How to carry out Market Research for Small Business?
By admin in How To Start on November 4th, 2009
It may sound surprising but many entrepreneurs today start a home business without ever really understanding the market they plan on serving. Well, a manager cannot run a small business efficiently without understanding the needs and requirements of the market and consumers. In fact, it becomes kind of critical to know the potential size of your market and, in turn, what sort of response your service or product will attract.
The best of efforts trying to sell something without knowing if a buyer has any money in his pocket are sure to lead to failure. A good understanding of these numbers regarding your business gives you a clear advantage.
These numbers could provide you details about demographic distribution of a region, different age group of a locality or region, income levels of an area to be considered and other such aspects. Based on the number derived from such parameters, you can decide how to position your position in different segments.
There are primarily two ways to conduct a research, qualitative and quantitative. Both of these can be incorporated in any tools, a few of which have been mentioned below.
There exist numerous tools in the market which carry out market research. Based on your requirement you could choose the optimum method that caters to your requirement. Some of the tools of market research are:
- Feedback forms – This is the more conventional method and applies well for a small scale radius. You can compile a set of questions and circulate it in to prospective costumers in your locality or neighborhood. Based on the response proceed with setting up your business.
- Online Surveys – With the power of internet growing by the hour, online surveys have emerged as the most feasible and popular methods to get a feel of public opinion. The other advantage of this method apart from its cost effective nature is the speed with which data collected can be collected and collated o provide the necessary results. It has been concluded that online surveys are 10 % less expensive than surveys conducted through phones, according to Lee Smith of Insight Express.
- Focus group discussions – You could conduct focus group discussions if you know the base your business would look to target. The responses generated from the questions would provide you a clear idea of the do’s and don’t before setting up your business.
- E-Mails – Based on the operating radius of your business, you could also reach out to a group or a set of people using e-mails. This approach would ensure a speedy response and would be cost effective but collating the data might take some time.