So you’ve had an idea for a business. You tell your nearest and dearest about it and they all think it’s wonderful. But are they right? Well unless your target market consists entirely of your friends and family, probably not. One of the most important things to do when considering starting a business is market research. It really is essential to do this thoroughly as soon as you can, rather than proceeding regardless and potentially wasting both time and money. We’ve put together a few basic tips for Market Research that you ought to consider when starting up.
Determine your Goals Obviously if you are thinking about starting a business, the aim of your market research should be to determine if there is a demand for the product or service you are considering. The end goal of any research you undertake should therefore be to determine whether or not you carry on with your idea or identify any ways that you should adapt it.
Define your Target Market You’ll also need to identify who you are aiming your product or service at. You should already have a good idea of this, even from the initial conception stage. Whilst there may be some businesses that quite literally have mass market appeal in that they are aimed at all sections of society, they do tend to be the exception rather than the norm. Define who your ideal customer is and make sure that it is this demographic group that you target when undertaking any market research activities. There is no point after all in doing a survey of teenagers when your product is going to be aimed at middle-aged businessmen.
Create your Research Strategy There are all sorts of ways that you can undertake Market Research as a startup and the good thing is that it does not necessarily have to cost the earth. The internet can be a great source of market research - other organisations surveys and findings may help, trade journals and newspapers likewise. Also you can avail of services such as Mintel and the Office of National Statistics which can provide detailed data on your target demographic group. You may wish to create surveys using online tools such as Mailchimp and Survey Monkey or even undertake surveys of your Social Media followers. It’s important simply to have a clear plan of what activities you are going to undertake so that you can fully measure results.
Check the Competition Unless your idea is entirely unique in every way, chances are there is another organisation out there making a similar product or providing a similar service. Similarly, other organisations may be marketing their product or service at the same target market as you. It’s important therefore to identify who your competition is and then to gather as much information as you can about them. Check how they offer the product or service, where they promote and sell it, when they do this and also what prices they charge. You can do this through simple observation and learning about what they do or even perhaps by undertaking a ‘mystery shop’ type exercise where you purport to be a potential customer. Assessing the competition is an essential element of any market research strategy.
Collate and React to your Findings Collating and reacting to the findings of your market research activities is essential if you are going to progress with your idea. If your research proves that there is no demand for your product or service or that there is very little demand, perhaps it’s time to go back to the drawing board. Your idea may not necessarily be a complete no-no but may simply require a little adaptation. It’s important to remember that feedback that you obtain from your target market ought to be listened to - they are after all your potential customers. We’re not suggesting that you simply give up if market research proves to be negative towards your idea, however be prepared that you may need to change direction just a tad.