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Focus Group

Definition: A controlled group interview of a target audience demographic, often led by a facilitator. A set series of questions or topics are covered, and the results are used to guide marketing efforts. A focus group generally consists of five to 12 potential customers who are asked their opinions in a group interview. Participants should fit your target market--for example, single men ages 18 to 25, or working mothers. To find participants, just go to your local mall or college campus and ask people fitting your customer profile if they would answer a few questions. Typically, companies pay participants $30 or more.

Although focus group interviews are informal, you should have a list of questions to help you direct the discussion. Start by asking whether your product or service is one the participants would buy. If so, what is the highest price they would pay? Where would they shop for such a product? Do they like or dislike the product's packaging? Your questions should center on predetermined objectives, such as determining how high you can price your product or service or what to name your business.

If you're going the do-it-yourself route, you will probably act as the focus group moderator. Encourage an open-ended flow of conversation; be sure to solicit comments from quieter members, or you may end up getting all your information from only the talkative participants.