Research the Opportunity

You are excited about your business idea and you are already envisioning all the possibilities. Now is the time to make sure that your Business Idea is indeed viable and you not getting carried away by the sheer excitement.

Detailed Market Research is an absolute necessity at this stage. Market Research can help you determine if there is enough demand for your product and service.

It is an excellent idea to scan the internet and gather as much information as possible about the following:

• Industry - Its size, its growth and its future. What are the prevailing trends?
• Competition: Study all aspects of Competition - Direct as well as Indirect.
• Customers, Influencers & Consumers: Try to understand what the Purchasers, Influencers and the end users of Product / Services are saying. Social media can be very useful in this regard. Understand what are the unmet needs and what needs improvement. It is very  important to meet and really understand the current purchasers / users of your competitors products. Are they unhappy about something? What needs improvement?

Conducting Market Research

Primary market research - Primary Market Research is first hand information from customers and potential customers. Primary market research is more expensive and time consuming to perform than secondary market research, however the information it offers can be much more specific and valuable.

• Market Research Surveys- Surveys by phone, mail or in person are used to assess the potential success of a product or service. Surveys are a highly used method of small business market research.

• Market Research Focus Groups- A Focus Group is a group of people (usually 6-10) who gather around to talk about a particular product, service, problems they have and more. A focus group can help you gain valuable insight about potential customers, by discovering their likes, dislikes and problems.

• Market Research Individual Interviews- Instead of conducting a group interview (focus group) you can also conduct individual interviews. Conducting Market Research Interviews provides you with the opportunity to meet individually with your target market. Instead of conducting a group interview such as a focus group you can also conduct individual interviews. In an individual interview the researcher asks the targeted buyer questions similar to those in a focus group. The researcher asks about the interviewees’ likes, dislikes, problems and opinions of a product or service. You can choose to conduct the individual interview in person or over the phone. One disadvantage of individual interviews over focus groups is that the interviewees don’t get to interact with one another. For example in a focus group, one person may say something that causes a reaction in another and suddenly bursts of ideas start sprouting. In individual interviews there isn’t that same kind of interaction. However an advantage of individual interviews is that you get to talk to your target buyer one-on-one and get more information about that individual and their specific thoughts and opinions.

Secondary market research Sources -

• Reports/ Studies (University studies)

• Local Newspapers and business magazines -many local newspapers and business related magazines offer demographic data.

• Library- In the reference section of the library you will find financial data and statistics. Ask your local librarian for help, they will be happy to assist you in finding the information you need. In the library among the references you will find studies by the U.S. Department of Commerce and the U.S. Census Bureau.

• Government Agencies- Your local Bureau of Census publishes the “County and City Data Book” with offers local demographic information. Many state and local offices provide demographic information of the local area.

• Market Research Statistics- There are many websites online that offer statistics for small business market research. Statistics such as Demographics can help you get a sense of population characteristics of your location.

• Trade associations- there is a trade association for just about any industry. There is usually a fee to join but it is an opportunity to network with other professionals in the industry. You will also have access to market research they conducted.

Market Research while Running your Business

Don’t think that once you start your small business, you don’t have to conduct any more market research. Your small business should always be evolving and adapting to the changing markets. Here are some market research techniques to use while running your small business.

• Keep a sales report- Find out what products are hot and what products are not. Certain products may sell more in certain months. Inventory tracking software can help you notice trends.

• Competition- Pay attention to your competition. See what changes they are making. Have they made any changes in recent months or years? Have their products changed? Did they start offering new services? Your competitors may be making changes as a result of the changing market needs.

• Customer Survey- Perform customer surveys to discover what are the customer’s likes and dislikes and how you can improve your business. Be sure not to force customers to fill out a survey. Be sure they know it is optional. You can have a customer suggestion box where customers write their suggestions and put it in the box. You can also find out where your customers are coming from by asking for their zip code when they are about to pay. You may discover that a large percentage of your customers come from a certain area.

Market Research can be an expensive and time consuming task depending on the methods of market research you choose however the information you obtain from it can be very valuable to your business. You can decide to hire a market research firm or do your own market research.