You’ve come up with what you believe is a sure-fire idea for a business. Your friends and family agree. So therefore it must be a stellar idea! Unfortunately gut instinct, passion and the enthusiastic support of those near and dear aren’t always enough to guarantee success or protect you from potential risks.
Before you jump in the deep end, it pays to sit back and take stock of what you’re jumping into. Questions need to be asked and several big boxes (plus quite a few small ones) must be ticked if your business dream is to become a profitable reality instead of an expensive nightmare.
Market research is absolutely critical for a business start-up as it helps you discover:
Market research helps you understand what people want, need or believe. It can tell you how your target market behaves and what motivates them to buy. It gives you invaluable information, data and insights for creating your all-important marketing plan.
Your market research should answer any questions or uncertainties you have about your business idea and provide some great feedback and insights into the industry. Some key questions to consider:
Take your time with market research as it is a large task and something that you need to get right if you want success. Get started by checking out:<
Your research should aim to find out what your market needs, wants, doesn’t want, and why. Your goal is to build a demographic profile of your customers so you know how to market your product or service to them.
Where and if appropriate (keeping in mind that you should protect your idea and not give too much away just yet), you could use a succinct written description of your service or product, photos, your prototype if you have one, your marketing materials, plus any other useful aids to help people get a clear idea of what you’re offering.
Prepare concise and straightforward questionnaires that analyse the needs and behaviour of your target market. The more people you ask, the better quality the information you get back.
2. Focus groups
These are run by a moderator, who uses a scripted series of questions or topics to lead a discussion about issues related to your product or service.
People don’t always tell the truth in surveys and focus groups, with their answers sometimes at odds with their actual behavior. When you see people in action by watching them in stores you can find out how they really buy or use a product.
4. Personal interviews
Like focus groups, personal interviews include unstructured, open-ended questions. Personal interviews provide more subjective data than surveys. The results are not statistically reliable, which means that they usually don’t represent a large enough segment of the population. However, like focus groups, interviews can give valuable insights into customer attitudes and are excellent ways to uncover issues.
5. Field trials
Placing your product in selected stores or your service with an agent or representative to test customer response under real-life selling conditions can help you assess its chances of success, make product modifications, adjust prices, or improve packaging.
As well as determining if your business idea is a good one and helping you to develop your marketing plan, your research findings could help you get others on board, such as a financial partner or specialist supplier. A positive research outcome could also help you get your partner and others over the line and in full support of your venture.