To be successful, start-ups need to know the ins and outs of the market they're operating in. Market research is a vital tool to help you launch and grow your business; it gives you valuable market intelligence that you can use to plan and develop your strategy.
By conducting market research you get insights into how your target audience thinks and acts - including their buying patterns. It can also provide information on current market trends as well as shifts in the economy and changes in your demographics.
Market research allows you to identify new business opportunities. The information you obtain by carrying out market research will help you to build engaging marketing campaigns that reach your niche audience. This is because you can target the specific interests of your current and potential clientele - the information you gather from research will help you better decide who to target and when. It will also provide you with more lucrative opportunities to help you expand your business.
Market research is not just a great tool to get to know your audience; it can also give you a useful insight into your competitors' strategies. You can compare your business with others, enabling you to track your own progress and growth as well as theirs. Keeping ahead of competitors can be challenging at times, so through understanding the market you can create more concise and focused business strategies.
When you know your market, your audience, your competitors and your products, you can make decisions with a greater degree of confidence and precision. This allows you to minimise the risk of failure. Market research should always be part of your growth plan, since it can help optimise your brand strategy and, by focusing your efforts where they matter, you will maximise your return on investment.
By researching your market you can create a powerful brand personality, enabling you to generate promotions and messages that resonate best with your target audience. You want your words to ring true to them, whether that's through your website, social media, advertising or promotions.
With market research you can also test ideas and messages, streamlining your marketing by selecting those that best address the needs, attitudes and aspirations of your customer base.
Every entrepreneur wants their start-up to be successful; the safest way to achieve this is through knowing your market.
Copyright © 2016 Graeme Donnelly of Quality Formations, part of the Rapid Formations Group, offering a specialist company formation service for a diverse range of company structures.
Every day, thousands of people set up their own businesses. Many will agree that starting your own business is a great, but challenging experience. You need to understand the ‘start-up’ process, because this makes a big difference to the success of your new business. Here are the necessary steps to consider when starting up your new business.
Coming up with a viable business idea can be challenging and initial brainstorming can help you to arrive at one. Think about issues that people are faced with every day and write them down. Helping to solve such problems could enable you to come up with some excellent ideas. You could even brainstorm ideas that improve existing products and services.
Tip: Think of products and services that will add value to people’s lives.
This is where you will validate your ideas. You need to determine and test whether your product or service is viable by researching your potential market.
Ask yourself, “Is my product or service niche? Is there space for it or is the market saturated?” Are you likely to make enough sales given the size and nature of your target market?
There are many ways in which you can conduct basic market research, including seeking the opinions of family and friends. Also be sure to speak to people you don’t know.
Tip: Don’t just rely on secondary research, web resources or surveying only the people you know. Poor research can steer your business in the wrong direction.
This seems like a very obvious step, because you would need a business plan to secure a business loan. However, this step involves strategic planning and requires your full involvement. It will involve identifying your funding, business risks, as well as your aims and objectives. Here you will also evaluate your competition and understand your business’s cashflow.
Tip: Focus on the vision and viability of your business, potential for profits and the resources required, as well as a strategy for your success.
The assitance of a reputable accountant can prove invaluable when starting your own business. They will be able to provide you with assistance, objectivity and expertise. Your accountant will also be able to help determine the best legal structure for your business and help you establish bookkeeping and other forms of record-keeping procedures. This will ensure you stay on track and up-to-date on all your paper work.
Naming a business is a key decision. The name of your business is the first thing that potential customers will notice, so think of it as the entry point for your business.
Think about your target market, product/service and image that you want to project to your market. Your name should work well wherever it is used, whether over the phone, on stationery, website, logo, etc.
Also, it’s important to check whether the name you want to use is available. You can do this by searching the National Business Register.
Remember: Whatever name you choose, it should make you stand out from your competitors.
No matter what structure you choose, you are likely to work with a number of different people to develop your business, such as suppliers, possibly distributors and maybe partners.
You may want to find a co-founder with the necessary skills and knowledge in order to assist where necessary. Whether you need materials to make your product or equipment to run your service, it’s possible that you will work very closely with your suppliers.
