The Importance of Market Research to Small Businesses
Market research, both primary and secondary is key to helping small business owners understand who will likely be interested in their products/services, what motivates consumers to choose where they spend their money, and what kinds of successes and setbacks their competitors in the same industry are currently experiencing.
By identifying the most beneficial and practical sources of market research and by learning to interpret and use the resulting data wisely, small businesses can gain a big competitive advantage.
Below, we’ll look briefly at 5 of the most effective ways for entrepreneurs to conduct market research that gets truly valuable results:
1. Community / Customer Surveys
When setting up a new business, one of the first things you should do is start collecting information on what locals, likely to become customers, are looking for in your business-type. And you should also conduct customer feedback surveys using the best available data collection software.
With modern software programs, surveys can be customized to get only and all the information you want and need. You can also track survey workers with GPS, work offline when necessary without losing data, and convert data into charts and graphs that helpfully visualize the results.
2. Social Media Surveys
Another way you can survey customers and prospects, aside from door to door or in-store, is via the Internet. And there’s no better place to conduct online surveys than on popular social media sites.
You could, for example, advertise a new product or service on Facebook and then ask people to fill out a short survey in exchange for a printable coupon. You can also use social media ads to funnel prospects to your website and ask them to fill out a feedback survey there, collecting valuable email addresses along the way to use in future email marketing campaigns.
3. Telephone Interviews
There are two ways you can effectively use telemarketing campaigns to gather useful data for you small business.
First, you can hire a telemarketing firm to do short interview calls to everyone in your local area during a special campaign. This will get you general information on consumers in the area that you can then analyze demographically.
Second, you can conduct longer phone interviews of your actual current customers whose phone numbers you’ve already collected. This will prove to be a valuable peek at what your customers are saying (or thinking) about you.
4. Focus Groups
Gathering together all of your primary research data, along with your sales records, it’s time to crunch numbers, analyze data in depth, and draw some conclusions.
It’s often best to arrange a focus group for this purpose, led by a few of your employees but consisting of loyal customers who are willing to give you some time and feedback in exchange for a free product or other reward.
5. Secondary Market Research
Secondary research really should be kept secondary. Start with your own surveys, research, and analysis and go from there.
First of all, utilize public records and free content available online that focuses on your market niche. Read reports, statistics, and expert opinion pieces written for your industry. For example, you can get a lot of good data free from the Office for National Statistics, from the US Census Bureau, and from the Federation of Small Businesses.
As a final touch, pay for a third party to collect and analyze market research for you. In fact, hire two or more firms and compare their results with each others and with your own.
Follow these five market research tips, and your small business will gain access to important data points that will translate into real knowledge of customer motivation and buying patterns. It’s the kind of data that can help you adjust and position yourself for future growth.