Market Research for Entrepreneurs
Large corporations are able to allocate huge amounts of money for market research. They understanding the importance of understanding your target market in order to successfully communicate with prospects and customers. For most small businesses, this level of research would send them broke before they even get started. This is not to say the same principles can’t be achieved in a smaller scale.
What are the hidden motivators in your target market?
If you are an industry expert and think you know exactly what your prospects’ need or want, you could be very wrong. People who attempt to ‘guess what the market wants’ risk losing their entire investment. The best way to obtain reliable information you can use to market your business may simply be to ask these two questions:
- Why did you buy from us the first time?
- What keeps you coming back to our business?
- What would you improve in our business?
Even if you are new to business and haven’t got a customer base to draw ideas from, you can always invest in your own research. Brainstorm with anyone and everyone you can, particularly if they are within your target market. Ask other entrepreneurs or creative thinkers their thoughts and experiences regarding your proposed venture. External perspectives are always valuable since we can often get too close to our own projects and lose sight of the bigger picture.
Market research surveys
A highly recommended way of obtaining market research is to prepare and conduct your own survey. With your own survey you can manage the information you choose to obtain. A good way of motivating people to participate is to offer incentives for completing your survey.
Doing research via surveys will help in many aspects of your business such as customer relationships, business systems and defining your target market. You can use your current customers as case studies and discover who your future customers will most likely be.
Simple questions can be used to obtain demographic information from your customers. If you give a reward to people who complete the survey, you will significantly improve your response rate and quality of information obtained. Incentives will vary depending on your market. A reward with a high perceived value will produce the best results. The cost of giving rewards should be considered an investment since the information obtained should help generate more sales if used effectively.
Existing businesses can research their target market by analysing their database of current and previous customers. Running a Customer Relationship Manager (CRM) system. The value your CRM provides will be directly proportionate to the quality of information you have added to the system over a period of time. What you put in is what you get out.
Check out your competitors
To expand on the knowledge you gain from surveys and your database you should then study your competitors. Is there a highly successful business in your industry? Find out what makes them so successful. You should try to get your hands on as many brochures and other sample material as you can. This will allow you to study their brand(s) closely and analysis their marketing messages. Websites are easily accessible and often give you insight into your competitors’ strategies. This is not so you can copy what they do; actually it may be quite the opposite. You may find opportunities your competitors have missed.
