Test marketing is a strategy used by companies to gauge the viability of their new product or service before it is launched on a larger scale. This process involves introducing the product to a limited and carefully selected segment of the market in order to collect valuable feedback and insights from actual customers. By conducting test marketing, businesses can identify any potential issues, assess consumer responses, and fine-tune their marketing mix, which includes product features, price, distribution channels, and promotional strategies. It serves as a risk mitigation step that allows the company to make necessary adjustments and predict the product’s performance in the broader market more accurately. Test marketing helps in making informed decisions about whether to proceed with a full-scale launch, modify the product, or abandon the project altogether, thus saving the company from significant losses that could occur from an unsuccessful product launch.
