Market Research: Small business strategy for market research check and business strategy

Many businesses fail not just because they lack funds or have cash flow problems but due to lack of appropriate market research. The two main areas that businesses need to research are the target market and competitors.

Quality time needs to be spent on the kind of target or audience market the business wants to target , check/find out whether its product(s) or service(s) is appropriate for the market, check if the market is big enough to accommodate the projected profits or too small, or if the market is too saturated with competitors and so on.

Businesses can use different questions to establish whether or not the market research is done properly.

1. Is it possible to identify potential customers?

2. Is there a market need for the product or service?

3. Is the product/service able to create a new market?

4. How viable is the product? and for how long is product lifecycle?

5. Does the product or service have a unique selling point when compared to what the competitors have to offer?

6. Is the product/service safe?

7. Are the legislation and relevant regulations being adhered to?

8. Are the product(s)/service(s) viable? i.e. will the product/service sell well at a good price to make enough profit ?

There are various ways of carrying out the research. The cost of carrying out the research will depend on how extensive the research is. There are two main classes of research namely the primary research and secondary research.

Primary research information can be more expensive to get because the research is usually done from scratch, new information is acquired and it is more up-to-date. Examples of primary research method can be in form of informal discussion with friends, family, acquaintances, and colleagues etc to ask what they think of the product or service. Surveys can also be conducted with the public to find out if they would use your product or service. Questions can range from what they think about the your competitors price, brand image, perception, product quality, loyalty etc. Some businesses also use focus groups to test products

On the other hand, secondary research information can be cheaper to get hold of and does not have to be done from scratch but it can be out-of-date easily. Examples include the use of existing industry statistical figures from national statistics figures, information on the product /service performance of the competitor, use of existing demographic data and much more.