A good way to search for reputable suppliers is by asking other businesses in your field or by searching online. Make a list of those that you thought were good and arrange a meeting in order to talk about their prices, to develop a relationship and to get an idea of which suppliers are reliable and trustworthy.
Before you register and begin trading, you must choose which legal structure is suitable for your business. When deciding, it’s wise to understand what each structure involves. Most businesses in the UK are sole traders, limited companies or business partnerships. You also need to find a way to fund launching your new business. There are many other steps you have to consider when wanting to start your own business, but by following the above steps, you will be ahead of the game.
This blog was provided by 1st Contact Accounting.
Market research and competitor analysis can be a start-up’s Achilles’ heel. Incorrect conclusions pulled from incomplete or inaccurate research often lead to dire consequences for start-ups that pursue a market segment that was inappropriately analysed.
So why do so many start-ups continue to get caught in this trap? Well, the answer is actually pretty obvious.
Thorough market research drains the two resources that are most precious to start-ups – time and money. Therefore, if you aren’t a research guru but still need thorough research, you can choose either to spend substantial cash on expensive services and tools to perform the research or to spend hours using conventional methods if you are trying to bootstrap.
So how do you produce compelling market research, but preserve your precious time and money? Well, the answer is pretty simple, just maybe not as obvious.
Primary research can be accomplished by using a variety of free online surveys such as SurveyMonkey. Another great option is to embed user polls directly onto your website. Fair warning, though, the majority of people who participate in these polls are usually the ones who are most dissatisfied.
For secondary research, you can use tools such as FindTheCompany. The database recently became available to the public for free and provides information on more than 30 million private and public companies.
For industry research, a great (and often overlooked) resource is public companies’ annual reports, which are often filled with hidden gems. They provide insight on an industry’s size and growth rate, as well as predictions on where the industry is heading in the near future. Public companies pay expert consultants lots of money to research and develop these reports. Essentially, they are paying for the data you need. And the best part – you don’t even need to be an investor to get these reports.
Finally, be a customer of your competitors. Look at their advertisements. From this, you can infer who their target market is, and which demographics they are trying to expand into. If your competition has stores in your area, pay them a visit. This sounds obvious, but many people don’t realize how much information they can gather simply by getting in their car and driving around town. This doesn’t mean you need to be deceptive, just be inquisitive.
Nowadays, start-ups cannot perform efficient and effective market research by sticking to outdated methods. They must innovate and make use of the new methods and free tools that emerge every day. Be smart about your research, it might save you more than just time and money – it might save your start-up.
Blog by David Schmidt, head of audience development at FindTheCompany.com
This is a question that would-be entrepreneurs need to ask themselves. It is not enough to have a good idea – or even a great idea – for a product or service. What you need to find out is whether you can provide that service or product to enough people who will pay enough so that you make enough profit.
So where do you start? The first thing is to research is what is out there already. If the market is saturated with competitors providing the same goods or services as you, then your business must have a pretty compelling USP (unique selling proposition) to make it stand out.
Check out the competition
How are your competitors doing? Companies must file their accounts at Companies House, and companies listed on the London Stock Exchange will have to provide detailed financial information to the public, which means that you can find out quite a lot about them after a few clicks on the internet.
The next thing to do is firm up the scale of your potential customer base and how much they would be prepared to pay. The best people to tell you about this are strangers (friends and family might fib to protect your feelings). If you need the results of the research for attracting funding, it can be worth paying professional market researchers who will present impartial findings in a clear way. If you end up doing the research yourself, strive for professional looking results. Common research methods include questionnaire and interviews with interested parties.
Conduct a realistic appraisal of costs
Think through every penny you need to spend to sell your goods or services, and make a note of them. Have you counted business premises, transport costs and tax implications? If you are making a product it is easy to focus on components and blank out these other issues which still have a bearing on whether your business can be profitable.
