The U.S. test marketing scene has been going through revolutionary changes since 1980 with the advent of electronic technology with high powered minicomputers. It is now possible to collect supermarket laser scanner sales data, TV viewing patterns, packaged good purchase histories and household demographics into a single (household) source database. These data enables us for the first time to realistically evaluate the cause-and-effect relationship of many marketing variables such as advertising weight and scheduling, promotional synergy, commercial copy quality and their relationship to sales. There are three major suppliers of these test marketing services in the U.S. These are Information Resources, Inc., SAMI/Burke Inc. and A.C. Neilsen. The second part of this paper presents a new test marketing technology provided by SAMI/Burkes Test Marketing Group for capturing all panelist purchases through a supplementary data wand. In SAMI/Burkes ViewScan markets, panelists use the data wand at home to supplement purchase records gathered in scanner grocery stores by means of a scan wand. Data obtained through this combined method are presented and comparison made with respect to store scanner only data to show the significant improvement on data quality and coverage, especially in health and beauty aids and over-the-counter drug categories.
This paper shows how RBL responded to marketing managements' changed needs by adapting mini-testing methodology to reduce the time necessary for testing in a way which preserved the extended observation of the repeat buying behaviour of panellists as the basis for forecasting stable repeat purchasing rates. The standard set for the new methodology in terms of its success was the ability to provide predictions comparable with standard 20-24 week Mini-Test Market estimates of volume potential. This paper describes how the examination of Mini-Test Market data was used to build a model using the negative exponential, and how this model was shown to be capable of predicting the long term repeat purchase rate of FMCG products on the basis of 12 elapsed weeks observation of repeat purchasing data comparable with estimates achieved in the standard 20-24 week Mini-Test.
The constantly developing equipment of outlets in electronic check-outs offers new possibilities of responses to manufacturers' information needs. In fact, the installation of test zone like the SECODIP SCANNEL proves, at the same time, the dynamism of research companies and their willingness to apply new methods in the market research field. In France, the SCANNEL concept has been used by SECODIP since 1985. A test zone is already in action while 2 to 4 zones are likely to operate during the years 1988/1989.
I have been asked to sum up the learnings of this session and to provide some feedback to the presenting institutes on the future perspectives of the various instruments designed for testing marketing alternatives.
The present contribution introduces a prognosis model developed by GfK Testmarktforschung especially for data out of micro test markets. This model allows the explicit consideration of measures of the marketing mix. This permits: 1. A prognosis even if, for the national market introduction, a marketing mix is executed which differs from that realized in the test period; 2. The answer to "what-if" questions and consequently a simulation of different measures of the marketing mix. The advantages of the model will be demonstrated on the basis of various examples.
At the Campbell Soup Company, we are using the new technologies - UPC scanners at retail checkouts and individually targetable television - to maintain our new product track record. They produce a state of the art test marketing environment that offers precision, speed and breadth of information. however, so powerful is the lure of the new test vehicles that there is a potential for marketers to lose their perspective. First, we must remember that we're still dealing with human consumers; so awareness, trial and repeat take as long as ever. Secondly, there are circumstances in which test marketing is no appropriate; such as when the product has a short life cycle, when security/confidentiality is critical, when expense outweighs risk, and when speed is necessary to preempt competitors.
Test marketing new magazine ideas is not an economically feasible operation for I.P.C. Magazines' Youth Group. However, I.P.C.'s editorial and marketing expertise, gained over many years of publishing in the youth market, enables it to minimise the risk of launching into its traditionally segmented youth areas. Three first issue tests have not been carried out. The first new magazine dummy has been produced and is currently undergoing the same research technique employed for the first issue tests. These research results will be used to influence the new magazine launch decision.
The key elements to measure in a test market are: - awareness; - penetration; - repeat buying rate; - distribution. The repeat buying rate being most essential: - Standard (full-size) test markets will survive, but in a different role. It will be an instrument to optimise the marketing tools before national launch; - The go/no go decision will be taken in an earlier stage, using alternative test marketing techniques; - The attitude of the trade to a new product is becoming more and more important, however it is under-researched; - Alternative test marketing techniques will develop further and become a useful instrument.
This paper focusses on the changing nature of new product test marketing. Perhaps first, it is appropriate to discuss the reason behind test marketing. The paper describes a survey of test marketing practice covering major American grocery, drug and household products manufacturers. It is based on a sample of both major national advertisers and smaller marketers. It describes the length of time and the scope of today's test markets. And, it describes the changing techniques and how they are viewed by the manufacturer. Finally, the paper discusses the reasons behind the changes taking place, particularly the changes to controlled store testing.
The Company was considering marketing a new product in a section of the highly competitive food market. Consumer tests on samples of product from a small pilot plant had given favourable results. The decision had then to be taken either to put the product on national sale as quickly as possible or to proceed more cautiously by test marketing in a limited region first, to get a better indication of the likely national sale. The former course involved risking large expenditures on plant and promotional activities; the latter approach allowed the collection of additional information before deciding whether to incur the major part of the expenditure, but increased the time before it would become an established profit-making product. In trying to relate their information to the marketing decision to be made, our market research colleagues felt that there must be a logical way to make the decision. Accordingly, it was decided to try to formulate the problem in terms of a mathematical model.
The present paper is one of a series of reports by the authors on empirical research which has been conducted by the authors since 1967 into the problems of introducing new products. A survey of contemporary practice has highlighted the areas which are of particular concern and has led to the development of new techniques and methods of improving managerial performance in implementing existing techniques. Specific attention is paid in this instance to the key problems of grossing up test data to national equivalent levels. After examining the role of grossing up within the wider framework of test marketing activity, we shall present a number of alternative methods, some of which are currently in use, and assess the validity of these measures. It is the purpose of the present paper to examine the soundness of this procedure and to suggest ways in which we may approach more closely this fundamental goal of understanding the reaction of the market to the new offering, in order that a decision to extend distribution can be made with confidence.
The presentation focuses on the use of marketing experimental techniques by most of the Major United States grocery and drug product companies. It will be based on over 100 marketing experiments and simulations. fhree significant improvements in accuracy developed through careful data analysis including the following: 1. Improving the accuracy through greater product exposure control; 2. Using individually paired stores instead of balanced panels of stores; 3. Evaluating the data in matched panels with co-variance analyses instead of using base period data for comparing the data. Basically, the experimentation involves tight control over the marketing variables coupled with the careful statistical analysis. Simulation is replacing testing. Experimentation is applied to pricing, packaging, merchandising, and advertising decisions. The experimental approach is producing definitive and actionable marketing intelligence and predictions. The management value of the research is also quantifiable in this type of study a significant breakthrough.