In 2021, the global revenue of the market research industry exceeded $76.4 billion, a growth of more than twofold since 2008. The annual growth of global market research revenue is 0.3%. It is great to have an idea that expects to capture the hearts and minds of consumers everywhere. Perhaps stumbling upon a service not offered by anyone else, hopefully, a service or product that is desperately needed might be the opportunity to start a successful business.
However, before venturing into something, determine whether there is a need in the market for the product or service. Ascertain the needs and demands of the consumer by conducting market research and finding out if your business would be successful.
Market research, a crucial step, is neglected by many business owners in product development. The sole reason to do so is to avoid any negative feedback regarding their business idea. Other entrepreneurs skip this process because they foresee it to be too expensive and time-consuming. However, you shouldn’t skip market research as it is an integral part of starting a business. To make it easier for all the entrepreneurs out there, here is a list of processes for doing market research.
Market Research Methods
In Primary research, we gather information directly from the source i.e. the potential customers. Secondary research is the gathering of statistics regarding things related to the business or reports, studies and other data from organizations such as government agencies, trade associations and the local chamber of commerce.
The vast majority of research that is conducted is secondary research and the best way to look for that would be the following.
- A local library or the Internet
- Reference libraries at public disposal or university libraries
- Industry trade Associations
- New magazines and newsletters
- Government Guidance
- Community Organizations
Apart from this, an in-depth understanding is required of what’s essential to any business plan along with appropriate points for the venture to ensure the success of the startup.
Market research aims to understand the reasons how and why consumers will buy a given product. It studies such things as consumer behaviour and consumer’s decision-making process, including how cultural, societal and personal factors influence that behaviour while buying a product.
4 Questions to Ask For
The basic questions we would try to answer while conducting market research are:
- Who are the customers of the business?
- What do they generally prefer?
- Why do they prefer a certain product instead of the new product or services being offered?
- What will make them consider the product being offered?
How to Compare Data Collected?
Try to search for the closest match to the business for comparative analysis and consider these points:
- Companies of relative size and budget
- Companies serving the same geographic area as the proposed startup, which could be global if it’s a web-based business
- Compare with the companies with a similar ownership structure. If your business has two partners, look for businesses run and managed by a couple of partners rather than an advisory board.
- Companies which are relatively new and have started functioning recently because long-standing businesses are successful because of their 25-year business history and reputation.
How to Spend Your Money on Market Research?
Follow these steps to know how to spend your money on market research wisely:
- Determine what is required in the target market before starting up. The more focused the research, the more valuable it will be for the business.
- Prioritize the results carefully and closely for accurate data. It is obvious, you can’t research everything, so concentrate on the information that will give the best or quickest outcome for the business or startup.
- Review less-expensive research alternatives to save money. Small Business Development Centers and the Small Business Administration can help develop customer surveys in a better way. The trade association will have good secondary research and try to be creative as well as innovative.
- Estimate the cost of performing the research yourself to ensure accuracy and prevent overspending. Keep in mind that, while using the internet, spending a lot of money would not be necessary. Don’t pay for what you don’t need at all in the business.
You need to consider your target audience and figure out your marketing platforms. Also, you should be aware of the latest trends and updates in your industry. Keeping these points in mind will ensure thorough market research for starting a successful business. Share this post with your friends and drop comments.
How to Do Market Research for a Startup?
- Look at the Entire Industry and Potential Market.
- Analyze the Market Audience.
- Gain Insight into Top Companies' Product and Digital Marketing Strategies and Tactics.
What are the market research tools for startups?
Tools of market research:
- KNIME Analytics Platform
- Facebook Audience Insights
What are the steps to do market research?
The 5-Step Marketing Research Process:
- Define the Problem or Opportunity
- Develop Your Marketing Research Plan
- Collect Relevant Data and Information
- Analyze Data and Report Findings
- Put Your Research into Action