With the continually changing dynamics of today’s business world, preliminary research is vital for any startup business. There are many considerations to make before starting a business to determine the overall practicality and feasibility of the new venture. A critical step when doing this is to study the target market and their potential interest in the product or service you are offering. Different methods are used to acquire this information, with market research being the most common approach.
Conducting market research before launching any product or service is important, as failing to properly plan could result in an undesirable outcome. Make sure you allocate adequate time and resources to achieve optimal results.
Unfortunately, many new business owners end up making avoidable mistakes in the process of performing preliminary market research. Here are some common mistakes to avoid.
The rapidly changing digital age means that more and more customers are becoming increasingly tech-savvy. Despite this, many market researchers doing fieldwork tend to lag behind when it comes to incorporating technology into performing their duties. If the target audience spends more time online, then researchers need to be utilizing technologies in that space. Technology also improves market research fieldwork efficiency, with pen and paper surveys being widely replaced by Tablet Surveys, for example, which are more dependable, portable, and efficient.
Market research isn’t a one-time occurence. As a business owner, you need to continually keep track of any changes regarding your product or service. Aspects such as influencer trends, branding, and market innovations are all subject to change. These factors may influence how people interact with your product or service and serve to inform you of any necessary adjustments you need to make to keep your product or service relevant. Ideally, data tracking should be done annually or quarterly depending on the business, but it should never be just a one-time task.
Many researchers are comfortable with just identifying their competitors in market research, which is a huge mistake. Analyzing your competition gives you the upper hand. During this analysis, you acquire information regarding their marketing strategies, their strengths and their weaknesses. By studying this information relative to your brand, products, or services, your business will always be a step ahead of the rest. Knowing what makes your business competitors successful is priceless.
Market research relies heavily on quality quantitative analysis. For maximum effectiveness, the researcher should receive feedback from a substantial number of people, with a minimum recommended number of 500 people. The people included in your market research sample size should adequately represent the region’s different genders and age groups. Aside from the sample size, the contact people should be extensively addressed to acquire informative responses and opinions, giving you the necessary information to proceed to the next step.
Before beginning the fieldwork associated with market research, you need to come up with the right questions to get you the responses that will help you inform your decision. Using ambiguous questions leads to inaccurate data acquisition, resulting in a waste of time and resources. Many researchers come up with questions solely based on the product or service to be offered. When choosing the questions to use, keep the consumers in mind, what they care about, and why they do. That will give you critical information regarding how the product or service will fit into their lives.
A common mistake made by market researchers when conducting interviews is ignoring question moderation. A good question should be open-ended and should not invade the consumer’s privacy. Invasive questions tend to adversely affect the customer’s response, leading to a shallow response with inadequate information. Moderating the discussion when such an incident occurs is essential in acquiring the necessary information. Also try to avoid any awkward situations, and be sure to come back to the topic if the discussion strays from it.
A survey is only as good as the data analysis on the report. Vaguely reporting the data and information acquired from the field without a proper format makes the entire research study a waste of resources. In the report, ensure all the data is backed up with adequate evidence acquired from the field and proper conclusions drawn from the same. Specificity is key in writing reports. Any generalized information not deeply analyzed within the report may lead to inconclusive information and paint an inaccurate picture.
Asking the wrong people all the right questions will still give you inaccurate information. It is crucial to accurately write down who exactly you want to talk to and why. Poor sampling does not easily stand out compared to incorrect questions, but you may realize this a little too late. Good sample selection requires stating the rules that define who will be included in the sample selection and carrying out a proper cross-comparison depending on the various subgroups involved in the study.
Giving incentives is a huge part of conducting any research, as it is seen as a way of compensating someone in exchange for their time. However, giving meager compensation undervalues the participant’s time and effort in assisting your business. Cost-effectiveness is important in the business world, but low incentives may do more harm than good. Many consumers rarely participate in market research studies if their time seems undervalued. A fair compensation amount will result in higher participation and better results.
Knowing the target market, your competitors, and estimating how your product will fare in the market is essential for starting a new business. Conducting proper market research is a sure way of getting all the necessary information to succeed. Market research is not just crucial before starting a business, doing regular follow-up is essential in growing your business and ensuring it thrives. By avoiding unnecessary mistakes, the information gathered will be unbiased, well rounded, and pave the way for product development and distribution in the future.