Think about business models
Finally, think about the structure of your business and whom you will be working with. If you lack certain skills, should you consider going into a partnership with someone who can make up that deficit? Or should you be considering setting up a limited company? Setting up a company can only take a couple of hours with a formation agent, and mitigates the risk in case your business turns out not to be viable.
Dear aspiring mumpreneur,
I'm writing this open letter to you to outline some crucial points that I wish someone had laid out for me. I'll keep it as short as possible because I know your time is precious but I'm sure that if you read this through, you'll save a ton of time in the long run.
If you are truly serious about becoming a part of the wonderful world of mumpreneurialism, read carefully what I have written below, you'll gain the information you need to act now and get in the right mindset.
Here are, not necessarily in the best order, my top tips to set you on your way:
So there you have it, the open advice that I wish I could have received when I first started out. I hope that it serves you well and that you go on to be truly successful and accomplish all that you set out to achieve. Maybe you could look me up in the Mumpreneur community and let me know how you're getting on sometime ― I'd love to hear all about it.
So, from one Mumpreneur to another - good luck, stay focused and live each day to the max!
Nikki Backshall, WebMums.com
Research suggests that as many as one in ten mums would like to run their own business. It can be the best way to get control over your working hours and spend more time with children, while still being able to contribute to household income. If you are a mum and want to run your own business, here are my tips.
1 List your priorities. What is important to you and what do you expect in return for running a business? Do you seek to make loads of money or are you simply trying to find a way to spend more time at home with your children?
2 Think about time. How many hours you can devote to a business. Be realistic if you plan to work around your kids. Remember – young children are especially unlikely to understand “mummy’s working”. Write down your which hours are possible, whether that’s 12-2 each day during nap time; 9.30-11.30 to fit in with nursery; 7-9 in the evenings or a combination of these on different days.
3 Research your market. All new business owners must do this by finding the answers to key questions. Will enough people buy your product or service at the price you plan to charge? Is your product or service unique enough to appeal? What competition will you face and how can you be different or better?
4 Write a business plan. Set out your aims and objectives – and the steps you need to take to achieve them. Pop into a local Enterprise Agency or Business Link for advice. See if they offer a free start-up course, which could be a great source of information and advice.
5 Decide your marketing and promotional tactics. Have a promotion planning session, during which you seriously consider advertising, marketing, PR and events. What method(s) are likely to be most effective for your business? Note on a wall calendar promotional activities you will do each month, but spend enough time each day marketing your business – it’s critical to success.
6 Promote your business online. Get a good website designed. Start a Twitter account in your business name. Create your own blog and blog on other sites. Start a Facebook fan page for your business. To make things easier, use Twitterfeed or Friendfeed to link your different networking sites.
7 Get registered. You have three months to let HMRC know you have set up as a sole trader (ie become self-employed), otherwise you could be fined £100. Alternatively, you might decide to form a company by filing the necessary forms with Companies House.
8 Keep good financial records. It’s easier to note down every item of expenditure from the start than to have to deal with an unruly pile of receipts when you have to complete you tax return. Many expenses are tax deductible, while you can also benefit from a series of allowances, too. Visit the HMRC website for more information – or seek advice from a good accountant.
9 Make the most of every customer. It is much easier and as much as eight times cheaper to sell to existing customers rather than having to attract and convince new ones to buy from you, so you must aim to delight your customers if you want them to keep coming back for more. As well as products, this must apply to your services, too. Whichever means is most effective, always maintain good communication with your customers. Keep them well informed and updated. Sort out any customer complaints quickly and satisfactorily.
10 Get help. Before starting up, assess your skills list and identify any that are lacking. You might need to find someone to help with your bookkeeping, PR, online marketing, sales, deliveries – whatever. You might not have the knowledge, time or will to do everything yourself. Providing your business can afford it, buying in help can free you up so your time can be better spent on something else. Explore all free sources of information and advice – including the Start Up Donut, of course.
After you start your business, you need to remain focused on your ideal work-life. If you’re not careful, running a business can easily and quickly take over everything, which means your home life suffers and this can affect how you feel. Have a finish time each day; put your work away when it comes; spend quality time with your family and make sure you set aside time to relax by and do things you enjoy.
