Before you open the doors on your new business, it is essential that you take a step back and define exactly what you want to do and how you’ll be successful. One of the most common mistakes when opening small businesses is the desire to be ‘all things to all people’ – essentially targeting your products and services far too widely and not being able to focus on the segments, products and messages that will drive your young business.
It takes money and time to start a small business, and even more of both to maintain it. Money and time are surprisingly finite when it comes to getting a company off the ground. Making decisions based solely on instinct during that quick start-up period can be potentially catastrophic, and can be tied to the eventual sinking of many failed small businesses.
Market research is the essential process of analyzing past and current market trends to inform the key decisions you will make before you decide to launch your small business. Before every big business decision you should conduct market research. Good market research knows all the answers – like a mentor who has the wisdom of having done it before. But it also acts like a clairvoyant that can see into the future when done correctly. But how?
- Study the Economy: You’re not an economist, but that’s OK! With a little research, you can better understand reports about some of the most important big factors affecting the industry you’re in and the customers you hope will spend their money on your products or services. When the economy is weak, demand may fall. Income statistics can give you insight into whether your clientele will place a higher value on price over quality.
- Industry Publications: Whatever your industry, there’s likely a trade group or research firm out there compiling industry statistics and trends that are all insights into your business. Join your industry trade group or follow key industry thought leaders on Twitter today – not only will they advocate on your behalf, they will often share detailed industry statistics or even trending tidbits that can help you better understand the past, present and future of companies like yours.
- Look Elsewhere: For the average local business, you don’t think much about what is happening outside the borders of where your customers live. But you still have a use for market research outside your local borders. There are success stories (and cautionary tales) in many other regions of the world that you can learn from. A similar business on the opposite end of the country may give you some great promotional ideas, or an international market could start complaining about rising commodity prices before they affect you directly. Keep your ear to the ground – the marketplace is shrinking and in this day and age, it’s easy to listen to the rest of the world.
- Pound the Pavement: The answers may not be out there…yet! So don’t be afraid to ask the public what they think of an idea before you launch it as a product or service to those very same people. Conduct an online survey and ask your customers for their opinion, call past customers, or hire a firm to conduct your most important research for you. You’re looking for direct feedback on products and services, so who better to ask than the very people who may soon be buying them? It can be tough to get started (we can help!), but it will yield results and could lead to insights that literally change the future.
Your gut instinct has gotten you far in the world, but don’t rely on it for the crucial decisions. Companies that conduct complete market research quickly learn whether an idea is worth the investment of time and capital. Contact us for a quote today on how you can get started.