Test and learn
Test and Learn
Test & Learn, is a set of practices followed by retailers and consumer-focused companies to test ideas in a small number of locations or customers to predict impact. The process is often designed to answer three questions about any tested program before rollout: 1. What impact will the program have on key performance indicators if executed across the network or customer base? 2. Will the program have a larger impact on some stores/customers than others? 3. Which components of the idea are actually working?
Historical Context
One of the pioneers of Test and Learn is Capital One. Founded in 1988, Capital One tested highly customized financial products, tailoring offers by customer. Capital One founding members have spoken of Test and Learn as a competitive advantage, crediting the company’s rapid success to frequent, rigorous, and systematic application of test and learn across their customer base.
Criticism
Companies wanting to conduct Test and Learn must mobilize, track and analyze site and customer data at very granular levels. This can often be a massive and expensive undertaking. Increasingly however, exponential increase in computing power, and decrease in its cost, have made testing more accessible.
Examples
Retail Banks running different commercials in different markets.
Fast Food restaurants launching a new menu item or product for a limited time in select locations
Big-box retailers evaluating “store of the future” programs
See Also
Clinical trials
Scientific method
Evidence-based management
Business Process Reengineering