Antonia Chitty, Family Friendly Working
Market research is an essential part of any business plan, whether a fledgling business or a multinational organisation. Knowing that there is a sustainable market for your product and understanding what your audience expects from you is vital to a successful business launch. Market research can generally be split into two categories; primary and secondary, and during this article I will explain both and discuss their respective merits and appropriate uses.
Secondary research makes use of existing data from whatever sources are available. There are government censuses, Mintel surveys, and many private market research agencies that allow access to their data; some of it for free. It can be hugely advantageous, especially as a place to begin. Secondary research more often than not, proves to be a solid base on which to develop your own primary research. It plays the same role as research in general does to your product launch, and should be seen as just as vital. Also, this is of course far cheaper and generally quicker than creating your own research from scratch.
The other side of that coin is that you have neither picked the panel to suit your exact needs, nor the questions. It is feasible that you can find some research somewhere that corresponds to what you are trying to achieve but it will almost certainly require some tweaking, and will not necessarily be the people you wish to interrogate; the use of qualitative research designed by someone else will almost certainly make the target specialised away from your goals. Another main issue with secondary research is that by the time it reaches you it’s often outdated; markets change so quickly in business that the only way to be truly current is through new research. This is not to rubbish the quality of secondary research.
Primary research is, essentially, the creation of your own research, whether a question that you ask to your friends and family or a survey put together alongside an agency and administered to a wide panel. Primary research will instantly let you feel more in control of your project; and that is the exact position you will find yourself in. You choose the questions and select your panel through qualitative research, allowing you detailed responses from individuals. You decide how, when and where your research is administered. You can ensure that your research is focussed: the number of participants and their backgrounds, the number and nature of the questions, the amount of time that your survey is available. This is the most accurate way to research a market sector that is specific to you and your product.
The down side
It is of course, more expensive, whether financially or on your time. If performing primary research alone it will take a lot of time, refining and will need some experience in producing quality questionnaires. It will also take time for your questionnaire to be completed if you don’t have direct access to a ready panel. Most of this can be avoided by using an agency, but at a cost higher than performing your research alone.
So what’s the best option?
Neither type of research will take you to your goal alone; however, a combination of the two will give you all the information you need. Using primary research alone, without first seeing what has or has not worked for other companies and possibly missing out on important data from research that you couldn’t afford to perform yourself, is likely to lead to irrelevant questions or missed opportunities. At the same time, relying solely on secondary research is likely to leave you with answers that are vague or inappropriate to your specific audience. The two compliment each other well, and when used in conjunction will give you a well rounded and accurate portrayal of the needs and opinions of your market sector.
You're probably reading this blog because you are in the process of starting up a new business or you've got a great business idea that you want to develop and launch.
First of all, congratulations! It's a great feeling when you make that decision to start a new business. And if you’ve never done this before, you're at the beginning of a very exciting journey.
Now for the bad news. If you've just come up with a great idea and are now rushing to get it to market, you've probably got a really serious problem. And that problem is that your idea is quite likely to be fundamentally flawed. Or to put it another way, it's likely to go really badly wrong and it's probably not going to work.
I know that doesn't sound very encouraging, but before you rush off into the distance and start investing a lot of time and money into implementing your idea, you need to do something very important indeed...
You need to challenge it.
You need to look at your idea from different perspectives. You need to put yourself in the shoes of potential customers. You need to put on Edward DeBono’s black hat and challenge your idea seriously. While all of this may sound terribly negative and destructive, it's really important that you take this advice on board. So many businesses are launched with insufficient planning, insufficient testing, not enough feedback from people and poor advice.
If you actively approach your idea from a balanced and objective point of view, where you've considered the huge upsides as well as any potential downside which exists, then you'll be in a much better position to get it right.
Like with anything, starting up a business takes patience and a whole lot of learning. Market conditions change so quickly that you need to always approach you business holistically, and be willing to take advice on board. With those things in mind, it seems like you’re half way there having found this Donut!