What Are Testing Marketing Strategies (With Helpful Tips)

By Indeed Editorial Team

Published June 10, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

In a competitive market, being able to gain commercial insights into the preferences, habits, and motivations of consumers can enable businesses to thrive. Through market testing, organizations can better understand the needs of their consumers, their competitor's offering, and how well they perform in the marketplace. Understanding what market testing is and how best to use it is key to gaining a competitive advantage and maximizing sales and revenue. In this article, we define testing marketing, describe the types of market tests, explain the benefits of this practice, and offer helpful tips.

What are testing marketing techniques?

Testing marketing is an insight-collection strategy which businesses use to assess the demand for their products or services before large-scale release or launching. These strategies are crucial for informing companies and marketers about their consumer's particular needs and the best ways to meet them from a product standpoint. They also inform marketers on the types of marketing campaigns that best resonate with the demographics they wish to target, enabling them to promote their brands more effectively.

Market testing campaigns are experimental, and marketers may deploy them in specific test markets, whether they're online or in-person retail establishments. Because of their experimental nature, these tests usually don't reveal the purpose of the tests to their subjects to ensure their feedback is free of bias. In many cases, businesses collect information or receive data collections from reporting tools that they can use to better understand market trends and demands.

Related: How to Do Market Research With 6 Guided Steps (With Types)

Types of market tests

Among market tests, there are three fundamental types, namely marketing-effectiveness testing, industrial testing, and consumer goods testing. Each test type is useful in different markets and among different demographics. Here are explanations for each test type:

Marketing-effectiveness testing

Marketing-effectiveness testing, or A/B testing, is a common strategy for evaluating digital marketing to determine how effective a brand's online campaigns have been. To perform this method of testing, marketing professionals deploy similar campaigns on a range of platforms, from search engines to social media sites. They also use a range of calls-to-action, imagery, and demographic targets to evaluate which result in the highest ROI, or return on investment. Several data elements inform the relative success of these campaigns, including click-through rate, rates of sale, and platform-specific engagement.

Industrial testing

As the name implies, industrial testing relates to the evaluation of the demand, value, and effectiveness of a product within an industry. These testing practices most commonly occur in business-to-business relationships, or among advanced users of a product. There are two types of industrial testing which are:

Alpha testing

Alpha testing is an internal method of gaining feedback on a new or improved product. This is a cost-effective way to test a product, as it doesn't require additional testing campaigns or payment for third-party insights. With alpha testing, a company asks its employees to test a product and provide feedback on its benefits, and ways the company can improve it. Many tech businesses use alpha testing, asking those who worked on a program or software to use it and offer feedback to improve the product before it can move on to beta-testing.

Beta testing

Beta testing is similar to the process of alpha testing, except that instead of asking internal employees to test a product, select consumers trial them. This can be another cost-effective testing strategy, as many enthusiastic users may be content to trial a new product and offer feedback for little or no payment. Beta testing is a crucial stage, as it offers feedback gained from external users with less bias or expectation.

Related: What Is Market Intelligence? (Importance and Components)

Consumer goods testing

This is a broad category of market testing and provides in-depth insight into how consumers feel about a product in relation to the marketplace. There are four types of consumer goods tests, namely test markets, controlled market tests, simulated market tests, and sales wave research. Here are descriptions of each type of test:

Test markets

Marketers commonly run test market tests among a known target audience in particular geographical locations. A test market is a specific area or demographic segment that marketers use primarily for small-scale launches of new products. Marketers gather feedback from these small test markets before analyzing it for insights on ways to improve the product.

Simulated market tests

The purpose of simulated market tests is to determine consumer preferences when presented with a product among its competitors. Businesses often supply the products to retailers for the purpose of these simulations, which adds a cost to this testing process. Within these tests, marketers often place their product among those of their competitors and observe shoppers closely to determine their consumer preferences. Marketers often select the participants in these tests carefully to represent their key demographics. This allows them to measure their appeal to the customers who represent their most lucrative consumers.

Controlled market tests

Controlled market tests are similar to simulated marketing tests, although they usually involve the retailer purchasing the product rather than receiving it without charge for the purpose of testing. This makes controlled market tests a more cost-effective method for evaluating consumer interest. Controlled market tests also commonly involve testing presentations, sales pitches, or other advertising materials to promote the product's sale. Brands usually arrange these tests through negotiation with the retailer, and promoting the product to stimulate sales acts as an incentive for outlets to stock this new product.

Related: What Is a Market Segment? Definition, Benefits, and Steps

Sales wave research

Sales wave research serves to determine the re-purchase appeal of a product to consumers, or how likely they may be to buy something again. Testing this factor may sometimes involve using samples to see if a consumer chooses the same product a second consecutive time. This is beneficial to measure, as to build a strong consumer base, repeat purchases are essential, otherwise, a brand may exhaust its potential consumers through one-time purchases.

Benefits of test marketing

Although conducting tests can often require an investment of time, resources, funds, collateral, and capital, there are many benefits that make up for these costs to a business. The data a business can gain through market testing may save money later on by focusing marketing efforts, improving a product, and identifying buyer habits of which to take advantage. Below is a list of some of the other key benefits of test marketing:

  • Allows a business to recognize product flaws preemptively

  • Enables marketers to understand the features which consumers seek over others

  • Provides insight into the best distribution channels for a product

  • Informs marketers and retailers of the product's best sales techniques and promotion strategies

  • Identifies the best marketing channels for particular products and demographics

  • Shows marketers how the product competes against other commercial offerings

Related: Target Market Examples (With Considerations for Your Own)

Tips for market testing

When planning to conduct market research, it can be beneficial to consider a few key factors. Here are a few helpful tips for conducting market testing:

Have specific insight goals

When planning a market testing campaign, it's wise to establish goals that are as specific as possible. The more specific your goals are, the more practical your insights can be. Similarly, specific objectives allow you to gain knowledge that can direct your marketing efforts in more particular ways.

For example, if you wish to discover what percentage of consumers choose a particular coffee brand over the competitor's, considering other factors to measure such as time of day or location can better help you understand why the brand competes as it does. You may find that the market tested coffee brand competes better in sales made in the evening, as that's when professionals finishing work buy the more expensive brands.

Create actionable insights

When choosing market testing strategies, try to consider how these insights may be actionable. This means that the best market tests are those which provide insights that allow you to take action to improve the product or the brand's marketing strategies. For instance, if you're conducting beta tests, make sure that these provide feedback that allows you to develop product changes to benefit the commercial offering. If you seek to discover how a product performs on the shelf, ensure that you gain feedback on whether it's the packaging, the price, or the placement that the brand can improve on.

Related: What is Market Positioning? How to Develop a Strategy

Use multiple test types

Although each type of market test offers a different form of insight, you may use multiple in conjunction with one another to gain complementary pieces of knowledge. For instance, using beta testing to determine the best features of a new electric toothbrush can complement the features to include in online market-effectiveness tests. Determine the most vital pieces of information the brand needs for success in the marketplace, and consider which tests may reveal actionable insights, no matter how many tests this requires.

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