LLTT (Looking for London and Turning to Tokyo) is an often used phrase for people running directionless. Similarly, an extensive market research before starting a business enhances the possibilities of attaining profit rather than rambling towards loss. The most fundamental question before starting any business should be- ‘Why’ do a ‘particular’ business. The answer lies in the findings of market research.
If for instance, a company starts functioning without conducting a proper market research, and in the first month it gets an order from an overseas company. Enthused with the order, the shipments are executed. What if later the company realizes that there is no such importer. There is no one to claim the shipments and the export cost is bound to be borne by the exporter/company. In such cases, market research acts as a road-map, assuring the company of the best possible use of its funds.
The success or failure of any business largely depends on its market research. You invite trouble if you launch a business without doing a thorough market research on your consumers, price and your competitors.
Moreover, a profound market research offers a great level of comfort in exploring the means to overcome hurdles for market entry. Through a thorough market research, the company comes to understand consumers’ needs, new trends and fair market prices.
Market research- the mother of 4Ps of Marketing
Manufacturing a product is not a proof of the battle won. The finished product needs to be marketed and sold. The market research plays a key role in developing the marketing strategy which incorporates Product, Price, Place and Promotion. Only the market research tells you how good your product is as compared to the other competitors. Again, it is only the market research that plays a pivotal role in determining the price of the product. Market research also helps in deciding the geographical spots where the product is most likely to sell. Lastly, the promotion of your products is heavily based on a proper market research.
Customers – They are the ultimate target audience for your products. Any business is aimed at catering customers’ needs and interest. Through face to face interviews, telephonic conversation, focus groups, and posts. Try to get to know their requirements and expectations from your product. Without knowing the customer’s interest, it would be difficult to pursue them to buy it.
Price – Startups can only stand in the market if their prices are pocket-friendly for the customers. The company needs to commit to an aggressive research on competitor’s product prices and should accordingly determine their product prices. Buying samples of competitors’ products, online price parity portals etc. are some of the key places where prices of competitors can be brought to light. Try to maintain the price keeping in mind the bulk purchase of products by some potential customers.
Competitors – You need to make sure that there is big enough slice of market for your business to prosper. A proper SWOT (Strength, Weakness, Oppression and Threat) analysis of competitors enables the startups to determine their strategies. A cost effective method to check competitor’s product details can be by paying a visit to the store, or checking the competitor’s website or checking business directories online.
Embarking on a journey with a smart idea and research would surely lead you towards success and the right kind of market research would give you more clarity in every aspect of your business. So, eliminate those myths which says that market research is time consuming, unnecessary and too expensive. Rather follow some proven guidelines to become a successful entrepreneur.