Understanding of social, cultural and economic context in which you’re trading is crucial and it makes no difference what sector you occupy. You’ll need to know about the local area, what your competition is, and what people will be prepared to pay for your product or service. But understanding your market provides a set of benefits for you.
Market research for small business will help you to understand your customers, familiarize yourself with the competition and get to know what people are prepared to pay for your product or service. A market research aims to understand the reasons consumers will buy your product. It studies such things as consumer behavior, emphasizing on how cultural, societal and personal factors influence that behavior.
Generally, successful businesses undertake market research for small business on a regular basis to achieve several results. They are aimed at:
● identifying potential new customers
● learning more about existing customers
● informing their decisions regarding existing and new products or services
● better understanding their competitors
● testing new markets
● identifying performance, pricing or promotion opportunities
Market research can be split into two varieties: primary and secondary.Primary research studies customers directly, while secondary research studies information that others have gathered about customers.
‘Primary research’ refers to information gathered from original sources such as:
● face-to-face interviews
● focus groups
● customer feedback
● online polls with randomly selected members of the target group
‘Secondary research’ is information and data that has already been collected and analyzed by other sources such as:
● industry and trade publications
● social media and websites
● marketing and consumer lists
The types of information you collect through these sources may be quantitative or qualitative.
Qualitative information measures the values, attitudes, and views of a particular sample. This type of information is useful if you want to understand why people buy your products, how they respond to your advertising or their perceptions of your brand.
Quantitative information is based on statistics and may be used to predict market penetration, future earnings etc.
There are basic questions you’ll need to answer when performing your market research for small business:
Who are your customers? Try to take into account their age, occupation, income, lifestyle, educational attainment, etc.
What would they like to buy? Describe their buying habits relating to your product or service, including how much they buy, their favored suppliers, the most popular features and the predominant price points.
What is the purpose of their buying? This one may be very difficult to answer because it’s impossible to get into your buyer’s head. But try to suggest a set of motivators for them to buy your product or service.
What will make them buy from you? Although some of these questions may seem difficult, you’d be surprised at the detailed information that’s available about markets, sales figures and consumer buying motivations.
Market research for small business requires significant amounts of expertise, manpower, and technology to develop solid research. Large companies routinely spend an impressive amount of money researching things they
ultimately decide they’re not interested in. Smaller firms can’t afford to do that too often.
For companies of all sizes, the best market research is the research you do on your own. In-house market research might take the form of original telephone interviews with consumers, customized crunching of numbers from published sources or perhaps competitive intelligence you’ve gathered on your rivals through the social media. You can gather detailed research on customers, including their likes, dislikes, and preferences, using social networks, and use Google Analytics to sort out the numbers as they pertain to your web visitors. People are researching and making their opinions felt through their actions on the web, so you can gain a lot of marketing insight by looking closely at what is going on electronically.
When doing a research it is important to keep a small secret in mind. It is significant not to allow your opinions or preferences to affect your research. Having a prejudiced idea of the results will bias your research and provide false information. Remain open minded and be prepared for unexpected results.
When processing data make sure you:
● keep your market research objectives in mind
● categorize data according to what is most relevant for your business, don’t become sidetracked by information that is just interesting.
● collate your data using tables or lists to make it easier to identify certain trends and themes.
You may need to collect additional information if your results are inconclusive. Analyzing the data should allow you to draw some conclusions regarding your initial objectives. Update your business and marketing plans with the information collected from your market research also use business consulting tips.
Tools and tips for effective market research for small business
If you want to make the best use of market research, here are five key points to bear in mind:
1. Start researching in advance
Do your research before you begin trying to sell in a new market because it gives you a possibility to know the potential success no matter whether you’re selling locally, nationally or globally.
2. Make your research low-cost
We have already mentioned that market research requires certain financial investment which may turn into a problematic issue for small businesses as sometimes they can’t afford to splash out on expensive
research – and luckily they don’t have to. Small focus groups and surveys of your existing customers can be effective and inexpensive.
3. Use existing research
Someone may have done the hard work for you already. Check out online reports, field reviews, and magazine articles.
4. Be aware of public attitude
Nowadays, probably, there is no a sphere which is not influenced by the world wide web. The internet makes it easy to find out what your potential customers think. Read consumers’ blogs, watch their YouTube videos, vlogs, and check out discussion forums and social media.
5. Use the cloud and big data
Companies such as Google spend vast amounts of money collecting research. Take a look at Google Trends and Google consumer surveys. Google Trends will let you see what people are searching for. Google’s findings are often free, so make use of them.
As soon as you have a combined strategy that includes your own intuition and customer feedback, market research will be able to help your business perform better and enter new markets successfully.