This article ‘four vital aspects of market research most entrepreneurs forget’ was posted in Forbes by Joe Gardner.
Kindly go through it and again a business insight that will help you become a better entrepreneur.
“Market research is at the crux of every successful business. It’s how founders first gauge whether people actually want their solution, product or service. It’s also how they determine if other companies are already filling that need (and if they’re doing it well).
It’s a matter of using data to quickly determine if there’s an opportunity. And, if so, how do you win?
A huge reason companies succeed is because they utilize research to find this market fit. (And it’s one big reason founders are able to bounce back even after certain ventures flop; market research allows you to fail and learn quickly.)
At the same time, one big reason companies fail is by overlooking the importance of conducting market research at all, or misunderstanding how, exactly, to do it. The fact is, market research isn’t just a matter of Googling the competition. If founders only take that approach, they end up building something they may believe in but there isn’t actually any demand for.
Don’t let this happen to you. Instead, focus on these key elements of market research. They will give you a foundational understanding of your opportunity and of the potential of your idea; an understanding which, ultimately, will give you the information you need to make an informed decision regarding which direction you take your idea.
- Run basic ads and polls.
Market research cannot start until you connect with your target market.
One simple way to do that is by running basic ads (think Google Ads or polling) just to see if people click. Of course, you’ll need a landing page or two to direct your audience, so make sure you have those in place first.
The goal here is to determine whether people seem to be intrigued by your offering. Study the stats. What’s the click rate? How are people responding to the ad? Though it might seem rudimentary, this is feedback from actual people within your market that can allow you important insight — not just what your gut tells you.
- Try guerilla marketing.
That’s right: marketing in which you actually venture into the world and engage with people who are likely to be interested in your product. If this strikes you as old-fashioned, that’s because it is. But it also works.
A great example of this comes from a friend of mine who founded a successful dog-walking startup. He and his co-founders moved to Los Angeles from the East Coast and started enjoying the nice weather and healthy lifestyle, including hiking. In fact, it was on those frequent hikes when they noticed the number of people hiking with their dogs and thought there might be a business opportunity there. So, they printed some flyers and went to popular hiking areas to personally speak with people, collect feedback and share information about their idea. Once they realized people had a need for dog walkers and loved their idea, the business was born.
Even if the product itself is not yet ready, the research you conduct can provide you valuable insight into your potential viability, and you should never be too proud or afraid to roll up your sleeves and do some good old-fashioned groundwork yourself. Connecting directly with your target market is one of the most valuable things you can ever do to understand their needs.
- Tap into social media.
Social media is famous by now for its marketing potential, but it’s perhaps an even more valuable tool for conducting research.
Running advertisements on social media allows you insight into who your target market might be simply by way of who clicks on your ad. The demographic information is pretty specific. Run the right kind of campaign, and you can walk away from it knowing your core demographic for your supplement company might be, for example, males between 20 and 30 years old. That’s critical information to have.
- Collect letters of intent to start building a user base through the approaches you take.
While you’re pursuing these various tactics, it pays to be collecting user data and contact information along the way. That way, if you find people excited about your company, you can contact them later on when the product or service comes more into fruition. After all, you don’t want to lose those potential clients or users.
For B2C companies, this typically involves basic data collection, like emails or social media accounts. But for B2B companies, there is an additional step I always suggest doing if possible: Get the company to sign a letter of intent (LOI). If you pitch someone on your concept, or if someone during your research shows interest in your idea, ask them to show you some kind of commitment, too. It’s easy for someone to say they love your idea and can’t wait to be a client. But when asked to sign their name to a piece of paper, even when the LOI is completely non-binding, you might see a different response.
The earlier you can get started with all this, the better.
As I mentioned above, market research is something you need to conduct in the foundational stages of your company-building experience. The earlier you obtain the key information this research allows, the less expensive your failures, and the better you’ll be able to tailor your product to a specific, target demographic.
Plus, it just makes sense. In terms of build order, what you learn through market research will invariably inform everything you do next, along with how you go about doing it. Adjusting in the initial stages of ideation is much easier than pivoting further down the line. And your findings might cause you to get started on a new idea instead — one that people seem to want even more — before investing time, money and effort into building a company that doesn’t have market viability or has little demand.”