Being a business owner is more than just running a business and ensuring your books are balanced, it’s also about doing research. You have to research suppliers, manufacturers and most importantly you have to research your market.
Market research is defined as the process of evaluating the viability of a new service or product through research conducted directly with potential customers. Market research allows you to define your target market for your new product or service and get feedback from potential customers.
If you are a business owner, proper market research can help you with so many things. Not only does it help you test the viability of your new product or service, but it can also give you insights into how your customers are towards your brand.
In this article, we will take you through the concept of market research and how it can help your business.
How Does Market Research Work?
So basically, the main point of doing market research is to test out a new product or service to see if it will be viable in the market. The results you get from your investigation can be used to change the design of the product or service and fine-tune the strategy of the product or service.
Another advantage of doing proper market research is that you will also gain insights into your customers’ buying behaviour, see how your competition is doing and see where you need to change your business.
To complete your market research, you will need to do a few things before getting started. You need to gather information on the target market for your new product or service. From this information, you should be able to identify relevant data points which will guide you on elements such as product design and how to market it to your target consumer.
You can conduct your market research in many different ways including product testing sessions, interviews with potential customers, surveys, and focus groups.
Now, this is just a small outline of how these investigations work. Going further we will look into the two elements which make up market research.
Primary vs Secondary Market Research
Market research is typically a combination of primary and secondary market research. Primary research is the research that you do yourself or the research that is done by a company you hired.
The primary research you do will fall into two categories: exploratory and specific research.
Exploratory research is less structured and is conducted via open-ended questions. You can pose the questions in focus groups, telephone interviews or questionnaires. The questions must focus on the product and any issues you want to address.
Secondary market research includes information which is already available. This is research from the government (census data), research reports, polling results and results from other businesses within the same sector.
Conducting Your Own Research
The first you need to do when doing market research is to outline what the goals of your study are. The study should seek to find answers to a problem you have identified. This problem can be how your product or service works, the branding or the application of the product or service.
Once you have outlined the details of your study, you need to figure out who you will include in the research. Because this can be an expensive process, you need to decide beforehand what type of consumer you will include, and how the data you need will be collected. You will also need to account for the possibility of statistical errors or sampling bias.
The next step is to collect your data and analyse the results. If you have done your preparation properly collecting and analysing data should be easy. Whoever is conducting the invesstigation needs to collect the results of the research, and keep track of variables such as age and gender and any other relevant data of the respondents.
All the consolidated will then be analysed and put into a comprehensive report that explains the results of the research.
Lastly, you will take a look at the results of the market research and use it to make informed business decisions. Depending on your result you may need to make changes to your product or service or maybe reconsider your target market. Additionally, the results might show you that the market is ready for your product.
Now that you have all this information you can start the process of conducting your own market research. If you believe you can do it yourself then start today! If you need help, you can find various market research companies online.
For help with business planning such as market research, visit SME Advice to speak to one of our experts.
