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The process of testing new products is part of the activities aimed at market research to test the reaction of consumers before the introduction of new products into the market. Testing new products is something a company must do first if it wants to avert any potential market failure whereby a new product fails to perform as expected after introduction into the market. In other words, testing new products is part of market strategy for manufacturers and other businesses that have a new product to introduce to the market. The exact methods for testing new products is determined by the type of product in question since different products require different approaches. Some of the tips for product testing include determining the target demographic, establishing geographic boundaries, determining the scope of the budget for the testing campaign, and offering a next-best alternative to give consumers other choices.
An example of the application of the process for testing new products can be seen in the case of a company that manufactures orange juice and is trying to introduce a new flavor of orange juice into the market. The best business practice would be to test the new flavor on consumers first before going into full production, as a means of assessing the reaction of consumers to the new product. As such, the orange juice company will have to determine the target demographic in terms of the main consumer group at which the product is aimed. If the product is meant for general use, then the orange juice company can make samples of the product and conduct taste tests where random consumers will be given samples of the product to taste and give constructive feedback to the company. Usually, companies give consumers some sort of incentive to make them agree to participate in such product tests, which may be in the form of financial or other material compensation.
As mentioned, the company must have a next-best alternative in case one particular product does not elicit the reaction the company had hoped. For instance, in the case of the orange juice company, the main proposed product will be given to consumers to taste and give their candid opinion, while other options will also be included to give them choices. As such, the orange juice company will have three to four different samples of variations of the new flavor, allowing the consumers to decide which one they prefer the most.
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