Product Testing vs. Market Testing

Determining whether a product will be successful can employ a range of methods. Regardless of the technique chosen, the target remains the same: gain feedback and understand the performance of a product. However, apart from a common objective, when it comes to the development of a successful product, both product and market testing take their own approach to gaining feedback at different phases of a product’s life.

Product Testing: Gaining Feedback from Consumers

Product testing, something research professionals are more familiar with, entails looking at the performance of a product by gaining feedback from consumers. There are a variety of methodologies that aid in product testing efforts. Often more specific to software or technology companies, beta testing is one such method for product testing that allows product development teams to test a pre-finalized product version with a sample of their target audience. Beta testing can be used by more than just the technology industry as it seeks to

• Identify problems or threats to product usability outside the product development process
• Refine and improve a product before the final product delivery
• Gain consumer feedback that can be used to support initial marketing communications

Another method to product testing that is used across a wider set of industries, and is similar to beta testing, is an in-home usage test (IHUT). IHUTs allow product teams to share a prototype or a finalized product with consumers. Consumers are meant to use the product in their own homes over a period of time while providing feedback on their actual usage of the product—as we know consumers can approach a product and its usage much more creatively than its intended use. IHUTs are instrumental to product testing by helping to

• Assess customer impressions, appeal, and purchase intent of a product
• Provide real-life customer reactions to not only a product but its packaging, instructions, or components to a product

Often IHUTs are left out of a product development process due to the lengthy, complicated, and expensive act of getting products into consumers’ hands. However, we employ an agile structure when it comes to executing IHUTs so that product teams can quickly conduct product testing and ensure they have the feedback they need, especially if developing a completely new or disruptive product.

Market Testing: Soft-Launching a Product

While product testing should always be utilized in some form or another before launching a product, market testing (or test marketing) isn’t always incorporated into the process due to the fact that it can be costly and time-consuming. As a result, market testing is an evaluation saved for only those products whose performance would be difficult to predict or those products that have seen inconsistent or on-the-fence feedback.

Like product testing, test marketing is still used to identify potential problems with a product that exists outside of the development process, but in a real-life buying and usage situation. So unlike product testing, market testing occurs in the market (hence the name market testing). Additionally, a large distinction should be made: market testing does not involve communication with consumers like product testing does. For example, before a consumer participates in a beta test or IHUT, they have been informed of the study parameters and requirements for feedback. Market testing simply soft-launches a product in a chosen market for a period of time before evaluating the success of the product based on key performance indicators established before the test. Ultimately, market testing is meant to

• Understand actual consumer demand and appeal of a product—particularly on-shelf next to competitor products and under influence of external market factors
• Improve the success of a full product launch and mitigate the risk of a failed one

Market testing can be a complicated process of determining where, when, and how long to have a product in the market. While product testing gathers information on how to improve the product and can help you understand the relative satisfaction, test marketing provides metrics on the actual in-market performance of the product. Further, most market testing is primarily meant to provide feedback on how to improve the marketing strategy, not just the product. By using product and market testing together, a strong product and go-to-market strategy are likely to result.

To see an example of a how a craft beer brand utilized qualitative and quantitative research to arrive at a strong product and messaging, check out the case study below. You’ll also be able to see the concept that was tested and the final product that resulted from the research.