Starting your own small business is always risky, so it’s of the utmost importance that you’re confident about your business model before you start pouring time, money and effort into it. Market research is the surefire way to check that your moment of epiphany about the service or product you’re offering is actually sound.
To that end we’ve put together a list of five tools that could help you test the water in your relevant market. But first, a few things to consider before you even get going…
Who is your market?
Any market research will be fruitless if you don’t know the market you need to target. If your product is for children for example, you’ll need to think about how children – or perhaps their parents – will perceive it. Alternatively, you may be offering a service to business people and so you’ll need to target people in a certain demographic to get relevant feedback.
Have you covered the market research basics?
There are many simple market research exercises you can carry out for little or no money, without the need for online tools. If you were wanting to start a website selling products to new mums for example, you may choose to go to a coffee-shop or play centre and chat to them about what they might be looking for. Or better yet, host a coffee morning where you give out tea and biscuits in return for guidance on your business.
The other basic starting point is checking out your competition. Whether they’re based online or offline, take on the role of a customer and observe everything from prices to product listings and customer service to branding.
Are you ready to hear negative feedback?
There’s no point in conducting market research if you’re only going to dismiss it in favour of your own opinions. Prepare yourself for the possibility that people won’t like what you’re planning on doing and be flexible enough to use that to alter your plans. When you’re just starting out, negative feedback – whether obtained through conversation or any of the tools listed below – can often be much more valuable than positive feedback.
Market research tool #1 – AYTM
Also known as Ask Your Target Market, this is a tool that enables you to put together tailor-made surveys. These can then either be sent to your own list of contacts or to the AYTM panel, which is made up of 4.5 million people. Clearly you wouldn’t want to ask all 4.5 million of them about your fledgling idea, so what you can do is hone the list down by different criteria, such as gender and geographic location. The company is based in the US, but their survey takers are spread across the globe. This service isn’t free to use, you pay a minimum of 95 cents for one response, but most surveys are completed within 24 hours, so it’s handy if you’ve got time constraints.
Market research tool #2 – BizStats
This powerful tool is entirely free, and can provide serious insights into the revenue potential for your small business. We’re talking free business statistics and financial data, which covers various industries and enables you to see what companies in your field and of a similar size are turning over. And should you need a hand wading through all that data, BizStats also provides calculators and other tools, which can help in getting to grips with profit-risk ratios, cost of goods sold and valuation factors.
Market research tool #3 – Wordtracker
Searching for products and services via search engines like Google is second nature to most of us. So why not use those searches to discover what people are looking for in your field? Identifying the ‘keywords’ that people use to find your type of product or service online will offer invaluable insights into how you should position your business and maximise on any niches you may not have considered. You can also use a site like Wordtracker to find out how much interest there is in those keywords and how much competition there is in that market.
Market research tool #4 – Survey Monkey Basic
If you’re keen to conduct a survey to find out what people make of the products or service your small business offers, but money is tight, then this is a great option. Survey Monkey Basic walks you through creating online surveys and opinion polls free of charge, which can then be sent out among your own contacts. And it isn’t just flat, multiple-choice surveys on offer, this tool also allows respondents to provide additional insights through open ended question formats.
Market research tool #5 – Clipular
The internet itself is a great way to conduct research into your target market, through both competitors sites and those that your target market tend to frequent. Learning from what’s already out there on the internet is really important, but it can be easy to get lost among all the different sites, blogs and ecommerce platforms you look into. A good solution is Clipular, which lets you capture everything from a dynamic application to a Facebook comment, a snippet from a news feed to a still from a video. These can then be compiled into a neat presentation, which you can keep referring back to when you need your target market to be front of mind.