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The goal of doing market research is to equip yourself with the information you need to make informed business decisions about start-up, innovation, growth and the 4 P’s:

 

  • Product — Improve your product or service based on findings about what your customers really want and need. Focus on things like function, appearance and customer service or warranties.
  • Price — Set a price based on popular profit margins, competitors’ prices, financing options or the price a customer is willing to pay.
  • Placement — Decide where to set up and how to distribute a product. Compare the characteristics of different locations and the value of points of sale (retail, wholesale, online).
  • Promotion — Figure out how to best reach particular market segments (teens, families, students, professionals, etc.) in areas of advertising and publicity, social media, and branding.

Market research can help you:

  • Understand your customers and their preferences (4 P’s)

    • Profile your customers (location, age, gender, income level, etc.)
    • Create more effective marketing campaigns
    • Find the best business location
  • Identify opportunities to grow and increase profits

    • Recognize changes in demand
    • Offer new products or services for the new demand
    • Find new markets within and outside of a country
  • Recognize and plan for industry and economic shifts

    • Shift inventory, price and staff levels as needed
  • Monitor the competition in your market

    • Identify competitors
    • Get information on how your competitors operate
    • Learn how customers compare you with your competitors
    • Mitigate risk in your business decisions
      • Use information, not just intuition, to drive your business decisions

When to conduct market research?

Market research is widely viewed as a component of the planning stage of a business. Indeed, market research is critical for new start-ups and should be a key element of any entrepreneur’s business plan. Market research data feeds into a number of areas of the business plan, contributing to sections on:

  • Determining the sales potential of your products and services

      • Identifying the demographic characteristics of your customers
      • Selecting the appropriate business location
      • Setting the price for your products and services
  • Attracting customers to your business

      • Establishing your company image
      • Setting prices for your products and services
      • Ensuring advertising is on target
      • Selling to customers and earning repeat business
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