Market research is vital for any start up as it helps you understand what your customers want.
Before you launch, you need to understand the market, your potential customers, and whether there’s a demand for your products or services.
If that demand isn’t there, your business is unlikely to be viable.
Market research also gives indicators on how much customers may be willing to pay, product features that will tempt them to buy, and how you can continuously improve your offering.
Learn more about market research with our guide.
Before you launch
Understand customers
Learn where they live, what they like, and how they shop or buy.
This will help you identify how your business can meet the needs and interests of your customers.
Test your business idea
Early feedback can help refine your business idea, price it competitively, and see if there’s demand for it.
When you are up and running
Improve your business
Ongoing feedback on everything from customer service to how customers use your product is invaluable for improving your business and planning for future product launches.
Analyse your band and competitors
Learn what customers think about your brand and how they view your competitors, which you can use to develop a marketing strategy.
Create press releases
Often overlooked, but a press release based on a customer survey or market research has a better chance of getting media coverage for your start up, particularly if you can tailor it to the media outlet you’re sending it to.
How does market research work?
There are different ways to carry out market research – some you can do yourself at little cost while others can require the services of a market research company.
There are two ways you can conduct market research: desk research and field research.
Desk research
This involves researching your market online, using industry papers and reports, online marketing tools, and even government services such as YouGov, all of which you can do from the comfort of your own desk.
Field research
Field research involves meeting customers and listening to their feedback.
This can be in focus groups or observing them as they browse a store.
Groups of customers can be invited to test a pre-production version of your product and give feedback, or you can conduct market research surveys by asking questions to people on the street.
Market research techniques
Institutional data
Public sector bodies are a great source of data for market research.
Through organisations like the Office for National Statistics, YouGov, and the British Library you can access lots of consumer information, including age, occupation, and location to kick-start your market research.
Industry data
Trade associations and organisations have lots of information on the market such as statistics and facts on geographical areas or a specific demographic – useful for helping create your business plan and forecasting demand and market trends.
Find out more about market research techniques.
Marketing tools and software
There’s lots of information available from marketing companies offering insight into consumers.
- Keyword (KW) research tools allow you to see how many people are searching for a particular topic online. You can then break this data down and look at specific regions and date ranges. You can also compare historically to see whether interest is growing over time.
- Social media and email marketing platforms offer regular whitepapers and reports into their users, which can provide helpful topline figures.
- Surveys from companies like SurveyMonkey and Hotjar allow you to talk directly to customers online and collect their feedback. Once they’re set up, they look after themselves, allowing you to dip in and out of the results as and when you want.
Discover more examples of market research with our guide.
Focus groups
Focus groups are a brilliant way to get feedback but can be difficult to organise and get right.
Picking the right people
Your focus group needs to mirror your customers or potential customers, otherwise their feedback is irrelevant.
Lots of big companies use focus group companies to recruit relevant users.
Running a session
Sessions typically last from one hour to three hours and involve around ten users who are usually paid.
Focus groups are shaped by what you want to get out of them and that should influence the questions and tasks you get participants to complete.
For example, if you want to know whether your website is easy to use, get participants to use the website and go through journeys you want your customers to complete.
Online focus groups
Focus groups can be conducted online.
Some market research providers use software that enables you to watch users interacting with your website.
What happens after a focus group session?
After a session, you should look for consistencies and common issues among the participants.
This should then inform your business strategy.
Get attendees to sign a non-disclosure agreement if showing them a new product or service and be sure to record feedback and take notes during the session.
Your previously read articles
Chapter three: Create your brand
Learn how to create an identity for your business that your customers will recognise and trust.
Next chapterReference to any organisation, business and event on this page does not constitute an endorsement or recommendation from the British Business Bank or the UK Government. Whilst we make reasonable efforts to keep the information on this page up to date, we do not guarantee or warrant (implied or otherwise) that it is current, accurate or complete. The information is intended for general information purposes only and does not take into account your personal situation, nor does it constitute legal, financial, tax or other professional advice. You should always consider whether the information is applicable to your particular circumstances and, where appropriate, seek professional or specialist advice or support.
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