Market research is done with the purpose of finding out more about the prospects of your business idea succeeding when you launch it. So think of the uncertainties in your mind or even if you are absolutely sure that you product/ business will succeed when you start it, think of the things that could go wrong such as not finding enough customers, cost being too high etc.
Questions to ask when you’re doing market research.
Whether you hire a professional research firm or take on the duty yourself to do market research, your research should clearly answer the following questions.
The intent of the market research should be to discover as much as you can about the unknown factors controlling the success of your business. In this manner, a market research should typically provide you with the answers to the following questions.
- Who will buy the product – Most important aspect to think about. You have a great idea for a business. But is there anyone to buy your services or product? The demand of a business can depend on a lot of factors like income levels, demographics etc. So make sure you find out if the target customers are present where you want to start your business.
- Why will they buy it – Why will a person feel the need to buy a product? Does it cater to some requirement that is unmet by current business? Is it a product that is better than the competition? Are you creating a new need by your innovative product?
- Where will you sell it – Equably important. Not all kinds of consumers go to all locations. Where will your product or service me able to target your customers the best.
- How much will you price it – Pricing is important. Ask for too much and no one will be willing to pay for your business. Price it too less and you will not make as much as you could or would like to even though you have many customers.
- How much profit will you make – Deciding a profit margin depends on a lot of things like the demand and supply. If your business is sought after, it could be up to you to decide your profit margin. You could go with less profit with volume sales or high profit with selective sales.
- How much of a market can you expect to create – Are you going to create a new market and consumer need with your product?
- How much demand and redistribution – How much current market are you simply going to redistribute?
- How much competition do you face – How much competition do you face?
- Do you have an edge over the competition – How are you going to set yourself apart from the competition?
- Do you have a niche – Have you created a niche for your business that puts you in a specialized field?
- What are the laws and government regulations affecting your product and do any future changes in these policies affect the way you run your business?
Ineffective or lack of market research can be death for a business.