Market Research for Small Businesses
There are lots of ways that success in business can be defined. However, what every definition essentially comes down to is catering to demand and doing so in a way that is better than your competitors.
However, understanding what decisions are going to lead you on the right path doesn’t happen by chance. Instead, market research is one of the best tools any business can use to supercharge its efforts.
The following guide on market research for small businesses has been created by NimbleFins, which provides competitive insurance quotes to business owners in the UK.
Do Small Businesses Need Market Research?
You’re probably familiar with the statistic that 60% of small businesses fail within the first 3 years. But did you know that one of the main reasons for this shocking fact is a lack of market research?
After all, whether your business employs 5 or 500 people, you still need to be sure that your product offering is aligning with both your customers and the overall market demand.
Whatsmore, a small business doesn’t have multiple branches or a global headquarters to keep the business afloat in turbulent times; hence it couldn’t be more important to understand your market as a small business. Otherwise, you could make costly mistakes either through poor investments or by missing golden opportunities to expand your business offering.
So, the answer to the question is yes, and small businesses definitely need to do their market research! But, ideally, before the business is formed and throughout the course of its life.
How To Conduct Market Research For Small Business
The process of market research involves collecting data, organising it in a way that will be most beneficial, and then implementing any changes based on your findings.
Depending on your budget, you may choose to conduct your own market research or have a professional company take care of it for you. However, consider that in order to gain the most honest responses, you may want to use a neutral party that is not directly associated with your company to engage with your market research participants.
Market research methods include:
- Analyse sales data
- Competitive analysis
- Field trials
- Focus groups
- Paid research
- Public domain data
- Social media analytics
- Telephone interviews
You’ll notice that some tactics, such as interpreting your sales data or social media analytics, can be done for free without engaging with any external parties. Again, though, to build a wider picture of where your business is at, and most crucially where it’s falling short, you’ll need to collect broad types of data.
All of which is going to help you understand who is accessing your business, along with who isn’t and why. Market research can help you to spot trends about the industry you operate in within a whole, so that your offering remains current, promoting the longevity and stability of your business in the process.
How To Make Best Use Of Market Research Data
The reason for undertaking market research is so that your business can reach its potential. A great place to start is by looking at your customer demographics to ensure your product offering and your marketing techniques align with the information that has been uncovered.
For example, if your small business creates products for senior citizens, then marketing on social media platforms that typically have a low percentage of users above the age of 65 wouldn’t be effective. However, TV, radio or newspapers would get your brand in front of the right people.
You may also discover unexpected trends relating to your demographic or industry as a whole. It’s important to be aware of even the slightest changes, as it may mean you need to adjust your products, services, or marketing. This is why market research needs to be conducted often, especially as the world is ever-evolving. By staying on top of trends, you can avoid getting left behind.
Also, market research can help bring investors on board to your business, as any bank or investor will want data to back up any claims you make about your company. Such data can make all the difference when it comes to growing your business.
To Sum Up
With trial and error, there’s always a huge risk of making costly business decisions. Instead, you need a more reliable way of knowing what your customers want from you. Market research is incredibly insightful, especially for small businesses that may have limited resources while being up against a lot of competition.
From surveys to focus groups, field trials to interviews – it’s time to get talking to your customers as well as the general public. Find out if what you are offering is truly catering to demand or if there’s room for improvement. If you take your time to conduct thorough research and adapt your business to your findings if necessary, you’ll be far better equipped to navigate the various challenges that running a small business can bring.