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Saturday, February 8, 2014

Market research for small businesses

Market research helps businesses compete
Researching unhelpful information wastes business resources

By Sam Wright

The thought of conducting market research can be daunting, especially if you’re trying to run a small business as well. Knowing where to start is half the battle, though. Here’s how to take control of the situation and get your business back on the right track:

Decide what you need to know

Who are your competitors? What are the main issues in your sector right now? How much are people willing to pay for your services? What do they think of your product? Whatever you need to know, start by defining it. The more clear you are on the questions you’re asking, the more accurate your results will be. 

Many small businesses make the mistake of focusing solely on their company, and when it comes to conducting market research, neglect the bigger picture. It’s important to know whether the industry is shrinking, growing, or stagnating — as well as what technological, cultural, and economical developments are affecting it. 

Work out what type of information you need

You need to know exactly what sort of data you’re looking for here. Deciding whether you need qualitative data, quantitative data or a combination of the two is a good place to start, but you need to go further than that: do you need to hear from customers? Potential customers? Industry specialists? 

Decide how to acquire that information

If you’re new to market research, you’re best off using the internet to gather your data — there are plenty of free tools around that are simple to use and don’t cost anything. If you need to hear from customers, try online surveys. If you need to find out what businesses you’re up against, there are online databases that can help with that. Until you’re confident in what you’re doing, the internet’s probably your best bet. You can find out so much information for free, and it’s quickly eclipsing more traditional forms of market research.

Analyse the data

If you’re dealing with relatively small amounts of data, Excel or Google Docs will work perfectly. For big data, Google BigQuery is an option, but chances are, by the time you have that much data to deal with, you’ll be able to afford a professional. 

You don’t need any fancy tools if you’re dealing with a small sample. Keep track of what you’ve discovered, and make sure this information’s safe and well-organised — next time you conduct market research, you’ll need to compare your results to see if anything’s changed. 

…And repeat

Market research is an ongoing thing. Of course, it’s best to do as much as you can before you start your business, but you have to make an effort to stay on top of it as your company grows. Some things, like customer satisfaction, can be tracked using social media. 

Surveys and online polls are useful for more specific feedback (what feature consumers would most like to see in a new product, for example) but heavy research is also unavoidable. You’ll have to spend time reading relevant news articles — Google Alerts can help you keep on top of this — and investigating your competitors, both locally and globally. 

About the author: Sam Wright is a freelance writer specialising in small business. He is currently working for Brand Republic.

Image license: Adam Sandberg, CC BY 2.0