Pre-Test-Market Evaluation of New Packaged Goods: A Model and Measurement Methodology

The substantial failure rate historically observed among new, low-price, frequently-purchased consumer goods placed in test markets plus the high direct cost of such activities have stimulated firms to seek ways to perform more thorough evaluations of new products prior to embarking on test marketing programs.This latter task is the focus of the work reported here.The paper describes a set of measurement procedures and models designed to produce estimates of the sales potential of new packaged goods which have been developed to the point where the product itself along with packaging and advertising materials are available and an introductory marketing plan has been formulated.The research design employed is one which attempts to simulate the awareness-trial-repeat purchase process of new product response by having a sample of consumers participate first in a laboratory experiment and then in a home usage test.Measurements obtained at several points in the design provide the input required for two models used to predict steady-state market share for the new product.The first model relates strength of post-trial preference for the new brand to probability of purchasing it.The second is a more direct representation of the trial-repeat purchase process.The structural correspondence of the two models amd procedures for estimating their parameters are examined.Finally, a case application of the system is discussed and its limitations are considered.. . . .