Market research is an essential part of a business plan or developing a new product or service. By doing market research, you can:
- Confirm or deny that there’s a need for your products or services;
- Zero in on your target market;
- Learn more about your target market’s needs and wants;
- identify the price points the market will bear;
- discover industry challenges; and
- shed light on other critical success factors.
Market Research Basics
There are two types of market research:
Primary Market Research
This involves getting information straight from your potential customers. Focus groups, online surveys, personal interviews, telephone interviews, and direct mail questionnaires are all examples of primary research methods. If you have an existing business, you can also use information about your current customers. Online reviews, notes about customer feedback, and other data that you’ve collected might provide valuable insight.
By doing primary research, you can learn directly about your target audience’s need for your product or service, lifestyle, buying habits, perception of your brand’s marketing assets (e.g., business name, logo, taglines, etc.), sensitivity to price, and more.
Secondary Market Research
Secondary research involves pulling together information from external sources to learn about opportunities and challenges within your market and industry. Studies, statistics, surveys, and other data from organizations that have conducted research can help you assess how much competition you face in your market, the size of your market, average earnings, and profitability of businesses like yours, regulatory factors that may affect your company, and other information.
Market Research Resources
So, where and how do you begin? As for primary research, a tool such as Survey Monkey can help streamline the creation and analysis of online surveys. If you’re not sure what to ask in your surveys, you can find articles to guide you in the types of questions to ask. In using focus groups, you might consider contracting someone with expertise in planning and executing them effectively. If your business is up and running, leverage data within your customer relationship management (CRM) system (if you use one), your accounting software, point of sale records, website analytics, inventory management system, and other programs.
For secondary research data, consider tapping the following resources:
- Trade associations (state, national, international)
- Local and state chambers of commerce
- Public and university libraries–including the Portland Public Library and the Digital Maine Library. Some provide free access to business and industry databases that you would otherwise need to pay to use. Reference librarians can assist you in finding the type of information you need.
- United States Census Bureau
- United States Department of Labor
- Think With Google
These represent a small sampling of organizations and online resources that might help you in your efforts. For additional insight into where you might find the information that you’ll need to launch or grow your small business successfully, ask a SCORE mentor for guidance. With experience in providing direction and feedback to entrepreneurs in all industries, SCORE has the knowledge and connections to help you no matter where you are in your business journey.