You’ve got the big idea. You have the means to make it work (or you know where to get them). You’re 100% certain, without a doubt, that your startup is set to be a splash hit.
Your confidence is commendable - but before your early stage company gets off the ground, you have to validate a few key points. If there’s one piece of startup advice you can use to ensure a product-market fit, it’s this: conduct market research.
Starting a business is one of the most rewarding things in life, but it’s not without its difficulties. Finding funding, marketing, product development and the day-to-day running are just a few of the things you’ll need to be on top of, curating all the advice for startups as you can along the way; and those hurdles are just the tip of the iceberg. First and foremost, you need to be sure there’s a market for your idea, and that’s where market research comes in.
How do I do market research?
There are lots of different kinds of market research, and using more than one kind gives you a well-rounded view of how your product is received and the best way to get your business off the ground. Conducting thorough, fair testing on your target audience is essential if you hope to keep your business afloat - and with just 50% of businesses making it past the five-year mark, skimping on your market research is not an option.
What are the main types of market research?
Depending on your startup’s budget and focus, you should consider a variety of market research methods. Whether you’re launching a business from scratch, building your brand DNA or testing out a new product, you need to find the method that gets you the most useful and actionable information.
Luckily for you, countless market research projects have already been conducted, so you can gather quite a lot of intel through what’s called secondary data - that is, data collected by someone else. Think of it as a head-start on your market research project. If you have the funding and resources to conduct your research in-house, you’re collecting what’s called primary data, which is even more valuable because it’s going to be tailored data that’s relevant and helpful to your specific brand or business.
Here’s the low-down on the types of market research methods you should consider for your startup:
1. Secondary research
Don’t make things harder for yourself than they need to be. Start off by looking at the resources available to you from market research studies that other companies have done. Secondary research gives you an insight into overall market trends and lets you see how your competitors are doing - there’s plenty of available data out there on the Internet for you to get a solid understanding of the market you’re diving into. Secondary data is usually free and easy to source, so it’s perfect starting point and will serve as great startup advice for any early or mid-stage company.
2. Product testing
Getting your product in front of your target audience is the best way to gather data on how they receive it. Doing this on your terms in a controlled environment means you can catch every reaction to the way it looks, feels and works. Product testing is so, so, so valuable to your startup; you can work out how your product will be received in different areas of the market and by a range of people from all walks of life at the same time you make decisions on where your product fits.
3. Focus groups
You can’t beat first-hand feedback when you’re getting started up. Focus groups allow you to bring together a group of people from your selected market - or even a couple of groups from separate markets - to discuss anything and everything you could want to find out about your startup and your market. Your sessions are guided by a moderator, which means focus groups will provide useful qualitative data. You can even host online focus groups, although you should consider a few additional things when organizing them.
Advertising can be costly, so you need to be sure you get it right - or as right as possible. There’s huge pressure on businesses to prove ROI on their marketing investments and your advertising streams will be a central part of this. When you’re launching your startup you’ll need advertising testing to decide on the concepts, artwork and copy. You can test this on your colleagues, friends, family, anyone and everyone available to you. Once you’ve launched and tested the very first ads, use A/B testing to make sure you’re always evolving and creating better ads.
5. Customer surveys
Market research surveys can be done online, over the phone, on paper or face-to-face. In today’s digital age, it’s cost-effective to send out customer surveys via email - just be sure to get permission before you do so, or risk falling down a GDPR rabbit hole. In your survey you can ask new, existing and potential customers their opinion on your startup business, your products, your marketing plans and any other valuable info you think will help you succeed. Surveys help you get a big sample of data for little effort, so they’re well worth the time.
Want to know more ways you can make your market research interviews work for your company? Find out here