As a small business owner, you sometimes need to take on responsibilities outside your comfort zone, including marketing. Effective marketing relies on knowing both your competition and your market. Market research can help hit both of these targets.
A recent study from research firm Hinge showed that a key difference between companies with high growth and those with no growth was that the high-growth firms were more than twice as likely to have used research. What’s the benefit? The more you find out about what your customers want, the easier it will be to become profitable.
Some business owners shy away from research because they either think they know their market already or worry that research will be too expensive. However, market research can help take the guesswork out of what your customers need and want, and it may help you understand your own biases toward your products or services. In some cases, you can do a fair amount of the legwork yourself to reduce the cost of research.
Here are a few tips to consider in conducting market research:
Find new growth areas. Research can give you a clearer sense of your position within the industry, which can help you reduce business risk and spot problem areas — and highlight key growth opportunities.
Take advantage of government data. The U.S. government, for example, has a wealth of information available to you at little or no cost, including demographics, economic indicators, employment statistics, and income and earnings data.
Use available academic research. Getting information from already available sources, such as business magazines and academic institutions that perform their own research on business trends, is a smart tactic. Use it to learn more about your customers and competitors.
Join a trade group or an industry association. While trade associations will be made up of your competitors, getting to know them will give you deeper insights into your competition and your industry or sector. Joining an industry group will also widen your network and help expose your services to the market.
Evaluate professional market research firms. While their services can be costlier than you might be accustomed to paying, market research firms could increase your advantage and help hone your message to reach potential clients more effectively.
Commit to an ongoing market research strategy. Markets change, and you can adapt more nimbly if you’re closely attuned to what’s happening. As a small business, you have less margin for error, so you need to focus on your core business strengths.
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