Hitting on a brilliant business idea might seem like the tough part but that is just the beginning of your journey to start your own business. Finding what you want to do and taking the plunge to turn the idea into a real business is step one. How do you know that your business idea is something that can be built into a profitable scalable business? How do you know there is a market out there for what you’re selling? Who would your customers be? And are you sure there’s not a million other firms out there offering the exact same thing? What you need to do is market research.
The basics of market research are finding out about the world in which your business will live. It’s all about identifying your potential customers, understanding the market your product will exist in, and informing yourself about everything that may impact how you do business. It might seem like an overwhelming amount of information to gather but if you work through some basic market research steps, you’ll find you’re in a much better position to make informed decisions about your new business.
Who are your customers?
When working towards a business launch, it’s easy to assume that everyone you’re selling your product or service to will understand it like you do, need it like you do, buy it like you would. That’s not always the case, for better and for worse. It’s time well spent to think critically about all of the different potential customers you might have. Mapping out a profile for each is a smart way to do this and building in as much detail as possible will be invaluable. Start with details like, age, male / female, geographic location, education, job, earnings, family situation, hobbies and activities, where they might shop, what social platforms they engage in etc. Government Census information can be very useful here, and make sure you tap into other surveys and data that might help you.
As you fill in as much as you can about your prospective customers you might find that your target audience is broader than you expected, or narrower. Neither is a bad thing, both will help you to better contact and engage with your customer since you know more about them. This is particularly helpful in the digital world when engagement and customer communications happen remotely. Understanding the influences of your target audience, where they live online, when they engage with content, and what content they are looking for, can be incredibly helpful in crafting your marketing strategy and honing your offering directly to those individuals.
Once you’ve identified your customer groups, see if you can find a way to reach out to them. Maybe start with friends of friends and set up small in-person or virtual market research groups where you can ask about your product, gauge feedback, listen to comments and critiques, and hear what individuals would love to see from brands. There are also services like Survey Monkey, Facebook Groups and other market research avenues that you could explore where you can test out questions and gather feedback to inform your business development.
Who are your competitors?
It’s hard to find a market that is not saturated these days. No matter how innovative your product offering is, it’s often the case that there is something similar, or at least overlapping that is relevant to how and where you market your product.
Consider two groups of competitors and research into those. Firstly, you have your ‘direct’ competitors – those who offer very similar if not the same products or services in and around the same region. For example, a dog grooming service in Larne would have direct competition from other pet grooming providers in Larne. The second group are the ‘indirect’ competitors and these are businesses that offer a product or service in the same market that could potentially be an alternative for your customers to engage with. For example, a hair salon setting up in Bangor, may have indirect competition from a beauty salon in Holywood. Once you have your list of direct and indirect competitors, find out as much as you can about them. What is their market share, or turnover? How do they communicate with their customers? What online platforms do they use? What reviews do they have? Can you identify strengths and weaknesses of their service that you can use to improve on?
Understanding as much about your competitors as possible will arm you well in predicting and preventing problems they’ve experienced, and positioning yourself differently enough to capture your own market.
What is happening in your market?
Do some homework into the market you’ll be entering. Data and surveys are often available online via government sites, management companies and other data gathering services, so see what you can find that’s relevant to your product or service. The size of the market, who has what market share, whether the market has been growing or shrinking, what’s happening in response to global and political events. All and any information you can collect here will be useful in painting a picture of your market and informing you about how well your product or service will do in it.
What does all this mean?
Once you’ve compiled as much information as you can about the people, the businesses and the market you’ll be entering, you will start to see a broader picture about your planned business. Perhaps you’ll notice that actually your product has too niche a market to grow or scale a business? Or perhaps you’ll have discovered through your research that while your original business idea is good, you’ve noticed a gap in the market that you could enter and tap into in a far more lucrative and future-proofed way.
It can be a challenge if you discover information that shines a negative light on your plans. That is tough for any entrepreneur but it’s important to find that out early before you’ve invested more time and money into something that did not have the potential you’d originally hoped for. Look at market research as your probation period- you’re feeling out the world for your business, seeing what’s likely to work and what might not work. Whatever you find and whatever you can’t find is useful.
It’s far better to understand more fully the business world you’re entering, in order to give your business the best chance of success.
Whatever your business idea, whether it’s just something you’ve been mulling over or whether you’ve taken some steps on the entrepreneurial path already, we’d love to help. Read some of our Go For It Success Stories [https://www.goforitni.com/success-stories/] and get in touch [link https://www.goforitni.com/get-in-touch/}. Our business experts will be delighted to hear from you and to talk you through everything you might need to know to move forward with your business concept.