test market business definition
The population group or geographic region selected for promoting the sale of a new product or service. For example, a major grocery chain chooses central Indiana as a test market for upscale convenience stores.
What factors do businesses consider when selecting test markets?
A fairly comprehensive needs assessment must be done in order to select a test market. Some factors to consider when evaluating a market include:
- assessing the number of customers available,
- determining the presence and relative success of any competitors in the area,
- understanding the demographics of the customer base, and
- gauging how easy or hard it will be for your salespeople to reach your targeted customers.
E. Mace Lewis, Vice President, Business Development, QD Healthcare Group, Greenwich, CT
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