development from concept to customer – Ensuring correct positioning. Available at: http://www.afrbiz.com.au/case-studies/nike-developing-nike-free/Page-5.html (Accessed: 27 January 2015).

Beech, J.G. & Chadwick, S. (Eds). (2007) The Marketing of Sport. Pearson Education.

Kotler, P. & Armstrong, G. (2012) Principles of Marketing. 14th Edn. London: Pearson Education.

Kotler, P. & Keller, K.L. (2012) Marketing Management. Global Edn. Harlow: Pearson Education.

McDaniel, C.D., Lamb, C.W. & Hair, J.F. (2011) Introduction to Marketing. 11th Edn. Ohio: South-Western Cengage Learning.

Nike (2015) Nike Free Running. Available at: http://www.nike.com/gb/en_gb/c/innovation/free (Accessed: 27 January 2015).

Trott, P. (2008) Innovation Management and New Product Development. 4th Edn. Essex: Pearson Eductation.