Why do I need to do market research?
When you start a new business there are three key reasons to conduct research:
- To check there is a potentially profitable market opportunity for you to tap into
- To check that your product or service meets the needs of the customers you plan to target
- To help to understand how best to market your product to these customers
It’s a great opportunity to find out who your customers are, what they want and how to market to them.
A good starting point
There is a huge amount of data available online. Local government, industry and trade associations may publish data that could reveal things like market size or trends. Also, check out consumer groups and reports from research organisations such as Mintel.
Another great resource is Google Insights, you’ll be able to see online behaviour trends which could feed into your research.
It’s worth noting that online research is only secondary research and whilst you might find some interesting insight into the size of your market, you will need to more depth on your specific product or service idea.
You will need to try and have an idea of who your customers might be, their demographics and interests. Once you have an idea of this you will want to ask them questions yourself.
Doing your own research
There are lots of ways to research amongst your potential customers.
- A great (and free) starting point is to find appropriate groups on social media networks and talk to people in those groups. You’ll be amazed how many groups there are on both Linkedin and Facebook that could be a goldmine of insight for your new business. You could even set up your own Facebook group and use advertising to find potential customers to join the group.
- Hold focus group or send out a survey. You may need help from a research agency to ensure you get a representative sample of your potential customers. Doing this sort of qualitative and quantitative research is very valuable if you’re starting a high investment business and want to ensure you have the product/service, messages and marketing and distribution right. There are plenty of online research companies that can help with this.
- Run trials. Putting your product in the hands of potential customers and asking for feedback can be a hugely valuable exercise.
It’s important to ensure people feel comfortable giving negative feedback as well as positive.
Try to take criticism in a constructive way
When you have poured your heart and soul into a business idea it is easy to become blind to the feedback you’re hearing. Remember to look at everything objectively and make adjustments or refine your market, product, service and communications as required.