Market Research
You know that moment when a flash of brilliance bursts into your awareness. It’s incredible!
But you can’t depend on flashes. Although they happen, you might end up waiting a long time.
Another way to find these revolutionary ideas is to look at the world as it is, and deliberately invent a new way for it to be.
Now you have a new idea. But you will want to validate it. Is this a good idea? Can you build a business on this idea?
Market research lets you answer these and other questions. Market research will help you better understand the value of your new idea and how to improve on it.
The thought of market research scares people. It conjures images of expensive marketing consultants going door to door, or a bank of telemarketers calling people at dinner time.
Well, the scale may be different, but the concept is the same. Much of market research is talking to people. Call people you know, ask them whether your idea would be of any use to them. If you don’t know any one who would use your product or service, ask people who they know.
Network. Talk to individuals representing at least ten organizations. That’s a minimum but not totally reliable. Thirty organizations will give you a strong foundation. Ask those people if they’d buy your “thing,” and at what price they’d buy it. Ask them what features it should have other than the ones you’ve already mentioned.
Next you have to determine how many potential customers exist for your product. Describe the type of person or organization who would consume your product.
Can you describe them demographically? By age, sex, job description, geography, income bracket, industry type, etc.? If not, who are they most similar to? What similar thing do they already buy which is measured? What publications do they all read? You have to find something you can count.
Now you know the size of your potential market.
After you count them, you need to make another guess: what percentage will buy? That is the potential for your product.
If you want to go the next step, make a test offer. Write a letter – create a promotion and test mail it to a segment of the population you’ve identified. Or call them on the phone, if the number is small enough. Invite them to use your product.
Keep refining the details of your offer until a large enough number say yes.
Congratulations. You’ve just done market research, the fast way. Now you can rush full speed ahead into product development knowing there is a market for your ideas.
And the only consultants you needed were your customers. It’s that simple.
Market research is extremely important to the introduction stage of the product life cycle. With your market research you can learn who your target market will be, what they are willing to buy and at what price. This data is priceless and you cannot live without it.
So, how will you obtain your market research?
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