test market

test market definition - business

test market

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:

  1. assessing the number of customers available,
  2. determining the presence and relative success of any competitors in the area,
  3. understanding the demographics of the customer base, and
  4. 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

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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