Inexpensive Market Research Methods

Step 3: Get to Know Your Marketing

Once you decide you have a viable market, it's time to find out more about it.

Secondary research helps you refine your customer profile and gives you broad guidelines for your marketing efforts. But because it's all derived from information that focused on others, it's only so much sophisticated guesswork that applies to everybody in your position. Market research that's done specifically for your business, or "primary research," is where you'll get intimate with your own unique market.

Keep your mind open to any information, but also keep a list of primary research questions handy, such as:

  • Who influences your customers and how? Spouses, neighbors, peer groups, professional colleagues, children and the media can all affect buying decisions. Look for hints that one or more of these are a factor for you.
  • Why do they buy? Distinguish between the features and the benefits your product or service offers. Features describe what it is; benefits are what your customers get out of it. The latter is why your customers pay you. Are they looking for a status symbol, a savings in time or energy, a personal treat or something else?
  • Why should customers choose you and not your competition? What can you offer that the competition doesn't?
  • How do your customers prefer to buy? Many businesses benefit from the broader market provided by the Internet and mail order, while others do better with a physical presence. Don't assume you fall into one category or the other; customers may surprise you.

Keep those questions in mind as you take the following research steps:

1. Read, read, read. Articles, interviews and survey results published in trade periodicals reflect specialist knowledge of your market. Publications that focus on your business type are invaluable for forecasting upcoming trends and identifying customers' needs. But ads, letters to the editor, and other "extras" can be even more revealing. Study the ads (full- and half-page ones as well as the classifieds) of businesses similar to yours; watch for features your competitors most want to emphasize or de-emphasize. To get an overview of recent changes, order back issues, or find them in the library. Are there more or fewer ads now than last year or three years ago? Do those that have lasted have anything in common?

Readers' letters often contain information on what your customers like or dislike about certain products or companies. Editorial pieces frequently highlight hot trends, which should have a bearing on your marketing plan. Say you're starting a creative sewing pattern company. If three sewing magazine editors in as many months mention the plus-size market, and you see half a dozen letters complaining about the lack of choices in larger sizes, you've just received a hint in neon.

2. Tap the Internet. Newsgroups and discussion lists on the Internet debate every imaginable topic. Chances are, some of them partially match your customer profile. They may be talking about the type of product or service you offer-or can be encouraged to do so. Best of all, everything they've ever said has been archived. It's like having a ready-made, if somewhat chaotic, focus-group transcript at your disposal.

You can glean information just by finding archived threads relevant to your business and paying attention to comments made by those who fall into your target demographic. As a shortcut, type the names of your competitors (you found these during your secondary research) in the search boxes.

You can also take it one step further and start your own thread to initiate a more tightly focused discussion. A caveat: Some lists and groups don't welcome commercial postings. Always observe their rules, and phrase your questions discreetly. You can ask any number of questions that don't violate their posting etiquette and still supply you with a wealth of feedback ("What should I look for in a good pet-sitter?" "What's everybody's favorite brand of low-carb chocolate?" "How much is too much for a handmade harp?" "Where's the best place to buy organic baby products?"). You can follow up the answers with further questions until you have the level of detail you want.

3. Check out the competition. You can learn about what to do and not to do by studying your competitors. Visit their Web sites, and look at their prices, guarantees, testimonials and special offers. If they offer newsletters, get on their mailing lists. You'll get free information on improvements, new product lines, trends and even customer responses.

Spend some time analyzing their advertising and sales literature. What do they emphasize most? What are they not mentioning? Do you see aspects you could improve?

Try calling or e-mailing them to ask about their rates and services. If they have stores, visit and browse them. Write down your impressions as soon as you've hung up or left the building. Keep a record of each one, and ask yourself what all or most of them have in common, why you think that is, and how you can set yourself apart.

4. Get students involved. Call or visit the Web sites of local business colleges as well as the faculty of business departments at universities and colleges in your area. Find out who teaches classes on marketing, preferably small-business marketing. Try to persuade them that your business would make a great real-life market research project.

They may agree, especially if you're willing to provide samples and demonstrations on request. You'll have a better chance at certain times of the year, so if you've caught them at the wrong time, ask when might be better and whether they can refer you to anyone who runs on a different schedule.

If it pans out, you'll have to work with the professor's teaching plan and timetable, but you'll end up with 100 percent relevant, thorough, customized research results put together by people who intend to make a career out of this.

is a marketing consultant specializing in startup business planning and copywriting.

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This article was originally published in the August 2004 print edition of Entrepreneur with the headline: On Target.

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