Question

Which of the following are risks associated with test marketing?

a. It can lead to competitor imitation.
b. It is an expensive process.
c. It can be time-consuming.

Answer 1

Test marketing is associated with risks such as competitor imitation, high costs, and time-consuming processes.

Step-by-step explanation:

Test marketing is a process where a company introduces its product or service to a limited market to assess its viability before a full-scale launch. There are several risks associated with test marketing:

1. Competitor imitation: When a company test markets its product, competitors may observe the product's performance, marketing tactics, and success, and imitate or replicate them. This can lead to increased competition and loss of market share for the original company.
2. Expensive process: Test marketing involves various costs, such as developing prototypes, conducting surveys, and promoting the product. These expenses can be significant and impact a company's financial resources.
3. Time-consuming: Test marketing requires time for development, testing, and analyzing the results. It can delay the overall product launch and hinder the company's ability to respond quickly to market demands.