The New Product
Development Process
Stage 7-
Test Marketing
The
New-Product Development Process (NDP) is outlined above by Kotler & Keller
(2012).
After the
product development process it is necessary to find out whether the new product
is going to be accepted into the market or not (Beri, 2013). Test marketing is
a controlled experiment, done in a limited but carefully selected part of the
marketplace (Beri, 2013).
Test
marketing involves placing a product for sale in one or more selected areas and
observing its actual performance under the proposed marketing plan (Evans &
Berman, 1982). The purpose
is to evaluate the product and pre-test marketing efforts in a real setting prior
to full-scale introduction (Hiltz, 2001). The aim is to assess how large the market
is and determine the reactions of consumers and resellers in an authentic
setting. Most companies use test marketing to lessen the risk of product
failure (Kazmi, 2007).
Test
marketing is essentially an exercise in experimentation, where the market place
is a laboratory. It also brings out that the predictability of sales or profit
is the objective of test marketing (Beri, 2013).
Example of
Test Marketing
The National
Basketball Association (NBA) is the most watched men’s professional basketball
league in the world. In 2015, the first NBA Global Games took place in London,
where the New York Knicks played the Milwaukee Bucks in a regular season game. The
NBA used this event to test the market in the UK as they eventually want to
break into the UK market. An average of 151,500
people play basketball at least once a week, compared with more than 2.1million who
play football (Sport England, 2013). Through this test marketing process, the NBA are able to
estimate the profitability of future events in the UK and hopefully increase
the number of people that play Basketball in the UK.
Test
Marketing Quick Baseball
To test
market Quick Baseball I am using a GANTT chart. A GANTT chart shows the key
stages of a project and the duration of each as a bar chart (Martin, 2002). I
have used a GANTT chart to enable me to identify the different marketing
components and when I am going to implement these components (See Appendix A
for Quick Baseball GANTT chart).
The main
components I am focusing on are the 4p’s of the marketing mix;
·
Product
(Research, Name, Logo, Profitability): Between January and May I researched
Baseball and found a gap in the market for Quick Baseball. I then came up with
the name ‘Quick Baseball’, logo (see Figure 1) and worked out how much profit
it could potentially make (See Appendix B for Potential Profit).
·
Price
(Distribution Channels): My distribution channel is direct to end users.
·
Place
(Cost, Price): From May to June I worked out how much the format would cost and
then set the product price.
·
Promotion
(Publicity, Advertising, Tickets): To promote Quick Baseball I would advertise
the format and tickets on social media and in relevant magazines such as ‘Baseball
America’.
Words- 496
References
Beri, G. (2013) Marketing Research. 5th edn. New Delhi: Tata McGraw-Hill.
Calcaterra, C. (2014). Comment of the Day: How many people really watch MLB games?. (online)
Hardballtalk.nbcsports.com. Available at: http://hardballtalk.nbcsports.com/2011/09/15/comment-of-the-day-how-many-people-really-watch-mlb-games/
(Accessed 22 Jan. 2015).
Evans, J. & Berman, B. (1982) Marketing. New York: Macmillan.
Hiltz, M. (2001) The Marketers Handbook: A Checklist Approach. Markcheck Publishing.
Kazmi, S. (2007) Marketing Management; Text and Cases. India: Excel Books.
Kotler, P. & Keller, K.L. (2012) Marketing Management. Global Edn. Harlow: Pearson Education.
Martin,
V. (2002) Managing Projects in Health and
Social Care. London: Routledge.
Sportengland.org,
(2013). Sport England - Active People Survey 7. [online] Available
at:
http://archive.sportengland.org/research/active_people_survey/active_people_survey_7.aspx [Accessed 27 Jan. 2015].
Appendix
Appendix
A- Quick Baseball GANTT Chart
Key
|
|
Indicates the 4 p’s of marketing.
|
|
|
When the implementation of the
components is going to occur.
|
Appendix
B- Potential Profit
|
Target
Market
|
Viewers
of Major League Baseball (MLB)
|
|
Size
of Target Market
|
Approx.
1.01billion people (Calcaterra, 2014)
|
|
Planned
Price
|
Ticket
price 40% cheaper that current prices for MLB. So to watch a MLB game at
Boston it would cost $50. To watch a Quick Baseball game at Boston it would
cost $20
|
|
Profit
Goals
|
Aim
to sell an average of 20,000 tickets a game (60 games will take place during
the season) at average price of $15. Total profit at end of the season= $18,000,000
|
