Why Ongoing Market Research Is Essential For Every Small Business
Small business owners can sometimes be guilty of neglecting their market research. This is a great shame, because it's an essential component of any viable business plan at every step.
While you're in the planning stages, you'll need to know what's already out there to help you stand out from your competitors. Once you're up and running, you'll need to cultivate a target audience to maximise your profit potential. As your business grows, you'll need to learn more and more about what that audience responds to and what they want you to do for them. Undertaking an ongoing program of market research is the only way to do this, and it's vital no matter the size or focus of your business.
What Market Research Really Is
There are two types of market research: primary and secondary. You'll need to make use of both if you hope to reap the full benefits market research has to offer.
Primary research is when you find out something new for yourself by talking to your customers, by sending out questionnaires and collating the responses, by putting together focus groups, or by gathering data in other ways.
Secondary research is when you collect and make use of market research data already gathered by other sources. Good examples of these sources include the Australian Bureau of Statistics.
How To Develop A Market Research Strategy
There are three basic steps to putting together a strategy for effective market research for your small business.
Come up with a question you're trying to answer. For example, this could be "should I aim my product at 20-somethings or 30-somethings?" or "is this new recipe going to help me branch out into the clean eating crowd?"
Figure out who you need to ask. In the first example, you want to target those two demographics. In the second, you might want to look at gym-goers or people who frequent clean eating blogs.
Decide what the best research method is. If you're dealing with a large group (such as "20-somethings"), a survey is a good idea; for a more specific audience ("clean eaters"), a focus group is a great choice.
Once you've done all that, you're ready to get going!
This can be a lot to take on, and it's not always effective if done poorly. Why not consider hiring a market research agency to do the hard work for you and report back their findings? It might cost a little money, but you'll make it back in the long term.