Most people consider they have done enough primary market research by talking to family and friends. While their feedback is important, it’s hardly unbiased and could well be misinformed. You owe it to yourself to take an objective look at your business proposal before you fully commit to it.
Another aspect to the whole business proposition is your own emotional attachment to your business idea. Whilst this is strength in terms of determination to make your venture succeed when you get going, it may be a weakness in evaluating research results. This attachment may cloud your judgment if your research indicates that your business may not have a market or serve a market need. Before investing money, you need hard facts and evidence to prove the need and demand for what you want to do.
Small business can rarely afford detailed research to produce a large amount of data to predict various outcomes and scenarios. You can, however, get valuable and accurate market information by:
Market Research questionnaires: Based on the outcomes of your secondary research, list the ten most important questions you want answers from your customers on. Questions should cover, as a minimum, details on prospective customers, the market/industry, the competition, pricing, size, frequency of purchasing etc.
Focus groups: A valuable way of collecting market and customer data, a focus group can provide you with feedback on your idea. Formal focus groups typically involve up to ten people and will be facilitated by an outside expert and provide valuable information. Focus groups can prove expensive, however, and may not be an option for small start-ups. In this event, some industry sectors such as food and tourism provide information from these focus groups on line. You can also conduct an informal focus group activity by attending networking and business events and targeting key people to ask specific questions of.
Indirect research: Sometimes you might not be able to obtain the information you need first hand. Use your ingenuity to indirectly tap the information you require, such as:
– Count cars in competitors’ car parks;
– Count people in competitors’ premises;
– Count the footfall in specific areas. Some cities have this information available!;
– Count the number of trucks delivering to competitors;
– Visit competitors as a customer and experience their service and products.
You might need to carry out these activities at different times and on different days to build an accurate picture of your market activity.