Are you considering starting up a business? To make sure it stands a chance of succeeding among the millions of other businesses, carry out market research first. Creating a market research action plan is a vital part of your business groundwork. It’s great to have a wonderful business idea in your head, but who are your customers?
Don’t fall into the ‘I want to start my business now’ trap. Do your homework first.
It’s easy to get excited because you’ve come up with a brilliant business idea. So, you want to skip the market research part. You’re keen to rush out straight away and register your business. You’ve got the concept, the plan, the brand and your business name. You even know how you want your website designed. Ideas are flowing like water.
However, slow down for a minute. First, lay down the foundation to build your business on. The foundation is creating a market research plan and carrying it out. By doing this you will know who your ideal customers are. You will understand their likes, dislikes, spending habits, problems, needs and how you can best serve them. Carrying out market research will also help with writing your business plan and setting goals.
So, let’s see how to go about starting a basic market research action plan. This is a 3 step action plan. There are a few ideas here to get you started…
- First, put together a list of questions to include in your market research for potential customers and competitors.
- Next, decide how you’re going to carry out the research. This is the source you intend to use. Then, write a plan of who you intend to speak to and the methods and sources you will use.
- Finally, put your answers together. This could be letters/emails, telephone calls made or received, surveys, questionnaires, any business test trading you did as part of your research or other means of research.
- Make a List of Questions for Your Potential Customers
To find out if there is a need for your product or service, ask prospective customers. Going directly to the source is the only way to know if people need or want what you have. You might think you have the best service or product in town, but how do you know for sure? If only a handful of people are prepared to buy your product or use your service, will your business idea be profitable?
Save yourself future headaches, time and money by putting together a solid set of questions for your research. The answers will determine who will buy from you, whether your product or service is of any interest to them and how to make it available for them to purchase from you.
Here are some basic sample questions below:
Questions to ask Your Potential Customers:
- What is your age?
- What is your gender?
- What is your profession?
- What is your household income?
- Where do you live?
- What frustrates you?
- What are you afraid of?
- What do you enjoy reading?
- To go deeper ask about interests, hobbies, opinions, likes and dislikes to get a clearer picture about your customers.
- Would you buy (your product/service)?
- Would you use this service or buy this product?
- Do you buy online or travel to make a purchase?
- What influences you to make a buying decision or use a service?
- What features do you look for when deciding to buy?
- Which benefits do you look for?
- What problems would my product or using my service solve?
- My proposed fees/price of the product is $…. Will you be happy to pay this price?
The source is the place/platform or resources you will use to ask the questions.
- Social media (Facebook or Twitter). Share your intentions and ask your followers to help out by filling in a questionnaire. Include a link to your online survey.
- Speak directly to people on the streets. Hand out the questionnaire for them to complete. Or ask them questions and you write down the answers.
- Conduct one-to-one interviews with potential customers.
- Send emails/letters to your contacts of possible potential customers.
- Ask friends and family members for their opinion of your product/service. Give them a questionnaire to complete. They may even be interested in buying your product or using your service.
- Use online surveys such as Survey Monkey. This is quite popular. It’s free and easy to set up.
- Google Forms is another free online survey platform. First, you have to set up a Google account and log in to send surveys. You can send the surveys by email, if you prefer.
- Hire a company to carry out the market research. If you have the funds, use the service of a market research agency to work on your behalf. Do a Google search for market research agencies to find one in your location.
- Hand out questionnaires at colleges and universities. This will depend on the product or service you’re selling and the age group you’re targeting. Alternatively, hire students on business courses to conduct your market research for a minimal fee.
You can use these methods to gather other necessary information you need. These will not cost you any money either.
- Visit your local library and go to the business reference section. Ask the librarians to show you the best business resources for your target audience, related to your brand. You can even check out your competitors while you’re at the library.
- Search the internet. You will find a lot of information online. In your research stage, you may need to identify industry trends, obtain access to business databases and read the latest business news. Use the information gathered to identify prospects and plan your marketing strategy. KnowThis.com is an online marketing virtual library packed with all things marketing related.
- Read trade association magazines. These are full of valuable information about the buying patterns of consumers. In addition, you’ll discover present and future trends of potential customers within your field. Subscribe to get the latest trade magazine or newsletter.
- Contact your local Chamber of Commerce. They will provide free demographic reports and directories of local businesses.
- Compile Questions to Find out About Your Competitors
Study your competitors to understand how they function. This will make you one-step ahead. Do this right and you will learn about their best practices, customer service and also identify their weaknesses. After analyzing, create a unique USP (unique selling point) to make your service/product more unique.
Create a list of questions to help you analyze their product or service. This will give you an insight into how they operate.
Here are a few to get you started…
- What services or products do they offer?
- How do they market their services or product?
- How much do they charge for their products?
- What are the fees for their services?
- What are their strengths and weaknesses?
- What is their elevator pitch?
- What results does their product or service offer?
- Visit their website. This contains a valuable source of information. Read their home page, about page, service page, mission statement, contact page, product descriptions, blog articles, case studies, free downloads and reviews plus other relevant content.
- Look them up on social media and read their blog articles. Discover interesting facts and trends about your competitors from monitoring their Facebook, Twitter or LinkedIn accounts. Read their Facebook updates, tweets and blog posts. Collect information from the content they provide for their audience.
- Attending conferences is a great way of getting a peek into what your competitors are doing. Watch them in action. Collect their brochures, leaflets, business cards or other marketing materials. Take note of how they interact with their customers.
- Visit your competitor as a customer and try out their product or service. Get a feel of their customer service. Moreover, check out the quality of their products closeup.
- Speak to their existing customers about the benefits of using their products/service. Be upfront. Tell them you’re doing market research and you would appreciate their opinion.
- Ask someone you know to become their customer and give you feedback. This is similar to a mystery shopper experience. They visit the competitor’s store or use their services and give you a detailed breakdown of their observations.
- Gather the answers and record the data.
Armed with all that wonderful data and information from your market research, you’re ready for the next step. Put it all together. This will become a vital part of your business plan. Create a spreadsheet in Microsoft Excel to record the answers. Or upload the data online to Collate Box.
Starting up and maintaining a successful business means investing quality time before and after you’ve launched. Guesswork will not develop a flourishing business. You have to work on your business before startup, during the launch and while it’s up and running. It’s an ongoing process.