Easy and effective market research

Good market research will help you better understand what customers want to buy, and what they’re willing to pay.

Knowing your market and understanding your customers should be top of your Must Do list. Good market research will help you better understand what customers want to buy, and what they’re willing to pay. This will mean you’re in a better position to be their preferred choice.

Market research is commonplace

Market research need not necessarily be complex or time consuming. In fact, it’s something that every business in Canada does – often without even referring to it as market research.

You’ve probably already gathered information about the feasibility of your idea, including:

  • Customer preferences.
  • Demand for your product or service.
  • The best location for your enterprise.
  • If you’re developing a formal business plan, it’ll most likely include information about the marketplace, your competition, and your target customers.

Primary information

The most useful information is often what you collect first-hand, within your own market (or prospective market) and through your own operations and customers. With this ‘primary source’ market research you can find out:

  • Why customers will choose your business.
  • How you can retain them.
  • How you can gain your customer base.

Depending on the size of your initial customer base, you’re likely able to gain primary information through person-to-person conversations with your customers (for example, face-to-face, online or by phone).

However, as you continue to add customers you’ll find it more challenging to respond to them individually. So, you may want to consider other ways of gaining customer insights.

Secondary sources

Market research can also be gathered through secondary sources, such as:

  • Online.
  • In a library.
  • Through a trade publication.

Using surveys to gather more detailed information

Customer surveys can be administered directly (by a sales person) or distributed in a non-invasive way. This can include simple measures such as the visible placement of customer feedback forms or questionnaires at your place of business, or within mailed invoices.

If you maintain a website, you can also include multi-level surveys for customers at little or no cost. There are numerous on-line options available for DIY surveys, and many of them are free. Links to the survey should feature prominently on your homepage and in e-mail and other correspondence with your customers.

Researching prospective customers

This can be a little more difficult. People don’t often respond well to unsolicited email and telemarketing.. The direct mail approach is less restricted, but has a relatively low response rate.

Face-to-face approaches such as at a consumer or trade fair where target customers will be present are likely to be more successful. Providing incentives can increase the response rate (for instance, offer a coupon, discount or sample for completed surveys).

Employing focus groups

Other methods of gaining primary research include focus groups (a gathering of consumers who’re brought together to discuss a product) and personal interviews (one-on-one sessions with consumers).

Offering product samples and comparison products at these events is a good way to generate discussion.

The range of questions you may raise during a market research exercise will vary from product to product, or service to service. It should include questions to determine:

  • Preference – flavours or features.
  • Consumer behaviour – “How often would you use this product?”.
  • Pricing – finding out how much people are prepared to pay.

Compare feedback

A first and easy step you can do to improve your market research is to turn your initial customers’ feedback into data. Keep a record of the feedback you receive from new customers and compare customers’ preferences and complaints. This will give you a data set from which you can start drawing conclusions and shaping strategy.

Next steps