How To Do Market Research For Any Business Idea
People come up with thousands of creative business ideas everyday. While some may be focused on solving small problems in a market, others are highly focused on gigantic, or primarily big picture achievements.
The problem with coming up with business ideas isn’t in the idea itself, but in somehow quantifying not just the number of people who may need that product or service, not just the number of people that would eventually use the product, but how best to convert the bulk of your prospects into actual paying customers.
So Why Is Market Research Important?
Part of the core essence of market research is to help you know if you have an existing competition, if someone has tried your business idea previously and failed, what it may take to get people to accept your business concept, and to determine if you’re darn sure you’d be willing to put in long hours, and even years of hard work, before you see any form of positive returns on your investment.
Before you think of spending a dime on your business idea; whether in mass producing a certain product, renting an office space, or spending millions promoting what you’re not fully certain anyone would even purchase, you need to run your business idea through a series of market research elements to ensure you’re on the right track.
Although some people start new businesses without carrying out any form of market research and end up successful, on a general scale, not implementing a detailed market analysis for that new business idea could tank your investment.
Here Are 7 Ways To Do Market Research
This mostly involves talking to people face to face or over the phone. Here you get to measure the person’s physical reaction to your business idea, and also be able to see how badly they want or don’t want the product or service you’re trying to pitch to them.
Carrying out surveys online or via mail, is a way to get people’s reaction to your product or service on a large scale, which would subsequently be reanalysed to determine what they may rather respond to or not. By doing surveys, you collect quantitative or numerical information, and qualitative or descriptive information.
While questionnaires may seem similar to surveys, they’re not. Surveys are a general view, examination, or a description. It’s majorly the experience of a group of people, based on a series of information. While questionnaires are a series of printed questions, usually with a choice of answers, sometimes online.
Using questionnaires for your market research in say, a university, can get you some partially true answers from people about their thoughts on your product or service.
4). Focus Groups:
This involves gathering a small number of prospects, customers, and even off-product consumers to get their contained feedback on your business idea.
By narrowing your focus to these small test subjects, you increase your chances of identifying some really small unnoticeable issues that could have been easily overlooked. You also get to understand some views in a very personal manner, based on the close-watched short-term experiences of the test subjects with your proposed product or service.
5). Social Media:
The advent of social media has done nothing but increase the market-reach potential for any marketer or brand expert looking to carry out some detailed market research on a business idea.
Through social media, you could pose questions directly to groups of people to get their immediate reply. You could maybe post the link of your new website or product page to a group page on Facebook or LinkedIn, asking for feedbacks. With the activity level of individuals in groups lately, especially LinkedIn groups, you’d more likely get some results.
Harness the power of social media in your market analysis to maximise your result potential.
6). Free Market Data:
Free market data are usually information based off of already done research lying around the internet, a library, or some facility to be picked up. Some government institutions, private companies, university researchers, and more, carry out detailed market research, and put their findings on the internet for people to learn from. These market research reports can help you gather more intense findings that’d help you quantify how viable your business idea truly is, in its proposed launch community.
7). Market Research Companies:
Another great but expensive route is to use market research companies to test the viability or non-viability of your business idea. Market research firms can use more intense methodologies like neuroscience for instance, to determine how people’s brains react to the sight, sound, smell, or touch of your new product or service.
Working with a market research firm to test your idea doesn’t just give you more confident results, but greatly reduces the market research process for you personally.
Key Questions To Answer From Your Market Research
1). Does Your Business Idea Solve Any Real Problem?
If your market analysis shows you that your business idea doesn’t solve any real problems people in your
intended local community experience, then you must immediately either change the business idea, or you try another community.
2). Is it a ‘general’ problem, or is it specific to a particular type of people?
How wide is the potential size of the market for your business idea? Is it global? National? Or really small? If the size of the market does not have the potential to sustain the business for a long-term profitable and massive growth, then you should find something else to do.
3). Are your test audience really honest about their feedbacks?
Are you testing your family and friends, or the right people? Are their responses genuine?
Testing the right audience is totally important to the success or failure of your market research. You must ensure you test only those that have no personal or emotional connection to you, for optimal results.
4). Are there any related problems you could solve?
In the course of carrying out your market research, did you realise any related problems that the prospects need solutions too? A business idea gets even more lucrative if it opens up related opportunities. If you realise there are none, there’s no need to panic.
If the idea already proves itself from the market analysis, then it could be a good bet. After you’ve started out, you may more easily spot related problems better than you initially did or didn’t.
Common Market Research Problems
1). Biased Surveys:
Some surveys can be rendered unproductive, due to the level of bias put into it. Marketers may create a
survey about a certain product, but make the questions be more inline to the natural characteristics of a particular type of people, when the survey was supposed to cover as many kinds of people as possible.
2). Poor Survey Design:
When a market survey is not properly organised for a thorough market analysis to be effectively carried out, most of the results would be total fallouts.
For example, a market research company may organise a market survey for kids who sleep during a class lecture, but run it through all the kids in the school. The problem with this survey is that a lot of the wrong kids that don’t qualify would take part in this, and end up making the results practically worthless.
3). Nonresponse To A Survey:
Even after preparing a perfect market survey for a test, people may still not respond to it. While this is a problem, it’s important you master your emotions. Take a few steps back, identify what the problems are, adjust, then try again.
When things don’t workout the first time, you haven’t failed. You only found a way that doesn’t work.
4). Relying Only On Published Works:
Relying only on third party research work opens you up to many problems. You could either be basing your analysis on what worked in an entirely different market, or on a research that is greatly flawed.
Carrying out your own market research would give you the most accurate results possible. This is important because you don’t just control the research, but you also ensure that it adheres to highly accurate and strict standards.
5). Basing Your Research Only On The Web:
The web may be a great resource for market research reports and market analysis to be carried out, but it is not enough to show if consumers really want your products and services. Every successful market research always has a good physical element to it.
Watch how people respond to your business idea, ask questions and get live feedback, have neuroscience help you better determine what people want that they’re not even aware of. As long as you’re detailed enough and carry out all the best market research methodologies, your report will produce accurate results.
Don’t let the excitement of a new business idea cloud your judgement, that you then avoid the market research process. While there are success stories of entrepreneurs who founded companies out of business ideas that were based on a hunch and not rational facts, doing a good market research before you spend a dime on your business idea, would save your potential future investments from going down the drain.
“It’s better to be safe, than sorry”.
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What are thoughts on how to do a market research for any business idea? Let me know by leaving a comment below.
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