1. Overview
It’s easy to believe you have an excellent idea for a business, however, if your business is to be a success, you need to confirm and verify that belief. Market research is a cost-effective way to do just that. This section takes you through the market research process to help you make better decisions.
2. What is Market Research?
Market research is the process of collecting and analysing information about your market, competitors and customers. It enables you to find out what your customers want and to match your products and services to that demand. It also helps you keep up-to-date with what your competitors are doing and what is happening in the market.
This guide helps you identify the questions you need answers to, explains where to get information and which techniques to use and shows you how to use your findings to make better decisions and improve your competitiveness.
3. What do you need to know?
When you are starting a business, market research can help you check the feasibility of your business idea and shape it so that you have the greatest chance of success. The 3 areas you need information on are:
- the market
- competitors
- customers
The market
When looking at the market, you’ll want to consider things like:
- how large is the market?
- how many businesses are there (in the same sector as me)?
- how many started up in this sector last year, and the year before?
- is it a growing market, or declining?
- what are the key factors that influence this market?
- is there room for my business idea?
Learn more about Market research with this BOSS course.
(BOSS Digital courses created by Business Wales to support starting and running a business. Sign in/Registration is required).
Competitors
The questions you’ll have about the competition are likely to include:
- which companies are offering something similar to me?
- how successful are they?
- what products and services are they offering?
- what price are their products and services?
- what marketing strategies do they use?
Customers
One of the key areas you’ll need to look at is your customers and the things that influence their buying decisions. Your market research will help you answer questions such as:
- what sort of people will want to buy my products or services?
- do they fall into different categories?
- where do they currently buy this sort of product or services?
- what price range are they willing to pay?
- how many and how often do they buy products or services like these?
Test your knowledge on identifying your customers with this BOSS course.
(BOSS Digital courses created by Business Wales to support starting and running a business. Sign in/Registration is required).
Steer your business in the right direction
To get the most out of your research, you need to identify the specific information you want from each of these areas. Some information will be easy to access, some more difficult.
There’s no secret formula as to how much market research you should do – it will vary depending on the nature of your business and how long it takes to get the information you need to inform your decisions.
It is unlikely that you will ever have all the information you want. The key is to have enough information so that you are equipped to assess the risks adequately and make decisions that will steer your business in the right direction.