Market research is a key element of business and an absolute necessity when you are just starting out. Regardless of what product or service you provide, research data reveals important information about your target demographic, geographic area and specific customer preferences. Rising above your competition means creating new opportunities by knowing exactly what people want.
Primary vs. Secondary Research
Primary data is customized information. Secondary data comes from sources like trade journals, government agencies and census reports. While secondary tools are useful, they are not specific to your operation. In order to understand your impact and potential within your market, you need to survey, question and interview your audience. These primary research techniques give you more valuable information. Many third-party providers are willing to do the investigation and analysis for you, but with the right strategy, you can easily source this data on your own.
Surveys are commonly distributed through mail, email and web-based providers. Perhaps you want to learn where people shop or what consumers are willing to pay for a particular product. Questions should be clear and phrased in a way that your target sample will understand. Moreover, avoid creating a bias that might skew your results. Consider the following neutral questions:
- Would you prefer to purchase the one-gallon size instead of the two-gallon size?
- How many times per month do you visit a grocery store?
- Would you rather shop at a clothing store in the morning or the afternoon?
Now, use this next set of questions to consider how improper phrasing might influence an opinion or produce an erroneous response:
- Would you prefer to purchase the one-gallon size instead of the heavier two-gallon size?
- How often do you visit a grocery store?
- Would you rather shop at a clothing store in the morning or after work?
Surveying is the most affordable technique for small business owners, and it’s a great way to source new customers. Just be sure to choose a specific target sample such as past customers, a particular demographic group or even random consumers in a city or neighborhood. Most importantly, narrow your focus and design each question around the same business goal.
This is a great method for qualitative data. Targeting current customers with knowledge of your product can help you determine what is and is not working. Alternatively, you can target a random sample to learn more about potential clients. Location is important. If you’re a clothing company that interviews participants at a mall, your sample will probably include a large proportion of people who already like to shop. Alternatively, if you conduct interviews at an airport, you’ll likely have more diversity in your pool.
This is usually the priciest method. A focus group may involve lengthy preparation, rental space and participant compensation. Many new business owners choose to go through a facilitator. Nonetheless, a focus group yields valuable information.
Suppose you’re developing a new kind of software. A survey might tell you about preferences, but a focus group lets you test your applications on real users. Likewise, the owner of an ice-cream shop would benefit more from a taste test than from an online survey. Plus, a follow-up discussion can give you valuable feedback. Participants in a group setting tend to empower each other to be more open and candid.
Where to Start?
Primary market research doesn’t have to corrode your budget. In fact, many owners choose to do the whole process on their own. Secondary data sources can help you hone in on a starting point. Just remember to go through the proper channels, particularly when you are surveying or interviewing in a public setting. Legal advice can also be beneficial and help you remain compliant with local laws and industry regulations.Legal Disclaimer
The content on our website is only meant to provide general information and is not legal advice. We make our best efforts to make sure the information is accurate, but we cannot guarantee it. Do not rely on the content as legal advice. For assistance with legal problems or for a legal inquiry please contact you attorney.