Every startup has to struggle which usually continues for 5 years and maybe even more. 30% of the new businesses fail within less than 2 years. And these are not just any startups but those with great ideas. The reasons for failure are many but the most common one is a lack of extensive market research.
With so much competition out there, only startups with the razor-sharp focus can survive. But the question is, how to conduct great market research to save your startup from failing? These ideas might help:
Start with primary research. It’s a search you conduct yourself. A popular method using in this research is the SWOT analysis. Discover the strengths, weaknesses, opportunities, and threats in your field.
Let’s say you are planning to launch a sales recruiting agency. The primary research for this would include learning what other sales recruitment agencies are doing, finding your market size, interests of your audience, and more information on how to be better than the rest.
Use online tools for your research. Google, Reddit, Quora will be very useful. Don’t forget to check the US. Census Bureau.
Do Quantitative and Qualitative Research
Quantitative research is about conducting surveys to gather information about your customers. This could be a combination of live surveys and social surveys. Qualitative research, on the other hand, focuses on organizing focus groups and conducting one on one interviews.
Find Potential Customers and Interview Them
Let’s dig up interviewing potential customers a little. Reach out to them to ask about their needs. Ask what they are looking for in a product or service. Create a social media poll for this. Use Google to create an online link and send it to potential customers whenever you find them online.
Look for social media groups to find a potential audience. Ask the admin if posting an online survey is allowed. If they allow it, post your link and wait for customers to respond.
From the survey and interviews, you should be able to figure out whether products and services similar to yours already exist, how much customers want to pay for a product, and how can you make your product or service better.
Learn About Your Competitors
Create a list of companies that are your competitors. Compare the features of your product/service to theirs. Understand their business and figure out how they climbed the ladder of success. Competitors are competitors even if their company size is similar to what yours will be, smaller or bigger. Do talk to the potential customers if the current players in the market are meeting their needs.
Ask Good Questions
Ask worthy questions. The first questions should always be welcoming to make the interviewee feel comfortable. For instance, how do you feel about (your market)? Jump to complex ones later on.
Your questions must ease the potential interview and encourage them to reveal those valuable nuggets of information.
Organize and Analyze Your Findings
Once you have gathered all the data, it’s time to organize and analyze. The first step is to read everything to make sure it’s in order. Then determine if the data collected has proven the hypothesis you started with. Use spreadsheets, PDFs, PowerPoint, and other tools to organize your findings for final analysis.
Create an Action Plan
The results of your research might reveal that you need to gather more information about a specific area. Chances are the interviews that bring forward a completely new market. That means you will have to repeat the abovementioned research steps to dig information on this new market.
Nevertheless, from all the information found, you should be able to work towards an action plan to create a great product/service.
Avoid These Mistakes
Often, while conducting research, many budding entrepreneurs end up making some common mistakes. Let’s highlight them so that you may avoid them:
- Market research is of two types: primary and secondary. Don’t just rely on secondary research (qualitative and quantitative research). One must conduct primary research to learn more about the market one is planning to enter.
- For interview purposes, don’t limit yourself to people you know. Reach out to as many people are you can (but they must be potential customers). Your friends and family can be great sources but their feedback isn’t always honest.
Conducting market research isn’t easy especially if you don’t have a business background. A firm has to rely on its HR department to come up with new talent acquisition strategies to attract and retain new employees, right? You might also have to rely on a professional for conducting research. Hence, don’t hesitate in seeking professional help.