Before you start a business, it’s important to know your market.
At Nurture, we’ve seen a lot of small businesses come through our doors. Many of which have succeeded, while others have had to learn the value of failure. Along the way, we’ve learned a thing or two about what it takes to succeed.
In a nutshell? Research. A great idea will fall flat without it.
Why is it important? If you don’t understand your customer, you can’t service them. As a small business owner, the most important relationship you have is with your customers. Once you know them, you can tailor your marketing material and brand personality to connect with them. Conducting market research helps you improve your products and services, and understand what drives your customers to purchase your product, or not!
Here’s how to conduct market research
1. Build a customer profile
List the demographics of the customer that will buy from you. How old are they? What gender are they? What are their interests, and where do they live? Looking at your competitors is a great place to start.
2. Use the internet
There’s so much information readily available online. Search for market research on the customer group you’ve just described. Chances are, you’ll be able to learn even more about their buying behaviour.
3. Use your networks
Real-life research is extremely valuable too. Use your social and business networks to connect with people who fit the demographic. Ask them questions to learn more about what drives and interests them. For example: ‘Which brands get your attention? Why do you buy this product, and not their competitor? How much are you willing to pay for this product?’
If you’re wanting to formalise your research or try other methods, you can host workshops or focus groups, run surveys or even start a community via Facebook or another platform.
“There’s so much information readily available online. Search for market research on your customer group.”
Don’t forget the competitor analysis
This is an important but often forgotten step in the research process. Once you understand who you’re up against, you can learn from them and decide how you want to differentiate.
Here’s how to conduct a competitor analysis
1. Identify who your competitors are
Some of them might be obvious and known to you already, but it’s also worth asking your customers who they purchase from. Desktop research is a great tool for this as well.
2. Compare your competitors
Understanding what makes your competitors different will help you identify your own point of difference. Look at things like pricing, brand tone of voice, colours and marketing channels. Do they appear to be targeting an older demographic, or a younger one?
3. Find your place
Where do you want to position your brand, in comparison to your competitors? Look at your strengths and weaknesses and identify the strongest opportunity for your small business.
“Understanding what makes your competitors different will help you identify your own point of difference.”
Having a deep understanding of your market is integral to the success of your business. Well-executed research is the best way to get there. Good luck!
If you’re looking for more business advice, or simply curious about how we can help your small business grow, please drop us a line. We’d love to take this journey with you!
Still have questions?
Perhaps you’d like to know more about this blog’s topic? Or perhaps we impressed you so much with our know-how on this topic, that you’d like to ask us about another accounting related topic?
Either way, feel free to drop us a line – we really are as friendly as we seem to be.