In order to start a successful small business or launch a new product or service, you need to know what you are up against. This means that you need to do all that you can to learn about your particular industry, the companies you are competing with in that industry, and the customers who purchase products and services in that industry. Gathering and analyzing this information in order to make your business better is called market research. Doing proper market research can help you reduce risks in your business and identify trends and development opportunities.
Before you begin conducting your own market research as a small business owner, it is important to take the following steps:
- Find out what has already been published about your market by third parties. These can include trade magazines, academic institutions, and other reputable sources.
- Research published government statistics about your particular type of business or industry. These statistics can give you a great deal of economic information such as income statistics and economic indicators.
- If your business deals internationally, you need to seek out resources that will help you understand the global market. The US government publishes data on trade issues and exporting, so you will definitely want to take a look at that.
Once you have gone through the previously published market analysis materials, here are some market research tools you may want to consider using the following to garner information about your particular customer:
- Focus groups to get direct feedback from potential clients
- Interviews (either face to face or by telephone)
- Surveys & Questionnaires (this can be done by phone, mail, email, or even through an online service like Survey Monkey)
When you question potential customers, you will want to find out what they like or dislike about the current product or service offerings in your market, what they are willing to pay for a product or service like yours, and what drives them to purchase (or decide not to purchase) a particular product or service.
However you decide to conduct your market research, make sure that you use both primary (field) and secondary (previously published) research, that you use a mixture of online and offline resources, and that you survey more people than just your family or friends. Take your market research seriously, and it will pay dividends in the future of your business.