3 Market Research Tips for Startups

3 Market Research Tips for Startups

3 Market Research Tips for Startups

Every startup business contains a great idea that was envisioned by the entrepreneur. It all seems well and fine, yet so little startups survive the initial launch. Then the business owners wonder why?

The idea was great, the planning and budget were on track – everything was going good, and then, before you knew it an "out of business" sign was placed on the door. Something had been overlooked or ignored, one important step that seemed irrelevant at that time – research.

Most entrepreneurs think that with a good product and solid budget, they can launch a startup with ease. However, it isn't quite so simple. The market is a competitive and crowded place; no matter what your idea is – someone else might have had the same idea before you. That is why it is of the utmost importance to do your research before you launch a startup business.

Step One – Primary Research

This type of research is very important, and also you can do it yourself. There is no need to hire a professional assistance if you don't want to or if you are on a tight budget.

  • Scout the market about the same or similar products you'd like to sell. Check how well it's doing on the market and what's the demand for it. That way, you will know if your product will make a killing out there on the market or it will be ignored.
  • Check out your competitors. What are they doing right and what are they doing wrong? Find a "chip in their armor" so you can exploit their weakness when you enter the market. It's important that you find out as much as you can. Their marketing strategies, their customer relations, everything you can. This will give you an opportunity to stand out and put your competition to shame.

All of this research is free if you do it step by step yourself. It will only cost you time and effort, but you can spare those if you want to run a successful business.

Step Two – In-Depth Research

Once you have conducted your primary research, it is time to get in close and personal. Now you must focus on the customers themselves. You must get to know them as if they were your best friends. Understanding your target audience is important because they will be the ones buying your products. You must attain and hold their interest in order to turn a profit. Here are some methods you can use to gain that information.

Personal Surveys: Write your own set of questions that are closely related to your business. Give them out to your customers in person, and gather data from their answers and reactions. You can also try one-on-one interviews if you find someone who is willing to participate.

Social Network Discussions: You can start a pole on Facebook or Twitter, targeting your potential customers. Gather data from answers you collect. This method can also include forum discussions and online focus groups, like Google Hangouts.

Online Surveys: With this method you can gather the best data you need. By asking the right questions, online paid surveys can provide first-rate feedback. However, the quality of the data you collect depends on the quality of the questions asked. Make sure you ask relevant questions in order to get relevant answers. It's vital to your statistics.

Step Three – Data Analysis

Now you are sitting on piles of raw data which you can use to create an awesome marketing plan for your startup business. Not only that, but you know who your competitors are and how they operate. You know how best to approach your customers and draw out their interest. At this point, you can run an analysis of your success rate. Either you will proceed with the startup launch, or think of a new idea and start over. You haven't started yet, so you have nothing to lose if you have to come up with a new plan.

Now you understand why it is so important to do your research. To know what and who you are dealing with. It's always better to know your limits than to test them out blindly. If you could invent a self-replenishing mug that refills any liquid you put in it as soon as you drink it – then you wouldn't need any of these tips. But, you're not a wizard Harry? Are you?

Posted by Nate Vickery

Nate Vickery

Nate Vickery is a business consultant focused mostly on SMB marketing and management. Nate is the editor-in-chief at one business blog - Bizzmarkblog.com. You can follow Nate @NateMVickery

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