How to do a market research step by step!
The ultimate goal of a business to cater to its clientele’s needs in order to gain profits. As a small business owner, your aim is to detect, understand and address those needs to the maximum of your abilities and resources.
We have previously mentioned in our blog, how important it is to comprehend your customers’ needs and expectations. When you reach that point, the next step is to offer them quality products that differentiate from the competition coupled with top quality customer service!
Either you’re just starting out or looking for ways to grow your company, one of the most important things you need to do is market research.
In this article, we are going to discuss the basics of marketing research, how to do it and why it is important for your small business.
What is online market research?
Market research is, first and foremost, an ongoing process that every businessman should pay attention to in order to avoid becoming obsolete or outcompeted. Its aim is to give you a clear picture of what the needs of the market are, what kind of products are currently out there and how you can make profits by utilizing this information.
Therefore, it can help you find a “market gap” which your company can fill in, either it’s about an improved product or a much-needed service that no one else seems to be offering.
Why you have to do a market research
If your small business isn’t new, online market research can help you decide whether you need to make changes in your product, refine your customer services or add new ones to better answer your customers’ needs.
Inevitably, market research may urge you to tweak your business and marketing plan and help you determine your current plan’s success.
Therefore, doing an online market research correctly can lead you to transformative changes or steer your business towards the wrong direction if done poorly.
This is the reason why we gathered all the necessary steps you need to follow in order to get it right and help your small business grow!
#1 Discover your target audience
Before launching any kind of product into the market you need to know who your customers are. Do a secondary market research and collect data about your market segment’s demographics, lifestyle, age group and buying patterns etc.
Use the market research results to configure your products or services and determine the medium by which you are going to approach this market segment.
Moreover, this data will help decide your pricing and promotional strategy. For example, if your small business’s trade is something that will probably interest the 18-24 group you can’t possibly price that product or service too high. You need to consider that at this age most youngsters live on temp jobs or family allowance. Also, this is a group that tends to buy online via Facebook ads. Make sure your marketing strategy aligns with those facts to get the maximum results from your efforts!
#2 Research the competition
While doing your online market research, don’t forget to gather information about your direct competitors. It is very important to spot their strong points and learn from them. Do they offer a cool service that you don’t? Try to come up with something similar, provided that your budget can support it.
Most importantly, discover their weaknesses and find ways to cover the gaps they create.
The most common marketing strategy followed is coming up with innovative ideas to better serve a market segment’s needs whose needs have been poorly addressed by other companies. Always remember that a small business is a lot more flexible than a big company, so don’t be afraid to compete against big brands!
This could also include promotional weaknesses. Sometimes companies have an overall decent product/service but lack in effective promotional activities. In other words, they cannot reach out to their clients and their products fail. Don’t fall into the same trap!
Market research will help you identify those weak spots and use them to your advantage, so pay attention to details!
#3 Research your existing customers
If your business isn’t new this means you already have a customer base that represents your target market segment. You can conduct a market research survey to analyze how your customers perceive your business, how was their experience, and whether they think your pricing is fair.
You’ll end up having crucial feedback from the people that matter the most to your business and not some arbitrary statistics that you find hard interpreting. There is a number of ways to do this primary research:
- Interview them: This can be done over the phone or in a meeting.
- Survey them: Create an online survey and send it out to your mailing list
- Questionnaires: Send them out online or via post.
Now, sending out surveys and questionnaires won’t get you the data you need if the response rate is low. To make sure your customers will take the time to participate, the following guidelines should be followed:
- The questions are short, to the point, and of interest to the respondents
- It’s two pages long maximum
- If you send it via post, include a Postage-paid envelope.
- Give them an incentive to complete it. For example “Get a free 30days trial of our new service”.
- Include a cover letter explaining why you’re conducting the market research.
#4 Choose reliable sources of information
Your online market research must be based on solid data and there are plenty of verified sources you can get it from. You can search for publicly available data that the government provides which is the most wide-ranging of sources. You can find those in public and university libraries.
Moreover, trade organizations, banks, and other financial institutions offer a variety of statistics that can be useful market research data. Those are usually found in journals, newspapers, and online. They will provide you with demographic profiles, economic trends, and other commercial information.
Marketing research will take your business to the next level!
If you follow those 4 easy steps you’ll realize for yourself how important doing an online market research really is. However, if all the above seem like a lot of work, keep in mind that you can always outsource this task to a qualified professional! By the end of it, they will be able to consult you and help you make all the right decisions for your small business’s well-being.
Do you have a market research success story? Feel free to leave a comment below with your experience!