Most of the time, we’re in the business of staying far, far away from the dark underbelly of advertising and marketing. But it’s Halloween, so why not shake things up a bit? From now until the end of the month, we’ll be posting the most evil, devious, and treacherous ways to decimate your competition. Stay tuned, because this is going to be almost as fun as taking candy from a baby.
Evil Market Pretesting
It’s happened to you before… you see something on a site that you like, and you click “Buy.” You’re taken to a form that takes you through the complete purchase process, but once your order is processed, the item fails to materialize. The company was out of stock. It was a “price mistake” that the company won’t honor. The item is no longer being manufactured. Your card is never charged, and you go on about your day. But what if there was more to it?
Here’s what really happened
What’s going on behind the scenes may be much simpler than an issue with the company’s production, manufacturing, or shipping pipeline. The product may not even exist. Companies can test the market prior to investing significantly in research and development by putting the item up for sale without ever creating the item itself.
It’s ultimately just a big A/B test
A company has the funds to create one new product this quarter, but they have three ideas. How does one determine which idea will be the most successful at market? By putting all three of them out there and seeing which one performs best. Companies can utilize this cheap market testing in lieu of focus groups, quantitative research, and other expensive testing options. After a short market test of 500 or 1000 potential customers, one product will have sold 20 times, and one product will not have sold at all.
Implementing market pretesting on your next startup
The best way for an entrepreneur to use this form of evil market pretesting is simply to put up your site selling whatever widget it is that your company is built to sell. Implement the site to completion — through accepting a user’s credit card. This will help provide traction and sales metrics that you can use to determine whether or not this has the potential to be a viable business prior to even developing a product!