The management team at Tablerock Foods believes that it has come up with a delicious low-calorie dessert, but it is uncertain about the type of promotional and pricing campaigns to be used that can ensure better receptivity by consumers. In this instance, the management team should probably proceed to the stage of the new-product development process.
a. idea generation
b. commercialization
c. screening
d. test marketing
e. product development
The correct answer and explanation is :
The correct answer is d. test marketing.
Explanation:
In the new-product development process, test marketing is a critical stage where companies introduce their product to a limited audience or market before launching it on a broader scale. In the case of Tablerock Foods, since the management is uncertain about the most effective promotional and pricing campaigns to generate consumer interest, test marketing allows the company to assess how well the product will perform in the real world and identify the best marketing strategies.
Here’s why test marketing is the most appropriate stage in this case:
- Product Evaluation in a Real Market Setting:
Test marketing involves introducing the product to a small segment of the target market to observe consumer reactions. This provides valuable feedback on both the product and its marketing campaigns, such as the promotional and pricing strategies that work best. By conducting test marketing, Tablerock Foods can fine-tune its promotional tactics, pricing, and distribution methods before committing to a full-scale launch. - Reducing Risk:
Test marketing helps reduce the risk of failure by providing insights into potential challenges the product may face in the broader market. Tablerock Foods can gather data on consumer preferences, taste acceptance, and the overall effectiveness of their marketing approach, which helps refine their campaign and avoid costly mistakes. - Refining the Strategy:
During test marketing, Tablerock Foods will be able to experiment with different promotional offers, pricing strategies, and even variations of the product itself. These insights are vital for ensuring that the product resonates with its intended market, increasing the likelihood of success when the product is fully commercialized.
Thus, test marketing provides the company with real-world data, guiding it through the process of refining its approach for broader market acceptance.
